Procurement in Oil and Gas Industry in Developing Countries Nigeria Agip

I certify that I have read the assigned material on academic integrity, and this paper is an original paper composed by me for this course. It has not been copied or closely paraphrased from any other source and has not been submitted as a whole, or in part, for credit in any other course at OU or any other educational institution. It has not been created or submitted for any other purpose such as a job assignment at my workplace or any other agency.

To correctly address the problems facing Universal, an examination of the current business culture within the company is necessary. Business culture refers to cultural differences, and expectations of the way companies conduct business according to the cultural values associated with a company. The problem facing Universal is a lack of a unified culture. With an overemphasis on collaboration, but lacking in directional leadership; previously, the company has relied on acquiring new businesses during times of expansion. A lack of a unified culture, however, has led to lengthy debates and discussion, which has currently placed Universal at a competitive disadvantage. Presumably, a lack of a unified culture and the overemphasis on collaboration has become a culture within itself for Universal. Culture should at least be implicitly defined within an organization because it provides a method for how to problem solve as well as prioritize goals (Dyer, 2015). For Universal, the lack of culture has created disagreements and delays, and both of these are intolerable in the current situation Universal faces.

The Chad Cameroon Petroleum Development and Pipeline Project is one of the largest investments in the private sector in Africa that costs approximately US$3.7 billion. The project is being funded by the World Bank and the International Financial Corporation. The involvement of these two major financial institutions is a demonstration of the rationale that the project will generate revenue that will enable the Chad and Cameroonian governments to invest more in programs that focus on reducing poverty like rural employment, education, and health. The involvement of the International Financial Corporation will be geared towards accomplishing three major roles. These are long-term financing, stabilizing role, and uplifting the quality and standard of mitigation plans and environmental assessments.

     Nigeria has been a country in political turmoil for a long time. The country was created in 1914 under British colonial rule and at that time it was considered a protectorate. It was not until 1960 that Nigeria received independence from the United Kingdom. One of Nigeria's problems politically is that it has over three hundred different ethnic groups. The three largest of these are the Hausa-Fulani, Igbo, and Yoruba. At the time of the independence of Nigeria it was split up into three states with each state being under the control of one of the major ethnic groups. The natural resources of the other 297 ethnic groups were exploited for the major three groups,

The author accurately stated throughout the article that the government is removing the subsidy as act of corruption. This was shown firstly, by moving the audience towards the direction that the promises deliberated during presidential campaign were not sincere. This therefore, allows the reader to understand that the Nigeria population was not adequately or not educated about this matter. Secondly, the authors provides figures of the refineries’ lack of capacity which showcases the years of mismanagement and corruption which has led to the incapacity to refine oil in the country. Thirdly, it emphasizes that the removal of such subsidy has taken place during the worst time ever given to all the instability in the North and moreover with the energy problems that Nigeria are currently facing. However, in my opinion despite all these facts stated by the author, I strongly believe this article has only one side of the story. In other articles which were investigated for the purpose of this analysis such as it talks about the massive problem they are with smuggling (Madukwe,2012), in addition, it explains how this massive amount of money which is being used to acquire

“Nigeria is currently the largest oil producer in Africa and was the world 's fourth-largest exporter of LNG in 2015. Nigeria 's oil production is hampered by instability and supply disruptions, while its natural gas sector is restricted by the lack of infrastructure to commercialize natural gas that is currently flared (burned off).” (British Petroleum, 2016) Nigeria is a member of OPEC. Although Nigeria is the largest oil producer in Africa, its production is affected by unplanned outages; some that have been estimated to have been up to 500,000 BPD. (U.S. Energy Information Administration, 2016) Nigeria’s petroleum industry is impacted by regulatory uncertainty, corruption, mismanagement of oil subsidies, oil theft, sabotage, environmental damages, and piracy in offshore West Africa.

BP is one of the biggest petroleum and energy companies in the world. It has a truly interesting history that stated very early in the 20th century in Persia, when an Australian/British magnate decided to explore the country’s soil in search of petroleum. After the success of such expedition (That at some point almost failed) the company developed a rich market and expanded all through Western Europe, as well as some parts of Asia and Oceania. They also played a crucial role during the wars, by providing the British with fuels for their army.

The Nigerian oil production has been an issue that has become a cruse to the people for so many years. According to reports, the oil production has lubricated to Nigeria’s failure because it has damaged the economy as well as the environment and democracy. Anyone would think that a country that has an enormous resource of petroleum would be economically stable but this is not the case in Nigeria. For many years Nigeria has suffered effects directly as well indirectly from the oil industry. For my research I am drawing from two sets of sources. I will be referring to the books that I have researched as my A-sources. The newspaper articles will be referred as my B-sources in this paper. Through out my paper, I will show you how and explain why the media today only reports one side of the story while the books on my geopolitical topic will tell the background to the events occurring.

Most children in the Niger delta have little or no education, due to lack of funds from their parents who have lost their lands and have no jobs because of limited opportunities. The Niger delta government and the oil companies have refused to look into the situation; instead they favor their close relations neglecting the masses. Corruption in the Niger delta has led some youths in taking drastic measure in order to put food on their table. For example, Ikechukwu Efe an indigene of the Niger delta said that some of his friends created their own “oil refinery”, which is made up of crude oil in metal barrels with controlled heat from fire woods. This is a dangerous process in refining crude oil but the degree of poverty in the state left his friends with no choice. If only the government of the Niger delta have created jobs with the wealth of the state Ikechukwu’s friend would not have to put their lives in danger. Until corruption is put to an abrupt the people of the Niger delta will continue to live in poverty.

We used two analyses methods to identify background and to evaluate information that we have.

Finally, we think that corruption in Nigeria is presented on a large scale because the government allows it, so this case involves a very important and outrageous government and its leaders. And the company in question, we think that this had to have chosen a better his legal representative in Nigeria for the construction of the plants (they were a part of the blame)

Therefore, its due to this gap & fact that the researcher had to carry on such kind of research through: investigating the current procurement process based on pre-procurement and post procurement so that the researcher can gain conclusion and recommendations for future proper usage of resource for the achievement of the authority 's goal and dependable procurement process.

Additional companies are managing spend categories that now cover the global economy. Procurement experts are hence taxed with having to cope with many spends projects within regions where reliable supplier choices are restricted. This can make problems logistically and needs the procurement personnel to be better skilled plus suppler.

As stated by Jones et al. (2006) “Reexamining the relationship between owners and suppliers, which involves rethinking the contractual framework and increasing the level of constructive cooperation so that both parties can jointly address current and future concerns.” Although, setbacks are sometimes inevitable it also good business to reevaluate suppliers if they can’t perform the task necessary oil and gas companies can either modify or terminate the contract to help avoid legal issues or any breach of contracts. It is also necessary to track any changes that have been implemented. Contract management can be challenging but it would high complex if contract were not met. Given the flux environment of oil and gas there are many variables that feed into the contract changes. Whether it be added supplier, added countries, changes in product production track and changes can help with risk management and help with any issues and solutions that are necessary with in the contract to help keep limited liabilities at all levels.

This is important especially if the customer does not have an already established relationship with suppliers. The search should be limited to the area of focus that is the area in which the customer needs product or services. This can be done through various way such as catalogues, advertisements (expression of interest), direct sourcing among others