At the helm of the oil industry
Isaac Pinielo | Friday July 22, 2016 13:11
BusinessWeek: Can you give us a brief introduction of yourself, starting with your age, place of residence and place of birth?
Mokgatlhe: A gentleman never reveals his age. I was born in Francistown and currently reside in Gaborone.
BusinessWeek: What are your educational qualifications?
Mokgatlhe: I hold a Master of Science Degree in Air Transport Management from Cranfield Institute of Technology (United Kingdom) and a Bachelor of Commerce Degree from the University of Botswana. I have vast experience in the Aviation and Petroleum industry and have held senior positions in large private and parastatal organisations in Botswana, Namibia, South Africa and the Netherlands.
BusinessWeek: When did you assume the position of CEO at Botswana Oil Limited?
Mokgatlhe: I was appointed as the Botswana Oil Limited (BOL) Chief Executive Officer (CEO) in July 2013.
BusinessWeek: We understand you were Managing Director at Vivo Energy Botswana. For how long were you working there?
Mokgatlhe: Prior to Shell, I worked for Air Botswana holding various positions. I joined Shell Oil Botswana in 1998 as the Public Affairs and Marketing Manager. I later moved to Shell Southern Africa, based in Cape Town - South Africa where I was employed as strategic issues manager. I returned to Botswana to join Air Botswana as the general manager. I then went back to Shell, taking over the role of country chairman - Shell Namibia Limited in 2005.
Subsequently, I was moved to Shell International - Netherlands in 2010 where I was Government relations adviser for Africa. In 2012, I was appointed as country chairman for both Shell Oil Botswana and Shell Namibia. In total, I worked for the Shell Group for more than15 years.
BusinessWeek: Where else did you work?
Mokgatlhe: I have worked for Air Botswana performing various roles as well as that of general manager. In this role, I was responsible for execution of the organisational goals and strategic objectives. I also enabled the board of directors to fulfil its governance function and prepared the airline for privatisation, negotiating with potential buyers, engaging legislature to change the Air Botswana Act and leading staff through change. It was unfortunate that the process was never completed as potential buyers were reluctant to purchase the airline.
BusinessWeek: What can you say about the petroleum sector in this country?
Mokgatlhe: The petroleum industry in Botswana has for over 100 years supported the development of the country. The industry is self-regulating and the main players in the market over this period did well to ensure supply of the product. As the economy evolves, there is need for the industry to transform. We require a clear regulatory framework that governs the sector, more inclusiveness of citizens and development of multiple supply routes and storage facilities for Botswana. Botswana remains a net importer of fuel, however there is an opportunity to participate in other areas of the oil and gas value chain, thereby positively influencing the economic direction of the country. For example, an opportunity exists for Botswana to diversify her economy by beneficiating her vast coal resource by using environmentally friendly technologies to convert coal to liquid petroleum products as well as other by products.
The import substitution will not only improve security of supply, but it is also a GDP revenue multiplier through resultant sub-economies and sub-industries leading to significant socio-economic benefits not limited to job creation.
BusinessWeek: What do you think about the future of this industry considering that oil prices have been declining over the years?
Mokgatlhe: It is important to note that the petroleum industry is dynamic and responds to changes in the market. This includes the production levels of petroleum products and demand for these as well as political stability. As petroleum products are the cornerstones of any economy the need for these will continue into the future despite fluctuating of crude prices.
As the national oil company of Botswana, we have watched with keen interest as the pricing trends evolved. Where possible we have taken advantage of lower prices to replenish government reserve stock.
BusinessWeek: What do you intend to bring to the Botswana Oil Limited that you feel has not been done?
Mokgatlhe: BOL is on track with the execution of its corporate strategy, however we do require enablers to facilitate achievement of some of our strategic objectives. It is important for BOL to lead the transformation of the industry with a view to ensure security of supply and citizen involvement. We will with the enactment of the Petroleum Products Supply Bill (PPSB) and approval of the National Energy Policy (NEP) to support supply of petroleum products to Botswana. I would like to see fruition of these key enablers and therefore I will lead BOL’s participation where possible. Supported by the Board and our parent ministry, we believe that transformation of the industry is achievable.
BusinessWeek: What changes to the company are you planning to make?
Mokgatlhe: Botswana Oil Limited, is at its early age of its transformation journey, having been launched by our President in October 2014. We are currently embarking on a capacity building exercise with a view to enable staff to manage future challenges. It is our wish to grow this company into a large company that supports the country’s growth aspirations.
BusinessWeek: Any operational strategies in place?
Mokgatlhe: We have a 5-year corporate strategy which we are in the third year of implementing. The strategy clearly stipulates how we aim to achieve our mandate of ensuring security and efficiency of supply of petroleum products to Botswana. To give a few examples it outlines the product procurement and logistics strategy, strategic reserve management plan, stakeholder management plan and how we are to facilitate citizen participation in the sector. These and other plans guide the business on a daily basis.
BusinessWeek: What are the challenges you have faced since you took over as CEO?
Mokgatlhe: The challenges that I have faced are those that are characteristic of starting an organisation, these include ensuring that the microenvironment factors enable the organisation. It is important to also be aware of macro environment factors that may influence the business. I have already cited the example of the need to have a conducive legislative framework for the petroleum industry. Currently there is a shortage of skills in the petroleum sector, and it is our role to build these skills in partnership with our key stakeholders.
Through working with the company stakeholders, customers and implementing partners, we continuously work towards closing the challenges we face.
BusinessWeek: A leader must be equipped with a set of competences necessary to perform his/her role. Which one would you say is the most important ability a leader should have?
Mokgatlhe: I would say (1) emotional and social intelligence as you lead people with different characteristics and social lives; (2) Boldness to make decisions that may not always be the most popular but are the most beneficial for the company; (3) Interpersonal skills – mostly to enable the stakeholder management aspect of being a leader.
It is also important for leaders to ensure that the staff is provided with the necessary tools to grow, ensuring that there is clear succession plan. It is important that as leaders, we develop others who will take over from us in order to ensure sustainability of the operations which is key for shareholder value.
BusinessWeek: Where do you think the most significant growth will occur in the company in the next few years?
Mokgatlhe: With the enablers in place, there could be growth in supply and sales volumes facilitated by BOL. This is the most significant change.
BusinessWeek: How do you expect to manage this growth?
Mokgatlhe: We already have various streams of work that aim to prepare the organisation for this change. There is a business readiness project currently being implemented that looks at what is required to manage an increase in volumes sourced and sold to customers. As you would expect this means that all strategic business units will be impacted, from the finance, information communication technology (ICT), supply and manufacturing to business development.
BusinessWeek: How has your company performed since you took over?
Mokgatlhe: Since inception of the company, we have made strides in various areas. To cite a few examples: BOL is currently undertaking a project that is looking to map all business processes and develop a corporate information, communication and technology (ICT) strategy which will result in efficiencies across the business; BOL executed its first project at the Gaborone depot in 2015. The project objective was to expand the depot gantry to enable us to efficiently service our customers. The project was carried out within time and budget; Another project which is in the BOL books is the upgrading of petrol tanks at the Gaborone and Francistown depots. These are to be modified to include internal floating blankets which will curb product losses caused by heat and evaporation.
BOL is running with the execution of a project which aims to expand the Francistown depot. At completion, the storage capacity will have increased by 30 million litres. In addition, road and rail loading and off-loading gantries, an administration block and auxiliary services will be constructed. BOL facilitated the first African Refiners Association (ARA) conference to be held in Botswana in 2015. The conference provided a platform to discuss the important issue of storage and distribution of petroleum products in Africa. The gathering was attended by international and local delegates from South Africa, Nigeria, Namibia, Zimbabwe, Kenya, Togo, Niger, Tanzania, United Arab Emirates (UAE), Cote D’ivoire and Botswana. The Minister of the Ministry of MEWR – Onkokame Kitso Mokaila officiated at the event.
BOL was awarded best exhibitor at the BOCCIM & Consumer Fair 2015 and participated at the Global Expo 2015. We also presented at several international oil and gas seminars including ARGUS and ARA Fora.
We implemented the first national marketing campaign in 2015. Dubbed the Making it Possible campaign, it targeted local audiences and was meant to communicate the critical nature of petroleum products to the country and the role that BOL plays in ensuring availability of such products; BOL continues to foster relations with key strategic partners including national oil companies, oil producers and refiners in India, Kuwait, Singapore, Qatar, Dubai and Angola.
Cooperation agreements have been signed with national oil companies of Namibia, South Africa and Mozambique. Other key initiatives which have kick-started or been launched officially include the BOL Tip-Off Anonymous hotline service and the HSSE Management System (MS).
BOL recorded its first profit in its first year of full operation, a clear sign that with the enablers, the BOL business model is sustainable.
BusinessWeek: How do you manage such a huge company overall and what keeps the business abreast of market trends and profitable?
Mokgatlhe: Information and following of market trends is key in informing any business decisions. As a company we subscribe to various oil and gas intelligence services that report daily changes in the market that may influence our business. These are analysed by the functions responsible and keep us up-to-date on market changes.
BusinessWeek: What are your top priorities?
Mokgatlhe: Our top priority is ensuring efficient and secure supply of petroleum products to enable the national economy. Our corporate strategy stipulates exactly how we plan to achieve this. It includes diversifying the product supply routes, facilitating meaningful participation of citizens in the industry, ensuring optimum management of storage facilities and Government reserve stock. We are also working deliberately to develop our staff and ensure that they are skilled in various areas of the petroleum industry.
As a private company, wholly-owned by Government of Botswana, we are mindful that we must be a profitable entity that has a diverse portfolio of revenue generation streams, this remains a top priority.
BusinessWeek: How do you cope with the pressure that comes with running such a huge business amid stiff competition?
Mokgatlhe: For me, the critical issue is to ensure that one develops the staff to enable them to manage the areas of the business entrusted to them, but still remaining accountable. It is important to build trust in the organisation, and this can be achieved through ensuring that all employees of the organisation, including the CEO live the values of the company.
To try and get away from the pressure, I have decided to get into farming. This activity is certainly a stress reliever. I also read a lot.
BusinessWeek: How do you establish a strong brand in this particular sector?
Mokgatlhe: A strong brand is created by consistently practicing various brand management principles which increase brand equity i.e. goodwill towards the brand.
It begins with understanding the needs of those you service including your customers, employees and other stakeholders. At BOL, we have developed strategies that govern our approach to managing our stakeholders, execution of corporate marketing initiatives as well as public relations and communications structures. We believe that following these ‘blueprints’ we will grow the BOL brand.