Conservative estimates suggest that in the wake of oil prices crashing in late 2014, the Malaysian oil and gas services and equipment (OGSE) sector contracted by at least 11%. Analysis of overall financials for the OGSE sector by the Malaysian Petroleum Resource Corp, an agency under the Prime Minister’s Department, reveal that revenue for 2015 fell by 11%, while profits contracted by a severe 52.3%. Including companies such as MISC, Sapura Energy, Dialog, Scomi, Bumi Armada, the numbers for 2016 are not available yet, but a glance over the financial reports released for the bigger players indicate that while sector revenue will probably be down for the year, profits maybe be up, after aggressive cost-cutting that included a tide of retrenchments.
So what is in store in 2017 and beyond?
If we go by the health of Petroliam Nasional Berhad, better known as Petronas, the word seems to be “cautiously optimistic”. The guardian and bellwether of Malaysia’s Oil & Gas sector, Petronas is one of the few major integrated state oil companies that is holding up fairly well during the current on-going oil crises. Petrobras is engulfed in debt, as is PDVSA, while Pertamina appears to be struggling with corruption and clarity of its long term investment direction while select Russian entities battle being used as political tools. Full year 2016 revenue for Petronas fell by 17.3% from lower sales coupled with weak crude prices but profit was up by a whopping 28% to RM16.95 billion (US$3.82 billion), just slightly behind Shell’s own profit for 2016. For 2017, Petronas projects better times ahead, promising no more staff redundancies and bolstering defences by pegging its 2017 capex expenditure at US$45/b, while it prepares to focus on natural gas - both at home in Sarawak and Sabah, and abroad in its Canadian LNG export project, and the recent go-ahead given to its massive US$27 billion RAPID refinery and petrochemicals project.
However if oil prices fall any further or just lingers within the US$50-55/b range, the so called recovery being experienced now, may just stagnate or not be strong enough to re-boot the industry to its previous glorious days and create the jobs badly needed for Malaysia. The threat of market oversupply is still there as US shale oil continues to grow unabatedly. The reality is low oil prices for (much) longer. The future prosperity of Petronas would depend on how much it can increase its productivity and lower production costs. Petronas has moved very decisively and embarked on intensifying its internal cost competitiveness through better collaboration amongst other upstream operators in Malaysia through the CORAL 2.0 project, and is beginning to see lower cost scenarios for its well engineering programs already. On the new technology front, Petronas is collaborating with MIT Innovation Sdn Bhd (MIT) to promote a smart and efficient technology that significantly lowers drilling costs. All moves in the right direction.
The weak link to Petronas’s current cost strategy and competitiveness globally could however be its very own local supply chain. As Petronas tries to prosper in the current climate, the industry that supports it needs to be similarly positioned to do the same - efficient and cost competitive. With the exception of a few large players like MISC, Sapura Energy and Dialog that have the width and breadth to survive challenging conditions like in 2015 and 2016, further down the supply chain, the smaller players many of whom are just agents or third-party equipment representatives do not necessarily own technology, are extremely vulnerable to volatility. (Debt is a particularly pressing concern in this end of spectrum especially in the offshore segment, with players like UMW Oil & Gas, Dayang Entreprise and Perisai Petroleum Teknologi facing recent problems in renegotiating their debt incurred during the good times. Those who can’t keep afloat will be targets for acquisition or forced mergers, like the recent merger between UMW Oil and Gas, Icon Offshore and Orkim.) In a recent business seminar, Malaysia Petroleum Resources Corp (MPRC) senior vice-president Syed Azlan Syed Ibrahim said that “although we foresee 2017 will not be far off than 2016, I do not think it will be worse. This is the opportunity for players to make the hard decision to restructure or reform. That time is now. They (local oil & gas supply chain companies) need to do it now so that when the market goes back up they will be ready” Calls for consolidation amongst local companies, especially in the upstream segment will help strengthen the industry, allowing for greater combination of resources for increased technological innovation and value creation that is urgently needed for Petronas to be competitive locally and overseas. Less reliance on foreign US dollar denominated technology or service providers will help Petronas achieve its low cost operations goal.
As Petronas announces fewer projects in 2017 compared to pre-2014 levels, local service player will need to compete and work outside Malaysia for revenue and business growth. It will be useful here for the local oil industry to emulate the success in the Norway. As we have seen and witnessed the growth of Statoil, Norway's national oil company, as a global player in the oil industry, it is backed-up with a group of highly matured and capable technology and services providers. The grouping is now known as Norwegian Energy Partners or NORWEP in short. NORWEP looks beyond the shores of Norway for new business, and compete for projects globally. It independently (without Statoil’s direct assistance) builds relations with other governments and strategically partners with other state controlled oil companies. To date, it has achieved a respectable track record in developing new technologies in enhanced oil recovery methods as well as strong health & safety in its operations.
Looking into the future of energy, the argument for diversification into how energy will be generated, distributed and utilised also seems compelling. Shell is convinced that the next phase of fossil fuel energy will belong to gas. Petronas is well positioned in the gas business, as it continues to be within the top 3 exporters of LNG globally with strong gas reserves and infrastructure locally as well as internationally, especially in Canada. However the argument for energy diversification goes further from fossil fuels. During the 2017 CERAWeek, the fossil fuel big annual conference, most speakers proclaim a long and prosperous future for their industry. But companies and countries that rely on oil and gas income are recognizing that renewable forms of electricity are gaining traction as prices come down and their popularity rises. Oil executives are adapting their portfolios to add cleaner fuels and moderating their rhetoric on climate change. "A low-carbon future will reshape the energy space. Some see this as a threat to our industry, but we should rather look for and act on the opportunities it offers," said Eldar Sætre, CEO of Norway's Statoil. "We have to respond more forcefully to the challenge of climate change." The oil and gas industry has clearly recognized that its monopoly on transportation fuels is weakening for the first time since automobiles replaced horse-drawn carriages. To be fair, Petronas has embarked on feasibility projects in renewable energy space with the commissioning of a Solar Independent Power Plant (IPP) project in Gebeng in Kuantan. The Solar IPP project came on-stream in 2013 has a capacity of 10 megawatt peak (MWp). However this venture seems to be dwarfed by recent announcements especially from the gulf operators. Saudi Aramco is planning to produce 10 gigawatts of power from renewable energy sources including solar, wind and nuclear by 2023 and transform Aramco into a diversified energy company. The kingdom also plans to develop a renewable energy research and manufacturing industry as part of an economic transformation plan announced by Deputy Crown Prince Mohammed bin Salman. Shell, Europe’s largest oil company, has also recently established a separate division, called New Energies, to invest in renewable and low-carbon power. The new division brings together its existing hydrogen, biofuels and electrical activities. Should Petronas make bigger investment in-roads into the renewable energy sector now rather than later? Shell is projecting that it will not make any money from renewable investments at least for another 10 years. Getting ahead in the game will certainly help any new player. Noting of course that there are other players in Malaysia in the renewable energy scene, for example Tenaga Nasional Berhad or TNB is growing its portfolio in solar energy aggressively.
In conclusion, Petronas seems to be generally on the right path in evolving its energy mix and growth strategy in the energy sector. Being a state controlled company, it will require undivided political support to transform its local supply chain and embark on a commercially driven low cost structure. If the large dividends that Petronas pays annually to Government are to continue, it should be an incentive for the Government for more action to reform the industry’s supply and support base.
Petronas being a large and complex business, reforms typically take time. However due to the prolonged nature of the low oil price climate, the pace of change impacting the industry seems to be moving faster compared to previous downturns. As the oil business is global and fairly transparent in terms of revenue and cost structure, Petronas is unfortunately unable to dictate it’s not own timeline in reforming itself and the industry that supports it. “Faster the better..lah” seems to come to mind. Easier said than done.
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Two months ago, the crude oil market was abuzz with chatter that US$100/b oil was imminent. Fuelled by worries over the impact of American sanctions on Iranian crude exports, industry powerhouses from Glencore to JP Morgan to BP predicted that Brent would hit US$90/b by Christmas, and breach the three digit mark in Q12019. With just over a month to Christmas, Brent is now trading at US$65/b and WTI maintaining its steady discount at US$55/b. How did the market get it so wrong?
The main lynchpin is supply. Just as the sanctions went into effect on November 3, the USA issued surprise waivers to 8 key importers of Iranian crude, including China, India and South Korea. This had been bandied about in the lead up to November 3, with South Korea even eschewing all Iranian crude in September and India cutting down dramatically to qualify. The scope of the waivers was larger than expected, despite American rhetoric that the sanctions would be ‘tougher’ than Obama-era measures. Ostensibly, the waivers were issued due to the market being ‘fragile’, but also it also acknowledges the reality that it will be impossible to remove all Iranian crude trade without causing a supply crunch. So instead of reducing Iran’s exports ‘to zero’, the White House seems to have settled on reducing it to 1 mmb/d or so.
At the same time, President Trump’s Twitter demands that OPEC increase its supply was heeded. Saudi Arabia claimed that OPEC was in a ‘pump as much as we can’ mode, with the Kingdom’s crude exports rising to record highs, along with that other large producer Russia. With increased supply from OPEC more than offsetting losses in Iran, the market swung from fears of a supply crunch to oversupply. On November 13, Brent dropped by almost US$5/b as market dynamics changed course; it wasn’t just supply growing, but also demand retreating, as warned by the EIA and IEA. OPEC also commented that it was seeing ‘declining demand for its crude’, revising its demand forecast downwards for the fourth month in a row – news that spooked traders in the market, especially given that China’s overall economic growth is also slowing down.
So crude oil benchmarks are now trading at nearly 20% lower than they were a month ago. That’s officially a bear market. What happens next?
Probably to the chagrin of Donald Trump – although the issue is less vital now that American midterm elections are over – Saudi Arabia is looking to make a U-turn, proposing an output cut of some 1mmb/d ahead of the OPEC meeting in Vienna in two weeks. Other allies within the OPEC+ circle are less keen on changing course, with Russia stating that producers should look to avoid knee jerk reactions to momentary price signals. That said, Vladimir Putin has also stated that oil at ‘US$70/b suits us completely’, a sentiment echoed across OPEC. So instead of taming prices, OPEC now has the onerous task to propping them up. But it’ll be easier said than done; the current glut in the crude market is for light, sweet grades, not the heavier, sourer crudes produced by OPEC.
Will it happen? Yes, it will. Producers have gotten used to US$70/b oil and with signs showing that Brent could fall as low as US$60/b in the next few weeks, they will be eager to shore things up. The slate of new upstream projects approved in the second half of 2018 require relatively strong crude prices to be economic. US$80/b oil might be too high, US$60/b oil might be too low, but US$70/b oil seems just right. And now it is up to OPEC+ to see if they can convince the market to return to that point.
Recent Brent Prices:
|A Project Management Professional with Management responsibilities covering the life cycle of a project from initial estimates and proposals to design management, project planning, procurement, construction, shutdowns, commissioning & handover.|
Key areas of responsibilities& Achievements include:
Experience of Team management of over 150 Engineers and Designers
Technical evaluations for Bidding efforts and attend bid clarification meetings with Client as required.
Prepare & Issue technical summary & technical risks anticipated to management & Proposal Manager.
Interface coordination with other JV Partners, EPC Contractors, PMC & Client.
Organize the work for the Project team in the various phases of a Project including various procedures Quality & Execution Plan.
Organize & Attend Kick off meetings with client, partners, sub-contractors, vendors etc.
Expertise in coordinating complex engineering projects across disciplines involving various stake holders
Conduct Design Reviews, Risk Assessment, Value engineering, HAZOP/ P&ID Review/ Plot Plan Review/SIL studies/ Model Reviews, internal & externally with Client.
Ensure projects adhere to Quality & HSE System requirements
Prepare & issue related contractual & Technical letters & Queries.
Expedite with vendors, subcontractors & Client for various engineering & procurement activities.
Worked on Projects with Shell DEP’s, HFE, American, Singapore & Vietnamese Engineering Standards
|Brief Responsibilities |
|Single Point of Contact for all engineering matters, clarifications, queries & client communication on the Project|
Manage a multidiscipline engineering & design team to deliver scope of work safely & within quality/cost/schedule
Assisting the Project Management Team in all project management activities assigned.
Co-ordination with the disciplines and resources of the company in furtherance of the contract
Achieve the project’s stated objectives
Implement Lessons learned and performance survey.
Champion the consistent use of delivery tools/processes which ensure that all parties have an agreed understanding of the project and their part within it
Analyze pre-contract correspondence vis-a-vis contract and resolve grey areas, if any, in the contract.
Take Lead in preparing the Project Execution Plan, Engineering Execution, Project Quality Plan covering objectives, priorities, directives to be followed and constraints to be imposed on the design & procurement, erection and commissioning of the plant.
Coordinate and prepare Project scope deliverables including DOR, strategies for critical Equipment’s & LL Items.
Coordinate for ensure all relevant team members are well versed with scope, applicable codes & standards and client requirements.
Coordinates & be the focal point for all engineering related inputs & outputs including during field engineering.
Resolve grey areas in basic design parameters and design standards with the client/PMC and issue contract design data.
Prepare Project Procedures, Quality & HSE plans & Issue the Engineering programme / Schedule.
Agree Construction Co-ordination Procedure with the Resident Construction Manager.
Study the control estimates. Follow up corrective action where necessary as directed by the Project Manager.
Prepare the periodical progress reports to client for Clients review.
Prepare Project Closure Report & Engineering Closure Report.
Monitor & control RFI, DCN, Variation notices including engineering change orders
Coordinate for Model Reviews, HAZOP, SIL, P&ID Review etc.
Identify Areas of Concerns with respect to progress and/or quality implementation of corrective actions as required.
|Experience||Company: Abu Dhabi Construction Company|
Dept. Project Management
Duration Oct 2016 till date
Company: SK Engineering & Construction
Duration April 2010 till May 2016
Designation Lead Engineer (Projects)
Company Air Liquide Global E&C Solutions ( Formerly Lurgi Gmbh)
Duration Sep 2008 till Mar 2010
Designation Senior Engineer
Company Reliance Industries Ltd ( Formerly REAL) – EPC Division
Duration Jan 2007 till Sep 2008
Company Hindustan Construction Company Ltd. (HCC), Mumbai.
Duration Jul 2004 till Jan 2007
Designation Senior Engineer
Company Bhoomi Engg (P) Ltd, Ahmedabad
Duration Jan 2001 till Jun 2002
Designation Site Engineer
|Projects handled: ||ADGAS IS1 Project-LNG Train 1,2 & Utilities maintenance Project (14 Million USD)|
ADGAS IS2 Project- LNG Train 3 & Utilities maintenance Project (18 Million USD)
KNPC- CFP Project, Kuwait (8Billion USD)
Detailed Engineering for Brown Field Units:, Isomerization flare, CCR, Interconnections, Offsites, Steam and Condensate, FCCU, FUP Cooling Tower, including Interface Coordination
FEED verification & detailed engineering for Green Field Units, SRU I & II,
Nghi Son Refinery and Petrochemical (NSRP) Project, Vietnam (12 Billion USD).
FEED Verification & Detailed Engineering Greenfield CDU, KOHDS, GOHDS, SRU
Jurong Aromatics Complex Project, Singapore (1.8 Billion USD)
Detailed Engineering for Greenfield Condensate 1 & 2.
ISPRL Padur (UG) Crude Storage Facility
Storage Units MUA & MUB
SLM FEED Project , Louisiana , USA
CHL (Tahrir Petrochemical Project) FEED Project, Egypt
Detailed Engineering for Sulphur Recovery Unit, OHCU, Haldia (EPCM & , IOCL & for Shutdown & Commissioning
FEED Package for Iran Liquefied Natural Gas Company, LNG Project at India
Detailed Engineering Package, Gas Treating Units, Iran LNG Company at India
Jamnagar Export Refinery Project (JERP)- EPC
Engineering & construction works under Marine Construction Department, including Trestle fabrication, testing, Pile cap modification, Trestle launching, piping works on trestle, cold & hot insulations, Passive Fireproofing, water proofing, marine erection of trestle, onshore piping works till zero point to LFP, Fire proof painting works on jetty trestle, Jetty modification works, Insulation works of LPG lines etc.
One 24” LSWR line, one 24”diesel line & one18” Alkalyte line each 11 KM.
Pipe Racks, Tankages & Chiller Plant
3 Major Shutdowns including Onshore & Offshore Golden joint
Reliance Ports & Terminals Ltd, Revamp Project
Three new SPMs namely SPM 3, SPM 4 and SPM 5 and the associated following submarine pipelines have been planned to be installed as part of JERP project under this contract.
Boat Landing Structure Fabrication & installation
2 x 48” diameter pipelines to import crude via SPM 3
2 x 30” diameter product pipelines to export via SPM 4
2 x 30” diameter product pipelines to export via SPM 5
2 Nos Cryogenic Chiller plant
7 lines from 6” potable water to 30 “Diesel lines through new trestles.
2 Nos 1.6 m dia Sea Water system
3 Shutdowns excluding loading arms revamps & MTF hot tappings.
Sea Water Intake Channel revamp including dredging, widening, filtration systems.
Kudankulam Nuclear Power Plant, Package C3 (Onshore) & C6 (offshore)
|Proposals handled: ||Proposal Project Engineer for ISPRL, Mangalore (AG) (Process & Utility facilities)|
Proposal Project Engineer for ISPRL, Padur (AG) (Process & Utility facilities)
Proposal Project Engineer for SOHAR Refinery Expansion Project, ORPIC, Oman
Proposal Project Engineer for RAPID Package 4 , Malaysia
Proposal for HPCL-BPCL Hydrogen Project (BOO Basis)
Proposal for FEED Package for Iran Liquefied Natural Gas Company, LNG Project.
Proposal for Detailed Engineering Package, Gas Treating Units, Iran LNG Company
Proposal for AME- DME , Indonasia
Proposal for Resid Up-gradation Project, Chennai Petroleum Corporation Ltd , IOCL, Chennai
|Computer Proficiency||Tools – MS Office, AutoCAD 2014, SAP MM module, Pro-file, Documentum|
Planning Tools - Primavera Project Planner ( Ver 7, 6.2 ), Microsoft Project, SAP
Engineering Tools - SPR (Intergraph), Navis Freedom, Microstation
|Language Proficiency||English, Hindi, Malayalam, Gujarati, Tamil., Marathi, Korean (Beginners)|
|Certifications||PMP® Under Progress. Expected by Dec 2018|
|Education|| 2002–2004 M. Tech in Construction & Project Management, CEPT, Ahmedabad |
1997–2001 B.E. (Civil) from D.N.Patel COE. Shahada, Maharashtra
Date of Birth …………………Aug 18th 1978
Place of Birth …………………Kerala, India
Passport No……………………L8490259 valid till 30.04.2024
Linked In : https://in.linkedin.com/in/sandeep-nair-17a79821
UAE driving License…………..2443931 valid till 2020
Oil and gas sector is one of the most lucrative sectors for job seekers from industries all over the world. It offers great salaries and benefits packages and an opportunity to travel and work overseas. Due to its high demand, scammers are preying on the vulnerable oil and gas workers. To ensure you don’t fall prey to their mischievous tactics, we would recommend reading our guideline below:
How does scamming occur?
The scammer poses as an employer or recruiter of an oil and gas company or he may claim to be an employee or recruiter for a job consultancy firm catering to the oil and gas industry. They offer irresistible employment opportunities and often demand money in advance to conduct further processes. Money is often demanded on the pretext of work visas, travel expenses, background or credit checks that the job requires.
What do scammers want from you?
It is important to understand what the scammer's agenda is so that it helps you shield yourself from getting conned:
To extract money: On the pretext of getting you a job in the energy sector employing any of the tactics mentioned above
For identity theft: scammers look for valid identity of people and ask for confidential personal details including bank details to commit fraud through your name or to withdraw money from your account.
Whatever be their modus operandi, their goal is to either separate you from your cash or accomplish an identity theft. The bigger problem is, the scammers are getting better at their game and coming up with innovative ideas to lure innocent job seekers. In oil and gas industry, the scammers are targeting the job seekers from overseas, immigrants or contractors as they feel it is easier to attract them on the pretext of work permits, high salaries, paid travel, better lifestyle in the first world countries.
How to spot a job scam and keep yourself secure?
There is always a difference between real and fake, all you need to do is be watchful to notice the underlying discrepancies. There is a pattern that scammers usually follows, which is discussed below. Make sure you watch out for these red flags when you receive any job offer next time:
Free email provider - No legitimate hiring agency or company will use the services of free email provider like Gmail, Hotmail, or Yahoo. So, if you are receiving an email or have been requested to share your details on emails that use free email services, then be extremely cautious. The scammers try to trick the job seekers by using an email address that looks authentic for instance: [email protected]. It is important to notice here that the ‘xyz’ part of the email ID is usually a gmail, yahoo, etc. which is a free email address. A legitimate job provider would never use.
Fake or new company name - If company name or oil and gas recruitment agency name is mentioned along with the free email id, then do a quick search on the company. Verify its existence and contact them via official email address and contact numbers mentioned on the website. Check their social media presence too. If the website and social media page look new while the company claims to be in business for a substantial amount of time, know for sure that there is something fishy.
Bad grammar and confusing job details - The scammers usually do not pay much attention to structure the mail. You can spot grammatical errors and even the job descriptions are not explained well or is completely different than your skillset and experience. Any authentic mail from a company or oil and gas recruitment agency will ensure an error-free, concise, and clear communication
Fee to conduct a job interview - No legitimate oil and gas company or recruitment agency will ever ask for money to conduct a job interview or to apply to job positions. If the mail says, the money will be refunded once you appear for a job interview, then please do not trust such claims as it is always bogus.
Asking for confidential personal information - Anyone asking for information that you will never put on CV, is a warning sign. It includes your bank details, passport copy, identity cards, your current residential details and so on. No genuine company will ever ask for such details before you sign the offer letter. If by chance, you have shared your bank details or another confidential detail to the scammer, contact your bank and email service provider and register a complaint against it.
Unknown source - There are countries who have strict spam rules and until you subscribe or give consent to the company, they cannot send you emails. So, if you receive an email from a company you haven’t contacted or have not applied for jobs, then be cautious it might be a scam.
The principle on which scammers operate is “Too good to be true”. Don’t entertain any job offer that offers a position, you are not qualified for or offers a salary which is unrealistically high. In the oil and gas sector, be careful not to reveal your passport/work visa details to the scammer. Remember, if you find anything which is way beyond the realistic expectations, then trust your instincts and drop the offer and do not respond.
See our infographic below for a quick summarized glance -
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