Gulf drilling International Limited (GDI) is a Qatar based company that specializes in providing of the drilling rig and related services to gas and oil exploration and production firms that operate in the state of Qatar. It was started 2004 as a partnership business between Japan Drilling Company (40%) and Qatar Petroleum (60%) and with the successive exercise of share option provision through joint venture agreement. Qatar Petroleum increased its stocks to 69.99% with a subsequent transfer of its shareholding to the gulf international services. Gulf Drilling International has no associates or subsidiaries as well as not a party to a subsidiary joint venture arrangements. Currently, the corporation approved and issued shares in the capital is QR375.7 million. Its head office is found at the Main Airport Road in Doha, State of Qatar.
The company employs over 800 staff members split between offshore, onshore ad head office. GDI directly owns nine drilling rigs with four onshore, and five offshores used to drill gas and oil wells to enable their extraction. The drilling incorporates drilling boreholes of different depth, the sampling of subsurface formation reservoir fluids to determine the economic feasibility of production, and then the pipes and instruments are installed to pump reservoir fluids. GDI has maintained close ties with Qatar Petroleum as it has a direct ownership. It also offers services for contractual vessel management on behalf of its owner.
GDI has five offshore jack-up rigs of varying ages. Of them, Al-Wajba (previously named Gulf-3) was built in 1977 and underwent a complete refurbishment in 2006, while Al-Khor and Al-Zubarah are both brand new, state of the art rigs. Al-Doha (previously named Gulf-1 and Hakuryu-8), was built in 1981 and modified in 1987. Al-Rayyan (formerly called Gulf-2' and Ensco 55') was completed in 1982, was purchased by GDI in 2005 and underwent extensive shipyard work in 2010 for upgrades, refurbishments, and repairs. The older rigs have a maximum drilling depth of 6,000 meters, while the new rigs are rated for 9,000 meters.
The company operates four onshore rigs. GDI-3 (work over rig) was purchased new in 2008 to replace a previously leased unit. GDI-4 was built and placed into service in 2006. GDI-1 and GDI-2 were built in the early 1980s and acquired by GDI from their previous owners. All of these rigs are rated to a maximum drilling depth of between 3,000 meters and 4,500 meters.
Gulf drilling international limited has continued the expansion of its business scope, market share, and footprint. Lately, it delivered an offshore jack-up rig in Durkan with operation starting in November 2014. Additionally, in 2014 it signed contracts with shipyards in Qatar and Singapore to build a lift boat (Al-Safiya) in Qatar and Gulf drilling international limited a new jack-up offshore drilling rig (Halul) in Singapore. The company has also been getting into contracts with clients with the operation which started in 2016. Other new orders are with yards in the united states where it built two new land rigs which started their operations between 2015 and 1017. GDI slated to have eight onshore drillings rigs and maintain 100% market share. When investing in a new site, GDI improves the logistics, infrastructure and associated equipment to support the expansion of its services.
GDI has been in operation for over ten years while at the same time maintaining the best Safety record from the time it was incepted at a TRIR of 0.32, in 2014. In the same year, it recorded the highest revenue, and net profit was. In 2014, GDI had over 1700 employees with 136 being Qatari national accounting for 8% of its total workforce. It had a high willingness to grow and doubled its number of rigs from 9 to 18 in the span of just four years to meet its business expansion plan. The company is a member of the International Association of Drilling Contractors (IADC), the Drops forum (Dropped Objects Prevention Scheme) and the GCC National Drilling Contractors Exchange Forum.
Assessment and Analysis
According to the post, there is a substantial difference of the Gulf drilling international limited economic perspective and geographical perspective, especially that in Qatar, the economic condition is high regarding GDP. The country economy is high and makes the company enjoy the favorable business environment. In my opinion, Gulf drilling international services would receive an increased boost if it enters the African market where there are promising exploration and production.
The second perspective is on the Gulf drilling international limited exercising the international expansion regarding global strategy and export strategy. In the service industry, exportation of skills and techniques can be highly lucrative, especially in the 21st century where more countries are looking at the option of increasing their oil production. There is high perspective in oil and gas production as more countries become industrialized and the population increases. The global strategy looks at the world a single market with a sole source of supply as there is minimal variation as to what is offered in the market (Arora, 2014) from 2104, Gulf drilling international limited has shown interest in implementing global strategy to increase its revenues with the United States and Singapore being the first options. The company is concentrating on both the onshore and offshore drilling as well as managing other companies contractual vessel management. I think Gulf drilling international limited being a privately traded company can have a significant impact on its global outlook, especially that one of its shareholders is Gulf International Services (GIS) which is a public company. The individual investors, as well as selected institutions such as QP, makes it a very strong company in terms of capital and investment. It makes it the largest oil sector services company in Qatar with its shares listed on the Qatar Exchange. This phenomenon reduces the risk faced by the shareholders leading to personal loss as there is no possibility of losing all their investment through bankruptcy.
If Gulf Drilling International Limited operates on both the export and globalStrategies, their demand would increase especially among countries that are starting to explore and produce oil and gas. Through multinational strategies, customer demand for their services would be met as different countries have different expectations. The company may face various barrier and cost to enter international market specifically Africa where infrastructure is a big problem. Additionally, there is the difference in the economic level and the Cultural expectation. To build an excellent and working relationship, the company should focus on building the right environment for the government and the society. The variation on tax and legal issues would need to be identified and addressed also need to be addressed. In Africa, the business focus is mostly focused on human relationship management. For this reason, it is important for the senior operating managers to visit these places so as to set the needed strategies that would conform to the society involved.
Oil is one of the largest known pollutants in the world. For this reason, it is expected that Gulf Drilling International Limited would face high resistance from environmental organizations as it tries to enter new markets. For this reason, it would need to invest in strategies that would address the environment pollution concerns. The management of Gulf drilling international limited should have a clear vision on the distance expected after globalization of the company. It will bring new concerns on the dimension of culture, administration, geography, and economy. The cultural, administrative and economic distance between Qatar and Africa is high, and for this reason, it would need adoption of various strategies.
By application of international value networks, the company would choose a geographical location that would fit its business model determined by specific locational advantage. The location for every rig is associated with the infrastructure among other issues which may be different among countries (Ghemawat, 2001). For effective assessment and analysis, this is divided among various frameworks including economic, geographical, administrative and cultural categories. It is evident that the difference in behavior between countries and societies has a direct impact on how business is conducted (Ghemawat, 2001). Cultural difference has been identified to cause miscommunication or expectations of a given company product or service. The need to understand and value other cultures has created a sense of importance with many business sales and technical officials learning the language of communication of the host country so as to address quality issue better and solve problems in a better and efficient method.
The Administrative Distance is a concern of a common currency, free trade agreements, political relations, economic exchanges and colonizer links among countries. When these factors are considered along with countrys policies, institutions and levels of corruption, have a direct effect on foreign investment (Zurawicki, 2010). Gulf Drilling International Limited would find company. With high fluctuations of currency, the company would face unprecedented losses and business misconceptions.
Political instability is another problem facing most of the African countries especially the ones that have oil. Due to the substantial investment this sector of oil and gas drilling and exploration, there is the need for an established social relationship between the two governments so as to foster a better relationship. The Geographic Distance increases the physical distance. This raises the problem of addressing the customer concerns and complaints especially in the competitive business world where this is important. The poor response may lead to potential loss as royalty and reputation decreases. Emails become the norm of communication leading to poor interaction through telecommunication which seems to be a clearly and quicker method to solve an issue. However, in Africa, there is a positive aspect regarding cheap salaries and readily available labor visible. Although companies are focusing on cutting down on Humanresources, Qatar drilling international may instead focus on human capital which is readily available
Arora, M (2014) Global Strategic Management and its Importance,Zurawicki, L. &. (2010). Corruption And Foreign Direct Investment: What Have We Learned? International Business & Economics Research Journal, 291307.
Ghemawat, P. (2001). Distance Still Matters. Harvard Business Review
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