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NETCo moves to operate offshore Nigeria

National Engineering and Technical Company (NETCo) is Nigeria’s first national engineering company and is wholly owned by the state-run NNPC, with the sole aim of developing in-country oil and gas engineering capability. Yemie Adeoye of Sweetcrude cornered Mr. Kenneth Ejuoneatse, the Managing Director of the company on the sidelines of the Offshore West Africa conference in Ghana, and he noted that the company intends to partner with the Ghanaian government in bringing about state of the art engineering and oil exploratory facilities in the former Gold Coast. He also disclosed that Nigerian companies are not in Ghana to take over their oil industry but to partner with them and ensure that they benefit from our experience and as well learn from our mistakes. Excerpts: Most Nigerian engineers trained by NETCo are working in some new engineering companies, could this be because they’re paid better? Not really because they are paid better. You know some of them just went there and some are overseas. It is a pride to NETCo and Nigeria that we have trained a lot of Engineers in the years, that’s the result of the federal government’s local content. They are working for other companies in Nigeria as well, even the IOC’s. You use to have a partnership with HL what’s the situation now? They left us long time ago, over 30years now, we are working on our own, we have grown and we are building engineering knowledge. It is not meant for the type of country or race, but if you are given the opportunity. We were given an opportunity and we are utilizing it. so, basically, all the engineering studies, detail engineering, project management, we can do it in-house. We are moving further and we want to go further into procurement and into construction. That’s where the money is in the industry. What is the difference between what you are doing now and the procurement process? What we are doing now is design. When you design, you go into detailed design from that you do material check off, which enables you to buy, and then you have enough materials to buy. The next thing after that design, we go into procurement which is you go in to buying of Vessels, pipes, compressors and so on, there are people who are manufacturing those things. In Nigeria now we have only few companies involved in fabrication, that is, only Dorman Long and Nigerdock. No other company does this, some of them have to be imported from overseas, that is the area we want to go into now. After buying those materials, you have to do constructions as if you are building a house, that means you have to buy the material, and this is what is applicable in the petroleum industries but there are some group of companies who go through the whole hog, from engineering, procurement, and construction. But now we are going into procurement and construction but ours will be in a big way. We want to start with small jobs, small engineering jobs, as we gain experience, we go into bigger ones like Hi-tech. you know Hi-tech is a big construction company. So what are you doing to build the capacity of your staff? Are you also talking about partnering with other foreign companies? There are so many companies here in Nigeria we want to partner with. Some of them have approached us. We have an advantage because they know too that this is a government subsidiary that is commercially driven, so they know our worth, the IOC’s are full of credits for us. So we want to partner with a lot of companies both in procurement and construction, I don’t want to mention any of these companies in bidding for any construction job or any procurement job. That’s how you learn. You learn by partnering. Inexperienced people over a couple of years, becomes more efficient and are able to handle their own stuffs. But are you not deviating from the original concept? No! If you look at when NETCO was established, it was very clear that we will be involved in the whole gamut of EPC contracts, but you cannot put that at a go, it is impossible, you have to build it little by little. We are so good in engineering so we want to go into procurement after that, construction. We are involved in Bonga, we are involved in Agbami, these are big FPSO’s, LNG we are also involved in Egina and it is a big FPSO. They have just opened the pre-qual now for the EPC. So, we are discussing with other partners who were involved in that pre-qualification too for the list of procurement. I know that Uganda came, the Uganda petroleum ministry sent a delegation long time ago and it came to NETCO. What’s the outcome of that? Nigeria has a lot of experience. The Ghanaian Ambassador came and we have not followed up, we have to follow up. We need to even go and visit them in their country and sell ourselves to them, not only him but to his staff. Because those are the people who engineered this things. This is the reason we came here for this exhibition. We wanted to sell ourselves to the Ghanaian government. This afternoon we are having a meeting with the minister of energy and tomorrow we are going to see the MD of Ghana National Petroleum Company (GNPC), The Man knew all what happened to Nigeria. We are meeting them so that they can have a sort of association with their own engineering companies so that all the mistakes we had in Nigeria won’t happen here. Basically, left to the international oil companies, they are ready to build the engineering overseas but the local content of the federal government has helped. All the basic Engineering must be done in house and it can start here in Ghana immediately. There is no need awarding contracts to overseas companies to go and do the engineering works for them. if we have an association with them, the Ghanian government forming a kind of an engineering government just like NETCo. We can go ahead to assist them but the benefit will go to NETCo and the Ghanaian government. Following the much proposed reforms in the sector, what is NETCo doing in terms of capacity building for staff? We are the only subsidiary of NNPC; we are the only company that is commercially driven amongst all NNPC subsidiaries. We don’t get money from the NNPC. It is from the engineering works that we do that we pay our staff. They pay us and we use the money. We like every other organisation, we are autonomous and government doesn’t dictate to us. We bid and if we win the contract, we will get the job. As regards the reforms, it would help the NNPC, by then the PIB will be approved by the national assembly then NNPC will be a commercially driven company then NNPC will run like a commercial entity like ExxonMobil, or like Chevron. so basically, we are already in that line. They are only assisting us to do better. That is what I see. Government doesn’t dictate to us, we have our own finances and we bid for jobs we think that we can win and that’s how we go about our jobs. How much dividend have you paid to NNPC? When a company starts, it runs into a lot of expenditu res, we have not been able to declare any dividend yet because in Engineering, the money that comes in is very little, but we have broken even, we have always been able to meet our costs, and as we go into procurement and construction that is when the money starts to come in, that is where we’ll be able to declare profit and dividends. Of course NETCO is owned hundred percent by the government, the NNPC. we have broken even. the profit starts to come in when you are doing procurement for the IOC’s and constructions that is where the money is. if you are not doing engineering, That is why all the big companies go into the whole gamut the EPC contracts. If there is no money in engineering, you cannot break even. What are you doing in the area of building capacity? We are having very major partners and MOU with companies and we are bidding. You know the bidding process is long, and that is one of the highest benefits in the PIB. When you bid, some times it last for 6 months or even 9 months. Up till now, the one we did, they just did clarification few weeks ago. So it takes a long time. But we are having MoU’s with various companies, procurement companies, EPC companies. If the jobs come up, then we will work with them. Like I said, it is a learning place, just like graduate coming out from school, you cant just come out and say you want to go into design. We have to train you. You have to stay with us for a period of one year, we build you into knowing some of the precautions and how we do the job. if you are good, then we can start to pay you on the experience you have gain and that is what we want to do. We want to follow it carefully so that we don’t make a mistake because safety and health is very important in the environment. As I said before, we are ISO certified. so if you want to do any thing, we have to make sure that you don’t make any mistake because if you make mistakes, it will be a costly mistake and most of the IOC’s will run away from you. But if you are consistent, ensuring that there safety standards is met, of course, immediately they try it once, twice and they see you are good, then they will give you more jobs, that’s why we are bringing in more jobs from the engineering field. I am aware that the Brass LNG is about issuing ICT for the EPC, would you also like to show much interest in this? Of course, it is part of the local content policy of the federal government that all engineering be it basic or detailed engineering must be done in house. Every body is coming to join us, to work with us. the IOC’s are impressed and most of our colleagues too, as you know in NETCo we have the NNPC staff and NETCO staff, both of us have worked with our colleagues in the Brass NLNG. They know us and our capabilities and we are sure we will take part in our feat and detail engineering, part of it with the other companies. Your coming here to Ghana is seemingly exploratory, how do you intend to follow up? The feeling that there are too many Nigerians here so you have to find a way of allowing the government knows we are not here to take over these things. We want collaboration with them that is why we are coming here to talk to the government officials. Next, we are going to sit down and work out with private individuals here in Ghana, so that we can form an association, and MoU where of course, they will be in the fore front, we are not going to do the job in Nigeria, the job will be done here and an appreciable number of their people will be there, and our people will be here too. We want to be very careful because so many of them are thinking that Nigerians are coming down here to take over there banking sectors and others. We really have to be very careful. we have to make them understand that we are not here to take over there works, we have to assess them and their capabilities in their engineering field and move on to the EPC and of course we will be with them and get some benefits too. How many man-hours did you record last year? 100,000 man-hours. Is it upward or downwards? It’s just going down Can you tell us a little about your set programs in developing NETCo so as to improve on what you did last year? Like I said before, the Egina project is a big project, after the basic engineering we’re going to detailed engineering. We are already talking with the IOC on that. The Mobil job is another big project. Their platforms are quite old, so we’re carrying out integrity checks on all those platforms. SNEPCo also wants to go into the Bonga Southwest; they are only waiting for the PIB. You will recall what the MD of SNEPCo said yesterday, “If the PIB is approved, then they can move ahead with the project”. As for Gbaran Ubie, Shell too has some projects that we have won some contracts on too. there are lots of work coming on, especially when there is peace in the Niger Delta All of us know that SPDC wells are onshore, very soon they will start to produce. In short, some of our staff are working with shell, we supply them manpower, in Port-Harcourt and in Lagos. What are you doing to brush up the knowledge of these graduates, as there have been complaints of a dearth of good and quality engineers? All over the world, when you go to the university to get an academic qualification, when you come into the industries, you must be trained in the realities of what is happening in the industry, even the culture of that industry.


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