How would you assess the current momentum in Egypt’s investment environment?

The momentum in Egypt’s investment environment has been remarkable in recent years. It started gaining traction in 2015-2016 and has continued to grow since then. We are currently experiencing a surge in projects and a renewed perspective in the country. The development of the Zohr field, which is now producing gas, has had a significant impact. Clients, especially fertiliser companies, who faced challenges in 2013-2014, now have access to abundant gas supply, leading to positive financial results and profits. This, in turn, is driving investments in revamping and upgrading existing plants, as well as the construction of new ones.

What avenues does Egypt’s recently achieved gas self-sufficiency open up?

Egypt’s gas self-sufficiency has opened up new avenues, particularly in the chemical industry. With increased renewable energy adoption, more natural gas is available for other uses. The freed gas can be utilized to produce methanol or other products for the fertiliser plants. This combination of natural gas, power availability, and renewable energy creates opportunities for further industrial development.

What is your take on the Egyptian downstream sector’s recent development and how has thyssenkrupp contributed to enhancing the local transformative industries?

thyssenkrupp has had a strong and long-standing partnership with Egypt, particularly in the fertiliser industry. We have played a significant role in building 16 out of the 17 existing nitrogen fertiliser plants in the country. Our involvement dates back to 1948 when we constructed the first plant, which is still in operation today. Our collaboration with NCIC on the latest project is currently in the starting phase. Over the past 30 years, thyssenkrupp has been instrumental in developing Egypt’s fertiliser industry. In addition to fertiliser plants, we are also engaged in other petrochemical sectors, such as PVC and other polymer industries. Notably, our propane dehydrogenation (PDH) technology, applied for the first time in Egypt through the EPPC polypropylene plant, serves as an exemplary project.

What current projects are you carrying out?

Currently, we are in the final stages of a project with Sidpec to upgrade their polyethylene plant. Additionally, we are involved in an ongoing revamp project with our long-term customer, EPPC. We are also bidding on a project for a new EPPC complex. We are optimistic about contributing our expertise to this project as well. Furthermore, there are several fertiliser projects with our traditional clients in the pipeline.

What should be done to realize Egypt’s full refining capacity?

To realize Egypt’s full refining capacity, two main actions are necessary. Firstly, there should be increased integration among the refineries, following the example set by Midor. This integration ensures that all refineries grow in the same direction, optimizing efficiency and productivity. Secondly, it is crucial to upgrade the quality of the final fuel product to meet or exceed Euro 4 or 5 regulations, particularly regarding sulfur content. This improvement in air quality is essential, especially in Cairo.

How are you dealing with risk management in your business?

Risk management is a fundamental aspect of our business. Although there is now more stability in Egypt, and this is reflected in the ratings provided by major agencies, risk management remains a top priority. We need to address financial and country risks, as well as technical and scheduling risks. Proactive management of these risks is crucial. Understanding the culture and mentality of the country is vital, as is having the right partners in the construction industry to effectively manage schedules and mitigate risks. Our long-term relationships in Egypt have been beneficial in this regard, as they provide us with a better understanding of the local context and enable us to manage risks more effectively.

How do you collaborate with local EPC and construction firms?

thyssenkrupp has its own full-fledged local EPC company, which sets us apart from our competitors. This allows us to minimize our reliance on engineering capacity from the local market because we are an integral part of it. Our main partners are often construction companies, and we maintain excellent relationships with prominent players like Petrojet, Orascom, and Hassan Allam, as well as mid-sized and small companies. We carefully select partners of the appropriate size for each project, ensuring effective collaboration and successful project execution.

How do you take advantage of being both a full-fledged EPC company and a licensor?

Being both a full-fledged EPC company and a licensor provides us with a significant advantage in terms of project development and execution speed. Traditional methods involve searching for a licensor, conducting FEED (Front-End Engineering Design), and then tendering the EPC separately. In contrast, our integrated approach allows us to develop and execute projects at a much faster pace. For instance, we recently signed an EPC contract within half a year from initial discussions with the customer. This streamlined process brings multiple advantages, including earlier market availability of the product, resulting in substantial cashflow benefits for our customers.

How eager would you say Egypt is to embrace the Fourth Industrial Revolution?

Egypt recognizes the importance of Industry 4.0, not only for thyssenkrupp’s Industrial Solutions business area but also for other sectors such as automotive and elevators. Embracing Industry 4.0 is not new to us; we have had a fully integrated IT system in the engineering sector for decades, covering various aspects of operations and control. We are continually upgrading our technology to incorporate the latest advancements in the market. Egyptian customers show great interest in our operations and digitalization approach. We assist them in executing their plant designs, assessing measures to enhance performance and optimize processes. Improved integration between our IT systems and those of our clients enables us to achieve greater plant efficiency, reliability, and better future plant designs through data analysis.

You not only set up third-party plants but also provide tailored support during and after setup, is that correct?

Yes, that’s correct. thyssenkrupp not only sets up third-party plants but also provides comprehensive support during and after the setup phase. We supply spare parts for our own technology, making us both the producer and the service provider. Our field services range from inspections to advanced techniques like laser scanning and drone surveys for plant assessments. We offer maintenance support and assist clients in shutdown planning. Additionally, we provide complete asset management services, including the operation and maintenance of entire plants.

How important is the Egyptian market for thyssenkrupp?

The Egyptian market holds significant importance for thyssenkrupp, particularly in the plant engineering business. We consider Egypt our “living room” because it encompasses the core of our business, from our history to our relationships with clients. Our connection to the Arabian Fertiliser Association exemplifies this commitment. Recently, we hosted a three-day seminar in Germany, showcasing our latest developments in green ammonia and digitization to the association. We actively maintain relationships with the Egyptian fertiliser industry and the wider Arabian fertiliser industry, making Egypt one of our core markets worldwide.

While you use Egyptian staff, you bring in German expertise, so there is plenty of knowledge transfer through training, correct?

Yes, that’s correct. Knowledge transfer through training is a crucial aspect of our operations. We have a stable staff that we train over the years, ensuring continuity and expertise development. Many of our employees start with us straight out of university, and our Egyptian office, operating for 14 years, has witnessed the growth and development of our dedicated team. Recently, we increased our staff from 120 to 200 to further enhance our capacity within the country.

What is your strategy for the coming years?

In the coming years, our strategy revolves around enhancing the integration between our technology hub in Germany, our execution hub in India, and our local execution hub in Egypt. This integration will enable us to provide more tailor-made services and engineering solutions within the country. We also plan to strengthen our service and after-sales support section, as it is a critical need in Egypt due to the significant installed plant base. By focusing on these areas, we aim to continue delivering high-quality products, services, and support to our valued customers in Egypt.

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