Strategic Management Report: An Analysis of Perenco Ltd's Operations

This report provides a strategic management analysis of Perenco Ltd, a multinational oil and gas corporation. It begins with an introduction to the oil and gas sector, highlighting its significance and the role of oilfield services. The report then justifies the selection of Perenco Ltd, emphasizing its operational strategies, acquisition-based growth, and strategic focus on marginal grounds. The core of the report focuses on the challenges faced by Perenco Ltd, including environmental concerns related to pipeline operations, transportation risks, and issues related to human rights and environmental impact in its operating regions. The report also touches upon challenges related to operational adaptability and cultural diversity. The report concludes by outlining the benefits that Perenco Ltd enjoys in the global market.

Running Header: Strategic Management
Strategic Management
Authors ID:
Authors Name:

Strategic Management
Contents
Introduction......................................................................................................................................3
Justification for the chosen company..............................................................................................3
Challenges faced by Perenco Ltd....................................................................................................4
Recommendations............................................................................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

Strategic Management
Introduction
Oil and gas is the sector which has been considered as one best industry all over the globe and
which is also recognized as a leading sector in the generation of the revenues for the economy.
Oil patch is the term which has been referred to the petroleum sector. The oil and gas sector has a
diversified range of operations and functionalities. These operations include number of global
process such as exploration, extraction, refining and transporting and also marketing of the same
products on the global level (Adewuyi & Oyejide, 2012). There are three major classifications
which are made in this industry and divide the same in upstream, midstream and downstream.
One of the prime segments in the petroleum sector is the oilfield equipment and services (OFS).
This segment has been referred to the products and the services which are associated with the
extraction and manufacturing process of petroleum industry. This sector is also recognized as the
upstream energy industry. Furthermore, it also includes locating the energy sources, data
management of energy, boring and creation evaluation and production services. The below
executed analysis has been summarized on the oil and gas sector and major focus has been
concentrated on the oilfield services. The selected oil field services is the Perenco Ltd which is a
well renowned brand name in the sector and the below summary has been analyzed on the same.

Strategic Management
Figure 1 Challenges faced by oil and field services
(Source: Challenges faced by oil and field services, 2017)
Justification for the chosen company
Perenco Ltd is a multinational corporation which is one of the leading brand names in the sector
of oil and gas. The business corporation is one of the well renowned names in Europe and is a
leading independent oil and gas company (Perenco 2017). The business entity mainly operates in
the extraction and production of oil and gas related processes and also has a well balanced
portfolio in manufacturing, exploration and development of assets all over the globe. The
business organization is originated by the adoption of the strategy of acquisition and strong
organic growth. ON the basis of th research it has been noted that at present Perenco
manufactures approximately 450 000 boepd, of which 250 000 boepd is net to the business
organization. The acquisition is the strategy which has majorly contributed towards the growth
of the business entity (Rothaermel, 2015). Moreover, the Group's strategy progressed with a
boost towards a hike in the manufacturing and assets, reintroducing licenses and safeguarding
added property for new survey and development opportunities (Perenco 2017). From the further

Strategic Management
survey it has been observed that Perenco now has a strong production base, development projects
and also a standard quality in the exploration aspects and the same has been maintained and
balanced in the portfolio. One of the key elements of the business entity’s policy is the reason for
operating its assets. The business corporation has been proven as a reliable operator and hence
will be proven a beneficial partner if chosen and also in maintaining the quality standards in the
safety and environmental aspects. Moreover it has also been observed that the petroleum sector
has been passing through a time of considerable changes. The business entity has always been
sprightly and practical which includes in response to the shifting sands of the external
environment. The business corporation have a varied range of competitive advantage but the
most advantageous which has been standing stands out in today’s new and still evolving scenario
is the business corporation’s strategic concentration on the exploitation of marginal grounds.
And for this highly innovative set of capabilities is required, which to date have ensured our
business is underpinned by strong production (Perenco 2017). The above mentioned are the
elements which can be considered as relevant reasons for selecting this company. The biggest
reason is the organizational culture is the adaption and coping up with the creative and
innovative solutions for the successful delivery of the products and the services.
Challenges faced by Perenco Ltd
Petroleum sector has been facing a crucial time and going through a tough phase. This time has
brought number of massive disruption and there is a lot of dependency on this sector. There are
number of micro and macro environmental factors which are affecting the trends of the industry
on global grounds. The sector has been contributing in a wider sense in the advancements and
growth of the economy (Anomohanran, 2012). There will be constant changes in the Petroleum
sector investments which are in the vitality renaissance. Accordingly, new creative outlines will
spill out of the upstream grounds towards the midstream foundation, refining processes, and
petrochemical offices. The Upstream services in the mentioned industry will focus on getting an
incentive from late exposures and attainments by making aid of the more productive
functionalities, taking a peek at measuring the hazards that the industry is facing and the use of
new mechanisms and developments. The oil and gas industries has been proven very much
beneficial for the industrial sector as oil and gas has been recognized as the one of the leading
revenue generator for the nation which has facilitated by a boost to the revolutionary concepts

Strategic Management
such as globalization and technological advancements (Aron, 2013). As mentioned in the above
analyzed scenario Perenco Ltd is an oilfield service provider. The business entity has been facing
number of issues which has been segmented in various divisions and the same divisions are
described as follows by making use of some examples:
In spite of the fact that the pipelines are made under the ground however this is additionally an
environmental issue. At times, organization has been liable of making the arrangements of the
petroleum which is found under the ground and that to without operating or cleaning (Harjoto &
Jo, 2015). The oil slicks from the pipeline and nobody can watch. Ordinarily, the pipeline does
not spill when contrasted with other transport but rather once they spill, they can harm immense
measure of oil in some time. It decimated the dirt and harms the homes of the general population.
In this way, this is the enormous test for the organization to manage the issue of pipeline spillage
(Wheelen and Hunger, 2017).
Despite the fact that the recurrence of rail mishaps is less yet when they happen, they are the
reason of gigantic property harm. Individuals in a few nations say 'bomb trains' to those rails that
vehicle the oils starting with one place then onto the next as they have enough capacity to
pulverize everything in one mishap (Hu and Xu, 2013). Further, another issue is that at some
point prepare goes by various urban areas which can hurt the nearby society. The issue is that the
timetables and courses of the trains are not uncovered. In such way, nobody can keep the
mishaps. Thus, this is the huge issue for the organization Perenco Ltd as transportation by the
train can be hazardous for both, organization and also the individuals. In this scenario the
challenge is that the organization needs to manage the mischances and keep the group from the
harm. The below presented are some of the examples which has been dictating the issues faced
by Perenco Ltd UK:
According to the research conducted it has been inferred that, Perenco are a free Anglo-French
oil and gas organization (Killing, 2012). Its base camp is situated in London however it
additionally has workplaces in Paris and the Bahamas. Established by Hubert Perrodo (1944-
2006), the organization is currently keep running by CEO, Jean-Michel Jacoulot, and still
halfway has a place with his eldest child, François Perrodo, the 173rd wealthiest man in France.
Perenco works in 16 nations, Central Africa (Cameroon, Gabon, Congo – Brazzaville,
Democratic Republic of Congo), Latin America (Guatemala, Belize, Colombia, Peru, Venezuela,

Strategic Management
Brazil) in the Mediterranean (Tunisia, Egypt, and Turkey), the North Sea, Australia and even in
Iraq. Perenco keeps up a position of safety, is for all intents and purposes missing from the media
and is moderately obscure to the overall population (Peppard and Ward, 2016). Without being a
"noteworthy component" in the exploration and manufacturing of hydrocarbons, it is all things
considered critical in its division, delivering around 250,000 barrels for every day and utilizing
more than 4000 individuals over the world. Its methodology has been to purchase and work
concessions, regarded non-productive by different organizations, with a specific concentrate on
nations tormented by human rights mishandle and ecological issues (Mitchell, Marcel and
Mitchell, 2012). This report comprises of the impacts of Perenco's essence in Guatemala through
its backup Perenco Guatemala Limited (Perenco GL). It features the legitimate weaknesses of its
current working agreements and the social and human rights infringement connected to the
nearness of the organization (Platformlondon 2014). The present status of global law offers
neither the United States nor the universal group the way to manage the activities of
multinational enterprises who work in a few nations. The self-rule of this corporate body, and
additionally its restricted awareness of other's expectations, keeps us from considering the
organization responsible for the ecological and human rights infringement submitted by its
backups. With the present lawful structure, casualties must choose between limited options other
than to apply to the court of the nation where the auxiliary works. Given the solid ties between
remote organizations and host states and their frail lawful framework, they get just too little pay
for the mischief they have experienced (Hill, Jones and Schilling, 2014). This report attempts to
represent the absence of access to equity for the general population in Guatemala. It additionally
bolsters the EU battle that elevates access to equity for casualties of human rights infringement
in nations where multinational organizations are found. Moreover, the further are some of the
challenges which can also be faced by the business entity.
According to the author it has been noted that over adaptability in functionalities and business
operations can come about into significant disarray in upstream tasks. A legitimate coordination
is required by every one of the sections in the organization for completing urgent and complex
tasks in oil and gas sector (Ovadia, 2012). Furthermore, subsequently the business organizations
can be demonstrated as a test for dealing with a harmony between traditional approach and
adaptability and the same can be utilized for the execution of the considerable number of
achievements of the functional practices. Furthermore, thus it is the obligation of the senior

Strategic Management
authorities and of the managerial staff of maintaining a strategic distance from any odds of
disarray inside the hierarchical structure and the operations did.
An observation has been done that the organizations having and trading in fluctuated working
societies are required to have varieties in the qualities, ethics and standards and furthermore the
functional practices and exercises (Shuen, A., Feiler, P.F. and Teece, D.J., 2014). The business
associations are empowering the representatives that too from various substances for cooperating
in order to build up a feeling of co-appointment. In any case, according to the review it has been
watched that varieties in culture and qualities can really make challenges for the association in
keeping up coordination among the workers. Accordingly, it can likewise make real effect on the
viability of the operational strategy. Various undesirable circumstances and issues can be created
in the authoritative structure and furthermore correspondence holes can be produced because of
the social contrasts in the business substance.
Figure 2 Challenges faced by oil and field services
(Source: Challenges faced by oil and field services, 2017)

Strategic Management
Benefits to Perenco Ltd
As the business corporation has been operating the all over the globe the benefits are varying in
nature as per the change in the locations to locations. The business entity enjoys a huge market
share and which has been proven as one of the biggest benefit for the business entity. The larger
the market share is, the more the segments of the consumers will be. As the entity is having a
well renowned image in the sector the entity will also be enjoying a high level of brand equity.
Perenco Ltd has been experiencing a number of benefits and the same has been explained as
follows:
In the past era the execution of trading and business operations was done through offline
mediums only i.e. only the trading and distribution of goods was done in the physical markets.
The consumers were required to approach the retailers and the wholesalers for purchasing the
products .i.e. the oil as per their needs and requirements (Yan and Luo, 2016). But after the
emergence of the revolutionary concept of e-business and e-commerce, the scope for the
consumers has increased as the products are now made available on the official websites and
portals. This has made an increase iin the demand fr the products and which has been proven as a
benefit for Perenco Ltd also.
The concept is concerned with the innovation which has been made on the basis of increasing
and distinct demands raised by the consumers. On the basis of this approach, consumers are
required to serve the reviews and feedbacks concerning to the products and the services offered
by the business corporation. On the basis of their reviews and feedbacks, the business
organization will be making advancements and improvements in the existing products and
services so as to fulfill their needs and demands of the consumers. A high level of satisfaction
will be proven very much beneficial for the business entity as it will develop and increase the
number of loyal customers and increased profitability will be experienced.
Strategic plan
The business entity is required to make adoption of number of approaches and strategies for
making amendments or rectifying the issues or the challenges faced by Perenco Ltd:

Strategic Management
One of the biggest issue faced by the business corporation are the environmental problems and
the challenges which are occurring due to the underground pipelines. The business entity should
make enhance the quality of the materials used for building the pipelines. Any sought of eco-
friendly material should be used which will bring a decline in the degradation of the soil and
land.
Moreover, the manufacturing and digging and oil rigs should be built far away from the
residential areas. The emission of the scrap and oil extracts should be made in a dumping area
and a purification plant should also be installed for purifying the extracted material for re-use.
Recommendations
In general, for bringing advancements and improvements in the strategic directions Perenco Ltd
is required to make provisions of adequate training sessions and organizing activities and
campaigns should be done. These campaigns should include various practices and activities
regarding the use of equipment and tools. The training sessions can also focus on making the
labors and lower staff employees to learn communication skills which will enable them to
communicate and convey their messages to the upper level staff. This will be proven a, integral
initiative by the management which will largely contribute in the development of strategic
directions. Perenco Ltd should execute a deep and detailed survey over the capacity and
offerings of the other associated organizations so as to develop relations and building agreements
for business purpose. This will enable the entity to adapt the advancements and the
mechanizations of the other organizations. Parenco Ltd will be benefited on various grounds by
pooling the assets. This will lead the entity in bringing developments and high level of success
and growth will be attained with an improved strategic direction. Moreover, the entity should
take some initiatives regarding adoption of some safety and health policies and standards. There
should be implementation of some restrictions and norms should be imposed over the emission
of pollutants in the environment. This will improve and build a strong image of the business
corporation in the society which in-turn will lead to an increased goodwill and market share. The
clients will be more confident and brand loyalty will be enhanced.
Conclusion
After summing up the above report it has been concluded that the oil and gas sector is the one of
the industrial sector which has been recognized as the leading revenue generator for any of the

Strategic Management
economy. The report above presented report has been focused on the oilfield services which are
one of the integral business segments of the oil and gas sector. The selected oilfield service
provider is Perenco Ltd. The business corporation has been involved in the operations of
extraction and exploration of oil and gas products. Moreover the report has been concentrated on
the strategic management of the operations and the functionalities which are executed within the
organizational structure of Perenco Ltd. Furthermore, the report also comprises of a justification
which has been presented for explaining the choice made for Perenco Ltd for the mentioned
scenario. The report also includes an analysis which has been executed on the challenges which
are faced by the business entity while operating the business. This analysis also comprises of
some of the examples which are dictating the problems faced by Perenco Ltd. And at tlast
recommendations has been made for bringing improvements in the strategic directions.

Strategic Management
References
Adewuyi, A.O. & Oyejide, T.A., 2012, “Determinants of backward linkages of petroleum sector
in the Nigerian economy”, Resources Policy, vol. 37 (4), pp.452-460.
Anomohanran, O., 2012. Determination of greenhouse gas emission resulting from gas flaring
activities in Nigeria. Energy Policy, 45, pp.666-670.
Aron, L., 2013. The political economy of Russian oil and gas. American Enterprise Institute for
Public Policy Research.
Eden, C. and Ackermann, F., 2013. Making strategy: The journey of strategic management.
Sage.
Harjoto, M.A. & Jo, H., 2015, “Legal vs. normative CSR: Differential impact on analyst
dispersion, stock return volatility, cost of capital, and firm value”, Journal of Business
Ethics, vol. 128 (1), pp.1-20.
Hill, C.W., Jones, G.R. and Schilling, M.A., 2014. Strategic management: theory: an integrated
approach. Cengage Learning.
Hu, D. and Xu, S., 2013. Opportunity, challenges and policy choices for China on the
development of shale gas. Energy Policy, 60, pp.21-26.
Killing, P., 2012. Strategies for joint venture success (RLE international business) (Vol. 22).
Routledge.
Mitchell, J., Marcel, V. and Mitchell, B., 2012. What next for the petroleum sector?. Chatham
House.
Ovadia, J.S., 2012. The dual nature of local content in Angola's petroleum sector: development
vs. elite accumulation. Journal of Contemporary African Studies, 30(3), pp.395-417.
Peppard, J. and Ward, J., 2016. The strategic management of information systems: Building a
digital strategy. John Wiley & Sons.