Tuesday, 30 August 2011

Floating and Production, Storing and Offloading ships have been developed over a 30 year period by Petrobras and are now common on the Pre SALT and Campos basin oil fields. Two of the main advantage of these very large ships is that they can store oil, which is very useful where there is no pipeline and they can get out of the way of inclement weather. Certainly they have a limit in terms of capacity, as one will eventually fill anything up but for the Gulf of Mexico, which has very deep areas where there are no pipelines and some pretty horrible hurricanes. Most hurricane seasons see the suspension of oil production and the destruction of many platforms, which when you have thousands in operation is a risky and expensive business. One of the latest ships being operated by Petrobras is the BW Pioneer, which can drill to a depth of 2,500 m, a record for this type of drilling platform and can process up to 80,000 barrels per day. This system of oil production requires two sets of flexible connecting pipework, one that connects the rigid vertical pipes to the FPSO and then another set that connects the FBSO to the shuttle tankers that take the oil to the land based refinery. Two of the many challenges involved with flexible oil lines are how the pipes are connected/disconnected, whilst at the same time dealing the high pressure and the other is mooring the top of the vertical risers when not connected to the FPSO. A whole set of critical developments, which are some of the reasons why oil &gas technology developed in the Brazilian oilfields are being exported around the world and we will be seeing more and more exported around the world.   ©William Barron - Business in Brazil - August 30th 2011...

Friday, 26 August 2011

The Solimoes Basin is the second largest gas reserve in Brazil and the challenge was how to get it to the urban areas in the Amazon. One doesn’t think of the Amazon being very populated apart from Manaus, built and made famous since the days of the rubber boom in the early 20thcentury. The pipeline is 661 km long, costing £1.8 billion and main trunk line runs from Urucu to Coari and on to Manaus, with seven branch lines to the smaller cities on the way. As you might expect there were many challenges on the way as there is a lack of infra-structure in the forest and therefore the construction teams had to be very independent, working with the Brazilian Army, who set up 22 work camps at regular intervals, each with a capacity for 160 people. The natural gas will be used to power a number of thermo-electrical plants in the area to provide electricity to 1.5 million people, as part of the government’s new policy of “Lights for All”. In the past most of the electricity has been powered by diesel, which will automatically reduce emissions for the area. As a lot of the area is under water and of course there are the trees, there were some difficulties finding space to put the pipelines together and so huge 1 km rafts were constructed upon which the sections were assembled before being coupled together. Overall some 6,000 floats were used in the project, which also allowed the work to continue during the seventh month long rainy season from November to June. Two aspects of the project during the journey across the forest, eight sites of special archaeological interest were discovered with finds of artefacts dated back some 3,000 years and these items will be brought together to create a special museum. The other concern was the health aspect and the hazards faced by the workforce with the constant marauding mosquitoes, which had the potential of carrying malaria and dengue fever, and also other known diseases like yellow fever and Chagas disease. Overall lots of challenges and demonstrates the many sorts of huge infrastructure projects being undertaken as part of the PAC 1(Plano de Acceleracao do Crescimento) started in 2007 by President Lula.   ©William Barron - Business in Brazil - August 26th2011    ...

Wednesday, 24 August 2011

As some people will know President Dilma Rousseff has, since she took over from President Lula in November 2010, suffered the resignation of three ministers over the past seven months - Antonio Palocci (Home Affairs), Alfredo Nascimento (Transport) and Wagner Rossi (Agriculture) - due to alleged corruption. There have also been a number of other high officials who have also resigned. At the this week’s swearing in of the new Minister for Agriculture Mendes Ribeiro, Presidente Rousseff said “that it was her duty to see an end to the impunity which shelters many of those accused of involvement in corruption practices and we will punish all abuses and excesses.” It appears that the President is taking a much harder line on corruption than her predecessors, but runs the political risk of alienating some of her political support in Congress. The challenge though with this sort of social change is the relationship between corruption, transparency, the handling of political power and the distribution of wealth. These items have been the bogey men through history for all countries and as you might imagine some countries are worse than others. What some people may not know is that all signatories to the OCED have since 2002 been party to the International Transparency ratings list and if you go on http://www.transparency.org/policy_research/surveys_indices/cpi/2010/resultsyou will see some interesting statistics, which will surprise and shock you, well it did me. I thought that the UK would be at the top but we aren’t .. we are in 20th place with a relatively lowly 7.6 points and Brazil is in 69th place with a score of 3.7. The idea has been to make countries clean up their act and certainly the behaviour of our MP’s and bankers demonstrates that the UK is probably in the right place. The table below shows some of the other countries:   Position Country Score 1 Denmark, New Zealand, Singapore 9.3 8 Australia, Switzerland 8.7 15 Germany and Austria 7.9 17 Japan 7.8 20 United Kingdom 7.6 22 United States 7.1 25 France 6.8 30 Israel 6.1 67 Italy 3.9 69 Brazil 3.7 76 China 3.5 78 Greece 3.5 87 India 3.3 154 Russia 2.1   The interesting thing is that the Scandinavian countries are way out ahead, the Antipodes are at the top with some of Europe, the UK is above the US and France but the BRICS are quite a way down and President Roussseff wants to improve their position as the Brazil begins to take a more important place on the world stage. Certainly for the UK this is a bit of a wake-up call and certainly it is great that Brazil is doing something about it. ©William Barron Business in Brazil August 24th2011...

Tuesday, 23 August 2011

Rio de Janiero’s world famous football stadium Maracana, which used to hold just under 200,000 standing spectators, when it was first built for the 1950 World Cup, is in the process of being re-built to house 85,000 seated spectators and fulfil all FIFA’s security specifications . It is scheduled to be ready in 2013 well in time for the World Cup final in July 13th2014 but there is a report out that the stadium has suffered a n explosion with one worker reported dead and other workers striking complaining about working conditions. Maracana is one of twelve stadiums being upgraded or built from scratch around Brazil in readiness for the World Cup – Manaus, Fortaleza, Natal, Recife, Salvador, Cuiaba, Brasilia, Belo Horizonte, Porto Alegre, Rio de Janeiro, Sao Paulo, Curitiba – and a total of approximately £660 million has been put aside for the repair, upgrading and construction of the stadiums of which three are privately owned. Certainly there are huge opportunities for UK companies to be part of the huge World Cup and Olympics in 2016 but it will be part of the lower supply chain for the massive infrastructure upgrading which needs to take place. The window of opportunity is amazingly beginning to close as so many companies from around the world are already moving in on Brazil as they scent profits now and in the future.   ©William Barron Business in Brazil August 23rd2011 ...

Monday, 22 August 2011

Almost unnoticed in the press was the fact that in January of this year Brazil refused entry for the docking of HMS Clyde, the Falklands Islands protection vessel,  in Rio de Janeiro. This was the first time for a long time that such a thing had happened as Brazil and Britain regularly exchange boat visits and in fact the Navio Escola 'Brasil'  is making one of its regular visits to London  on August 31st. At the time many people thought so what that Brazil is beginning to side with Argentina over the Falklands but with the increased interest in the Falklands helped when the British Geological Survey said there could be 60 billion barrels' worth of oil there, this takes on a slightly slant. Since that statement was made, Rockhopper has carried out a lot of exploratory work there and in April and May 2010, which resulted in the first oil coming to the surface from the North Falkland basin. So what you might think but the thing is that if Rockhopper finds more oil and this is developed by them or one of the huge petrol companies like BP or Shell, where on earth will all the supplies come from. Of course if Rockhopper sells to Petrobras then that will also be an interesting twist but if it is developed by a British company and if there is an accident where will the aid come from. The UK is 8,000 miles away and with no open ports to British boats bound for the Falklands on the Atlantic side of South America, there will certainly be a lot of head scratching. With Brazil rapidly becoming the epicentre of deep oil drilling expertise, as a result of the Pre-SALT oil discoveries, logic states that support would come from there. Maybe it is a good thing that even if oil is discovered in great quantities, it will not be commercially available for some years. This will give time for the diplomats and politicians to work out a solution, which of course could be that the Falklanders decide to go for independence.   ©William Barron Business in Brazil August 22nd2011...

Friday, 12 August 2011

The Latin America Business Monitor or BMI for short is one of those added value items that organisations offer and when the Brazilian Chamber started to send it out, I was not sure how much time I should spend looking at it. The challenge for us all is that we get so much information and other 10 pages could be another 10 pages to skip.   I have now learnt that to keep on top of what is going on in Brazil I need to read everything on the BMI as it means that I don’t have to go through O Globo, the Folha and Veja for general news and I also get some economic information as well. Well presented, supported by facts and figures with the odd graph, this is 15 minutes of time very well invested.   The first thing this month, which took me by surprise, is their downgrading of Brazil’s economic growth projections and why, when everybody that I talk to in London is talking them up. There were also some additional comments about the close scrutiny of the banking sector, which makes for some very interesting reading, considering some of the latest challenges that the global financial sectors are facing.   One of the areas, which I have noticed is the growth in travel to and from Brazil with TAM’s doubling of their flights, their fleet increase of 34 planes and their £1.4 billion investment in Rolls Royce engines. Sure enough BMI had this covered, plus some additional interesting tourism statistics    Another subject is the relationship of UK companies wanting to trade with Brazil, the effect of the recent Bribery Act and levels of corruption in Brazil. Sure enough there on page 2 was a lot about the pressing problems that President Dilma is facing with the resignation of the Transport Minister Alfredo Nascimento and the recent challenges with the Ministry of Tourism. All of this is especially relevant to the infrastructure investment by the government for the World Cup and the Olympics.   Finally there were some very useful comments on export figures, investment in hotels, Petrobras’s recent budget changes and Brazil’s global security rating, all of which are crucial to the increasing interest by UK companies in Brazil. Very definitely a very well spent 15 minutes and many thanks once again to the Brazilian Chamber for organising it and free of charge.   ©William Barron Creating insight August 12th2011...

Monday, 11 July 2011

“”   From the result of the informative and well attended event at Grant Thornton in London last night, the way to be “Doing successful business in Brazil” is to go to the Brazilian Chamber of Commerce events and listen to knowledgeable speakers like Martin Raven from Martin Raven Consultancy, Deborah Chobanian from Fortis Consultancy and Richard Britain from Clyde & Co. This event was the first put on by the combined efforts of the Brazilian Chamber, the IoD and CityUK, and judging by the large turnout this partnership worked well. The speakers only had twenty minutes each, after being introduced by David Stringer-Lamarre of Fortis Consultancy. Martin led the field with his eloquent discourse on what Brazil was all about - Size, Scale and Sophistication ,he followed with  the Challenges, Opportunities and Investment potential in Brazil. He laid the answer out in seven points for each of the areas. The challenges included a mixture of infrastructure, inflation, complicated Taxation and Legal System, lack of Skills, huge need for Education, the Language and some doubt on the Politics. The opportunities were about the World Cup in 2014 and Olympics in 2016, Food and agribusiness, increase in domestic consumption, bio-pharmo, automotive and Pre SALT oil. The reasons for Investment naturally covered many of the challenges and opportunities with the additions of market growth, natural resources, fresh water and the fact that Brazil was profitable. Deborah was next and she concentrated on the culture centred on the fact that Brazil was about business by people with people. This involved four key areas around: building relationships and trust based partnerships understanding the many positive facets of flexibility always be very presentable for any meeting and do keep any PowerPoint presentation short and sharp finally remember the importance of hospitality and humour when building relationships. Finally, Richard gave a three slide presentation of the legal situation, starting with dismissing the myth that doing business in Brazil was difficult but you did need to do your preparation first,decide on the legal structure you wanted right at the beginning and find a good partner. He then covered the many different legal options available from agency agreements through JV’s to the different corporate entities possible and finally described some of the other considerations like a very complicated tax system and be careful of the employment laws, which are heavily on favour of the employee. The Q&A was good with some very solid knowledgeable answers to a variety of questions, including How accepting were Brazilians of people from other countries?.... What were the implications of the Bribery Act on doing business with Brazil?.. What was the situation with local content?  … How good was governance in Brazil? … What was the best way of starting production in Brazil? So if you are interested in doing business in Brazil, I suggest you keep a weather eye out for future events by looking at the websites of the Brazilian Chamber s website, the IoD and City UK. Very informative and many thanks to Grant Thornton for the wine and nibbles afterwards. ©William Barron Creating insight July 11th2011  ...

Sunday, 10 July 2011

The “fishbowl” hot topics event yesterday on Saturday afternoon was a very interesting use of the technique, with many points being made about how much “doing or being” we should be involved with, as we progress our Transition Initiatives. There were comments about: we need to do more “doing” as the climate change problem is serious and we don’t have the time to wait around just “being” it can become very frustrating watching people just “being” when future generations depend on us to do something now and not wait around the challenge of “doing” too much can become habit forming and the adrenalin produced by the constant activity creates a rush, which can become a drug. This has other consequences apart from the potential health consequences the very action of “doing” faster and faster is part of the continuous global desire of being “on” all the time, which big business promotes so that we need to be “doing” all the time whatever we are involved with different people have different ways of behaving in that some are reactive and some are proactive, which is another way of explaining “doing” and “being” we should think about “doing” and “being” as being linked actions, with the “being” as the reflective part of the “doing” process to see if we are on the right track one of the comments from Nick Osborne was that we should not forget the importance of the spiritual “being” that creates the energy and passion for the whole Transition subject there is a real dichotomy in that we need to go slower and slower if our globe is not to heat up too much and yet to achieve this, is in a short period of time, we need to go very quickly. Later that evening I had a light-bulb moment in that we need to think about the three positions as a triangle with the spiritual “being” located at the top of the triangle and then “doing” and “reflective “being” placed along the bottom. This visual picture allows people to understand a number of things: everybody has their own size of triangle with a wider or narrower base the more we move towards one specific point, the more we get away from the other two points and the more we upset the delicate balance of our internal energy and heath we should attempt to balance our lives with all that we do, in the middle of the triangle so that we don’t become too focused to the exclusion of other parts of our lives during our journey of life we tend to develop a larger and often taller triangle the more we understand the importance of the both the reflective and spiritual “being” the triangle can work for groups as well as individuals Onwards and upwards. ©William Barron Transition Derby July 10th2011...

Wednesday, 06 July 2011

The mantra in Derby has been build offices to attract “suits on the streets” to attract big name retailers to invest in Derby and although this might have been logical under the old office working paradigms, I am unsure if this is the future. Recent studies have shown that “shopping on the streets” retail is going through a metamorphism due to society buying more and more on the internet believing that even with the postage or carriage it is cheaper than on the high streets, or even shopping centres. The only retailers that seem to be showing a profit are Greggs (fast food on the “high street”) and Dunelm (inexpensive bedding on Retail Parks). Unless you are a shopping tourist from one of the “BRIC” countries or live in London, the UK wealth is declining compared to the purchasing power of the new shopping economies – internet and smart phones. This is forcing UK retailers to look at cheaper rates and rents in secondary areas and Retail Parks, as at the moment UK shoppers are driven by not much other than price. As we cannot even rely on our taxes being redistributed by our own “shot in the foot “ Government” in the form of contracts and local jobs, it means we need to do it ourselves and unless the Thameslink contract is rethought, the earning power and thus the purchasing power of Derby will fall dramatically. Relying on our Government to save Derby by relocating the reducing numbers of quangos to new cheaper buildings in Derby seems to be a forlorn dream of the past. Not only that, but an office building in Derby is an office building in Derby and there is no differentiator between an office in Derby and another office building anywhere else in the UK, or the world for that matter. As the recent Derby City Council’s strategy is to go for “hot desking”, open plan and “work from home”, why would other companies and organisations go in the opposite direction and take on building leases in an uncertain economy. This is especially true with the “super-fast broadband” coming to give us better connectivity. Suits on the streets might have added up in 2009 and 2010 but for 2011 and beyond the mantra needs to be a new one. Investment needs to be attracted to Derby by knowledge based Hi-Tec Green Parks dotted in and around Derby, so that over time our Hi-Tec city is represented by people who are not in Rolls Royce or Toyota. If this became the mantra then Derby would invest in a hi-tec infrastructure, which supports the intellect of local people. This is crucial to implement before they start to drift away to other UK cities with better facilities, or even abroad. Maybe it is too late to save some of the money that is going to be used to build more city centre buildings but rather than look for untrustworthy government quangos or flighty organisations to fill them, why not designate these buildings as different areas of Hi-Tec. This could be exactly what happened in Nottingham with the Bio City building. If this was adopted, we would have the new buildings close to the Joseph Wright College, which could serve as the starting hub of a new Hi-Tec Derby Green/Low Carbon campus. It is too easy to design Derby’s future on old office working strategies, based on people coming together to do administration type functions as was the case. As we all know, in those days there was no internet or even super-fast broadband. The only reason for bringing people together in a building nowadays needs to be purely for groups or teams, who need to work together in the same location for visual sparking, like during idea creation or R&D, or where immediate communication is required, like money trading. It is time for Derby to wake up and get into the new office paradigm. If “Derby really does it” then it needs to do it by protecting and supporting its existing “hi-tec suits on the streets” rather than go for new “office suits on the streets”, which could leave our existing hi-tec suits on the dole. It would be a tragedy if this happened, when there are so many green hi-tec opportunities out there for the taking. In this sort of situation, the old saying of a bird in the hand is worth more than two in the bush, comes to mind. ©William Barron Creating Insight July 6th2011...

Sunday, 19 June 2011

          Last Thursday I was at a meeting of the Derbyshire and Nottinghamshire Chamber of Commerce and heard a very good report about the work carried out by the Derbyshire Market Town Forum. It centred around the research on seventeen market towns in Derbyshire as to what makes some tick better than others. It appears that it is horse for courses but there are some similarities between Derbyshire market towns and some of the UK’s city “High Streets”. Basically it is about competition from a variety of different sources: The financial power of supermarkets, especially TESCO which seems to have an uncontrollable appetite to gobble up any vacant site and build either a Metro, an Extra or 24/7 hypermarket. The immediate result is an immediate huge influx of cash to the local council and then a few months later begins the closure of local shops as they are unable to compete with low prices and the wide offer. This brings along with it reduction of retail offer, considerable emotional  problems for the family who ran the closing shop, increased unemployment and reduced business rates for the council. This is happening in the High Streets of cities like Derby and in small market towns like Heanor The growth of sales on the internet, at just over 70% last year, is sucking the lifeblood out of High Streets and Market towns alike. This will continue for ever whilst we have electricity, Broadband and a very competitive logistics sector, which provides a very efficient next day service Retail Parks are also increasing their sales provide lower prices, due to lower rents and rates, invariably have a large offer, instant delivery, the opportunity to feel, weigh, test, measure, etc.. and staff who can help with awkward questions. All of this means that there are lot of reason why Retail Parks with easy free parking are growing their sales by over 10% year on year. Finally shopping centres are taking an increasingly larger slice of the retail market as they offer lots of different variety of shops all under cover, invariably with a wide selection of food from all over the world. Shopping centres have almost become entertainment where you can buy or not as the mood grabs you The High Streets and Market Towns have therefore to find their unique offer and each place will have a different solution to the challenge of attracting shoppers and stop them being attracted by the above offers. This has to take into consideration not just what they have had, what they have now but what they could have by creating something new. In Derbyshire of course Bakewell has its tart to attract people and it does this very well and Ashbourne has it’s small upmarket shops but what does Ilkeston have now that pedestrianisation has made it difficult for shoppers to park close to the shops. The thing is that it is very important for our comfortable, soft society to make it very easy for people. Any difficulty and they will drive elsewhere.             An example of what can be created almost from nothing is Todmorden in Yorkshire at the bottom of the Peak District, halfway between Burnley and Huddersfield. Since 2009 with a volunteer Community Gardening movement they have transformed the small town with plots and allotments of vegetable and fruit outside Police Stations, in front of Council offices and on waste land. Now branded as “Incredible Edible Todmorden, there are now walks around the allotments and hey have even created the Todmorden Egg by accident. The result is that tourists come from all over the UK and other countries to find out how they have done it.. here is a video on what they have done, made by Transition Bath on a presentation about “Incredible Edible Todmorden”… http://bit.ly/localfoodbath  It lasts for about 1 hour but is split up into easy 10 minutes slots. Just imagine what say “Derbylicious”, on the same lines as “Incredible Edible Todmorden”, could do for Derby and other Market Towns in Derbyshire. ©William Barron Creating Insight June 19th2011...