Giacomo Bonfanti

Would you give us a recap of what GDI was up to in 2020, and what some of your biggest achievements were in terms of projects in 2020?

2020 was all about adaptability. GDI focused on adapting, and one of our biggest challenges was the disruption of the supply chain for the oil and gas division because of COVID-19. The oil and gas supply chain is interconnected globally, and this was a big challenge we had to address in April-May 2020. This was especially because we completed a project in Serbia to construct a direct pipe river crossing. It was a big challenge to guarantee the safety of all the personnel who were overseas developing the project. We used all the different channels we had available, such as embassies, different airlines, connections, and clients in Europe to make it happen. We completed the project and got all the people and machinery successfully back on Mexican soil. The other major project GDI finished was a hydrocarbons storage facility in Veracruz the largest one in Mexico as of today. The big challenge for us there was having around 2,000 people on one site at the same time when COVID-19 made having people congregate so difficult. We had to manage all the anxiety and uncertainty, and it was five months of extreme, fast, and dynamic learning every day. Just like Darwin used to say, it is not the strongest species that survives, it’s the one that adapts faster. Furthermore, the oil and gas industry is one of the industries where digitalization and related technologies were not used at all. We had to learn quickly and ensure that everyone was on the same page at the same time. It was complex, but through daily work, meetings, and actions we were able to establish the necessary procedures to ensure our personnel’s safety, the correct flow of the supply chain for the project, and the correct alignment between the port authorities, client, subcontractors, and GDI. The prioritization and correct flow of information became a priority. We completed that project successfully, though it required us to learn how to perform the work in a different and faster way. For example, we had to develop all the sanitation and social distancing procedures, introduce face masks, and identify all the vulnerable personnel while maintaining production level and alignment of subcontractors and clients.Our goal was to create an atmosphere of camaraderie and establishing a clear motto: “In GDI we make it happen“. In hindsight, that achievement was rewarding, but it was also stressful so I would like to thank everyone involved for working daily regardless of the current global context. Those were the major oil and gas sector projects we completed in 2020. In GDI’s mining division we completed the development of the Mulatos Mine and we are starting a new mine called La Yaqui Grande.

GDI is most well-known for doing construction work in the mining industry, but in 2019/2020 your aim was to focus on diversifying your portfolio. Are you still going ahead with this plan post-pandemic?

One definite lesson from before and during the pandemic was the need to have a geographical diversification of the company’s activities. We did this successfully. Our project in Serbia was very successful, and the current project we are developing in Nicaragua is also one of the first steps we took down the diversification path. It has been clear to us as a group that develops infrastructure that we also like to verticalize certain aspects of the construction process that are not necessarily construction per se, such as fabrication of certain components that are needed for a plant or certain electro-mechanical works. We created a financial entity called GDI Capital with the goal of identifying specific companies and projects where the company can invest capital. The aim of creating this entity is to diversify some of the operations of the company. A financial company is managed differently from a construction company, but this is one diversification step we took in 2020, and we are moving forward with that goal to identify specific projects and companies that could be helped by our knowledge and capital to foster growth through this pandemic. GDI Capital will function like a venture capital entity and identify projects where money can be invested and returns made as part of the group. The idea is to take advantage of the market right now to put the capital to work in industries that are complementary to our industry. We are currently going through the structuring process for GDI Capital.The idea is to be cautious and conservative while putting some of the capital we have to work in industries that are complementary to ours, but that do not jeopardize the returns we already have at GDI. Mining is one area we have identified as a possible place for some of our capital investment, but also where we can be an active partner in the development of these projects. The aim is to find different partners where we can make a project work because the key is to have complementary projects. We do not want the construction company competing with the financial company. GDI Capital should be up and running by mid-2021.

What countries is GDI targeting for diversification in Latin America and globally?

Europe is one continent where we really liked to work. The rules are clear for any new company that goes into Europe, and it is easy to do business there. We are currently assessing the opportunity for a project in Ukraine for our mining division. The pandemic has given us a conservative view about what countries will do about the management of their investments in the future. In addition, Colombia is one of the countries where our midstream oil and gas division could have great potential. We see many pipelines that might be needed there. Before being a full EPC for the midstream oil and gas industry, we started as a pipeline contractor in Mexico. We are currently working on green and brown field project opportunities in Colombia. The changes in the North American geopolitical situation are extremely positive for our company. Gas will be the bridge to driving forward the green energy transition we all need and want to happen in the short term. So, I am still positive that there are opportunities in the midstream sector specifically for gas in the US. This is one example of where we should be pursuing opportunities for geographical diversification.

What do you envision for the future of the construction industry?

I believe the next years will be booming for infrastructure projects. The world has created massive amounts of debt everywhere and, in order to transform such debt into a countries wealth, is important to create infrastructure that will increase productivity in the years to come. Better highways, airports, green energy infrastructure, gas infrastructure, greener data center (today everyone talks about going green but we forget the energy big tech uses is mostly oil and gas). These are the types of things the world needs in order to move towards a better tomorrow and in GDI we are ready to be that agent of change, as I always say, creating successful teams with Clients and suppliers.