A unique business modelJune 23, 2021
Ali El Ali, managing director of Zakher Marine International (ZMI), talks to The Energy Year about the prospects for Abu Dhabi’s new upstream expansion projects and the company’s new joint venture with Mozambique’s NOC. ZMI supplies a variety of mobile offshore units for oil and gas, renewables and construction projects.
How do you assess the government’s pandemic response and its communication channels with industry players?
On the whole, the UAE government responded a lot faster than the rest of the world. Our leadership here understood that the welfare of its population, both citizens and expats, is very important to maintain. Businesses have had to adapt within their specific sectors and business lines, but we saw the government supporting companies and ensuring that the government, through the central bank, designated a monetary policy stimulus package. The package was aimed at supporting affected sectors of the economy. Those measures supported us during 2020 and limited the impact of the global crisis on the UAE economy.
As many upstream expansion projects were announced early in 2020, how do you see them materialising in the short term?
In my opinion, ADNOC took a very prudent approach, which was to avoid any extreme reaction to the Covid-19 situation. The Dalma Gas Development Project was cancelled only a month or two after being awarded to Petrofac. Dalma was one of many projects that were already in the pipeline. However, the ongoing maintenance and opex projects are continuing irrespective of Covid’s impact.
ADNOC has not reduced or downsized its capex programme. They are still on track for their 2030 targets and vision. I believe that this has been a very prudent approach. Of course, cost will always be a factor that needs to be discussed, whether it is at ADNOC’s level or whether it goes down the value chain to our levels.
That being said, despite Covid-19, there is still a big market for us to operate in, and remarkably, we’ve been able to assign most of our fleet. Only a small part of our fleet had to go off-hire, due to restrictions on travel and immigration to Saudi Arabia.
How has ZMI navigated the coronavirus pandemic?
When Covid-19 hit, we had to adapt quickly both in our business model and in how we were dealing with the clients, as well as internally in how we dealt with our day-to-day operations to ensure that business as usual.
One key concern was the welfare of our offshore crew. We have tried to manage that as effectively as possible. I think the scale on which we operate helped us compared to some of our smaller peers in the market. Our scale has allowed us to manoeuvre and move certain people around and adjust certain aspects of our operations in order to ensure business continuity.
ZMI has been in talks with Mozambique’s ENH to enter their promising offshore market. Tell us about this.
We signed an exclusive joint-venture partnership agreement with the logistics arm of ENH. We had seen that Mozambique was going to become a large player in terms of offshore gas in the coming decade. With it being in East Africa rather than West Africa, the proximity helped us and provided us comfort in doing business.
We signed the deal, then established and incorporated the joint venture. It has its own board and its own team, and we have been working on various tenders with various IOCs operating there in EPC projects.
Covid-19 couldn’t have come at a worse time for this launch because I believe we would have been able to secure some contracts through this joint venture during 2020. However, we do anticipate that the market will grow quickly for us next year, subject of course to the pace of the Covid-19 recovery.
How did ZMI stand out among other players in vying for this position with ENH?
Although we were in contention with a number of other companies, we were handpicked because of the uniqueness of our business model. I believe that it happened because we are a family business and due to our deep involvement in our operations, as well as our ability to move and take decisions quickly. ENH saw certain principles in our business that they liked.
We saw that we shared a vision with ENH to not only grow a business but to also one day be part of the community support, committed to the development of the country. That’s something that we are looking to do. Mozambique has a long historical connection to the Muslim world, especially the Gulf, which a lot of people don’t see and aren’t aware of.
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