This Article by Ross Davidson appeared in the Business Section of the P&J on 21 December 2011.
Despite being warned he “must be stupid” to start his own business, James Paton had faith in what ADIL could achieve.
The oil and gas consultant’s managing director established the firm in 2006 and has spent the past five years proving his doubters wrong.
Aberdeen-based ADIL (Asset Developments and Improvement Limited) has increase its workforce from 30-100 in the past year, having launched with five founding members.
Turnover is expected to be £11.5 million this year, up from £4.5 million in 2009, and in the past two years alone the company has won contracts worth more than £15million.
The deals secured cover various projects in the UK continental shelf, including subsea tiebacks and greenfield development west of Shetland.
For Mr Paton, the company’s success is the reward for the risk he took when he left his post as a development and production manager at Paladin Resources.
With his fellow directors, the 41-year-old invested his own money in the business without any financial backing from other sources.
He said: “I had a lot of confidence that we could create a reasonably successful business.
“I saw smaller oil companies were emerging in considerable numbers and their shortage of resources meant we could provide project management services to multiple clients and give them an efficient solution.
“Before we started up I spoke to around five chief executives of small oil companies and they gave tremendous advice about what could or could not work.
“Some of those people I spoke to became our first clients, so I feel incredibly indebted to them.”
Despite managing fields with as associated capital investment of over £1billion, Mr Paton said he was still considering ways for ADIL to grow.
The business already has staff supporting projects in the Netherlands, Romania, China and Middle East plus an office in London, but Mr Paton said the company would expand its geographical reach by adding bases in new locations such as Australia. ADIL is also considering a move to the offshore renewables market and has decided to sponsor Elgin student Cara Heller who is studying for an MSc in renewable energy at Aberdeen University, after recognising a skill shortage in the industry.
Mr Paton said: “The work we have done has indicated we can transfer our skills from oil and gas to renewables.
“We will have to keep an eye on the cost base because… they are probably at the high-end of what renewables companies will accept, but our experience in operations management will be particularly relevant for offshore wind, wave and tidal energy and we intend to progress into that industry over the next year or so.”
ADIL has also put forward a plan to avoid the prospect of marginal fields being lost to future production.
It involves groups of acreage owners working together to share facilities, for which they would pay a tariff and would be funded and built by an independent third party. Mr Paton said “It is a substantial undertaking for a company of our size but it is something we feel needs to be dealt with in the North Sea.”
He was born and brought up in the north-east and was a pupil at Cults Academy before studying at Aberdeen University.
His childhood was spent on his uncle’s farm near Netherley, which he described as “a wonderful experience.”
His first job was helping out around the farm, which was rewarded in an unusual way.
Mr Paton said: “I worked for my uncle for about three years feeding cattle and so on. He was very generous and at the end of my time working for him he took me into one of the cattle sheds, pointed to one of the cows and said it was mine.
I still have the money from the sale of the cow in a building society savings account; it taught me a lot about waiting for the real value of things.”
Mr Paton now lives at Chapel of Garioch, in Aberdeenshire, with wife Debbie and four children: Lewis, 12, Jennifer 11, Evie, age three, and two-year-old Cameron.
He worked for Hess for more than 10 years before joining Paladin, so he knows the difference between working for the industry’s biggest companies and some of its newest players. Despite ADIL’s recruitment drive in recent months, the managing director said working for the consultancy was still very different to life at an established international oil and gas firm.
He added: “It is quite humbling that people who worked for major oil companies are now joining a consultancy of 100 people, mainly because they believe in what we are trying to do and the values of the company.”
Mr Paton also stressed the importance of ADIL’s values to the future success of the business. He said: “I am proud of what the guys here have achieved in the past five years and what we have achieved collectively.
“The values of the company are quite incredible and this is what will allow us to grow. Whether ADIL was a financial success or not was not important.
“The most important thing to me was strong values and a fantastic team in support of what we are doing.
“If you get those things right the financial side falls into place.
“I was told I had to be stupid to set up my own business and I have felt at various times that was a pretty wise statement, but I have kept faith in the company and kept pushing on.
“I am proud of the business’s organic growth and where it is today.”