Procurement cooperation resulted in cost saving of US$60.6 million in H1

The country's oil and gas contractors managed to cut their operational costs up to US$60.6 million the first semester this year thanks to cooperation in goods and services procurement.

Oil and gas upstream sector regulator BPMIGAS has created the so-called Consultative Forum of Goods and Services Procurement to boost cooperation among the contractors in procuring goods and services -- a measure aimed to cut costs.

?The amount of cost saving during the first semester of year is almost the same as that of the whole year 2009 which reaached $61.93 million. That means total cost saving this year is likely to surpass the amount reached last year,? Agus Suryono, BPMIGAS's head of public relations, security, and formality division, said in Jakarta on Wednesday.

He said that the procurement cooperation in Working Area I, which covers Natuna, central Sumatra, south Sumatra, and Offshore North West Java (ONWJ) had resulted in a cost saving of $14.65 millon. Cost saving in Working Area II covering East Java and East Kalimantan amounted to $26.50 million.

According to him, cost saving resulting from the optimum use of assets through material transfer and the use of used material in both Working Areas I and II amounted to $19.45 million.

Last year, cost savings in Working Area I reached $20.22 million, Working Area II $15.20 million, while savings from the use of materials reached $26.51 million.

Currently, the scope of cooperation among the contractors includes the joint utilization of stores and facilities, sea and air transportation, joint 3-D seismic survey, and joint contracts on the use of rigs to drill or workover.

He noted that contractors of Working Area I had signed a memorandum of understanding on online services of integrated data that can further improve the efficiency of goods and services procurement administration. (bernard)