Local exec on Ghana’s competition, outlook and workforceNovember 21, 2018
Joseph Ampomah-Mensah, the CEO of J&P Engineering, talks to TOGY about competition in the market, the outlook for growth and the development of the local workforce. J&P Engineering is a local EPC company that concentrates on engineering detailing and procurement and construction.
• On competition: “The competition is not real. A few people control the market. It is not an actual competition.”
• On outlook: “Currently two big developments are coming: the Aker production, exploration and development and the one for ExxonMobil.”
• On labour: “We have a very talented workforce, but they have to be directed towards certain standards.”
• On financing: “The financial industry views us as very risky, so it is very difficult to get financial backing, and that is where we lack. Technically, with the competency, we are poised and positioning ourselves, but the financial capacity will be a challenge.”
Most TOGY interviews are published exclusively on our business intelligence platform, TOGYiN, but you can find an abridged version of our interview with Joseph Ampomah-Mensah below.
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Do you see the market as being very competitive?
The competition is not real. A few people control the market. It is not an actual competition. Most engineering companies like ours started small and are trying to grow the market and industry. However, some have certain opportunities that are not open to the rest of us. They will tell you to get certain licences and you spend lot of money getting them. At the end of the day you have to struggle to penetrate the market. The current chief executive of the Petroleum Commission is trying to break up the monopoly so the market is free and real competition can exist.
Are you expecting more growth in the marketplace?
Currently two big developments are coming: the Aker production, exploration and development and the one for ExxonMobil. These are huge projects for us, and we think that if the market is opening up, we will be able to participate. The EPCs like us are few.
What we do, we try to do with local participation. We try to get foreign companies that have expertise, and then we do a JV with them for particular, case-by-case tenders. Recently, we had a tender from a company that represents Aker Energy to provide OCGT services. We are trying to co-operate with a company from Norway who has the expertise so we can have a partnership to be able to tender for this project. If there is real competition in the market, we will be able to have some of these partnerships and successfully bid for such projects.
How would you assess the talent pool or skill level among the Ghanaian workers in the engineering sector?
There are those that do not have the discipline for it, but it is because the industry is young. We have a very talented workforce, but they have to be directed towards certain standards. We are not ISO certified, for instance, but we have done processes and are now undergoing reviews to be able to be certified. In the same way, most of the artisans have not been certifying the skillsets they have. When we have a project and we know that within six months it will be signed, then we begin to certify them. They already have the skills.
If it is welding, we do the welding certifications, and the same for any other skill that is required for a project. We also have a list of procedures and processes that are standards that we will have to engage them in and let them read and understand that this is the way we do things, these are what the requirements are, and these are the requirements that you need licences or certifications for. In less than three months’ time we are able to prepare them, however, in some instances, I have brought in expats from Malaysia and India to be able to support them. They supervise and transfer knowledge. Last year, we were building a biomass boiler for a factory in Tema. We brought two people from India and we were able to finish the project successfully.
The government has recently signed a deal for an LNG receiving facility in Tema with China. You have worked with GNGC in the past. Could you lend some expertise for this project?
I was part of a project that was undertaken in the very recent past. We built LNG regasification stations for Trojan Power. We built a small-scale LNG receiving terminal, not a storage terminal at the Tema hub and it is still there. I was very happy when I heard this announcement because we have done works with an Indian company, INOX-CVA, who are into the production of LNG equipment. We collaborate with them and we have built a regasification station and an LNG receiving terminal. We are in a very good state if such projects come on.
What are the challenges local companies face when expanding?
We are positioning ourselves for the major industrial takeoff which the current government wishes for the country. Developing skillsets, getting the right standards, being certified and getting the right tools in terms of engineering software will position us in terms of competency.
The other challenge is financial. Manufacturing companies get little support, not to even talk about engineering companies. The financial industry views us as very risky, so it is very difficult to get financial backing, and that is where we lack. Technically, with the competency, we are poised and positioning ourselves, but the financial capacity will be a challenge. This is why, in most cases, we see external collaboration with international companies so they could bring not only the technical support but also the financial model to help push this. The strategy is international collaboration and building local competency. These two strategies will help push us forward to be able to expand in the near future.
We want international companies to view us as equal partners and not people looking for handouts. Sometimes, when we speak to international companies who are looking for collaboration work, they think we are looking for help, but that is not the case. We want partnerships with partners that will be able to give us knowledge transfer and backbone, because the local content policy gives indigenous Ghanaian companies a lot of opportunity, and for the international companies to benefit here – when they join us in partnership and they could recognise us as a local content JV – there are immense opportunities we could realise.
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