Localisation of the Saudi Arabian Oil & Gas industry is a top priority for the Kingdom’s government, the ministries involved in the Oil & Gas and education sector, as well as many of the large Oil & Gas companies working in-country.
With companies such as Saudi Aramco, Schlumberger and Honeywell backing this localisation drive, as well as universities such as King Fahd University of Petroleum and Minerals, the drive to include more local Saudis is well on its way to being a success.
“Saudi Arabia ihs a young nation, and its workforce is growing fast. There is a need to create and generate millions of new jobs.
At the same time, the Kingdom has one of the world’s largest energy industrial complexes encompassing oil, gas, refining, petrochemicals, power generation and transmission, water desalination, and other sectors, each of which will undertake massive investment programmes over the next few decades.
Consequently, there is a tremendous opportunity to build a robust industry of local goods and services providers around this large and growing energy sector, which can effectively meet the needs of Saudi Aramco while also providing high quality employment opportunities to Saudis,” explains Ahmad Khowaiter, executive director of New Business Development at Saudi Aramco.
The natural patriotism of a local Saudi Arabian workforce, trained in the country will also ensure the country’s Oil & Gas interests are put first.
“Those who are born to a country are naturally much more passionate and committed towards its future, and as an integral industry to the Kingdom’s economic growth and future, localising oil and gas brings with it this passion.
It in turn helps to create a sustainable future for its people by increasing skills, expertise and opportunities. We must ensure we develop the right talent in the right place to meet the demands of our clients, not only in the Kingdom, but in the region and around the world,” states Mohammed Al Mousa, country manager, Saudi Arabia, Honeywell Process Solutions.
For any company operating in Saudi Arabia, localisation is both a challenge and an opportunity. There are some exceptional educational institutes located in Saudi and many have a strong, dedicated focus on the oil and gas sector, providing access to a growing pool of talented Saudi Arabian professionals.
Universities, such as King Fahd University of Petroleum and Minerals, is one such institution that is driving localisation within the country by providing a learning platform for local Saudi students.
“The more learning we have, the more production we will have in the country and it is good to develop skills amongst Saudi people,” says Dr Ahmed Abdulaziz Al-Dharrab, University Registrar, KFUPM.
According to Honeywell, the oil and gas industry in Saudi is one that comes with ongoing opportunities and expectations, and as the sector grows so will the need for highly-technical solutions.
“Saudi is at a point where many of these solutions could be borne locally, and that is an exciting prospect for our teams on the ground there. We must have the resources to react quickly to local needs and demand for service and support. In addition, longer term it means developing talent to take on the management of the local operations,” says Al Mousa.
According to Saudi Aramco, the company aspires to facilitate the development of an economic ecosystem that supports a vibrant and competitive energy sector in the Kingdom by helping to attract, establish and promote energy related domestic industries that are globally competitive and create employment opportunities for Saudis.
Honeywell’s Saudi Arabian localisation drive:
Honeywell has been established in Saudi Arabia since the 1970s and has a well-established rapport with key universities and institutes to hire and train young Saudi engineers.
We have consistently localised our business in Saudi, through the creation and local manufacture of automation systems, and the development of engineering, service and integration capabilities, together with the establishment of a local training centre.
Highly technical people, specifically engineers, tend to be much sought after in Saudi Arabia, especially with a number of downstream and refinery mega-projects expected to come online over the coming years.
With a presence in the Kingdom, spanning more than three decades, Honeywell has committed to being part of this development and recently opened a dedicated Research & Training Centre at Dhahran Techno Valley in Dammam. The centre offers a platform for engineering research and training excellence for Honeywell employees, industrial partners, and customers.
We support the oil and gas industry largely through the provision of our technology and expertise. Honeywell has a state of the art technology training centre locally, where new employees are trained, alongside summer and co-op students. In addition we often host training for our customers, to ensure they can benefit fully from Honeywell’s complete solutions.
Article continues on next page …
King Fahd University of Petroleum and Minerals Masters Programme
King Fahd University of Petroleum and Minerals started a Masters programme two years ago to give students, mainly hailing from Saudi Aramco, a Masters degree in oil and gas.
“We have quite a good number of students coming from Aramco, they will graduate this January. It is a two year programme, a joint programme with Saudi Aramco and an institution in France and KFUPM,” says Dr Ahmed Abdulaziz Al-Dharrab, University Registrar, KFUPM.
The programme contains modules featuring field work, actual work experience as well as research.
“The programme is designed for students that have already completed their Bachelor of Chemical Engineering or Petroleum and they join this programme in order to get a master’s degree and this will qualify them for the PhD programme in the future,” says Al-Dharrab.
KFUPM has its own PhD programmes in Chemical Engineering and Petroleum Engineering should students wish to continue after their Masters degree.
“This Masters degree is the first joint programme in the Kingdom and there are about 20 places on each course. We have just taken in the third batch of students,” said Al –Dharrab.
“By the end of this month the first batch will graduate. The students already have jobs with Aramco and are studying part-time.”
KFUPM is famous for chemical engineering and has a strong research institute, where the university does research in collaboration some of the key players in the Oil & Gas industry.
Saudi Aramco’s Localisation Drive
Saudi Aramco has a well-chronicled legacy of making a major contribution to the development of the Saudi Arabian economy. For over 50 years, the company has strived to promote the Saudi private sector and in particular to localise its supply chain.
From its original goal of fostering the development of a local business community upon which Saudi Aramco could depend, the company’s local development efforts have evolved from promoting the establishment of agents and suppliers of critically needed imported goods, to the current objective of developing a globally competitive local manufacturing and service industry sector.
These efforts include:
• Contributing to the success of a growing number of manufacturers of energy sector materials and equipment, such as pipe, oil-country tubular goods (OCTG), heat exchangers, vessels, electrical cables and equipment, structural steel, etc.
• Supporting the growth of local service capabilities essential to the energy sector in areas such as basic engineering, drilling, geophysics, pipeline construction and maintenance, civil work and plant construction, etc.
Despite these notable successes, the opportunity to make a significantly greater impact in building local capabilities remains large.
Accordingly, Saudi Aramco seeks to continuously leverage its significant spending to facilitate the development of a vibrant and globally competitive Saudi energy sector, while maintaining focus on its core business objectives.
These activities will complement the significant development initiatives already underway in the Kingdom and are aimed enabling the creation of direct and indirect jobs for Saudis by 2025.
As a result of these considerations, Saudi Aramco has fast-tracked a set of high-impact opportunities in the energy goods and services portfolio, with the goal of creating vibrant new energy related industries in the Kingdom.
These industries can all benefit from current and/ or future large demand for goods and services in the Kingdom’s energy sector and in potential export markets.
Specific implementation routes for each of these industries are currently being pursued, including continuous market testing with both local Saudi Arabian and international players.
The company is also collaborating with key stakeholders to build the enablers necessary for the development of the broad group of industries.
The industry enablers were chosen according to their current availability in the Kingdom and the urgency of the need for them.
They include effective procurement policies, skilled human resources, small and medium enterprises (SMEs) support, availability of energy sector market data, and an enhanced business environment.
To meet its own internal Human Resource requirements, Saudi Aramco has developed a structured, proven framework for delivering world class training services to its employees.
Over the years the programmes within this framework have produced and sustained high levels of Saudisation for the company while enabling it to operate at a very high level of productivity, safety and reliability.
To meet the long-term objective of creating a competitive Saudi energy goods and services sector, Saudi Aramco is developing a new Human Resources Development (HRD) strategy with its business partners, leveraging the Company’s proven HRD framework to help build the right capacity and quality of industrial and technical training.
This Business Partners HRD Strategy’s goal is to increase the level of Saudisation of Saudi Aramco’s business partners. Achieving this goal will require a more comprehensive and holistic approach, beyond simple compliance with mandated targets.
Article continues on next page …
Specific initiatives include:
Construction Job Promotion
Saudi Aramco has recently established a contractors’ consortium for the various projects in Jazan. This is a not-for-profit organisation formed by the eight Jazan project EPC contractors, in addition to Saudi Aramco and the Technical & Vocational Training Corporation (TVTC).
This organisation will focus on selecting, training and hiring Saudi nationals to meet the demands of the construction phase of the Jazan Refinery and Terminal project.
Training is taking place at two training centres designated by Technical & Vocational Training Corporation, with the targeted number of Saudi trainees to be 5,000 over the four years of the consortium’s complete existence.
It is hoped that success with the Jazan initiative will lead to institutionalising this process for all other future mega-projects.
In addition to the two training centres for Jazan, an assessment is currently in progress to determine demand for the inspection and high-end construction disciplines.
This study, being carried out in collaboration with the Technical & Vocational Training Corporation, will assess the need for the Technical & Vocational Training Corporation to create additional specialised training institutes.
Business Process Outsourcing Center (BPO)
BPO involves engaging a third party provider to perform routine, repetitive business activities for a company.
The business processes outsourced to third parties typically include ‘back office’ (eg, human resources activities, IT, finance, accounting, procurement, etc.), ‘front office’ (eg, customer service and call centres) and industry specific activities in such sectors as insurance, banking and marketing.
Companies that have adopted business process outsourcing have found that it enables them to efficiently standardise business processes, reduce costs and focus on critical core activities.
To capitalise on this opportunity, which could initially create over 3,000 high quality jobs for Saudi women as early as 2016, Saudi Aramco and GE jointly developed a strategy based on a ‘seeding’ approach with the participation of one of the top business process outsourcing players in the world, Tata Consultancy Services.
In this regard the parties involved have agreed to accelerate the development of two regional business process outsourcing centres, in the areas of Riyadh and Dammam, with Saudi Aramco and GE contributing services demand sufficient to support the creation of 100 full time jobs at each of these two centres.
The current focus is on launching the operations of the centres by mid-2014.
Source: SAUDI ARAMCO
