How To Startup An Oil-Servicing Company In Nigeria

How To Startup An Oil-Servicing Company- Beginners Guide

Hello friends, today, we shall be looking at how you as a young employed or unemployed graduate can startup your own oil servicing company and grow it to become a major player in the Nigerian oil and gas sector with time.

Note, the tips I will be sharing with you here are not theoretical tips, but practical approach that I and a sibling used, and that which two close friends used to open up their own running oil service companies as we speak.

Sometimes when you hear- oil servicing company, your heart skip with fear, you start to imagine how they started, and how they got the big money they used in starting up the company, but I am here to let you know that it doesn’t really cost much if you know what you are doing, focused, determined and also know the right steps to take.

SAIPEM Contracting Nigeria limited, Expro Group, etc all started somewhere before becoming reputable. I am going to spare you long stories, but I have to let you know that you can start your own oil servicing company today and grow it to become a giant company in future to come, so don’t be afraid to start, just give it a try today and see.

Are you an engineering graduate still searching for job or already working? Do you want to own an oil servicing company from scratch? Do you have passion for oil and gas? Do you have passion, skill and talent in technical works? Can you weld perfectly, design good carpentry works, jig fix and render excellent technical support services? Do you have a rare skill in HVAC (Heating Ventilation Air-Conditioning and Cooling)? Can you troubleshoot faulty air-conditioning units, including industrial chillers and heaters? Can you carry out industrial air-conditioning piping and design? Can you design, draw, simulate with AutoCAD, autoplant, etc? Can you design industrial pipes and pipeline? Can you paint perfectly with special paints and additives? Can you work on rigs- casing, tool push, and even construct rig frames? If you can do at least two of the above, and you know a close friend, a course mate, a sibling, relation, neighbor, etc who can perform any of the aforementioned tasks perfectly, then you are qualified to startup an oil-servicing company.

What does oil companies do for oil firms? They construct rigs for them, they design pipes and pipelines, they carry out most of their engineering, technical and construction works, ranging from mechanical, electrical, carpentry, to supplies.

Nigeria is amongst the top oil producing countries in the world today, and yet, we have very few indigenous oil companies in Nigeria today, that’s absurd if you must agree with me. Nigerians keep clamoring to get employed in top multinational oil and gas companies, forgetting that they can as well startup one and make it a giant company in future to come.

With oil status as one of the giant producers of crude oil, Nigerians are supposed to own a lot of firms rendering services to the oil and gas sector, but the case is different due to the fact that our graduates and youths in general believe only in working in an already established companies to the detriment of Nigeria’s future industrialization.

Must you startup a business all alone? Can’t you team up? Why is there partnership? Oh yes, I know your excuses- Nigerians are bad, corrupt, not trustworthy, blah, blah, blah…but remember that there is legal approach to incorporating and partnering in business to ensure equity? Must you do it by way of words? Why not get a professional lawyer to prepare a deed of partnership for you and your partners?

So many youths wants to startup a business or company today, but they have carried out their survey, and the cost of starting up the business stands at say, $10,000, and currently, they have only $4000, and in the process of trying to get a loan from bank or borrow from family and friends, they get frustrated because they don’t have collateral to secure loan from bank, and their family and friends aren’t taking them serious to lend them money or they might not have, or they might be afraid that he or she won’t pay back after they lend him or her the money, and in the process, their dream of starting up a business or opening up a company dies like that, just before their very own eyes.

In order words, you have a friend, a brother, a sister, a course mate, etc who is also dreaming to startup a business, but have only half of the startup capital, and you too can’t trust each other to partner to startup, and we keep complaining that the government is bad, how?

We the Nigerian youths must learn to partner in business if we must overcome this present unemployment in Nigeria- partnership is better than sole proprietorship in so many ways. Imagine when three people pull their resources, talents, skills, passions and connections together, imagine how far they would go? This is the case of westerners- they partner in most things they do; Julius Berger wasn’t a one-man business, SHELL isn’t, and so are so many other multinational companies we hear about daily. Most of them are group-owned; either group of friends, siblings or colleagues who share similar dreams of owning a giant company, so what are you waiting for?

You want to startup an oil servicing company from scratch?

The truth is that if you don’t have a lot of money to hire the best hands and setup a good structure, you may not achieve that goal, but if you can partner with your friends, colleagues, course mates, siblings, believe me, it will be easier for you. How?

Gather your friends or course mates who have good technical skills and talents in the areas I mentioned earlier, discuss with them on starting up an oil servicing company, and hear them out.

Let’s say you are able to organize five friends who have skills in- welding & fabrication, carpentry/civil engineering & architecture, AutoCAD/Autoplant/Piping design, and maybe another with a rare skill in HVAC, etc. What next should you do?

1.       First, mobilize your friends or the people that have the skills I mentioned to form a one united team with one goal.

2.       pull your meager resources together, and then get a legal practitioner to prepare a deed of partnership for you guys based on individual contributions

3.       form a company name, and get it registered with CAC

4.       Get a DPR (department of petroleum resources) certificate to enable you participate in Nigeria’s oil and gas business sector, either as a vendor, contractor or a major player

5.       You also need a tax clearance certificate for the year when applying for some contracts and a Tax Identification Number (TIN)

6.       Value Added Tax (VAT) Certificate- optional for some contacts

7.       You need a bank statement to secure certain contracts with top oil firms

8.       get an office or workshop (as the case may be) to enable you guys have a place of identification

9.       prepare solid proposals, tell friends, family and church members about your new company, start socializing and broadcasting your new company, you guys can run radio jingles if you have extra fund to foot the bill

10.   Start with small projects- repair works for individuals to keep your running expenses while preparing for the main thing.  We will come back to this later.

Now, how do you secure contracts with oil companies? It isn’t magic like most people do claim, all you need is believe in God, have faith and know what you are doing. Again, network as much as you can…and talk big about your company using all available strategies…but make sure you stay focused.

How to become a Contractor/Supplier with TOTAL (TEPENG)

Note: The processes for registration are:

A)     Online Application

-          You need to complete an online application form on Total Registration Website below:

www.ng.total.com/staging/04_total_nigeria_activities/0407_become_vendor.htm

-          Applicant will be invited for Pre Qualification Interview on first in first serve basis

-          Successful applicant receives and accepts Total General Terms and Conditions for Purchasing or/and Service

-          Successful applicant registered as Vendor/contractor on Total Database by the

-          Issuance of a vendor code number.

Alternatively

Visit Total Head Office, and request from User Department- User Department fills VMF (Vendor Master Form), and follow other necessary procedures.

In order not to overwhelm you, let’s stop here for now, we will be discussing how to become a vendor/contractor for other major oil companies- Mobil, Chevron, Adax Petroleum, SAIPEM, etc. Stay inspired, visit and subscribe to Ng Blog for more inspiring write-ups for free.