Surplus OCTG Sealed Bid Success Story
This transaction yielded maximum results by going global instead of local for an OCTG and equipment sealed bid.
The seller needed a different solution to urgently dispose of approximately 3,000 metric tons of OCTG that lacked certificates while dealing with COVID-19 travel restrictions. To meet this seller’s internal requirements—accelerated transaction, regulatory compliance, and high ROI—the Requis circularity team developed unique outreach and social media solutions to find the right buyer.
“Despite the various challenges in the country where the transaction took place, including COVID-19 restrictions and high load-out costs, the Requis team executed a highly successful marketing campaign that attracted our global buyers to bid competitively,” stated Mahen Subramaniam, Sales Manager, APIC.
Highlights:
- Exceeded $600 a ton without MTRs
- Single buyer for OCTG lots
- Short time frame
- High ROI
The Challenge
Shell Deepwater had a high inventory of unused casing and tubing from an operator-to-operator purchase with Total. Unfortunately, due to transfer issues many certificates were unavailable for much of this inventory.
Shell Deepwater needed to eliminate rental costs and clear the storage yard holding this surplus inventory.
In addition, the surplus OCTG and equipment were located in Brunei, and shipping logistics complicated the sale due to the seller not providing loading assistance. The entire inventory weighed about 2,850 metric tons, so Requis had to find a local loadout source to assist.
Unfortunately, Brunei was under lockdown due to COVID-19 which prevented in-person equipment inspections.
The Solution
Requis used its customer-centric service to simplify the online bidding process. More importantly, the Requis team created a tailor-made marketing campaign for Shell Deepwater.
Requis’ hyper-focused customer service ensured its client an easy and reliable service. The project included an email campaign to 200+ buyers in the Asia Pacific, Middle East, and Americas regions over seven days with reminders and closers to keep buyers aware of deadlines. In addition, the Requis team used social media (LinkedIn) postings to widen the potential buyer pool.
The online auction produced great responses for Shell Deepwater. Buyers from six countries (Brunei, USA, UAE, Malaysia, Singapore, and Vietnam) responded to the online sealed bid. And through the Requis platform, over 99 bids were obtained with 12 buyers being qualified.
The entire inventory sold for over $1.6 million.
The Impact
After the initial strategy session, the Requis team developed the right online marketing plan. Requis’ approach resulted in a fast ROI considering regulatory compliance. In addition, repurposing excess inventory strengthens ESG efforts and reduces the carbon footprint for raw materials and energy sources.
“We are delighted with the dedicated and practical efforts of Requis in facilitating and delivering the successful sales of our stock materials, stated Abdullah Ibrahim, Technical Manager, Shell Exploration and Production, Brunei.
Through Requis’ online bidding platform, Shell Deepwater sold unused casing and tubing to one buyer. Some of the inventory was classified as scrap. Yet, the seller benefited with a purchase sale of 30% over scrap value.
The sale was completed in a short time frame, and the entire inventory sold for over $1.6 million.
Requis’ processes and procedures proved effective and valuable to the seller of the surplus equipment, with a successful conclusion to a single buyer for the entire inventory.
Shell Deepwater obtained a higher return through the online sale than using the local market to dispose of the OCTG and equipment as scrap.
In addition, a single buyer simplified shipping arrangements to one vessel for handling all OCTG lots.
Through its strategic partnerships, Requis gives enterprises better options to manage their surplus assets while providing them the power to access over 5,500 registered suppliers and a level of engagement that suits their needs.
For more about this case study and to discuss your specific needs, contact the Requis team to schedule a conversation.