SGS’s expanding portfolio in Nigeria

Nigeria

Andrew Hunter, managing director of SGS Nigeria, talks to The Energy Year about Nigeria’s place in the company’s global business portfolio, its footprint in the local oil and gas sector, and the increase in demand for crude inspections. SGS Nigeria is a testing, inspection and certification company.

What is the place of Nigeria in SGS’s global business portfolio?
When it comes to SGS’s presence in Africa, we are one of the largest oil and gas inspection affiliates. South Africa is much bigger, but we are still one of the largest. Ghana is also strong because of its activities in the mineral sector, but in terms of oil and gas revenue, we are one of the leading affiliates on the continent.
Our in-country portfolio is steered towards oil and gas, but we have plans to diversify out of it. We tried to invest in the mineral sector a few years ago, but we experienced several challenges. That’s not to say we won’t pick it back up. We are also moving more into the power, energy and renewables sectors.

What is SGS’s footprint in the local oil and gas sector?
In Nigeria we are a well-known company in the oil and gas sector. That’s the sector from which we generate the most revenue, which is followed closely by what we call the industrial sector and the environmental sector. Then we have our business assurance, as we call it, which is our training certification and audit business.
There are many services that we provide within the oil and gas sector, for example, metering inspection, weld inspection, product inspection and material testing. It’s such a big portfolio, but the main revenue generators currently coming from the oil and gas sector are lab services, offshore inspections, environmental services, training, certification and auditing. That is a snapshot of the main services that we offer in the country.

How do you assess the increase in demand for crude inspection following several refineries starting operations?
We’re testing many products every week in our facilities in Apapa and in Port Harcourt. We worked with the Dangote Refinery as it was developed. We were even talking at one point about placing a lab in the Dangote Refinery.
In Nigeria a lot of the petrol is still imported, so we understand the shift towards increased refining capabilities, and several refineries have come into operation. We believe that, due to this trend, there will be increased demand for crude inspections, and we are well prepared to capitalise on this momentum.

What is SGS’s strategy to continue growing its market share in the Nigerian energy sector?
We have a target for 2027 that is based on accelerating growth and building trust through developing and building on what we’ve already established overseas that we have not fully explored in Nigeria. We can tap into our group and bring in further expertise.
We are trying to develop more on the environmental side. We’re not just going to focus on oil and gas like in the old days of doing business. Sustainability will accelerate growth over the next two or three years. We see a global shift in perspective. Companies are now more focused on their sustainability targets and meeting the ESG assurance criteria.
Consequently, SGS has recently launched a new portfolio of services under the heading “Impact Now for Sustainability.” Impact Now is a new concept in the delivery of sustainability solutions. It consolidates our existing sustainability services under four pillars: climate, circularity, nature and ESG assurance. We have simplified the road to sustainability while creating a framework for developing the next generation of effective, forward-thinking solutions.
Then, we are putting great emphasis on developing new technologies. We have a dedicated IT group that works on digital innovation. We’re trying to find ways of being more efficient in the laboratories, which will save time and reduce costs while helping grow our business for the future.
Turnaround time is a big focus point in the company. Obviously the customer needs to be satisfied with how long it takes SGS to complete the task and issue the report and certificate.
These are all areas that we are trying to further improve. We’re already working towards diversifying our services portfolio. We’re well positioned, I would say, and we have the support to move in accordance with trends and emerging opportunities.

How does SGS address its own sustainability?
We have already started implementing several changes in-house. We took the step to bring renewable solar power into our office in Nigeria. We don’t just run on generators.
We also have a bigger solar power project on the table for our Apapa operations. It will reduce our reliance on generators, and we are able to generate power for the whole office in the Apapa plant. That should be live in Q1 2025.
There are other measures we can take along the way, but we want to see how successful Apapa runs before we move to Port Harcourt. Regardless, we must reduce our energy footprint, and our carbon footprint here is big because of our reliance on diesel. It’s a stress point we are addressing as we move forward.

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