Procurement and contracting for oil and gas operators, NOCs, IOCs and joint ventures - from category strategy and tendering to contract management, cost recovery and close-out. Built on live engagements, delivered as outputs against a service-level agreement.
Oil and gas procurement is the sourcing, tendering, contracting and management of the goods and services an oil and gas operator buys - drilling, wells, EPC packages, logistics, materials and operations support - across the life of an asset. It differs from general procurement because spend is concentrated in a few high-value, long-life contracts, is usually shared between joint-venture partners, and is often recovered from a host government under a production-sharing contract. That makes contract strategy, not rate negotiation, the main lever on cost.
Four features set it apart from procurement in most other industries.
Concentrated, long-life spend. A drilling campaign, an EPC package or a multi-year operations contract can commit more value in one award than a year of routine purchasing. A copied scope or a weak remuneration model is locked in for the life of the contract.
Shared money. In a joint venture, the operator spends on behalf of partners who see the result last. Joint operating agreements grant audit rights for exactly that reason.
Recovered money. Under a production-sharing contract (PSC) or production-sharing agreement (PSA), allowable opex and capex is reclaimed from the host government - but only what the file can defend.
Thin markets. Some categories have one or two credible suppliers, and supply shocks move prices faster than a tender timetable. When supply is single-source, a competitive tender cannot do the work alone.
Each feature moves the decisive work earlier - into category strategy, tender architecture and contract design - and later, into post-award control and the cost recovery file.
Seven stages, each a service you can buy on its own, with fixed scope, fixed fee and a fixed delivery date.
Group spend into categories and give each one its own sourcing, contracting and supplier strategy - built on spend analysis and current market reality, not last cycle's scope.
Category & contract strategy →Scope, remuneration model, evaluation model and prequalification. Should-cost analysis and total cost of ownership enter the evaluation before award, not after it.
Tendering & outsourcing →Contract management plans, contract performance management and KPIs that pull in one direction, so the intent of the contract survives signature.
Post-award contract management →One inventory baseline, linked to real demand, with an owner per category - so obsolete inventory is prevented instead of written off.
Materials management →Continuous, independent verification that contracts and joint-venture agreements are executed as designed - before an audit is needed.
Commercial assurance →An audit-defence file built as the work happens, with evidence for every commitment and a negotiation position ready before the audit letter arrives.
Cost recovery →Evaluate every contract against its original drivers and turn what it taught into the input for the next category strategy.
Close-out & evaluation →Outcome drivers, scope, remuneration model, evaluation model and price book - in three to six weeks, at a fixed fee.
Procurement architecture →Each figure comes from a published powerabode insight, which cites its source.
| Where | The number | Read more |
|---|---|---|
| Cost programmes built on rate cuts | Rates hold at most 20% of savings potential; efficiency holds about 40% and specification about 30% | Why rate cuts miss 70% |
| Tender quality | Roughly 22% of tenders reuse an unrevised scope of work from the previous cycle | Category management maturity |
| Procurement maturity | Nearly 80% of companies say their procurement capabilities are not mature enough for their own needs (Bain & Company) | Category management maturity |
| After award | Organisations lose an average of 9.2% of total contract value post-award (World Commerce & Contracting) | Contract governance in JVs |
| Cost recovery | Over $600 billion a year is subject to cost recovery; typical recovery lands at 85-95% of spend | Cost recovery leakage points |
| Supply risk | 42% of procurement leaders name supply disruption their top concern (Gartner, October 2024) | Procurement risk management |
| Drilling | A contract strategy built on total cost of ownership cut drilling cost by more than 60% and delivered wells 50% faster | Drilling cost reduction |
NOCs entering new basins or new contract models, building local content into tenders, and preparing cost recovery positions with their governments.
A first offshore entry →Operators who need savings that reach the P&L, tenders the board can award and auditors can defend, and contracts that hold their intent after signature.
The Program →Non-operators and governments who need independent assurance on how shared money is spent, and sovereign buyers designing government-to-government deals.
G2G deal design →Offices in The Hague and Dubai (Almas Tower, JLT). Engagements across the Middle East, Africa, Asia and Europe.
Short answers to what operators, NOCs and JV partners ask first.
It is the sourcing, tendering, contracting and management of the goods and services an operator buys across the life of an asset - from drilling and EPC packages to logistics, materials and operations support. Most of the value sits in a small number of large, long-life contracts.
Spend is concentrated in high-value contracts, usually shared between joint-venture partners and often recovered from a host government under a production-sharing contract. Contract strategy and the evidence file therefore matter more than the unit rate.
From efficiency and specification rather than rates. In live engagements, rates hold at most 20% of savings potential, while operational efficiency holds about 40% and technical specification about 30%.
At powerabode, a defined output against a service-level agreement - a category strategy, a tender package, a contract management plan, an assurance framework or a cost recovery file - with fixed scope, fixed fee and a fixed delivery date, rather than advisory hours.
Most services run three to six weeks at a fixed scope and fee. A tender architecture for a critical or first-of-a-kind tender has been delivered in three weeks.
Negotiate from an independent cost estimate, not from the supplier's quote - most useful in drilling and EPC.
Read the insight →How operators turn scattered JV and category spend into visibility and savings.
Read the insight →Why TCO belongs in tender evaluation before award, in capital-intensive energy contracts.
Read the insight →One is a discipline, the other a document - and confusing them shows up in every tender.
Read the insight →Why re-tendering pulls the wrong lever when supply is single-source.
Read the insight →When departments fight over a contract, look at their KPIs before their personalities.
Read the insight →A demonstration walks one of your own contract clouds through the lifecycle - and shows where the value sits.
See it working - book a demonstration