‘Government must entrench policies that empower Nigerian companies’

Timi Austen-Peters is the chairman of Dorman Long Engineering Limited, a company that specialises in fabrication, steel and asset management. In this interview with ODINAKA ANUDU, the lawyer-turned- administrator talks about Dorman Long’s journey in Nigeria and why some of the company’s galvanising yards are not operating at full capacity.
Dorman Long has been around for over 60 years. Tell us about your journey in Nigeria so far.
The story of Dorman Long is the same as the story of Nigeria. It has been in existence just before Nigeria existed as a country. We have been part and parcel of the development of Nigeria, starting with our fabrication of the bridge which is in Onitsha and Asaba- the first Niger Bridge. We have been involved in almost all of the warehouses constructed in G.R.A, Ikeja, when a decision was taken to turn Ikeja into an industrial hub. Same thing in Port Harcourt. As the company and Nigeria itself got more confidence, we were invited into the oil and gas space and then we started producing more complex and high value steel structures in that space. We have been an integral part of the story of Nigeria, as Nigeria has developed confidence in stature, in value and complexity.

What about your capital investments in Nigeria?
In terms of capital investments, we haven’t done a lot recently because we have three yards already. We have excess facilities. If you come to our galvanising yard, you will see that we have invested almost $6 million. It has never done 10 percent of its capacity, why? It was established in order to support the fertilizer plants, LNG plants and so on, but none of these have taken off. So you put this beautiful facility down, so after doing that, the company has not had a lot of appetite to make further investments. We employ about 500 people but we train hundreds of people every year..

Apart from Nigeria, do you have Dorman Long anywhere else in Africa?
Well, Dorman Long is almost a franchise established by the British Steel. So, if you go to Australia and so many places, you will find Dorman Long, but the truth is that most of those companies no longer exist. It is Dorman Long Nigeria that seems to be the one that is thriving. With Dorman Long Nigeria, we are presently in the process of establishing operations in Ghana and we are looking to do the same in Côte d’Ivoire and Senegal.

Your company is involved in procurement, fabrication and other services. Among all of them, which do you see as a growth area for your business?
The growth area that we see is especially that of fabrication. Nobody has done any project in the last two to three years. Not that we didn’t need the project; we needed them but we haven’t been able to do them as a country. There was no money, no certainty, no appetite and all those things were needed. Now that there is a bit of certainty, a bit of confidence, some little money coming in, there are decisions being taken and we have seen an appreciable surge in fabrication, orders and other activities.

How are you handling some policy challenges affecting your sector?
Well, it is government policies, unfortunately, that have brought about our galvanising yard operating at 10 percent capacity. Government no longer follows through on various decisions to do fertilizer, Brass LNG and so on. Number two, in terms of fabrication, especially of towers for telecommunications and power industry, this is one of the main areas we are suffering. When we want to build a tower in Nigeria, we are paying between five and twenty-five percent duty on some of the components because Nigeria does not produce all of these things. However, when somebody comes with a fully built tower from outside Nigeria, they get 100 percent waiver. That does not make sense and that is something we suffer from. We are at the committee for steel as the House of Representative has been doing public hearings. We have made submissions there; we have participated actively; we have written memos on this matter, so it is something that we are pushing aggressively with government. You know because most countries look for how to protect especially this steel industry, the fabrication of towers and other people who bring in towers have to pay premium as opposed to getting a waiver.

As the economy is recovering, what plans do you have for expansion?
Dorman Long is a steel engineering company; it is not an oil and gas company. So, we play not only in the oil and gas space but in power, telecommunications and heavy industry. As all of those areas begin to breathe, Dorman Long intends to participate actively in all of them and so we expect that those would be major growth areas. But even in the area where we are concentrated in now, there are FDIs of very significant capital projects. There is one that is likely to be announced in the next couple of weeks of which we are a major component. We are seeing a major surge, so the company will expand its operations and it is because of how the future is going to be that we are determined to rejig our capacity by having a new yard over the next couple of years.

Tell us about your skills development programme?
You know Dorman Long as a company was actually the first to train welders in Nigeria. So we have this long legacy of training youths and what we do is that we partner with some of our clients, the international oil companies (IOCs). Whereas in this particular case I am talking about Hyundai and Chevron and then we have Nigerian Content Development and Monitoring Board (NCDMB), the local content regulator, also as a stakeholder offering its support. So what we do is that we provide on-the-job training, so they learn to do it, they see it and they work with people who do this. By the time they finish, they are able to apply for jobs in confidence and many of them do go on and get jobs because they know they trained at Dorman Long where they did something tangible. We are also always on the lookout for talents. We actually recruited seven of the welders. So whenever we see that there are people that are hardworking, talented and committed to their work, for us it is a thing of joy to give them an opportunity for their first step in life, but also it benefits us because we are getting the good talented people to do our work.

What are your thoughts on IOCs giving major jobs to foreign companies?
The reason why they give them to foreign companies is because we do not have the capacity to do them. We can do some of the fabrication but we may not be able to handle the more intricate aspects. But the point of it is that if we have been given this work, then it becomes a cardinal rule and policy of government that subsea must be done in Nigeria. So what we need is the will, the determination, the government policy to ensure that such things are done in the country.

Nigeria has huge infrastructure challenges. Isn’t this opportunity for you, being a player in this space?
Now, we will like to be part of these massive developmental government projects. We haven’t had many of such opportunities so far because government has not embarked on such projects in the recent past.
But as things are, going forward, there are a number of projects in power, infrastructure, telecommunications, railway and the general investments in all sort of factories. These are things we will like to be part of but we will go through the tender process and hope to do so.

What is going on with Dorman Long’s asset management?
Asset management as business is essentially to ensure the integrity of any particular asset, whether it is in FPSO, a refinery, fertilizer plant or even just in any normal factory and because of our fabrication background, we are able to go in and see the things that need repairing, things that need maintaining and changing. Initially, asset management is something that was undertaken exclusively by expatriates. We were told that Nigerians could not do it but Dorman Long as a company has been responsible for the asset management for one of the biggest FPSOs in the country, responsible for 200 barrels a day, without hiccups. We have done turn-around management for the third time and we have been receiving commendations for doing that because we do it on time, on budget and we do it safely.

What’s your advice to the Nigerian government?
We need the Nigerian government to decide the various policies that empower the companies like mine in Nigeria. They should take a decision, follow through on that decision and make sure companies like mine can grow.