Presentation July 13th Doha Qatar
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Transcript of Presentation July 13th Doha Qatar
1
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges
Gas Based Projects Development Issues
in
Qatar
2
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges Overview
• The Project Development cycle in Qatar has always represented a challenging
experience for foreign operators regardless of their size and international
experience
• Throughout Qatar’ history of gas based project development (from the mid
80’s till today ) we can identify a number of key issues around which successes
or failures have developed
•These key issues have been evolving in number, complexity and content over
time in parallel with the market’, the country’ and the organizational/cultural
development of QP
•Key Issues not only have exerted influences over the PDC but also over each
other in a complex net of interactions
3
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The Old Challenges (mid 80’s) Key Issues
Cultural
(Individuals
&
Corporate)
Political
Organizational
Execution
Project
Development
Cycle
4
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The Old Challenges Key Issues
Cultural (Individuals & Corporate) :
1. Individuals Business Mentality (stemming from Cultural Background)
2. QP Corporate Culture (challenge of definition)
Political:
1. How the political power influences strategic decisions in the Energy Industry
2. Potential Influences over the Project Execution
Organizational:
1. How the QP organization works. The realities behind the Organization Chart
2. How the Internal balances of power can influence the Decision Making Process.
5
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The Old Challenges Key Issues
Execution: 1. Matching plans with the industrial reality of the country (poor integrated
industrial infrastructures, lack of local contracting expertise, suppliers),
QUALITATIVE ISSUE
6
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New Challenges (mid 2000’s) Key Issues
Organizational
Cultural
Individuals
Cultural
Corporate
Execution
Strategic
Project
Development
Cycle
Market-Domestic
Market-External
7
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New Challenges Key Issues
Unchanged
• Cultural (Individuals)
• Organizational
Evolved in Complexity
• Cultural (Corporate)
• Execution into Market Domestic & Market External issues
Evolved in Content
• Political into Strategic issues
8
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New Challenges Key Issues
Market Domestic:
• Local contracting resources. Evolution from QUALITATIVE to
QUANTITATIVE issue.
• Market Demand vs. Offer in the engineering & construction market in
Qatar. Competing Developments.
Market External:
• The worldwide Engineering & Construction market Players (EPC
contractors) evolution
• The Market Demand vs. Offer in the engineering & construction market
(GCC countries). Competing Developments.
• The worldwide materials situation
9
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New Challenges Key Issues
Political issue have disappeared thanks to:
• Country established long terms strategic guidelines in the Gas Industry
• Isolation of QP from “non energy industry” related political influences
It has however evolved into a Strategic issue which can represent a Powerful
Tools in tackling Market Domestic & Market External issues
10
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges What the Past Teaches – The Common Approach Factors
From an attentive analysis of the past projects, we can
individuate some “commonalities” in the approach taken
by the successful project developer, these are:
1. Recognition & Acceptance of the existence of key issues
typical to the market
2. Development of an Understanding of the same and of the
impacts on the PDC & PDS
3. Capability to successfully negotiate/mediate acceptable
solutions to meet the ultimate PDC objectives
4. Flexibility of approach, Open Mind
11
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges The Common Factors of Past Successes - 3 Critical Steps
12
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges The Dynamics of the Approach to Key Issues Tackling
K.M.A.D.
Understand
through
ANALYSIS
Harmonize
through
DEVELOPMENT
of an
APPROACH STRATEGY
Recognize
through
KNOWLEDGE GATHERING
&
MONITORING
13
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges The Dynamics of the approach to Key Issues Tackling
K.M.A.D.
Recognize
Understand
Harmonize
Knowledge Gathering & Monitoring •Key Issues
•Trends
•Changes
•Others’ Experiences
Analyze •Impacts on PDC & PDS
•Others’ Successes & Mistakes
Develop Approach Strategy
• To Harmonize Objectives with Realities
14
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges
The KEY ISSUES INFLUENCE Areas Matrix®
Issue/PDC
Milestones
Feed-Stock
Agreement
DPSA/JV
Agreement
Marketing
Agreement
PES
Development
Bid/s
Development
Cultural
(Individual) X
Cultural
(Corporate) X
Market
(Domestic) X
Market
(External) X X
Strategic X X
Organizational X
15
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges KII Matrix® - PDC Areas Analysis
Issue/PDC
Milestones
Feed-Stock
Agreement
DPSA/JV
Agreement
Marketing
Agreement PES Development
Bid/s
Development
Cultural
(Individual)
Pricing
Escalation
Capex
Penalties
PDP
Interfaces
Approvals
Pricing
Fees
Partners
Rights
Interfaces
Licensors
Risk Sharing
LLI Strategy
Contractual
Scheme
Contract T & C
Sole Sourced
Items & Services
Cycle
Leadership
PQR
Bid Slate
Risk Balance
Eval. Criteria
Procedure
Evaluation
Negotiation
Strategy
Selection
Approval
Cultural
(Corporate)
Market
(Domestic)
Market
(External)
Strategic
Organizational
16
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges KII Matrix® - Issues Analysis
Issue/PDC
Milestones
Feedstock
Agreement
DPSA/JV
Agreement
Marketing
Agreement
PES
Development
Bid/s
Development
Cultural
(Individual)
Value of Personal Relationships, Family Ties
Creation of Internal Alliances
Cultural
(Corporate)
Entrepreneurial mark
Strategically Focused
Prideful
Exercise Control
Conservative toward innovative solutions, operates by Benchmarking
Strong drive toward maintaining competitive environment
Market
(Domestic)
Previously negotiated agreements
(Benchmarks)
Contracting resources
(Construction)
Market Demand (Qatar),
Competing Development
E&C Market Evolution (Qatar)
Previous Execution Schemes
(Benchmarking)
17
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges KII Matrix® - Issues Analysis
Issue/PDC
Milestones
Feedstock
Agreement
DPSA/JV
Agreement
Marketing
Agreement
PES
Development
Bid/s
Development
Market
(External)
E&C Market Evolution
Market Demand, Competing
Development (GCC)
Material Market
Strategic
Gas Resources
Exploitation =
Primary
Strategy
Bi-
Polarization of
Producers in
LNG
Organizational A 5 families business (Jaida, Emadi, Kaabi, Attiyah, Suwaidi)
Other Power Lines behind the Organization Chart
18
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges Support Areas – K.M.A.D.
•As the PDC progresses into the execution phase Areas of
Influences of Critical Issues stack-up
Knowledge Gathering &
Monitoring Analyze Develop Approach Strategy
Key Issues Impacts on PDC & PES Harmonize Objectives with
Realities
Trends Others’ Experiences
Changes
Others’ Experiences
19
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges Support Areas – K.M.A.D.
Knowledge
Gathering &
Monitoring
(KG-M)
Analyze
(A)
Develop Approach
Strategy
(DAS)
Cultural
(Individual) KG A RB (Relat. Bldg.)
Cultural
(Corporate) KG A DAS
Market
(Domestic) KG-M A DAS
Market
(External) M A DAS
Strategic KG A DAS
Organizational KG-M A DAS-RB
20
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges Outputs (Typical)
Contracting Strategy
Analysis
Negotiation
Strategy
Development
PQR-Evaluation Criteria
Development-Analysis
Impact
Analysis
Competing
Development
Monitoring
Organizational
Development
Monitoring &
Analysis
Contracting
Environment
Monitoring, Sensing &
Analysis
Past
Development
Analysis
Relationship
Building Support
21
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges A Good Blend of Experiences, Expertise & Relationships
Local Relationships
Past Direct Involvement in
Manufacturing, Technology, EPC
Established Relationships
in the Industry
Long time presence
in the market (past 24-30 years)
Multicultural
22
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges The Learning Curve’ Time - Cost Diagram
Potential $
impact
of
Un-Informed
Decisions
PDC – Time
Completion Low
High
Start
DPSA (including PDP) or PES on JV
MOU
Marketing Agreement
Feedstock
Construction
H.R.D. = High Risk Decision
HRD Gap
23
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges Conclusions
• Gas Based Projects Development in Qatar presents a set of Peculiar Issues
which heavily influences the PDC & PES.
• Recognition, Knowledge, Consideration & Analysis & of these Issues
have made the difference between successful & sour projects. This area is
where H can provide support to tackle the challenges ahead.
• The Measure of Success has been proved to be:
How Timely & Painlessly We Achieve Project Objectives
• Recognizing that eventually we will get there anyway……….
24
H
Bridging Corporate’ Cultures, Processes & Executives in the Energy Industry
The New & The Old Challenges
Thank You