Altaaqa Global Upbeat About Growth Prospects
As Altaaqa Global Energy Services emerges from the pandemic with a strong pipeline of projects, CEO James Shepherd tells Omar Ben Yedder why he sees a bright future for new talent in the power industry.
Headquartered in the UAE, Altaaqa Global Energy Services operates in the power sector, building plants around the world that serve numerous industries, powering data centres, cement factories and refineries
from Africa to Latin America and Eurasia. Power is a complicated business involving long-term financial and investment commitments and numerous variables and complexities. CEO James Shepherd is an industry stalwart, having joined the company in 2019 after a long career in the sector.
When we speak, he is somewhat incredulous looking back at the past year. Despite all the challenges, he is amazed and proud that they have managed to negotiate power purchase agreements and develop a pipeline of activity remotely. These are not easy transactions, he reminds us, often involving complex negotiations and are decisions involving multi-million dollar commitment, many around the $100m mark.
He attributes part of this success to the strong relationship they have with their technical partners, who have a strong dealership network around the world. This means that they have been able to deploy qualified and highly trained teams on the ground to install new power plants as well as to coordinate all the maintenance and any issues arising.
Power is a long-term business and in many emerging markets a limiting factor to rapid industrialisation. Still, the uncertainty caused by the pandemic at its outset last year did put a stop to their pipeline: “March last year, everything went off a cliff as I’m sure most businesses went through a similar thing.”
But according to Shepherd, once companies and governments got to grips with the issues at hand, business picked up quickly. “In the fourth quarter of last year, we saw our highest order intake of new projects. Just to put it into context, some of these were projects that we had won in January/February 2020 but which had been put on hold because of Covid and then came back to fruition. Other projects were new projects, investors looking to utilise and capitalise on the low interest rates and low equity markets. It’s been quite remarkable because we didn’t expect the recovery to be so quick and so dramatic.”
Another key attribute, he says, has been to have a bigger group behind them. Altaaqa Global is a subsidiary of the Saudi based Zahid Group. Not only have they got a solid capital base but it also means that they had the resources and infrastructure to quickly adapt and support their teams, helping them to stay at the forefront of innovations and solutions that make their value proposition of interest to prospective clients.
Shepherd undoubtedly loves the power sector, where he has spent his entire career, starting off as an apprentice and as a site engineer at a plant in Sri Lanka. He still thinks that the industry is attractive and appealing to prospective graduates. “The shift towards renewables and cleaner power generation is attracting very talented, young, bright engineers. But from a leadership point of view, you need to treat them in a very different way than you would have done when I was a young 18- or 19-year-old.”
They are also happy to be less micromanaged, he adds, although it’s important as a business to create the right team dynamics and that is only really possible when you have the teams together in the office. The new crop of graduates, he says, seem to be entrepreneurial and as a result, they bring something different to the table and it stimulates a lot of thinking and questioning which is beneficial for the company.
Shepherd admits that onboarding new team members has been a challenge. But once again, being part of a bigger organisation has helped. The Zahid Group, he says, has a fantastic, world-class training centre and they were able to quickly migrate everything online. New employees are taken through a complete induction programme to not only help them integrate but also understand the company history and familiarise themselves with its culture and values. One challenge, though, is that it is harder for new staff to build relationships within the company, what he calls building your own network.
Today’s graduates he says are generally tech savvy. But it’s important to have problem-solving skills too and the ability to be agile. Power is a long-term investment but technological developments means that the innovation cycle is being shortened. This has disrupted an industry used to depreciating assets over a long time frame. A lot of focus is in on battery storage today, when previously it would have been energy production. And even within storage, technological developments are taking place extremely rapidly. The big discussions this past year have centred around hydrogen power. Being part of a bigger group means that they can make big, and considered, bets. “As part of the Zahid Group, we’ve invested and we’ve just signed an MOU with the largest hydrogen fuel cell company in the world.”
It is for such reasons that he’s particularly excited about his sector and why it continues to be appealing for the best in class. It’s at the cusp of innovation and transformation. “I think there is an opportunity for very bright young minds and ambitious people to come in and actually help shape the future of power generation.” And with 54% or so of Africa connected to the grid, innovation has a massive role to play in making energy more accessible to the masses. Across Africa, Altaaqa Global largely serves blue chip companies looking for off-grid solutions such as mines, oil and gas refineries and cement factories.
What about the talent pool; has there been an issue finding the right people? He says that on the ground, the company is 100% run by Africans. The expat model is outdated and doesn’t make economic sense, he argues.
“What I’ve found over my 48 years of living and working in Africa is actually the best people who run your business in Africa are Africans. Today, we have 100% African team in Africa. Gone are the days any CEO would want to have expats running businesses in Africa… It’s never been a challenge for me and many of the people that I have employed over the years have then gone on to take up bigger roles outside of Africa and then returned to Africa.” No one is better placed, he argues, to understand local issues, and therefore these can be resolved more quickly and more efficiently.
"The shift towards renewables and cleaner power generation is attracting very talented, young, bright engineers"
Changes to the way we work
Shepherd feels the strong Q4 2020 and Q1 2021 results they have experienced are somewhat due to the massive injections of capital by various governments to counter the economic impact of Covid. This has provided companies with cheap capital which they are using to invest in new facilities and new projects. He also thinks that this “great reset” will also drive a charge towards greater use of renewable sources of energy. But you won’t be able to have a one-size-fits-all when it comes to the energy mix. And countries need to look at their needs and what they can do.
As we end our call, I ask him what lasting changes we will see in how we work. “Companies have learned that they need to trust employees more, give them more space,” he says. “As leaders you want to see key performance indicators and performance and we’ve sharpened up those things as well to reflect the fact that people will continue to work remotely. Companies will hold people accountable but in a different manner, giving them more space and flexibility about achieving these goals.”
As for their business, despite the difficult job market for young graduates and continuing uncertainty, he is upbeat about his sector, and that it’s one graduates need to be looking at closely. “It’s a global business, working in a sector that is growing and changing and is focused on improving the environment. It’s technologically advanced and moving very quickly.” And it’s not changing just in terms of technology. “There are many more women in the industry,” he adds, “including in very senior positions, so I definitely think the industry is on the right trajectory.”