OUR TARGET COMPETITION IS SHELL- HAVILAH ENERGY LTD

I and Moses Aremu (Editor, Africa Oil + Gas Report)met with the CEO of Havilah Energy Limited, Mr Charles Adekuajo;. I was stunned by all the stuffs I heard from him, he began thus:

“I could have been working for Saudi Aramco and earning $2,000 a day”, Charles Adekuajo says, in a converted terraced house that serves as the Lagos office of Havilah Hydrocarbon Resources Management (HHRM), the service company he set up with colleagues in 2007.
“ But what’s more important to me was what we could do as a group for the country. We are helping to break a jinx; “Nigerians don’t work together””.
Adekuajo is not typical of the large band of Nigerians, who have been returning home in the last five years to take advantage of the economic boom in the country. He is not exactly one of those to whom western newspapers allude to when they talk of “brain gain”, about Nigerians who left their homeland to seek riches abroad 15-20 years ago, and are increasingly returning, as Africa’s biggest oil producer rides an energy bonanza that is opening up unprecedented opportunities.
On the contrary, Adekuajo worked in the country all through most the boom and bust cycles of the last 20 years, and walked out of a 16 year career with Shell Nigeria only in 2006, while on cross posting assignment in South East Asia. Between then and March 2008, he managed the well engineering technology department for ConocoPhillips, Canada, and based in Calgary.
This was where he and others decided to form a company to provide services for the oil and gas industry in Nigeria. Twelve Nigerian engineers, living and working in Canada as Canadian citizens, came together as partners in Havilah. “Some are reservoir engineers, some are facility/ construction engineers, some are well engineers. We have people specializing in everything from asset evaluation to delivery of the oil”. The idea was: What technology do we have that we can leverage, which we want to come and deploy at home to help the industry? Afterall, we have all worked for big IOCs and we have imbibed world class processes because of our exposure”.
Adekuajo describes Havilah as a total umbrella service provider for the upstream sector. “We help you assess an acreage and put a value on it for the purpose of participating in the bidding round and once you win the block, we will help you put together an exploration programme for the company - including well placement, etc. What we want to achieve by this is to be a small E&P company for companies with asset but have no capacity. We offer an umbrella package that enables you to get all the services required for product delivery”.
So what, I asked, was Havilah doing at a recent Schlumberger forum at which the latter was marketing its marketing and expertise?
“When we talk about partnership with Schlumberger, it’s such that we can get product from them to deliver our services. In which case we are the ones that take the job and work with them in delivering our services.
“What you see in this business is that it is the person who is driving it that dictates. Whatever Schlumberger, Halliburton or Baker Hughes is doing for us, we’ll have our own people supervising. They have the technology and we don’t need to re-invent. We are a start up company.”
“We try to offer solutions. Most of the people who got Marginal fields don’t have the technical expertise. We are set up to help them with asset evaluation, well planning, well execution and reservoir management. Only when the oil begins to flow, we leave. With Havilah as the driver, we can collaborate and get things done in a faster way.”
We are delivering services to Midwestern. We are the well services adviser to Midwestern. Schlumberger discusses with us on this and other projects. The services they offer, we are the ones buying them. With Baker we have an ongoing discussion to form an alliance with them. Schlumberger is a very good company. They’d tell you they deliver services, not products. Still, if you are looking for the best well engineers, they are the ones who have worked with IOCs, not the ones in service companies. The service companies deliver segmented services. A good bit engineer may be very helpless in mud engineering and a good mud engineer may not know what the hole is saying and all these highly specialized people may not know anything about casing designs.
But the E&P engineer has a total picture of the well, right from the rig to all the products and services in the well.
Adekuajo graduated in mechanical engineering from Ibadan in 1986, and worked with the NEPA, now Power Holdings Company for 18 months. In 1989, he joined Shell as a well site petroleum engineer. After field training you had a choice to go into Petroleum engineering or well engineering. The well engineer had the choice whether to be in the field or to be in the office as a well planner. For a well engineer, the offshore is a more challenging environment. The work that you need to do offshore takes more time and varied equipment, but the design basically work on the same principle. I did well engineering both in the office and on the wellsite.
By 1995, six years after he got into the company, Adekuajo had become the Stuck Pipe Focal Point for Shell Petroleum Development Company of Nigeria. He was the borehole stability adviser for Shell Nigeria. He was based in Warri.
“Our focus then was to reduce stuck pipe incidents to the barest minimum. By the time I took over, it was a huge problem. For every two wells drilled by the company, we were getting stuck in one. 40% of days on well was downtime. Half of that 40% was spent on stuck pipe alone. The company needed a Czar of sorts, to take charge of things. “That as when I got drafted.”
Adekuajo became a well examiner of sorts for the company. “Before you drilled any well in SPDC, I had to do a health check. That was my role. It was part of that development that we introduced pseudo oil based mud. It was synthetic oil based mud. Baroid had their own system. Baker had their own system. We used Baker’s own system. Before then we’d used the Baroid oil based mud and we were having problems.
I told him I thought it was unbelieveable. Shell had the entire Nigeria as acreage before 1960. Today, it has more concessions than all of the concessions that Total, Agip and ExxonMobil have. By 1995, the company had worked these acreages for fifty years and in fact, the shape of the concession map of the Niger Delta today, is the shape that Shell created, as the company was forced to give up acreages for other competing companies when Nigeria became independent. How could a company with such institutional memory, with database full of examples of drilling challenges, suddenly begin to experience hole problems. Haven’t Shell drilled in most of these areas?
Adekuajo had an answer.
Prior to the nineties, the industry was drilling straight holes as a rule. Then there was a surge of deviated wells and the horizontal holes almost became the norm. The complexity of these wells became an issue. “When we began to drill multilaterals and so on, the complexities increased”.
In 1997, after he’d done stuck pipe for two years, he had helped impart the expertise on the project teams and the need for a well planning czar had disappeared. By then stuck pipe problems had disappeared in Shell Nigeria operations.
Then came another challenge. Community unrests, which had spiked across the Niger Delta basin by mid 1995, had heightened significantly by 1997. As most of the company’s assets were on land and swamp, Shell began searching for solutions. Multidrill, ie. for drilling several wells in one location, was a product of those circumstances. . “We proposed a multi slot swamp rig, he remembers. “There wasn’t any in the world so we had to design one. The idea was to import offshore drilling technology into the swamp terrain”. In 1998, he helped design a rig; Parker Rig-75 (now Shell Rig-2), which was meant to assure multi-drilling activity, on a single site, in swamp locations”. Adekuajo was in on the concept design and he was part of a team that supervised the construction and delivery. “Shell actually built P75 from scratch, completely new, built and delivered.
Adekuajo took his family to Canada in 2002 after he received the Canadian immigration visa. On cross posting in Malaysia, he was interviewed by ConocoPhillips, who agreed to post him to Canada. He left Shell. Five years after he became a Canadian citizen, he is back in the country of his birth, looking to be involved in the expanding opportunities for “local content” in Nigeria’s oil and gas sector.

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AFRICA OIL AND GAS REPORT: February Edition, 2009