SNEPCO highlights six drivers for increased local capacity development

A comparative analysis of local capacity development in three countries, Malaysia, Brazil and South Korea shows that consistency of government policies, efficient supply base, investment in local capacity and achieving economics of scale are factors responsible for their success.

Other factors identified are standardisation of processes and collaboration among operators and academia.

This was contained in a presentation made by Bayo Ojulari, managing Director of Shell Nigeria Exploration and Production Company at the inaugural edition of West African International Petroleum Conference and Exhibition (WAIPEC).

“Without policy consistency, we cannot grow local capacity to create jobs, diversify the economy and increase participation of local suppliers to the industry,” Ojulari said.

In an uncertain environment, where investment dollars go to countries with lower business risks, operators at the event highlighted the need to cut costs by improving local capacity, use of advanced technologies and partnerships between local and foreign players.

“We can grow volume of work and achieve economies of scale collaborations with EPC contractors and government incentives for large projects,” Ojulari said.

According to SNEPCO boss, his visits to countries like Malaysia and Brazil indicated that the countries could grow capacity because they had a deliberate policy that achieved the support of all stakeholders who were also part of the process.

The synergy of academia and operators was highlighted in the linkages between the South Korean fabrication yards builders and universities in the company. Brazil also has a situation where actual students were hired on projects where experts offer practical courses on what they are learning.

It was a consensus at the panel that collaborations were now a matter of survival in an environment where crude oil prices have become susceptible to the vagaries of uncertain markets and national policies of oil producers.

Ojulari said the oil industry will be better served through harmonisation of technical standards, simplification of projects at design, designing projects to reduce costs and creating a safe environment for local and foreign investors.

ISAAC ANYAOGU