OEUK news

New: Shell – Logistics/Material Management optimisation Initiatives

9 August 2018


  • To provide a summary of some of the initiatives Shell has been involved either as a participant or leading with other O&G operators and our key suppliers.

Initative overview

  • In the last 5 years, the Logistics Fit for Future (FFF) journey to date has involved a re-thinking of the way in which we work internally and how we collaborate externally with the rest of the supply chain.The total Shell Logistics cost has decreased by a factor 2 thanks to the following initiatives:
    • Internal: review fit for purpose specification for vessels, aggregate demand into integrated planning for Projects, Wells and Production helping to improve Logistics asset utilization
    • External: sharing agreements in place for Marine (ERRVs and PSVs), Aviation fixed wing and Warehousing with other O&G operators.
    • Contracting: develop further output based contracting with fair risk allocation and performance incentive scheme.

Impact/Discussion points 

  • The challenge is to bring collaboration across the industry to the next level under the banner of ETF Logistics. The following initiatives will be pursued among others:
  • UKCS PSV marine pooling
  • Program to reduce Logistics GHG emissions including LNG bunkering
  • Technology – Digital supply chain – now starting to replicate best practices from other Shell operating units and implement in UK. It will include Track and Trace and End to End Supply Chain Visibility.
  • Systematic value/waste mapping to instil a culture of continuous improvement and holistic thinking across the supply chain

Total savings achieved

> 50 mln USD

Share this article

Working together, producing cleaner energies