Operations Management: An Integrated Approach, 5th Edition

CASE: Boseman Oil and Petroleum (BOP)

Boseman Oil and Petroleum (BOP) is one of many oil companies operating offshore petroleum platforms in the Gulf of Mexico. The company identifies offshore sites for exploration drilling and constructs drilling platforms. Once exploration activities are successful, the platforms are converted to a production platform to extract crude oil and natural gas. BOP operates multiple platforms and an onshore facility that serves as the primary interface between the platforms. Boats with specialized crews provide logistics services between the platforms and the onshore facility. The boats deliver fuel, water, equipment, and other needed supplies multiple times a day to the platforms. Accurate and timely delivery of materials is absolutely necessary for successful platform operations.

BOP had traditionally focused on exploration and production activities, paying little attention to operating costs. However, operating costs had been increasing rapidly. A particularly significant cost was the operating of boats and crews needed to provide logistics services between platforms and the onshore facility. The boats are highly specialized, with built-in storage tanks and unique cargo space designs. The boat crews are specially trained, and operating the boats and crews is highly expensive. Although BOP is dependent on the boat deliveries, it does not use the boats at full capacity and they are often idle.

Jeff Kessinger, director of offshore operations for BOP, ...