Fabrication yards for oil and gas platforms, South Africa

12,000 new jobs

"Visionaries and pioneers like MAN Ferrostaal are needed to develop a brand new industry." - This statement from the South African Ministry of Trade and Industry gets to the heart of MAN Ferrostaal performance. With the construction of the first fabrication yard for new built and modular fabrication of oil and gas platforms MAN Ferrostaal has unlocked a new growth market to the country's economy. In addition to the fabrication yards for new built's construction this project also includes a maintenance and service station for oil and gas platforms in Cape Town. South Africa can now focus on the expanding oil and gas industry on the African continent. In addition 12,000 job opportunities will be created for the citizens, and foreign direct investment is committed. This is just one example of how MAN Ferrostaal, in fulfilling its offset obligations, gives rise to new opportunities for its partners.

Overview

Project type	countertrade transactions
Partner	Grinaker LTA, DCD Dorbyl Heavy Engineering
Project	two fabrication yards for new built, service and maintenance of oil and gas
Sites	South Africa, Saldanha Bay and Cape Town
New Jobs	12, 000
Investment volume	approx. Euro 30m together with project partners
Completion	2007

Market access with good prospects

Driven by the growing oil and gas industry in West Africa and the fields already in existence in the region there is a booming demand for oil and gas platforms. With the fabrication yard in Saldanha Bay MAN Ferrostaal is setting a footprint on a genuine growth market. For example, the oil and gas fields in Africa make up about 10% of the world's known deposits. The USA is increasingly covering its oil requirements in Western and Southern Africa in order to reduce its dependence on the Middle East. Production will therefore rocket as a result. What is now needed are fabrication yards for building and assembling oil and gas platforms. At present these platforms are arriving from Asia, and especially Middle East after being transported over thousands of miles on the open sea to their destination off the African coast. This will change with the new fabrication yard in Saldanha Bay.

Job opportunities for the region

The two oil&gas projects will directly and indirectly create 12,000 job opportunities. This is an important economic boost for Cape Town and Saldanha Bay and a significant step towards cutting unemployment in the region. Creating and securing jobs and providing professional qualifications for workers on the labour market – this is of utmost importance to MAN Ferrostaal's paramount investments in the course of its countertrade program with the South African government.

Atlantis Training Center - MAN Ferrostaal is investing in the setup of a training centre where young people from regions with low infrastructure can obtain professional qualifications on various sectors. The local industry utilises the training centre for training seminars.
Call Center - Together with its partners MAN Ferrostaal is planing to create some 1,000 job opportunities by investing in call centre activities.
Tea plantation - MAN Ferrostaal, as an investment partner resuscitated the local tea industry. Thousands of jobs are sustained by MAN Ferrostaal providing managerial, operational and marketing expertise.
PET recycling plant - Unskilled workers earn their living from organised collection of waste and treatment in the urban areas of Johannesburg. MAN Ferrostaal is financing the building of a new recycling plant for manufacturing granulated raw material from used PET receptacles.

Business model "counter-trade"

Over 100 countries regulate counter-trade business deal obligations in their procurement plans, but few companies offer them. We have been carrying out business with public authorities for many years and have met all offset obligations during this period. We have made a virtue out of this necessity: while many companies regard offset as a necessary evil, we understand counter-trade business deals as an "opportunity" and business model. For this reason we also offer this service to other companies.