A purveyor of innovation in NigeriaApril 14, 2020
Ese Avanoma, CEO of BRADE Group, talks to The Energy Year about the Nigerian market’s adaptability to new technologies and the company’s plans for growth through its partnerships and subsidiaries. BRADE Group is an indigenous company that provides project management, drilling and completions services, as well as OCTG, marine and EPCI services to the oil and gas industry.
What new technologies are you planning to introduce into the Nigerian market?
We have a technology that is not new in the industry, but new to Nigeria – GRE [glass reinforced epoxy] lining of tubulars, a MaxTube Duoline technology. We have partnered with MaxTube Dubai in Nigeria and Ghana. Basically, the GRE technology introduces a non-reactive surface to hydrocarbon fluids flowing through the tubing, thus eliminating the challenges associated with corrosion.
Here in Nigeria, alloys such as 13% chrome are usually our default option to contain problems with corrosion for gas/water injection wells. But chrome pipes are quite expensive, manufacturing takes longer and the handling process (to maintain the material quality) can be painstaking, which is not a practice religiously adhered to from my experience and thus compromising the chrome tubing quality before it is even deployed in the well.
Add to this the limited shelf life of alloys compared to carbon steel pipes. There must be a less expensive, easier-to-handle and better option. That’s where our GRE-lined tubings excel, improving tubing life from six to 10 years for carbon steel pipes to up to 25 years when lined with GRE. The gains for using GRE-lined pipes pile up in comparison to current options such as 13% chrome tubings.
We are aware of two companies that are in need of chrome tubing but cannot source them because of the time required for production. Eni and Shell need over 30,000 metres of chrome pipes that are not readily available. Our partnership with MaxTube ensures we can line carbon steel pipes with GRE, and it does the work of chrome tubings with reduced cost and no losses from produced hydrocarbons. It is a cheaper substitute for chrome, and we have advanced plans to set up the GRE lining facility in Nigeria
What are the next steps on the MaxTube solution?
We received permission from the regulators to set up the facility in Nigeria after a trip with them to visit a standard facility in Dubai. If not for the recent liquidity challenges in the oil and gas industry, we would have commenced lining pipes in Nigeria. We are currently engaging companies such as Total and ENI that we believe have a need for this technology, and we are confident we should have some active work in the next few months.
It will take about six months to fully set up a GRE lining facility in Nigeria, and that is already too long to wait. So, what we offer clients now is a pipe plus lining option outside of Nigeria, possibly in Dubai, as we complete setup in Nigeria.
We are also in talks with LADOL to explore possibilities of setting up a facility in the Free Trade Zone to service clients there from a leased warehouse space. The facility will be co-owned by BRADE and MaxTube. Our goal is to ensure proper transfer of technology and local content capacity building while maintaining QAQC standards by keeping MaxTube’s interest and equity in the business.
How has the market reacted to your SEABOX technology?
We have already familiarised lots of companies with the benefits of the SEABOX-SWIT technology. We know two companies that need the technology, and we are confident that we will secure some deals for the SEABOX in a few years’ time, perhaps within months, especially with the resumption of exploration and development activities deep offshore.
Typically, the industry is very resistant to change, and that holds true of the oil industry in Nigeria. People are used to doing things the same way they have done them for years, and they are not keen to try things differently, even when current trends in the industry demand that. It’s like getting too comfortable in your old clothes. So, it has taken a while to mature the SEABOX technology in terms of sensitisation
A technology expert at Shell once described the SEABOX some years ago, as the technology of the future. It is now the technology of today, as the industry is focused on cost-reduction initiatives and new technology such as the SEABOX, which fits perfectly in that space.
We have set a target of securing a contract within 18 months starting from July of last year , and we are positive that is achievable. We are even hopeful for up to two contracts before this big cycle begins to show signs of ending some years from now.
What updates can you share with us about BRADE Group’s chemicals subsidiary?
BRADE Chemical Solutions is a full-fledged company now. We have partnered with Dow Chemicals for the deployment of polyurethanes (manufacturing chemicals), and we are hoping to provide production chemicals to specific clients in the E&P business in Nigeria, as well as some service companies that control a huge chunk of the upstream chemicals business across sub-Saharan Africa. Our warehouse for the chemicals is at Isolo; it is up and running. Hopefully, it won’t be long before we move onto the next phase – setting up a blending facility.
As mentioned earlier, most of the business for us now in chemicals is with polyurethanes. They are polymers that are used for different types of insulation foams. For the oil industry, we are looking at standard production chemicals such as corrosion inhibitors, biocides, defoamers, demulsifiers, methanol, paraffin inhibitors, H2S scavengers, dispersants and a host of others that are consumed daily in the industry.
There is monopoly on some of these chemicals by foreign companies. However, as a Nigerian company working with a reputable name like Dow Chemicals, the opportunity is there if we can show capacity.
What is BRADE Group’s growth strategy?
We have also launched BRADE Petroleum & Engineering Services, an EPCI and marine logistics company. That is another area where we see huge growth potential. We are all aware of the major developmental projects coming up in the industry. NLNG Train 7 has commenced and Shell alone has three projects. Fabrication work for these projects will employ thousands and keep every fabrication yard in Nigeria busy for the next few years.
Unfortunately, we do not yet have enough fabrication yards in Nigeria to accommodate the huge growth that is about to happen in the oil industry, in addition to NLNG Train 7. So, fabrication and marine logistics are growth areas, albeit heavily capital intensive. All of our work on these areas will be under BRADE Petroleum & Engineering Services.
While we may not set up shop for everything, aligning with the right local partners ensures that we can come together to execute and manage projects successfully through delivery. It’s about moving the industry forward with clearly visible, positive results for the entire country.
How instrumental do you think the Nigerian Content Development and Monitoring Board has been in building local capacity?
I must commend their efforts and I hope these efforts are sustained. The present executive secretary is doing a lot. I have listened to him speak several times; he talks tough, and is very serious. I hope that the ideals he talks about are maintained. They must keep the focus on their objectives and not be hijacked by other umbrella groups in the Nigeria oil and gas space with other interests.
More effort to vet and support “credible local companies” through the NCD [Nigerian Content Development] fund must continue, as this remains the major problem facing the local players.