Partnership
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Heavy Overhaul by Iranians
Turbines, pumps and
compressors act like a heart to an oil-rich country. Power has to be generated constantly
and a brief failure may result in irreparable damage. Keeping turbines running demands
constant, on-time maintenance, ranging from light repairs to major overhauls. This is
while every now and then mergers, acquisitions, strained relations, economic sanctions and
other complications threaten supplies of spare parts and technical services.
Maintenance, repairs and replacement of turbines, pumps and compressors is a major financial and technical issue with the Iranian oil industry. Ever since the initial establishment of the Iranian oil industry, we have been unable to find an efficient mechanism for local repairs of such equipment. Almost all equipment requiring repairs have had to be shipped abroad for this purpose, and the result has been tremendous costs to the country, without the possibility of transfer of technology. We currently have 22 types of turbines in use in the Iranian oil sector which have been supplied by some 35 different manufacturers. Turbines require light or heavy overhauls after a certain period of operation. Regrettably, about fifty to sixty percent of the turbines have been working beyond their overhaul time. One of the reasons for this is that spare parts or technical know-how for these maintenance procedures are not available locally and on a timely basis. Davaar Moharrek hopes to be able to establish joint ventures with manufacturers of this equipment, to enable us to set up local repair shops for them, so that all repairs will be done in the country, thereby eliminating the long interruption cycles, reduce costs, and to utilize local professionals in the process. Through this endeavor, utilization opportunities for domestic companies also increases. Davaar Moharrek aims to organize the flow of maintenance, spare parts, and manufacturing of spare parts taking full advantage of domestic capabilities, while assisting the transfer of technology and know-how. In what departments are turbines and compressors mostly used, and how do you plan to extend their services? There are five companies affiliated to the National Iranian Oil Company (NIOC) which are the major users of spare parts and services in this area. They are: National Iranian Gas Company (NIGC), National Iranian Pipelines Company, Southern Oil-Rich Areas Company, Iranian Offshore Oil Company, Refineries and National Petrochemical Company (NPC).As far as hardware is concerned, we face a smaller problem dealing with domestic industries in Iran. There are competent industrial units within the country, but technological knowledge should be provided by the manufacturers of machinery. We in Davaar Moharrek have endeavored to encourage foreign repair centers to set up authorized representation in Iran. Foreign partnerships can be realized with the cooperation of private sector in Iran, or foreign suppliers can open up their independent businesses here. We have been successful in entering a joint venture with PII, a Canadian company. PII works on most GE turbine motors. There is another joint venture to be finalized with Wood Group for repairing solar turbines. Davaar Moharrek also has contracts with some other manufacturers to supervise the repair process in Iran. In this setup, we will get the turbines from users and take it to one of the domestic industries under the manufacturer’s supervision for dismantling and restoration.
When do
you think Davaar Moharrek may be able to satisfy domestic needs with minimum assistance
from abroad? In establishing these joint ventures, we have two groups of companies in mind: a) Manufactures like Rolls Royce, Sulzer, Alsthom, Ruston, ABB, Siemens, Westinghouse, General Electric, etc., and b) Repair centers, which do not manufacture turbines, but rather provide quality support and maintenance services for them, such as PII, Wood Group, Elbar and Rolls Wood. The merit of joint ventures is not limited to the transfer of technology. At a minimum, the two markets of the countries involved in the partnership will benefit from this partnership. Additionally, the philosophy behind a foreign company’s presence in Iran is economic feasibility. Naturally, before going through the investment to set up a repair shop, they must evaluate its profitability, and we are confident that such an evaluation will render Iran an economically viable venue for such investments. When a company sells its turbines, they offer after-sale technical support, and a local presence for these services can reduce the company’s costs drastically. For example, fifty to sixty percent of turbines used in Iran have been manufactured by Ruston-Alsthom. In case of such major manufacturers who have several turbines running in Iran, we will try to sign a contract for engineering services. If we need supervision for repairing the spare parts in Iran, they can dispatch their supervisors. How will Davaar Moharrek manage its human resources in terms of technology transfer? For manufacturing and repairing spare parts, we need both an experienced and a young workforce. However, currently the workforce is scattered around the country. We will need to build teams which will be assigned to different workshops. Training the workforce is another important issue in this field which can be offered by foreign companies. Davaar Moharrek insists on expert training in all its contracts with foreign parties. There is a solid supply of technical and engineering professionals in the country which may be absorbed by the industry. General training can be provided inside the country, while specialized training can be offered abroad. To this end, training must be offered in the levels of laborers, technicians and engineers. What is your message to potential partners abroad? We see this as a golden opportunity for foreign investors. Manufacturing spare parts for turbines – particularly in Iran – is a highly profitable field for foreign investment. There is a high profit margin, as well as high demand here, with reasonably low risks involved. We persuade foreign suppliers to open up branches in the Iranian Free Trade Zones for the more accommodating regulations they offer. Many companies have expressed an interest in entering such joint ventures. Major challenges in this field are not technical ones; rather, they are related to banking and taxation systems. Davaar Moharrek is initially targeting to render services in the country which are currently offered by foreign companies. In the second phase, the company plans to render such services to other regional countries through joint ventures. Foreign partnership will encourage the said trend, because of low-priced labor and reduced overhead costs associated with establishing a shop in Iran. Through investments in this field, large foreign exchange savings would be brought about for the country, and moreover, many job opportunities will be created. |
