Nigeria 2015 | ECONOMY | INTERVIEW

TBY talks to Simone Volpi, Managing Director of Orlean Invest, on expanding infrastructure, offshore services, and diversifying the economy.

Simone Volpi
After his early education in Italy, Simone Volpi attended Franklin College in Lugano, Switzerland where he graduated with a Bachelor’s Degree in International Management in 1996. He obtained his Master’s Degree in Integrated Logistics in Genova at the Universita’ degli Studi di Genova in 2002. Immediately after his studies, he was employed by the Orlean Invest Group and sent to Angola, where he started his career as a Commercial Coordinator. After one year, he returned to Nigeria, where he has remained to date. Since 2010, Volpi has been the Ag. Managing Director of Intels Nigeria Limited. Prior to this appointment, he had held numerous senior management positions in the Orlean Invest Group, both in Nigeria and Angola.

Your company is promoted as having the one-stop-shop concept. Can you elaborate on the advantages this concept brings to your company?

Intels, a subsidiary of Orlean, is Nigeria's leader in providing logistics services to the oil and gas industry. It manages three ports in Nigeria on behalf of the government, namely Onne, Warri, and Calabar. Intels has a concession created with the government through a public-private partnership (PPP), which started in 2006. Even though the concessions only started then, PPPs were already in place between Intels and the Nigerian Ports Authority (NPA). Thus, in a way, the government utilized an existing successful working relationship. When we arrived in the early 1980s, the logistics challenge lay in the fact that each company had its own base scattered widely. It was not the best solution, because each new company coming to Nigeria first had to acquire a block, and then had to meet office and housing needs, as well as perform seismic activities and commence exploration. If they were able to find something commercially viable, which of course depends on the size of the field; for example, they would have required support from a shore base. Most materials required in the oil and gas industry need to be imported from Europe, the US, Asia, and Brazil. All of these materials require clearance by the NPA for security and revenue reasons. The materials were coming to the port, and later transferred to a base. This begs the question of why the moment you receive your cargo at a port, you would again transfer the material, which at the end of the day incurs additional costs and increases the risk of damage.

Can you elaborate on the future plans for the Onne oil and gas free zone?

For Phase 4A, which was completed and commissioned in 2013, we reclaimed 900 acres of land from the water. Another important investment for the Onne oil and gas free zone is represented by Phase 4B, which totaled $3 billion and was made by Deep Offshore Services Nigeria. The purpose of the project is to develop a further 3 km of jetties, and 3.5 km of differently engineered jetties. Basically, these jetties will have longer lifespans than others, and here the depth is a mere 8m. Hence, there will be a dedicated area for the fabrication of infrastructure for offshore modules, such as jackets, and so on. Therefore, an 8m draft is more than sufficient, as materials will be sent out on barges.

How is the government working to diversify the economy?

I do not envisage the Nigerian government diversifying. There might be many initiatives, but they have not been implemented. The Petroleum Industry Bill is a good example. While its ratification date remains unclear, it is nonetheless of significance, especially for oil producing companies because it entails their payment of royalties and taxation. If approved, it would be of great significance for these entities. One could debate whether it is fair for Nigeria, the country that owns all of this oil, to generate further revenues. Until the law emerges, the oil producing companies will not invest, as they are to commit to multi-billion dollar projects without knowing whether in a few months their tax rates may or may not skyrocket. There are only a few projects going forward. When Nigeria complains that there are not enough foreign investors, they should look in the mirror and ask themselves the reason. All international companies, producers, or service companies are merely watching and observing the developments. It is quite normal that during an election period investments will stop, because everyone is wondering who will be the next president. Based on that, projects will change. In our case, it is easier because we are developing the ports, meaning that wherever the projects may be, they will still require our services. I believe that the Nigerian government should aim for greater consistency. If there is a clearer picture of where the government wants to go, it can only benefit Nigeria at the end of the day.