With 48 years experience working in the oil and gas and industrial sectors across six continents in multicultural environments, and managing multicultural employees with over 10 of those years spent in Nigeria and Africa, the Chief Operating Officer of Blue Seal Energy Group, Lloyd Robertson, truly understands the marketplace, client’s needs, the business drivers and how to be successful. In this exclusive interaction with Peter Uzoho, Robertson shares his experiences, the company’s investment in Nigeria as well as future plans. Excerpts:
Blue Seal Energy Group is into the manufacturing of chemical products that serve the oil and gas and other industrial sectors. How has the experience been working in Nigeria and leading this company as the Chief Operating Officer?
Well, it’s interesting because I have substantial previous experience in Nigeria. This is not my first experience. My first experience in Nigeria was as district manager in Warri in 1988 for Baker Hughes. And then I left, because Baker Hughes was going through a merger and acquisition, and they hadn’t decided how they were going to structure the the company. I left and went to Papua New Guinea for two years, seconded to Chevron, and then they asked me to come back in 1990 as the technical manager for all of Nigeria, and I was in Port Harcourt for four years.
Then I was transferred to other places around the world. I went from Nigeria to Tunisia, Tunisia to Indonesia, from Indonesia to Aberdeen, Scotland, from Aberdeen, Scotland to Luanda, Angola as sub-sahara region manager. And they transferred the regional office from Luanda to Lagos. And I came back to Lagos as managing director of Baker Hughes in Nigeria, as well as holding the responsibility for Sub-Saharan region drilling fluids manager. So I am quite comfortable with the Nigerian environment. I know it well.
Blue Seal opened its chemical manufacturing plant sometime last year. What is the business like now with the company since the commissioning of the facility?
Well, we are just getting started, really. I mean, we’ve had some delays in production due to some conflicts within the organization. We’re about to get to the point where we will be doing full production in the very near future. Market dynamics have been a major driver in our slow start. But we look forward to establish our foundation and grow. And I think our growth will be very quickly.
Blue Seal’s plant in Ibeju-Lekki has the capacity of about 35 million metric tonnes per annum. Have you now ramped up to 100 per cent production capacity, as we speak?
No, not yet. As I said, we’re starting slowly. The capacity of the plant is 1.7 million liters per day. So we can do substantially more than what you have just stated. However, And one thing I need to say going forward is that we are not competing with the people who are the end users. We want to be collaborators with the end users who need those products. The service companies that have long-term relationships with the operators in Nigeria, we want to support them. We want to be there OEM reguonal manufacturer. So we are reaching out to those companies that need our support. And trying to break through to make them more efficient economically. And to give them the inventory they need in a just-in-time manner, rather than having to order and wait for it to ship and be cleared and to be in their warehouse.
Because I’ve managed investors in Nigeria, I know that when I first came to Nigeria, that from the time you ordered product to the time it was in your warehouse, it could take as long as five to six months. We were able to improve that efficiency slightly, but we never got to a point where it was over four turns of inventory in a year. With the capabilities of manufacturing in Nigeria, you can bring that inventory turns to a matter of nine or 10 turns of inventory in a year on the products that we make. Our plans are to expand our manufacturing capability to a point where we can provide more of the products they need, to substantially help their return on net capital employed and, then profitability. All of our products are made to international quality standards, according to API, according to ISO. So when we bring our products to the marketplace, we stand behind our products from a quality standard, making sure that they are not losing anything if they buy from us rather than importing.
Who are your major clients or customers in Nigeria, across the oil and gas, and industrial sectors?
Our primary targets as clients are the drilling fluids companies, the production chemistry companies, the turnkey operators who provide the services to the major operators.
Dangote Petroleum Refinery and Fertiliser are there in Ibeju-Lekki as your neighbours and I know they too require some chemical supplies to work. Are you into any contracts with them? Are you supplying them right now?
Yes, Dangote has been a client of Blue Seal Energy group for many years before we even built the plant. Before we built a plant, we had a group called Blue Seal Energy Services. And they provided products and services to Dangote long before we even built the plant. This goes back over 10 or 15 years.
What are the different kinds of chemical products that Blue Seal manufactures and provides?
We manufacture drilling fluids products, emulsifiers, rheology modifiers, Welding agents. And we do completion fluids, chemistry such as corrosion inhibitors and scale inhibitors and packer fluid products. And then we do production chemistry, which is demulsifiers, scale inhibitors, H2S inhibitors, iron scavengers, H2S scavengers. I don’t have it in front of me, but mostly production chemistry, oxygen scavengers. And then we also do water treatment in the industrial sector, for corrosion inhibition and passivation of water systems and cooling systems, industrial water management from refining, those kind of things, demulsifiers. So those are the three primary areas, drilling, completions, production, and industrial. Those four are our major areas of manufacturing.
Blue Seal Energy Group could be regarded as one of the companies that are bringing foreign direct investment in Nigeria. So today, how much of investment would you say the company has put in in Nigeria?
Well, our current investment is the plant that is in Ibeju-Lekki. But we have plans for developing an additional two plants in Nigeria. And then a total of 10 to 15 plants across Sub-Sahara Africa in the next 10 to 15 years. The actual investment in Nigeria is kind of a moving target at the moment. I’m not going to publicly disclose all our investments at this point in time. But we paid cash for the plant in Lekki. So it’s substantial.
What informed the company’s decision to invest and set up a manufacturing plant in Nigeria instead of taking the easy way of just importing chemical products into Nigeria?
Well, you have to realise that the owner of the company is Nigerian, and he cares very much about the Nigerian people. As such, he wants to have a positive impact on the economy of Nigeria through jobs, through training of personnel, internships from the universities, improving the playing field from a cost perspective. Improving the cost to the indigenous operators, reduce their overhead, reduce their operational cost, help them be more efficient. It’s a major economic umbrella where we try to help general economics of Nigeria and the people who live here.
Is supporting Nigerian local content drive also part of it?
Very much so. The local content is one of our most important aspects that gives us credibility in the marketplace. You know, most of the service companies and the operators are being pressured by the local content governing body to use as much Nigerian content as possible. So we bring that aspect to the chemical business in Nigeria. I am the only expat involved in this business at the moment. And everyone else involved in our company is Nigerian.
So you’re saying that almost 100 per cent of your workforce are Nigerians?
Absolutely.
How much local content level has the company achieved so far?
That varies, but I would say we’re probably 60 per cent Nigerian content, if not more. We import some of our intermediates and reagents from international sources and try as much as possible to use chemistry that’s available in Nigeria to help us with our manufacturing process.
Are you getting enough support and encouragement from the Nigerian Content Development and Monitoring Board (NCDMB), which regulates and supervises manufacturing and service companies in Nigeria’s oil and gas sector?
Absolutely. Last year at the Practical Nigerian Content Seminar in Yenagoa, Blue Seal was showcased as an example of how to do it the right way. And Dr. Edeni, the owner of the company spoke at that conference. Yes, we have gotten a lot of support from NCDMB.
What particularly differentiates Blue Seal’s chemical products from other producers in Nigeria or elsewhere?
Well, as I said before, we make the products to international quality standards. It provides a reduced cost of goods to the people who are operating here, giving them the ability to drive down cost for the operators. That in itself is a lot.
As the Chief Operating Officer of Blue Seal, you have staff members and material resources to manage. What kind of leadership and managerial skill do you bring to ensure that these are managed in a way that enhances productivity for the company?
Well, in September, I’ll have 48 years in the industry. I’ve lived and worked on six continents in multicultural environments, managing multicultural employees. I have over 10 years in West Africa and experience. I understand the marketplace. I understand the client’s needs. And I understand the business drivers here and how to be successful. I’ve been successful every time I’ve been here, so I don’t intend for this to be different.
How would you compare Nigeria’s business environment with other countries that you have worked in in terms of enabling policies, enabling regulations, and all that?
I would say it this way. This will be my fourth time to work in Nigeria. As such, there are business challenges just like there are everywhere. The challenges vary from country to country. But it doesn’t vary that much. You know, there are certain levels of bureaucracy and everything that you do. Depending on where you are, it can be worse or it can be better. I mean, I’ve worked in places where the bureaucracy is much worse than Nigeria. I’ve worked in places where it’s a little bit easier, but you don’t have as many opportunities as you have in Nigeria. In Nigeria, the opportunities outweigh the problems with bureaucracy in so many ways.
Are there things you find not so good about Nigeria’s business environment in terms of chemical manufacturing and allied services? And how can such be addressed?
You know, the importation process can be cumbersome. Sometimes there are surprises that can affect your landed cost. But at the same time, that can be anywhere. It’s not that much different than anywhere else in the world. Anytime you work in an international environment, unless you’re working in Europe or the US, there’s not much variability in the importation process. It can be cumbersome anywhere you are. Some are worse, some are better, some are the same.
But as I said a while ago, one of the things that differentiates Nigeria are the opportunities, because there is a need. There’s need for improved efficiency in the supply chain. There’s need for the improvement in product quality. You know, there are several ways we can improve the operating environment for our clients. It’s just the matter of having the opportunity to explain that to them and prove it to them.