Linh Austin, Senior Vice President, Middle East and North Africa, McDermott spoke to Pipeline Magazine’s Julian Walker about focusing on Egypt as one of the company’s strategic pillars for growth plans in the region
McDermott feels that the time is right for it to enter the Egyptian market again now that the merger with CB&I, which was successfully completed last year, allows it to offer services across the whole value chain.
As Austin explained: “After the merger with CB&I we refreshed our strategy and Egypt made more sense after the merger than ever before. We have now decided to up our presence in the country. If you look at the new offering from McDermott we can provide services across the board. Everything is in play for us in Egypt.”
He added: “Egypt is a very important market for McDermott. If you think about the big projects of work that are currently going on both in the onshore and offshore space, Egypt for us is extremely important. It is a market that both legacy companies really didn’t have a lot of focus on, whether it was offshore for McDermott or onshore for CB&I.”
For Austin one of the main appealing factors of the Egyptian market is that it is only going to get bigger.
“As the country continues to try and push out the extension of Zohr and other fields, like West Delta which continues to grow, it makes the offshore market really appealing. We also have good relationships with most of the key IOCs who are in the Egypt today.”
He added: “We also think the rest of North Africa is important, as well as Lebanon. This could all be an important market but today Egypt is our focus as it has a lot of work going on now. The other markets are starting to emerge in terms of where we can participate.”
McDermott sees a lot of potential in the Egyptian market “The benefit of Egypt is that it is a very capable market with a lot of internal capabilities and expertise on the ground. There is a lot of infrastructure that can support the onshore and offshore market. We think we can bring our technology and some of our differential around execution that we can bring to bear to the Egyptian market,” said Austin.
He added: “I think for us in Egypt in the onshore space, our offering will be technology led, whether it is around ethylene or heavy crude hydroprocessing where we have a leading technology position. In terms of execution we would likely partner with someone locally to do the execution but we would do the engineering and technology. In terms of offshore, we have an impressive deepwater offshore fleet with our Amazon ultra-deepwater J-Lay vessel, a leading asset that makes us quite competitive in that market to do offshore installation work.”
Austin also feels that the tanks business is something that McDermott would pursue in Egypt because there is a lot of work for the tank business in the country, whether it is from new builds to maintenance and refurbishment.
Historically both legacy companies had a big presence in Egypt. McDermott had its first Middle East yard in Egypt. “Egypt is not necessarily an easy market but it is a market we know is important. Egypt is one of our strategic pillars in terms of where we see real growth,” noted Austin.
He added: “One of our main hurdles in Egypt is that there are strong entrenched competitors which can make it difficult to break into the market. We need to be aware of the challenges around regulations and what process we need to follow. There are some logistics challenges as well.”
“It is too early for us to make any big announcements but we are looking at entering the market and making sure we have a good understanding of the landscape. We need to find out on the ground what is the right play for us. We are prepared to invest in Egypt. We have a small representative office in the country but we will be looking to get the right people on the ground,” Austin said.
McDermott sees the EGYPS event as a great opportunity to get a better understanding of the Egyptian market. “We were at EGYPS last year. Our stand this year at EGYPS will be bigger and will have a focus on the entire McDermott suite of offering from onshore to offshore and a real focus on technology. Part of coming to the EGYPS event is that we are going to have a larger presence at the show and visit some of our clients. We want to look at how we can make a move into the country.”