NGC pushes new strategic plan

On the heels of historic profits for 2003, the National Gas Company (NGC) has finalised a new Strategic Plan for 2004-2008 to ensure the organisation remains relevant, creates significant value and benefits for the society and economy, continues to grow and successfully navigates the challenging years that lie ahead. Unveiling the plan to employees at the company’s Long Service Awards and Christmas function held recently at the Hilton Trinidad, NGC Chairman Keith Awong said: “Dramatic changes have been taking place in the local and international energy sector. In addition, the local energy sector is under greater pressure from the Government to be the engine of growth that drives the economy to attaining developed country status by 2020. NGC has been charged with the responsibility for developing the gas-based sector in a way that will ensure achievement of Government’s Vision 2020.”

To meet these challenges, NGC’s Board and Management spent several months developing a new Strategic Plan. The two key pillars of this plan are: 1) Improved organisational effectiveness and 2) Business growth and diversification. With respect to organisational effectiveness, Awong said: “The goal is to equip our human resource asset with the required competencies, training and leadership skills to meet the challenges ahead. We plan to upgrade the quality and levels of staffing and to introduce an Integrated Performance Management System (IPMS) using the balanced scorecard method of performance measurement,” he added. “Over the next four years, NGC will use the IPMS to develop leaders with world class capabilities and provide employees with the training programmes they need to acquire exceptional functional and technical skills. Management will also be required to identify and to develop the additional skills that the NGC of the future will need, and develop new reward and recognition programmes,” Awong said.

On the second key area of business growth and diversification, Awong said: “We have a great deal to do to achieve continued business growth and sustainability. In particular, we will have to re-assess our current merchant business, build international businesses, create new local businesses, deliver increased infrastructure capacity, and address the gas compression business.” Noting that “NGC has gone beyond simply buying and selling gas,” the Chairman stressed: “NGC now has to see itself as a global company.” NGC will be researching and identifying the opportunities that exist, such as selling its expertise in the gas business to other Third World countries; and entering other segments of the LNG business such as transportation, terminals, regasification, and direct marketing in the United States pipeline systems. “The bottom line is that NGC must look for new business opportunities both inside and outside of Trinidad and Tobago,” Awong told the audience.

In addition, NGC is directly pursuing a large number of projects over the next four years, including the Cross-Island Pipeline Project, NGC’s largest undertaking in its corporate history, which will require an investment from NGC of US$260 million or some TT$1.6 billion. Other major projects include the US$150-million Beachfield Upstream Development pipeline, the purchase and sale of gas relating to its 11.1 percent shareholding in Atlantic LNG Train IV, and a gas sale/purchase contract with the M5000 methanol investors. NGC is also pursuing several initiatives for new ammonia and related investments, a Synthesis Gas Refinery Aluminum Smelter, Ethylene Complex, and Direct Reduced Iron and Hot Briquetted Iron plants. This means finding significant financing, Awong said. “We, therefore have to convince lenders of the viability of these projects and of our own capabilities.”

NGC’s goal over the period 2004-2008 is to exceed its historical financial targets. For 2003, NGC estimates a record-breaking profit after tax of TT$909 million, more than double its 2002 net profits of TT$409 million. “We will also seek to be among the top financial performers in the local industry — benchmarking ourselves against the rest in terms of such performance indicators as return on equity, profit margins and productivity ratios,” Awong said. He added: “The new Strategic Plan also defines success from a stakeholder perspective and we intend to exceed whatever targets the Government sets in its policy on local contend. We also intend to become much more successful in achieving harmony with the communities affected by our operations.”