LEVERAGING CAPABILITIES

Oman 2019 | ENERGY | INTERVIEW

STS' main focus is investing in national development and further growing its initiatives to train and employ more Omanis.

Alex Clark
BIOGRAPHY
Alex Clark has over 25 years of experience in the oil and gas, petrochemical, heavy industrial, and mechanical engineering construction industries, with particular expertise in executive and general management. He is currently the CEO of STS, prior to which he was STS Group General Manager. He has a degree in civil engineering from the University of Sydney and a master’s in engineering management from the University of NSW.

What key initiatives is STS undertaking to diversify its business offering?

One initiative to diversify STS is our recent acquisition of Refrigeration Engineering International (REI), a specialist process engineering company with a global reach. STS decided to go down the process engineering route for a number of reasons. One is that it greatly diversifies STS' business and provides us with access to a number of different clients and geographical locations. Another reason for the acquisition is that it enables us to leverage our significant fabrication and manufacturing capabilities, and we see a strong offering as a group to provide process engineering and fabrication solutions together. The second key initiative we are working on is developing a piping well overlay facility in Ras Al Khaimah, which will be commissioned in 2Q2019. The facility will specialize in pipe cladding on a commercial scale. The main focus of that business is to improve our ability to serve our regional client base and market. The third initiative is through our recently acquired detailed engineering capability in Muscat. This has about 50 engineers in all disciplines. One of the main reasons we went down this path is that many of our clients demand a certain amount of engineering services from us. The fourth initiative is expanding in Duqm, where we are establishing a major asset to serve the downstream oil and gas industry there, which will be a significant segment in terms of investment over the coming 10 years.

How key are joint ventures to STS' business?

Our joint ventures represent around 40-50% of our business overall. There is one key benefit: knowledge. STS would not have been able to participate in any of the businesses that we currently have through our JVs if we did not have a strategic JV partner. One of the biggest mistakes organizations make in forming JVs is that they partner with entities that do the same things they do. With all three of our JVs, our partners have brought capabilities that we do not have to the partnership. STS brings the local market knowledge and know-how of finance, administration, and infrastructure, and our partners bring in their specialized know-how. These JVs are long term; they have been operating for at least seven years, with one in excess of 10 years. Having complementary capabilities is key in a JV.

Which sub-sectors of the industrial sector is STS most involved in?

Aluminum is one, which is an industrial metal manufacturing facility through our STAREF JV. Recently, we have been expanding our presence in the power sector. Our electrical and instrumentation group has been involved in power generation projects through the construction of power stations. We have worked with Finish group Wärtsilä and French company SUEZ (now ENGIE). We also have some involvement in the desalination industry. Generally, we try to stay in the oil and gas industry, though our industrial involvement is an opportunity to diversify our business and also leverage our capacities from the oil and gas industry. The requirements and standards in the oil and gas industry are extremely high, so it is not dissimilar to many of the standards and requirements for industrial projects.

How important is the involvement of Omanis in the growth of STS?

It is vitally important that we continue to train and employ Omanis into our business. STS currently employs 2,850 Omanis. Every year, we have an Omani Graduate Development Program. Another thing we are doing is opening a purpose-built training facility in 2Q2019. We have been training Omanis for years, and this has been spread over our various company offices, workshops, and other sites. This training center will be a proper designated facility and is 100% STS funded. Our shareholders want to reinvest in the market and help the general economy by training and developing young Omanis.