Register to download the report. Already a member?

Download PDF

Click Here for $250 / 6 months

Click Here for $450 / year


with G. Sathiamoorthy, Managing Director, Tecnimont ICB

04.07.2011 / Energyboardroom

All of our readers know about the group Tecnimont, but perhaps less about Tecnimont ICB (TICB). Could you start by telling us what are the specificities and scope of operations of TICB in India?

The company first started as a family owned company called ICB ltd in 1958 by the Kapadia family. In 1996, Tecnimont S.p.A. Italy, one of the leading EPC companies in Europe acquired 50% equity and the company was re-christened as Tecnimont ICB Pvt. Ltd. By 2007, Tecnimont acquired balance 50% equity and the company became a fully owned subsidiary of Tecnimont SpA. Post alliance Mr PN Kapadia was on the board of directors and he had an executive position as Chairman and Managing Director. Post 100% acquisition of the company, he continued as the Chairman of the board until last year, till then the MD was an expatriate.
TICB’s added value to the group is its human resources. Indeed, 40% of the group’s employees work for the Indian subsidiary today. Although the company started as an engineering centre, it is no longer just that, and it is now seen by our shareholders as a centre of excellence for EPC jobs. As a matter of fact, TICB’s people are not only tuned to do engineering in India, but they have proved competence on a Global platform. For any job that Tecnimont takes up, India’s engineering capacities are naturally granted. The fact that a majority of the engineering work will be executed in India is a transparent fact shared with client and very well received.
The other segment where TICB plays a big role is in the electrical and instrumentation (E&I) construction. Since its inception 3 decades ago, the E&I division has executed some important projects, it remained one of ICB’s core capabilities. Since Tecnimont took the E&I construction world-wide, this division has been very successful in execution of jobs especially in the Middle East – namely Saudi Arabia, Abu Dhabi, and Kuwait.
Tecnimont ICB has been doing sizable turnkey projects independently within the Indian and Middle Eastern market.

The Group Revenues at 31 March 2011 increase by 14.7% compared to 31 March 2010, and this growth has been mostly driven by the oil, gas and petrochemicals business unit (73,9% growth in revenues). How much has Tecnimont ICB contributed to the group’s performance in this sector of activity?

TICB’s performance has been in line with the group’s performance. Our key focus is in the Refining and Oil & Gas sector.
This year has widened the scope by acquiring two major contracts within the petrochemical sector in Gujarat for ONGC Petro additions Limited (OPaL), a joint venture company promoted by Oil and Natural Gas Corporation (ONGC), Gujarat State Petroleum Corporation (GSPC) and Gas Authority of India Limited (GAIL)These awards represent an important milestone for Maire Tecnimont to consolidate its presence in the Indian EPC sector.

How important have been your collaborations with both the public and private sector, including the ones with ONGC (MRPL), Shell and GPIC?

In India, lump-sum turnkey projects are primarily with public sector companies. The association with these Public Sector Undertakings (PSUs) is vital for us.
The association with Shell has been very instructive, as Shell has brought in very good practices and safety aspects, even though Indian clients are of course also very concerned about safety.
In the refining segment, TICB is currently executing the Heavy Coker Gas Oil Hydrotreating unit (CHTU) of MRPL at Mangalore as well as the Sulphur Handling and Storage Project of Indian Oil Corporation Ltd (IOCL) at Panipat on EPC LSTK.

TICB executed multiple Carbon-Di-oxide Recovery (CDR) units for IFFCO, Nagarjuna Fertilizers & Chemicals Ltd, Gulf Petrochemical Industries Company etc. We have recently commissioned a 450 TPD Carbon Di Oxide Recovery Plant in Bahrain for Gulf Petrochemicals Industries Co (GPIC) and consequence of TICB’s superior execution standards have also bagged new orders from GPIC for EPC realization of their HP Steam Boiler and substation projects in Bahrain.

As you mentioned, India is a very state dominated market. Mr. Sathiamoorthy, you are the first Indian native to run this affiliate, since ICB has been acquired by Tecnimont in 1997. Why is it important today to have an Indian run the company in India?

An Indian executive would always have the hands-on insight into the Indian market and mind-set. An Indian executive would always be better tuned to the various socio-political challenges that are faced by EPC companies maybe that were the driving force for the group to decide upon appointing an Indian MD as compared to an expatriate.
My appointment is the result of my long involvement in the company; I have worked very closely on the integration process of Tecnimont with ICB, as I was heading the engineering division of the company before. I was working very closely with the Italian colleagues for many years.
On 6th July 2011, I will complete one year as the managing director of TICB. It is an exciting job.

How challenging is it to manage the company following the Kapadia’s business philosophy vs. applying the corporate principles of a multinational organization?

Post acquisition of 50%, the company has been more with the Tecnimont group’s outlooks and procedures. Our quality system is also based upon the Tecnimont quality system.

If you had to assess the general business environment of the Indian EPC market, what do you identify as the main trends and growth prospects in the Indian O&G sector?

Currently, TICB does not look at the upstream market, although that might change in the future. The company is more focused on the gas processing and refinery units. Although our crude treating capacity far exceeds the country’s requirements, we see a lot of growth in the refining capacity of India in the near future. Tecnimont Group foresees a great potential to participate in these expansion projects

What is your strategy to grasp new market opportunities?

The last acquisition Maire Tecnimont made of Technip KT, Rome (Now rechristened Tecnimont KT) – a process engineering company that comes with a very rich experience and with good knowledge and references in the refining area, gives us an edge in positioning ourselves in the market. We will be working together with them and leverage their technology. They are a good addition to the group that, I am sure, will prove an advantage in the Indian context.
The acquisition of Stamicarbon – the Group’s Urea Licensing unit has added to our competencies in the fertilizer sector.
Since the acquisition of what is now called Tecnimont KT and Stamicarbon, the objectives have evolved, as we can participate effectively in diverse sectors.

The company has established offices in Qatar and in the Middle East. What are TICB’s next targeted markets? With 50 years of experience and the completion of over 350 projects to what extent can India serve as a basis for a strong international development?

TICB presence in Gulf is more attributed to the foreign operations, when you need to register and have a local presence to execute a construction project.
We have the competence of executing projects in the Middle East as an Independent Unit. As I mentioned previously that TICB is executing a project for GPIC in Bahrain Although it is a small project but a repeat order from the client for the supply of high pressure oil. Our main market is India. For the Middle East and Far East Asia market, we are looking at projects where sizes are suitable to our capacities.

TICB is one of the leading companies in EPC in India. Could we see in the future a more diversified company in India?

India is currently buzzing with new opportunities for gas treatment, refinery and fertilizer units. TICB has the references and the capabilities to undertake these projects. There is a lot potential in the O&G industry, some LNG terminals are under discussion. The company is eyeing few prospects in the refining segment. We do foresee the refining sector to gain momentum next year with new / expansion projects getting finalized.

What would you like to have developed at TICB in five years from now?

We are already deemed as the Group’s ‘Centre of Excellence’. We further intend to augment this potential. We have special in-house trainings for project management. Our human resources department is prominent within the group for its activity and its efficiency. For instance, there are around twenty graduate trainees joining the company this month.

What will be your final message to the international readers of the Oil and Gas Financial Journal?

The market looks very bright; refining and fertilizers are the two areas where we see the most potential. TICB has the potential and competence to deliver par excellence.



Most Read