Sustainability in the oil and gas sector is no longer a corporate social responsibility checkbox—it’s a strategic imperative. With mounting pressure from regulators, investors, and communities, oil and gas companies are now rethinking procurement as a tool to drive environmental, social, and economic value. This article explores how sustainable procurement is shaping the future of oil and gas and how Naftaar is leading the way.

What is Sustainable Procurement?

Sustainable procurement is the process of sourcing goods and services in a way that minimizes environmental harm and maximizes social good while maintaining economic viability.

Core Principles:

• Life cycle thinking

• Supplier diversity and inclusion

• Transparency and ethical sourcing

• Circular economy alignment

Why It Matters in Oil & Gas

The oil and gas industry accounts for a significant portion of global greenhouse gas emissions and resource consumption. Traditional procurement models often prioritize cost and speed over sustainability.

Key Drivers for Change:

• Environmental regulations (e.g., methane emissions caps)

• Investor ESG requirements

• Stakeholder expectations

Key Strategies for Sustainable Procurement

1. Green Supplier Assessment: Evaluate suppliers based on their environmental impact, certifications, and sustainability track record.

2. Local Sourcing: Reduces transportation emissions and supports local economies.

3. Use of Recyclable and Renewable Materials: Preference for products with lower life-cycle emissions.

4. Supplier Training and Partnerships: Engage suppliers in capacity building for sustainability.

5. Digital Procurement Platforms: Tools that automate compliance, track sustainability KPIs, and foster supplier collaboration.

Case Study: Naftaar’s Green Procurement Framework

Naftaar has implemented a robust green procurement framework based on international standards like ISO 20400. It includes supplier scorecards, AI-driven emissions tracking, and contract clauses enforcing sustainability.

Results:

• 35% reduction in procurement-related emissions over two years

• 22% increase in local sourcing contracts

• Enhanced brand trust and investor appeal

Challenges and How to Overcome Them

• Cost Pressures: Use total cost of ownership (TCO) models to highlight long-term savings.

• Data Gaps: Implement cloud-based platforms for data centralization and analysis.

• Supplier Resistance: Introduce incentives and phased adoption programs.

The Road Ahead

As the energy transition accelerates, sustainable procurement will be a defining capability for oil and gas companies. It supports risk management, innovation, and reputation building.

Naftaar’s commitment to green procurement not only contributes to global climate goals but also positions the company as a forward-thinking leader in the Middle East energy ecosystem.