March 27, 2013 4:25 pm

Working in African Energy: Companies have the financial power to hire

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A bloody hostage stand-off in Algeria, battles against Islamic insurgents in Mali, and kidnappings of western workers in Nigeria have recently grabbed the headlines, offsetting in part the equally florid assessments of some analysts that Africa is a virgin continent lying in wait to generate vast profits.

In a continent of 54 countries, generalisations are hard to make but there is widespread agreement that the energy sector in both mature and new markets is generating opportunities for those with the right expertise, experience and mindset able to exploit them.

“The whole of the energy sector is on the move with new oil and gas fields being discovered, and in renewables, such as solar, wind and to some extent biomass,” says Norman Ndaba, director for power and utilities for professional services firm Ernst & Young in Johannesburg.

“In many African countries, the right policy framework is being put in place and we will see a boom in the next 10 to 15 years as we build the infrastructure to get to the next level. We need all the help we can get.”

For anyone who has never worked in an emerging market, fears about security often top the list of concerns and recent events would have an impact on potential jobseekers, says Arthur Melet, a senior oil and gas analyst for IDC Energy Insights for the Middle East and Africa.

“The security problems in Algeria, Libya and Egypt are something for companies to watch and they may have to hire more locals because expatriates won’t want to take that risk,” he says.

“But there is a lot of investment going on across Africa and companies need employees, so recruitment will increase. Oil prices are high and stable, unlike in the past when a lot of projects were put on hold. Companies have the financial power to hire.”

Headhunters compare working in Africa to the Middle East, parts of which suffered from even worse risk assessments but these did not deter many professionals from pursuing successful and remunerative careers there.

“This is a huge continent and very diverse, and people forget that,” says Robyn Imray, a partner in global headhunter Heidrick & Struggles’ Johannesburg office. “Security incidents do happen but they can get blown out of proportion by the global news media. People need to use common sense and come here with the right mindset.”

After spending $600bn on exploration and production in 2012, the oil and gas industry is set to spend almost $650bn in 2013, according to Barclays, with Africa taking an increasing slice of investment.

New exploration in eastern and southern Africa, including Kenya, Tanzania and Mozambique, is generating a lot of excitement. Activity is also being ramped up in countries with older or more mature energy sectors, such as Angola and South Africa, which is also pursuing renewable technologies, such as solar.

In West Africa, the continent’s largest solar power plant is to be built in Ghana by a British company in a move that it says could start a wave of renewable energy projects across the region. Blue Energy, based in Cheshire, will build a $400m, 155MW photovoltaic array that will be the fourth biggest solar plant in the world when it opens in 2015.

Another cutting edge project is to release methane from deep under Lake Kivu in Rwanda to power electricity for the local grid. “The technology is new and it’s not the government but a private equity project,” says Paul Mercier, managing director for Africa at the Michael Page recruitment agency.

Its clients includes Contour Global, the US energy group that secured funding for the Lake Kivu project.

“Between 15 and 18 per cent of our business is in Africa, so it’s significant,” says Mr Mercier. “Africa will depend on the north for technology and funding for some years to come.”

Privatisation and the opening of markets once dominated by state-owned companies are making an impact across Africa. Investment ranges from equipment companies to private equity and all manner of infrastructure, says Claire Skinner, a Heidrick & Struggles partner and member of its industrial, energy and sustainability practice.

While the “Arab Spring” popular uprisings had resulted in a “pause” in the operations of many companies in North Africa, making growth opportunities more of a medium-term prospect, big projects were moving ahead in East Africa, particularly Kenya, she says. Meanwhile, South Africa was taking advantage of a decline in solar module prices to make big investments in renewables.

“When our clients ask us to identify talent, we look for people who bring a lot of things together,” she says. “People who are tenacious, diplomatic, have experience of stakeholder management and can make things happen.

“Africa is a massive growth market, so for people who can weigh up risk and reward, it can be great. For others, with families or other factors to consider, it can be more difficult.”

Proven expertise was a prerequisite for many jobs at the big oil companies, which use relatively few people in areas such as exploration thanks to advances in technology, says Mr Melet.

“The typical profile of the kind of person needed is a specialist engineer with 30 years experience. So you often see people in their 50s working alongside younger people under 30 as many African countries want to train and to recruit their own nationals,” he says.

This gap of people aged between 30 and 50 is also notable in Angola, says Carlos Moutinho, managing director of professional services firm Accenture’s African resources business. He lives in the southern African country, which was hit by civil war between 1975 and 2002.

“There are the older guys with extensive experience in drilling or reservoir management and then we see the younger people who’ve only entered the industry in the last 10 to 15 years or so,” he says.

“Sonangol [Angola’s state-owned oil company] has the strong objective of training a local supply base of expertise but the oil industry still needs expats in a few areas to do this. We still see companies sourcing abroad while training local resources.”

Mr Moutinho spent several years in the west before returning to Angola with his family to work and is the kind of African professional that many multinational companies would like to recruit.

“It’s been fantastic coming back and working here. There are great opportunities and challenges. The war only ended 11 years ago and the national reconstruction programme has been a key area of focus. For example, roads already connect every major city in the country. And there are great schools, both Angolan and foreign – international, French, Portuguese.”

Valentín de Miguel, managing director of Accenture’s resource business in Africa, Spain, Portugal and Israel, says he often feels “schizophrenic” when travelling between Europe and Africa because of the contrasting levels of optimism and opportunity.

“Europe has so many regulatory constraints, whereas in Africa there’s so much going on,” he says. “There’s a huge investment in electricity infrastructure, railroads, everything. So there’s plenty of opportunity.”

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