Saad El-Din Group to have a LNG storage facility in Suez with a capacity of 50,000 tonnes

Interview with Dr. Mohamed Saad El-Din Ibrahim, Chairman of Saad El-Din Group

We’ll start with your general evaluation of the business environment as you are one of the groups in the private sector. What is your take on the current atmosphere in Egypt in terms of doing business?

I can say that now our country is more stable and our vision for the future has become clear after President Sisi was elected. Now the way in which the government is thinking and planning, it will be good within three years.  Before that it was the Revolution, there was no security and there was no vision for the future, but everything has changed now. I hope that after three months when steps have been taken to build our parliament and also after we have results from some projects, like the Suez Canal, I think this will be encouragement for a new future for Egypt.

We will touch upon all the remaining people involved in petroleum and gas, transport, salt mining, agriculture and renewable energy. If we could go through them one by one and if you could give us your evaluation of each of these sectors? If you could start with petroleum and gas.

We are in the LPG field and we have six factories in Egypt for filling cylinders of LPG. Our production now is almost between 150,000 – 200,000 bottles per day. We also have a big company for the transportation of the LPG from refineries or from ports to our factories. We have more than 25 semi-trailers to transport it. We transport around 500 tonnes per day, we also have a factory for building or manufacturing the cylinder itself and we almost have around 15% of the total production of the private sector and the public sector from all over Egypt. After one to one and a half years, we are planning to have 20% of the total production. We are also planning to have a strategic store for the LPG which will be in Suez and there will be around 50,000 tonnes of storage tanks for LPG. We are planning that it will be working in two years time so we will have to import what we need for the factories from outside of Egypt and produce and distribute all over Egypt.

For salt mining?

For salt mining we already have three salines. One in Arish, one in Siwa and one in Qatar and our current production is almost around half a million tonnes. We are planning to reach 1 million tonnes of salt after three years and we are planning on having a new factory for refining and producing the salt by evaporation. This will take around 1 and a half years or 2 years to finish. The production will be 150,000 tonnes per year of salt, (99.9% pure) and this will be used for medical purposes and for industries like the cheese industry; we need pure salt for that and also for people to have it on their food. We already export every month around from 30-40 thousand tonnes abroad such as to America for use in some chemicals and for putting salt on icy roads in winter. That is our salt mining sector.

What is your position of this division in the market or market share?

I think we only have public companies and our company is in third place.

And to export the salt, are you planning on adding new export markets or is it just the United States?

We don’t deal with the United States itself. We deal with some international dealers and they take it to Europe or America.

What about the agricultural division?

With the agricultural division we took a small piece of land around 300 hectares and this is in the middle between Cairo and Alexandria, it’s a desert route. We have had it more than 28-30 years now and it was desert which we have changed into a garden. It has fruit and vegetable production for the future. It is not big production but at least we can feed all the groups of our companies.

And for renewable energy?

For renewable energy we have had the Complete Energy Company for three years now and they have a joint venture with KSL, a German company, and I can say we are the first company all over Egypt to already have a project in Siwa with 10 Mega Watts of electricity from solar energy, photovoltaic and after two months when it is finished, it will be given to the government. We also have a contract and all this is due to the United Emirates financing us. I think we are going to do it well. We encourage this. We have many projects and we have submitted our service for tender and it will take place within the days following.

You also mentioned you were participating in some tenders. You have other projects? Could you describe some of these projects? Are they for 2015?

So we have some activities like we have an oxygen factory. Production will start next month and it will maybe cover the Delta and after that we can move some new factories to other places. We also have organic fertiliser from a company which produces compost from recycling plants. This is organic fertilizer. We have our company called Egyptian IT working on software and some sites for other companies and we will extend and improve all our companies as we always try to put them in a good position.

Just to talk a bit about the group – how many companies are there? I see you are very well diversified.

Around 12.

How many people do you employ?

1,800.

If you could name the key projects for next year in terms of the divisions – what are the main highlights for next year?

I would say the highlights for next year are the storage area for the LPG, and finalising the factory for evaporated salt.

In terms of international partnerships and tenders are you currently looking for anything specific?

Actually we would like to cover the local market first. After that we can export, for example with salt. We can export salt abroad. After that we can focus on LPG because we are careful now to produce the factory itself here in Egypt.

I’m referring here to the projects, what do you have in your plans for next year? You mentioned for example the Emirates are giving you finance…

The Emirates give us finance for the government not for our group. They give finance to the government. But actually we have many projects here, it’s good and they need financing. Therefore we will be looking at having some external partners to finance some projects and to co-operate with some people who can finance us for big projects which we can carry out in Egypt.

What do you contribute back to the community?

From my studies, I have a PHD in crisis management. There are many crises in Egypt and I try to provide the government with solutions by meeting with people, through the media, newspapers and through visuals on the TV. I try to solve all these problems and give solutions to people who are in the government, to try to solve them. I am a board member for the Federation of Industry and the president for the energy committee.  I am also on the board for the Investors Union all over Egypt.  I am vice president for the Chamber of Oil and Mining and also chief investor in LPG factories. Most of these positions allow me to try to serve all the people who are in all these fields, to solve any problems and to try to help them integrate together, face problems and find solutions with the government so we can improve our production in every way.

As you are a member in many business councils and business associations, could you talk about the cooperation between Egypt and Turkey?

Actually, I am a member of the council of Egypt and Turkey and also Qatar.  In the past years we have had many meetings in Qatar and here to try to solve problems. At that time Qatar was helping Egypt with some funds and now some investors are building some factories here in Egypt. At the same time we have some people working in Qatar and they have some factories and contracts there. We solve many problems for them and we were on our way to increasing the investment from Qatar in the government and people of Egypt. In the end we’re still having this problem. I think it’s been frozen like that for some time but I’m hoping in the next few months everything will return to how it was and be alright again.

At the same time we have collaborated with the Turkish council for a long time. The problem between the presidents of the countries should not affect the people in terms of commercial matters. This is my target. Political people today are friends but tomorrow they might not be friends but this should not affect businesses and trade between countries because if I have a factory in Turkey or I have my own factory here for Turkish people, it’s not right that when the President says something I have to close it. I am not like them.

You don’t stop.

No, no. Political is political. If something happens due to the President the President can answer for that, not for the people.

So is it on a different level?

I mean that the public and I should not deal with these things. People have either commercial or non-commercial relations, but do not interfere with political relations because politicians are always changing but you can’t change the relation between commercial people because you can’t just close the factory which employs Turkish people, for example. They cannot close my factory there. We have many people working in Qatar. We have some people investing here so that should not be affected by any political problems.

What is your vision for the group?

For myself, or as a group I hope that we can transfer any technology from outside to the inside of Egypt that can increase our production and that we can make profit for those who have the technology and make profit for those who will use the technology. So I hope to have co-operation with any nationality all over the world and that it can bring benefits for us and for them. We didn’t say yes to one country and no to others, even Israel. I’m open-minded. I advise our government for that- don’t have any enemies, let everyone be friends, let’s have benefits for everyone and no problems.

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