REGIONAL BASE IN ABU DHABI SINCE 2014

Abu Dhabi 2020 | ENERGY | B2B

TBY talks to Donal J Dempsey, Vice President, Engineering & Consulting, Middle East & Africa at SNC-Lavalin, and Simon Evans, Director of Digital Engineering at SNC-Lavalin, on major projects in the Emirate, digitalization, and human resources challenges.

Donal J Dempsey
DONAL J DEMPSEY
Vice President, Engineering & Consulting, Middle East & Africa
SNC-Lavalin
Simon Evans
SIMON EVANS
Director of Digital Engineering
SNC-Lavalin

What are some of your key projects in Abu Dhabi? How important is Abu Dhabi within the context of your growth strategy?

DONAL J DEMPSEY: Having our regional office based in Abu Dhabi since 2014 has allowed us to grow and expand our offering to serve both the UAE and the wider region. Our substantial presence here means we cover all of the group's core sectors including oil and gas, infrastructure, mining and metallurgy, nuclear, and clean power. Doing business in Abu Dhabi is incredibly straight forward, especially when we consider work flexibility, visas, and travel. Moreover, there is renewed optimism in the local and global energy markets, and we have seen a market turnaround in the last 12 months with a more stable equilibrium in oil prices. This positive sentiment is contrasted against more recent volatility that has caused the industry to refocus on cost efficiencies and restructuring. The recent restructuring at ADNOC culminated in a number of consolidations. A major focus now is on downstream and having high-value products, that is being driven by a burgeoning middle class in the Far East with a sizeable demand for plastics and derivatives. Additionally, there is a major focus on Gas and to develop the ultra-sour gas with the eventual goal of making the UAE a Net Gas Exporter in time to come. ADNOC has recently announced a USD45 billion investment in downstream infrastructure in Ruwais, with a USD132 billion investment overall for oil and gas in the UAE over the next five years. Keeping all this in mind, the company is at a pivotal location at the moment. There is a marked effort on adding in-country value by bringing value to the entire economy through growth and diversity. There is increased opportunity in downstream and chemical derivatives and these new initiatives fit well within the context of our strategy.

What is your assessment of the growing significance of gas and what other regional projects are you involved in?

DD: There have been substantial infrastructure developments in the UAE and a growing need for gas. Expo 2020 in Dubai has seen a sizeable amount of gas being exported from Abu Dhabi to support the project. Consequently, gas is being driven into the petrochemicals sector, which is part of a wider effort to get the gas out of the oil and into the petrochemicals, refining it further into the chemical derivatives. Moving forward, gas to power and gas to derivatives are the two key focal points across the region. For over 50 years, SNC-Lavalin has been successfully delivering first-class projects to the Middle East across all our sectors - Oil & Gas, Mining & Metallurgy, Infrastructure and Power. The company is working in all the GCC countries, including UAE, Saudi Arabia, Kuwait, Oman, and Qatar. We have three offices, which include our home office in Abu Dhabi, and two regional offices in Dubai and Sharjah that also serve Iraq, the IOCs, and central Asian countries, mainly Kazakhstan and Azerbaijan.

What is the significance of digitalization in the oil & gas industry, and with what digital solutions do you currently engage?

SIMON EVANS: It is widely cited that digitalization is not a technological challenge; it is a people challenge - which involves getting our people to work differently and changing processes. Digitalization is radically changing how companies operate. Over the next decade, we will see a number of technology advances in automation, data analytics and design, driven by the underlying need to reduce operating costs and improve efficiency by optimizing and standardizing production methodologies. With advances in sensors and automation, it is likely that all high-hazard sites will be fully de-manned during normal operations by 2030. Standardized design will mean we see fully IoT-enabled, automated facilities, with data analytics providing optimized production and uptime. Ultimately, perhaps by 2050, exploration, development and interventions will be completed remotely. SNC-Lavalin is deploying a number of solutions to our clients; for example one particular solution works with existing data systems to optimize the spare parts holdings of assets and fleets. We do this by blending data analytics with our engineering expertise to deliver greater insights and outcomes. This is an important differentiator as the algorithms are produced by experienced engineers working with data scientists and mathematicians to create real-world analytical capabilities. Following its implementation on a major O&G operator's range of assets, we ultimately identified potential savings of USD179 million from USD214 million operational spares inventory in one basin alone. To date, the client has confirmed savings of over USD94 million. These solutions, when deployed properly, can generate serious cost saving benefits.

How can we overcome resistance to digitalization changes?

SE: It is important to start with decision makers and changing their mindsets when it comes the topic of digitalization. It is widely acknowledged by everyone in the region, and around the world, that digitalization is happening. Therefore, digitalization needs to be taken seriously if companies wish to stay relevant in the next 5-10 years. There needs to be the right level of sponsorship within an organization to ensure the correct implementation of digital solutions. Value needs to be demonstrated to show how and why these solutions need to be adopted. As an organization, we have to provide credibility in order to have the right to help transform other companies. We are digitally transforming ourselves internally, with digital a core part of how we operate. We are not trying to be a technology company, we remain an engineering company at our core. We deeply understand our client's problems, and the oil and gas industry, which is why we are uniquely placed to advice how digital technology can help the sector.

What are your expectations for the future?

DD: The downstream segment will provide a catalyst to obtain higher value products from the barrel. Digitalization is another obvious area that will add further value and disrupt the industry. Moreover, infrastructure development around the Middle East has renewed focus, increasing the demand for gas. Looking ahead, it will be even more essential for businesses in oil and gas to invest in workforce learning and development in order to keep up with a rapidly evolving industry environment and achieve their growth targets. At SNC-Lavalin, we are committed to developing local talent through knowledge transfer in the countries in which we operate to ensure that our host countries retain the knowledge and capabilities of their well-trained local workforces into the future. This approach supports Nationalization strategies led by various governments in the region to train and develop their local workforces with the necessary knowledge, skills, and competencies, thus maximizing employment opportunities for its citizens. We do this by bringing technical skills into our host countries and providing exceptional capability programs for our clients and employees in the Middle East. Currently, we have three specialized training centers in Oman, KSA, and Kuwait, and we are applying this in-country value model to the UAE as well. University graduates from chemical, electrical, mechanical, and instrument engineering backgrounds have the opportunity to be trained in an 18-month specialist program to develop the knowledge and skills required to perform highly complex jobs within the industry to the highest standard.