Expertise in Market TransitionsTue, 12/12/2017 - 08:22
Mexico’s energy sector continues to transition to a competitive multi-company market, midsized multinationals that can offer a global perspective, like SUMMUM Projects México (previously Tiger Engineering) and its holding parent company SUMMUM Corp., are uniquely positioned to offer added-value services, says SUMMUM Corp.’s CEO Daniel Lucio. “While remaining midsize, we comply with all the quality and safety standards that big international players ask for, but with more competitive prices and more focus on client satisfaction than other multinational service providers,” he says.
Lucio is working to bring SUMMUM Energy, a Colombiabased company for upstream services ranging from well testing, maintenance and operation, slick line to construction, to Mexico. To do so, he is leveraging the deep expertise of SUMMUM Projects México, an engineering, consulting and design services company that has been devoted to the Mexican market for seven years. “The fact that both companies are connected by SUMMUM Corporation has allowed us to offer the whole development of the project, from design and engineering to operation and maintenance,” Lucio says.
While SUMMUM Corp.'s headquarters is based in Colombia, Daniel Zuluaga, Country Manager in Mexico of SUMMUM Projects México, says the company’s branch in Mexico is fully staffed by Mexicans, meaning it can also increase the local content of any activity it gets involved in. Zuluaga adds that being a medium-sized but multinational company has economic advantages. “We not only provide excellent services to international companies while remaining flexible, but can also offset market downturns in one country with the activities in another,” he says. “We have witnessed how some companies that have been focused 100 percent on the Mexican market have struggled and sometimes even disappeared because of the downturn in activities.”
While many Mexican players are now struggling to certify their activities so they can provide services to big operators, Lucio says that SUMMUM Corp.'s experience with Colombia’s market liberalization in the late 1990s taught the company the importance of complying with international standards to be able to work with the big players that entered Colombia during the transition. He believes that compliance with international standards along with the company’s alreadyestablished relationships with big players in Colombia has been an invaluable asset as SUMMUM Energy entered and SUMMUM Projects México expanded in Mexico. “Many of the companies we are now trying to work with in Mexico have been our clients in Colombia and Peru,” he says. “Many of these companies are new to the Mexican market and the fact that they know us, as well as our seven-year experience in Mexico thanks to SUMMUM Projects México, allows us to provide them strong leverage in the country.”
While upstream activities are among SUMMUM Corp.’s main areas of concentration in Mexico, mostly due to SUMMUM Projects México’s solid background in that segment, Lucio and Zuluaga see great potential for SUMMUM Corp. in storage terminals. According to Zuluaga, SUMMUM Projects México is in close talks with players that either have a permit to build storage terminals or are in the process of obtaining one. “To enter this market, we want to cover all stages of the projects; from conceptual to basic and detailed design; and also acting as engineers on the design and construction stages,” he says. Lucio highlights the strong experience SUMMUM Corp. has developing these kinds of projects in Colombia and Peru, giving the examples of the EPCM for the expansion of the Talara refinery in Peru, which was done for Petroperu; work at the Bahia port in Cartagena, Colombia developed for Pacific Infrastructure; and the Impala port in Barrancabermeja, Colombia, developed for Trafigura. “Those projects exceeded an investment of US$400 million each, and we managed their construction, which is proof of our capacity,” he says.
Zuluaga also points to the significance of SUMMUM Energy and SUMMUM Projects México being medium-sized and flexible companies, especially considering the size of storage terminals to be constructed. “A 100,000-barrel terminal is not so attractive to a big EPC or engineering company, because the cost does not fit with the economy of the project. Such a company would also be taking on risk by venturing into a new jurisdiction,” he says. “On the other hand, we have the experience and the ability to conclude these kinds of projects.”