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Manssour Jarmakani

NIGERIA - Economy

Staying Power

Group Co-CEO, Jagal

Bio

Manssour Jarmakani is a Nigerian citizen and studied at the American International School Lagos and the American Community School in Hillingdon, UK. After that, he studied Management, Marketing and IT Logistics at D’Amore-McKim School of Business at Northeastern University in Boston, US. He has been part of the leadership of Jagal since 1998. He is currently the Co-CEO of Jagal.

“Our strategy is to push for work and see if we can partner with IOCs.“

Jagal Energy is the oil and gas solutions provider of Jagal, and a prominent player in the Nigerian upstream sector. How are low oil prices affecting your operations?

Across the world, low oil prices are challenging companies to think differently, change the way they do business, and look for innovative solutions. We need to understand how to do things more economically. For our energy division, we operate as contractors and have a lot of joint ventures and strategic alliances. We experienced a decline in work and in future work on the table. Previously, we were bidding on numerous projects at the same time. Today, we have very few projects on the horizon. At Jagal Energy, we have wholly-owned indigenous companies, such as Nigerdock, and we also have partnerships like NigerStar7. We look at different sectors and try to be more efficient in our management and our supply chain, utilizing different strengths that we have across our group in an attempt to leverage them so that we can all benefit during tough times and reduce our overall cost base.

The government is working on a new petroleum regulatory framework. How do you expect this legislation to influence the future of the sector in Nigeria?

The most important legislation for the sector has been the Nigerian Content Development Act. It has made sure that companies that have capacity in-country are able to bid on and domicile supply chain, procurement, engineering, and fabrication contracts. As a result, the Petroleum Industry Bill (PIB) the government is developing has to be compatible with what Nigeria has to offer. Many companies have built up capacity across many different parts of the industry and they need to be utilized and put to work. There are many Nigerians who have high levels of competency, but we are losing them because of a lack of work. It is important that the government engage their partners in the IOCs and the local oil companies, as well as the private companies offering engineering service, supply chain, logistics, and offshore drilling support. The whole industry needs to come together, because sometimes a framework may be suitable to one aspect of the industry, but that risks losing business on other sides of the business spectrum.

What are your strategic priorities for Jagal Energy in 2016?

This year is a survival year. A lot of companies are trying to manage the downturn. Our strategy is to push for work and see if we can partner with IOCs and the NNPC to unlock projects and work together to find solutions, because it would be a shame to have such an excellent capability in-country in our sector and lose it due to lack of communication or progress on projects.

Nigerdock has invested over USD500 million to enhance the capabilities on offer that support oil and gas projects, including offshore fabrication and ship repair. What does this investment mean for Jagal?

We have been investing in our capacity for the past decade. Our shipyard is the largest facility of its kind in West Africa. It has a 25,000DWT graving dock, a 3,500DWT floating dock, multiple quayside facilities and weather-proof, multi-purpose workshops. We operate under strict guidelines on quality control and are fully certified. We are trying to attract vessels that are operating on the West African coast, not just in Nigeria. We are investing in that capacity in order to offer services to the whole Gulf of Guinea region. This is a long-term strategy and our facility is constantly being assessed in terms of quality, productivity, turnaround time for vessels, as well as rig repair and maintenance. It is one of our core businesses on Snake Island. Other business streams include Project Delivery, Offshore Fabrication, Support Base Services, and Industrial Training creating a one-stop-shop for our clients. It is a complementary part of the whole vision and is enhanced by being strategically located at the Snake Island Integrated Free Zone, which is critical to support offshore projects and the shipping industry as well.

Can you talk about the evolution for the demand for Hello Products?

Manufacturing across Nigeria has taken a hit from the foreign exchange issue. It has made access to raw materials a challenge and consequently this has had an impact on the ability to produce finished goods. The supply chain and time cycle for turning raw materials into finished goods is impacting a lot of manufacturers, and many of them have closed up shop because of that. Hello Products has been manufacturing for over 35 years. We have a range of products and most of our raw materials are locally sourced. However, we have some key ingredients that are only made in two or three places in the world. We are forced to import these raw materials. Aside from manufacturing, the cost of goods for the common Nigerian has also risen dramatically, and this is compounded by inflation and price instability. Nevertheless, we have a couple of new products in the pipeline. We are enhancing our existing product line and improving our manufacturing cycle. We are trying to reduce the cost base, and invest. With the naira you are losing value every day, so what we have to do is to reinvest in our brand and products to support our business.

What role is Jagal playing in terms of employment generation in Nigeria?

We are one of the largest employers in Nigeria. Across the entire group we employ around 10,000 people. We have a technical training center on Snake Island, and we engage a lot of the youth in training. The training center consists of workshops and machining rooms that are fully equipped with welding booths, pipe-fitting benches, lathes, milling machines, fully equipped classrooms, an ICT room and a comprehensive technical library. To date this facility has trained over 6,000 personnel in a range of skills including project management, quality, occupational health and safety, welding, fitting, painting and coating, machining, lifting, rigging, and scaffolding. We believe that there is so much talent in Nigeria that we have to unlock. However, we are restricted by the amount of work that we have at any one time. The biggest problem is that we want to retain talent and to retain them we need a backlog of work.

What are your expectations for the year ahead?

Nigeria is making difficult decisions, but they are the right ones. The government is not there to be popular. Nigeria is trying to address critical gaps in its economy. It is important to see Nigeria diversify its portfolio so that it is not reliant on just one industry. At Jagal, we engage in other forms of investment and revenue yielding businesses besides oil and gas. Jagal has made significant investments to ensure the domestication of data in Nigeria. Rack Centre, a state-of-the art, TIER III-certified data center that offers vendor-neutral colocation services has been operational since 2014. The center operates to global standards including ISO 20000, and offers energy-efficient and secure data storage. We are now providing data center services to some key international blue chip corporate organizations. Nigeria must now take the bold step of domestication of all its data in-country, a move that will be in line with the president’s economic diversification efforts. Nigeria also needs to improve its dialog with partners. After that, the tough decisions must be implemented so that we can start to see the benefit across the sectors and improvement in the investment climate. Nigeria is a country that has an incredible population, and a fantastic need for investment, innovation, technology and infrastructure, across all sectors. The banking sector has a lot to do with improving this. It is not just about big business, it is about SMEs, and this is what will drive the economy of Nigeria. Big manufacturing will create big employment, and trade around that will further create more employment. The supply chain will kick off and snowball into something else.

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