Supply Chain Managment Oil Export

8/2/2019 Supply Chain Managment Oil Export

http://slidepdf.com/reader/full/supply-chain-managment-oil-export 1/10

Supply Chain Management in

RIL’s Oil Export to Bahamas

Presented by:

Rajesh Shukla

Aparna Pendse

Sangeeta Kotian



Points to be discussed

• Case Study in brief

• How RIL export strategy resembles SCM?

•

Benefits to RIL• Oil and Gas industry demand in 2011-12

• Prospect of SCM application in my company



Case:

• RIL’s increase in Gasoline exports to Bahamas.

• From 2009-10 gasoline shipped value $631 b reached to $2.2 b in 2010-11.

• Expected to rise by 50% to $3.2 b in 2011-12.

• North & South America located near Oil Storage tanks of Freeport in

Grand Bahamas island.• The company receives payments for the exports from customers in the US

or South America.

• Hired fuel tanks in Bahamas, attracted by the prospect of huge savings in

shipping costs by using large tankers to ship fuel to the strategically

located country.• Bahamas storage tanks are used for "bulk breaking" of large cargoes and

exporting smaller parcels to the North American and Latin American

markets.



How RIL export strategy resembles

SCM?

What is Supply Chain Management?, and how it

resembles in RIL’s case.



• SCM is configuration, coordination and continuous improvement of a

sequentially organized set of operations. The goal is to provide maximum

customer service at the lowest cost possible.

•

The links below represent the major supply-chain links in the oil and gasindustry.

Exploration → Production → Refining → Marketing → Consumer

• Case study shows Reliance is using traditional push strategy wherein,

production and distribution are being carried on forecasts.

• Below represents stage after refining. Where Oil is imported in Free TradeZone areas from reliance and stored and from thereon, supplied to

Gasoline stations as per demand.



FREEPORT, GRAND BAHAMAS ISLAND JAMNAGAR PORT, GUJARAT

7544 nautical miles



Benefits to RIL

• Easy accessibility to North & South American regions and Caribbeancountries due to Stock availability from Freeport storage tanks.

• Full truckload (FTL) rates are more economical on a cost per pallet basisthan less than truckload (LTL) shipments

• Exemption from other government licenses and permits for the operation.

•

No taxes or levies on business transactions carried on with personsoutside the Bahamas.

• No taxes to be paid on property, machinery and goods used within thefree trade zone.

• No direct taxes on or against earnings of any employee in the free tradezone or on the distribution of earning to persons living outside The

Bahamas.• No export taxes to be paid on exports.

• No customs duties to be paid on the importation of goods and articles(except consumable items) for use in the free trade zone.



Oil demand

• As per recent oil market report from international energy agency,

American regions will consume 30.1 mb/d (millions barrel per day) in

2012 which was 29.8 mb/d in 2011

•

After America only Asia pacific regions are near to it whereas othercontinents are below 15 mb/d, lowest is African countries 3 mb/d.

• Reliance have leased tanks to tap higher profitability regions by reducing

there shipping voyages and reducing oil wastages.



Prospect of SCM in my company



Bibliography

• Borcointernational.com

• International Energy Agency

•

Economic Times.com• Journal of Business & Economics research

• Bahamas Free Trade Zone Act

• Wikipedia.com

Supply Chain Managment Oil Export

Documents

Transcript of Supply Chain Managment Oil Export