Ambition to be firstJune 2, 2017
Rami Qasem, GE Oil & Gas CEO and president for the Middle East, North Africa and Turkey region (MENAT), talks to TOGY about adding more capabilities in the region and the anticipated merger with Baker Hughes. GE Oil & Gas, one of the world’s largest providers of oilfield services and equipment, is awaiting regulatory approvals for a planned merger with Baker Hughes announced in October 2016.
GE Oil & Gas specialises in providing oil and gas drilling equipment and subsea systems, including turbomachinery solutions and downstream processing. It is working to service Abu Dhabi’s downstream diversification through the refining and petrochemicals sectors, with a wide portfolio of applicable technologies, including process centrifugal compressors, centrifugal pumps, turboexpanders for ethylene plants and hypercompressors for low-density polyethylene production.
• On cycles in the industry: “The industry is always going to be cyclical, and the cycle is longer than probably any other cycle, but the recovery is going to be there and the market will be there.”
• On the merger: “GE Baker is going to be coming into the region and into the market. I don’t want to say as disturbers, but more as a company that is going to be the second biggest oil and gas company with the ambition to become the first.”
Qasem also discussed the company’s regional strategy, operating in a low price environment and the digital innovations GE is bringing to the industry. Most TOGY interviews are published exclusively on our business intelligence platform TOGYiN, but you can find the full interview with Rami Qasem below.
What is GE’s focus in the region?
Our focus is to expand our local investment, train more nationals in our advanced digital technology, and partner with institutes and universities to ensure we have a pipeline of trained professionals that can support us in serving the oil and gas industry.
We continue to expand our footprint in the region, especially in Saudi Arabia and in the UAE. For example, we have opened facilities in Musaffah Industrial Area, Abu Dhabi, which serve the oil and gas upstream industry. The facilities include state-of-the-art calibration equipment for pressure and moisture sensors, particularly for the oil and gas and aerospace sectors, in addition to providing onsite repair and software upgrade services.
We also have the GE Oil & Gas Multi-Modal Manufacturing & Technology Center in Jebel Ali Free Zone, which features dedicated repair, customer service, manufacturing and assembly centres, which are helping improve the speed of service delivered by being closer to our customers.
Furthermore, our first-of-its-kind Monitoring & Diagnostic Center in Dubai monitors 300 gas turbines across MENAT remotely. The extended services provided by the centre enable customers to achieve greater levels of productivity and efficiency. The GE Customer Solution Center (CSC) in Jebel Ali is the region’s first hands-on advanced solution centre that puts customers operating across the energy value chain at the heart of GE’s Oil & Gas Digital Solution capabilities. The CSC serves as a critical hub for collaboration as well as in addressing customer needs.
We are also expanding the capabilities of our services facility in Doha, Qatar, in partnership with QP [Qatar Petroleum].
Everything we do is centred on adding more capabilities to meet the challenges faced by the oil and gas industry. Through our strong local presence, and advanced technologies, we are supporting our partners to enhance their resource use optimisation and strengthen efficiency and reliability. You cannot do this unless you are close to your partners, and that is something that we have been focusing on.
Can you provide some details about the merger with Baker Hughes?
We have announced an agreement under which GE plans to combine with Baker Hughes to create a new fullstream digital industrial services company. This combines the technology, manufacturing and digital platform of GE Oil & Gas with the oilfield services offerings and technologies of Baker Hughes.
The combined company will have a global portfolio of assets that will drive efficient delivery of services to customers, as well as create an opportunity for sustainable investing through the industry cycle.
The transaction is subject to approval and we are committed to working constructively with the relevant government regulators to achieve the necessary approvals. Until then, our two companies will continue to operate business as usual.
Is GE Oil & Gas confident about the recovery of the industry and the market itself?
The oil and gas industry is always going to be cyclical, but there are concerted efforts to drive the industry’s growth. We are positive that the market will be stronger and the industry will continue to see significant new investments.
The important point is not to be distracted by short-term volatility. It is important to invest more in R&D and technology, and we believe that constant innovation is key to sustaining our industry.
In today’s environment, our strategy is to leverage our diverse offerings and digital expertise to help customers drive efficiency and productivity through data, analytics, and software. The digital industrial technologies that we have pioneered will lead the way, enabling our partners to achieve unprecedented levels of productivity, efficiency and reliability. The world needs more from the oil and gas industry, and we continue to focus on how we can have more efficient technology and more environmentally friendly solutions to support the sustainable growth of the industry.
How much is the Predix platform needed today?
Predix is the world’s first and only cloud-based operating system built exclusively for industry. It can capture and analyse the volume, velocity and variety of machine data generated across the industrial world within a secure, industrial-strength edge to cloud environment. The predictive analytics facilitated by the industrial internet enables our partners to identify issues, not when they happen, but even before they manifest, leading to reduced downtime for operational assets.
A year ago, I believed about 20-30% of companies would want or need Predix, but now, with a better understanding of the value it can bring them, I’d say 90% of companies can benefit from Predix.
Currently, less than 5% of the oil and gas world is connected and only 1% of data is used for decision making. As the industrial world becomes more connected, the ever-increasing amount of information presents an opportunity to improve safety, reliability, asset health, operational efficiency, and profitability.
What other solutions do you have to offer?
The right digital solution always starts with an understanding of our customers’ desired outcomes. Based on that outcome, we draw on our full set of capabilities to configure a solution that helps our customer meet that goal.
We offer a breadth of digital industrial solutions. For example, on the production side, through our digital industrial technologies, we can give operators a full view of their wells, improving their operations by giving visibility on well performance and the analytical insights to optimise production and lower cost.
For pipelines, we can help operators improve risk management and make quicker, faster decisions that maintain safety by integrating various sets of data that affect pipeline integrity and by providing analytical insights to predict potential issues and prioritise resources efficiently.
For plants, such as LNG, we can package a solution that maintains high availability reliability throughout the plant through advanced monitoring and diagnostics for both rotating and static equipment, whether made by GE or another OEM, plus the insights needed to make them run better.
For enterprise, we can knock down information silos and offer knowledge management solutions that drive better performance across different divisions and enable every operator to be the best.
All our facilities across the region promote localised innovation and focus on knowledge sharing with local technical professionals. We are committed to building their skills as part of our long-term commitment to the region.
In local talent building, we also launched the GE Oil & Gas University program (OGU) at the Petroleum Institute in Abu Dhabi, offering employees the opportunity to acquire fundamental management and technical skills to consolidate their overall understanding of the oil and gas industry.
What were the highlights for 2016?
One of the highlights was winning the ‘Best in Supplier Development’ honour at the iKTVA Excellence Awards in the first anniversary of the launch of iKTVA by Saudi Aramco. The award recognised our efforts in developing the capabilities of in-kingdom suppliers in a number of areas, such as technical capabilities, technology transfer, quality improvement and integration into the international supply chain. Other considerations included GE’s costs in supporting development of local supply-chain capabilities. This is indeed a great testament to what we are doing to create a dynamic local supply ecosystem.
In 2016, we also delivered the first six modular Frame 6B gas turbines for power generation application in the UAE. The modular approach was the first implementation for a modular gas turbine in the Middle East. Further, our multi-stage pumping technology in the UAE has been instrumental for the execution of the first CO2 reservoir injection application for enhanced oil recovery in the Middle East. The injection process had reused CO2 from an industrial plant to help increase well production.
We also set a milestone by delivering high-efficiency gas compression trains for the Phase 1 of Saudi Aramco’s Master Gas System expansion project, which were assembled at the GE Technology & Manufacturing Center in Saudi Arabia. It is a matter of great pride for us to deliver the made in Saudi stamp on our turbines.
We also partnered with Sonatrach in Algeria for revamping of one of their biggest fields. Further, we launched the GE Customer Solution Center in the UAE, which offers customers as well as students the unique experience of engaging in a real world industrial environment and gaining hands-on experience using GE’s latest technologies and solutions.
Our focus for 2017 is to make sure that we continue delivering operational excellence and focus on serving our customers better. Our goal is to continue to provide best-in-class technology and drive more efficiency, reliability and optimisation.
How do you see 2017 developing for GE Oil & Gas, and 2018 onwards?
We are well positioned in our market, and have the right people, right technologies and infrastructure in the right place. We are continuously expanding our local and regional footprint and have built a massive advanced manufacturing infrastructure that supports our customers, and brings us closer to them.
We see further progress and collaboration with our customers and partners in the coming months as we strengthen our localised footprint and support the region’s digital transformation. We expect to see more commercial innovation as well as more adoption of digital industrial technologies to drive efficiency and productivity.
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