Giving priority to local suppliers: A Tullow Ghana story

It might sound cliché but not at Tullow Ghana. The phrase, “local content” has come to mean the very heart of how it conducts its business. As main operator of Ghana’s two main oil fields – Jubilee and TEN – Tullow has a responsibility to harness the oil and gas resources available to the country and maximise the benefits for its people, communities, and shareholders.

In bringing this mandate to life, empowering, and developing local content in the sector is a crucial imperative. For close to two decades of oil discovery in Ghana, Tullow has lived good on the promise to ensure local companies, professionals, and other resource entities, get a fair share at the table of contracts, training, employment, leadership and other significant activities in the oil and gas sector.

Currently, close to 76% of its workforce are Ghanaians with a plan to reach more than 90% in the next five years. Its senior leadership team in Ghana, comprise a fair local representation, including the first Ghanaian female Deputy Managing Director.

Tullow also places critical focus on its local suppliers, ensuring that they have the best of opportunities to succeed in the industry. Key among these is the Closing the Gap workshop it organises for suppliers, in partnership with the Petroleum Commission. This year, the workshop had more than 200 suppliers attending. Another platform is the Tullow Business Academy for local companies and entrepreneurs in the industry. However, perhaps the flagship of these programmes is the Supplier Market Day event – a quarterly event to strengthen engagements and forge strong bonds with its many local suppliers and vendors.

Recently at the Fiesta Royale hotel, Tullow organised the first edition of the Supplier Market Day for 2024, bringing together more than 165 local suppliers to engage on topics including, the role of digitisation in supply chain management and the impact of technology transfer on local businesses. Competent resource persons from Tullow and the Petroleum Commission took the participants through series of presentations, including a session on how to get the best out of Tullow vendor platforms when submitting bids.

Delivering her remarks at the event, Tullow Ghana Deputy Managing Director, Cynthia Lumor, said:

“Local content is at the heart of our operations as a progressive business in West Africa. We believe that a country’s hydrocarbons must be a platform for socio-economic development and transformation, and we recognise that strong collaboration and partnership is necessary to advance the success of the industry in the decades to come. Programmes like this are, therefore, platforms for us to renew our commitment to you, show that we recognise your importance, and also advance our contribution to local content development in the sector.”

Tullow Chief Procurement Officer, Atul Sahay, speaking at the same event reflected on a long journey of partnership with local suppliers in Ghana, emphasising that the company’s supply chain trajectory has now reached an era of excellence, following two previous years of transformation and implementation. He said driving cost efficiency, and delivering real impact in the industry will be the driving force of its agenda this year.

A representative from the Petroleum Commission, delivered a presentation on the implications of technology transfer on local business, emphasising that technology transfer must focus on developing local partners in a sustainable way.

Subsequent discussions at the event drifted towards familiar territory of how suppliers can receive prompt and consistent support from the Petroleum Commission in their business operations. Questions around lifting complex regulatory requirements, navigating inflationary pressures in payments, and operating efficiently in the economy, also came up.

Altogether, the session afforded the key participants a chance to embrace new and emerging trends and to put themselves in unique positions to be successful in the oil and gas industry.

Last year alone, Tullow Ghana spent 96% of its expenditure on both local and joint-venture companies in Ghana. This translated into a total of $220 million in contract value for indigenous entities and $317 million on joint-venture companies. Additionally, in partnership with the Petroleum Commission, it delivered six training workshops, through the Business Academy, and also completed four Supplier Market Day events. Tullow has also introduced a new digital platform – Coupa – to assist local suppliers in tendering and managing bids for contracts in the sector.