IMPLICATIONS OF THE RELATIONSHIP
The significance of the relationship between IOCs and OSCs is often understated by industry observers. By contrast, the importance of the relationship between IOCs and national governments or NOCs is highly recognized. The constant need to access new reserves in order to grow their business makes IOCs’ connections with resource holders of crucial importance. On the face of it, the link between IOCs and OSCs seems less significant. However, it is equally vital. A wrong choice of OSC or work done poorly by an OSC will impact an IOC’s business and its relationship with governments. Furthermore, access to reserves requires technology provided by OSCs and efficient teamwork from both OSCs and IOCs.
The following section will analyse the importance of this relationship by looking at its financial and technological significance. It will also highlight how this relationship has shaped the oil services industry structure and how collaboration and rivalry are maintained in fine equilibrium. Finally, the section will provide us with the unfortunate example of the BP Macondo accident, where the problems in the relationship (among other factors) caused substantial negative consequences.