Analysis Of The Oil Industry In Nigeria

Analysis Of The Oil Industry In NigeriaOil and be adrift (OG) exploration and convergenceion (EP) instanteradays destiny immediate thought of a range of economical, accessible, political, and milieual concerns. As brawn requires keep on growing, OG companies should finalise and produce growing quantities of anele color and gas. Although doing so require more than(prenominal) than than tho ramping up fruition from traditional sources, to carry out favourable merchandise scheme epitome and research you would requisite genius of the marketplace placeing tools which is infestation model in accessing the coarse embrocate and gas environment and have an overview and judgement market growth or decline, business position, potential and direction for trading operationsCompetition in the unsmooth and gas patience in Nigeria is rattling intense and competitive over the year at that place has been troops of multinational company lobbing to be able to export c rude for meliorate and put to work in choke to the country tho that has proved impossible as the NNPC is run and controlled by the Nigerian organisation and it accounts for roughly 70 % of the governing body revenue and 40% of the country revenue the flagellum is minimum only if there is more than pressure on them as they lose a lot in export crude and they determine the legal injury, which almost crude anele and gas companies in Nigeria ar trying to change that the government overstep unsanded(prenominal) respected company license to export crude for refining and aim in back to the country for sale ca recitation moreover when few player can only bring in beautiful crude and atomic number 18 subject to quantity and cannot export crude. In novel snips competition in the international anoint color and gas industry has been increasing rapidly due to globalisation. Mergers and acquisitions between major players have been fetching place with a view to me liorate their competitive edge and fortify their position in this industryPolitical constituentsPolitical issue has evermore been an issue in the oil rich state in Nigeria, there has been political inst exp one(a)nt in the oil rich region where the give notice is macrocosm pull uped, as the government officials are demoralise and refuses to develop and give strict body that works in cleaning up of the oil spillage, this had bring up unrest in the region as the youthfulness in the area has picked on arms and militancy kidnapping for interchange b embarrasseding up of oil pipe line and engage in oil bunkeries, this has affected oil yieldion and transportation and has much doing on NNPC as is crude and oil yieldion has gone to a move into low. The political unrest involves to be addressed if the government wants composed flow of oil and peace in the region.Economic factorsThe economical sort out down in the foundation affected e actu eachy part of the homo and the o il industries, and the Nigeria banks is under red reform as the central bank of Nigeria listed about eightsome banks in the country of un serviced lend and debts, and with the sacking of directors of eight to banks in Nigeria this has displace a shocking wave to the banking industries and are refusing to give out loan to companies and individual, even the oil marketers obtaining a loan in the banks have pass problem, the refusal of banks to fund importation of products and the alleged inability of the Nigerian National rock oil Corporation (NNPC) to pay for products it received from its opposed suppliers of crude, has affected the country deli very as there is scarcity of fuel for consumer lots of cues in stations. This is bear on the prudence as the legal injurys and black market luming businesses cant operate properly. societal factorsThe 21st century has witnessed a growing Nigerian economy, various projects are ongoing in Nigeria with solid infrastructures. This econom ic growth is having a broad wallop on the Nigerian people many Nigerians can forthwith afford cars, both used and newfound. Many Nigerian are now moving to a cleaner source of verve to cook, which is natural gas. This economic growth cogitate that more Nigerians are driving leading to a higher number in the demand of energy compared to the past decade. The social factor is a good level of improvement that the NNPC need to introduction and use the advantages in and bringing in new market and improving breathing products.TechnologyTechnology is a major issue in the Nigeria industries and specially the oil and gas industries the refineries we have in Nigeria has been wee-wee since the seventies and has not been improved and still lack a lot of new technologies and that why it has not been in operation over a decade. improve in the applied science aspect take into account for be a good thing if the country goes into technology revolution as this depart bring in new ideal s and new technology in the operation of crude and the introduction of LNG liquefied natural gas which has been the world focus deep as an alternative to fuel. There has been major growth and improvement in technology as a whole in the country which go forth bring positive influences in NNPC and the oil industry as a whole cause it forget military service in maximising clear and efficiency.The oil and gas industryThe oil and gas industry is a key part of the economic growth in Nigeria, the industry is very competitive and a bit risky, and the room for new entrant to the market is very tough and exploiting as the industry is a bit corrupt obtaining a license is very laborious as well as being a major player in the industry is very tough, because NNPC is the biggest player in the industry in the country it tends to hold it ego up with government policies. But NNPC still need to work hard in keeping it customers and in former(a) to do that they have built various petrol station s in the country.New entrants to the marketThe energy industry is oligopoly at the upstream level, where as in the downstream level it could be said to be a perfect competition because there are many buyers and dealers and consumers are imparting to pay a price for the products. NNPC to some extent determine the price but to the public no organisation can determine the price it. The industry is complex heretofore delicate entry into the industry in the upstream sector is tall(prenominal) while in the downstream it is fair to some extent but still difficult to obtain license.Product life cycle of oilThe oil life cycle is said to be 50 historic period more to many analyst, as demand for energy continues to grow, new sources of oil and gas (OG) must be found and produced. Challenges for exploration and production (EP) now and into the foreseeable future include the deployment of new or newly sufficient EP technologies, evolving environmental laws and regulations that vary among ( and within) nations, socioeconomic concerns, and providing adequate re enchantments to investorsEnvironmental factorsEnvironmental factor is a major issue in the world today as the issue of climate change is a major concern the oil and gas industry which is one of the worst polluters of c02 emission , the world is undergoing shimmy to a low carbon copy economy which is switching to bio-fuel, and LNG, NNPC has always taking this into consideration but has not taking drastically some steps in fashioning sure that is a major player in the transformation of Natural Gas/LNG leave play a all-important(a) role in enabling transition to a low carbon economy a goal accepted by the international community. For this to go through a global competitive gas market is in the interests of all stakeholders. It is therefore felt that the role of the Gas Exporting Countries Forum go away be very crucial in enabling a global and competitive gas market and it will only grow in stature and impo rtance as a cartel which NNPC would be a key player. And is working to have a big market on LNG.Introduction of new trade strategy and how it will implemented with NNPC. starting time before bringing a new merchandising designing and strategy you would need to carry out a SWOT analysis of NNPC, in other for us to determine the strength, weakness, opportunity and threats, later on access this factors we would break a recommendation and implementation of the four marketing P and marketing mix.SWOT analysis of NNPCStrengthNNPC has been operating for a long time is main strength is that it is being backed and run by the government. secondly it is the only company that is allowed to export crude for refining and bring it back to the country before distribution to marketers, it almost work with all the oil company in Nigeria and have six joint venture with foreign companies. NNPC has a play a big part in aspiration of the price in Nigeria, NNPC has various subsidiaries including pet rol stations. And NNPC has a good defacement name and has been working hard in improving its process and products.impuissanceNNPC has lots of weakness first it needs to work on its refinery as this has stop working for over a decade that is why they resulted in exporting crude for refining and import back to the country, if they fix the refinery it will save constitute, risk of transportation as well as NNPC making on lost on the bye products of refining process which they would sustain lots of coin from and open a new market. Secondly woeful solicitude decision and stingy interest from the government officials in devote of overseeing NNPC personal business. They dont have penetration in the foreign market. fortuneWith the current state and stage of the market NNPC has lots of opportunity if only they could reinstall its refinery. An oil refinery or oil colour refinery is an industrial process prove where crude oil is processed and refined into more useful fossil oil pro ducts, such as gasoline, diesel fuel, asphalt base, heating oil, kerosene, and liquefied petroleum gas. NNPC would have lots on market on those waste product listed above which they are losing by exporting crude for refining. And also would contribute them a key player in the transformation to a low carbon economy if they increment is market on LNG and refine is product in the country. And this will increase its revenue and the country economical impact will be more as it will provide more jobs and safety to the public.ThreatsThe threats in the oil industry anywhere in the world is always very intensive, similar the global climate change which is one of the most threat forcing companies to try and find another market in the oil industries, this will lead to decline in production of crude as well as reducing profit. Secondly it is been speculated that oil has reached its picked and is got about 50years left before it goes dry, that is anither threat which direction NNPC should be expression for other market apart from fuel and kerosene importation. Another major threat is Ghana which has just discovered fuel on its soil, if Ghana build a refinery with new technology and international standard it will increase the threat of other oil companies breaking a deal to extract and import crude to Nigeria.The main tendency of the SWOT analysis is to turn weaknesses into strengths, turn strengths into opportunities, use our strengths to profit from our opportunities.Action computer programsAfter carefully looking at the affair and doing a research on NNPC and with the mug up analysis looking at its opportunity and is weakness NNPC has a refinery which was built in the 1970s but has stopped working due poor trouble decision and selfish interest from the government officials in charge of overseeing NNPC affairs poor maintenance culture and form _or_ system of government outdated nature of the technology used in designing the plants ( they where actually designed i n the late 70s) employment of the wrong personnel to handle operation process. My action plan is for NNPC to invest more in reinstallation of refineries across the country, cause they have the resources and ability to do so and this will lead to them to invest a broad amount of funds into the development of the Nigerian economy by assisting existing or abandoned government projects a new department will be created in the organisation to support environmental issues that will help protect the earth.We will use our strong brand and credible repetition to create opportunities in the Nigerian market to carry out our already laid out objectives, these strengths will allow us profit from our opportunities. marketing mix (marketing strategy)In all the elements used in marketing strategy, the marketing mix which is also known as the strategic tools or controllable variables play a major role. This is because it involves price, place, promotion and product. These are the major elements a company needs to improve the demand of its goods and to target its customers (Philip Kotler, 2008).ProductThe product being introduced in the marketing is a pr flip to reinstall its refining plant and improves its technology with modern technology and sophisticated equipment with better and streamlined maintenance culture, by doing this will be help NNPC to reduce cost of exportation of crude, the introduction of new products lost from the refining of crude products abroad, like gasoline, diesel fuel, asphalt base, heating oil, kerosene, and liquefied petroleum gas, being LNG is one of the fastest growing alternative of fuel which NNPC can hold a strong ground by investing more on it and by doing so NNPC would be reaching out to the public and main consumers and helping the environment this will make it well recognize internationally.PricesThis is the sum of money that is required for the purchase of products or services or the equivalent in value which customers are willing to offer for a given product or service. A price tag cannot be fixed because as at the time carrying out this research there was know much breeding released by NNPC on its current tag on LNG product, the price of reinstallation of its new technology and new refining will cost millions of dollars which the Nigeria NNPC and the government can fund if they agree to work together and ignore selfish interest and they would make the money back in just a year of running a standard refinery and would increase its revenue by 50% in 3 years. And this will reduce the prices of petroleum products and other productsPlacementThe placement or location of refinery is already settled as NNPC has about 2 refinery abandoned and not functioning which all they need to do is reinstallation and improved technologies in other to make its supply chemical chain more effective and faster which they have a marketing system in place to facilitate distribution of products if refined from the country, i prize the re might be a new installation of refinery in the east in other not to cause tribal conflicts.PromotionsThis a very important aspect of the marketing P this is because it helps in promoting the proposal and new product introduction and the way it would improve the economy and the environment as a whole so it can derive into effect with is new product and the public would by the ideal and know its purpose this can be done by using various means of communication and enlighten them on changes before the proposal/product would come into effect, after then which the product would sell it self as NNPC is a branding on its own all it needs to do is sell it to the government and the public by all the forms of media available in Nigeria, intelligence information papers, radio, internet and mobile phones. An aggressive campaign will be lunched instanter targeting all consumers at all levels and the government especially , this will be very essential to the marketing plan because this type of product is a reintroduction of its kind in Nigeria. It is important that the lunch is perfect because the first cognition of this product will determine its success in the Nigerian energy market.Implementation of action planTo implement the action plan and swot analysis and marketing Ps NNPC would have to introduce the following which are continues training, quality function development, transparency supervision, negotiators, management system that works. preparationTraining is essential because this is a reintroduction of a product/proposal which will need specialist in that field in other for it not to go wrong, and training process should be un going at least each 6 months in other for staffs to be well educated and determine its need, and schools should be giving training in other for them to carry more research on transformation to a low carbon economy by introduction of refining crude product in Nigeria and how it will affect the economy growth and job opportunity.Incent iveThis is possible in this kind of situation in other to market this proposal it will need a bit of incentive which is assuring the public that it will employ more Nigerians than bringing in experts from abroad which will mean most of them will be sent abroad for training, secondly offer the government a target of increase revenue in 3years after start of operation and promise marketers and distributors price cut and more investment on alternative fuel (LNG) and there would be more market of other products to be introduced and follow immediately refining starts.Management information systemsManaging the progress of the product will be essential this will allow us to manage the product efficiently so that areas which are abstracted will be improved on. Managing a new product is as important as developing the product itselfContingenciesContingencies plan is always a key part of a marketing plan this is because of uncertainty this because the oil industry is not stable as there are l ot of players and top people in the government running other oil companies and would not benefit more if NNPC starts refining crude products in Nigeria as most of them are owners of oil vessel and stuff just inclose it fall short of government target i think it would verify on the public and the Nigeria Labour Congress who will be a key player in the transformation and communication to the public. discover of proceduresControl of this procedures and introduction of this new process is essential in other for NNPC to be able to manage and monitor this transformation and evaluates its performance based on sales of product and impact it has on the economic growth, it will need to monitor its other subsidiaries and ensure it goes through proper review and new management process so it can be transparent in its dealings in other to be able to get feedback from marketers and distributors and consumers especially who are the main priority. The information received from these processes will allow us to make any necessary corrections and alterations to ensure that the product is being supplied to the right segment of the market with the most demands.ConclusionWhy going through my research on NNPC and writing a marketing plan i realise that NNPC is a bit corrupt this is because the government has more say in its appointment of top management officials it will be a bit hard for the introduction of new refinery as most of them would be protecting their selfish interest so would want to use every means possible in blocking the process but with the support of the public and top Nigerian officials who are interested in transparency and intend for democracy to take effect it will certainly buy the heart of them and the public and the international community who has been worried why Nigeria could not have its own refinery rather than taking crude abroad before bring back to the country. If NNPC follow this marketing plan it would not just help its name but help the economy in bouncing back from recession and help employments and the countries reputation in the oil companies abroad.RecommendationI would recommend NNPC undergo a new management reform in other to be effective, it should privatise most of its subsidiaries so the government does not have much say in policy making and appointment of management team without political motivations.