Nigeria 2017 | ECONOMY | INTERVIEW

TBY talks to Manssour Jarmakani, Group Co-CEO of Jagal, on strategic upstream alliances, supporting the growth of local firms, and minimizing supply chain costs.

Manssour Jarmakan
Manssour Jarmakani is a Nigerian businessman who studied at the American International School in Lagos and the American Community School in Hillingdon, UK. He then studied management, marketing and IT logistics at the D'Amore-McKim School of Business at Northeastern University in Boston. He has been part of the leadership of Jagal since 1998. He is currently the Group Co-CEO of Jagal.

Jagal Energy is the oil and gas solutions provider of Jagal and a prominent player in the Nigerian upstream sector. How are the low oil prices impacting your operations?

Worldwide, low oil prices are challenging companies to think differently, change the way they do business and force them to look for innovative solutions. We need to understand how we can consolidate, partner, and synergize to do things more economically. For our energy division, we operate as contractors and we have a lot of joint ventures and strategic alliances. We experienced a decline in work and in future work on the table. Previously, we were bidding on numerous projects at the same time. Today, we have very few projects on the horizon. At Jagal Energy, we have wholly owned indigenous companies, like Nigerdock, and we also have partnerships like NigerStar7.

The government is working on a new petroleum regulatory framework. How do you expect this legislation to influence the future of the sector in Nigeria?

The most important legislation for the sector has been the Nigerian Content Development Act. It has made sure that companies that have capacity in country are able to bid on domicile supply chain, procurement, engineering, and fabrication contracts. Therefore, The Petroleum Industry Bill (PIB) the government is developing has to be compatible with what Nigeria has to offer. Many companies have built up capacity across many different parts of the industry and they need to be utilized and put to work. There are many Nigerians who have high levels of competency, but we are losing them because of a lack of work. It is important that the government engage its partners in the IOCs and the local oil companies, as well as the private companies offering engineering services and supply chain, logistics, and offshore drilling support.

What are your strategic priorities for Jagal Energy in 2016?

This year is a survival year; a lot of companies are trying to manage the downturn. Our strategy is to push for work and see if we can partner with IOCs and the NNPC to unlock projects and work together to find solutions, because it would be a shame to have such an excellent capability in-country in our sector and lose it due to lack of communication or progress on projects.

Can you talk about the evolution of the demand for Hello Products?

Manufacturing across Nigeria has taken a hit from the foreign exchange issue. It has made access to raw materials a challenge and consequently this has had an impact on the ability to produce finished goods. Supply chain and time cycle for turning raw materials into finished goods is impacting a lot of manufacturers, and many of them have closed up shop because of that. Hello Products has been manufacturing for over 35 years. We have a range of products and most of our raw materials are locally sourced; however, we have some key ingredients that are only made in two or three places in the world. We are forced to import these raw materials. Aside from manufacturing, the cost of goods for the common Nigerian has also risen dramatically, and this is compounded by inflation and price instability. Nevertheless, we have a couple of new products in the pipeline.

What are your expectations for the year ahead?

Nigeria is taking the right and tough decisions; the government is not there to be popular. Nigeria is trying to address critical gaps in its economy. It is important to see Nigeria diversify its portfolio so that it is not reliant only on one industry. At Jagal, we engage in other forms of investment and revenue yielding business besides oil and gas. Jagal has made significant investments to ensure domestication of data in Nigeria. Rack Centre, a state-of-the art TIER III Certified data Centre offering vendor-neutral colocation services, has been operational since 2014.