OGN: Your Excellency, could you tell us more about the fine achievements of Banagas in its various fields of activity?
In December last year, Banagas celebrated its 25th anniversary since its establishment in December 1979 with the objective of achieving optimum utilisation of natural gas resources in the Kingdom of Bahrain.
I can say that during these years of operating, the company became a role model for other industries in this country. It achieved many international, regional and national recognitions in the fields of productivity, safety, quality and human resources programmes.
OGN: Banagas has played a crucial role in Bahrain's economy. Could you elaborate on the company's contribution in this regard?
As you know, Banagas owns two processing gas plants and other facilities to treat associated gas and market it internationally and make positive financial contributions to the government as the main shareholder, and to Caltex Bahrain and Apicorp as minority shareholders. In 2004, sales revenue reached 70 per cent over the forecasted 30 per cent in 2003.
The other contribution to the economy comes from the residue gas, which we sent to Alba, Bapco refinery and Riffa Power Station. It is totally 220 million cubic feet per day and used as fuel gas. This residue gas represents 25 per cent of the total Khuff gas, which is provided by Bapco on a daily basis to other industries.
OGN: Banagas has won national and international recognition for its various activities. Can you tell us more about that?
Since inception, Banagas received 50 international safety awards with an outstanding safety record and also received an international recognition in the field of quality. We received the British Standards Institute (BSI) in 1994 with no complaints from our customers and received many outstanding records regionally and nationally.
Besides, we won awards for training and developing Bahraini employees. In the Bahrainisation programme, we achieved 93 per cent of Bahrainis when compared to 68 per cent during the early operations.
The main national recognition we are proud of is the winning of His Highness the Prime Minister's Award for Excellence in Industry in its inaugural year in 1999.
OGN: What are the policies, strategies and vision which make Banagas so successful?
The unique culture of Banagas is represented by the way we manage our operations and resources planning. In Banagas, every employee believes in our core values, beliefs and our best practices which are considered the main contributor to our success.
In addition, we as management try to create the appropriate environment for individual initiative, growth and development and attempt to empower them to be more creative, innovative and work as a team.
In Banagas, we lay more emphasis on promoting high standards of performance and it is now, as we believe, among the most admired companies in Bahrain. I can say that Banagas has succeeded in gaining the support of its employees to enhance its corporate culture and achieve performance.
We work with an identified mission and with a clear future vision and also implement a strategic plan, which is reviewed on a regular basis to identify the strategies that must be adopted for the future.
OGN: What role has the country's leadership played in supporting Banagas?
The Executive Management had the privilege of having the utmost trust by the Board of Directors in our professionalism and belief in our corporate governance in implementing and respecting the high standard of our code of business conduct.
We receive this support from the Board of Directors and the Government authorities, and mainly from the political leadership, without the support of which we would not have the opportunity for our continuous success and achievement.
OGN: Could you elaborate on the key role the Banagas management plays in maintaining the company's high standards?
We firmly believe in providing a sound working environment based on professional values and team work, and in the development of a highly-skilled national workforce.
We implement best practices in all type of operations by sticking to the policies, procedures and regulations whether technical or administrative and attempt to review them through our continuous improvement programme and we are obliged to the adherence of those essential policies, procedures and regulations.
OGN: Could you tell us about the Quality Management System?
The focus on quality of our products and reliability of our gas processing facilities led us to think about the comprehensive programme for the total quality management. Hence, we started with registration in the British Standards Institute (BSI) in 1994, followed by inclusion of all departments activities for certification, and this Quality Standard is inspected twice a year and we are very pleased with this qality achievement with no complaints whatsoever from customers.
OGN: What are the strategies adopted by the company for maintaining safety standards?
The safety aspect became the prime role in our organisational culture and we are proud of maintaining high standards in the field of occupational health and safety. Last December, the company achieved 1.8 million man-hours without a lost time accident since the last incident occurred in May 2002.
OGN: What plans have been adopted regarding the environment?
We always give priority to health precaution of our employees and attempt to protect the environment in providing a no venting and no flaring of gas policy and ensure all equipment and facilities function without any gas leakage with more focus on the surrounding areas to be clean and healthy. This approach was clearly demonstrated during the design, construction and operation phases.
OGN: With regard to human resources development, what plans are in place?
The training and development of employees have always been of paramount importance to Banagas. Last year, we achieved 15,204 training hours. The employee performance management system, which was introduced in 2002, has achieved its goals and objectives to set core competencies at all levels. Many Bahraini employees have taken up higher managerial positions and more is to come in near future.
OGN: What projects have been planned in the future?
The only new small project I see in near future is building an additional LPG storage tank at Sitra with a capacity of 100,000 barrels. We now have three LPG storage tanks -- two with a capacity of 200,000 barrels and one with a capacity of 100,000 barrels.
Depending on the increase in associated gas forecast in the field, we may have to go ahead with construction of a gas compressor station in few years to come if the increase of gas is being appraised and approved by Bapco.
OGN: How has Banagas adjusted to the ever-changing global scenario?
In the gas industry we share so many concerns globally and most of these concerns deal with ensuring production of gas in a very effective way, protecting the environment, safety of people and securing gas facilities and other assets. The gas price and markets are also considered important to make profits to the shareholders and ensure survival and success. Therefore, any changes in these aspects, in which in this industry we always anticipate, and try to make adjustment from time to time.
OGN: What is your opinion on the global price fluctuations in the industry?
The gas price fluctuations are controlled by supply and demand mechanism and in the case of natural gas, the price depends on long-term contract between producers and consumers. We don't see a big fluctuation in this regard but with the LPG prices it more likely linked with the volatile price of oil and in addition to supply and demand.
OGN: What are your predictions about the gas industry in the Middle East and globally?
In the longer term, production in Opec countries, especially in the Middle East, will increase more rapidly because their resources are much larger and their production costs are generally lower than in other region. Opec crude oil supply is assumed to increase to 33 million barrels per day (bpd) in 2010 and to 65 million bpd in 2030 to meet global oil demand. In this case, we will foresee additional quantities of LPG as well.
Worldwide consumption of natural gas will almost double by 2030 to 4,900 bcm. Gas demand is projected to grow most rapidly in Africa, Latin America, China and India. In the GCC region, a huge capital investment has been allocated for construction and development in the gas industry and these are mainly visible in Saudi Arabia, Qatar, Abu Dhabi and Oman.
OGN: What are the company's goals for the future?
We look forward to taking part in any LPG or natural gas development project in the Kingdom of Bahrain based on Banagas' professionalism in this regard. We have signed an MoU with Kuwait Finance House (KFC) in 2004 to take part in the gas processing and marketing the LPG when their mega project hopefully takes off.
