Forum Discussion Week 4: Strategic recommendations to enhance Independent Oil and

Gas Companies pro-activeness

Independent oil and gas companies play a very important in enhancing stability and agility in the
energy sector. Basically, independent oil and gas companies (the independents) such as Hess
Corporation and EOG Resources Corporation are non-government companies operating mostly
at the wellhead and exist without any retail outlets. Inkpen and Moffett (2011) insist that such
companies get most of their revenues from exclusive marketing or refining operations,
exploration or production independently in the industry. However, to enhance their
competitiveness and sustainability, independent oil and gas companies can consider the
following strategic recommendations in their key operational areas;

Product Supply and Marketing

The supply chain is an important aspect of independent oil and gas companies as it helps get the
right product in the market, in the right form at the right form. Therefore, effective product
supply and marketing is essential for the companies to stay sustainable and competitive. In that
aspect, independent oil and gas companies should focus on product diversification amidst the
changing market environment in the oil and gas sector. The companies should focus on a wider
product portfolio beyond fossil fuels to include renewable sources of energy such as solar and
wind energy for long-term sustainability in the industry. This not only diversifies revenue
patterns but also helps meet changing customer demands and greater contribution to
environmental sustainability (Lee & Ho, 2022). Additionally, the companies should also leverage
on strategic partnerships to penetrate markets with ease and create new revenue streams.
Collaboration with downstream companies in manufacturing and petrochemical sectors is crucial
in developing customized products and offerings to strengthen their market position and growth
opportunities.

Revenue Generation

To enhance revenue growth, independent oil and gas companies should develop new business
models and explore new markets. Particularly, these companies should focus on production and
exploration on untapped regions to avoid geopolitical risks in concentrated regions and diversify
their resource base (Animah & Shafiee, 2020). Moreover, a focus beyond upstream to include
downstream and midstream activities such as pipeline and retail distribution is important to
enhance stable cash flows and create a defensive mechanism against oil and gas price volatility
(Basile et al., 2021).
Technologies, Research and Development

Investment in technology, research and development is paramount for any company to remain
innovative, maintain operational efficiency and stay competitive. Independent oil and gas
companies can leverage the benefits associated with data analytics, machine learning and
digitization to increase asset lifespan, recovery rates and optimize reservoir management.
Similarly, implementing technologies such as AI-driven solutions and robotics is crucial in
optimizing production outputs and refining processes to reduce costs and increase profitability
(Niyazbekova et al., 2021). Moreover, investment in research & development strategies such as
renewable energy solutions and carbon capture and storage can enhance sustainability in energy
integration and future proof activities aligned to the global goals on climate change. Companies
should also collaborate with academic, government and research agencies to enhance knowledge
transfer in such important areas.
 References

Animah, I., & Shafiee, M. (2020). Application of risk analysis in the liquefied natural gas (LNG)
sector: An overview. Journal of Loss Prevention in the Process Industries, 63, 103980.
Retrieved from https://www.sciencedirect.com/science/article/pii/S0950423019301421

Niyazbekova, S. U., Ivanova, O. S., Suleimenova, B., Yerzhanova, S. K., & Berstembayeva, R.
K. (2021). Oil and gas investment opportunities for companies in modern conditions. Socio-
economic systems: Paradigms for the future, 669-676.

Lee, C. C., & Ho, S. J. (2022). Impacts of export diversification on energy intensity, renewable
energy, and waste energy in 121 countries: Do environmental regulations matter?. Renewable
Energy, 199, 1510-1522.

Basile, V., Capobianco, N., & Vona, R. (2021). The usefulness of sustainable business models:
Analysis from oil and gas industry. Corporate Social Responsibility and Environmental
Management, 28(6), 1801-1821. Retrived from
https://onlinelibrary.wiley.com/doi/abs/10.1002/csr.2153

Andrew Inkpen & Michael H. Moffett (2011); The Global Oil & Gas Industry Management,
Strategy & Finance. Publisher, PennWell Corporation 1421 South Sheridan Road Tulsa,
Oklahoma 74112-6600 USA 800.752.9764