Sapura Energy Berhad

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SAPURA ENERGY BERHAD

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Contents

Define your industry        3

Conduct a PESTEL analysis of your (chosen) industry        3

Political Factors        3

Economic factors        4

Social factors        5

Technological Factors        5

Legal factors        5

Environmental Factors        6

Impact-Uncertainty Matrix (figure 1)        7

Two impactful and uncertainties factors that affect the Oil industry        7

Four Scenarios        9

4 Scenarios Matrix (figure 2)        9

Four Scenarios        10

∙        Demand        10

∙        Carbon Free Cars        10

∙        Solar and wind power        10

∙        Decrease in global oil production        10

Porter Five Forces Model (figure 3)        11

Threat of new entrants        12

Threat of substitutes        12

Bargaining power of buyer        12

Bargaining power of Suppliers        12

Rivalry        12

Five forces model for each scenario (figure 4)        13

∙        Decrease in Demand for oil and gas        13

Threat of new entrants        13

Threat of substitutes        13

Bargaining power of buyer        14

Bargaining power of Suppliers        14

Rivalry        14

Five forces model for each scenario (figure 5)        15

∙        High demand for Carbon Free Cars        15

Threat of new entrants        15

Threat of substitutes        15

Bargaining power of buyer        15

Bargaining power of Suppliers        16

Rivalry        16

Five forces model for each scenario (figure 6)        16

∙        Solar and wind power        16

Threat of new entrants        17

Threat of substitutes        17

Bargaining power of buyer        17

Bargaining power of Suppliers        17

Rivalry        17

Five forces model for each scenario (figure 7)        18

∙        Decrease in global oil production        18

Threat of new entrants        18

Threat of substitutes        19

Bargaining power of buyer        19

Bargaining power of Suppliers        19

Rivalry        19

Recommendation/Conclusion        20

References        21

Define your industry

I have selected Sapura Energy Berhad; it is a leading integrated gas and oil services and solutions provider operating across the entire upstream value chain. With a highly skilled and technically capable multinational workforce, strategic world-class assets, and strong project management capabilities, the Group today has a global presence in over 20 countries. The company has reported net revenues of 1912 million dollars in the financial year 2017 with net income of 52 million dollars in 2017. The company is the largest oil and gas service provider in Malaysia and the world’s fifth-largest EPCIC (engineer, procure, construct, install, and commission) company by asset base.

Conduct a PESTEL analysis of your (chosen) industry

Political Factors

Political factors are represented by the influence of a political party or government on the particular industry or company on the regional level, national level, or international level.      This industry contributes about 30 percent in the GDP of the country.

For most of the countries, oil and gas industry is the strategic point in economic, social and political needs of the country. This industry has the influence on energy production, production of goods and chemical production.

In the oil industry, the most influential organization is OPEC that has more than 40% of the world oil production. It has great influence on the oil prices.

Whenever governments or countries increase their taxes or shifts in interest rate can also have an effect on the demand patterns of the company which will have a direct effect on Sapura. So, Sapura need to stay up-to-date with such political factors.

Malaysia is one of the politically stabled countries and it is a positive point for the companies operating in Malaysia, in a way that rules and regulation would not change and company’s focus would be on increasing profitability rather than on the political environment of the country.