More opportunities exist for indigenous firms in deepwater activities – Oilserv Chairman

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Sir (Dr) Emeka Okwuosa

Group Chief Executive Officer Oilserv Limited Sir (Dr) Emeka Okwuosa during an interactive session with Editors on the sideline of technical session of the Petroleum Technology Association of Nigeria (PETAN) sponsored by his company speaks on OB 3 gas pipeline project, importance of the Offshore Technology Conference among others. Publisher Nigerian NewsDirect Dr SAMUEL IBIYEMI was there. Excerpts.

Can you tell us what the oil and gas industry looks like today for service providers?

Oil and Gas industry is a very active industry, not just over world or all of the world, but in Nigeria. I am sure the theme in this year’s Offshore Technology Conference (OTC) panels discussion which hinged on “Deepwater services and opportunities: The journey so far” tells a lot. Clearly, oil industry continues to be relevant, to drive the economy of Nigeria but not quite as much as we will like it to in terms of the integration into the economy of Nigeria as far as GDP contribution is concerned. But, there are many structured manners that can be put in place to be able to achieve that. Some of these were also discussed today. What is important is that for services as at today, I can confidently tell you that available opportunities in services, whether in deep offshore or land or swamp, less than 20 per cent of that is touched in terms of value. So, the opportunities are huge.

OB3 is a game changer, how soon will the pipeline project be completed?

Let us put OB3 in proper perspective. No pipeline has been built in Nigeria of that size and capacity. You may recollect if you have been in the industry long enough or old enough to understand  where we are coming from in the 70’s, 80’s, the 90’s, we had the like of Wilbros, Mac Demond and   that, there were no Nigerian players. Even at that, you look at all our pipeline infrastructure today, nowhere has 48-inch pipeline been built. Let us also put it into perspective, not about the pipelines, we have the GTP (the Gas Treatment Plant) at Obem, which is part of our scope. This is a GTP that is handling 2 billion standard cubic feet of gas per day. It never existed anywhere in Africa. You just have to go there and see the massive nature of it. So, when we are talking about building OB3, it is not building a pipeline. Our own section, there are two LOTs there, we are building LOT B that will take the gas all the way to Oben Plant plus the Oben plant itselt. Do not forget that there are two lots there. Our pipeline, we finished it three years ago, but the treatment plant took a longer time because the location was changed to what you call Oben North to the GTP location. And it took us two years to go through the re-engineering, getting approvals and all that. But the story is clear, the pipeline and the GTP facilities are going through pre-commissioning now. Our own section of it. If you are privy to the NNPC visit last month, which was on news stream, you saw the picture, you saw the Chief Operating Officer (COO) of Gas and Power, Nigerian National Petroleum Corporation. So, by September, our own lot would have been done. I can only talk for Oilserv and that is it.

Will the commissioning of your Lot on OBEN allow gas to flow through the system?

To some extent no!  It depends on the way the owner of the facility wants to use it. One thing you have to know, the technicality is that, we have a pipeline going to GTP Oben, but we have a 36-inch built from Obem, the Gas Treatment Plant, to Escravos Lagos Pipeline (ELPS); which is Obem nod. That is a bi-directional pipeline which means you can take gas from GTP in Obem to ELPS or from ELPS to Obem. So, the answer is yes and No! In the sense that we can take gas from ELPS into Obem to Ajaokuta when we commission it. But the other section cannot be completed except Lot A finishes to be able to evacuate gas all the way to Obiafor Obrikpa into Obem.

How are the indigenes taking advantage of deepwater activities?

We are already operating in that terrain. When you say operating in terrain, you look at it from two points of view. Are you looking at the E&P ownership which is operating or looking at service? I will talk from the service point of view, Nigerians have been participating from the surface point of view. I mean the presentation that was made and the discussion all the way from Bonga, Akpo, Usan and all those fields development have had Nigerians’ input. But there are two key issues with participation in deepwater arena. It is about technology and capital. Both will take time normally to scale up. Nigerians are participating but as I said, we are only skating the surface, there is still more opportunities for participation. Now, how do you increase that, if you listened to the comment made by the Managing Director of Shell Nigerian Exploration and Production Company (SNEPCO), Mr Bayo Ojulari that you basically need to assemble capacity and integrate the capacity by working together in order to have synergy and be able to deal with bigger scope. But we are in the integration of Floating Production, Storage and Offloading (FPSO) vessel which is the issue of Topside. Nigerians are in the pipelines and risers, in drilling and quite in a lot. But it is very competitive, capital intensive and we have to slowly build it up. What I am saying is, we have proven capacity but we need to do more because there is so much out there.

How will collaboration of indigenous companies add value to Nigeria’s oil and gas industry?

I do not think he meant that we have not added value, value is being added but not to the extent that we want it. The way to get it to higher level is collaboration, synergizing between the entities especially PETAN and non-PETAN members in order to be able to handle bigger scope and also to compete with international service providers.That is the direction.

Why is collaboration not taking place currently?

It is the Nigerian factor. Everybody wants to do things in his own way and it is  not the way to go. If you remember, if you go to houses where you have flats, like 10 to 20 flats, then you have up to 20 antennas whereas one antenna can work for everybody and they will all connect to it. So, it is about understanding that the way to create value requires working together not individuals. It is a mindset thing and we are going to get there.

What is your future plan to incorporate technology into your operation?

We are already incorporating a lot of technology in our operation. I will give you an example, many years ago, you could not find Nigerian companies that could do horizontal directional drilling, you would have had to go get international companies to come and do it. We have deployed that and have been able to cross rivers with 48-inch pipeline which will mean drilling and opening the line, the hole to 64 inches which is a major challenge because it collapses a lot as it as unconsolidated. But the point is that we are encouraging technology a lot as a company. In University of Nigeria, Nsukka, we have been sponsoring Nano-technology and it has got a lot of applications across boards. However, in the Oil industry, we can talk of drilling solutions and talk of materials but the fact remains that such technology will go from research into deployment. This now requires teaming up with the research entity and the industries. Also, in UNN, we have sponsored the science pack called “The Lion Science Park” which is the first of its kind in Nigeria. The UNN is the first university to set up  science Park in Nigeria It is done in collaboration with the idioms science pack in Sweden. Now, it is a big thing going on. If you go Nnsukka today, you will see it in action. What we are doing there is the incubation of technology from the students at various levels, helping them to develop it and link them up to industries that can invest and take it to work. Yes, you may not be able to confer the 20 opportunities but if it is just 20 per cent you are able to convert, you are making a major headway as it is going to end up like a silicon valley. So, things like that, Oilserv likes to encourage, not just for our own use but to be able to drive technology in Nigeria.

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