Nineteenth International Conference on Knowledge, Culture, and Change in Organizations

Abstract

One of the key strategic directions in Kuwait Oil Company (KOC) 2040 vision is the optimization of the portfolio to capitalize on opportunities and rationalize non-core and unprofitable assets. In this context as conventional low risk oil assets are becoming more mature, compensating for the associated oil production requires building a new efficient portfolio with new higher risk opportunities for filling this future gap. A robust corporate portfolio management framework is necessary for dealing with a combination of existing assets undergoing operations and new opportunities that shall mature to become projects or programs related to tertiary recovery (EOR), production optimization (IOR) and development of non-conventional assets, all of which have higher uncertainties, risks and total cost per barrel. KOC 2040 vision identified four strategic dimensions that focus on delivering an efficient corporate portfolio: processes, operating model, organization structure and capabilities. The corporate portfolio management will have to deliver the maximum value prioritizing the opportunities, considering internal constraints on capabilities and resources, standardizing governance processes and then maturation of selected opportunities with sufficient subsurface definition (Front End Loading), for business capital investment decisions. The portfolio management will be assisted by unified models in economics, risks, reserves, production and capital allocation. Implementing this master change management project in an NOC, will face resistance or hesitation because of a deeply rooted culture. This paper proposed a framework to implement corporate portfolio management in KOC that can accommodate the challenges and align the processes with incremental changes across the dimensions instead of disruptive changes.