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‘Egypt is becoming an energy hub worldwide, not just in Africa’

Interview - June 12, 2019

We sit down with Said Riad, CEO of Sapesco, an Egyptian company with more than thirty years experience as a regional leader in providing the oil and gas industry with a wide range of oilfield services using state-of-the-art techniques and proven technologies. Mr Riad discusses the evolution of the energy sector in Egypt, the potential it holds for investors, as well as the services Sapesco provides to companies in the sector.



What is your current take on the ability of Egypt to take on a competitive oil and gas sector?

Let’s just say during the last couple of years there has been a revolution in the oil and gas sector in Egypt. We witnessed this in SAPESCO where we have been awarded many new contractsand obtained more market share which was reflected on the company. Once exploration and production companies start to invest, everything will start: drilling, intervention, etc. and the demand will get higher. The last couple of years were very successful, we have managed to almost double our market share and revenue.2018 was one of the most significant years in the history of SAPESCO, we managed to achieve the highest market share, highest revenue and highest value in thirty years. The political and economic stability supported us to reach this level of success after the crisis we have faced. We are one of the main companies working in the ZOHR gas field, we managed to acquire almost 50% of the commissioningservices and activities of the large gas plant that is being constructed by ENI in this project. Not only the ZOHR gas project, but we were involved in other gas projects like West Nile Delta developments by BP and we expanded our activities to the power and petrochemical sectors.


APACHE is the biggest American oil producer in Egypt. What do you think is the opportunity for American companies?

It is a huge opportunity - you can see that everyone is looking for a concession in Egypt, everyone is looking for a share in Egypt. Next year, following the gas era in Egypt, the strategy is looking for oil. Egypt is in search of oil in the Red Sea and Gulf of Suez, all companies will be looking for these new initiatives, because the next focus will be for the oil exploration besides gas discoveries. It is worth mentioning that many promising concessions have been issued in bid rounds over the last few months.


How modern and how competitive do you see the overall ecosystem and when you see all of the players and services?

Let me talk about our group of companies, SAHARA group. We are SPIC: “SAHARA for Projects and Investments”. We have six companies, one is an oil producing company “SAHARA oil and gas – SOG”, then “SAHARA Petroleum Services – SAPESCO” is the oilfield services arm, “Valve & Tools and VTCo Petroleum Services” is the drilling arm of the group. We also established an innovative chemical company “SAHARA Chemical Solutions – SCS” after achieving remarkable successes with our innovative chemical solutions. And also we have a specialized oil & gas training company “SAHARA Technical Institute – STI”.

At SAHARA group we are integrating our activities through our new approach, SAHARA Integrated, where we created a platform between our business units towards participating in turnkey projects and technology solutions across each process in the oilfield. SAPESCO is the oilfield services arm of SAHARA Integrated. It competes with multinationals and large oilfield service providers. Most of the people working here are having an international experience background, so they know how to compete in the international environment and markets.

In the last few years we have been concentrating on human development and training, because we believe developing people is important in a country with a population of more than 100 million. That is why we established SAHARA Technical institute (STI), which depends on the technical experiences we have. SAHARA Technical Institute is to serve the company first – to train the qualified people to work in the company, and to train the staff of the oil and gas fields “hands-on” training.

We had a challenge in 2015. We were in the middle of the crisis. Shell Egypt was facing problems with their gas stations in the desert.  They were suffering from scale formation in the facility and losing millions of dollars per day, because national gas companies were rejecting all the gas they produced due to the scale problem they had.

The manufacturer advised Shell to replace the gas train. It was a one-billion-dollar facility, so we had our role here, we were working to design a chemical solution and we managed through our R&D team to find the right solution that no any other company in the world could provide. Shell tried to find a solution all over the world but could not find any. Shell was impressed seeing a local Egyptian company could find the right solution. We managed to fix this problem with Shell. We saved the company one billion dollars and it was a remarkable success story. Shell named it as one of the big success stories for the year 2016. We are an Egyptian company that developed unique solutions that nobody has worldwide.


You service a lot of different segments within the entity, if not all of them. How can you build that capacity to be a one-stop shop?

Let’s talk about SAPESCO,it has been around for almost 35 years as it started in 1987 by offering few services like memory gauges and coil tubing for almost 10 years. Afterwards, we added many services. Now SAPESCO operates in seven countries and provides more than thirty services. We operate in different countries with different service lines in each location.

In Egypt we have all service lines active. In Saudi Arabia we have running contracts with ARAMCO for almost 10 years, same in Kuwait, Emirates and Libya. We have never left the Libyan market even during the tough times in the country. Now our next objective is to expand in the African region. We have people from different African countries in our training company in Egypt as we are now offering training courses to the African market. Our marketing team is traveling to five African countries to support our company expansion strategy.

We also exist now outside the region targeting international markets. SAPESCO and SAHARA Chemical Solutions now have presence in USA. We have chemical solutions that no one else has and we are aggressively promoting these solutions internationally. It is an innovation that handles very tough situations either in upstream or downstream operations through implementing advanced de-scaling solutions. We are inventing these solutions that have been approved worldwide by Texas A&M.

I worked at Halliburton for fifteen years, I know what they are doing. We at SAPESCO are moving towards them and competing with multinational companies.

Talking about American companies: we are working here with Apache where the Egyptian partner of Apache is Khalda. We have been providing oilfield services to Khalda and Apache for more than 20 years, many success stories were accomplished during that period. Now most of the services offered by SAPESCO are being utilized by Khalda. Generally speaking, we have very good history with American companies. We are now even moving to the US with our solutions – we are going to them.


What do you think is important to know about the new reality of Egypt.

Egypt is becoming an energy hub worldwide, not just in Africa. Egypt will be one of the most important countries in the world for energy, not only for oil and gas but electricity, wind energy and solar energy, everyone will be looking to invest in Egypt.