Featured in Oilweek Magazine

Oilweek Magazine, Canada’s oil and gas authority, profiled Bilal Hydrie in its Faces of the Industry feature under the headline “Flexible Financing — Bilal Hydrie’s storage tank business prospers by creating opportunity.”

“Buy low, sell high.” That is one philosophy Bilal Hydrie has employed to grow equipment supplier Inclusive Energy through the oil industry downturn. “This year we spent between $8 million and $10 million on equipment,” he told the magazine. “On all that equipment, we paid 30 to 40 cents on the dollar. As soon as things start picking up, there will be a good return on our money.”

Surplus storage tanks and equipment account for about 75 per cent of Inclusive Energy’s revenues. Hydrie says there is about $25 million of equipment sitting across three Inclusive Energy yards in Alberta, with good prices, great service, and in-house financing keeping things moving even as revenues sat at half their 2014 levels.

Backing customers with capital.

The answer to making $10 million of equipment purchases during a downturn was private equity. Hydrie comes from the family that controls the Habib Group, a century-old enterprise with businesses in banking, insurance, manufacturing, and trading, employing some 30,000 people worldwide.

“So if a customer needs funding for their projects, we can also fund up to $10 million in a joint venture,” he said. “We recently did that with one company in Lloydminster. It’s a disposal facility. We supply all the equipment and take care of the licensee liability rating, and once the company starts generating cash flow, we can start getting royalties and a return on our money.”

A one-stop shop built from a gap.

After graduating from SAIT Polytechnic with a chemical engineering diploma, Hydrie worked in Alberta’s oil and gas industry for a few years and saw firsthand the inefficiencies in storage tank fabrication. In 2009, he decided he could do better. Inclusive Energy’s formula was a one-stop shop: design, custom fabrication, delivery, set up, repair and reconditioning, sales of new and used equipment, and financing if needed.

The company found its niche and grew, then oil prices collapsed in 2014. Hydrie refused to see the downturn as anything but opportunity, cutting overhead and adapting to weather the storm. “In 2008, people started panicking, went out of business. But by 2012, oil prices were back above $100,” he said. “Those people who didn’t explore opportunities are still out of business. People who took the risk and hung on have done amazing.”

Diversifying into private capital.

A network of business mentors and associates guided Hydrie to diversify into wider business interests. He became an independent director of Pennine Petroleum, a TSX-listed company, and as director of North American operations for the Habib Group he gained access to sophisticated private investors in the Middle East, leading him to become the executive director of Global Centurion Investments.

“We put together a very large fund for Alberta only that’s $25 million. It’s all private money. No public money involved. We’re looking for great opportunities to invest that money. We’re looking at all different sectors, whichever makes sense,” he said.