An innovative approach to selecting a supplier for a solar and battery installation has propelled oil well operator Santos to victory in the CIPS Australasia Supply Management Awards 2019.
The winners were announced at the Park Hyatt Melbourne during the CIPS Australasia Conference.
Santos had decided to replace the diesel generators powering pumps at its 208 oil wells in the remote Cooper Basin in outback South Australia and South West Queensland with solar cells and batteries.
The generators consume 8.1m litres of diesel that create emissions, making a solar approach a potentially economical and eco-friendly option.
However, Santos knew it needed to compensate for its lack of experience in sourcing within the solar market.
A design competition initially attracted 16 responses, which were eventually narrowed down to five suppliers running a single proof-of-concept trial well.
Out of these, four suppliers took part in further trials to minimise Santos’ risk exposure, improve the original concept and offer more competitive prices.
Eight months after trialling two wells the project has saved $32,900, and cut diesel fuel consumption from 26,000 litres to zero.
Predicted savings are $10m when all wells are operational, and Santos has announced the project is to be rolled out to 56 wells.
The initiative, which also made Santos a winner in the Collaborative Teamwork category, has also attracted significant favourable media coverage and created strong collaboration between Santos’ Procurement and Energy Solutions teams.
The judges said of Santos’ entry: “An impressive Australian first that is repeatable across other locations and markets. The design competition is good and the business benefit delivered by the team took in a wide range of success metrics.
“There was clear trust and commitment to each other and the project. We’re particularly impressed by the speed with which the team was able to accomplish this considering the industry and constraints of the remoteness of the site.”
The full winners:
Santos. Project: Solar and Battery Installation to Increase Sustainability of Oil Beam Pumps in the Cooper Basin
BHP Minerals Australia. Project: BHP Local Buying Program
Westpac New Zealand. Project: Tomorrow’s Skills Today - Developing Procurement Resilience
CBH Group. Project: Spend Smart
Supplier Relationship Management
Sydney Water Corporation. Project: Supplier Relationship Management for Success
Property NSW. Project: Whole of Government Facilities Management Services
BHP. Project: Supply Innovation: The Open Innovation Process
Westpac New Zealand. Project: Bringing Supplier Risk Management to Life
Diversity and Inclusion
Department of Foreign Affairs and Trade. Project: Diversity and Inclusion in Development Cooperation
New South Wales Procurement, NSW Treasury. Project: Transformational AI Spend Analytics across NSW Government
Procurement Team of the Year – Large Teams
Air New Zealand
Ashleigh Turner, Hastings Deering Australia
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