EPC have decided to sponsor the Operational Excellence category at this year’s Oil & Gas and RPME Awards. Why do you feel that Operational Excellence is so important across the breadth of the up and downstream oil and gas industry?
I think it’s important if you are present in a region that you try to understand what is going on there. We have noticed over the past three to four years here in the GCC that Operational Excellence, improving operations, should be a focus here. This is because you have some very large complexes here and small improvements here and there can improve profitability very quickly.
Not only that, there is also the safety aspect to consider. All the HSE questions that can be answered by implementing Operational Excellence strategies are important. I think that the more that we bring this out into the open and the more people become aware of it and exchange ideas across the region then I think that can only benefit the region.
Why is it important to celebrate accomplishment and achievement in the oil and gas industry at awards ceremonies such as this?
I think it brings recognition of what people are doing in certain areas. It doesn’t have to be high level people – it could be people who are making an impact at arrange of different levels. Especially with regard to Operational Excellence, it’s about celebrating achievement at all levels, not only at the very top but right the way down through an organisation. If you don’t get the buy in from people at all levels of your organisation, then your project will not succeed.
I think having awards at different levels – and again it doesn’t have to be the CEO or the Managing Director – then you are recognising those contributions from people right across the spectrum.
We carry out training for a host of different companies, including RosNeft in Russia. The biggest question that these organisations want answered is: how do you optimise the buy-in levels of your workforce? The project won’t work unless everyone agrees to try and improve everyday operations.
What benefits do JVs bring and why are they so prevalent here in the region?
I think they bring expertise, they bring knowledge of specific markets and it also brings the ability to train the local workforce. You are really shortcutting development. If you bring in a very good JV partner, they know the industry, they know how to get the best out of new technology, and they know how to optimise their operations. There are a lot of benefits. It works really well here.
In Russia, it is the same. We look at companies that did have a western joint venture partner and they were streets ahead in terms of safety, operational excellence and optimisation. Companies all around the world can benefit from the JV approach.
How do you think the Middle East compares to other regions in the world in terms of HSE in its upstream oil and gas projects?
I think because quite often you have local firms partnered with Western companies, the standards are quite good. But you can always improve that. Especially, if you are looking at offshore projects, I think there is a need to focus more on safety in that arena. Safety and environmental issues really. From what I’ve seen, this region is by no means the worst in terms of HSE, but there is always room for improvement.
Even though we’ve seen 50% of the value of oil wiped off in the last 12 months, we aren’t seeing any production cuts yet. Which areas of the world do you think are most at risk of production cuts and of having to sacrifice their market share?
I think each region will try to defend its position for different reasons. The political situation with Russia is one example of this. They will continue to produce and even to maximise production.
Here in the GCC, they don’t want to lose their share of the market. Similarly in the US, they do not want to relinquish their newfound energy independence. So, we are hearing that they are improving efficiency for shale oil production from the existing fields. That is going to have a big impact, improving efficiency and production requires a lot less new investment. Parties are going to have to get together if they want to have a reasonable level for crude oil prices.
What does the next 12 months have in store for EPC?
Because we are a relatively small company I think that we are flexible and we have a very good knowledge base from our consultants.
The thing we can contribute in this region and around the world is that we have worked with banks advising on financing and then supervising projects. It’s an important role and it’s also important for the banks to be assured that there is an independent control involved in some of these projects. So our focus is on things like that.
