Cross-border challenges in Congo

Republic of Congo

Alexandre Bourgois, Congo resident manager of Subsea 7, oversees the topside segment of the Lianzi development project, a cross-border development between the Republic of Congo and Angola operated by Chevron. More than one year into the project, Bourgois spoke to TOGY about the challenges associated with cross-border developments and lessons to be learned from the experience.

What are the challenges of a cross-border development?
Cross-border projects require a great deal of human resources. These projects are incredibly stressful and cannot rely solely on only one or two people. The difficulty is to establish a good collaboration with the client in order to act as a team during the realisation of the project. However, that does not mean there will not be more discussion and negotiation at the completion.
For example, during the Lianzi project, even if the laws for the unitisation of the cross-border field were signed before we started our operations, they were not in place and ready to be applied by the Customs and immigration services at beginning of the project. We had to work closely with the administration in order to mitigate delays.
Despite the creation of the inter-state committee to manage the overall protocol, decisions can take a long time to be made, and final word is taken in Brazzaville at a political level, not in Pointe-Noire. While the committee was very responsive, its rhythm was not suited to our field development schedule. During operations, it can be very costly to wait for decisions to be enacted.

Based on this experience, what approach would you suggest for cross-border projects in order to ensure better communication between all actors?
Both operators and contractors must have a better understanding of the difficulties associated with Customs clearance and staff immigration. These parties must anticipate logistics issues for cross-border operations at a very early stage in order to have the set-up in accordance with the protocol.
Preparation is the most important factor needed to understand how the administrative process will impact operations. Because each issue has an impact on the whole project, communication between actors is key, as new subcontractors or logistics agents joining the project may not know the process implemented by other companies. Having dedicated office staff with the authority to make decisions vastly improves project operations.

With the Lianzi project is close to completion, do you expect to see more opportunities in subsea engineering projects in Congo?
Because of the fall in oil prices, the market is currently quite low. Besides the projects that have been developing for some time, such as Nene Marine, Moho-Nord and Lianzi, I do not see any other field developments in the near future.
Even in the event that majors acquire new blocks, these operators will first conduct seismic studies, drilling and engineering before the development phase takes place. At best, this would take up to 10 years. In the current context, an additional two years will be needed as a result of the expense associated with seismic studies and drilling. This is especially true for deepwater development and engineering, procurement, construction and installation projects.

How will this downturn in activity impact engineering companies in Congo?
Within the crisis resulting from the fall of oil prices, some small companies will not have the same strengths than bigger, more integrated companies to get through the difficulties. Companies that can offer package services ­– those which provide their own vessels, remotely operated vehicles and diving facilities ­– will have a significant competitive advantage over smaller players. They can also be more actively present in local markets and closer to the client. This is especially true in Congo, where there are a lot of competitors.

Read our latest insights on:

• Angola
• Republic of Congo