Afcons: A Potential Player in Offshore Oil and Gas Sector

Pramod Kumar Johri
Director - Oil and Gas, Afcons Infrastructure
Afcons has remarkably performed well with the completion of MHSR-II (A) ICPR Process Platform Project for ONGC, 2.5 KM long pipeline across the Thane creek for HPCL and NOCIL, initiating the development of Oil & Gas Fabrication Yard at Mahua, Gujarat, and acquiring many prestigious EPC projects. Pramod Kumar Johri, Director - Oil and Gas, Afcons Infrastructure, talks about Afcons’s potential, its approach to handle oil and gas activities, and more, in an exclusive interview with Sneha Sinha and Harshal Y Desai.

Were ICPR and laying pipeline across Thane creek challenging projects for Afcons? How Afcons could manage to emerge as a potential organisation for Offshore Oil and Gas operations and overcome industry challenges?
ICPR Process Platform for ONGC was certainly a crucial project for Afcons Infrastructure keeping in view the fact that it was the first of its kind project for the company. There is no denial to the reality that Afcons, when it actually bagged the project, had no experience in building offshore process Platform for oil and gas production facilities. But since the company had engaged some of the best industry experts for its execution, it could succeed in completing the project safely and smoothly. The project was a great learning experience for the company. In fact, ICPR Process Platform proved to be significant for Afcons as it could exhibit its capability in building such platforms.

Likewise, the use of 200 tonne capacity linear winch for laying the pipe by bottom pull method across Thane creek was a major challenge considering the short width of the creek. But Afcons, leveraging on the expertise and experience of its professionals, could execute the project successfully with the shore pull method, which is specifically practiced where the water is not very deep and barge cannot go near the coast. Though oil and gas operations were new for Afcons Infrastructure, the company's well-planned strategies and scientific approach helped it overcome industry challenges. Many a time, it happens that theories, during implementation or execution do not actually respond the way we expect them to. So, we always need to have fallback arrangements to cope up with these situations.

At Afcons, employees while working offshore were always aware of the challenges and were well prepared for those eventualities. I believe, it is the passion of Afcons's professionals that motivated them to undertake all the activities as a challenge and will continue to take such challenging tasks in future also.

Please brief us about the current status of the major Offshore Oil and Gas Projects of the organisation. To what extent Afcons is trying to expand its Offshore Oil and Gas business overseas?
Afcons has submitted a bid for another ONGC project recently. Besides, the orgnisation is in the process for submitting few more bids for ONGC project. We anticipate huge investment by ONGC in the next 10 years. Afcons has already selected some of the projects and started the bidding process. The ONGC has recently approved a project for building process platform in the Heera Field, which is over $ 300-million project. Afcons has decided to bid for this project. Afcons aims at bidding most of its projects in India in future. On Global level, the company is trying to expand its operations in Middle East, where huge potential lies in the field of oil and gas exploration. Some of the regions Afcons is thinking to target are Iraq, Qatar, Kuwait, Abu Dhabi and Oman. The company also plans to enter into North African region as well. Further, expanding operations in Far East countries such as Indonesia, Vietnam, etc is also a near possibility.

Afcons Infrastructure already has presence in more than 10 countries, where it is undertaking a number of projects for building ports, jetties, highway, etc. The company will try to encash its presence and make the most of opportunities in oil and gas sector as well in these countries.

Afcons has already developed joint venture partnerships with Gunanusa. How does the Indonesian firm boost Afcons Offshore Oil and Gas expertise? Is Afcons looking for such joint venture partnership with any Indian firm?
PT Gunanusa has been our partner for ICPR Process Platform Project, which was successfully completed. Afcons is also looking for other partners in order to add to its expertise in different areas in oil and gas operations. Besides Gunanusa, we have tied up with Technip. One of the Afcons's bids for ONGC's well platform was submitted along with Technip, France, which is a world leader in project management, engineering and construction for the energy sector. Afcons doesn't deny joint venture partnership with any Indian firm in future, if opportunity arises. The company is already in talks with some of the companies.

Afcons boasts of a range of plants and equipment that has played a major role in ensuring organisation's success. Now that the company has entered into the field of Offshore Oil and Gas, how has it updated its infrastructure to execute oil and gas operations since 2008? How have the responsibilities of CPE (Construction Plant & Equipment) department increased?
Afcons has got a separate Construction and Equipment Department located in Nagpur, which boasts of possessing all types of equipment for Infrastructure development. Since the organisation entered into oil and gas industry for just three year, the CPE Department for oil and gas has not blossomed so far but need to be developed in future as need arises.

What are the safety precautions, an oil and gas pipeline company needs to ensure? How is laying pipeline for Oil different from laying gas pipelines? How Afcons approaches the entire operations?
Safety in oil and gas exploration activities is a different subject altogether to study and research. It involves a number of complex engineering techniques. Every client and contractor has got his own HSE (Health, Safety and Environment) policy, which needs to be approved by the clients. Clients have their own HSE policies, which they prefer to implement by their contractors. Every activity right from the survey to commissioning of the project is governed by the safety norms. These norms need to be approved by international authorities and accredited by third party agencies . Further, there are safety-training sessions organised for the professionals, who go offshore and engage in the offshore operations. Before actually commissioning the project, a company needs to demonstrate the safety policy and guidelines.

As far as the laying of Oil & Gas pipelines is concerned there is no difference as such. However, the design aspects for both the pipeline differ from each other. Usually, carbon steel pipes are used for both Oil & Gas pipeline, which is mostly imported from specialised pipe manufactures from Europe, South America, Japan, South Korea, etc.

What are the future- plans of Afcons Infrastructure (Offshore Oil and Gas)? In the next five year, Afcons aims at accelerating its oil and gas operations. At any point of time, Afcons aims of handling two to three projects running simultaneously. However, in the future, we will try to increase the number of project running simultaneously from three and more. In the next two years under various phases, the organisation will try to boost its manpower and hire about 200 to 250 personnel. The company will strengthen its team and develop its infrastructure for oil and gas field. Joint ventures and partnerships with foreign and domestic organisation will also be a major part of our strategies.

We have projected a booking of order of Rs. 1000 crore for 2012-13, Rs. 1500 crore for 2013-14 and Rs. 2000 crore for 2014-15. Hopefully, Afcons Infrastructure will be able to meet the target.