Advantages of Intergraph Software for EPC CompaniesTue, 01/22/2013 - 12:24
Q: What is Intergraph’s approach to introducing software services to EPC companies and Pemex?
A: Due to the fact that the Mexican energy sector is nationalized, our main customers in the sector are Pemex and the Federal Electricity Commission (CFE), Mexico’s two national energy companies. The other part of our business is convincing Pemex and CFE to request the use of our software from engineering, procurement, and construction (EPC) companies operating in the country. We are currently using this top down strategy because the market has changed drastically in the last decade. Before, Pemex and CFE were indifferent to the software used by the various EPC companies in Mexico, so we used to approach the companies independently. However, now that Pemex and CFE are more interested and involved in such decisions, we have adapted our strategy to raise their awareness of the value proposition of our software services. It has been a complicated change because Pemex and CFE want EPC companies to use our software, but they are skeptical of requesting this specific service from them because they fear it could potentially increase the cost of hiring them.
Q: What arguments are the most convincing in offering your solutions to Pemex and EPC companies?
A: Our software helps with asset design, installation, and plant management. It would add great value to Pemex to reduce the cost of engineering, procurement, and construction projects because the company tends to invest a lot of money in the conceptual phases of the engineering process in order to define, visualize, and create the engineering plans for what they want to accomplish. This can be cost and time consuming if the plan changes multiple times throughout the process; therefore, our software could help EPC companies and Pemex create a thorough and well thought-out plan in order for there to be no changes in the execution of the project.
An example of this is the reconfiguration of the Minatitlán refinery that started back in 2002-2003. It has been a mess because the plan, even though well-defined at the beginning, was not executed correctly, which in turn led to various complications in all the phases of the EPC. The project was supposed to be finished by 2008 - it was originally defined for five years – but it took longer than expected. For this reason, we try to convince owner operators to create an integrated environment with all engineering information that supports procurement, construction, testing, startup, operation, and maintenance activities throughout the lifecycle of a project.
Q: How hard has it been to overcome the challenge of introducing new technology to Pemex?
A: Every single day is a challenge; however, I strongly believe that with the new Director of the development division, Juan Javier Hinojosa, Pemex will be more inclined to bring in more technology. I believe this because in 2003 we worked with him on a reconfiguration of infrastructure for the Ku-Maloob-Zaap field, and we were able to convince him to apply new and better technology on 17 platforms. Furthermore, the issue of software is very complicated because various fields in Mexico use different software, so there is no standardization. In order to fully implement new technology Pemex needs to standardize the software used, and this is where we hope to succeed with our technology.
Q: What do you see as the main growth opportunities for Intergraph, and what needs to change to capitalize on these opportunities?
A: We expect Pemex to start opening multiple projects, like Cadereyta, that was supposed to be open two years ago (August 2010) but nothing has happened. Besides this, we are hoping for cultural change to take place in the country. There seems to be a serious lack of continuity and constant altering of projects that has led to EPC companies losing money and not being able to invest in technologies like the ones we offer. This is a vicious cycle that is neither helping EPC companies nor the whole oil and gas industry.