Helium, human resource and cross-border logistics have been in the spotlight on the final day of gasworld’s 2017 MENA Conference, as the curtain falls on the company’s 6th event to be held in the Middle East.
Hosted at the striking Jumeirah Beach Hotel in Dubai, situated in the pristine shores of the Arabian Gulf, over 270 delegates from 40 countries have experienced a cutting-edge agenda over the past two days, with engaging speeches from industry insiders and 44 promotional booths on display.
Whilst day one of the conference set the theme with strategic partnerships in innovation, with a nod to improving safety, day two explored some of the hot topics in the Middle East industrial gas market and gave advice on accelerating performance.
While in the Middle East, the MENA conference addressed the crucial topic of the uncertainty surrounding global helium supply and the effects of the Saudi-led Qatar blockade. gasworld welcomed esteemed industry expert Phil Kornbluth from Kornbluth Helium Consulting, LLC to speak about the future implications of these recent events on the market.
Qatar is the world’s second largest producer after the US, however 30% of the world’s capacity was removed from the market for three weeks when an embargo was announced on the 5th June by Saudi Arabian-led group of countries. This had the greatest impact on direct purchasers of helium from Qatar – Air Liquide, Linde and Iwatani.
Kornbluth said, ”After the embargo was put in place, neighbouring countries like Iran and Turkey provided support to Qatar, enabling them to mitigate some of the embargo impacts.” He continued, “It was a three-week shut-down, it was a complete surprise and there was no opportunity to prepare in advance – it was a big logistics problem.”
The embargo has had a lasting impact on helium markets – new logistics have caused longer supply chains and increased shipping costs. Despite this, Kornbluth explains that helium markets should be relatively normal by the end of September.
He said, ”The market should be returning to a ’new normal’, but it will be a little more difficult than before. The new normal takes longer and costs more due to a longer supply chain. You need about six empty tanks a day to sustain the full production of the two Qatar tanks and the shipment to and from Ras Laffan.”
However, Kornbluth urged, that the Qatar embargo should be a reminder of the importance of having a diverse supply portfolio and that the helium industry needs to pay increased attention to risk management and contingency planning moving forward.
He expalined, ”One thing I’ve been saying and repeating for the many years I’ve been in this business is that, it was easy, in that the helium pipeline, the stockpile, and the half a dozen plants linked to that system gave the industry some flexibility. If a plant went down somewhere it was easier to manage. The global supply change is more fragile and inflexible now – It’s much harder to flex production.”
“It’s better to have a portfolio of sources so you’ve got a back-up, if yours goes down you can turn to someone else. Contingency planning and risk management is something worth considering,” he added.
To conclude his presentation, Kornbluth covered other major affairs in the helium business. In particular, he discussed the impact of the Praxair-Linde merger on the helium market and Gazprom’s Amur Project.
This was followed by a presentation dedicated to Morocco and North Africa given by Laila Benali, Financial and Administration Director of Maghreb Oxygène. Benali began by providing an introduction to Morocco’s infrastructure, economy and industrial gas market.
Morocco ranks No.4 in MENA and No.68 in the world, out of a total of 190 countries. The country’s key sectors include agriculture, tourism, aerospace, automotive, phosphates, textiles, apparel, and sub-components. Today, Morocco’s gas market has around eight key players and is dominated primarily by traditional cylinders and bulk supply.
Benali said, “The main challenge is the structure of the Moroccan company. It is orientated by small and medium companies; the economy is very dependent on rainfall, and the closed boarder makes it difficult to build relationships with neighboring countries.”
Benali went on to talk about Akwa Group, a company of Maghreb Oxygène, which Benali claims to be an undisputed Moroccan energy leader, turning over $3bn in 2016. The company has a significant track record in terms of partnerships with both national companies and renowned international groups.
She said, “The most important synergies we get from being part of the Akwa Group is the transport synergies, they have the biggest fleet in Morocco and expertise in transport regulation and transportation of dangerous products.” She continued, “We can also negotiate the lowest rates and make them comply to all the companies within the group.”
Towards the end of her talk, Benali went on to explain how to achieve success through partnerships, including the importance of developing technological expertise, improving sourcing and supplying, and expanding outside of Morocco.
She explained, “We can develop technological expertise through partnership. We need our suppliers to share their know how and best practices, and open their doors to us to show us there facilities – we can learn from them.
“Partnerships can also help improve security and supply. Because we import many of the products we sell, we place a lot of importance on picking our suppliers, ones that are reliable. We trust them to provide a consistent delivery with set prices, volumes and quality.”
Matthieu Giard, Air Liquide’s Executive Vice-President Africa, Middle East and India, was next up to discuss Geographic Partnerships and Development.
He began by taking the audience through a timeline of challenegs faced by the Middle East market over the years. He said, “It is a fragmented market with many players, an immature regulatory framework, a challenging network where it takes a long time to build trust and relationship longevity due to turnover.” He continued, ”In 2006, there was a rapid boom in the region, since then, the region has changed a lot, there was the financial crisis in 2008; in 2011 there was the Arab Spring; the collapse of the oil market in 2014, and today, the new normal.”
In regard to innovative partnerships, Giard stated, ”In the region, you must deal with joint ventures – The choice of your partner is key, and the eco system and client are crucial to the success of a company.”
The conference concluded with Session Four, focusing on Other Essential Partnerships and, in many respects, the practicalities of doing business and partnering for success in the MENA region. This comprised of Heidrick & Struggles’ Partners Naji Skaf and Dr. Markus Wiesner, who presented on The Importance of Human Capital and Cross-Border Logistics presented by John Gould (Independent).
Skaf and Wiesner were first up, sharing their knowledge on accelerating performance and using elite organisations as a point of reference.
Wiesner explained the 13 ‘drag and drive’ factors that impact an organisations rate of success. These factors cab be reduced into four categories, mobilise, execute, transform and agility.
Wiesner urges organisations to become distinguished for their investment in people. He advises companies to reduce layers, celebrate net exporters of talent and build winning teams. The five fundamentals of a successful organisation are:
John Gould, (Independent), stepped up to explain the importance of cross-border logistics and touched on key issues such as road safety.
He explained, “One of the key issues in road safety is rollover mitigation. To avoid this issue, you should conduct driver health monitoring and maintenance, vehicle health monitoring and maintenance, training recertification, route planning and alerts.”
Gould concluded with a forecast for MENA based on his personal thoughts and opinions. He foresees government subsidies to decline, cost of Saudi Diesel to increase from $0.12/litre to around $0.50/litre, and road user charges to be implemented.
He predicts that infrastructure will improve; greater focus will be placed on the King Abdullah Port; roads will be developed further and GCC Rail network re-forecast for 2021 will be a ‘game changer’.
Gould also went on to add that, “Governments will continue to provide for their local industries, the North Africa market will continue to be splintered and telematics will become mandatory, although they are always essentially mandatory in the UAE.”
After a delicious celebratory lunch sponsored by Herose GmbH, commemorating gasworld’s 10 years of global industrial gas events, the final session of the conference concluded with exhibition time and a few parting words from John Raquet to bring the curtain down on the event, he concluded, “I’m going to bring the MENA 2017 conference to an end now. But firstly, I would like to thank you all for being here and listening to the fantastic presentations which have been running over the past two days.”
“We look forward to your feedback – what you want to hear and what you want to learn about in the future. So, if you have any ideas we would love to hear them.”
“We are simply a catalyst, we just want to bring you together. What you do when your together is up to you. You can share experiences, do business, and go back to where you are from hopefully richer in knowledge, richer in contacts and richer in business.”
“Lastly, I’d like to thank my team – they are the ones who put this all together.”
“I wish you all a very safe journey home.”
Follow the conference
Stay up-to-date with all the latest news, views and developments at MENA conference via the gasworld website, updated throughout the event.
A full review of the conference will be published in the upcoming November edition of the gasworld magazine.