We shall minimise costs and maximise production-Total Boss
Adewale Fayemi is Total E & P’s third General Manager ever since the company started operations in Uganda in 2012. Mr. Adewale, a Nigerian, replaced Frenchman François Rafin who barely served a year. He has worked with Total E&P for 22 years. Before his appointment in Uganda, Adewale was the Managing Director of Total E&P in Ivory Coast. He spoke to Flavia Nalubega about his new deployment.
You have spent more than 20 years in Total. Tell us about that journey.
I have worked as an engineer, I have been in the upstream, engineering department, production development, operations and exploration and management roles. I have headed projects across the world, on shore, off shore and deep shore.
The experience I have brought with me spans nearly all aspects of the upstream oil and gas activities covering Health Safety and Environment (HSE), Engineering, Project Development, Operations and Exploration at various capacities in different countries and in different domains (land, swamp, offshore, deep offshore). This is what I bring with me to Uganda, to ensure that I get things moving.
Total is big. It looks at the gap (in a particular country where it operates) and then gets someone who can create a solution for the existing gap.
What do you bring to Uganda from your experience working in Ivory Coast?
In Ivory Coast, our activities are only in exploration in the deep offshore areas. There are of course a lot of initiatives in the other countries which are worth emulating; like local industry development and capacity building.
The focus should always be on how to responsibly maximise the value of the upstream in Uganda through maximisation of the reserves and lowering the cost of development and operations, amongst others. This strategy is what will ensure the maximum benefit to the country.
Synergy is key in attaining all this, it is what I want to bring to minimize costs. For instance we can work with partners for cost effectiveness, where one partner can implement one thing and us another, without repetition.
But there is already synergy reflected through the Joint Venture Partnership…
There is no limit. We are looking at the industry and the country as a whole, so we can get other players on board. The main issue is to maximise reserves at production, to bring the best and the most from the ground.
Total has also deployed new technologies in the country, for example the 3D cable-less seismic technology used for the first time onshore in Africa as well as horizontal drilling used for the first time in East Africa. In addition, we have undertaken the first best practice survey in the Murchison Falls National Park aimed at establishing baseline data for the park.
What is your plan to ensure that Total E&P receives production licenses in the shortest time possible?
The Production licenses are high on our list of priorities for the project and we will continue to engage with the Government on them. It is an interactive process which requires attention to detail considering the magnitude of this project as well as constant communication with the Ministry of Energy and Mineral Development to ensure that all inquiries pertaining to the Field Development Plans (FDPs) are addressed before production licenses are awarded.
Progress has been made and we hope to have our Field Development Plans approved and awarded production licenses soon. The oil process is a long one, the Production Licenses will be in place for 25 years therefore it is important to ensure that they have been looked at carefully because they form the basis of our work for the next two decades or more to come.
Isn’t the delay affecting your work in Uganda?
The delay is not affecting our work because we know for a country to start oil production, it takes quite some time, it is a long process. We need the authorities to do what they must do. It is not a question of whether we are going to get a production license or not, we are already part of the process. Whenever it (Production License) shall be given to us, we shall be assured of 25 years of service. But before we attain this, we must meet some prerequisites expected of us by Government, which we have been working upon.
Another licensing round is on, but Total E&P did not feature among those who showed interest, unlike Tullow. Why?
East Africa is a new frontier for Total E&P, an area of future growth to complement our spectacular deep water development program in West Africa. The acquisition of the Lake Albert fields was a turning point for our East African strategy, putting Uganda at the center. Total is always interested in new prospects whether in Uganda or around the world.
Currently, we are focusing our efforts in delivering first oil for the Lake Albert project, which is over one billion dollars in investment. This is very big, we want to first focus on this. However, we continue to keep a close eye on the sector developments in the country.
Before you arrived in Uganda, Government signed an MOU with the three JV partners to work together on, among others, the refinery and export pipeline. How do you plan to carry this forward?
A lot of work is currently being done towards analyzing the pipeline route options with the aim of developing the least cost route to transport Ugandan oil to the East African Coast. Our objective is to select a route that will result in the lowest unit transportation cost and constitutes the most viable option for the pipeline project.
Our objective is to select a route that is secure and will result in the lowest unit transportation cost to maximise the value of Uganda’s oil resources and this constitutes the most viable option for the pipeline project.
We share the view of the Government that the crude export route should be primarily selected on the basis of the least cost route. We have done all the studies and the route to Tanga is cheaper. From this perspective, Total favours the route through Tanzania to Tanga.
We have carried out all the studies and handed them to government. Government now needs to take the decision. When you have the lowest cost development, it means at the end of the day, you have a bigger pie to share
Are you are going to participate in the sourcing of the financing of the route to Tanga?
Yes, clearly, we will contribute our quota in the financing. Whatever portion it takes, Total will finance. We will be part of the consortium.
How are the low crude oil prices affecting your operations?
The Lake Albert oil project active exploration and appraisal campaign was completed at the end of 2014. The partners are now preparing for the development phase, which will ultimately lead to production. In this transition period characterized by a reduction of operations and related activities, Total has adapted to the pace of the project, while also taking into account recent trends in the international crude oil price and impact on our capital intensive industry.
Consequently, synergies with partners in terms of infrastructure and equipment have been promoted.( For instance Total is sharing infrastructure with Tullow in Buliisa District). Total E&P Uganda has also made efforts in the interim to assign some local personnel to either other Total affiliates abroad or on pertinent international training.
When launched, the development phase will have intensive resumption of activities resulting in significant manpower, goods and services demands. Currently, together with our Joint Venture Partners we are working with Government of Uganda towards finalizing the key steps that will enable us to continue the journey towards the Final Investment Decision for the project.
The availability of the necessary infrastructure to develop the oil and gas project is key in ensuring the timely execution of the project. Presently, active work is being done by Uganda national Road Authority and Ministry Of Works and Transport to upgrade or build the road network needed for the oil project. This infrastructure development will facilitate the development of the oil industry.
The development of the oil resources will also further boost the development of other sectors and industries in the country.