BusinessDay

Lee Engineering laying foundation for Nigeria’s infrastructural development – Paone

Lee Engineering is driven by the conviction that the much-needed industrial revolution must be anchored on infrastructure said Dott Giuseppe Paone, a former lecturer at the University of Milan (Italy) who currently serves as the company’s Area Manager, for business development, procurement, project management, Europe and Africa.

Addressing journalists in Warri last week, Paone who is on the ground assessment visit to the company’s fabrication factory, said the asset will contribute enormously to the economic and industrial transformation of Nigeria.
The move towards pioneering local fabrication of industrial tools and equipment in the oil and gas industry began when Leemon Ikpea incorporated Lee International Services S.r.L. in March 2009. Its subsidiary Lee Engineering & Construction Co Ltd was founded with aim of providing international services, training and technology development transfer, highly skilled manpower provision, engineering designs, project management, and international consultancies.

Speaking on the impact of the fabrication yard Paone said: “The first impact will be on employment and the second is on the economy itself,”
He said: “Instead of importing from foreign countries, Nigeria will become more independent. Those who will produce the spare parts needed for petrochemicals and refineries will be available at workshops in Nigeria, just as we have here at Lee Engineering.

“These parts could have been sourced somewhere else, outside of Nigeria. So you only import raw materials, then you produce the needed parts here. That increases the wealth of the nation,” he said.

Relating the present situation to the industrial development experience of his home country, Italy, he said that in the early 60s, Italy (after the Second World War), was destroyed.

“The U.S came with funds and we started rebuilding. The development was rapid in the 60s. We started industrialisation from carbon steel, stainless steel, and petrochemicals. “Today, what I see now in Nigeria is the same. You are experiencing the Italian 60s. So you are developing so much because, from 2011, you have been the leading economy in Africa.

“Nigeria is the 5th-largest exporter of crude oil globally. It is the biggest economy in Africa. The first country In Africa in terms of development is Ghana, but the country is small. Nigeria is far bigger. So you are progressing so much, with many middle-class citizens here. “When I came here, I noticed a lot of factories. The middle-class requests moderate houses, and also a lot of services.”

Read also: Nigeria’s oil sector attracts $61m foreign investment in Q1

The Fabrication Factory Initiative
Paone said the concept was to complement the activities the company was already carrying out in the oil and gas industry. According to him, most of the machines and tools used in setting up the factory were bought from Italian suppliers.

Although the goal is to produce pressure vessels and heat exchangers meant for low, mid to high pressure for use in the oil and gas industry, the same machine can fabricate other industrial tools and equipment using carbon or stainless steel as material.

“Talking about stainless steel, I’ll give you an example. In the food industry, we need to transport things like milk, beer, and beverages with trucks. You will notice that, behind the trucks, there are tools and caps. So we built the machines that can enable these tanks to be used for the transportation of beverages.

“We are not focusing on only oil and gas. Why do we want to do this? We know, from industry experience in Europe, that in developing countries like Nigeria, those goods are consumed by the middle class. So the demand for these goods will increase. Their needs will also increase. We want to be leaders in their supply.”

Manpower
Lee Engineering says it is committing to training the local manpower. In this regard, over 30 people have been sent out for training in handling the machine in Italy though the pandemic has affected the schedule. Paone said that the Italian partners have continued to send personnel to Nigeria regularly to refresh the trainees.

Preparations for Factory Commissioning
According to Paone, the Lee Engineering Fabrication Factory is set to commence a test run this month.
“Commissioning activities involve properly installing and fine-tuning machines. If there are instruments like flow meters and others, you will check that they are balanced and are working because the water condition here is different.

“At the end of the commissioning, you make a startup. It’s like buying a vehicle, you turn it on. If it goes on well, it means that all the preparatory activities for the startup were successful. For the vehicle or car, you will check to be sure that everything is in order before you start, won’t you? The startup is the moment when the key to the machine is being delivered to Lee Engineering because it is in perfect working condition. Processes may be different from machine to machine, but the aim is simply to make the machine work,” he said.

Funding
Paone called for government support in accelerating the pace of the industrial revolution by facilitating access to multinational development funds for development purposes.

“We invest so much into this project as a company. Of course, at the moment, all the funding comes from Leemon Ikpea, the Chairman/CEO of Lee Engineering.

“But since we are aware that there is the possibility to get funds from the U.N and related agencies or the World Bank, we are working towards that. I am booking appointments with some people to know whether they can provide funds – not in the form of loans, but with the understanding that we are contributing to the development of the Nigerian economy. That is a common thing to do.”

Some analysts say the limited Nigerian representation on the board of multilateral lenders and without institutional lobbying efforts could affect project financing in the country.

Therefore Paone said the country needed to be more strategic while calling on Nigeria to take advantage of the situation in Europe to fast track its industrial development.
“With the recent decline in energy supply caused by the ongoing Russian-Ukraine war in Europe, all the policies over there are currently being changed in a bid to help source gas. Europe presently has a good relationship with Nigeria, and I believe this presents a very good opportunity for Nigeria to take advantage of the shortfall. I mean right now – not next year, but now,” he said.

The Lee Engineering Group believes true industrialisation happens with active private sector participation anchored on an enabling environment. It has committed resources to the establishment of a steel products fabrication factory, located in Warri, Delta State, and is slated for commissioning this year.

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