Rudolf Hess
President and CEO
RH Shipping
View from the Top

Looking for Shipping Opportunities in the Oil and Gas Sector

Tue, 01/22/2013 - 13:05

Q: What are the origins of RH Shipping, and what role do you aspire to play in the Mexican shipping industry?

A: RH Shipping was founded in 1996. The company was created to be an international shipbroker serving the steel industry. In 1999, we were even active in steel trading, when we sold more than 100,000 tonnes of steel billets from the Ukraine to one of our clients; however, we were too focused on Mexico and the steel industry, so when the Asian financial crisis came in the late 1990s and Korean steel flooded the market at extremely low prices, our business almost disappeared, because Mexican steel exports collapsed. At that moment, we decided to diversify our ship brokerage activities to include clients that handle heavy-lift and industrial projects, and general break bulk and bulk cargos.

After successfully implementing our initial diversification strategy, we continued to expand and diversify our activities to include non-vessel operating common carrier (NVOCC) and international freight forwarding services to be able to attend the project forwarding business and handle goods through all transportations methods: air, sea, land, and multimodal transportation. Today, our activities include those already mentioned, plus customs brokerage services, cargo insurance consultancy, packing, supply chain, and warehousing.

Q: How did the diversification strategy facilitate your entry into the oil and gas industry?

A: In 2010, we decided to open a company in Houston to be closer to the oil and gas industry. Today we are ready and have the expertise to further develop our oil and gas portfolio to not only include the transportation of goods, but to also participate in supplying vessels for the o†shore activities of Pemex and their service providers in the Gulf of Mexico.

Q: Which type of major projects have you executed for the oil and gas sector in Mexico?

A: We transported almost 20,000m3 of dismantled LPG spheres on a modern multipurpose cargo vessel for Zeta Gas from France to their terminal at Ensenada in 2010. We have also transported land-based oil rigs from the US toMexico on a port-to-door basis. We have not been very much involved with Pemex, though. We have tried to acquire contracts from Pemex Refining to charter 40,000 tdwt tankers for their costal trade needs, but we were not successful.

Q: What specific services are you planning to oer the oil and gas industry going forward?

A: Apart from transporting goods and o†ering industryrelated services to oil and gas companies, our idea is to further diversify our activities and begin participating in Pemex tenders to charter fast crew boats, platform supply vessels, anchor handlers, and other equipment needed for the o†shore and drilling business. We would also like to participate in supplying goods to the platforms, such as diesel, barite, fresh water, spare parts, cranes, food catering, and so on.

Q: Do you have any, or are thinking of obtaining, quality or safety certifications?

A: Today, we do not have any safety or quality certifications because we have never needed them. However, we would not have any trouble obtaining them if necessary, since we are more than qualified and prepared in every respect. Nevertheless, we are somewhat skeptical about the benefits of certifications, since we have seen that companies have become more bureaucratic and less flexible as a result of meeting the administrative conditions required for certification. Before pursuing certification we would have to analyze the negative and positive impact this could potentially have on our company and go from there.

Q: Why are you so optimistic about your opportunities in the Mexican oil and gas industry?

A: We believe that the people who are currently working at Pemex will bring positive change and development. Emilio Lozoya has a di†erent approach to past Pemex CEOs. He wants to make a lot of changes and is in favor of further energy reform. With his kind of leadership Pemex will be more flexible and this will lead to more business opportunities for the private sector. He represents a new generation that wants to clean up shop and do the right thing for Pemex and the country.