In today’s market with soft oil and commodity prices affecting the short-term viability of new and existing projects, outsourcing can be attractive because as it allows you to quickly and easily change course to minimize cost, maximize cash flow and mitigate risk.
On many oil, gas and mining projects, one of the easiest areas to outsource is on-site emergency rescue services and in particular, highly specialized areas like high angle rope rescue, confined space entry rescue and firefighting. Why? The reason goes beyond simply economic and I will try to articulate some of the benefits both economic and other below.
Having an outsourced emergency services operation like high angle rope rescue allows you to shutter the service when construction stops or a turnaround is delayed. There is no risk. When things pick up, and the need arises again, the service can be added back into the mix.
Employing a full-time rescue team requires a myriad of costs ranging from salaries, benefits, training and so on. When there’s a softening of commodity prices, do you keep them on and keep paying or do you let them go? Both options can be expensive propositions. Keeping your in-house team means an ongoing run of salaries and associated costs, while letting them go means severance costs and the cost to re-hire when the cycle turns are high.
Reduced costs are a huge benefit of outsourcing in general. Specialized rescue services aren’t cheap. The ability to quickly turn “off” a service when it’s no longer required allows you to reduce cost and maximize cash flows.
Safety services such as high angle rope rescue and even onsite emergency services lend themselves nicely to an outsourced model because they are not core business functions. As an oil and gas company, you should use your finite resources on core business initiatives that will help drive IRR (internal rate of return).
There are a number of other reasons why outsourcing makes sense, such as reducing liability, accessing the best-trained people for the job and the list goes on, but in the context of this blog, the above mentioned points take precedence.
If you need high angle rope rescue or onsite emergency services for your oil, gas and mining construction, maintenance or turnaround projects, please contact Steve Gruber at firstname.lastname@example.org for more information.