Lean and Six Sigma has its broad applications and success stories in oil & gas and Petrochemical industry by using principles of enhanced productivity, safety and environment as well as process quality management in a well-defined framework. It has widely being used in Various Industries and achieved a tremendous results using its statistical tool and techniques, which has resulted a huge reduction in the variance of the process plus the increase in the profit of the organization.

Six sigma with its statistical approach and DMAIC methodology has been implemented successfully in various fields to reduce the number of defects and to bring the quality level in the organization to its expected. Over the past years, the GCC (Gulf Cooperation Council) countries have experienced considerable growth in the oil and gas industry particularly exploration and production (E&P) activities. Oil and gas companies, in the UAE, have implemented an efficient and reliable framework associated with the safety and operational excellence. With new technical advances, cheap extraction of shale oil has now become possible. Hence, it becomes a necessity more than ever, to find an optimum way to stay competitive in the market. The question raised then is: which approach is most suitable or optimum for the framework required and how could it be achieved?

This framework must rely on efficient quality control and assurance methodologies such as Six Sigma, Lean and Kaizen to guarantee a position of being the largest global producer in the oil and gas business. While researching the prevalence of Six Sigma adoption among major oil and gas companies, we were surprised to find that a number of oil companies in the GCC such as, Abu Dhabi Company for Onshore Oil Operations, Abu Dhabi Gas Liquefaction Company, Saudi Aramco, Saudi Electricity Company, Kuwait Gulf Oil Company, Kuwait Petroleum Corporation, Maersk Oil Qatar, Medco Energy, The Bahrain Petroleum Company, etc...) have already established Lean Six Sigma practices in place which are used to address the new challenges they face. Oil and gas companies should be looking to be shielded against barriers imposed by the advent of new shale oil technologies and should also look to boosting their Lean Six Sigma operations, to ensure that full potential is reached as the energy industry is facing its future challenges head on.

Lean Six Sigma has been applied by companies in oil and gas industry to improve production, increase reliability and reduce costs while running safe operations. Too much waste, too much redundancy and lengthy turnaround times result in even the most efficient oil and gas companies failing to meet customer expectations 25-50% of the time. Lean Six Sigma can help in ensuring that customer expectations are met and potential savings of $100millions are realized. Despite some misconception that some managers have about the implementation of Lean, it will stay the most efficient methodology to apply in the oil and gas business. Success of Lean depends also on top management decisions. The application of these methodologies when applied successfully to projects can produce rewarding results.

Author :

Swaten Tiwari (Lean six sigma consultant - Trainee)