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Interview

with Edward Heerema, Founder and President, Allseas

25.02.2010 / Energyboardroom

You’re the founder of a company which grew from 15 employees 24 years ago to more than 2.000, becoming a word leader in offshore pipelay and subsea construction. What was the strategy behind such a success?

The main strategy behind Allseas’ success – from its origins up to nowadays – has been our persistent emphasis on groundbreaking technology that fits exactly our clients’ needs. The experience of working as an engineer for my father Pieter Schelte Heerema, an extremely creative person, has taught me that the key to success was to always do something technically better than your previous project – and so I applied this philosophy with Allseas.

The results of such a strategy are clear. From 1986 to date, Allseas has executed more than 200 offshore pipelay and trenching contracts for oil and gas companies; the total length of pipelines installed to date is over 14500 km; and the total length of pipelines trenched to date is almost 3300 km.

By always providing the best technological basis to our clients, Allseas has become a worldwide reference in a number of fields such as offshore pipeline installation, design, installation engineering, procurement, fabrication and large subcontracted scopes for diving, dredging, rock dumping, landfalls and so on.

What would you highlight as the main obstacles you had to overcome to move from a small player in a saturated market to a world leader?

25 years is a long time and we have put an insurmountable amount of work in order to be where we are – there is no quick and easy way for success. Allseas started with a small enthusiastic group with whom we built our first ship with lots of imagination and this is how we got our first contract. From there on, one success led to the next.

A few years after its foundation Allseas got a very good reputation in the industry, allowing us to then build a much larger ship. Our first big project was Lorelay and its key element was laying pipes on dynamic positioning, which had never been done before. Dynamic positioning was already available but laying pipes on dynamic positioning where the ship moves ahead step-by-step was a valuable novelty.

When Allseas proved that this was a very efficient way of laying pipes, we were instantaneously anxious to be able to lay bigger pipes since we were still in the league of small pipelines with our first ship.

Thus, our dream was to build a bigger pipelay ship, which came to be the Solitaire. At the time it was an almost overly ambitious step, as the building of the ship became a big challenge. We had to transfer its construction from the shipyard in Singapore and finish it in England, which was quite dramatic, but we brought it to a good end. Having overcome these challenges, the Solitaire has become a huge success in the industry.

Being privately owned was a great advantage throughout Allseas’ evolution, since we never had short-term constraints from shareholders – the only opinion that matters is our clients’.

Mr Hans de Boer, secretary general of IRO, highlighted the increased success of Dutch service providers in international markets. According to him, more than 70% of the sector’s revenues come from international markets, and this share is due to continue rising. To which extent does Allseas depend on international markets and, in your opinion, did the Dutch origins of the company influence its success overseas?

In line with the sector, most of Allseas’ demand rests abroad. Actually, in most recent years on average more than 95% of our revenues come from overseas. The Dutch industry is very internationally oriented because we have a relatively small continental shelf; every company in Holland that wants to be significant has to look beyond its borders in order to succeed.

Furthermore, the Dutch are a very ambitious people; they are good entrepreneurs with a lot of common sense and full of energy. We also have the advantage of having a very good knowledge base in Holland with well-educated engineers, and Rotterdam has a great harbour with a large number of competitive service companies. All these elements make the Netherlands an ideal base from which to seize international opportunities.

What are the most promising international markets for Allseas and what is your strategy to further penetrate them?

Allseas is looking for opportunities wherever they are presented. The North Sea has historically been an important area, although it has declined in relative terms. Nowadays the Gulf of Mexico is very important, Australia as well, and I can also mention Trinidad and Tobago, India, Brazil or anywhere else where opportunities appear.

Our strategy is to keep an eye on every project that is coming ahead and we do not promise the world when we are not able to deliver it. We have to make sure that we are technically suited to do the job we look after. We have to speak to the client and make sure that we can make a good and realistic offer that will suit our client’s needs perfectly.

As you said, the success of Allseas lies in the fact that you built-up your own technology and expertise in-house, always trying to be in the lead of cutting-edge technology. Naturally, this was only possible due to the talent you managed to attract to the company. Having grown from 15 to 2000 people, how did you manage to attract and retain the best talent inside Allseas?

Instead of hunting talented and experienced people from outside, Allseas prefers to attract young and bright people and help them develop professionally inside the company. Since the beginning we provide our workers with cutting-edge training. and from a very early stage they are given responsibilities, creating an atmosphere in which young and talented people thrive.

Looking towards the future, what are you main ambitions for Allseas for the next three to five years?

The next great step for Allseas will be to build the Pieter Schelte, which will be the biggest ship in the offshore area ever built – this will take around three years to be finished. In the pipelay business we want to keep Allseas’ prominent position in the world, laying deeper and heavier pipelines. There is not a step-up from where we are in pipelay, because Allseas is already worldwide and is involved in the most difficult and most heavy projects in place. Our aim is to keep Allseas’ leadership in this market.

The fact that Allseas is a privately owned company is of special value to our business, since it allows us to focus our strengths on long-term projects such as the Pieter Schelte that no other public company could. Allseas can neglect short-term unproductive demands and focus on its long-term development and technological expertise. Our success has always relied on our capacity to be in the forefront of technological progress, and we will continue to trail that same track. After all, my passion is to build better boats.

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