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Interview

Dagfinn O.Tegnander, Regional Director of Oil & Gas, and Lars Alvsvag, Managing Director, Scana, Singapore

Dagfinn O. TegnanderDagfinn O.Tegnander, Regional Director of Oil & Gas, and Lars Alvsvag, Managing Director at Scana Propulsion discuss Singapore‘s ability to simultaneously support the aftersales oil and gas market, while casting doubt over the city-state’s ability to become an engineering powerhouse.

 

How has Scana’s offshore presence in Southeast Asia expanded since 2010?

Dagfinn O. Tegnander:  Scana is known as a steel, product and equipment supplier. For over two decades Scana Offshore has been working with established partners such as: Statoil, Seven Marine and Advanced Production and Loading (APL). Yet, if analyzing the track record of Scana Offshore, the company’s reputation as a system supplier is limited. This is because Scana Offshore has been acting as a sub-supplier of its major clients, and as a result, we are not perceived to have the necessary track record in the system supplier arena.

When I joined the company in 2010, the Scana Offshore name was not prevalent in Southeast Asia. The Scana brand was associated with its steel and product manufacturing capabilities; indeed, it was barely known for its offshore system supply services. Consequently, we are in a process of re-defining Scana’s offshore image; we want to be known for our offshore solutions and supplier platform. Enlightening and educating our clients about this service transition is fundamental to the company’s future growth. This involves constant communication, exhibition exercises and a targeted marketing campaign.

Lars Alvsvag: In 2010, our primary objective was to invest a lot of effort and energy in marketing the company and building our brand in the region. Initially, we did this through aligning our service offering with larger companies, so we could provide a broader service platform. Slowly, we have taken the path to market our products directly to the customers.

What is the strategic value of Singapore for Scana?

LA: From a marine and propulsion perspective, Scana operates and works from a project basis. As a consequence, we aim to give the client consistent and strong technical support. This has to be done in person as an email or phone call does not suffice. As a substantial proportion of Southeast Asia’s shipping market and network is in Singapore, we have to be where the client is and that is why we have a tangible presence in the city-state.

Considering the fact that a stream of offshore companies are gravitating northwards to Malaysia because it is increasing seen as more compatible for companies requiring significant land space and engineering manpower, what is the advantage of being in Singapore, rather than Malaysia?

DOT: My history stems from APL and in 2004, when the company sought to establish a foothold in Southeast Asia, we chose Kuala Lumpur. The primary reason behind choosing Kuala Lumpur over Singapore was because we wanted to develop a strong engineering arsenal, and this can be easier achieved in Malaysia than in Singapore. Moreover, the key factor to consider is that this was always intended to be an engineering hub. One does not need to be next door to the shipyard or vessel owners. However, if you are a company operating in the aftersales market (maintenance, repair and marketing), Singapore is the preferable place to be. This is partly because in Singapore, the entire network is located in one single place and the port efficiency is unrivalled in the region.

Singapore has invested a lot of capital in its R&D infrastructure. As a niche engineering company, what role will Singapore play in designing and procuring the next generation of Scana’s offshore and marine equipment?

DOT: This is a very important topic. Norway is a small country that has pioneered and spearheaded R&D and engineering innovation throughout the oil and gas value chain. Today, although Norwegian engineers are classified as high cost resources, there remains a vast number of active engineers in Norway. There are few places in the world where you can find top talent, engineering and innovation, but Norway is certainly one of them. Nevertheless, if one goes from the concept design and into detail design, and when man hours in a project increases exponentially, then Singapore is a more preferable and cost effective place to be.

As mentioned, we are incrementally reshaping Scana’s image and Singapore is right at the very epicentre in driving the company’s transition. We are not leaving Singapore; rather, we are looking to increase our presence in here. In augmenting our footprint in Asia-Pacific, Singapore is the perfect place to launch from.

LA: When it comes to innovation, Norway is still ahead of the curve. The country continues to add products and procedures to its innovator conveyor belt. Though Asian countries and companies are emulating North Sea technology and equipment, by the time it is incorporated into their business model, Norway produces a new product. As long as Norway maintains this forward thinking trajectory and path, Norway will be the global R&D hub for the oil, gas and marine industry.

How important is Southeast Asia towards supplementing the company’s long-term growth?

DOT: If we want to take part in the upstream ascent of Southeast Asia and South China Sea, we need to provide clients with systems and solutions. The major NOC and IOCs are seeking these products and there is a window of opportunity in the market for Scana to capitalize upon. Ultimately, the region is alive with energy and is clearly emerging as a core global energy force. Hence the reason the corporate office in Norway is right behind us in our restructuring of the company—the time is ripe for growth.

Why would a company choose to partner Scana Offshore ahead of market competitors? And what makes Scana Offshore the partner of choice?

DOT: First and foremost, being a Norwegian engineering company, we generate new technology and that is our advantage: we can develop and design new and cutting-edge solutions for our clients. Leveraging our centre of excellence capabilities in Norway and bringing that know-how, knowledge base and Norwegian stamp of quality to Southeast Asia is another competitive edge.

How important is the oil & gas industry to Scana’s regional growth?

LA: The oil and gas division is central to Scana Singapore’s development and this is partly because it overlaps with other branches of the business. For example, for the shipping division, a lot of our propulsion systems are channelled into the offshore vessel sector. Oil and Gas is a significant arm of Scana’s current and future business mdoel.

Fast forward three years from now, how would Scana Offshore in Singapore have evolved?

DOT: Three years from now we should have changed our image from a product to a systems supplier. We would be present in Singapore, spearheading our sales and marketing operations from here.

Finally, as part of our restructuring process, we are partnering with companies that can complement Scana Offshore from a work and cultural perspective. This could be in Singapore or in the region.

We are aware that the countries in SEA have local content regulations, and are therefore joining forces with companies that have the necessary local foothold.

 

To read more interviews and articles on Singapore, and to download the latest free report on the country, click here.

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