Anver Versi, Editor of the London-based African Business magazine, was in conversation with Braynt (ABC) Orjiako, the co-founder and chairman of Seplat.ABC Orjiako practiced as a specialised orthopaedic and trauma surgeon in Lagos, Nigeria, before making the big switch to full-time business in perhaps the most competitive and demanding sector in the economy – oil and gas.
He says he inherited business genes from his family and even while working as a surgeon, he established and ran several companies the upstream, downstream and services sectors of the oil and gas industry in Nigeria.
These include Abbeycourt, which traded crude oil and refined petroleum products with, amongst others, the UK’s Glencore, Abbeycourt Energy, Zebbra Energy and Shebah Exploration and Production Company Limited.
He co-founded Seplat in 2009 with Austin Avuru, who is now the company’s Chief Executive Officer. Seplat has achieved remarkable results in the four years since it began operations and is now considered the industry benchmark in terms of management, efficiency and corporate social responsibility.
ABC Orjiako also has other business interests in construction, real estate development, pharmaceuticals and shipping. He is also the chairman of Neimeth Pharmaceutical International plc, which is listed on the Nigeria Stock Exchange, and a director of MPI and Etablissements Maurel et Prom, both of which are listed on the New York Stock Exchange and Euronext Paris.
I started by asking ABC Orjiako how he had managed to so seamlessly trade in his surgeon’s gowns and gloves for the cut and thrust of the business world.
He said the training and experience he received as a surgeon had, if anything, prepared him for his business life. “As a surgeon, you cannot make mistakes. You have to be very disciplined, very organised, have an eye for detail, manage your team effectively, make tough decisions and take on big responsibilities,” he said.
According to his medical contemporaries, he was an outstanding surgeon but Orjiako did not feel sufficiently challenged in the highly formalised world of the hospital. “Besides, I come from a business family – my late father was a businessman – and all around me I could see business opportunities either going begging or being handled very poorly. So I tried to do other things and found myself naturally slipping into the stream of the Nigerian economy.”
Having spent many long and hard years studying for his medical qualifications, he knew the value of a sound academic foundation. He went for the best and enrolled for a course in management at the Harvard Business School. Armed with a hard-won certificate from that institution on which he could overlay his business instincts, he felt ready to dive into the complex world of big business.
I asked him why choose oil and gas – an industry whose treacherous waters have swallowed up so many business ventures, big and small.
“Oil and gas is the mainstay of the Nigerian economy,” he said. “I wanted to be at the heart of where it was really happening.”
But you were walking into what is probably the most competitive and demanding industry there is, I argued. What gave him the confidence to boldly go where angels fear to tread?
Orjiako explained that several factors had come into play. In the first place, he had established and successfully run several businesses applying his formula for good corporate governance, which included getting intimately involved with the local communities in which his companies operated.
Secondly, the structure of the oil industry was changing. It had been dominated by international companies that controlled virtually all of the upstream activity – exploration, drilling and production. Indigenous companies barely contributed 5% to the total output while a few indigenous companies were involved downstream – processing and distribution in the main. “But upstream is where the real business is,” he said. “Downstream is the icing on the cake.”
Responding to incessant pressure from the indigenous companies, the government wanted to encourage more local companies to go into the downstream section. The oil majors themselves were beginning to divest from their holdings onshore and in shallow water to concentrate on deepwater production.
Their relations with local communities were poor and as a result, they faced continued insecurity and often large-scale oil theft. It was no longer profitable for them to continue to hold on to their onshore concessions. They were willing to sell off some of their assets to local companies.
In addition, there was a great deal of uncertainty about what the provisions of the new Petroleum Investment Bill would include but it was taken for granted that international companies would be required to have far greater local content than hitherto so quite a few of them seemed eager to jump before they were pushed.
Thus the ground was fertile and the timing was right for Orjiako to take a giant step in the industry. He had already established an upstream company – Shebah Exploration and Production.