The indigenous oil and gas service providers continue to encounter many challenges, including drop in contracts, partly because the current lull in the oil market has constrained the major oil and gas operators from awarding new contracts to them. In this interview with UDEME AKPAN at the sideline of the just-concluded West African International Petroleum Conference, WAIPEC in Lagos, the chairman of Dorman Long Engineering Limited, Mr. Timi Austen-Peters spoke on a wide range of issues, including possible solutions.
What motivated the founding fathers of Dorman Long to set up this company?
It was British Steel that established Dorman Long Engineering Limited as part of its colonial expansion in Nigeria. This explains why you can find Dorman Long in Australia, Kenya, Ghana and so many other countries. In Nigeria, we are waxing stronger. The company was set up primarily to be a bridge builder. For instance, the company built the Niger Bridge. However, because it has the capacity, the company looked for other things to do after completing the bridge. We have been involved in many structural steel fabrication projects in Nigeria. We built Niger Dock. We also built many warehouses in Port Harcourt and Lagos. With the beginning of commercial oil production in 1956 and growth in the 1960s – 1980s, it became 100 per cent a Nigerian company, apparently because of the indigenisation policy of the government.
What kind of products and services do you offer?
We are mainly an Engineering, Procurement and Construction, EPC Company, doing engineering, procurement and construction of steel products. We do steel-related works in bridges, sophisticated signboards, railways and pipelines. We are doing one giant church (I don’t want to mention the name), the roof alone is almost $4 million steel. We can build pressure vessels, which is almost like a bomb, because you can put gas inside. This is a delicate project because if you do not do it to the right specifications and thickness, it can cause problem.
We also have the capacity and certification to build galvanizing plant. We can do 90,000 metric tons a year. But we have never done up to 10per cent of our capacity because as a nation, Nigeria did not get involved in the business of building major projects, including fertiliser plants and the Liquefied Natural Gas, LNG again. Now that LNG and other projects are coming, we pray that the investment we made many years ago would make meaning.
Who are the major clients in Nigeria?
Apparently, because we started early, we have many clients in Nigeria, including Shell, Chevron, ExxonMobil and NLNG. We are currently looking at other areas, especially transport and signage. We have partnered with JC Nicole, the biggest outdoor signage company in the world and they are working exclusively with us.
What stands you out in the marketplace?
A few things have enabled us to stand out in the competitive market place, including our history, expertise, quality, safety, commitment and pricing. During the oil downturn, we were able to get 30-40 per cent cost savings for some of our customers, a development they appreciated. Now that the good times seem to be coming back, they are also sticking with us.
What is your operational capacity at this time?
Our capacity has increased over the years. Consequently, we have three yards in Lagos, which are located at Idi-Oro, Agege and Victoria Island. Plans are underway to ensure that we bring all operations into one big location, possibly adjacent to one of the deep-seaports that are currently being developed in future.
What are your plans and projections in the medium and long-term?
We are determined to work towards consolidation in many areas, especially acquiring new equipment capable of delivering better services to our clients.
What level of priority do you attach to training and capacity- building?
Training and capacity-building are key. For instance, last year, we trained over 200 people in Engineering, Safety and Project management. We do a lot of training both for ourselves and for other people.
Apart from sponsoring Golf at the Offshore Technology Conference, OTC, what other forms of CSR programme do you offer?
We support many things, Golf just happens to be the one you have heard of. We do a lot of training, we do CSR in terms of safety and in Lagos State, we have contributed a lot towards some of those programs. We do a lot of enlightenment. Every project that we do has a major CSR component.
Does it mean that there are no problems in the sector?
There are many problems. As I told you, there was a downturn, we had to find cost savings of 30 – 40 per cent, and that means profits are down so we are all squeezing the belt tighter. With a 70-year-old company, equipment is old, we need to replace them, very expensive equipment. Even for the people, the employment policies of 10 – 20 years ago, where may be you come with just OND, you can’t do that today with the way people are pressing computer now, you need to get people who are better qualified, young people, well trained who have the right approach to work.
Are you a beneficiary of the Local Content Fund?
We are not yet a beneficiary of the Local Content Fund but we are a beneficiary of the Local Content policy because it would have been impossible to operate without the policies. It should be noted that foreign companies offered all of these products and services we are offering in the past. However, because of the Local Content and other policies, our company and others are getting involved.
What is your assessment of Engineer Simbi Wabote-led NCDMB?
It has been fantastic. Engineer Simbi Wabote has been involved in local content for a long time. We are not surprised that he is doing well. He knows it from the policy angle, he knows it from the International Oil Companies, IOCs angle, and he knows it from other angles. He is doing a great job, thus opening new opportunities for indigenous companies.
What advice do you have for the government?
The government has done well and needs to do more. Most people just want to work. Nobody wants a free lunch. If you give people the opportunity to work, give them a conducive environment to operate.