Jul. 30, 2018
Oil Country Tubular Goods (OCTG) Supply Chain Management Agreement Signed with Oil Major BP in Oman
Sumitomo Corporation (Head Office: Chuo-ku, Tokyo; Representative Director, President and Chief Executive Officer: Masayuki Hyodo), via its subsidiary SC Tubular Solutions Oman LLC (Head Office: Muscat, Oman) (hereinafter, the two companies will be collectively termed “the Sumitomo Corporation Group”), has concluded a long-term (four-year) agreement on oil country tubular goods (OCTG) supply chain management services (hereinafter, the "Agreement") with BP Exploration Epsilon Limited (Head Office: Muscat, Oman; hereinafter, “BP Oman”), affiliated with the UK oil major BP p.l.c. (Head Office: London, United Kingdom) (hereinafter, these two companies will be collectively termed “the BP Group”). A signing ceremony was held in Muscat, Oman.
The Sumitomo Corporation Group has worked with Nippon Steel & Sumitomo Metal Corporation to supply to BP Oman’s inventory hub the OCTG used by BP Oman since it began developing the Khazzan tight gas field (*1). In accordance with the Agreement, the Sumitomo Corporation Group will be delivering OCTG to Duqm Port (*2) in southeastern Oman, which offers excellent access to key locations inside and outside the country, instead of the current destination, Sohar port in northeastern Oman. The Sumitomo Corporation Group will also be managing inventory in the free zone (Special Economic Zone Authority of Duqm (SEZAD)) newly constructed in Duqm Port. Managing both transport and inventory will allow the Sumitomo Corporation Group to achieve greater operational efficiency.
The Sumitomo Corporation Group and Nippon Steel & Sumitomo Metal Corporation have built and maintained good relations with the BP Group since starting OCTG supply to the BP Group in 1997. Utilizing its extensive global network, the Sumitomo Corporation Group will continue helping the BP Group make its operations more efficient by providing just-in-time OCTG supply, proper maintenance and inventory management.
(*1) Khazzan tight gas field: one of the BP Group’s more focal projects in which the BP Group has been responsible for drilling in a particular sector (Block 61) since 2013. Recent drilling has gone smoothly, doubling gas production from initial expectations, and the BP Group has thus decided to made additional investments to boost production volume still further.
(*2) Duqm Port: This port, which has excellent access not only to Oman’s major oil fields but other Middle Eastern countries, Africa and Asia as well, has been developed at the initiative of the Oman government since 2009. The Sumitomo Corporation Group is the only Japanese company with an inventory base in the port.
■ Map of Oman
■ Signing ceremony
From left: Mr. Morioki (General Manager, Head of Dubai office of Nippon Steel & Sumitomo Metal Corporation), Mr. Yousef Al Ojaili (President of BP Oman), Mr. Ozaki (President, Sumitomo Corporation Middle East FZE)
■ Sumitomo Corporation’ s Material Issues
The Sumitomo Corporation Group has positioned “Six Material Issues to Achieve Sustainable Growth with Society” as important factors in developing business strategies and in the decision-making processes for individual businesses. Going forward, we will pursue sustainable growth by resolving these issues through our business activities. This latest project will contribute especially to “Contributing to the Development of Local Communities and Industries” and “Providing Diverse ‘Accessibility’”.