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Graham Hill, Senior Vice-President, WorleyParsons, Asia & Middle East

30.06.2014 / Energyboardroom

Graham Hill, Senior Vice-President, Asia & Middle East, describes Worley Parson’s unique mixture of Eastern and Western values that help ensure its leading position in EPC projects throughout Asia from a strong Singapore base. He details the recent customer-centered restructuring of the company into the services, major products, and improve divisions, which has allowed Worley Parsons to align more closely with its original values.

Since you took up your role with WorleyParsons as senior vice-president for business development what have been the major milestones which have forwarded the company’s interests?

When I first came to WorleyParsons in this region, the business had a small office in Singapore, though it had been executing work in Asia for over twenty years. The first international office in the Worley heritage group of companies was in Brunei and we subsequently moved into Malaysia and Indonesia, and then Thailand.

Asia is natural territory for WorleyParsons and being so close to our land of origin – Australia, time zones and cross-cultural integration between Asia and Australia (for example with Asians attending Australian universities) means that operating here has been an easy move. Asia is our second “home” for the company, unlike many other western companies moving in from Europe or America.

The Singapore office started as an infrastructure office where the business was focused on buildings and subway stations and infrastructure projects of that ilk. Shortly after my arrival, the company diversified into oil and gas. Today Singapore is a regional centre for subsea and subsea pipelines as well as refining, chemicals and petrochemicals work. Another aspect of the operations taken forward from the Singapore office is work on FPSO (floating production, storage and offloading) vessels.

From humble beginnings solely as an infrastructure office, the Singapore wing of our enterprise has now diversified across the oil and gas sector. Along the way to reaching this stage, we acquired a power company by the name of Development Resources.

Today our Singapore business stands in three segments; oil & gas, power, and infrastructure. It is a diversified business and thus we can roll with various market trends, as they progress.

From its Malaysian, Thai and Singaporean offices, the business also works into Myanmar and Vietnam.

We have one of the longest records for a company working in Myanmar, being involved with the Yadana pipeline for Total and the Yetagun development for Premier.

For the financial year 2013, WorleyParsons achieved aggregate revenues of USD 7.2 billion, to which Asia and China region contributed approximately seven percent. Looking beyond these figures, what is the strategic importance of the APAC region to the company’s operations?

Asia is a very important part of the overall make up of WorleyParsons – firstly because of the history and legacy that the company has here. This was the business’ first venture overseas and now is in effect “home territory”.

There is also a great deal of intellectual capacity in Asia and a huge proportion of our human resources originate here.

It is impossible to speak about Asia without discussing the role of China as we invested there for the first time about 11 years ago, buying into a very small company. However, this enterprise has grown significantly and is now the leading foreign EPCM contractor in the country.

All of the Asian offices, but particularly that in China are exporting globally, working with the wider WorleyParsons group in different markets, be those Europe, Canada, the USA, Australia or Middle East. Internally, we are exporting from Asia to the other offices within our network.

There is a huge intellect here, an aptitude for hard work and integrity, tremendous skills and a resilient culture. Our business wants to tap into that culture; it is energising to live here and work within that market. When our Asian offices are working with our other offices, the latter are energised as well.

From the demand side, there are also a great many customers in this area we are very familiar with. These customers are now investing in other places, for example, we announced recently that we had won the first phase of Shell’s LNG project in Western Canada. There are co-investors in that project, CNPC from China and Kogas from Korea, which are both in their own right, good customers of ours in this part of the world. Now we are working with our Canadian offices and our joint venture partners on that project.

You mentioned your offices here direct activities in oil and gas, infrastructure and power. What is the contribution of oil and gas towards the company and how does the company allocate resources to forward each of these sectors?

The overall contribution of the hydrocarbons business towards WorleyParsons is around 70 percent. I would say in Asia it represents a slightly higher figure than in the rest of our operations. This reflects the importance of the minerals and metals business elsewhere and the maturity of the infrastructure business in Asia itself. Asian domestic companies are very competent in delivering infrastructure projects. For this reason, our market penetration is not as high as it might be, but it also means that the total contribution of hydrocarbons related business is higher in Asia than the company average.

How would you rate the current state of oil and gas infrastructure in South East Asia?

Talking about oil and gas infrastructure, I would use the word ‘independent’. There is virtually no connectivity in Asia between hydrocarbons infrastructure components in varying countries, such as in Myanmar and Thailand and between Indonesia and Singapore. For many years greater interconnectivity across boundaries and improved trade for the benefit of the seller and buyer has been discussed. ASEAN has tried to push this historically, but does not seem to have made significant steps forward as yet. The day when subsea and overland pipelines are more plentiful across the region is one to be anticipated warmly.

In Singapore, WorleyParsons undertakes a great many LNG terminal regasification projects. This is not only because of Singapore LNG, but also because from this base, our company is able to reach out to gasification projects all over the world – in places like Bahrain, Thailand, South Africa and Trinidad & Tobago.

Could you elaborate on how WorleyParsons’ recent restructuring will affect the Singaporean and Asian offices?

The reorganisation focused on three large business lines, ‘Major Projects’, ‘Services’ and ‘Improve’. All of these business lines are evident in Asia today. For example the ‘Improve’ business is about long term asset support for customers in the operating phase of these projects. In Northern Sumatra, one example is our work with Chevron where we are expanding and enhancing their oil fields there. These are mature oil fields and we are the business that keeps the oil flowing from them.

In the Philippines, for Shell on their Malampaya facilities, we are undertaking the same type of work – maintenance, monitoring and upgrading. The “lights are kept on in Luzon”, because we support gas production from these facilities.

In ‘major projects’ we are constructing a very large gas plant project in China for Chevron. This is a USD 3.5 billion investment in a sour gas facility and represents a prime example of the type of work this section of our business covers.

The majority of our business in Asia is in the ‘Services’ business line, however and this means there are thousands of people, working daily with customers to deliver quality services. This is the reason WorleyParsons has so many local offices – proximity to our customers’ facilitates and the ability to operate closely with customers providing local knowledge and relationships. We want to be responding in real time to customers’ needs.

It is the differences between these service delivery models that necessitated the change in structure to better align with our customers’ businesses.

Looking about one of the projects you mentioned in Northern Sumatra under your ‘Improve’ business wing; what do you think of the ‘greater Singapore project’ and are you helping facilitate any synergies which will improve connectivity across the region?

Over the years, there have been three gas lines constructed to feed Singapore and our business has been heavily involved with two of them- one from Indonesia in the east, with ConocoPhillips, and one in the west from southern Sumatra.

This is an example of integration benefitting both Singapore and the exporting country. The service companies have gained too; those designing and engineering, the installation companies and the marine businesses have all profited.

How will you manage the cultural change that will happen due to the restructuring of the company?

One of the positive elements of the restructuring that we have embarked on is that by far the majority of people in the company are only affected in a positive way. The restructuring is about benefitting the customer and our staff understand this. It does affect the top echelon of our management team and the redesigned management plan has been scoped to promote leadership. This is an exciting prospect because making customers central to the business will ensure our company will prosper.

This is a simple philosophy, led by our CEO Andrew Wood, that takes us back to our heritage and the foundations of WorleyParsons, established by our Chairman, John Grill.

Where do you see the chief prospects for growth in this region?

There is still some refining capacity which can grow here, certainly some petrochemical and chemical activity will move forward as this location is very close to the centres of demand. Offshore, there is likely to be growth in LNG across the region.

Many parties have high hopes for Myanmar. Gas seems abundant in that nation and the construction of a pipeline to China is a tremendous asset which has been financed by the Chinese state. This is a great incentive for companies to locate and develop gas for the ready and hungry Chinese market. For Myanmar, this would bring income through selling gas as well as providing a competitive energy supply domestically.

The country will also need some downstream infrastructure to satisfy their own domestic needs, and to bolster GDP by supplying their own local industries.

What keeps you motivated day to day with WorleyParsons?

I have already mentioned that Asia is an energising place. I am a very simple person – I like hard work and integrity. This energy motivates me and here I find myself amongst a culture I feel very comfortable with because hard work and integrity are core to Asian culture.

There is also a great deal of intellectual ability here which leads to good business – for Asia and the rest of the world.

If you had a dream project, what would it be?

The dream project for me is to bring the competitive advantage of our Asian offices; particularly that of the Chinese, Malaysian and Indian offices and mobilize the sheer intellect of those places fully to bear on the rest of the world. Asia has a great deal to offer North America in particular, in terms of investment, equipment supply and raw energy. The combination of the North American culture and the Asian one is a very powerful mix.

It is of note that many of our customers are now investing in Asia, not only in facilities but also in people- opening recruitment centres and locations for training across China, India, Singapore and Malaysia in particular. This is tapping into the trade routes and the sheer numbers of individuals going to university with the ability to fit into the international business environment.

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