CONSTRUCTION: Dynamic duo share a Gulf orientation

03 March 1995

The $1,633 million Taweelah B power and desalination project in Abu Dhabi is a huge undertaking by any standards. The main contractor has 50 technical staff and 7,000 workers on-site and, at one stage, was pouring 21,250 cubic metres of concrete a month. Work includes installing six steam turbines to generate 732 MW and six desalination units producing 76 million gallons a day of water.

The commission to build the civil works for Taweelah B for Abu Dhabi's Water & Electricity Department was won by Belgium's biggest construction company, Besix, and the leading consultant, Tractebel Engineering. Both are operating in what they consider home territory.

'The UAE is a market in which we feel very comfortable,' says Johan Beerlandt, Besix's director-general for external operations. Beerlandt was based for six years in the UAE as head of Besix's local subsidiary Six Construct. 'We have been there since the 1970s and we have grown up working with a generation of people in the emirates, some of whom are now ministers and senior officials. We know them, and they know and trust us.'

'Tractebel is active throughout the Middle East, but within that region we have a few main markets and one, the UAE, which we consider our most important market, especially Abu Dhabi,' says the engineering company's area marketing manager Michel Mauchard.

A strong local presence has helped Besix to win a major share of work on big ticket projects in the UAE in the past two years. The company has some 100 Belgian nationals working in the UAE, together with several thousand expatriate workers, mainly from India, some of whom have been with the company for years.

'We can mobilise very quickly and deliver on time, which clients in the Gulf like more than anything,' says Besix's director of internal and external relations Jos Janssens.

He points to the Creek Side Park in Dubai, where the initial plans were extensively revised to add a sophisticated sprinkler system. This was based on a 150-kilometre computer-controlled water main which feeds 177,000 sprinklers using treated wastewater. The project also required moving 1 million cubic metres of sand and top soil to create a varied landscape for 200,000 imported plants. 'With such a large team on the ground we were able to do this within the original timescale,' Janssens says.

Six Construct was founded in 1975 as the UAE subsidiary of Societe Belge des Betons (SBBM) and registered under Sharjah law. In 1994, SBBM and Six Construct were renamed Besix.

The group maintained its UAE operations during the Gulf conflict of 1990- 91 despite the downturn in construction. It is now reaping the rewards, with turnover of around BF 4,500 million in the UAE, out of total export sales of around BF 10,000 million in 1994. 'This is about the same level of the last two years - although levels of profit can differ from year to year - and we expect this level of business to be sustained for the next five or six years, at least,' Beerlandt says.

Besix operates in 17 countries and this could soon rise to 20. 'We are very big for Belgium, but only small to medium-size on a global scale,' Beerlandt says. This means focusing on priority markets so as to best use the company's resources.

'Usually we need a big contract to take us into the market, and once that is secured we don't want to pack our bags and leave,' Beerlandt says. 'Setting up a project halfway across the world is an expensive business, but if that allows us to get established with local staff, subcontractors and an office then we can go on to find more business.'

Company officials are disappointed when the award of a first contract does not lead to another, as in Pakistan where an order to build a fish harbour and small port at Gwadar did not lead to further business.

A big order in Egypt has encouraged Besix to open a Cairo office and seek more local work. At present it is working on a BF 2,000 million contract for the El-Salaam syphon, a system of four tunnels under the Suez canal which will carry water to irrigate 200,000 hectares of the Sinai desert. Each of the 750-metre tunnels is being dug using water pressure techniques, a high technology process which Besix first used on the construction of metro tunnels under the Scheldt river in Antwerp.

Technical advances in Besix's core speciality, concrete, are being applied to the Suez syphon and an increasing number of projects in the Gulf. This has expanded the scope for much taller concrete buildings like the recently completed Baynounah tower in Abu Dhabi.

The tower comprises three separate structures which are interconnected by a 156-metre circular cylinder, making it the tallest concrete building between Cairo and Singapore. It was built using micro-silica concrete, a highly resistant material whose use is still rare in the region, another selling point when it comes to securing new contracts.

Besix believes that Egypt is a likely source of more work and it is also monitoring developments in Lebanon closely. However, the UAE is expected to remain the company's regional focus for the foreseeable future. 'For the present there is enough work in the emirates to keep us more than occupied and Qatar has emerged as a strong market,' Beerlandt says.

Besix is building a new headquarters for Abu Dhabi National Oil Company with 21 floors in two linked buildings, one to house oil operations and the other for gas. 'We are looking to get back into oil and gas projects in the Gulf where we see the potential for a lot of new work,' Beerlandt says.

Besix is also pursuing work in Oman and Bahrain. But it has no plans to expand its efforts to win orders in Saudi Arabia. Beerlandt argues that operating conditions are different in Saudi Arabia from the other Gulf states where Besix is established.

Consultant Tractebel employs more than 2,400 people, including 1,000 engineers and 500 draughtsmen. Together, they provided clients with some 4 million man hours of work in 1994, staking Tractebel's claim to be the biggest engineering consultant in Europe.

Its core specialities include power and gas supply, water technology, transport and other infrastructure projects. Its development of high technology ranges from providing specialist software for the simulation of power systems, whose purchasers include the four Saudi Arabian electricity companies, to work by Tractebel Information Systems (Trasys) on ground test facilities for the Ariane 5 rocket and Hermes, the European space shuttle project.

Outside Europe, Tractebel is working to develop the booming Far Eastern power market. It is already working in Thailand and Indonesia while pressing into Vietnam, Laos and Cambodia, new markets where it is bidding for World Bank and Asian Development Bank-funded contracts as a first step.

Asia bound

'The move into Asia is very important for us, but so is developing our business in the Middle East,' says Robert De Spiegeleer, commercial advisor at Tractebel Engineering. 'This is a very solid market for power and water projects, which is especially welcome as our traditional markets in Africa are in trouble, even though we have good feelings about South Africa, and the Eastern European market remains difficult.'

In Abu Dhabi, Tractebel is also consultant for the Great Mosque project. Bid assessment for the mosque is under way, but a decision has yet to be made on the contractor. 'We would very much like to expand into the Saudi market,' Mauchard says. Tractebel is actively pursuing several major contracts in Oman and Saudi Arabia, but no awards have been made yet.

In North Africa, Tractebel is adviser to the Algerian state energy company Sonatrach on its project to revamp and expand natural gas liquefaction plants at Skikda and Arzew. This project continues despite Algeria's political difficulties, with Tractebel's contract guaranteed by Belgian state export credits.

Elsewhere in the Maghreb, Morocco has emerged as the focus for new activity, in part due to its promotion of private sector projects. Tractebel is advisor to Office National de l'Electricite (ONE) for its planned build- operate-transfer expansion of power generation at Jorf Lasfar. The company is also involved in bidding for two other power plants, at Mohammedia and Kenitra.

Morocco is also a market for Tractebel's environmental services, including a contract to clean up the heavily polluted industrial port of Mohammedia. This follows an earlier order for Tractebel Consult to study the environmental and pollution problems of Casablanca, Jorf Lasfar, Agadir and Tan Tan ports.

It is a similar story in Tunisia where Tractebel also promotes its expertise in environmental and water projects. It has an order for a 22,500-cubic- metre-a-day reverse osmosis desalination plant in Gabes to treat brackish water. Tractebel hopes this is just a first step towardswinning more work in a country which considers the environment to be a priority.

A MEED Subscription...

Subscribe or upgrade your current package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications