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Oil Industry Related Businesses Can Profit from Oil and gas Accounting Services

The petroleum industry can be a very demanding field. Whenever a company is working on exploration, extraction, refining or transporting, there are great stakes and often large financial risks involved. It doesn’t matter if a business is drilling into the ground to extract a product or if they are marketing the petroleum products themselves; all companies working in the oil industry should consider using an oil and gas accounting service.

Seeking professional gas and oil accounting  oil and gas courses in ghana   services can really help businesses working in any industry focus on their core priorities. Transferring a portion of financial responsibility to an accounting service can help relieve some of the tremendous burden off your company. This allows management to concentrate on the most lucrative parts of the business. Hiring an accounting service can also save businesses a lot of money in the long run because they don’t need to recruit, train and pay staff members that they’d otherwise use to handle the accounts. Hiring and training a staff that is dedicated to a company’s accounts is a very costly and a complicated process. Accounting for oil and gas should be left to the professionals so that businesses can do what they do best without having to worry if their finances are in good hands.

Professional accounting services can vastly improve productivity levels. Increased productivity often means increased money flow. By transferring the responsibility for accounting to professionals, leaders of a company will be better able to channel that energy into more profitable directions. A business might use these resources to focus on their customers, complete current projects or even explore new areas for revenue in the industry. Whatever a business decides to do with their new productive work environment is up to them; however, it would not be possible without hiring a professional provider of accounting for oil and gas.

By using an accounting service, oil and gas related businesses can become powerful contenders in their field. By freeing themselves from managing even more employees and vital financial records, companies can get more work done and cut down turn-around-time on projects. They can also benefit from an increased customer base. Customer satisfaction builds better relationships and is something that efficient accounting services can surely bring to the table.

It is easy to see how oil and gas accounting can be a worthwhile investment. It not only frees up valuable resources that can potentially make a business earn more, it saves money at the same time. A business can profit from a financial partnership in many ways. Choosing a reliable accounting service can help any business focus on other priorities and help them grow and succeed in a competitive market.

Oil and gas projects and services are capital intensive. Hence, financial capacity is essential to drive growth in the industry. Given the increased participation of domestic investors in Nigeria’s oil and gas industry, naturally, they have been saddled with the responsibility to provide the capital required to drive industry growth.

As at 2012, Nigerians had acquired from IOC’s about 80 of the OMLs/OPLs (30 percent of the licences) and about 30 of the oil marginal fields awarded in the industry. Dangote Group is currently undertaking a $14 billion refinery project, partly sponsored by a consortium of Nigerian banks. Another Nigeria company, Eko Petrochem & Refining Company Limited, is also undertaking a $250 million modular refinery project. In the midstream sector of the industry, there are many indegenous owned transport vessels and storage facilities; and in the downstream sector, domestic investors are actively involved in the marketing and sale of refined crude oil and its by-products through the filling stations located across Nigeria, which filling stations are mostly owned and funded by Nigerians.

Capital is also required to fund education and training of Nigerians in the various sectors of the Industry. Education and training are vital in filling the gaps in the country’s domestic technological and technical know-how. Thankfully, Nigeria now has institutions solely for oil and gas industry related studies. Furthermore, indigenous oil and gas companies, in partnership with IOC’s, now undertake pieces of training for Nigerians in different areas of the industry.

However, funding from the domestic investors is not adequate when compared to the financial needs of the Industry. This inadequacy is not a function of financial incapacity of domestic investors, but due to the overbearing presence of the FGN through the Nigerian National Petroleum Corporation (NNPC) as a player in the industry; in addition to regulatory bottlenecks such as pump price regulations that inhibit the injection of capital in the downstream sector.

Oil and gas projects are often highly technical and complex. As a result, there is a high demand for technically skilled professionals. To sustain the growth of the industry, domestic investors have to fill the capacity gap through training, hands-on experience in the execution of industry projects, management or operation of already existing facilities and obtaining the necessary international certifications such as ISO certification 2015 and American Society of Mechanical Engineers (ASME) certification. There are currently domestic companies that undertake projects such as exploration and production of crude oil, engineering procurement construction, drilling, fabrication, installations, oil by-products shipping and logistics, offshore fabrication-vessel building and repair, welding and craft sales and marketing. Recently, Nigerians participated in the in-country fabrication of six modules of the Total Egina Floating Production Storage Offloading (PSO) vessel and integration of the modules on the FPSO at the SHI-MCI yard.

Technological capacity in the oil and gas industry is primarily related to managerial competence in project management and compliance, the assurance of international quality standards in project execution and operational maintenance. Hence to build technological competency starts with in-country development of management capacities to grow the pool of skilled personnel. A particular research found that there is a vast knowledge gap between domestic companies and IOC’s. And ‘that indigenous oil companies suffered from fundamental lack of quality management, limited compliance with international quality standards, and poor preventive and operational maintenance attitudes, which lead to poor maintenance of oil facilities. ‘

To effectively play their role in enhancing the technological capacity in the industry, domestic companies started partnering with IOC’s in project construction and execution and operational maintenance. For instance, as mentioned earlier, domestic companies partnered with an IOC in the successful completion of in-country fabrication of six modules of the Total Egina Floating Production Storage Offloading (FPSO) vessel and integration of the modules on the FPSO at the SHI-MCI yard. Other instances include: the first assembled-in-Nigeria Subsea Horizontal Xmas Tree and the fabrication; installation of subsea equipment like flexible flowlines, umbilicals and jumpers on Agbami Phase 3 project; Installation of 32km 24″ Sonam to Okan NWP pipeline; the fabrication and load-out of the Okan PRP Topsides; Bridge Fabrication of Okan PRP jacket, amongst others.

It is common knowledge that since the enactment of the Nigerian Oil and gas Industry Content Development (NOGICD) Act in 2010, all projects executed across the sectors of the Industry have had the active involvement of Nigerians. The Act ensured an increase in technological and technical capacities, but also a gradual process of technology transfer from the IOC’s to Nigerians. The Act in its Schedule reserved specific Industry services to domestic companies. The rate of involvement and the quality of services of Nigerians has increased tremendously with the result that there are now many domestic oil servicing firms.

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