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A tale of two fabricators C ompanies and
C ontact organisations covered
T hurs day, 2 February 2 0 1 2 during the past 30 days -
Video James M c G rath more

Surveys MARK Taylor, managing director of Darwin-

Help based Fingers Specialised Metal Fabrication is
spending a lot of his time lately talking to the
Manage Members C om pa ny Sea rch
media.
Company Name
Jobs Board
Aside from answering EnergyNewsPremium’s queries, Industry
he’s fielding calls from local media and taking TV
crews around his workshop in East Arm as the Keyw ord/Description
excitement over the Ichthys LNG final investment
decision begins to build.

“It’s really just started because the whole of Australia STORY IMAGE SLIDESHOW
has been in a recession for 18 months and it’s been Story Sea rch
very tough … a lot of businesses have gone to the Type Text Here
wall,” he told ENP.
Section
“They’re starting to talk about the project now in the
town. About two years ago I said Inpex is going to Commodity
come, no matter what. As soon as WA lost it to the
[Northern Territory] government I knew it was going Region
to come here.
Feature
“So I spent a fair bit of money trying to get us into
this situation, and people questioned that, but I took a
punt and it’s come through.”
Advance d Sea rch
With previous clients including PTTEP, Fingers has
been around for 18 years and is in the middle of Industry Search
preparing accreditation documentation to submit to
FEED winners JGC C orporation, KBR and C hiyoda
C orporation and to Inpex itself through the Northern
Territory Industry C apability Network.

While the contractors on the EPC have yet to be

announced, it’s the start of what is expected to be a
groundswell of work for fabricators, engineers and
other services thanks to the Ichthys project.
RELATED COMPANIES
As C hief Minister Paul Henderson told assembled
OGM ENGINEERING
media and dignitaries at the final investment decision
Wells Reports
announcement: “Never before have we seen a
project of this scale in the Northern Territory. A 2-May-2012
project with the potential to change so much, and
change it for the better.” 26-Apr-2012
18-Apr-2012
There’s no doubt building a $US34 billion, 8.4 million
tonnes per annum LNG plant in Darwin is going to 11-Apr-2012
change a few things. 4-Apr-2012
more
The project itself is expected to employ 3000 to build
the facilities at Blaydin point. For Taylor, it’s been part
of his business strategy.

“We’ve attempted to develop in conjunction with

Ichthys and Shell Prelude, those projects have kind
for been the driver for us,” he said.

Taylor is planning to ramp up his staff to roughly 100

at peak if it were to win work on Ichthys, and has
already started talking to employment agencies, both
international and domestic, about sourcing workers.

But the buzz doesn’t tell the whole story.

Kim Fox, director of OGM Engineering, whose

workshop is metres away from Fingers’, told ENP that
the likes of Ichthys and Prelude aren’t going to be a
magic bullet for the state’s fabrication sector.

“It [Ichthys] means ongoing work for the next four or

five years … there are a whole heap of challenges
with that though because there’s not a whole heap of
skilled labour around the place at the moment. The
government is making it very difficult to do business
as well,” he lamented.

Of course, the Territory government would beg to

differ on the last point.

It points to a number of initiatives on training and

jobs, the latest of which will see the NT government
canvass both employers and employees in the region
for their input into the Employment Strategy
Discussion Starter.

Acting chief minister Delia Lawrie said discussion was

Acting chief minister Delia Lawrie said discussion was
needed as the NT emerged as a resources hub.

“The Territory is set to emerge as a resource

development and export location, creating more
demand for skilled and semi-skilled workers and new
business opportunities,” she said.

“We want to put Territorians in the best position to

grab these jobs, and give Territory businesses the
best chance of securing the labour they need to grow
and prosper.”

Taylor concurs with Fox’s assessment that it can’t

currently source enough workers from the Territory
or even nationally, with the majority of discussions
with employment agencies taking place
internationally.

Fox though, has deep reservations about the type of

workers any domestic-based training program will
churn out.

“I take those training opportunities offered by the NT

government with a grain of salt really. What we’ve
found since they’ve bought in competency-based Industry News
training is that the kids aren’t serving a full
apprenticeship,” he said.

“They’re rushing people through the system, and

when they rush people through you get semi-skilled
people with no experience, while the reason to do an
apprenticeship is to get skills and get experience.

“They’re going in, doing a week’s course or maybe a

three-month’s course and walking out with a piece of
paper but they’ve got no idea about how a workshop
operates, what to expect, how to act, all that sort of
thing.”

Both Fox and Taylor say the growth potential for their
businesses out of potentially winning work on the
Ichthys project will be severely curtailed for the
simple reason most of the work will be done by
overseas operators, with the local companies merely
putting the pieces together.

“I don’t think winning Inpex work will put us in a shop

window, because all we’ll be doing really is getting
scraps off the table because Australia has priced itself
out of the international market and all I see local
companies doing is repairs and maintenance, or basic
fabrication,” Fox said.

“There will be a lot of work to come out of it, no

doubt, but when the build is actually done it will just Subscribe | Advertise
be repairs and maintenance.” FREE TRIAL!
Taylor backed up the sentiment.

“Only a few of us up here can actually do the amount

of work they’re talking about. Everything will be built
overseas and a small portion will be built in Australia.
We will be the people on the ground. When it comes
to putting all the different components together, that’s
where we’ll come in,” he said.

“Australia simply doesn’t have the fabrication it used

to have. It’s all gone overseas, and that’s dollar
driven.”

In fact, Taylor said if it weren’t for an Industry

Participation Plan signed by Inpex back in 2009, local
companies wouldn’t get much of a look in.

“While we can compete in Australia, we can’t compete

internationally. I know there is work which is being
committed to having to be built within Australia as Subscribe | Advertise
part of the project … so we’re looking to complete for FREE TRIAL!
those projects,” he said.

“If that work commitment wasn’t there then I don’t

think we’d be able to compete and that’s simply
because our rates are too high.”

While both say it will be nigh on impossible to get

local fabrication out of its funk, there are
opportunities for smaller fabricators to fill a niche
market on major projects, but it’s going to get
tougher if inflationary pressures from Ichthys are felt
throughout the local economy.

The NT government is trying to address this, by

building a workers’ village in Darwin.

The government said last month that it was calling for

proposals to develop the short-stay village, on a site
which can currently support 250 people with room to
grow.

“The territory government is committed to ensuring

our bright future does not drive up the cost of living
for Territorians, and has planned extensively to
accommodate the influx of workers expected,” acting
C hief Minister Delia Lawrie said at the time.

According to Fox though, this is akin to locking the

gate after the horse has bolted.

“They’re [NT government] way behind on housing

which has driven the price of housing up through the
roof, the rents through the roof, and that doesn’t
roof, the rents through the roof, and that doesn’t
attract the staff needed to work on these projects.”

That’s why he said the average Territorian, and those

in the fabrication business are treating FID on Ichthys
with cautious optimism.

While Ichthys will invariably bring in work, the work

will be needed to keep up with the inflation 3000
cashed up workers will have on the Darwin economy.

“More broadly it has been viewed as positive but

there is a lot of negativity going around about it as
well about the sort of effect it’s going to have on the
social and economic side of things,” Fox said.

“There’s a bit of concern about the cost of living going

up and the sort of people this sort of project is going
to bring into Darwin.”

So while Ichthys will be talked about breathlessly by

the NT government keen to talk up the transformative
effects of the project on the Territory, for local
suppliers and fabricators such as Fingers and OGM,
the net gain may be hard to see.

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