Billionaire Who Built his Business on Sand

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Eruani Azibapu

Posted November 20, 2018

At the glass house office of Azikel Group of Companies in Ogbogura community of Bayelsa State, the staff are few. But the traffic of tippers loading sand at the dredging site, to a discerning eye, tells the true story of the business that has catapulted Dr. Eruani Azibapu, president of the group, to high-class businessman and entrepreneur.

Growing up as a little child, his friends used to call him Azikel boy, and years later, his company was named Azikel.

At 44, he is on good track, but he set a record by buying his first helicopter at the age of 35, turning a billionaire at 34, graduating as a medical doctor at 27, and becoming the youngest commissioner for health in the country.

From the business of selling sand, he later diversified into aviation and now, petroleum, working to build the first functional private refinery in Nigeria.

Born on a Christmas day, December 25, 1974 in Emadike in Ayama district, a local community in Bayelsa State, life itself and growing up in this serene farming and fishing settlement was quite interesting for the village boy.

His mother was into fishing and farming, while his father, HRH, Chief Allwell Eruani Aguda IX, the Obanema of Emadike Kingdom, was into business.

Although his father had seven wives, Azibapu, who is his mother’s only surviving child, recalled that getting his father’s attention was quite competitive and interestingly challenging, with the usual rivalry, as all the wives and children competed for interest and who was going to be the most favoured.

His mother always wanted to have more children, but she never did, so, Azibapu from infancy set out to prove to her that it was not necessarily numbers that matter, but that one person can make a difference, and since she couldn’t have more children, he was going to surpass her, as he now has five children.

He had his primary education in his village, which though rural and lacked infrastructure, had very good and well-trained tutors. Primary One and Two were under the tree, but he enjoyed it.

He moved into the classroom of sort in Primary Three, shared the town hall, partitioned with mat in Primary Four and some sense of shelter in Primary Five and Six.

Secondary school was at a bigger community called Okodi, which he attended daily by canoe, usually sourced and paddled for about 45 minutes to one hour by the students themselves and being in a different community, they sometimes returned home very hungry.

Princehood conferred some village rights on him, but not at school, in another community. His father had a Yamaha speedboat and took him to school when he was really late, but he didn’t make it regular. He preferred the young boy should go through the rigours of going to school like his peers. Now, Azibapu sees the sense in what his father was doing.

He attended the University of Port Harcourt, where he graduated as a medical doctor, because he wanted to come back and provide healthcare for the people and himself. He used to have catarrh and was thinking of finding the cure to it. He is yet to accomplish this mission.

On graduation, he worked as a medical officer in the civil service and some private clinics in Port Harcourt, the Rivers State capital, and later sought further education and specialisation, starting in surgery at the University of Port Harcourt Teaching Hospital, then travelled to the United States (US) and took interest in family medicine and later became a member of the American Academy of Family Physicians.

Azibapu also worked in Bayelsa State as a medical officer. But when he became a member of the American Academy of Family Physicians, he secured employment in Nigerian Agip Oil Company as an expatriate, basically providing occupational health services. He rose to the level of a deputy chief industrial doctor.

Then, there was clamour for him to come back, as the government of Bayelsa State needed some experienced doctors to revive its health sector.

The then governor, and later President, Dr. Goodluck Jonathan, appointed him as adviser on HIV/AIDS and Community Health and he was appointed commissioner of Health by Chief Timipre Sylvia, who took over from Jonathan.

After serving as adviser for about two years and commissioner for about five years, he felt it was time to go, because even though he achieved some success, the desire and things he could achieve were limited, particularly with the political nature of most of the offices, as he couldn’t bring to bear most of the things he would have loved to do.

So, beyond medical practice, he decided to explore other areas. His mind was on how to alleviate the housing and infrastructural deficit in the state.

He went into an area that was considered not befitting, but today he is a billionaire from a business built on sand; sand selling.

At the outset, not many people wanted to work with him. In fact, when he told his mother that he wanted to go into selling sand, she wept, that her son and only child, a medical doctor of international repute and commissioner was going to start selling sand.

But Azibapu had always known that one could actually make a good business from what many people didn’t like. And he found encouragement in his father, who said he believed in whatever he wanted to do.

He wasn’t going to do the ordinary kind of selling sand; he made some critical investments, got a good network of people and today, the story of his selling sand remains unique.

He reminisced: “I looked at the critical drivers of that business – I needed to have land and a dredging machine. I couldn’t afford to buy a dredging machine, because it costs millions of dollars. The cheapest dredging machine as at that time was nothing less than $10million.

“I needed to get land by the riverside. I could go to a community to get land and even if I cannot pay at once, I can pay overtime, and that was what I did. I went and discussed with the Otuogori community and they agreed. That is where my operation is based, more so, it was a vacant land then, as it was always submerged under water.”

Solving the problem of dredging machine was more challenging, as he didn’t have the money to rent a dredging machine, let alone buy one. “So, I approached someone I know has a dredging machine, who remains very famous in my history, called Akpe. I asked if he could pump some sand for me, and he agreed to do so if I was willing to pay.

“From the bill he gave me, I needed an initial deposit of about N80million. I didn’t even have up to N10million. I tried to bargain as much as I could, but it wasn’t forthcoming, so I accepted it, despite not having the money.

“But I said since he wouldn’t need the whole N80million at once, we should have a payment plan and I proposed N80million to dredge about 100 feet of sand and offered to pay him N5million deposit to mobilise a dredging machine to the site.

“I was able to muster about N10million, so while he was there, I could pay him another N5million. So, when he pumped the sand and we quantified that it was worth N10million, I paid another N10million,” he recalled.

It was not surprising that he got that business acumen, as his parents were traders and he observed what they did, coupled with his father also into bread baking and poultry farming.

“Akpe bought into the idea. My strategy was that by the time he gave me sand of N10million, I would start to sell the sand to pay him as much as he was producing. I paid and we started the deal; it was a win-win. He mobilised the machine, I paid the first N5million and we started pumping the sand. I quickly learnt from what he was doing and that this business was going to be very interesting and successful, but would be sustainable and I will be able to guarantee the market if I could own my own machine.

“We dredged and when it got up to the target, I made the payment and I started selling the sand immediately. He wanted to raise issues, but I said there was no issue to be raised, because the deal I had with him was N800 per trip, but I sold at N1600 and because I organised the market in a formal way, I had a lot of attraction.

“He knew the price and that I was making double the amount, so he said he wanted to change the price and I reminded him of our deal and that it is just for him to move to the next milestone and we would pay him. He tried to move to the second milestone, but he couldn’t move at the pace my clients were.

“I was able to penetrate the market very fast in a very short period of time and garnered about 95 per cent of the market share and I realised very quickly that Akpe could not meet up with the demand that I have, as more people were coming to me for sand. It got to a point where some people came to convince Akpe to leave me, saying I was cheating him, despite the fact that I was fulfilling my obligations. So, Akpe had to quit, saying he didn’t want to do the work anymore, that he had a better contract elsewhere.

“So, my feet came back to square one and I identified that one of my weakest points was not having a dredging machine, so I began to think of how to acquire one.”

So, after about one year, there was a vacuum, as getting his own dredging machine took a while.

Azibapu had already saved some money and having been known for the business, he used that goodwill to get other supplies, who were not as reliable as him being in control.

It took him about three to four years to muster enough resources to get a dredging machine, with support from local banks, such as Guaranty Trust Bank Plc, which gave him the first loan, but most of the critical investment in the business was from the US Exim Bank.

“I was able to cross-reference abroad and I was supported by the bank to acquire my first dredging machine. So, I pulled operations and soon broke barriers. I made the business much more sexier than anyone in the turf. In the Niger Delta, Azikel became a household name, as the federal and state governments, international companies, oil companies, e.t.c. came to us to buy sand.”

Asked how he hit it at an early age, Azibapu explained: “It is influence, largely environmental influence. The environment is not where you grow up; it is the people that you meet, your perception and the people that are around you. When you are purposeful and you have success written around you, you are likely to succeed.”

On how he overcame the challenge of raising the capital for the business, he stated: “Raising money is a critical factor to most people that dare. For example, raising $300million for a business could be a challenge to you, maybe even an impossible task, but to me, it is not, because I know that it is there.

Having that knowledge is a big difference, and I got that knowledge from the environment I grew up. I know people that raise a million dollars, I see it happen and that influences me. So, financing is not a limitation to doing business.

“Most people will say they want to start a business, but the problem is finance. For me, finance is not a problem, because I can get the money. I have gotten money in dredging and aviation, so it is not a problem. I don’t think about financing. The thing is information and knowledge.

“I secured my first financing in the dredging business, $15million, and another $50million from the US Exim Bank. Someone told me I didn’t have to bring all the money to buy the machine, that if I brought small, they could get it and do it. I asked if it was possible and it happened.

“All my guarantees were self-guarantees and that is why networking was very good. When I was raising $50million, I signed a guarantee, but with a caveat of asking someone in Nigeria if they knew me. And who did they ask? Alhaji Aliko Dangote. He put in good words for me and I broke that barrier of financing.

“I can get money anywhere in the world, there is no limitation and until you understand this, you would think otherwise. There is huge money in the world that people are looking to put into getting little gains, so you must be real and believable and be true to yourself. This was how we evolved.

“We are spending about $300million on the refinery, it is not a big deal to raise the money and that itself is not a challenge, if you are credible, reputable and have the facts to show for it.

“I took advantage of the relationship I had with the US Exim Bank. I didn’t stop at buying one dredger; I bought up to six dredgers.”

The dredging machines have the capacity of moving around the Niger Delta region and today, Azikel operates in Bayelsa, Delta and Rivers states.

The business soon evolved into a multinational industry and there was the quest to diversify, this time into the aviation sector, starting with a small aircraft.

It was a natural choice for him, having worked with oil companies in the Niger Delta, with its difficult terrains, where airlift is imperative.

He knew that logistics was a major challenge and the oil majors and VIPs needed helicopters for easy movement, and sometimes sourcing for helicopters to hire used to be very difficult.

“So, I took advantage of that and bought a small aircraft, initially to break barriers. I wanted to get into a wider network of successful people and I didn’t have those that would introduce me, so, I needed to introduce myself and I couldn’t just introduce myself as Eruani; I needed to do something that could be outstanding that can leverage my relationship with all the other successful people.

“I had the resources to buy an aircraft, so I bought a helicopter and I quickly noticed that my friends were always asking me for free flights, wanting me to drop them in Lagos and Abuja and I said that was okay.

“There was this particular day one of my friends wanted to take a ride and I told him I didn’t have money to buy fuel, which was true anyway. He offered to buy the fuel and I said, ‘when we get to the airport, just buy the fuel,’ but he said he didn’t want to go through those rigours of buying the fuel, because he was more comfortable with giving me the money. I said I didn’t want to trade with him. He asked me the cost of the fuel was and I just made a guess of $9,000 dollars and he said it was okay, opened his briefcase and gave me the money with ease.

“I said this is very interesting, I sat back and called the airport and we were able to get the aircraft fuel for $5,000 to and fro. There and then, I made $4,000 and decided that if anyone was going to fly with me, he/she would buy the fuel. That was how my friends became my customers, by buying the fuel.

“I then realised that I needed to make that a viable business and that was how I registered as Azikel Airline and my friends started calling to know if I also had an helicopter, and I said I did.

“I would arrange for helicopters for them. Because I was into a wider market, I could leverage and get other aircraft and a lot of money was coming in, as the oil companies were also calling me. I thought I needed to invest in more helicopters, so I bought helicopters as well. That gave me a full-fledged business into aviation.

“I was providing VIP and shuttle services for the IOCs. I saw it was good, so I legalised the business, got an airline transport certificate and licence, as well as air operation certificate for Azikel Air, acquired two other aircraft and more helicopters and set about the business of being able to move people within the Niger Delta.”

Today, Azikel Air has four aircraft in its fleet, but had to scale down the operations in 2015 following the lull in the market. Many people could not afford executive flying and shuttle services. But Azibapu still flies around in one to make business easier for him, much as Azikel Air is supporting a lot of the group’s internal operations in the Niger Delta and across the world.

Like many airline and aircraft owners, Azibapu also takes flying as a hobby, especially as a trained pilot. He explained: “When you own an aircraft, the world is different from the way other people look at it. I look at the world very differently; I don’t see boundaries in the world. I have the leverage of going to any part of the world any day, anytime at will and there are no barricades.

“I used to be scared sometimes of turbulence. I am a licensed US pilot for rotorcraft, which is helicopters and fixed wing, and I fly both. In the US, for example, flying is fun, but in Nigeria, it is a luxury. I enjoy it, although a lot of people say it is risky, but I don’t see any risk in it, as the principles and safety of flying are well understood. That is my hobby. When I am in the US, I fly to locations to go have breakfast and I have friends in the flying club.”

Has he had any experience while flying that gave him some jitters? He said: “Turbulence is normal, it does happen, although some are much more severe than others. Otherwise, flying is reasonably safe. Everything in life has its own risk, but aviation is quite safe, as there are laid down principles and procedures.

“I like flying my own aircraft in Nigeria, because I understand what goes on. I also trust what my pilots do and the Nigerian pilots do very well too. I have my own hangars that I go to at will to inspect the aircraft, so I participate in what they do. To me, it is like we all know what we are doing and because of my knowledge.

“Before I got licensed, I had some interesting fears, but that is by the way. What then was catastrophic wasn’t really catastrophic; it was because I didn’t really understand what was happening, but now I do.”

After aviation, he went into the power sector in 2014 during the privatisation of the sector. He bid for the Ogbara power plant in Bayelsa, did everything he could, partnered with international participants, but lost, not just the bid, he lost it with over $5million in what he called a very transparent process, for which he gave kudos to the government.

When he lost the bid, he felt he could participate in a greenfield and launched Azikel Power Limited for a greenfield refinery of 500 megawatts. He pursued the licence, but didn’t succeed, so the project got stuck.

He secured about 50 acres of land close to a source of gas and close to evacuation, but couldn’t secure a licence. He got frustrated in the process, as the project didn’t get to fruition by the end of the President Goodluck Jonathan administration, so he froze it, but was still committed to industrialisation, the entrepreneurial zeal was still very much in him as he strove to bring the desired change in the world by creating employment.

So in 2015, when the President Muhammadu Buhari administration was about to issue licences for private/modular refineries, Azibapu stood up to be counted. He participated and was one of the first two Nigerians granted licences to build refineries.

He told the story: “I was so excited about it. To come from the Niger Delta where there is abundance of crude oil, where I saw the exploration of crude at my backyard and for the first, we are given the right and privilege to take possession of that crude oil, according to the licence, add value to it and make commercial, economic and entrepreneurial benefits from it was very delighting.

“I was eager to make this possible and I went into the process of building the very first private hydro-skimming refinery in Nigeria and we launched it. I acquired the land when I was trying to construct the greenfield power plant, so all I needed to do was go back to that 50 acres of land, divide it into two and dedicate one part for the refinery.

“It is situated close to Shell, which exploits and exports crude oil from the gas facility and was finding ways of dealing with it, so it would easily be a feed stock from Shell. I was licensed for a 12,000 barrel as phase one refinery and I am bent on ensuring that the refinery was built .

“We commenced the foundational development investment, which is very challenging. I must say having been in this journey for a few years, it is very challenging, despite the huge success we have achieved. We are going to produce petrol, diesel for heavy-duty machines, LPG, jet fuel and kerosene for home use. We have developed that to a very significant extent.”

Source: The Guardian