What opportunities did you identify in the energy sector in Nigeria when you entered the market?
I graduated in Petroleum Engineering in 1980 and having worked for two US oil companies—Kerr-McGee and Texaco—and gained valuable experience. I decided to foray into the Nigerian business environment in 1988 because at that time opportunities existed for Nigerians to get into the oil and gas sector. The PAI Group was, therefore, conceptualized in 1989 primarily as a procurement company of which we were agents for the US based safety shoe manufacturing company Red Wings. After five years, the company evolved into a service support company for internationally renowned companies with interest in Nigeria. The portfolio of 12 companies ranged from FMC, SOFEC, Samsung Heavy Industries, Air-Logistics, Dateline Services, LTT, Tubing Testers, and a host of others. PAI, therefore, became the local strategic partner to these international service companies providing local infrastructures, human resources and business support.
Approximately five years later with the experience gained, PAI forayed into acquisition and in 2000 acquired Transcoastal, a US-based company with operations in Nigeria in the fabrication and offshore construction business. The company was awarded a three-year fabrication contract by Chevron and successfully fabricated four offshore platforms and five helidecks of which we are proud to say those platforms are still producing oil offshore here in Nigeria.
Without a doubt Transcostal prides itself as the trailblazer of Nigeria content, of which the Nigeria Content Act was passed into law in 2012.
PAI moved into another acquisition when we bought the internationally recognized pipe coating company Bredero Price based in Nigeria, which we grew significantly. We have continued on an acquisition spree and recently concluded the acquisition of Ascot, which is a well-known company with the largest fabrication yards in West Africa with capabilities for offshore construction, marine fleet, heavy equipment, pipe coating plants, and calm buoy docks within the facility. This facility has the ability to fabricate heavy structures up to 10,000 tons.
What do you plan to do with the Ascot facilities?
There is significant potential with Ascot. The facility has the ability to build offshore platforms and decks including calm buoys. We are in dialogue with various international partners in their areas of expertise where we have the infrastructure to support them. The facility will offer minimal entry costs for these companies because we have a functional base. We have pipe coating, a marine division, a dredging division, and we also have the ability to do onshore pipeline construction as well. That facility, therefore, covers the entire spectrum of our construction business. We are looking for more international partners to develop strategic relationships in order to grow into a full EPICC company of choice in Nigeria.
How have your foreign partners reacted to the new Buhari administration?
The reaction is positive, because they could see that there is a serious sense of purpose from the present administration; however, there was also the cautiousness that is expected during the infancy stage of a government. It is early days. Now that ministers have portfolios, policies will start coming into place and that will start driving the economy—2016 will be a much better year, and a defining moment for the new administration.
What are your expectations for 2016 in terms of your business and the country as a whole?
Since Nigeria's economy is dependent on oil, it is a sticky situation. If oil prices increase, it would be a good thing for the country; however, if the prices stay as-is, the country will have to stay with conservative policies. The administration has come in to try to cut excess costs, which will help save money for the country, but if oil prices stay at the same levels, it will be difficult for them to go into robust projects and fund change. Also, the fiscal policies have not yet been cast, but if they are a lot more lenient and liberal, that will attract investors. For the oil and gas industry, this is a time for injecting creativity into project execution with the aim of cutting cost; that is the motto and goal of our company at this time.