Allwood – Managing Partner, Global Consulting Solutions at KBC Advanced Technologies, Malaysia
Jon Allwood, Managing Partner – Global Consulting Solutions at KBC Advanced Technologies, explains why KBC recently opened an office in Kuala Lumpur, the company’s long-standing relationship with PETRONAS via such joint projects as theOperational Excellence Academy, and KBC’s holistic offering across the value chain, from its recognized position as the downstream performance improvement consultants to your more recent push into the upstream sector via strategic acquisitions of Infochem and FEESA.
KBC Advanced Technologies opened an office in Kuala Lumpur in 2013. How has your presence in Malaysia evolved, and what is the current importance of Malaysia in the Group’s global and regional portfolio?
KBC Advanced Technologies has been working in Malaysia for over ten years, and I have been with the group locally since 2005. Recognizing that Malaysia is fast becoming a regional oil and gas hub, and in line KBC’s strategy of making our clients world-class in terms of Operational Excellence and profitability, we decided to set up a local office in 2013 to support this ambition. KBC is focused on expanding our level of capability in Malaysia, all the while strengthening our expansive collaboration with PETRONAS and in the process fostering our relationships.
On a global scale, KBC has selected three key geographies as being strategically important, one of which is Southeast Asia. The company is thus investing resources to build and develop our presence locally. Being already well established in several Asian countries, Malaysia is now positioned as a strong growth market within the region and within the group’s operations. Within the larger region, an Australia office was also recently launched, based upon the several successful projects.
Steven Kantorowicz of KBC Singapore told us that “KBC is perfectly positioned to partner with the Asian NOCs to support and accelerate the development of their downstream capabilities.” How has KBC Malaysia cultivated its relationship with PETRONAS?
KBC has cultivated a long-standing relationship with PETRONAS, which has allowed us to demonstrate the value in partnering with KBC. One of our key partnerships is with PETRONAS’s Group Operational Excellence group, for whom we have established an Operational Excellence Academy. The Academy’s courses blended design, encompasses both formal training, plant application and delivering results through a defined project.
Among many other collaborations, KBC has completed several value improvement and product maximization projects focusing on improving plant margins by increasing revenue from improved yield. All the projects for PETRONAS resulted in significant value being delivered in the millions through both energy and process optimization.
KBC Advanced Technologies is a well-established downstream player but has now undertaken a shift to also cover the upstream sector. Can you offer more information on this strategic evolution of your service offering?
KBC has indeed built our foundations in the downstream segment, being recognized as the downstream performance improvement consultants. KBC’s activities are always centered around hydrocarbons, and the move into upstream seemed a logical step. Having been involved in the upstream area over the last ten years, KBC now has a clear five year plan to now move more aggressively in this sector.
Two recent acquisitions have supported this ambition, namely that of Infochem in 2012, and of FEESA in 2014. KBC is also looking into further acquisitions, and part of my responsibility is to determine which acquisitions across the entire value chain and consulting suite would allow us to best develop our product lines. Previously, we had looked mainly at process additions and are now moving into the other disciplines of our group, such as operational excellence and asset reliability.
However, this expansion of our service offering is a careful and concerted effort. At KBC, we are very proud of our reputation and brand. People respect KBC because of the quality that we promise to deliver. Our plan is to slowly build our capability and gain success stories to grow with true capacity and true delivery capability. Finally, building our Malaysian presence goes hand in hand with building our upstream capacities.
How are you positioning KBC Advanced Technologies in Malaysia as an integrated services provider, rather than simply a provider of software?
KBC’s advanced IP offering, particularly the unique dynamic modeling tool Petro-SIM, provides the technology backbone to support our clients. The key to KBC’s success, however, is the consulting side of our business, as our consultants provide the insights to bring to fruition the full benefits of our software platforms. A recent independent market survey found that respondents perceived KBC as “thinking like an operator.” Such an opinion is critical, as it shows our clients recognize the value we offer. KBC’s true value comes from our people – our consultants are industry experts with at least 15 years industry experience and possess the front line view necessary to practically and sustainably accompany clients.
In fact, our clients benefit from both our market-leading technology and the associated consulting expertise to most effectively optimize processes. KBC works with clients for both short, mid, and long term outlooks for projects, supported by forecasts from our energy economics team. Furthermore, we can provide expertise to clients from large integrated projects to maximize returns to smaller focused projects. In all these projects, our consultants are able pull through how specific improvements will move a client forward and concretely collaborate with clients to make step changes, rather than simply advise from afar. For example, our consultants can examine a company’s asset strategy and work to optimize facilities accordingly, based upon both the input from our software platforms and the consultant’s industry expertise. Overall, our consultants work to educate clients and aid them in building their own internal capability around our delivery platform.
The oil price has changed drastically over the last eight months – how has this change in commodity prices impacted your business along the value chain from upstream to petrochemicals?
With oil and gas transportation and processing facing increasingly more complex technological, environmental and economic challenges, operators and engineering companies are being forced to find cost-effective solutions to designing and operating transportation systems, hydrocarbon processing and conversion facilities.
KBC is uniquely positioned to help companies optimize these facilities at all stages of the facilities life, thus minimizing Operational Expenses (OpEx)/ Capital Expenditure (CapEx) and improving operating efficiencies and safety through our “Facility Life Cycle” (FLC) approach. KBC delivers results through a combination of our expertise in a wide range of engineering disciplines with advanced technologies and intellectual property such as experience based“Communities of Practice” (COPs), deep molecular understanding and fundamental kinetic modelling based process simulation.
KBC has a unique blend of talent, operating experience and organizational transformation capabilities to provide a full spectrum of consulting services to our clients, including strategic investment support, economic analysis, asset reliability, energy and process optimization, operational planning and sustainable workforce capability. Together with our market-leading software solutions and intellectual property, clients can realize significant profit improvement by a thorough understanding of all aspects of an asset’s actual performance relative to its “Maximum Achievable Potential” (MAP).
How far is Malaysia from reaching its oil and gas hub status as per the Economic Transformation Program?
Malaysia is a great market with clear potential. In terms of upstream, the more aggressive terms of contracts for PSCs and RSCs is an important opening in the market, while the education standard is improving and more qualified local talent is being formed. The political context does pose some difficulties, especially given the recent oil price drop that has removed guaranteed income from the government for this year. However, if Malaysia continues to be open to partnerships, encourages investment, and remains transparent, I believe the country is on the right path for their 2020 vision.
KBC is keen to contribute to Malaysia’s oil and gas hub ambitions. On the one hand, we hope to add value via our relationships with key players and our performance optimization services. At the same time, we are also looking to develop local content and talent. One of our key strategies is to build our resource base in Malaysia, which will contribute both to Malaysia’s Oil & Gas hub status and also aid our global operations as the transferability of Malaysian talent is very high.
How will KBC further grow and consolidate its position in the Malaysian market over the next five years?
Our ambitions for Malaysia are for the long-term. Thanks to our physical presence here in Malaysia, we are able to improve our partnership process with key clients. I am personally focused on growing the company and evolving a strong platform of projects and partnerships. In particular, we hope to further deepen our already robust relationship with PETRONAS via more joint projects in the areas of operational excellence, value improvement, and performance improvement.
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