Martin Grant, Chief Executive Officer for Energy, Atkins, UK
The Chief Executive Officer for Energy at Atkins speaks about the company’s long corridor approach for business, several recent oil and gas service agreements, and the human resources challenged faced by players in the market.
In 2011, Atkins acquired Pöyry’s oil and gas business. What has this acquisition brought to your capabilities in the UK?
There were a number of reasons for pursuing the Pöyry oil and gas acquisition. First and foremost, it strengthened our skills in conceptual and front-end design, especially on the process side. When combined with our existing expertise in subsea, structural and safety engineering, this afforded us a much more integrated design capability. The acquisition also gave us a footprint in regions where we hadn’t been especially active such as Australia and Norway.
This year Atkins has been very successful in securing oil and gas service agreements. Recent contracts have been concluded with Nexen, Statoil, Maersk and BP. What are the factors that led to winning these contracts?
We possess a broader service capability than many of our competitors and this has enabled us to attract a lot of business. Clients are attracted to the convenience of a ‘one stop shop’ so long as everything they buy in that shop is of high quality. Atkins understands this and combines top quality offerings across the engineering spectrum into a single package for its clients.
Having a greater geographical spread than many other companies also helps us to secure the most important contracts. This is because the larger international oil companies increasingly prefer to deal with the same service supplier across the globe so as to ensure consistency of standards and technical approach. This is especially the case with the super majors.
Back in 2008, you told us that the company would be expanding its activities globally using what you called the ‘long corridor’ approach, which essentially meant developing the capability to support clients anywhere from a distance without necessarily having to maintain a constant physical presence. Does that approach still hold true today?
Many things have changed since 2008, but that particular element of the Atkins strategy has proved to be both durable and highly successful. Oil and gas is an international industry. Certain services need to be offered in a specific location so companies like Atkins do need to maintain a permanent presence in multiple locations simultaneously. However, we not only offer our clients a local presence, but also an entire network of experts from across the globe.
The ‘long corridor’ approach basically brings an additional dimension into the mix. Atkins informs its clients that, irrespective of where they are, we will have an office nearby and through that office they will gain access to the very best skills that the industry has to offer. Those skills may be anywhere in the world, but Atkins can deliver them via the ‘long corridor’. For example, we have delivered support on structural engineering to clients in Australia from our office in Aberdeen because of the very well regarded expertise available in this town.
Because many oil and gas companies have undertaken significant investments and are keen to secure the very best expertise for their projects, they find the ‘long corridor’ approach attractive. As always, when a customer buys a product that comes from far away, there has to be complete trust between the customer and the service provider. Atkins has been building up this trust over time and has become renowned for its integrity and reliability.
For what type of services do you see most demand in Aberdeen?
Firstly there’s a great desire to keep existing assets operating longer. There is still plenty of oil on the UKCS and, although getting it out will require some investment in new facilities, the primary part of the extractive process will involve mobilising the infrastructure currently in place. This means that many existing facilities will be required to operate significantly beyond their original design lives. This translates into a demand for expertise on making judgements on the safety of existing installations and on how to prolong facility lifespan without compromising safety. Aberdeen is thus fast becoming a centre of expertise on facility maintenance.
Secondly there’s massive demand for innovative and imaginative solutions for mature field development. Much of the low hanging fruit has already been gathered and applying the traditional techniques to North Sea hydrocarbon accumulations that are marginal or technically difficult would not be economically viable. Instead there is a need for innovative approaches and novel technologies.
Atkins already possesses an excellent track record in devising imaginative solutions. One example would be the conversion of the long-dormant Solan field into production development. Atkins’ contribution was to work on a series of solutions including subsea storage that offered significant cost savings over a more conventional approach and avoided the need to construct an expensive submarine pipeline.
Last year Atkins formed a joint venture with Areva for decommissioning in the nuclear industry. To what extent can one industry inform the other?
Nuclear decommissioning represents a big market for Atkins. The oil and gas industry can certainly learn from the experiences of nuclear decommissioning. There are technological lessons in which exchange on engineering practice could prove useful. More importantly, the nuclear industry has a great track record in establishing collaborative joint ventures in response to specific problems. The oil and gas industry by contrast seems less enthusiastic about such coordination. Sir Ian Wood’s report has already called for much greater cooperation within the industry and for government to take on a stronger stance in driving and fostering that collaboration.
Many companies have been experiencing human resources challenges. What is Atkins’ strategy to attract and retain skilled labour?
Recruitment has to happen across the board and there’s no single silver bullet to resolve the resourcing issue. Underpinning our human resources strategy is a strong commitment to graduate recruitment and bringing young people into the industry. We have been doing this year on year irrespective of the overall performance of the industry.
Meanwhile, Atkins seeks to attract and retain experienced personnel by offering individuals the freedom to express themselves as technical experts and to pursue interesting lines of technical enquiry. We also try to map out the next one to three years for each employee so they know in advance which exciting projects they’ll be assigned to. This tends to motivate and engage our staff.
As an industry, we need to collectively bring new people in from other industries and train them up. If all we’re doing is moving individuals around within the industry, it becomes a zero sum game and we’re not creating any new value. At Atkins, we have set up an in-house training academy dedicated to bringing in engineers from alternative industries such as aerospace, nuclear and automotive. The laws of physics don’t change when you come into the oil and gas industry and the fundamentals remain the same. What we do is furnish them with the language and vocabulary that works in oil and gas. We explain how our industry works and how it communicates.
There are companies out there that are turning over many billions, but plead poverty when it comes to investing in training new workers. I personally find that scandalous. The industry as a whole must do much more and it should do so in a coordinated fashion. I am confident, however, that Atkins already does more than its fair share when it comes to bringing talent into the industry, and in the future we intend to do even more.
Next year you will be entering your fourth decade with Atkins. How have the company culture and ethos evolved over that time?
The culture hasn’t really changed. Even if I wanted to change it, I couldn’t do so because it is a culture that is owned and perpetuated by the staff as a whole. This year the company celebrated its 75th anniversary and remains very much true to its original values. Sir William Atkins used to declare his intention to ‘surround himself with young uncluttered minds’. With our reputation for innovation and the freedom we afford to our engineers to express themselves technically, this statement seems equally appropriate today.