Ogdcl strategy planning
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OGDCL strategy planning
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Ogdcl strategy planning
- 2. Term Presentation Managerial Policy Presented By AbdulBaseer Tokhi GR # 112003
- 4. National Oil & Gas Co. of Pakistan. Flagship of the country’s E&P sector. Market leader in terms of reserves, production and acreage. Listed on four stock exchanges: Karachi Stock Exchange (KSE) Lahore Stock Exchange (LSE) Islamabad Stock Exchange (ISE) London Stock Exchange (LSE) Registered Office OGDCL House, Plot No.3, F-6 / G-6, Jinnah Avenue, Blue Area, Islamabad.
- 6. Membership PIP (Petroleum Institute of Pakistan) PPEPCA (Pakistan Petroleum Exploration and Production Companies Association) MAP (Management Association of Pakistan) SPE (Society of Petroleum Engineers) PAPG (Pakistan Association of Petroleum Geoscientist) WWF (World Wild Fund) WEC (World Energy Council) Awards 30th Corporate Excellence Award 2014. 29th Corporate Excellence Certificate (Map) 2013. CSR Business Excellence Award 2013. Environment Excellence Award 2008-2013. Best Corporate Reports Award 2007-2012. www.ogdcl.com/UploadFolder/fina ncial/32.DirectorsReport.pdf
- 7. Vision To be a leading multinational exploration and production company. Mission To become the leading provider of oil and gas to the country by increasing exploration and production both domestically and internationally, utilizing all options including strategic alliances. To continuously realign ourselves to meet the expectations of our stakeholders through best management practices, the use of latest technology, and innovation for sustainable growth, while being socially responsible.http://www.ogdcl.com/ContentPage?id=9D pk%2bgUmFnmrPxq7ZKqqJA%3d%3d
- 8. Net gas production from 1,173 MMscfd in FY 2014 to 1,311 MMscfd in FY 2015. Net oil production from 41,330 bpd in FY 2014 to 44,732 bpd in FY 2015. Increase the number of rigs that we contract from third parties. Expect to achieve total average production of 283,096 boepd in FY 2015. Added 29 new licenses to our exploration portfolio. For FY 2015 19 exploration and appraisal wells, and 16 development wells are targeted. Plan to increase our 2D and 3D onshore seismic surveys in FY 2015 to 2,745 L. km and 2,075 sq. km.http://www.ogdcl.com/ContentPage?id=9D pk%2bgUmFnmrPxq7ZKqqJA%3d%3d
- 9. OGDCL's key competitors in the exploration business include: BP Plc (BP.L) Pakistan Petroleum Ltd. (PPL.KA) Pakistan Oilfields (PKOL.KA) Italy's ENI (ENI.MI). http://www.ogdcl.com/ContentPage?id=9D pk%2bgUmFnmrPxq7ZKqqJA%3d%3d
- 12. Component Yes/No Customer No Product Yes Market Yes Technology Yes Survival Growth Yes Philosophy Yes Self-Concept Yes Public Image Yes Employees Yes
- 13. Products/services: oil and gas Markets: to the country Technology: the use of latest technology Survival Growth: To continuously realign ourselves to meet the expectations of our stakeholders Philosophy: use of latest technology, and innovation Self-Concept: To become the leading provider of oil and gas to the country Public image: while being socially responsible. Employees: best management practices
- 14. To become the leading provider of oil and gas to the firms and individuals of the country by increasing exploration and production both domestically and internationally, utilizing all options including strategic alliances. To continuously realign ourselves to meet the expectations of our stakeholders through best management practices, the use of latest technology, and innovation for sustainable growth, while being socially responsible.
- 15. Economic Forces Crude Oil Prices, Exchange rate Social, Cultural, Demographic and NE Forces Political, Governmental, and Legal Forces Legislation, Law and Order Technological Forces Competitive Forces BP.L Pakistan Petroleum Ltd Pakistan Oilfields Italy's ENI
- 16. Competitive Profile Matrix Critical Success Factor Weight Rating Score Quality 0.15 3 0.45 Financial Position 0.25 4 1 Market Share 0.30 3 0.9 Management 0.20 3 0.6 Global Expansion 0.10 2 0.2 Total 1.00 3.15 Weight Rating Score 0.12 3 0.36 0.22 2 0.44 0.29 2 0.58 0.27 4 1.08 0.11 1 0.11 1.00 2.57 OGDCL NR
- 17. External Factor Evaluation Matrix Opportunities Weight Rating Score Mergers or strategic alliances 0.10 2 0.20 Market vacated by an ineffective competitor 0.13 3 0.39 Workshops for training and development 0.16 2 0.32 Support of the Ministry of Petroleum & NR. 0.12 3 0.36 Threats Weight Rating Score Price wars with competitors 0.09 3 0.27 Tuff Competition 0.12 2 0.24 Globalization that bring strong companies in PK 0.20 3 0.60 Competitors have superior access to channels of distribution .08 2 0.16 Total 1.00 2.54
- 18. STRENGTHS ARE: Largest Oil and gas company in the Pakistan. Monopoly of the company and having confidence due to government support. Dynamic & Strong Financial Position due to the 45 years’ experience. A new, Exploration and innovative of Wells. Best location of business which is choosing after long process. Quality processes and procedures. Large number of field of oil and gas. Experienced and Technical Staff involving no. of expert Geologist. Confidence of the Customers.
- 19. WEAKNESSESS ARE: Lack of marketing expertise. Undifferentiated products (i.e. in relation to the competitors) Lack of coordination of operations. Government Influence. Untrained Staff. Slow promotion process which reduces the performance. Lack of Check and balance. Weak quality products (can be only one of more than one).
- 20. Internal Factor Evaluation Matrix Strengths Weight Rating Score Monopoly of the company 0.18 4 0.72 Dynamic & Strong Financial Position 0.16 3 0.48 Quality processes and procedures 0.13 3 0.39 Confidence of the Customers 0.12 2 0.24 Weaknesses Weight Rating Score Undifferentiated products 0.10 3 0.30 Slow promotion process 0.12 3 0.36 Government Influence 0.10 2 0.20 Lack of coordination of operations. 0.09 2 0.18 Total 1.00 2.87
- 27. 68% 69% 70% 71% Gross Profit Margin 70% 71% 69% 2011-12 2012-13 2013-14 35% 40% 45% 50% Net Profit Margin 49% 41% 48% 2011-12 2012-13 2013-14 0% 10% 20% 30% 40% 50% DuPont Analysis 42% 32% 35% 2011-12 2012-13 2013-14 www.ogdcl.com/UploadFolder/fina ncial/32.DirectorsReport.pdf
- 28. 0 2 4 6 8 Current Ratio 6.67 2.3 4.04 2011-12 2012-13 2013-14 0 2 4 6 8 Acid Test Ratio 6.26 2.01 3.65 2011-12 2012-13 2013-14 0% 50% 100% 150% CFO to Sales 59% 125% 63% 2011-12 2012-13 2013-14 www.ogdcl.com/UploadFolder/fina ncial/32.DirectorsReport.pdf
- 29. 0 50 100 150 200 Debtor Turnover in Days 200 158 111 2011-12 2012-13 2013-14 50% 52% 54% 56% 58% 60% 62% 64% 66% Total Assets Turnover Ratio 66% 59% 56% 2011-12 2012-13 2013-14 www.ogdcl.com/UploadFolder/fina ncial/32.DirectorsReport.pdf
- 30. 0 5 10 15 Price Earning Ratio 7.12 10.78 9.07 2011-12 2012-13 2013-14 0% 1% 2% 3% 4% 5% Dividend Yield Ratio 5% 4% 4% 2011-12 2012-13 2013-14 0 1 2 3 4 Dividend Coverage Ratio 3.11 2.57 3.11 2011-12 2012-13 2013-14 www.ogdcl.com/UploadFolder/fina ncial/32.DirectorsReport.pdf
- 31. To enhance its reserves and production profile and ultimately maximize value for shareholders up to 2018. To improve reliability and efficiency of supply to the customer. Maintain Low Cost Operations by 2020. To excel in exploration, development and commercialization. Pursue Selective International Expansion. To improve internal business decision making and strategic planning through state of art MIS by 2017. To build strategic reserves for future growth / expansion by 2019. Accelerate Production Growth. www.ogdcl.com/about-us/Strategy.htm www.ogdcl.com/UploadFolder/financial/MDRe vwt2011.pdf www.ogdcl.com/UploadFolder/financial/32.Dire ctorsReport.pdf
- 32. SWOT Analysis is conducted to identify the organizational strengths (S), organizational weaknesses (W), environmental opportunities (O), and environmental threats (T). Each analysis helps to know that how these elements influence organizational performance.
- 33. SWOT Analysis with Actions Strengths • Highly Skilled Professionals • Vast Experience • Joint Ventures with Foreign Oil Companies Working in Pakistan • High market cap and revenue Weaknesses • Political Influences • Limited Customer • Limited Marketing Opportunity • Inadequate Financing for off-shore drilling Opportunities • Expansion towards a multinational Company • Expansion towards Exploration & drilling Activities • Marketing Opportunity for LPG & Sulphur • Off-shore drilling Maximize strengths to take advantage of opportunities • Strong Marketing campaign through distributors to make people aware of LPG • It should go for countries such as Mexico, Saudi Arabia, and Russia where there is a room for O&G Co. • Bring new finance through bonds for expansion of drilling activities Resolve weakness, take advantage of opportunities • Find new markets such as Mexico, Saudi Arabia, and Russia. There are too many customers • Marketing of the products should be done appropriately • New stocks should be brought in to finance the off-shore drilling Threats • Latest Technology • Unproductive wells • World Market • Safety Issues / Tribal Issues Maximize the strengths to mitigate threats • Have proper safety system for the workers on site • Joint venture with foreign companies to make wells productive • Improve the public image to have more options for financing new technology Minimize weaknesses to reduce threats • Reduce the political influences on the mgt • Acquire new technology for drilling purpose. • Remove political influences to concentrate on world market
- 34. It aims to identify high-growth prospects by categorizing the company's products according to growth rate and market share. By optimizing positive cash flows in high-potential products, a company can capitalize on market-share growth opportunities.
- 36. The Internal-External (IE) matrix is another strategic management tool used to analyze working conditions and strategic position of a business. The Internal External Matrix or short IE matrix is based on an analysis of internal and external business factors which are combined into one suggestive model.
- 37. EFE = 2.54 IFE = 2.87
- 38. It is a high-level strategic management approach for evaluating possible strategies. Quantitative Strategic Planning Matrix (QSPM) provides an analytical method for comparing feasible alternative actions. The QSPM method falls within so-called stage 3 of the strategy formulation analytical framework.
- 39. QSP Matrix Weight Attractiveness Score Total Attractiveness Score Attractiveness Score Total Attractiveness Score Strengths • Monopoly of the company • Dynamic & Strong Financial Position • Quality processes and procedures • Confidence of the Customers 0.18 0.16 0.13 0.12 3 4 2 3 0.54 0.64 0.26 0.36 2 3 4 3 0.36 0.48 0.52 0.36 Weaknesses • Undifferentiated products • Slow promotion process • Government Influence • Lack of coordination of operations. 0.10 0.12 0.10 0.09 2 3 4 1 0.20 0.36 0.40 0.09 3 3 2 1 0.30 0.36 0.20 0.09 Opportunities • Mergers or strategic alliances • Market vacated by an ineffective competitor • Workshops for training and development • Support of the Ministry of Petroleum & NR. 0.10 0.13 0.16 0.12 3 4 2 2 0.30 0.52 0.32 0.24 2 2 2 3 0.20 0.26 0.32 0.36 Threats • Price wars with competitors • Tuff Competition • Globalization that bring strong companies • Competitors have superior access to channels of distribution 0.09 0.12 0.20 0.08 3 2 2 4 0.27 0.24 0.40 0.32 3 2 4 3 0.27 0.24 0.80 0.24 Sum Of Total Attractiveness Score 2.00 5.46 5.36 Market Development Market Penetration
- 40. Strategic Alliance agreement can be made with: Pemex in Mexico Aldress in Saudi Arabia Northgas in Russia Global Business Management System (expansion in ERP) Capital Expansion through Retained Earnings and Issuance of Corporate Bonds Strong infrastructure for communication purpose Expatriate Management (hiring for this purpose)
- 41. Thank You