"The Gabonese people have been in the petroleum industry for 50 years, but what they may not yet see is that 20 years from now, the petroleum sector will not be the same. A shift in mentality is well due, and the need to diversify the economy is necessary."

Daniel Cormouls-Houles & Dominique Grimaldi

DIRECTOR, BRANCH PORT-GENTIL & DIRECTOR, BRANCH LIBREVILLE - GABONAISE DE CHIMIE

June 08, 2020

Could you please introduce Gabonaise de Chimie to our audience worldwide?

D.G: Gabonaise de Chimie was started by two businessmen, one French and one French Lebanese, back in 1991 when founders took interest in francophone African countries, opening subsidiaries in Senegal, Cameroon, Burkina Faso, Mali, Congo and others; today summing 12 entities worldwide. In Gabon, specifically, we are an independent company. Our main activity is in water supply to the chemical industry, but we also serve the beverages, forest, agriculture, petrol, and mining industries, with the aim to bring added value in a country where almost all goods are imported. Our challenge is then to supply things that will allow the country to both transform and create resources. 30% of our activity goes into agriculture, forestry, and poultry, with 12 small shops in the country. Petrol activities are led from Port-Gentil, and we are supplied by European, Asian and American companies. For the petroleum side (which represents about 25% of the business), we provide commodities, such as solvents to help the oil become fluid in the pipe, methanol and ecological detergents for sea platforms sold in large quantities. Among our clients we note Assala, Total, Perenco, and many others.

Could you provide an overview of your operations and your main product offering for the oil and gas sector?

D.H: Gabonaise de Chimie has been in Gabon for 29 years, starting with agricultural products, chemical products and commodities for the petroleum industry, after which we entered into a different product class of specialty chemicals, in accordance to market demand. Our model works through a network of partnerships with suppliers in Europe; partners who we represent here in Gabon. Among our partners we have names such as REP, Nalco Ecolab company, Savana and Dupont. These companies choose Gabonaise de Chimie over importing directly from the United States or Europe because we put at their disposal great storage facilities in our warehouse, enabling large scale trading. Our competitive advantage is that we bring everything together and provide our customers with a bundle of products as required. We have contracts to import, stock and deliver. Our clients range from the main producers, like Perenco, Total, Addax and Maurel et Prom, to affiliate subcontractors and service providers.

How has demand in the petroleum sector fluctuated in the past decade?

D.H: From 2010 to 2014, the business saw plenty of activity in the petroleum industry because of the high price of petrol. After this period, the business entered decline and many companies left Gabon as a consequence. The key to Gabonaise de Chimie’s survival is its diversified portfolio in other areas, such as agriculture and equipment. In the last two years, business has improved and is back on track, however the boom of 2010 will not return. Those four years were certainly a bubble waiting to burst.

How has Gabon recovered since the 2014 oil price crisis, and what are the prospects moving forward?

D.G: What is happening today is the downcycle episode; after four to five years of growth, the negative cycle starts again. Gabonaise de Chimie has learned to remain resilient and perseverant, but it is a tough industry to be in. We have been in Port Gentil for 17 years and our team is highly involved in the social life, offering a continuous service from generation to generation.

What do you think about Gabon’s potential to diversify its economy and to develop its other economic sectors?

D.H: Gabon must invest in areas such as agriculture, especially considering that many of its foods come from Cameroon. The shift, however, could be difficult because Gabon’s population has a long tradition with the oil industry and people do not see themselves in agriculture. The Gabonese people have been in the petroleum industry for 50 years, but what they may not yet see is that 20 years from now, the petroleum sector will not be the same. A shift in mentality is well due, and the need to diversify the economy is necessary.

What are the challenges you face as a business in Gabon?

D.H: Doing business is difficult because we face uncertainty. It is essential for businesses to have economic and fiscal certainties, and therefore more stability. Foreign companies must have confidence in the stability of a country in order to invest. For the last two years, we have also faced problems with the foreign exchange regulation and most companies in Europe lack the confidence to export to Gabon because they have no assurance that they will be paid. The government needs to earn the trust of new investors so that they come to Gabon; this is the big challenge in coming months.

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