Customer service management, technology leadership, a variety of new value-added services – these are key components in a strategy that is helping DNV expand further into the Middle East market.
With the strong demand for risk management services in the region’s energy and industrial sectors and surging growth in ship classification, DNV in the Middle East has recently announced record turnover. Revenues for 2007 totalled US$ 38 million, up 33% on 2006 levels, with maritime accounting for 61%, energy for 25%, and other industries representing 14%.
Commenting on developments in the Middle East and India, DNV’s senior vice president and regional manager for Maritime Eivind Grostad says, “The maritime business is surging ahead, oil and gas activities are growing at a steady pace and the industrial certification, training and risk management business is on the increase.
“Business trends are exceptionally positive and in response to the enormous potential here, we are increasing our commitment to the region as more and more customers are expanding their own businesses in this booming economy,” he adds.
DNV has a network of 20 offices in 9 countries, and supplies a full range of technical and consultancy-related services in multiple fields, including the shipping industry which it has kept a close eye on since it set up in the United Arab Emirates 31 years ago.
Fast developing shipping sector
“It’s been a fast changing, fast developing industry and still is, but what was relevant say 10 years ago isn’t as pertinent today,” says Mr Grostad who firmly believes Dubai has the potential to be the world’s most competitive maritime cluster.
“DNV’s recent growth in the region reflects that of local shipowners themselves. Until about eight years ago we mainly took care of ships in operation (SIO). Now owners in the region have some 6.5m dwt of newbuildings classed with DNV on order. These ships will in due course come here as vessels in service."
In addition to its SIO and newbuilding work, DNV also acts as technical advisor to many companies in the Middle East. “DNV applies its managing risk services to help companies gain global knowledge through our local customer service management, approval support centre and innovative services such as nauticus hull integrity,” says Mr Grostad.
One particular area of recent growth for DNV has been offshore, with classification of both jack up rigs and offshore supply vessels. As the amount of deepwater exploration and drilling around the world increases, so does the need for more sophisticated equipment, explains Mr Grostad. “DNV currently has 55 offshore vessels on order in India, a lot for owners in the region.”
Booming oil and gas sector
Since the early 1980s. DNV has also been involved in the oil and gas activities and today operates mainly in Kuwait, Qatar, Oman and the United Arab Emirates. “The market is hot with huge development projects in the upstream, downstream, pipeline and LNG sectors,” says John Yates, DNV Energy’s area manager in the Middle East.
According to Mr Yates, the national oil companies are prioritizing Health, Safety and the Environment (HSE) as they work to comply with regulator codes of practices, insurance requirements and other stakeholder expectations. “HSE culture is positively changing and this is leading to more work for DNV.”
He adds, “We also see that an increasing number of international companies are investing in, and moving to, the UAE and other Middle East countries to secure more business in this huge market. Local producers are also rapidly learning to become consumers, too, as petrodollars, booming economies and population growth combine with state subsidies to fuel consumption.”
In response to market demand, DNV is actively developing both new and existing services to help its customers enhance business performance and improve safety and environmental performance. “In addition to our traditional consultancy, verification and integrity management services, we are now introducing newer services such as enterprise risk management, DNV’s International Safety Rating System and environmental due diligence auditing. We believe that the ability to swiftly respond to change, and a committed approach to further innovation and technology know-how, will help position us for the future.”
Innovative certification and rating services
While DNV is known for its expertise in shipping and offshore, the company’s other main business in the region is derived from its certification and training business. “The certification business spans across all industries, from IT and telecoms to food and beverage,” says Torger Baardseth, DNV Industry’s vice president and regional manager in the Middle East.
“The demand for certification of management systems is rising as companies seek to ensure quality products and services that can be trusted ,” says Mr Baardseth adding, “we now provide a full range of services for managing and integrating safety, health, environmental and quality systems across the industrial spectrum.”
Despite the positive business developments, Mr Baardseth points out that certification services have to a certain extent become “standard practices” and, as a consequence, it has become increasingly important for DNV to differentiate itself from the competition through the provision of innovative services.
“Our customers want more than just a certificate so we need to develop new services to meet their needs. Areas where we are currently providing value-adding services include risk based certification, risk management and training, climate change-related services, and verification of corporate responsibility and sustainability reporting.
“At DNV, we recognize that risk management is becoming increasingly important for companies across all industries, which is why we remain committed to developing our core competencies to identify, assess and advise on how best to manage technical and business risks. By providing business with tools to manage risk, we strive to help our customers maintain a safe and sustainable business and, in the process, go some way to realising our purpose to safeguard life, property and the environment in the Middle East.”