company profile 29

SapuraCrests

Global Quest

Established in 1975 as a telecommunications infrastructure and service provider, the Sapura Group today has core businesses in the Oil and Gas, Secured Communications, Industrial and Automotive, and Knowledge and Education sectors. Lalita Gomez speaks to President and CEO Datuk Shahril Shamsuddin about the companys foray into oil and gas and its many successes in the industry.

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ention the name Sapura today, and one automatically thinks oil and gas. Sapura Group, through its subsidiary SapuraCrest Petroleum Berhad, is one of the leading integrated technology and service providers in the oil and gas industry. Indeed, SapuraCrests services encompass a wide range of competencies, technology know-how and expertise in fulfilling the sophisticated requirements of not only oil and gas, but also the marine and power utility industries. SapuraCrest is involved in a wide range of activities from offshore drilling and installation of pipelines and facilities, to marine services, offshore and nearshore marine engineering, the design, manufacture and operation of remoteoperated vehicles as well as maintenance activities. Equipped with the best and brightest people and providing state-of-the-art technology solutions that are engineered and developed to meet international standards, SapuraCrest is one of a very small number of companies in the AsiaPacific region with the capabilities and resources to serve upstream oil and gas
The Sapura 3000 represents ASEANs most technologically advanced deepwater capable vessel.

companies in a niche and challenging area the deepwater. Quite an accomplishment for a Group that had its beginnings in telecommunications. Datuk Shahril Shamsuddin, President and CEO of the Sapura Group, readily acknowledges the company has come a long way. We have quite a history, the Sapura Group, more than 30 years worth, he says. We started in 1975 dealing mostly with telecommunications infrastructure and manufacturing. But weve always had an eye on diversifying into areas that hold potential for further growth. Thats how weve expanded into our four main core businesses. These are Oil and Gas, Secured Communications, Industrial and Automotive and Knowledge and Education. Sapuras foray into oil and gas dates back to 1997, when a small group of young men within the Group noticed that there was no substantive oil and gas service provider managed by Malaysian professionals. They made the strategic decision to fill in this gap. Datuk Shahril was part of this enterprising group.

Our vision was to build Sapura as the preferred integrated oil and gas service company in Malaysia, then the region and globally, says Datuk Shahril, who has been described as an innovator driven by a profound passion for technology development. In order to achieve that, we knew we had to do a couple of things. One, we had to assemble a very strong management and technical team. Two, we had to invest in enabling assets to be an accredited contractor in the region. The winner of the 2009 Ernst & Young Entrepreneur of the Year Award adds: We spent two years charting a direction and creating an image from which we could grow. We began by doing small services like topside maintenance for PETRONAS. Whatever profit we made we ploughed back into the company. Our initial start-up was RM100k. Within four to five years, we were making a turnover of RM250 million. Then, in 2003, the Group acquired Crest Petroleum Bhd from the ailing Renong Group. While most people saw a company in financial trouble, Datuk Shahril identified huge potential

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advanced deepwater construction ship in the growing Asia-Pacific region. Sapura 3000 proved to be the turning point for the company, says Datuk Shahril. It was critical in our gaining a foothold in the deepwater market here in Malaysia. Needless to say, the Group did not stop with Sapura 3000. It has continued to invest more than RM2 billion in strategic assets and technology to enrich its services. At the same time, it places great emphasis on developing its people, and further expanding the Groups reputation and capabilities by entering into partnerships with worldclass foreign players. As a result of these strategic moves, SapuraCrest Groups technology and people are today recognised as being right up there with the best, not just in Malaysia, but the southern hemisphere. Acergy (an international seabed-tosurface engineering and construction contractor for the offshore oil and gas industry) approached us with an offer to buy Sapura 3000 for double the price of what we put in. Yet we declined as we felt it was an essential asset not only to the company but to Malaysia. Instead, we agreed that they could share this asset with us in return for establishing an engineering and procurement joint venture to tackle deepwater projects, says Datuk Shahril. Today we have about 150 engineers of all nationalities in Malaysia with a key KPI of developing the local engineers to gain competencies in the execution of deepwater projects. Sapura does not only focus on training its own people. The Group realises that its vendors play a substantial role in ensuring the successful implementation and completion of projects. Hence, it is committed also to the professional development of some 150-200 vendors with whom it works closely. In that sense, weve come full circle. From being nurtured by PETRONAS to becoming a stand-alone company to, now, continuing the national agenda of developing vendors under us. Vendors

Datuk Shahril Shamsuddin, President and Chief Executive Officer, Sapura Group; and Executive Vice Chairman, SapuraCrest Petroleum Berhad

in its assets, namely its people. Crest Petroleum had over the years amassed a vast team with in-depth knowledge, expertise and experience in drilling and handling large projects in the areas of pipe laying and installation. Perhaps more importantly, Crest Petroleum shared a basic core value with the Sapura Group that of building competencies within the Group to the highest level. After taking over Crest Petroleum, we leveraged ourselves to the tune of RM1.5 billion. But we were confident because we knew we were acquiring people capable of handling large and

complicated projects, says Datuk Shahril. There were no two ways about it, really. If we wanted to stay in this business, we had to start building our assets. We studied the industry, looked carefully at what was going to happen to the market in the next four years. The global trend was to go into deepwater. With the capabilities of the new team, venturing into the deep became a real possibility. All SapuraCrest needed now was the appropriate technology. This it built itself Sapura 3000 a dynamically positioned heavy lift and pipelay vessel, designed to be the most

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that will go with us into areas of nondestructive testing, welding, rigging, shore approach, etc, says Datuk Shahril. If we want to be a strong global player, then we need equally strong sub-contractors. Value chain creation has a compounding effect on the company, on the community and nation as a whole. There is no doubt that the Group has made great strides. Thus the question that begs to be asked is: what next? Now, even with a turnover of RM3.5 billion, the key issues remain the same. How do we add value? How do we increase the value chain? How do we continue to have an edge over the rest of our competitors? says Datuk Shahril. Innovation is the key. Innovation is a way of adding more value to the services and processes we provide. Innovation leads to safer methods to execute the work. In other words, innovation is crucial to building the SapuraCrest brand. The brand is developed over time. Weve earned a level of trust not just with PETRONAS but also other oil and gas players. We have the confidence and resources to guarantee our clients that we can complete the job efficiently and on time, says Datuk Shahril. The next step is regional expansion. SapuraCrest Group has already established a presence in India, Australia, Russia, Japan and part of Africa in addition to most of Southeast Asian countries. Several new contracts secured during the year have solidified its reputation overseas. This includes the Devil Creek Development Project offshore Australia and the Iwaki Platform Decommissioning Project in Japan. SapuraCrest Group has also further consolidated its presence in India with a RM255 million pipeline installation project. Going regional and global is a tough challenge. Were competing with the best of breed, companies that have been established in the market at least 30

An ROV used by SapuraCrest Group for one of the many Marine Services projects.

years before us. We may be 20 years in Malaysia, but were still the new kids on the block next to these guys, says Datuk Shahril. Its been a learning experience. Nonetheless, SapuraCrest Group is making headway inch by inch into the global market, building trust by taking on small projects and making sure they are completed regardless of the cost. Thus far, the Group has proven itself for being innovative and reliable. SapuraCrest currently holds the record for executing the deepest installation in regional waters at 1,400m. Whats more, this was accomplished by a Malaysianowned vessel. Acergy has recently merged with Subsea 7 (one of the worlds leading subsea engineering and construction companies). In their announcement, they had mentioned the joint venture between Sapura-Acergy as one of their

key strategies in Asia. To be deemed a strategic asset by a global company that is probably No. 3 in the world right now, I think that is an endorsement in itself, says Datuk Shahril. That he is pleased is evident. And he has every right to be, as the future is looking very positive for SapuraCrest. Like I said, weve come a long way while keeping to our initial objective of building local competencies that are accepted worldwide. Now, our vision of being the preferred one-stop centre in providing complete integrated services and solutions to the oil and gas industry is within reach, says Datuk Shahril.
Lalita Gomez is an environmental consultant who writes on social, corporate and green issues.