DMS Interview - Dr.Fadi G. Abbosh President and Regional General Manager of VECO Corp. for the Middle East & North Africa (MENA) Region ,based in Abu-Dhabi,UAE. Where were you born, brought up and educated? I was very fortunate that at the last training session I joined the Science Research Council at the Daresbury Nuclear Physics laboratory and then remained on the R & D staff. They had just completed designs for the construction of the laboratory complex and the Electron Synchrotron it was to house . This was a very sophisticated scientific machine made up of a large number of huge electromagnets and associated supply and control systems. Of course almost all systems associated with this machine were largely custom designed and fabricated and utilized means which were at the limit of knowledge available at the time, This wetted my appetite for research and for wanting to know more about engineering and the world around us . Construction and Commissioning was completed some 3 years later and the project was handed over to an international team of physicists and scientists who then did their nuclear physics experiments. Our systems development group ended up being just a service to them. So, I looked around and eventually went to Glasgow University as a research associate and did my PhD .While I was there I got on to the staff as a lecturer and completed my PhD in 1974. At that point in time, I was thinking of coming back to the Middle East & went back to Lebanon to see the possibilities there. I could feel the situation wasn’t right. This was before the start of the civil war. In fact it happened 6 months later. I was lucky I didn’t make that decision to move over there with my young family and instead accepted the offer of a lectureship at Manchester University’s Electrical Engineering department. In addition to teaching and research duties,the Electrical Engineering Departments of both Universities were heavily involved in a fair bit of industrial research and support to industry .This coincided with one of my major interests and research activities, which was computer automation of process plants and power generating plants(the subject of my PhD thesis) . That’s really how I initially got into the power plant business and in 1978 I joined a German company (Incon Anlagentechnik ) who ,with their mother company, had just been awarded a US$770 million LSTK contract for a combined Power & Desalination plant in Jeddah, Saudi Arabia . Known as Jeddah 4 ,this was a 600 MW power plant with a 50 million gallons per day desalination plant. At that time, the largest in the world and one of the first to be computer automated. This German company was in fact the wholly owned subsidiary of Sogex International. Many who were in the construction business in the early to mid 80’s would know Sogex ,which at that time became the largest and most capable Arab engineering construction company in the Middle east. They possessed the entire range of activities from engineering, design through construction, even research & development and manufacturing (e.g. of Reverse Osmosis membranes etc.), so really it was well ahead of many of even some of the largest Arab construction companies existing today. At its peak, in the early 80s , it had already achieved a turnover of 1.2 billion dollars. Incon Anlagentechnik , responsible for all industrial projects of Sogex , and another Sogex subsidiary, Envirogenics Systems Co. Ltd., of El Monte in Los Angeles, California with a history of over a 100 years , were one of the world’s leaders in water treatment & desalination technology . I initially lead the I & C systems and automation group for the J4 project at Incon, then promoted to head the whole electrical and instrumentation/ control department and 2 years later was made Managing Director of that company. Also, though Sogex were involved in other works which were civil in nature such as airports, sea ports, major housing and military complexes etc. , the group were awarded further power plants, desalination plants and other smaller industrial plants. Obviously that meant a lot of involvement with international companies. For example it was Envirogenics who licensed Mitsui for desalination technology and in fact we later formed a joint venture with Mitsui for the Jeddah 4 Project. They fabricated the MSF evaporators for the desalination plant to our design. In the mid 80’s Sogex began to have financial
problems particularly in Saudi Arabia. They started closing some
of the subsidiary companies including Incon,, so I went to California
as President of Envirogenics . I stayed there till 1987/88 when
it looked like the whole group was going to collapse, which it eventually
did. I got out before that and went back to Germany, which since
1978 had become my home base. I started my own consultancy business
and then an old colleague who owned the leading architectural/engineering
practice, called Omrania Architects and Engineers (eventually O&A
Associates ), in Saudi Arabia, with a subsidiary in London, UK,
asked for my help to manage and grow the company. I joined as Managing
Director and we eventually grew this company to over 220 people
and were very successful in landing and executing many landmark
architectural as well as innovative industrial projects in Saudi
Arabia and beyond . Prince Waleed Bin Talal eventually became interested
in the company and joined as majority shareholder .We ended up designing
and project managing the construction of many of his projects. Notable
amongst these was the Kingdom Center in Riyadh, which at 300 meters
was the tallest building in Saudi Arabia and one of the tallest
worldwide. What was it like working with Prince Waleed
bin Talal? When did you actually join Veco? Was Veco new to the region at that time? Yes, they were new to the region except for one project , a clean up programme for the oil spills from the first Gulf war in Kuwait.But this is not how I got to know Veco. O&A was looking to become a GES contractor for Aramco and we were looking around for a capable and experienced American based engineering company in the oil and gas sector that was not already present in Saudi Arabia to partner with. Our choice was Veco. Were the American companies very successful at that time? Yes, they were very successful and very well entrenched with Aramco. There was definitely a preference for them by Aramco. It was around the same time that Veco had got the oil spill job (with another partner in Saudi Arabia). That’s how I came to know Veco in the first place and eventually joined them in October 1999. What are Veco’s main areas of expertise? I am sure you are familiar with “Engineering News Record”. They do a number of surveys every year of various categories such as the “Top 500 Engineering Companies” . It is like the” Fortune 500” of the engineering and construction industry. In the 2002 survey we were classified as number 31 overall in the top 500 engineering companies. Within the top 500 they also do subcategories. Like in the top 25 for “Petroleum” we were number 9. In the top 15 for “Pipelines” we were number 8. In the top 10 for “Co-generation” we were number one. In the top 25 for “Refineries and Petrochemicals” we were number 11. So you can see from that, VECO is very specialized in energy, specifically oil and gas. This takes up about 90% of the Veco group’s activities. We focus on oil and gas upstream, midstream and downstream and within that we have specific specialties such as sulphur handling, acid gas etc You mentioned earlier that Veco had an office in Dhahran. When did you move the office to UAE and why did you choose Abu Dhabi as the regional headquarters? The Abu Dhabi office was started in 1994 to support
a project that Veco Calgary (at that time known as Quantel ) had
been awarded in the region. The project , in Abu Dhabi for Gasco,
was the acid gas pipeline in Asab with MAC. The project was significant
in its own right, as it represented Abu Dhabi National Oil Company’s
(ADNOC) initiative to reduce flaring of sour gas. While work progressed
on the laying of a 10-kilometre-long pipeline to transport the sour
gas to a treatment plant at Bab, two years later, VECO Calgary was
awarded yet another project in the region: an estimated $3 million
subcontract at Dukhan in neighbouring Qatar. The scheme, called
processed water injection facility, was aimed at the injection of
water into oil-producing fields to maintain pressure. VECO’s
main task was providing detailed design, procurement and construction
support to the main contractor, Athens-based Consolidated Contractors
International Company (CCC). This was quickly followed by the Detailed
Design contract for ADOC’s Sour Gas Re-injection project at
Mubbarraz island (NPCC constructed the facility), a project which
won for ADOC and its contractors the ADNOC Environmental award.
So really they only setup the Abu Dhabi office as a support office
for those jobs. It was like a man and a horse as it was only one
or two people at that time. It continued to be a support office
for these two or three projects while Calgary was doing the main
work in design, procurement etc… with the Abu Dhabi office
supporting the local construction. The success in implementing these
projects – at Bab, Mubbbaraz and at Dukhan – instilled
confidence in the Abu Dhabi office to bid for more regional projects.
It was only in 1998, strictly speaking, that the Abu Dhabi office
began to grow and started bidding jobs in its own right. On another front and capitalising on Calgary’s experience in the engineering and detailed design of pipelines resulted in VECO being recently awarded a number of major contracts in the UAE. The first is the PMC for the FEED phase of GASCO’s 110-kilometre-long liquid sulphur line from Habshan to Ruwais .The FEED is being done by Parson’s in Houston ,our team from Calgary is performing the PMC role there,and we have hopes and aspirations of continued involvement with this project either in a PMC role or in providing EP services for the successful contractor once this project goes out to Construction. Other projects include the Detailed Design and procurement services for both Dolphin Energy’s 180-kilometre,24 “ Al-Ain-Fujairah gas pipeline; and the 20-kilometre 42 “ gas pipeline from Ruwais to Shuweihat for GASCO. The Abu-Dhabi office is executing the above two gas pipeline projects as a subcontractor to India’s Dodsal , who is the successful EPC contractor on the projects. We hope that by working successfully as the engineering arm to the main EPC contractors such as Dodsal, CPECC (a major Chinese Construction Company),CCC and the like, will result in strategic alliances for future projects not just in Abu Dhabi, but in other countries in the region as well. We have also completed a number of small EPC projects on our own in the UAE and have been successful with a number of Design awards – Most recently, as an example, the FEED contracts from ADCO for both the “ Asab Water Injection Upgrade project “ and the “Huwaila New Field Development” as well as the “Dhukan Field development “ and “Flare Integrity study “ for Qatar petroleum, and the Kharir Hydro-cyclone project for Total-Fina Elf in Yemen. To go back to your original question,I joined in October 1999. Originally the regional headquarters was in Cyprus and I was based there with the offices in Abu Dhabi and India reporting to me. I was in Cyprus for a year but I spent 7 or more months of that year outside Cyprus with 50% of that time in Abu Dhabi. In the end I could see that I needed to be where the real work and growth was. In other words, there was no point in being based in Cyprus when the real action was in the UAE and the gulf region. Since, by that time, we already had an established office in Abu Dhabi , I decided to relocate the headquarters there to reflect the importance of the area and the work that’s available within and around it rather than operate remotely from Cyprus. Cyprus was primarily set up as an offshore company. We were strategically there to target projects in countries such as Syria, Egypt and Turkey. At that time it had seemed like a good central point to service the Middle East and Africa as well. But it wasn’t really working and we needed to be near the heart of the action. So we officially moved to Abu Dhabi in early 2001and and as you can see from the above, this definitely was the right decision and has certainly paid off.
Since 2001 you have obviously solidified your position in this region. What do you attribute to Veco’s ability to enter a new market and establish such a strong position in the last couple of years? Well, short term maybe in the sense that the real growth was in the last 2 -3 years. In part, I attribute it to knowledge of , and presence in, the area. Basically our strategy has been to get to know our clients, get to know our competitors, go for the areas were we have strength and can add value, rather than bid everything. A shot gun effect does not work. We as a company focused on specific clients and specific projects and we were successful in that approach. Once we got those projects, we maintained our commitment to our clients to execute quality work , on time and within budget. This is the way to secure repeat clients and that’s exactly what’s happened. Many of our successes have been with the same clients, while at the same time we are expanding our client base. Being half Iraqi are you looking forward to going back? Very much so, and particularly where I with VECO, can help with reconstruction there. Unfortunately ,the security situation, which appears to be going from bad to worse every day, is not very encouraging and does not allow us, or anybody else for that matter ,the opportunity to do any meaningful work there at present. Let us hope that, and particularly for the sake of the innocent general Iraqi public, that this will improve very soon. Are you looking to do things in Iran as well? In principle, yes. We are in discussions with 2 or 3 different groups that are well established there and are doing work for NIOC. We have looked at 1 or 2 projects and although nothing has developed until now ,we are still hopeful. Of course there are other places, which we are trying like Oman. By the way we are reasonably active in India and we have an office with approximately 20 people there. Although active earlier in a joint venture operation, essentially VECO India started renewed operations in 1999,when it secured its first project for the Oil and Natural Gas Company of India (ONGC) .This was a small EPC project for Hydrocyclone packages on ONGC’s offshore platforms .This was quickly followed by another turnkey project for engineering and installing Pig Launcher/Retriever systems on some 13 platforms off Bombay High. Recently ,we have also transferred some detail design and cadding work from Abu-Dhabi to India to help develop the expertise there and pave the way for more work of this type coming from other companies within the VECO Group. A little known fact ,is that VECO has a 12.5 %
ownership of an Oil transportation pipeline company in Pakistan.
The company is called “Asia Petroleum Ltd.” ,and transports
Fuel Oil to the privately owned power generation plant “HUBCO
“ near Karachi .Through or in association with APL, we are
also looking at some other development projects in that country.
Is all your engineering being done in India and Abu Dhabi? For the Middle East and North Africa largely yes,
but mainly in the Abu-Dhabi office. However for some specialized
projects like the refinery projects in Yemen ,these are being done
out of our Bellingham office in Washington State, USA, as they have
a lot of experience with refineries there. We are also looking at
two or three projects in the UAE involving sulphur treatment and
recovery units and other specialized areas like that where our Calgary
office would be involved as they are particularly specialized in
that area.. Let us say that the majority of upstream and pipeline
work for the region is done very successfully and cost-effectively
here in Abu Dhabi. When projects get very large , it does not make
sense to expand our office in Abu Dhabi when it can be done equally
well by another office in the Veco group that may have free capacity.
So rather than bring in new people or subcontract work, we can call
on the pool of 4000 + professionals working for VECO worldwide and
try to first keep the work within the group. For example for the
larger PMC projects mentioned earlier, most of the key positions
are filled from within the Calgary or other US offices of VECO.
Are you not looking to establish any new engineering offices in the region? We are and we are not. It is a chicken and egg situation. To be successful with Aramco for example you need to have an office in kingdom, so we are talking to two or three people at the moment to establish this kind of operation. We are registered in Dubai and Yemen so strictly speaking we could open an office there to support the work that we are doing in those two countries but essentially it depends on the volume of work. At the moment we have reached an agreement with a specific company in Sudan where we will establish a local office with some minor engineering capabilities initially. Depending on the size of work that develops, this could turn into another fully-fledged engineering office in the region. But for the time being the main engineering will continue to be done from Abu Dhabi. Some of the smaller stuff will be done out of India and the major projects within the Veco group of companies in North America. Do you find major differences in the approach with your various clients? Very much so, obviously some are a joy to deal with as they are very correct and very professional and then some are out to get anything and everything out of the contractor. In particular with the lump sum mentality or the way of doing work in the region ( as opposed to say North America where even the works on an EPC basis are reimbursable ). This obviously can be discouraging sometimes to work with certain clients who expect out of your lump sum to do much more than the contract says but luckily there are not too many of those and we try to avoid them when possible. So yes there is a big difference between clients. Veco has been very successful in obtaining contracts like feasibility studies, FEED and program management and you have also worked in conjunction with Construction contractors like Dodsal in the past. Do you ever consider working as an EPC contractor? We have and are already executing some EPC contracts
in the UAE and India, but on a small scale. We are just starting
to look at some medium size contracts . What has Veco achieved in 2003 and what is you outlook for the rest of the year and 2004? Let us begin by saying that our volume of work
backlog and revenue has doubled every year for the last three years,
and we are looking to equal or better that trend for the coming
years, particularly if we achieve some EPC contract awards. Let
me say in terms of the work that we are handling out of the Abu
Dhabi office, both in terms of design, studies, project management
as well as the smaller EPC contracts, the total installed value
is in excess of 2. 0 billion dollars. This sounds like a lot but
this is not the value of the contracts for us, but is the total
installed cost value of the projects we are handling . Like for
example the ADCO PMC’s. Between the three of them, account
for a 750 million dollars’ worth of investment which we are
responsible for on behalf of ADCO. We have established Veco as one of the main players in the Oil and Gas Industry in the Region. Up there with the international “Big Boys “ We have achieved our goal of developing lasting relationship with repeat clients, and by building up our basket of repeat clients. That means we have had satisfied clients and they keep coming back to us. Inviting us to bid in many contracts, where we have beaten international companies. What I see for this coming year is strengthening
all of that, especially the relationship with our existing clients
and adding new clients who I hope will continue to become preferred
clients and where we are their preferred contractor. Again in the
same terminology I would like to see increase and growth in the
diversity and in the value of the work that we are doing or will
be doing over the next year. So I expect again to double our revenues
and awards. At present we have approximately 115 people working
out of this Abu Dhabi office and add to that some twenty plus people
involved in the project management contracts. Working with this
team is also something in excess of some twenty Chinese engineers
from JPPDI,who we are working with in a joint venture for projects
with Chinese companies .Altogether, I would expect to grow the capacity
in Abu Dhabi to about 200 by the end of this year. These are my
expectations and targets for 2003. What do you like most about your job as president and general manager of Veco in the MENA region and what are you personal ambitions? I always say, if you don’t like what you
are doing get out of it, so I’m still in it because I enjoy
it and I’m challenged by it. I’m challenged by meeting
new clients and maintaining relationships with existing clients
and people within the business community. Of course my job and responsibilities
involves a lot of traveling which I have always enjoyed. Unfortunately,
enjoyed in the sense of traveling for business’ sake. I always
say next time I will take a few days off and look around. I’ve
been to many places that people dream of but say no I don’t
have time to look around this time but will do next time. But next
time almost never comes but then again it has on some occasions.
Veco Engineering Abu Dhabi has been subscribing to DMS for the last year. How are you finding our project tracking system? Excellent! It is definitely commendable what you have done with it over the last year and a half. It has become almost standard in our business and we wish you more success and good luck with that . It is definitely a source of very useful information. Sometimes before the market knows it you are there on top of it. It does make our community in the industry aware of these opportunities. Of course we do our own homework and marketing but DMS is definitely one of the sources we rely on. Veco related projects in DMS. UAE
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