In this article, we will go through the dimensions (or degrees of freedom) for strategic choices and strategic decisions that companies’ shareholders and CEOs usually make in the market of oil and gas heavy machinery and equipment.
For those who are not acquainted with the idea of strategic choices and dimensions, there is a description of this approach available here. Nevertheless, it is worth mentioning that for any industry analyzed there are standard and non-standard dimensions. In this article standard dimensions will be mostly discussed with some non-traditional dimensions for the oil and gas machinery briefly touched.
Products and Services
The products for oil and gas equipment can be divided into two parts.
First, the standard oil and gas products, i.e. the actual machinery and equipment used. These can be divided into four basic groups:
- geological exploration;
- extraction;
- stockpiling and transporting;
- oil and gas processing.
Second, the standard services provided by the companies in this industry:
- services connected to actual drilling with the use of the equipment;
- geophysical research;
- intensification of extractions returns;
- leasing the equipment;
- repairs and servicing the equipment.
Technology – IT and Digital Solutions
In terms of the technologies it is usual to look from the IT and digitalization point of view. There have been quite a lot of ideas implemented recently:
- robotization and artificial intelligence;
- using the advantages of the Internet of Things;
- cloud technologies;
- 3D printing advantages implementation;
- other tech solutions.
Value Chain
Naturally, this is the dimension connected to the value chain in the oil and gas equipment production:
- research and development;
- acquisition of resources and raw materials used in production;
- actual production of serial equipment;
- producing some particular single-piece equipment (for oil and gas equipment this is quite a significant part of the industry);
- logistics and distribution;
- leasing equipment;
- servicing, repairing and all other after-sale services.
Geography
It is needless to go through the geography standard dimension as this is quite straightforward. The only thing here to keep in mind is the use vs. production sites separation:
- geography of sales;
- geography of production of this equipment.
Non-Traditional Products
Finally, just to provide an example of some specific dimension for the oil and gas machinery industry we can look at the specific technologies variety:
- traditional production tech;
- directional or slant drilling (including horizontal drilling);
- liquid natural gas;
- development of ocean and sea resource sites;
- piped natural gas (PNG) and oil;
- deep oil and gas processing.