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Interview

with K.T. Tong, CGGVeritas Malaysia

01.03.2010 / Energyboardroom

How did CGGVeritas decide to establish its activities in Malaysia?

As you know, CGGVeritas has grown as a global leader through the combination of excellence in service and technology and recent mergers and acquisitions. Our presence in Malaysia reflects this. Our history here has also closely followed the ambitions of the National Oil Company, PETRONAS, to bring technology into the country, and to develop a viable business out of the oil and gas industry. In the early seventies, I worked for a company called Digicon, which was established at the time in Singapore. However, in the early Eighties, PETRONAS saw great oil and gas potential in Malaysia and drew up frameworks to encourage service providers to establish their offices in Malaysia, focusing on Kuala Lumpur. Following this lead, Digicon opened a processing center in Kuala Lumpur in 1990, and I returned to Malaysia after having worked for the company in its offices in Singapore and Jakarta, Indonesia. Because of the concept of PSCs (Production Sharing Contracts) in Malaysia being based on cost recovery terms, the service industry gradually grew and strengthened. The rest is quite straightforward since Veritas acquired Digicon, and merged with CGG in 2007 to become CGGVeritas as it is known today. As CGGVeritas Malaysia, we now offer solutions ranging from shallow and deepwater marine acquisition to seabed permanent installations and advanced processing and imaging.

PETRONAS and MOGSC are pushing to make Malaysia a service hub for the region. As a leading geophysical company with an edge in high-end technology, how do you assess Malaysia and the rest of the industry in terms of technological hubs and where can CGGVeritas make a difference?

Because international companies are encouraged to bring innovation into the country, I would say that today Malaysia is on a par with any other country in terms of technology. PETRONAS itself wants to develop new tools and technologies, and service providers are setting high standards in their business in this country while gaining recognition as contributors to the local industry. In our niche, CGGVeritas has a leading edge in this domain, and we have already brought in a wide scope of technologies in areas such as seismic data acquisition and processing & imaging. Over the years, the industry has come to realize that the easy days of discovery and production are over and we have to go out to the frontier areas. In addition to moving out to very deep waters, the trend will be to drill deeper in the fields that are already being developed. Now with the technological focus mostly on deepwater, this presents different types of challenges such as high temperature, high pressure, and changes in drilling technology. CGGVeritas has advanced technology in terms of being able to record and image these deeper targets with specific data acquisition and processing & imaging techniques.

Under the assumption that PETRONAS is looking for added value from each and every one of its partners, why is CGGVeritas a good match for PETRONAS?

In terms of data acquisition we can bring in seismic vessels with high-end energy source and industry-preferred solid Sercel Sentinel streamer configurations, now being enhanced with Nautilus streamer control to acquire high-quality seismic data down to great depths. And we have even further advanced capabilities for deep-target high-resolution data acquisition that will be released later this year.
In addition to the technology, we also have a research group based in Singapore, as part of our worldwide R&D and can leverage on these experts to inject higher technological content into our regional market. PETRONAS is able to access this technology through CGGVeritas, and we already have several deepwater projects in the pipeline.

From the CGGVeritas 2009 annual report, Asia Pacific represents 26.5% of the group’s revenue. What is the importance of your Malaysian activities to the Asia Pacific region overall and to the group in general?

Our Malaysian presence is part of the Asia Pacific region, headquartered in Singapore. Malaysia is one of the most active regions through our local business and is also an important location in Asia Pacific in terms of revenue and people. The great thing that unites us in the region is that we use the same hardware and software and speak the same language. We can easily mobilize our resources and go places where our services are required, being able to move our vessels rapidly from Indonesia to Myanmar or India, for example.

One problem within the region is being able to shoot within the monsoon. How does CGGVeritas overcome this challenge?

The monsoon season is the same from year to year, and it is a parameter that we have to take into account. The first and most important thing is to plan together with the oil companies based on their requirements and our vessel availability. Technologically, there is no single, easy way to overcome the monsoon: when the season starts, and the sea gets rough, the weather can become severe enough to require us to stop shooting for a few days until the weather calms down. However, the “shooting window” over the monsoon season may be extended by using a combination of high-tech acquisition equipment such as our Sentinel solid streamers and special data processing software such as swell noise attenuation techniques.

CGGVeritas’ growth has come from recent acquisitions. How will the future growth of CGGVeritas Malaysia be fed: organic growth, acquisitions, etc?

Over our past history we created an industry leader, and now we are focused on using our current strengths to grow organically to further strengthen our leadership.

Given that CGGVeritas is a leader in high-end seismic vessels, do you think that Malaysia is looking for these kinds of technologies or looking to get cheaper technology?

Today all oil companies are pushing very hard towards high technology. The reason for this is simple: Malaysia is not a big country and has limited areas available for petroleum exploration activities. It is therefore an obvious requirement to go beyond certain geographical boundaries such as deepwater areas to find new oil to add to the country’s reserves. CGGVeritas provides the necessary data acquisition and processing technologies to help Malaysia achieve this target.

Under the new impetus of Shamsul Azhar Abbas, PETRONAS is looking to further develop its domestic exploration and resources. How is CGGVeritas positioning itself to be recognized as the partner for PETRONAS to help them find new resources?

One of the main challenges in the Malay Basin is the presence of “gas clouds” which causes distortion and loss of seismic signals by conventional acquisition techniques. CGGVeritas is very advanced in Ocean Bottom Cable (OBC), multicomponent data and wide-azimuth acquisition technologies that help to image seismic events beneath these shallow gas anomalies. We introduced the advanced technique, known as CBM – Controlled Beam Migration – a processing software package for better data imaging of deeper targets, to most of the oil companies in the country.

Do you believe that some technology will emerge from Malaysia and be used by your company globally?

Certainly as Malaysia is implementing new solutions and creating new technology via joint research programs with leading service providers like CGGVeritas or through the research arm of PETRONAS, PRSB.

What is CGGVeritas doing to attract young graduates in Malaysia, and raise the image of the industry among them?

CGGVeritas has the geographical reach, the breadth of disciplines, a unique culture and the advanced technology to offer potential candidates and give our employees the opportunity needed to gain operational and/or technical experience in a variety of of contrasting, challenging and highly motivating geographical locations and business situations.
We are also focused on training. CGGVeritas is in discussion with the University Technology Petronas to develop joint programs. And we take advantage of our strong internal training capabilities offered by CGGVeritas University to develop employee capabilities. Finally, we “Malaysianize” our company to ensure local technology transfer and the building of local expertise.

What are your ambitions for CGGVeritas in the near future?

We are committed to maintaining our technology leadership position, with the support of our R&D offices throughout our global network. No technology is far from us internally, and anything that is available within CGGVeritas is also available in Malaysia. We are always close to R&D, new technologies and our clients. This allows us to develop the tools needed to continually drive the advance of exploration and production.
We also have a strong focus on sustainable development through our Sustainable Development & Social Responsibility program, and have a strong sense of Corporate Social Responsibility, being a part of the community in Malaysia.

As a Malaysian, and given your many years of experience in the oil and gas industry in the country, what can you tell us about CGGVeritas’ contribution to putting Malaysia on the map?

Malaysia continues to put itself on the map and strengthen its worldwide presence. At CGGVeritas, we have only played a supportive role and it comes down to the notion of technology and service, and making sure that our new technology continues to meet our clients’ needs both today and well into the future

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