Closure Interview, Christian Goy, Sales Manager Mining, Oil & Gas at MTU Friedrichshafen
Please describe your position and role within MTU Friedrichshafen
As Sales Manager for Mining, Oil & Gas I am in charge of direct and indirect sales of our mining, Oil and Gas equipment in the CIS market. MTU Friedrichshafen is part of Rolls Royce, manufactures diesel and gas engines and propulsion systems for various applications such as marine, rail, construction, mining, land defense, agriculture, and power generation, ranging from 75 up to 10,000 kW. The equipment is sold to OEMs, distributors and end customers.
MTU Friedrichshafen has long and diverse history across many market sectors. Within Oil and Gas, how has business been over the last 4 years? How do you see growth for this market sector developing in the coming years?
The Oil and Gas market as a whole is going through turbulent times due to falling energy prices and lower growth rates in emerging economies like China. Without doubt we as supplier to the Oil and Gas industry do feel the slow down due to lower demand by our clients. Companies are cutting costs and are reluctant when it comes to purchasing new equipment.
However, historically the oil and gas business has always been volatile and there have been numerous crises over the past decades, so going through those cycles is part of the game. In the long-run the demand for natural resources and energy will rise as a result of a growing world population, especially in India, China and Africa, but also increasing standards of living in many parts of the world which is marked by rising GDPs in developing and emerging countries.
Even if we look at the growing use of renewable energy sources, we see a high need for balancing fluctuating power supply by capable diesel and gas system.
The Oil and Gas industry itself will be looking more than ever into purchasing highly-reliable, low-emission and efficient equipment to meet those demands. The industry will want to include innovative technologies, for instance energy storage solutions or bi-fuel exploration equipment into their fleet. This is where we as a high-tech supplier see our strengths and are constantly pushing innovation.
Focusing on Russia and CIS – what is your current strategy?
Russia holds the largest gas reserves on the planet and is competing for the prime position as the biggest oil producer globally. Legacy fields are exploited and new fields are being successfully developed. The situation is similar in Kazakhstan. Output rates are high in the region and equipment has to be maintained and renewed, so we are reckoning with market stabilisation even though there are political and economic obstacles which we hope will be resolved soon.
MTU has been doing business in the FSU for almost 30 years and has a huge client base across the various applications we serve. The development in the CIS market over the past 10 years has shown one thing for sure to suppliers from abroad: companies are not willing any more to import technology from abroad and be left on their own to “sink or swim”. They demand a reliable and qualified partner nearby to resolve issues swift and sound. MTU understood this requirement. We are currently enlarging our footprint by expanding our sales and service network in Russia and Kazakhstan via own subsidiaries as well as with qualified partners in key regions. This way we are tightening our relationships with existing and new clients and extending our on-site support.
Tell us about a recent success story that MTU have had, either regionally or internationally.
Talking about our Oil and Gas application MTU’s most recent success is the joint development of the industry’s first integrated system for hydraulic fracturing which is based on an MTU Series 4000 engine, a newly developed ZF 8 TX gear box, coupled with the SPM® QEM 3000 hydraulic fracturing pump. The characteristics of the package are phenomenal in comparison to what has been on the market to date. Engine, transmission and pump have been developed to work seamlessly and deliver longer lateral runs, increased flow rates, higher pressures and all this at reduced downtimes and lower cost of ownership for operators. We are convinced that the frac pack will call the attention of many clients in the CIS market.
Under current market conditions – it is imperative to offer your clients the best possible value for money. What are your unique selling points compared to your competitors?
MTU has more than 100 years of experience in developing engines and propulsion systems. We deliver premium products to our customers which benefit from low fuel consumption, long product lives and ultra-high performance. Our customers successfully deploy MTU engines under toughest conditions from -50 to +50°C, in tropical or dusty environments and offshore.
How do you see the Russian O&G markets developing over the next 2 years?
Political developments, sanctions, the falling oil price and the linked depreciation of the Rouble have caused a lot of turmoil. Especially the weak Rouble makes it difficult for Russian customers to source equipment from abroad. Yet, we experience an increased activity in the market. On the one hand, people seem to incorporate political and economic realities into their business planning while, on the other hand, production rates are high and in turn necessitating components and parts replacements at rising scales. The slight correction of the oil price over the past months towards a level that does not severely hurt Russian producers, will contribute to a more stable business environment.
