International Conference on Science & Technology: Applications in Industry & Education (2008)

TECHNOLOGY TRANSFER AND ADOPTION IN THE LIBYAN PETROLEUM INDUSTRY: A REVIEW

1

A.S.Mohamed, 2Megat Ahmad M.M.H, 3A.M.S. Hamouda, 2 Sapuan S.M.

1 Numerical Modeling Laboratory, Institute of advanced Technology, Universiti Putra Malaysia, 43300, serdang, selangor, Malaysia Department of Mechanical and Manufacturing Engineering, Faculty of Engineering, Universiti Putra Malaysia, 43300, serdang, selangor, Malaysia 3 Mechanical and Industry System Engineering, Qatar University, P. O. Box 2713 Doha, Qatar 2 Department of Mechanical and Manufacturing Engineering, Faculty of Engineering, Universiti Putra Malaysia, 43300, serdang, selangor, Malaysia mabruk@hotmail.com, mmegat@eng.upm.edu.my, hamouda@qu.edu.qa , sapuan@eng.upm.edu.my 2

Abstract. The task of technology in the petroleum industry is a very important role. More than ever as the price of oil and the cost of oil production are increased dramatically in recent years. Notwithstanding, most oil-producing countries are committed to develop its petroleum industries so that become competitive, compatible and reliable. This often involves the establishment of technology transfer infrastructure considered necessary for the petroleum industry. Nevertheless, most of these countries lack the managerial and technical expertise to manage such large projects. On the other hand, that the petroleum industry is slow to accept and adopt new technologies. In this paper, we shed light on technology transfers in the Libyan petroleum industry, modes of technology transfers, difficulties and why some technologies are still not accommodating the adoption process in the Libyan oil industry. Moreover, we analyze the significant indicators, and parameters of the adoption results of the technology transfer and several legal, economical and technological factors influencing them. The results derived from a recent survey conducted on the technology transfer in Libyan petroleum industry. The paper is a part of an on going study to propose/develop a technology transfer model for the Libyan oil industry and identify under-performing segments of the technology transfer process, also to select the best technical and optimum technology for the industry.

1. Introduction
This paper examines the key elements that affect the adoption of the Libyan oil industry to new technologies and cultivate technological capability through technology transfer (TT). TT continues to be a major stimulate to industrialization and economic growth from developed countries to developing oil producing countries. Several researchers have defined the TT term differently due to their individual fields of study. Chacko (1986) described TT in a scientific manner as converting physical/mental matter/energy into directly usable alternate form(s), and transfer means from one pocket into another pocket. Williams and Gibson (1990) define TT as the shared responsibility between the source and the destination by ensuring that the technology is accepted, or at least understood. However, UNCTAD (1979) has defined TT as the transfer of systematic knowledge for the manufacturer of a product, for the application of a process, or for the rendering of a service. The adoption measurement in the oil industry is essential as there has been always a parallel between the adoption of technology and the product adoption.

2. Brief literature review

The adoption of foreign-developed product technology by companies located in developing countries has been studies in terms of behavior and attitude towards new technology or products. It's expected that the adoption of new technology will be rapid easier if the new technology perceived to be compatible and easy to adopt. The employee attitudes towards a behavior influence their intention to perform that behavior. Davis et al. (1989) developed an adoption model based on two antecedents to attitude towards information technology: the perceived usefulness of the system (the degree to which the system would improve performance), and the perceived (the degree to which using the system is expected to be effortless). While both of these antecedents have a direct impact on attitude, perceived usefulness is also hypnotized to affect behavioral intentions directly. In this study, we build and empirically test a model that relates to several antecedents variables to adoption of foreign developed technology by oil companies in Libya. Our model, shown in Figure 1, is based on the

extent literature in TT processes and literature on technology adoption. The TT model is specifically designed to be applied to the study of technology transfer from developed countries to the Libyan oil industry. The TT process has not been tried before, and we seek evidence supporting the relationship identified in our model via exploratory empirical study. We believe in the importance and the uniqueness of the Libyan oil industry TT processes. The exploratory test of our model is conducted in Libyan oil industry, arguably one of the most prominent oil producing countries in the world today. Libya's oil industry is currently undergoing rapid expansion, and technology transfer for oil industry development is likely to be an important engine for economic developments in Libya. We used a convince sample of respondent representing over 30 oil companies across several oil industries in Libya : oil production, oil exploration, oil technology, oil refining, and oil marketing. The specific behavior being modeled is the adoption of foreign developed technology by Libyan oil employees in the industry.

3. Methodology
This paper is confined to investigating only the Libyan oil industry, and then only the National Oil Corporation (NOC) fully owned oil companies and joint ventures companies. A survey was carried out on the sample targeting oil companies' employees who has involved in TT processes. TT processes was defined as some form of knowledge, material or equipments is transferred on oil industry from one foreign party such as a person or organization to another local (Libyan) party as a person or organization that arrange to receive it. Thus, respondents from Libya's oil industry were considered to be the best respondents to evaluate the adoptions and importance of variables pertaining to the TT process and the outcome it can potentially generate. The survey was national, all Libyan oil companies was surveyed. 3.1 Survey Questionnaire A questionnaire was sent to stratified sample of oil industry employees of different companies. Positions range from General Manger, Manager, Project Manager, Superintendent, Project Engineer, Supervisor, Engineer, and Technician. The questionnaire was in six sections TT projects profile, government involvement, TT environment, TT adoption, performance evaluation, and respondent background information, total of 60 questions. Respondents were requested to provide rating for their opinion and the perceived impact on a five-point Likert scale. The survey was conducted from April 08 to September 08.

4. Results
4.1 Characteristics of respondents The respondents were classified into eight positions categories: manager (3.8%); project manager (3.8%); superintendent (3.8%); project engineer (23.1%), supervisor (19.2%); engineer (38.5%); technical (3.8%); and other positions (3.8%). The profile of respondents according to their companies as follows: oil production (42.3%), oil refining (19.2%), oil exploration (26.9%), oil technology (9.0%), and oil marketing (2.5%), of these companies (84.6%) fully owned by NOC and (15.4%) were joint venture with a foreign oil company. Evaluating education levels was necessary to demonstrate that respondents were sufficiently educated to develop a professional opinion about the oil industry. The survey showed that only (7.7%) of the respondent has a PhD, (46.2%) hold a Master degree, (26.9%) has a B.Sc, (15.4) had a diploma and (3.8%) has some other from of education. The respondent's age breakdown was: 30-40 years (31%); 41-50 years (57.5%); and over 50 years (11.5%). Their oil industry experience breakdown was: 0-5 (3.8%); 6-10 (30.8); 11-15(19.2%); 16-20(11.5); and over 20 years (34.6%).
Respondent Position

MANAGER 4% 4% 4% 4% 4% 23% 38% 19% PROJECT MANAGER SUPERINTENDENT PROJECT ENGINEER SUPERVISOR ENGINEER TECHNICAL OTHERS

Figure 1. Respondent's position

Profile of Respondent Companies

9%

3% 42% Oil Production Oil Refining Oil Expolration

27%

Oil Technology Oil Marketing 19%

Figure 2. Profile of respondent's company specialty

Company Type

Joint Venture 15% NOC Owned Joint Venture

NOC Owned 85%

Figure 3. Profile of respondent's company type

Respondents Education

8%

4%

15% Diploma BSc MSc PhD 27% Others

46%

Figure 4. Profile education background

Respondent Age Breakdown

12% 31% 31-40 41-50 51 & above 57%

Figure 5. Respondent's age breakdown

Respondent Oil Working Experince

4% 34% 31% 0-5 6-10 11-15 16-20 12% 20 & above 19%

Figure 6. Profile of respondent's company specialty

TT Modes Profile
Joint Venture Turn Key Management Contracting Others

12%

23%

38% 27%

Figure 11. TT modes profile

As discussed, the questioner survey contained three distinct parts. The first part solicited descriptive statistics on the participating respondents and the past and present processes were TT programs were integrated. This part enabled to establish a comprehensive respondent profile. The corresponding TT profile defined the modes of TT process that has been applied in the Libyan oil industry. Notably, the management contracting has the lion share with (38%) of all TT processes.
4.1 Respondents attitude towards new technology

Many attempts have been made to measure the process of technology adoption and diffusion. The best known for these is the Bas model for forecasting the diffusion of nondurable products, Bass (1969). Based on the review of the literature, a multi item likert scale was identified for each item of respondent's profile and modified to suit the research purpose and particular study context. As in any study of this type conducted in Libya, there is the danger that specific respondents are not familiar with survey research instruments or processes. Therefore several steps were taken to bridge this potential gap. A focus group from the Libyan oil industry was engaged to evaluate the instruments and after editing the instruments, these experts pre-tested the instruments with several knowledgeable employees whom they knew. These experts were subjected to postquestioner inquiry to critique the instruments and suggest further edits to ensure lack of ambiguity and increase clarity of meanings. Finally, the instruments was appropriately

translated to Arabic and revised to ensure that translation meaning was intact. The perceived attitude breakdown by age groups is shown in Figure 7.
Opinion Towards New Technology vs. Respondents Age

51 & above

Strongly Agree Agree Neutral

41-50

Disagree

31-40

0.0%

20.0%

40.0%

60.0%

80.0%

Figure 7. Respondents age groups' opinion towards new technology

As shown in Figure 8. the majority (62%) of respondents have a "Strongly positive" attitude towards news technology imported from advanced countries. In addition, respondents "Strongly agree" with (54%) that the level of complexity will affect the TT process with (12%) "Disagree" that complexity of technology has anything to do with effectiveness of TT process. Responding to a query in the survey about the Libyan employee capability to utilize the available foreign technology. Only (32%) of respondents showed strong agreement, (62%) agreed that Libyan employee has that capability.
Respondents Attitude of New Technology Impact
Negative Neutral Positive Strongly Positive

19%

4%

15%

62%

Figure 8. Respondent's attitude towards new technology impact

Respondents Attitude Towards the Effectiveness of TT According to the Level of Complexity of New Foreign Technology
Disagree Neutral Agree Strongly Agree

15%

12% 19%

54%

Figure 9. Respondent's attitude towards the effectiveness of TT based on level of complexity

The Perception Towards Libyan Oil Employee Capability To Utilize Available Foreign Technology
Disagree Neutral Agree Strongly Agree

23%

8%

8%

61%

Figure 10. Respondent's perception towards learning capability of available new technology

5. Discussion and conclusion The adoption measure in the Libyan oil industry was conceived as sub category of TT model with special emphasis on attitude towards new technology. We believe that suitably modified TT model could be successfully extended and applied to the case of oil industry in developing nations. Industry leaders in developing countries seeking to adopt foreign developed technology to improve their industry production processes to increase their global competitiveness need to weight several factors in adoption of new technology. Whilst, the model provides a clear picture on how to better utilize TT processes to create value for oil producing countries. A limitation of the study, of course, is the empirical test in only one developing nation, Libya. The Libyan emerging oil industry and the Libyan cultural environment may be different enough from developing nations that the generalization of the model maybe questioned. Another limitation is our use of convenience sample. While appropriate for an early, exploratory study, one must regard the results obtained in this study as preliminary. 6. References
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Saad, M., Cicmil, S. and Greenwood, M. (2002), Technology transfer projects in developing countries furthering the project management perspectives, International Journal of Project Management, Vol. 20 No. 8, pp. 617 -25. Wang, P., Tong, T.W. and Koh, C.P. (2004), An integrated model of knowledge transfer from MNC parent to China subsidiary, Journal of World Business, Vol. 39 No. 2, pp. 168 -82.

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