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Interview

with PK Gupta, President for Asia Pacific operations, Punj Lloyd

26.04.2011 / Energyboardroom

Punj Lloyd has had a very impressive history: please could you describe the company as it stands today?

From a pipeline company in 1982, Punj Lloyd rapidly expanded to provide the entire gamut of EPC services in Oil & Gas, ranging from Upstream to Downstream. Cementing its infrastructure capabilities with the acquisition of Sembawang Engineers and Constructors in 2006, Punj Lloyd established itself as a diversified international conglomerate offering EPC services in Energy and Infrastructure sectors, along with engineering and manufacturing capabilities in the Defence sector.

Presently the Group has international operations in 20 countries spanning the Middle East & Africa, Caspian, Asia Pacific, South Asia, Europe & China.

The Group has been fast to explore potential opportunities in various businesses. It set up Punj Lloyd Delta Renewables, a subsidiary to pursue renewable energy based projects throughout the world, incorporated Punj Lloyd Upstream to address the opportunities in the Integrated Drilling Services market and acquired a stake in Airworks India, one of the leading independent providers of Aviation Maintenance, Repair and Overhaul (MRO) services in India. PL Engineering, a dedicated engineering arm, was established with over 750 qualified engineers providing design & engineering to Oil & Gas, Power, Defence and Aerospace sectors.

You are known as a company for the scale of your growth, and as you were saying, traditionally Punj Lloyd has grown organically. What was it that made you take the decision to take this acquisition in 2006?

This acquisition was in line with Punj Lloyd’s strategic intent to expand its geographical reach and enhance its portfolio in complementary sectors. Punj Lloyd already had a formidable presence in South Asia, Middle East, Asia Pacific, Caspian and Africa. With this acquisition, its operations expanded to Europe, China besides Iran and other SE Asian market.
With this acquisition, Punj Lloyd added airports, jetties, MRT/LRT, tunneling, high-spec buildings, sewerage amongst others, to its capabilities in the infrastructure domain. In the petrochemical sector, Punj Lloyd leveraged Simon Carves’ expertise, a 130 year old engineering company.

How difficult has it been for the company to build its international reputation, and how is Punj Lloyd perceived today by the industry abroad?

Punj Lloyd first ventured overseas in 1992 with the Balongan-Jakarta Product Pipeline contract in Indonesia. The first step taken, there was no stopping Punj Lloyd. With a passionate and skilled workforce, Punj Lloyd soon established the reputation of a contractor that could deliver in any geography, undeterred by the terrain or climate. Growing from pipelines to tankage to refineries, Punj Lloyd delivered complex units with ease. The clients in turn trusted us with their mega projects. Whether it was building the storage tank terminal for Helios or Horizon in Singapore or laying pipelines in the scorching heat in Oman or Qatar, Punj Lloyd soon became synonymous with quality.

With our reputation in EPC established, we partnered with the world’s best in pursuit of new opportunities in the global marketplace. Through strategic acquisitions, our portfolio grew to include engineering, petrochemicals, offshore, renewables, high-spec buildings and infrastructure like airports, jetties, mass rapid and light rail transit systems, luxury hotels and resorts.

The diversity of our partners has increased the range of our expertise – niche engineering, oil drilling, aviation, insulation services for varied sectors, while making significant inroads into the fields of defence and nuclear energy.

How well recognized is the Punj Lloyd brand today? Is it a company that people want to work with?

Punj Lloyd is today a globally reputed brand. The brand lives up to its values of performance, passion, teamwork, reliability and agility.

A lot of differentiators set the brand apart from its competitors. The huge self-owned fleet of equipment, rich multicultural manpower from over 37 nationalities, large portfolio of services and presence across 20 geographies. The Punj Lloyd brand has taken shape slowly. Our first international market was Indonesia. When the economic crisis struck Indonesia and all international companies relocated themselves, Punj Lloyd continued its operations and stood tall throughout the crisis. Punj Lloyd has been established there for almost fifteen years now. We have executed repeat contracts with all our clients in Indonesia which is recognition of the quality of our work.

With every successful project, the Punj Lloyd brand has grown. Clients from all over the world have entrusted us with projects of national significance. Malaysia’s longest pipeline – Sabah Sarawak Gas Pipeline for Petronas, The Strategic Gas Transmission pipeline project in Qatar for Qatar Petroleum, the world’s largest wheat-based bioethanol plant in UK, Oman Gas Export Pipeline for PDO, Hydrocracker and Hydrogen Generation Unit in Haldia Refinery for Indian Oil Corporation, Baku Tbilisi Ceyhan Pipeline sections in Turkey and Georgia, involvement in all three LNG terminals in India, pipeline projects under the national gas grid in India, Changi Airport expansion in Singapore, highways under the Golden Quadrilateral – India’s national infrastructural dream, 21 % of Singapore’s all MRT and LRT tracks and more.

The Group never stops innovating and keeps keep pushing boundaries, expanding horizons. Building projects that are ever bigger and bolder, more challenging and complex. The company is seen in different countries as an active player in diverse fields and are known to all by one trusted name, Punj Lloyd.
Punj Lloyd is a dream for most youngsters, specially engineering students, who get a taste of working at project sites in India and abroad.

Punj Lloyd’s global competitors seem to be starting to show an interest in the Indian market. How do you stand up in India and abroad as the partner of choice? What gives Punj Lloyd its unique edge?

Be it the Indian market or markets overseas, Punj Lloyd is today a preferred EPC contractor.

Fast Mobilisation
The Group can undertake projects in any part of the world due to its fast mobilisation of resources. Its multi-million dollar fleet of equipment is constantly being upgraded to undertake more challenging projects.

Sound Track Record
Punj Lloyd has a track record of executing complex projects in challenging conditions and timeframes. It is this spirit of doing the impossible that saw Punj Lloyd go beyond its borders into uncharted terrain, diversify into different businesses, forge unique partnerships and achieve robust growth in business.

The Group has built landmark projects across the world in oil & gas, infrastructure, petrochemical and power sectors.

Power to Innovate
Punj Lloyd is one of those companies that never cease to grow. From entering the emerging Renewables sector, Punj Lloyd also made inroads into Defence. The Group has set up a state of the art fabrication and assembly facility for defence systems in Malanpur (near Gwalior) on 65 acres of land and aims to be a preferred partner for transfer of technology from global primes by setting up manufacturing facilities in India.

Punj Lloyd is a company that has been operating in India for more than 20 years. You have seen the birth of the oil and gas industry, and its growth and development. How would you say the situation is today? Where are the biggest opportunities?

India is one of the world’s largest markets after China and has the potential to become a large processing centre in the world of refining because of its strategic global positioning. Having an extremely long coastline, India has an advantage compared to other countries in terms of processing and operating cost.

India’s oil requirements are 110 million tonnes, and the country currently has a processing capacity of 150 million tonnes.

To address this, many new refineries will be built in India in the years to come, which will give Punj Lloyd opportunities to participate in oil & gas EPC projects, to the tune of $4 to $5 billion USD per refinery, depending on the size. Over the last five years we have gained sufficiently large experience in the refinery business.

Punj Lloyd is a major player in the process plant business and has to its credit prestigious projects like Hydrogen Generation and Hydrocracker Unit for Haldia Refinery, major portion of ExxonMobil Refinery, Singapore, Motor Spirit Quality Upgradation projects at IOCL’s Haldia and Barauni Refinery, Sulphur block and Utility at CPCL, Manali Refinery. Utilities and Offsites for LNG plant in Yemen, among others

How is the labour situation in India today for an EPC company like Punj Lloyd?

There is a great need for both skilled and unskilled people in the infrastructure industry today. Not just Punj Lloyd, but this need is felt across the entire construction industry.

Recognising this problem, Punj Lloyd opened Craftsmen Training Institute (CTI) in Banmore, Gwalior, India, where welders, fitters and other craftsmen get trained.

The institute upgrades workmen skills and develops diverse skill sets. On site training includes a broad range of advanced and result-oriented programmes designed for the contemporary needs of the construction industry. Our training extends to technical, behavioural, ERP and management, comprising both classroom and hands-on sessions, with performance strictly evaluated.

The trained workers from the CTI not only fulfil the requirement within the Company but also address the shortage of skilled labour in the infrastructure industry.

Punj Lloyd has recently adopted ITI (Industrial Training Institute), Narela, which is among the 14 other ITIs being run by Department of Technical Education & Vocational Training, Government of Delhi.

Spread across 5 acres, the institute has over 10000 sq. m of workshop area and currently offers industrial training in 14 different trades, with a training capacity of approx 500 trainees. Punj Lloyd is working towards the expansion and development of the institute by improving the infrastructure and adding new courses to the curriculum. 


Where is Punj Lloyd going to be focused in the years to come: on its domestic operations or its international ones?

We believe in tapping new opportunities wherever the potential lies. Punj Lloyd has a rich history of successfully executed projects in both in India and overseas. While Oil & Gas remains our core competence, we will increasingly focus on non-conventional energies like renewables.

India is a market that is still very dominated by state owned players. Punj Lloyd was listed in 2006: the company has taken steps to become an internationally focused and transparent company, as well as one committed to helping the Indian population. How do you see yourselves as a benchmark for the way that companies will be run in India in the future?

In every aspect of business, Punj Lloyd has emerged a winner. Strategic partnerships allowed the Group to explore new areas of growth. High standards of health and safety practices earned the respect of clients and a huge fleet of equipment prevented dependence on market.

Punj Lloyd remained at the forefront of technology adopting new methods of construction and delivering state of the art infrastructure.

Along the way, focus on community enrichment was entrenched into each project team. Global communities were benefitted owing to their close proximity to the Punj Lloyd project sites.

Back home, Punj Lloyd has now entered Phase III of its Life Enrichment Programme, a holistic welfare programme launched for its migrant workers at construction sites.

The programme was supported by International Finance Corporation of Washington and is now being adopted at other Punj Lloyd sites. Aimed towards enhancing the lives of workers by increasing their knowledge about HIV/AIDS, organising free medical check-up camps, providing clean water and sanitation facilities, among others, today Life Enrichment programme has been mentioned in the NACO guidelines for migrant workers and become an inspiration to other corporates.

This is an area where Punj Lloyd stands apart, and the ripple effect for a programme of this magnitude is large as the subcontracted workers are likely to work at other sites, carrying the knowledge with them and spreading it.

If we were to come back and see you in five years, what would you like to have achieved?

Although I shall probably be retired in five years time, I would like to be remembered for leaving behind a strong company, and a company which continues to grow. I am sure that many opportunities will still be there to be capitalized on.

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