John O’Hare – General Manager Marine & Defence, Oil & Gas, Western Australia Department of Commerce, Australia
Responsible for delivery of Government resources and services to the Western Australian oil and gas services, marine and defense industry sectors, John O’Hare works with his team to attract new investments and talent to Western Australia. Sharing the unique attributes of the market, Mr. O’Hare highlights the department’s efforts to identify and bolster new business opportunities in the industry for the region.
As General Manager Marine and Defence, Oil and Gas Services for Western Australia’s Department of Commerce, could you provide a brief overview of your main responsibilities with regards to Western Australia’s oil and gas services sector?
The main priority from where we sit within the Department of Commerce Oil and Gas Services Sector is to look at where opportunities arise from the shift in capital-intensive build into the operational phase, and what this means for Western Australia and Australian suppliers. The shift is quite substantial, and many opportunities are now clearly within the operational and maintenance phase. In the shift to this phase, we are asking ourselves, where we fit within the operational phase; what capabilities we have in Western Australia, and how we make sure that these capabilities fit in with the operational frameworks of the projects.
Besides the State’s prodigious mix of energy sources, what key expertise and structural assets of Western Australia should encourage the international oil and gas industry to enforce their investments in the region?
Our expertise obviously extends itself across a number of sectors, but one area in particular in which we have had an interest for a while is the subsea sector. We have set out to become an international center of excellence in this field. Over a decade ago, the government made a commitment to set land aside in the Australian Marine Complex for companies involved in the subsea sector to base themselves. This has resulted in the State developing an experienced and competitive sector that is supplying local and international projects. It is fair to say that the subsea sector has matured in other metropolitan locations as well, but subsea opportunities in our region are particularly important, and the large number of trees and pipelines will continue to generate promising business opportunities in the years to come.
What is your main strategic approach to major oil & gas services and marine projects in Western Australia?
Western Australia maintains overseas offices promoting the capabilities of the State, as well as projects that are coming to fruition in the near future. In addition, we host a number of international delegations that come to Western Australia. In more concrete terms, in terms of oil & gas services and marine, we are a major sponsor of the Australasian Oil and Gas (AOG) Exhibition, which is the largest exhibition that takes place within Australia for the oil & gas services sector. I spoke at the international briefing for this event, enabling us to showcase to international participants what Western Australia has to offer, what we want to do in the region, and what opportunities are available here.
Our role is to demonstrate these opportunities, primarily to representatives of companies scouting for opportunities we showcase the State’s common-use infrastructure, as well as areas that we believe are of interest to these companies. We encourage the cross-fertilization of the skills that have been honed by Western Australian companies in the oil and gas industries into the defence sector. We have built up world-class companies and expertise around the oil and gas services industry, which we believe can also play a greater role in other sectors of the Australian economy. The oil and gas and defence sectors are what we would call first-class markets, markets that if you are able to service, you are very capable and have quality products and services. If you have products and services that you can sell and market to these two markets, you should be internationally competitive in a broad range of markets.
As a member of the Gorgon, Wheatstone and Browse Local Content Committees and co-chairs with Shell Australia of the Prelude Local Content Roundtable, what is your assessment of international operators’ contribution in polishing and strengthening the WA workforce’s expertise in the sector?
The Department truly appreciates the work that is done by the local content committees. They are a mechanism by which we can engage with the operator and ascertain where Western Australia has competitive skills, or on the other hand assess how we can cover some workforce gaps. One key point of focus is Shell’s Floating Prelude project. Together with the operator, we believe that we can build Western Australia’s capacity to be a world class center in FLNG knowledge.
Our hope is to broaden what we are working on in terms of the definition of local content. One of the benefits is upscaling Australians so that they can have skills that are internationally transferrable. This includes education, training, as well as academia where Western Australian universities can develop centres of knowledge where companies can go to solve not just Australian problems, but problems that may be faced in other fields and jurisdictions. Scotland and Norway have both proven to be examples of this model, and this is something that is important to us here as well. It is our priority to make sure that these opportunities flow into broader sections of the industry, particularly where people think of only fabrication and construction.
Local industry development is a high priority for the State Government as a key determinant of the current and future performance of the Western Australian economy. What actions are you concretely undertaking to foster the growth of local businesses and strengthening Perth’s positioning as an international hub of innovative companies?
The oil and gas services industry in particular has encouraged the growth of internationally competitive Western Australian companies as they service those markets. The issue for us now is to work with companies and operators as we transition from construction to operational phases to make sure that we maximize the benefits for Australians, and in particular Western Australian companies. We want to be sure that what we develop in Australia can also be of use internationally and ensure local companies can partner with international operators to access global supply chains.
Hence, we are particularly happy about the decision to headquarter the National Energy Resources Australia (NERA) in Perth. This agency will be a key stakeholder in this endeavor, and we will work together with NERA to guide local suppliers and companies to access global supply chains. We will also jointly look at what research or initiatives can be specifically undertaken to sharpen our local expertise and foster a competitive and technologically advanced oil and gas business.
Europe, and particularly Africa, seem particularly promising as destinations to further export Western Australian expertise. How are you fostering the emerging relationships between WA and the two continents?
In conjunction with the State’s European office, we have been participants in Offshore Europe in Aberdeen and Offshore Northern Seas in Stavanger, where we have worked together with Western Australian companies to do business in these markets. These are mature markets, but at the same time, they are leading markets. So while we have a large focus on Southeast Asia given our proximity, we do not underestimate both the opportunities in Europe as well as Europe’s history in the industry considering how many companies consider the region as their home base. In this regard, Europe is still a very important market for Western Australia in the oil and gas services markets.
As far as Africa is concerned, we have looked at East Africa in particular, and we see some synergies there with other developing markets in the region. What we would like to promote in the region is Western Australia’s success, primarily in our mining services industry, considering approximately 300 Australian companies have followed exploration companies to the region.
What are some of your priorities for the region moving forward?
The priority for us is looking into opportunities at the operation phase. To do this, we plan to work very closely with NERA, particularly in reviewing global supply chains and conducting research. We also anticipate to work within the industry to achieve greater collaboration, an effort that in these challenging times is needed more than ever. In order to ensure that the Western Australian oil and gas services sector remains internationally competitive, we need to foster greater linkages among operators, SMEs, product leaders, contractors and other service providers to enhance our productivity.