December 2017 Special Report: Suppliers: A pivotal localisation enabler
International service providers have aligned their companies' growth strategies with the national agendas of regional states, and are investing in ICV for their own benefit
An encouraging trend that has emerged in the Middle East’s oil and gas industry is that localisation initiatives are being undertaken by not just the operators, but there is a growing batch of suppliers and service providers to the regional industry that is leaving no stone unturned to drive in-country value (ICV) efforts.
The propensity to develop technologies locally for the regional industry’s typical requirements, is a policy that Lorenzo Simonelli, the president, chairman and CEO of Baker Hughes, a GE Company (BHGE), feels is a core attribute of his company’s success in the MENA region. “We work in hand-in-hand with the requirements of the country we are present in, and that means having the right capabilities for what is required (locally). Also, you take the skillsets available in-country and accommodate that. So, in each case we work hand-in-hand to develop those capabilities,” Simonelli said.
“If you look at our Middle East presence, the localisation efforts we have made in the kingdom (Saudi Arabia) in terms of manufacturing and services, all of those are key elements of partnering. With regards to the kingdom, it’s not just about our oil and gas offering, it also applies to sectors like power; so leveraging the strength of the GE brand to provide benefits and in-country capabilities. Training and education is also something that we focus on,” he said.
“We work with many of the NOCs. We have been present in the Middle East ever since natural resources were found; in fact in some of the countries we were part of drilling the first well if you go back in history. Over the 80 years, we’ve worked hand-in-hand with the companies here. We have 6,600 employees and have a number of facilities. We are local, and also for the production of many of our components like wellheads, compressors, etc.”
Apart from the key regional oil hubs of Saudi Arabia and the UAE, BHGE has a significant local presence in other regional states. In Algeria, for example, the company has a partnership with Sonatrach; in Iraq, a facility in Rumaila; and in Egypt, BHGE has expanded to cater to the developments around the giant Zohr offshore gas field.
Simonelli continued, “The other relationship we have with this region is in terms of technology – we have relationships with the different universities and the different centres here, especially the one in Dhahran Techno Valley (DTV). We are continuously developing technology required for the regional industry. I can’t think of one area that we are not present in.”
With regards to the aspect of training and skill development, which forms an essential cog in the wheel of localisation, supplier companies are implementing result-oriented programmes for the formation of a valuable local labour resources pool, on which they can rely upon to further the goals in their broader ICV agenda.
As part of its Beginners Integration Training (BIT) Program, Emerson Automation Solutions in Q3 this year, is recruiting 15 Saudi nationals who have recently graduated from universities and institutes in Saudi Arabia and the United States. The recruitment and training programme, which is consistent with Emerson’s global commitment to invest in local resourcing and communities where its customers are, is planned to be conducted annually with a minimum of 15 graduates who will be hired to full-time positions with the company each year.
This recruitment and training programme reflects Emerson’s continued commitment to invest and further economic development within the region. It is designed to support the In-Kingdom Total Value Add (IKTVA) programme by driving localisation and job creation in KSA through the development of local talent.
The newly recruited graduates will occupy technical (electronics, instrumentation, computer science, chemical and mechanical engineering) and non-technical positions (such as logistics, finance, marketing, administration, and document control). Emerson’s BIT Program will also aid in managing and staffing projects locally in the Kingdom, allowing faster project completions.
The training, allowing the participants to be exposed to the various operations involved with Systems and Solutions through several courses, is expected to be completed within less than a year. Performance of participants will be measured through progress reports, training examinations, and programme milestone reviews. The first group of new hires for BIT started in July.
“The standard set by this group of employees is very high and reaffirms our long-term vision for this programme,” Liam Hurley, general manager of Emerson Automation Solutions in Saudi Arabia, said. “I am very excited about Emerson’s future in Saudi Arabia having this team on-board and look forward now to seeing how the group grows and develops throughout the programme.”