GE’s Localization in Oil & Gas Fuels Economic Growth in MENA, Turkey
The oil and gas industry is always a sector in flux, given the cyclical nature of supply and demand. But the steep drop in oil prices that began in 2014 and the limited recovery in prices we see today is speeding development of deeper structural changes involving localization and digitization.
Localization is transforming how producers and oil services companies are operating around the world. Increasingly, value-add is generated in the same country where the hydrocarbon resource is based.
For its part, digitization is bringing to the oil and gas industry the power of the Industrial Internet – which represents how large and complex equipment and systems are being connected with sensors, data analytics and software. In this way, operators are gaining a whole new level of insight into plants and systems that help them make decisions that can improve production and lower costs.
GE broadly, and GE Oil & Gas in particular, have evolved in tune with – and even ahead of – these changes.
For example, in digitization, GE is transforming itself into a digital industrial company. Not only does it intend to be a top 10 global software developer by 2020, but it also has developed Predix, the world’s first cloud-based operating system for industry. GE Oil & Gas and its customers are already leveraging the power of the Industrial Internet to reduce downtime and optimize performance.
In this region, the first example of such an implementation is a GE Oil & Gas Digital solution that represents a collaboration between GE and Saudi Aramco. The project will see a GE Asset Performance Management solution reside on Saudi Aramco’s business network for the Aramco Jazan Complex Integrated Manufacturing Operations Management System (IMOMS).
A second major structural change alongside digitization that is helping address today’s industry challenges is localization. GE has been an early proponent of localization, realizing the win-win benefits it brings to both GE and the local markets it serves. As GE’s business has become increasingly international – today more than 70% of revenue comes from outside the United States, compared with just 20% in 1982 – it makes increasing commercial sense to locate more of its manufacturing, training and repair operations in those markets.
This opens up business opportunities for GE and helps the company more quickly and efficiently serve its customers. In addition, localization brings benefits to the local economies through technology transfer, working to raise manufacturing standards across the local supply chain, and creating new, higher-skilled jobs for local workers.
In the oil and gas industry, localization also involves GE supporting the development of downstream, value-adding industries such as petrochemicals and refining.
GE Oil & Gas has been deepening its localization and in-country value programs in the region for decades, such that now, across the Middle East, North Africa and Turkey region (MENAT), there are more than 1,800 GE Oil & Gas employees and more than 20 GE Oil & Gas facilities.
Just a few examples of these facilities include the GE Oil & Gas Measurement Solutions Calibration Lab in the CERT Technology Park in Abu Dhabi; the GE Oil & Gas Manufacturing Facility in Dammam; the GE Saudi Technology & Innovation Center in the Dhahran Techno-Valley that will develop software solutions in a range of sectors, including oil and gas; and two joint ventures with Al Shaheen Energy Services, a Qatar Petroleum company, covering pipeline solutions, and repair and maintenance services for GE oil & gas equipment.
“Localization and in-country value creation are a natural development of globalization and generate benefits to companies and economies,” said Rami Qasem, President & CEO of GE Oil & Gas, MENAT. “At GE, we are committed to working in partnership with our customers to provide the technology, equipment and solutions that can help the oil and gas industry, and the broader economy, across the entire Middle East, North Africa and Turkey region to grow and prosper.”
Other localization examples include the North Rumaila Basra Facility in Iraq, which provides oil and gas field testing, repair and refurbishment services, as well as training; and the ALGESCO Repair Shop in Algeria, which repairs and maintains a wide range of GE equipment, including oil and gas field equipment.
In addition to developing maintenance, repair and manufacturing facilities in the region, GE has launched several partnerships to support local human capital development and industrial deepening. Although not specifically focused on the oil and gas sector, these programs are building capabilities in the region that are helping build the oil and gas industry.
For example, GE is partnering in an SME & youth entrepreneurship program with the Saudi Aramco Entrepreneurship Center (Wa’ed) to engage local SMEs in domestic manufacturing and services.
In partnership with Saudi Aramco and Tata Consultancy Services, GE opened the All-Women Business Process & IT Services Center in Riyadh, that will grow to employ 3,000 women providing advanced business services to GE and other local and international companies.
GE Oil & Gas will present many of its technologies and digital solutions at the Middle East Oil & Gas Show and Conference in Bahrain, which opens today. At the event, GE executives will participate in panel discussions addressing the transformation of the industry, the power of digital, and the importance of localization in fueling a sustainable oil and gas sector for the region.
The GE booth will host 19 TechTalks open to keen learners, showcasing the latest in efficiency-driven technologies across the upstream, midstream, and downstream sectors.