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Nigeria: Leemon Ikpea – How NCDMB Can Further Deepen and Strengthen Local Companies

Dr. Leemon Ikpea is the Chief Executive Officer of Lee Engineering & Construction Company Limited. He speaks with Bayo Akinloye about the positive impact of Nigeria’s local content policy on the nation’s oil and gas industry, the vital role played by the Nigerian Content Development & Monitoring Board in deepening local companies participating in the industry and strengthening their capacity. Ikpea also discusses the new normal occasioned by the COVID-19 pandemic and its effects on his organisation’s operations and business outcomes. Excerpts:

How has it been running your business during the pandemic?

The COVID-19 pandemic is like a swarm of locusts of biblical proportion. The health crisis has brought the world to its knees. This is not just in terms of physical well-being; that is, one’s health. It has, in a literal sense, wreaked havoc on every human system. Well, almost, because during this crisis, the Internet-based technology companies have boomed. Some firms, hitherto, making average revenues, have seen their earnings hit a record high that they did not dream of. It has also widened the scope of their businesses. To come back to your question, the business has not been easy since the first index case of COVID-19 was recorded in February in Nigeria.

There is no mincing words that it has been tough running a business under the clouds of the coronavirus crisis. It is no longer news that many businesses have closed shop in the country. Following closely to that is the grim reality that many people, unfortunately, lost their job. But solace can be taken from the fact that while there is life, there is hope. Life continues. This also underscores the fact that health is wealth. When health is absent, everything else is a void, a striving after the wind. In our case, we are in the third decade in the industry. Yet, we were not immune to the virus’ virulent impact in the sector we operate. It was a painful decision for us to let some employees go. These are people we have trained over the years. It was challenging to ask them to go. The reality was grim; production was very low. But at the end of the month, you have to pay salaries.

With integrity and prudence, your organisation has survived and thrived over the years. But with the COVID-19 pandemic making physical contact a ‘taboo,’ what has been the experience for you?

The best way to fight and win the coronavirus pandemic is to stay safe and be strong. I think living and working under a cloud of COVID-19 is another, if you like a new way, of life. With all the seeming doom and gloom of the moment, people have realised that the crisis has opened the eyes regarding saving cost. Think about the cost of travelling from one state to another, from one country to the other, flying from one continent to the next. It costs money to do all that. With restrictions on air travels, one is forced not to travel.

Therefore, if you are not flying, you are saving money. Besides, it reduces the possibility and probability of accidents. You are more likely safe in your conducive environment. But everyone is feeling the joy of working remotely. The Internet became more handy and something nobody took for granted for a moment. Virtual meetings can be held with workers, partners, vendors, and clients. Communication via the Internet became seamless using various tools videoconferencing. It has been a culture for our organisation to hold virtual meetings and has proved invaluable. It cannot be overemphasised that it is an effective and efficient way of doing business. It has reduced our cost of operations. That is good for business.

Lee Engineering has witnessed phenomenal growth over the years. To what will you attribute this growth?

It may sound like a cliche, but I am not hesitant to admit that the phenomenal successes we have recorded over the years are attributable to God’s special grace. Having said that, I will mention hard work. Hard work always pays off in the long run. When you honestly apply yourself to the job at hand and work hard, you are more likely to succeed. The least product of hard work is dignity. The satisfaction that you work for what you earn. Closely related to that is integrity. One must have integrity. You must be known not just for being hard-working, but you must let integrity permeate every process of your hard work, your operations. For Lee Engineering and me, personally, integrity is the key. You may have all the technical know-how, but without integrity, how far can you go?

Not really far. Not far at all. Integrity is the key in our business. That may sound old-fashioned. Yet, it remains what propels businesses in this modern, sophisticated world. It does not have to be the buzzword. It is something every responsible business must live. For us, integrity is not a concept. It is who we are. With integrity, every business partner, client, supplier, or vendor looks for you because they trust you. Who will do business with you if you are not trusted? Integrity is our watchword. We run an honest business. We have honest and hard-working staff. We are not honest and hard-working some of the time. We are honest and hard-working all the time. The company is transparent. For almost 30 years that we have been in business, there is no stain on our name. Our dedicated staff have ensured that. I have used my exemplary life of honesty, hard work, integrity, and transparency to demonstrate to them how invaluable those values are. They share the dream of the company and run with it.

How has the local content policy of the federal government impacted your business?

There is no need to mince words; it has been a fantastic policy since it was signed into law in 2010. That was during former President Goodluck Jonathan’s administration. I take my hat off for the federal government for conceptualising and actualising that policy. Imagine what the oil and gas industry will be like for local players without the local content policy. With the advent of the local content policy, Nigerian companies have been strengthened to play important roles in the industry. It is a thing of joy and pride to let you know that local content discussion started in my office in my Warri office back in the days in the early 1990s. We started this discussion. We were working with multinationals. They would get the job directly from the IOCs, that is, International Oil Companies, then they will sub-contract the job to us. Ultimately, we were the ones doing the jobs, but they were the ones getting the fat paychecks. However, with the establishment of the local content policy given teeth by law, operating as local companies in the oil and gas industry is now a different ball game. Local companies have been given a platform to excel. Our hands have been strengthened. We are working directly with the IOCs.

The local content agency of the federal government. The people working in the Nigerian Content Development & Monitoring Board are hard-working, wonderful people. They love Nigerians. This is no mere platitude. The crop of Nigerians working at the agency have the core interest of Nigeria and Nigerians at heart. I am of the opinion that the federal government should give those working at the agency enough time to build and strengthen the structure they are working with. This is especially so with the leadership position. They should allow the agency to run seamlessly so that if there is a person at the helm of affairs, things will work as if it is on auto-pilot. Currently, the crop of staff at the agency are very meticulous, efficient and they follow the book. They ensure that local players in the industry receive adequate training. The agency also encourages us to establish fabrication workshops where heat exchangers, high-pressure vessels, valves, and other things. Today, I am sure you have seen the place before, if you go there today, we are almost there.

As of now, I will say the fabrication plant is about 85 per cent completed, soon to be inaugurated. I am convinced that this year the plant will be inaugurated. We will also include the manufacturing of industrial gases and domestic gases. We are ready for the gas revolution. Soon, gone will be those days when gas cylinders are imported; we will manufacture the cylinders here. It is part of our plans. The agency has helped Nigerian companies tremendously. The Nigerian government is saving businesses billions of naira. The business is done locally and by local contractors. What is more, the monies are domiciled in the country. Just imagine the multiplier effects.

Once our factory in Warri, Delta state, is completed and declared open, it will positively impact the economy. Think of the many suppliers and vendors that will be involved. It will be a huge market that will attract different people from different parts of Africa to patronise us. That is not all; we are going to engage in capacity building. People will receive training at our plant if this factory is not there, all that will not happen.

The local content body is real help from the federal government to Nigerians. Believe what I tell you: this is my 44th year in the industry. Giving the local content policy legal backing is perhaps the biggest development I have witnessed in the industry. Let us keep hoping and praying for that good people to continue to manage the industry. If the federal government allows for consolidation in the agency, Nigeria’s oil and gas industry will see better times. The factory, when operational, will provide many jobs and save the country the rigours of foreign exchange. The factory will be a one-stop-shop. It is one of a kind.

What do you think can be done to strengthen the Nigerian Content Development & Monitoring Board?

To be honest, I will encourage that the agency should be allowed to drive itself. It should be run without political interference. The government should encourage the agency to deepen its implementation of the local content policy to ensure that Nigerian companies are fully empowered in the industry. Since its establishment, the agency has had about four or five executive secretaries. I am not sure that is the way to go. There should be the stability of leadership. I can beat my chest that the current set of people at the agency are very efficient. The majority of the people working at the agency are extremely experienced individuals.

The federal government does not need to change the leadership of the agency too frequently. I will suggest a tenure of a minimum of 10 years for the agency’s executive secretary. With that, I am confident Nigeria can experience a boom in the industry.

Will you say the local content policy has encouraged more Nigerians to go into the oil and gas sector?

Yes. Nigerians now go into marginal fields. We have our marginal fields. By the time we start our production, we do not need to bring many things from abroad. We will use our equipment, manufacture them, and use them for what we manufactured them for. That is cost-effective.

What are Lee Engineering Company’s milestones?

First of all, I will say the grace of God. Then, experience. In addition, with honesty and hard work, you can reach any height. I worked in the construction industry for 14 years. What are Lee Engineering Company’s milestones? Lee Engineering and Construction Company Limited, as a leading indigenous EPCOM (engineering, procurement, construction, operation, and maintenance) company in Nigeria, has achieved several milestones and received numerous commendations, awards and certificates from both local and international organisations and agencies. We have made modest contributions to our host communities in terms of our HSE policy and higher quality outcomes of our projects that offer our clients the best value for money. The beauty is that we have not recorded any accident. We are safety-conscious. We have a 100 per cent safety record. That’s a fact; for 30 years, we have a 100 per cent safety record. Zero accident. The culture of safety is a part of our day-to-day activities. With each passing year, as an organisation, we have got better and better. We are still waxing stronger.

What will you say are the low moments?

In the about three decades of operation, there have been ups and downs. It has not been easy. We started on a very small scale. We didn’t want to jump the gun. We started with the supply of manpower and safety equipment. We started with N100,000 as of 1990; then, that was big money. We have endured risks and worked in different terrains. The rest, as they say, is history.

The low moment was during the early days of the company while we were in the throes of the learning curve. There some projects we embarked on. As we started the projects, we discovered that our numbers were very low.

Even though the numbers were low, we could not abandon the project. To abandon the project will affect our credibility. Despite being apparent that our numbers were low, I approached the bank and took a loan. It was a risk I had to take for the sake of credibility and integrity. In the end, we successfully executed the project and saved our name. It was a loss. But what we lost in numbers, we gained in credibility. Our first nine years were riddled with losses, about $3 million. We lost a lot. That was tough for us. Over time, we recovered fully. And, as we recovered, we began to diversify our business. We are into retail, tourism, aviation, and manufacturing. We are also into exploration and production. The dividends from that can be used to expand our diversification. We are prepared for the future of fossil fuel. We know that oil will not be there forever. We have a factory that produces water and juices. We have a huge market base that we have not met up with demands.

You have done so much for yourself and your company. What are you giving back to the society?

Giving back to society is one of the gifts God has given to me. I have established a foundation, Agbonjagwe Leemon Ikpea Foundation (ALIF). The foundation was established in 2012.

The foundation has trained students, the majority of them without parents. It is said that there are some brilliant children but nobody to pay their school fees. The foundation does not only pay their tuitions but follows up to monitor their progress in their various schools. As of 2019, the foundation has produced 119 graduates that included medical doctors, nurses, architects, nurses, accountants, quantity surveyors, medical laboratory scientists, lawyers, and other specialists. These are the ones in universities. Some started from secondary schools. Besides that, the foundation trains people in skills acquisition, including welding, fabrication, engineering, etc. Among other things, the company executed an electrification project in Okpokunoe in Delta, completed a rural water project for Ewatto in Edo, provided speed boats Odidi and Kantu in the coastal area of Delta.

Looking back, what do you have to say?

What else can I say but, ‘God, I thank you!’ I am also grateful to my team of dedicated staff. So far, so good. Ninety per cent of the companies we started with are no longer in existence. Today, we have 2,000 employees in the group; that is, Lee Engineering Group and Allied Companies Limited. In this group, you have Lee Engineering, Tribet Ltd (travels and tours), Tribet Aviation, Tribet Purified Waters, and Lee Oasis. The major project going on now is the gas project, domestic gas, and gas to supply the LNG Train Seven. There is also a gas project in Imo. It is a gas transmission facility.

Any message for aspiring young entrepreneurs?

For all Nigerian youths with the passion and persistence to work and earn a living without taking a fraudulent shortcut, keen on learning, I will say, ‘Pause, ponder and take pride in hard work, honesty, and patience.’ Nigeria is a very big country and highly blessed. Nigeria is blessed with a lot of natural resources. To fully harness these material resources, the nation’s leaders will have to seek ways to bring out the best in the people. We stand to gain as a nation beyond description as long as we manage all the resources well.