A diversified model in NigeriaJanuary 26, 2021
Michael Dumbi Amaeshike, managing director of West African Ventures (WAV), talks to The Energy Year about positive notes in the outlook on Nigeria’s oil and gas industry and the company’s strategy as a provider of EPCI and marine support services in the country. WAV offers engineering, procurement, fabrication, offshore installation, offshore accommodation and marine charter services.
What key developments and challenges is the Nigerian industry experiencing?
The year 2020 started on a good note for WAV but was soon truncated by the Covid-19 pandemic, which impacted negatively on global activities in the industry. With our huge dependence on oil revenue in Nigeria, the effect remained very severe throughout the year, and the expectation is that it will take a while for businesses to achieve pre-Covid-19 normalcy. The dual shock of the fall in oil price and the Covid-19 pandemic will obviously have an impact on the opportunities that our hydrocarbons industry holds, and how it ultimately recovers.
Despite the current economic situation, we believe the government should continue to focus on local content participation in the industry and drive increased production at lower cost. For instance, the Petroleum Industry Bill (PIB) is expected to avail local operators the much-needed flexibility and favourable terrain for participation in the sector.
In addition, the global focus on gas as an alternative source of energy is good news for Nigeria with our huge reserves, and it is expected that the federal government will encourage operators to take advantage of the opportunities that abound. This can be seen in the declaration of the year 2020 as “the year of gas” by the honourable minister of state for petroleum and despite the crisis witnessed this year, there have been slow but steady advances with new projects such as NLNG’s Train 7 project and the AKK pipeline project.
On another note, we have also witnessed continuous growth in the establishment of modular refineries, mainly around the Niger Delta region. The Nigerian Content Development and Monitoring Board (NCDMB) has since put expression to their resolve to assist operators who wish to invest in this area. Overall, the operating terrain remains quite challenging for the oil and gas industry, but it is envisaged that the goal of the government to provide a conducive environment will soon be achieved and there will be an increase in the level of activity.
What reception has the marginal fields bid round enjoyed and what spaces will it open up in the industry?
The marginal fields bid round was well subscribed to. The built-up expectations were high, so when the government went ahead with its plans, a lot of players were already prepared. The industry is looking forward to more committed companies obtaining oilfield licences and engaging in active prospecting and production. For West African Ventures, this potentially represents more business opportunities in the industry. With the increasing interest generated by oil and gas prospecting companies, we not only expect more business; we also expect to grow the scope of our services to operators.
What capacities does WAV have to service both shallow-water and deepwater operations?
We are fortunate to have had the opportunity to provide our services to the oil industry for decades, giving us vast experience in the oil servicing sector. As a company, we have enjoyed organic growth in that we have grown from servicing the shallow end to the deepwater end of the industry.
We have worked with companies such as Shell and Chevron who are more focused on shallow-end oil prospecting and production whilst also working with companies such as ExxonMobil and SNEPCO that have invested in deep offshore facilities. WAV is therefore able to support both shallow-water and deepwater ventures.
We have observed and supported the major operators venturing into the deeper ends of oil drilling, while marginal operators are gradually taking over the shallow end. Accordingly, we own large offshore construction barges, pipe-lay barges, supply vessels and anchor-handling vessels to support deepwater projects but we also have small vessels, crafts and various-sized barges to cater for shallow-water operators.
To what extent is WAV’s fleet a one-stop shop servicing the marine and offshore scene?
In the course of our operations spanning more than four decades, WAV has owned and operated a large and diversified fleet of marine support vessels that provide integrated support to our clients in the industry. Our current fleet comprises 47 offshore and over 50 inshore vessels ranging from AHT/AHTS vessels and construction/accommodation barges to cargo barges and more.
In addition, our offshore support base in the Onne FTZ in Rivers State comprising a well-equipped fabrication yard, offshore loadout jetty, machine shop and a full mechanical maintenance workshop including dry-docking, forms the reliable structure that provides WAV’s excellent delivery of integrated services to our clients.
Our focus is on upgrading our existing in-country assets and infrastructure to a level where both our vessels and those of our collaborators can take advantage of the resources in-house for periodic turnaround maintenance and for WAV to continue to provide a one-stop shop for the oil and gas services sector in West Africa.
What unique position does WAV hold in the country?
WAV provides EPCI and marine support services to the oil and gas sector – not just in Nigeria, but to the rest of Africa. We have installed subsea umbilicals, risers, pipelines, manifolds, upgrade modules, mooring systems, jackets, topsides and much more in green and brownfields alike.
Moreover, we have been the leading player in the Nigerian oil and gas market for over 25 years. Our reliability results from consistently providing quality services with a track record in safety. At least one vessel/barge from our diverse fleet of DP and moored vessels for accommodation, construction and marine support can be found in every field in Nigeria. This illustrates how critical we are in the development and sustenance of this sector.
Although the pandemic drove several businesses aground and also saw most of the IOCs recede on their development programmes, we continue to maintain our operations due to our diversified business model and solid reputation in the industry.
Our multipurpose base and shipyard in Warri with a 50,000-square-metre onshore supply and fabrication facility and our offshore support base in Onne have both remained operational with marine transport services, berthing support and loading/offloading, marine security escort, equipment storage, material preservation and fabrication of offshore and inshore equipment. WAV is indeed unique in its provision of a one-stop shop for fully integrated high-quality services to the oil and gas industry.
What projects did you manage to carry out during 2020 despite the crisis?
The year 2020 was challenging for most businesses globally and Nigeria was not an exception in any way. However, despite the difficult times, we managed to complete the engineering, transportation, installation and pre-commissioning of a number of subsea pipelines and umbilical installations in various oilfields in Nigeria. In addition, we also completed engineering for a single-buoy mooring (SBM) installation and performed structural revamps of multiple satellite platforms.
What key functions do your shipyards in Warri and Onne have?
Over the years we have grown organically from small boats and landing crafts supporting oil operations in the swamps and shallow waters to large offshore support vessels for offshore deepwater operations.
We manufacture our small passenger crafts in our shipyard/manufacturing factory in Warri. This aligns with our strong local content drive and our contributions to the acquisition and development of local skills in Nigeria. In Onne, our offshore support base and fabrication yard supports extensive fabrication of both inshore and offshore structures, relying on a combination of local skilled artisans as well as qualified expats. We also have a dockyard for maintenance of our marine assets as well as other third-party vessels.
How is local content anchoring WAV’s position and vice versa?
WAV is the typical example of a company driving local content forward for the benefit of the industry and society at large. With our many years of experience, even before the NCDMB was formed in 2010, we already had the highest number of Nigerian-trained operators in the marine industry. Today, we can proudly say that we have produced a large number of skilled and qualified mariners who support various aspects of the marine business in Nigeria today. These are men and women who have gone through the popular WAV training system.
It is for this reason that we pride ourselves on being “Your 100% Nigerian Partner.” We are a fully Nigerian-owned company with in-country-owned marine assets and solid infrastructural investment on the ground. Moreover, these achievements have been duly recognised by the award of the Nigerian Content Equipment Certificate (NCEC) categories A and C for yard and equipment usage and a Category AA certification for the marine vessel categorisation scheme on the NOGIC (Nigerian Oil & Gas Industry Content) portal.
It is our resolve at WAV to continue to partner with the NCDMB in the promotion and improvement of indigenous activities in the Nigerian oil and gas sector through our participation in various workshops, training sessions and exhibitions in the country.
What is WAV’s business plan for 2021 and beyond?
Taking a cue from our vision, we aim to remain the best provider of EPIC/marine services by our strict adherence to satisfying our clients beyond their expectations. To achieve and exceed this with due cognisance of the current tough business terrain, WAV will strive to adopt a prudent capital allocation policy to strengthen service delivery and ensure we remain focused on our usual excellent standards.
In addition, we shall embark on strategic improvement of our enviable fleet of marine assets through acquisitions and top-notch maintenance of existing assets. This will go a long way in closing the demand gap that exists in the industry.
Strengthening existing business relationships and partnering for greater cost efficiencies is a major area of focus for us in the coming year. This will be vigorously pursued by our crop of highly skilled professional teams made up of competent indigenous staff at all levels.