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Keeping deepwater
OCTOBER 2009

economics afloat
Toughing it out
on the bayou
Rig market
OFFSHORE ENGINEER transformers
www.offshore-engineer.com

PLUS: WHY THE MARINE SEISMIC SECTOR SEEMS STRANGELY CLUELESS ABOUT WHAT 2010 HAS IN STORE
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 OCTOBER 2009
COVER
Samsung Shipyard workers in
South Korea secure the derrick for
the first of four ultra-deepwater,
sixth-generation drillships the yard
is building for Pride International,
underscoring the driller’s clear
commitment to the deepwater
market these days (see page 39).
PHOTO: MCNEE PRODUCTIONS

http://interactive.offshore-engineer.com Volume 34 Number 10

OE welcomes letters
reflecting all shades
of offshore industry opinion
but reserves the right
9-14
contents DIGEST Will more mergers follow Baker/BJ?; Gorgon
go-ahead at last; Brazil’s pre-salt shake-up . . .
as Tupi test takes two; Tombua-Landana
onstream; Trinidad tweaks lease terms;
to edit and condense. Venezuelan Pearl; Venus value; Total tees up
Laggan-Tormore; Gabon risk rising.

letters to 16-19 ANALYSIS Jennifer Pallanich samples opinion at the recent

Rice Global E&C forum. Also, Russell McCulley

the editor
Sir, Professor Economides’s article on Brazil
checks out the Gulf of Mexico’s latest, low-key
licensing round and India’s newly reinstated
NELP road shows.
(OE September), and his comparison to the
policies of the new US administration, is 20-22 G&G NOTEBOOK At this stage of the year the marine seismic
right on target. Thanks for publishing! business has given up on 2009 for any
Richard Bresler, VP Projects, Gulfsands Petroleum, game-changing shift in market prospects
Houston, Texas. and is looking ahead to 2010. But this time,
as Andrew McBarnet observes, the sector seems
Sir, Having been involved since 1970 strangely clueless.
in engineering of platforms from which
the magicians pull oil and gas out of the 25-29 FLOAT ON As floating facility design firms continue
ground, I appreciate articles like Professor their quest for economic ways to meet
Economides’ latest in the September operator needs in ultra-deepwater, Jennifer
issue in which he tells it like it is. While Pallanich talks to industry leaders about
his viewpoints might rile fellow faculty the latest solutions, challenges and trends.
members, that he is part of the UofH faculty Also, Houston Offshore Engineering’s
has made me proud that my youngest is a John Chianis and Philip Poll discuss the
graduate of that university. novelties and niceties of the Paired-Column
John Sullivan, Foster Wheeler, Sugar Land, Texas. Semisubmersible.

Sir, In what universe does [Professor 31-33 TELEMARK TITAN ATP Titan, the first MinDOC floating
Economides] exist? In ‘Flying pigs and other platform, is scheduled to leave its Texas
media myths’ (OE July), he used the very graving dock this month destined for the
real issue of media hysteria to contradict deepwater Gulf of Mexico’s Telemark Hub.
assertions of global warming. That the US Russell McCulley gets a look at the
could be the largest consumer of energy near-complete structure and talks tactics
and one of the smallest polluters is a sham with the operator and its design and
assertion and incredible fabrication. I agree construction team.
that all our energy needs cannot be met
simply by wind and solar alone – and no one 34/35 LEASE HOLD? With the speculative FPSO bubble well and
is saying that – but that does not excuse the truly burst, Infield’s Catarina Podevyn and Dr
necessity for the US to clean up its energy use. Roger Knight discuss the relative attractions of
Meredith Potyondy (by email) leasing or owning.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 3

OCTOBER 2009
39-43 PRIDE OF PLACE With its mat-supported jackup spin-off and
four high-dollar ultra-deepwater drillships
under construction, Pride International
is meeting CEO Louis Raspino’s goal of
restructuring the company to step into
the future. Jennifer Pallanich opens OE’s rig
market two-parter with a look at the driller’s
transformation in just four years.

45/46 DEEP POCKETS Ensco spent the better part of 2004

contemplating how best to invest revenues
it anticipated landing on the books between
2006 and 2008. After considering many
options, the board voted to pursue the
deepwater in a meaningful way. Jennifer
Pallanich reports on how the Dallas-based
driller’s plans are starting to pay off.

48-50 GE WHIZZ GE Oil & Gas has now fully integrated the
VetcoGray and Hydril Pressure Control
brands into the group following their
acquisitions in February 2007 and April 2008
respectively. Meg Chesshyre reports.

SUPPLEMENT: OE09 REVIEW September’s SPE Offshore Europe 2009 show

drew record crowds, again demonstrating the
biennial Aberdeen event’s happy knack of
rising above prevailing inauspicious market
conditions. Jennifer Pallanich, Russell McCulley,
John Sheehan and Meg Chesshyre sample the
show’s sights and sounds.

53-59 LOUISIANA LOOKOUT Louisiana has seen its share of boom-and-

bust cycles. Will the 2008/09 crash be just
another temporary dip, or will the state’s role
in the offshore industry emerge diminished
when the recovery comes? Russell McCulley
talks to local industry leaders.

60/61 MEXICO IN FOCUS With the upcoming PECOM show focusing

attention on today’s challenges and
opportunities in Mexico, Russell McCulley
harks back to the country’s fascinating oil
sector genesis with the aid of a traveling
photographic exhibit.

63/64 LASER VISION ‘Smart’ laser vision sensors capable of

reconciling today’s higher pipe welding
speeds with enhanced weld quality
requirements should be on the market early
next year, reports CRC-Evans’ engineering
vice president Shankar Rajagopalan.

66/67 PIPELINES IN DEPTH With pipelines progressing into ever deeper

waters over the years, Corus Tubes’ technical
manager Martin Connelly pinpoints some of the
enabling technological advances in pipeline
manufacture and design.

82 EBB & FLOW By actually using its energy challenge,

China can lead the world and turn a looming
potential catastrophe into an opportunity,
believes Professor Michael J Economides.

REGULAR FEATURES OE contacts (6), Contracts (14), Offshore data

(68), Products in action (71/72), Firms (74),
Faces (75), Diary (76), Display advertisers
index (77), Bookshop (78-80), Classifieds (81).

4 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

OE_M_4_NP_AOS.indd 1 28/9/09 13:53:31

OE_M_4_Jetlube_FP.indd 1 29/9/09 08:16:19
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OE_M_4_NP_DCTZ_HPV.indd 1 29/9/09 07:39:53

OE_M_4_ABV_FP.indd 1 28/9/09 18:32:30
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 DIGEST
‘The BJ sale to Baker definitely ‘To engineer, build and
had something to do with the operate [Gorgon], we have
forecast of natural gas prices.’ brought together the best
Prof Michael J Economides and brightest from Chevron,
our partners and industry.’
Roy Krzywosinski

More mergers or support for the industry’s

woes. About 31% said they
digest
& gas industry to rebound
more quickly than the larger
to the Baker Hughes line
of products and services,
may be on tap believed the worst of the
recession was over, while 53%
economy. But the industry
shouldn’t get too accustomed
said Michael J Economides,
professor of chemical and
Does the recent announcement saw few signs of recovery. to price stability, he said. ‘Why biomolecular engineering
of Baker Hughes’ intention to In any event, the downturn do we think prices are going at the University of Houston
acquire BJ Services signal a has put a damper on to be stable?’ Medlock asked. and co-editor, with Tony
resurgence of energy industry M&A, said Jon McCarter, ‘I think that’s a reasonable Martin, a BJ Services business
merger and acquisitions? transaction advisory services question.’ development manager, of
Experts seem divided on the leader at Ernst & Young’s Lane Sloan, president of Modern fracturing: enhancing
issue, if the panel at a recent Americas Oil & Gas Center. Sloan Consulting Services, natural gas production.
Houston breakfast meeting is ‘October 2008 is really when said the industry will see more ‘The BJ sale to Baker
any indication. The speakers the shoe fell’ and M&A activity volatility over the next couple definitely had something to
at the city’s Petroleum Club plunged, he said. But the of decades but that the trend do with the forecast of natural
were there to discuss the trend may have bottomed out: was toward higher oil prices. gas prices,’ Economides told
results of a recent study McCarter pointed out that There have been few very OE. ‘The future for BJ as a
gauging how industry leaders the longest ‘down cycle’ for large discoveries, he said, and standalone company didn’t
are navigating the current M&A came in the late 1980s the transportation sector in look very good for the next few
downturn, but talk ventured and lasted seven quarters; developing countries, fueled years.’
well beyond those confines the current M&A slump has almost exclusively by oil, will
to include public policy and lasted four quarters, he said, exert increasing pressure on
the state of M&A in today’s indicating that an uptick in the demand side. ‘China really Gorgon gas
market.
The survey, ‘Riding the
activity could be forthcoming.
Price stability, McCarter
is the driver,’ he said.
Stabilization could lead
go-ahead at last
rapids,’ was sponsored by said, is more conducive to to an upsurge in M&A. But Operator Chevron (50%) and
Production Services Network M&A investment than high so could the fact that many its heavyweight joint venture
(PSN) and involved extensive commodity prices. ‘High oil companies that have been partners ExxonMobil and
interviews with 31 executives and gas prices aren’t really waiting for the market to Shell (25% each) sanctioned
in the US, UK and Canada. what drive M&A activity,’ he improve won’t be able to hold Western Australia’s
The Aberdeen School of said. With prices relatively off any longer. giant Gorgon Project last
Business conducted the stable for some time, he That may have been partly month following years of
research. Among the findings said, the industry will likely behind the timing of the painstaking engineering and
was the surprising number of return to the ‘more normal Baker Hughes-BJ Services environmental assessment
respondents – 51% – who said investment activity’ rate of deal, which at the time it work. The final investment
their companies were immune five years ago. was announced was worth decision on the project, the
or only moderately affected by Ken Medlock, a fellow an estimated $5.5 billion: first phase of which has an
the recession. However, 89% in energy studies at Rice with natural gas prices down estimated price tag of
said they had been affected University’s Baker Institute, and likely to stay that way A$43 billion, was announced
by tighter credit, 78% had said he was ‘surprised by for some time, BJ’s pressure on 14 September after the
suffered as a result of oil price the pace of M&A activity’ pumping specialty was granting of production
volatility and 46% blamed a in the current environment vulnerable on its own, but licences and final state
lack of government incentives and that he expected the oil an attractive complement development approval at a

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 9

DIGEST
authorize the government to recoverables at Guará at
transfer pre-salt E&P activities 1.1-2 billion barrels of 30°API
that are not under concession and natural gas.
to Petrobras in return for With this finding, Petrobras
payment for ‘transfer of has prioritized the Guará
rights’. Because Petrobras area to receive a 120,000b/d
expected rapid congressional capacity FPSO up for bid for
approval of the proposal, the the Santos Basin pre-salt area.
operator indicated it would The company, which operates
enter into negotiation with the Guará with 45% on behalf of
government over the terms of BG (30%) and Repsol (25%),
Pictured giving the Gorgon go-ahead in Perth are (left to right): the transfer of rights. expects to begin drilling a new
Colin Barnett, WA state premier; George Kirkland, Chevron Petrobras has said it well in the area later this year.
Global Upstream & Gas EVP; Al Hirshberg, ExxonMobil expects to invest $111.4 billion Partner BG targets production
Development Company VP, and Jon Chadwick, EVP Shell Gas & developing production in the at Guará in 2012.
Power Asia. pre-salt through 2020 with
$98.8 billion earmarked for the
signing ceremony attended brought together the best and Santos Basin and $12.6 billion Tombua-Landana
by Western Australian state
premier Colin Barnett and
brightest from Chevron, our
partners and industry,’ added
for Espírito Santo Basin.
The pre-salt reserves tend
onstream
Australia’s resources & energy Krzywosinski. to be about 30°API oil at 5000m Chevron’s $3.8 billion Tombua-
minister Martin Ferguson. Long-term Gorgon LNG to 7000m below the water line Landana development in
First gas is now planned for sales so far to companies in and in water depths of 1900m Angola block 14 began
2014. China, India, Japan and South to 2400m. Tupi – now in the producing early September,
The Carnarvon Basin Korea are valued at about extended well test phase – is targeting peak production of
gas fields that constitute $125 billion and Chevron the largest pre-salt find so 100,000b/d in 2011. Chevron,
the Greater Gorgon Area says it expects additional far, holding an estimated 5-8 which operates the field with
represent an estimated agreements to be executed in billion boe of recoverables. A 31% interest through Cabinda
resource of 40tcf of natural gas the coming months. host of other large discoveries Gulf Oil for partners Sonangol,
(6.7 billion boe) and are located dot the surrounding area (OE Eni, Total and Galp, estimates
90-160km offshore in water June). recoverable resources for
depths ranging from 220m to Brazil’s pre-salt the two fields at 350 million
1300m. The project’s scope
includes a three-train, 15mtpa
shake-up . . . . . . as Tupi barrels.
The 46-well development,
LNG facility and a domestic
gas plant on Barrow Island,
The next time bidders see
pre-salt acreage on offer
test takes two featuring a 1554ft compliant
piled tower in 1200ft of water,
where construction work is offshore Brazil, not only will Production resumed at is designed for zero discharge
expected to be in full swing the terms be different, but Brazil’s pre-salt Tupi field of produced water and zero
in the first quarter of next only Petrobras will be allowed early September, roughly two routine gas flaring. Associated
year. The project will also take to operate these potentially months after its extended well gas is to be commercialized at
underground carbon dioxide lucrative blocks. Proposed test was halted. the Angola LNG project under
injection technology to a new changes to the PSCs for the Petrobras suspended construction at Soyo.
level, with the JV partners pre-salt area that Brazilian production from the Santos
investing some A$2 billion on president Lula da Silva Basin block BM-S-11 field in
a scheme to inject naturally submitted to Congress also early July after detecting a Trinidad tweaks
occurring, reservoir carbon
dioxide into 2500m deep saline
introduce ‘profit oil’ and ‘cost
oil’.
problem with bolts used in
the Tupi Sul subsea tree in
lease terms
aquifers beneath Barrow The proposed legislation 2140m of water. Tupi had been On the back of a less-than-
Island rather than vent it to defines profit oil as the producing 14,000b/d to the stellar lease sale, the Trinidad
atmosphere (OE April 2006) production of a field, after FPSO Cidade de Sao Vicente & Tobago energy ministry has
Speaking at last month’s deducting costs and expenses as part of a 15-month EWT for redoubled its efforts to woo
signing ceremony in Perth, related to oil production. Cost the consortium of operator operators.
Chevron Australia managing oil corresponds to costs and Petrobras (65%) and partners ‘What we want to do is
director Roy Krzywosinski investments made for E&P BG (25%) and Galp Energia have a regime that’s flexible
(pictured) said Gorgon would activity. The amended regime (10%) to gather technical enough that we don’t have to
be ‘an important pillar of would allow the Brazilian data to help in the appraisal go back to the drawing board
the Australian economy’ for government to either and development of the other that often,’ said Helena Inniss-
the next 40 years. ‘Gorgon exclusively hire Petrobras discoveries in the area. King, director of the resource
is a long term, technically or conduct public bids with One such find is the Guará management division, leader
complex project that will mark any company; when areas accumulation 55km away of a ministry team that arrived
a step-change and dramatic are bid, Petrobras will have a in block BM-S-9 in 2141m of in Houston late August to
advancement of engineering, minimum 30% interest. A new water, where Petrobras last unveil proposed changes to the
developing new frontiers in state-run company intended month announced that the nation’s production sharing
up to 1300m of water, and best to represent the Brazilian test well had confirmed high contract terms. The changes
practices in environmental government’s interests with productivity of the oil-bearing are expected to be in place
management. regard to PSCs is likely to be reservoirs in the area’s pre- ahead of the upcoming 4Q
‘To engineer, build and formed. salt layer. Based on drill stem 2009 leasing round where six
operate this project, we have The legislation would also test data, Petrobras estimated shallow water blocks are on

10 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

OE_M_4_NP_Flot_Tech_FP.indd 1 28/9/09 17:22:54
DIGEST
OLEG OFF THE BLOCKS: Seaway The two fields, in around
Heavy Lifting’s newbuild crane vessel 600m of water, are relatively
Oleg Strashnov was launched on 22 small and far removed from
August at the IHC Krimpen shipyard existing gas infrastructure but
in the Netherlands. Delivery is on lie in the vicinity of several
schedule for the first half of 2010. other medium sized but
The new 183m long monohull vessel, important gas finds, notably
capable of 14 knot transit speeds, Torridon (Chevron), Laxford
will be fitted with Class 3 DP and an (Total) and Tobermory
IHC Gusto crane with a revolving lift (ExxonMobil).
capacity of 5000t (OE September). As well as presenting the
findings of an assessment of
offer in regions with proven discovery, in about 60m of drilling in the area is expected, the environmental impacts
gas or condensate reserves. water in the Gulf of Venezuela, he added. ‘Anadarko plans to resulting from drilling up
Heidi Wong, director of could hold between 7tcf and drill two to five wells in the to eight Laggan-Tormore
commercial evaluation, said 8tcf of gas. trend next year.’ wells, the French major’s
the ministry is looking to The Pearl 1 well in the On completion of activities environmental statement
establish PSCs for different Dardon IV block drilled into at the Venus discovery covers the installation of twin
depths: under 400m, a reservoir that according to well, Anadarko next plans 18in multiphase pipelines, a
400m-1000m, and over 1000m. preliminary estimates could to continue its West Africa hydrate inhibition pipeline,
The new PSC models, Wong be 33km2 and 240m thick. The drilling operations in the and a control umbilical
said, are expected to include Spanish operator says its data Cretaceous Trend by drilling running from the two fields
fixed cost recovery based on is pending final confirmation the South Grand Lahou to a new gas processing
water depth, minimum and of the well testing that was exploration well in block CI plant at Sullom Voe, where
maximum bid profit shares, being carried out at the time of 105 offshore Cote d’Ivoire. the fluids will be separated
reduced windfall triggers, the announcement. into condensate, gas, and
fixed bonuses, and a new Repsol operates the Pearl 1 water. Work is due to begin
valuation system for both well with a 50% stake, in Go for Abadi FLNG in April 2010 and the subsea
oil and gas. Greta Jackman, consortium with Eni. In the In approving an Inpex development has a design life
commissioner of inland development phase, PDVSA development plan for the east of up to 30 years.
revenue for the ministry of would have a 35% stake, with Timor Sea Abadi gas field, The gas component will
finance, noted the taxation Repsol and Eni keeping 32.5% the Indonesian government be exported to the St Fergus
system will also see some each. last month gave the go-ahead gas terminal in northeast
restructuring. to build a floating liquefied Scotland via a newbuild gas
Inniss-King said the energy natural gas (FLNG) plant to pipeline with a connection
ministry plans to begin using Value at Venus tap this 2000 discovery in the to the existing Total FUKA
a defined and publicized point A deepwater well offshore Masela block some 360km gas pipeline close to the
system for evaluating bids, Sierra Leone paid off for north of Darwin. decommissioned MCP-01
adding: ‘We used to do that in Venus operator Anadarko and Construction work begins facilities (covered in an East
private. What we’ve done is its partners, Woodside, Repsol this year on a project operator of Shetland environmental
make that public.’ and Tullow. Inpex Masela envisages statement, for which survey
‘We want to close off the The Belford Dolphin drilled coming onstream in 2016 work is ongoing). The
shallow [round] first then do the discovery well in block and ultimately having an condensate will be stabilised
the deepwater,’ she said. ‘We SL 6/07, marking the first LNG production capacity of and exported by tanker
want to see the response we deepwater test in the Sierra 4.5mtpa. utilising existing BP facilities
get, how the system works,’ Leone-Liberian Basin. Drilled PT Tiara Energy, in at Sullom Voe.
Inniss-King said. This would to about 18,500ft in 5900ft of co-operation with Flex LNG Production is planned
allow the ministry time to water, the Venus B-1 well and Samsung, has offered to to start in 2014 and peak at
tweak the terms if needed encountered over 45ft net of build three FLNG facilities for estimated rates of 12,859m3/day
ahead of Deepwater 2010. hydrocarbon pay, Anadarko the project – each with 1.8mtpa gas and 2655m3/day
The areas in Deepwater 2010 said. processing capacity – at a condensate in 2015. The
either have proven structures ‘With Jubilee on the east combined estimated cost of licensees are: Total (operator
or are in a frontier area. ‘In and Venus on the west, we $4.5 billion. with 50%), Dong (20%), Eni
2010, we are stepping into have established bookends (20%) and Chevron (10%).
unknown territory,’ observed spanning approximately
Hasley Vincent, the energy 1100km across two of the Total tees up
ministry’s senior geologist. most exciting and highly
Laggan-Tormore Recovery: tough,
‘Frontiers are always
exciting. We think we have
prospective basins in the
world,’ said Bob Daniels, Thoughts of a potential gas
but better than ’80s
an extension of an established Anadarko SVP for worldwide fields development cluster in Oil demand, fueled mostly by
petroleum system.’ exploration. Jubilee, offshore the remote West of Shetland emerging markets, will pick
Ghana, ranked as the second region were encouraged last up next year and rebound to
largest oil discovery in 2007, month when Total issued its its 2007 pre-recession high by
Pearl of a find behind Tupi offshore Brazil. environmental statement 2012 – a five-year turnaround
Repsol believes it may have Daniels said the field partners covering the proposed subsea that will be shorter than the
found the largest gas field are evaluating the well’s development of the Laggan- recovery period that followed
in Venezuela. The company initial results and the plan Tormore fields in UKCS blocks the early 1980s oil crisis,
estimates last month’s for the prospect. Additional 206/1 and 205/5. according to a new report

12 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

OE_M_4_NP_Cameron_FP.indd 1 28/9/09 15:03:22
DIGEST

CONTRACT BRIEFS from IHS Cambridge Energy

Research Associates (IHS Cera).
Gabon risk
z Shell Global Solutions Intl and The latest installment of its increases
SBM Offshore signed a framework World oil watch report predicts Gabon, once a stable West
agreement for the supply of turret oil demand growth will African country, has become
mooring systems to Shell’s FLNG resume by 900,000b/d in 2010 a riskier place to operate
facilities. The agreement covers a and return to its 2007 high by in following days of clashes
period of up to 15 years. 2012. Oil demand has fallen between security forces and
z Aker Solutions has an EPC contract 2.8 million b/d during the protestors unhappy with
from Eni Norge worth around current recession, from a high the declaration of Ali Ben
NKr2.3 billion to deliver a subsea of 86.5 million b/d in 2007 to Bongo, son of late president
production system to the operator’s 83.8 million b/d this year. When Omar Bongo, as winner of an
Goliat field development in the Barents oil demand last took such a election earlier this month. Energy. It had been deployed
Sea. Subsea hardware deliveries tumble, in the 1980s, nine Rioting and looting erupted on the Ivanhoe and Rob Roy
include eight overtrawlable four-slot years passed before demand in Gabon, and risk mitigation fields in the UK North Sea
subsea templates with manifolds, crawled back up to the 1979 specialists AKE raised its risk since 1989 with the Renee
24 subsea trees and 20km of steel pre-recession high. rating for Port Gentil from 17, and Rubie fields producing
tube umbilicals. The outlook is better this which indicates instability, to to it since 1999. Weighing
z Acergy landed a $110 million time around, but demand 20, or hostile. in at 17,000t, the unit has
contract from Total and BP for the recovery ‘is still going to According to AKE, French a processing capacity of
Angola block 17/18 GEP phase two take a substantial amount of interests had been targeted 70,000b/d of oil and
project, involving the installation of time,’ said IHS Cera chairman in the unrest because of the 42.5 million ft3/d of gas with
over 70km of 24in pipeline from block Daniel Yergin. former colonial power’s a water injection capability
2 in up to 40m of water. Emerging markets will support of the Bongo regime, of 72,000b/d and treatment of
z SBM Offshore has signed an drive the recovery of oil so Total has evacuated French 75,000b/d.
agreement with Noble Energy to demand, which is expected to citizens and other expatriate Ayman Asfari (pictured),
provide, lease and operate an FPSO rise 5.3 million b/d between staff to Libreville, which had group chief executive of
for the development of the Aseng now and 2014, the report says. remained relatively calm. AKE Petrofac, said: ‘We were
field offshore Equatorial Guinea. The A full 83% of the demand expected opposition protests able to buy the unit for an
15-year contract will start in 2012 with increase, or 4.4 million b/d, to continue to temporarily attractive price and identified
a possible five-year extension and is will come from non-OECD disrupt investment projects, six opportunities, mainly in
worth about $1.2 billion. countries, with demand in although a Bongo victory is the North Sea, where we could
z Technip won an EPCI lump sum China alone projected to grow thought likely to ensure a deploy it. We’re currently
contract from Dong E&P Norge for 1.6 million b/d by 2014. continuation of favourable talking to a number of
the Oselvar field development in 72m Another factor analysts say foreign investment policies. operators who are interested
of water off Norway. The contract will make demand recovery Crime, banditry, piracy, in it and focusing on looking
includes turnkey delivery of a 27km faster this time is the lack of tribal violence and civil for the best opportunity for the
pipe-in-pipe flowline. options to oil where energy unrest tend to be key security facility.’
z Subsea 7 has secured a use is increasing most issues in Africa, AKE’s
$250 million contract with Petrobras rapidly. In the 1980s, said Nadina Bernecker, director
that will keep the Normand Seven IHS Cera global oil managing of risk consultancy, said at
pipelay vessel in Brazilian waters for director Jim Burkhard: ‘the Aberdeen’s SPE Offshore
another four years. largest area of the demand Europe conference last month.
z Mustang will serve as the main decline came from power Kidnapping can also be a
automation contractor for Chevron’s generation, where oil was risk in that region, she said.
global upstream business units. The replaced by readily available ‘Kidnapping is the one that
agreement covers monitoring, process substitutes like coal, gas or makes the news the most all
control, safety and management nuclear. Today, global demand around the world.’
systems at Chevron’s new and existing growth is coming from the
upstream oil & gas facilities. transportation sector in
z Nexans secured a frame agreement emerging markets where there Refurbed AHOO1
with BP E&P for deepwater GoM
umbilical projects, initially for one
are fewer large-scale options
for switching fuels.’
looking for work WINDY WORK: Seajacks has taken
year but with options for extension by Of course, considering Petrofac is talking to a delivery of its second harsh environment
BP to five. all the factors, political number of operators as it liftboat, Seajacks Leviathan. After
z Oceaneering has a Caspian Sea and otherwise, that make looks to find a home for the transportation from Lamprell’s Dubai
region corrosion and inspection prognostication an especially FPF-1 floating production yard, the vessel arrived in Rotterdam early
management services contract from tricky business where oil is unit it is refurbishing at the September to have its thrusters re-installed
BP worth approximately $45 million concerned, the report comes McNulty yard on Tyneside. before starting work for Fluor on the
over three years, with an option to with a disclaimer: ‘While our The company is looking to UK’s Greater Gabbard wind farm project.
extend for two years. base case suggests that 2012 deploy the unit in the North Sister vessel Seajacks Kraken, currently
z Expro has signed an MOU extending will be the year that global Sea and says It has already working for ExxonMobil offshore Canada,
for two years a pair of contracts with oil demand recovers to 2007 seen interest from a number of has been signed by TAQA for a 60-day
Shell in Europe. The agreement, worth levels,’ Burkhard said, ‘we players. well stimulation contract starting mid-
an estimated $100 million, covers continue to research the The floater, previously November in the Dutch North Sea. It too
the provision of wireline and well test alternative scenarios that known as the AH001, was has extensive wind farm work lined up in
services. could alter the balance in the bought earlier this year from Europe next year. Seajacks is also mulling
oil market.’ Amerada Hess and Endeavour a third vessel and is seeking prices.

14 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 ™ LViZgegdd[ ™ 7^\
™ Hda^Y\g^e ™ EdlZg[ja
™ AVg\Z`cdeh ™ Gj\\ZY^oZY

OE_M_4_NP_Thranes_FP.indd 1 28/9/09 17:59:17

ANALYSIS
‘These are challenging times. ‘Keeping people motivated is
The uncertainty is when it’s key – these soft issues can really
going to stop.’ derail a project.’
Steve Knowles, Mustang Luc Messier, ConocoPhillips

Risky business
analysis know those fairly well. What
happens is a communication
breakdown.’ Conducting a
captured attention. ‘About two
months ago I heard the dreaded
words “gas bubble”, Knowles
review of each completed said. ‘The last gas bubble we
With global economic uncertainty persisting, it is vital for project, he said, is vital in went through lasted about six
companies to take the time to set up the right engineering learning how to improve years, so I really didn’t want to
projects in the future. ‘It’s not hear that.’
and construction contract strategies for large projects, be they so bad to make mistakes. It’s Michael J Economides,
upstream or downstream. That was the message attendees unforgivable to keep repeating professor of chemical and
took away from the annual Rice Global E&C forum, held in them over and over and over biomolecular engineering
again,’ Adkins said. at University of Houston,
Houston last month. Jennifer Pallanich was there. co-author of The color of oil and
audi Aramco, which is Luc Messier, former Technip Tense moments OE contributing editor, offered

S in the midst of a series of

major refinery, gas plant,
and petrochemical expansion
boss and now senior VP for
project development and
procurement at ConocoPhillips,
Thomas Griffiths, executive VP
risk management & business
development at Black & Veatch,
the caveat that ‘alarmism in my
business pays’ before saying he
thinks gas will remain under
projects, has historically said his company is also focused noted it makes sense to plan $4/mcf.
preferred lump-sum turnkey on developing sound contract large projects in three tenses ‘There is a lot of gas in the
contracts on its projects, but strategies. ‘It is essential to find – the past, present and future. market. The suffering may last
that makes the deal risky to the the right contracting strategy By focusing on these tenses, he three to four years,’ he said.
contractors, said Robert Finley, at the beginning. There is no said, it’s easier to identify needs Oil looks a bit rosier.
director of engineering for one-size fits all’ contract. ‘We and potential pitfalls. Economides expects it to
Aramco Services Company. pay the bills. So no matter what Emissions were also very hit $100/bbl by year end.
‘Mega projects are just too happens, good or bad, we pay much on speakers’ minds. Continuing demand and
big to belong to the old school for it.’ Steve Knowles, president access are part of that picture,
of “pass the risk”,’ Finley Getting bad news early of Mustang Engineering, he said, highlighting the
said. ‘We found in general that means problems can be fixed, said the uncertainty about oil status of a few countries
transferring risk comes right added Messier. He said it pays whether there will be cap that are making an impact
back at you.’ So Aramco turned to avoid the ‘project spiral of and trade or a carbon tax on on the global market. ‘Opec,
to a solution that involves death’, often characterized emissions is making it difficult besides Saudi Arabia, has no
converting the contract to a by people focusing ‘more for companies to plan new excess capacity’; Venezuela
lump-sum turnkey format on fighting than fixing the projects. It’s ‘getting to a point is ‘a basket case’; in Iraq
only after the companies problems.’ Keeping people where a bad decision may it’s ‘difficult to produce
involved have reached motivated is also necessary, he be better than no decision oil if people are shooting
agreement on an open book added. ‘These soft issues can because we’re just in gridlock,’ at you’; China has ‘gone
estimate and contingencies. really derail a project.’ he said, describing the state berserk’ with demand, and
Creative contracts and ‘a Dave Adkins, senior partner of the times as challenging, Russia’s ‘resovietization and
greater willingness to take and director of technology rather than uncertain. ‘These corruption’ pose problems too,
risks’ are the way forward, he for Business Management are challenging times. The Economides declared.
suggested. Finley added the Consultants, echoed these uncertainty is when it’s going to ‘Russia under Putin is
company is doing more early sentiments. ‘It’s not the stop,’ he said. clearly the worst story in
constructability studies. tools and technologies. We Beyond that, oil and gas prices energy,’ he went on. OE

16 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

OE_M_4_NP_MTU_FP.indd 1 28/9/09 17:40:22
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 ANALYSIS
On the road again
The market may be down, but the sale of drilling rights goes on.
Russell McCulley checks out the Gulf of Mexico’s latest, low-
key licensing round and India’s newly reinstated NELP road shows.
P emerged the high bidder Exploration, Anadarko, Castex growing economy in 2010 but had contracted with RIL to

B in the most recent Gulf

of Mexico leasing round
with the highest bid on a single
Offshore, Contango Operators
and Shell affiliate SWEPI LP,
which collectively submitted
currently imports roughly two-
thirds of its energy.
At the Houston event,
‘panic,’ according to business
information firm Datamonitor.
The Indian government
tract – $28.1 million for Keathley $14.2 million in high bids. BP India country head Shashi intervened, claiming sovereign
Canyon block 96, in the Lower A total of 3435 blocks – over Mukundan said the company rights to the natural gas and
Tertiary play where the 18 million acres – were on expects an ‘unprecedented declaring the MOU null and
company recently announced offer. Despite the overall poor scale of E&P activities’ over void.
a major discovery at its Tiber showing, the lease sale reflected the next decade as India moves ‘Although the Indian E&P
prospect – and the largest continued interest in the closer to becoming a ‘gas- industry holds great potential
amount bid, with $50.6 million deepwater Gulf; all but 42 of based economy’. The nation, for all stakeholders, the lack
offered on a total of 37 tracts. the blocks receiving bids are in Mukundan said, could require of transparent or consistent
Appropriately, perhaps, given water depths greater than 800m. as much as $250-$300 billion regulatory guidelines has
the shaky state of the industry, in investment to meet its left investors skeptical,’
Western Gulf of Mexico Sale Indian accord goals, and is in need of capital, Datamonitor added. ‘The
210 was the weakest in a decade The MMS struck a non- technology and experienced government has been forced
and generated considerably less binding agreement with operators. to intervene in the latest
interest than last year’s round. India’s Ministry of Petroleum But in spite of significant conflict caused by these market
In all, the August sale brought & Natural Gas Directorate reforms, Mukundan limitations, which could have
in $115.5 million in high bids, General of Hydrocarbons (DGH) acknowledged that India far reaching consequences for
with $145.2 million exposed, to facilitate ‘the exchange of represents ‘a different risk the activities of domestic and
the Minerals Management resource development and profile’ for investors. ‘It’s not international E&P players.’
Service (MMS) reported. The management information for the faint-hearted.’ Mukundan said reforms over
agency received 189 bids on 162 to address issues of mutual An example surfaced recently the past several years have been
tracts from 27 companies. Last interest related to offshore oil, in a natural gas supply dispute ‘mixed,’ but that the country
year’s Western Gulf of Mexico gas, and mineral resources’. between Reliance Industries was moving in the right
Sale 207, by contrast, garnered The agency said the two (RIL) and Reliance Natural direction. ‘What’s important
$487.3 million from 53 companies countries would ‘share best Resources (RNRL). An MOU is that you look at the trend,’
bidding on 319 tracts. practices in leasing activities, signed by the two companies he said, as the government
Two other Keathley Canyon resource evaluation, and said RIL would supply RNRL attempts to bring more
blocks received the second and methane hydrate research with 28 million m3/d of gas for transparency and cooperation
third highest bids in the sale. and development’ while 17 years at a rate of $2.34 per to the process.
Petrobras America bid participating in joint research. million BTU (RIL had an India recognizes the ‘growing
$9.1 million on block 223, The signing of this agreement with National supply-demand mismatch’ and
followed by a BP bid of memorandum of understanding Thermal Power Corporation, is planning major investments
$5.1 million on block 180. in Houston coincided with a or NTPC, to supply gas at the in energy production,
After BP, ConocoPhillips had road show promoting India’s same rate, although other Bidisha Ganguly, head of
the second-highest financial New Exploration Licensing RIL customers have recently the Confederation of Indian
exposure in the sale, with Policy (NELP) VIII licensing been paying the government- Industry’s economic research
$15.2 million bid on 22 blocks, round. DGH reinstated the regulated price of $4.20 per group, said in Houston. ‘A lot
followed by Petrobras, which road shows after announcing million BTU for gas from KG). of area is unexplored, and the
bid $10 million on four tracts. earlier this year that they had As energy and production opportunities are huge,’ she
Chevron bid $9.1 million on been postponed extended the costs increased, however, RIL added.
26 tracts and ExxonMobil deadline for bids extended from backed away from the terms of Seventy blocks, including 24
rounded out the top five with 10 August to 12 October 2009. the agreements and scaled back in deepwater, are up for bids in
$8.6 million bid on 17 blocks. Officials hope to boost production, tying up projects in NELP VIII, the eighth licensing
Other companies among the production in India, which various stages of development round since the program was
top ten bidders included Focus is projected to be the fastest and forcing companies that introduced in 1999. OE

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 19

G&G NOTEBOOK
‘Given such volatility, it is not surprising that seismic services companies
have to be tentative in their planning, and philosophical about the short
term, quarterly result strategic thinking of many oil companies.’

by Andrew McBarnet
[email protected]

by oil companies. An excellent PGS

Seismic sailing into graphic (see below) shows just how exact
the correlation is between oil price and
seismic activity. This is not a desirable

uncharted waters business model when, as now, the oil

companies themselves don’t have much
more than a crystal ball to guide them.
Revival of demand for oil and gas seems
At this stage of the year the marine seismic business has given up on 2009 for
to depend on global economic factors
any game-changing shift in market prospects and is looking ahead to 2010. which are very hard to read. No one
Andrew McBarnet finds it hard to remember a time when there has been so really knows whether the first shoots of
economic recovery spoken about at the
much uncertainty about what may lie in store for the coming year.
recent G20 Summit and elsewhere will be
n normal circumstances the last Equanimity seems to stem from a sustained.

I few weeks of the year are when oil

company customers for marine seismic
services consider their exploration
feeling that the market has probably
bottomed out and that as a result 2010
won’t be as painful as 2009. There is also
In a sense little of the current macro-
economic debate should be relevant
to E&P decision making. Long term
programmes and budgets. But the word is some satisfaction that in general the investments in oil and gas projects from
that oil companies are completely at sixes big players have managed to maintain the exploration phase to production can
and sevens about their future expenditure discipline during the downturn, cutting take up to 10 years to realize, especially
strategy. As a result there have been back on vessels and not reducing prices now that so-called easy oil is no longer
freakily few firm commitments on the to ruinous levels. Some excess capacity available. No one seriously argues that in
seismic survey front – plenty of talk about still needs to be squeezed out of the 10 years’ time demand for hydrocarbon
what would be nice but little evidence system, but assuming a reasonable level products will have somehow collapsed
of money on the table to back it up. This of activity, drastic measures to stay afloat and that oil prices will be in terminal
kind of uncertainty is of course anathema are not anticipated. decline. Precisely the opposite, you don’t
to any industry, but there is no sign yet of The basic problem of course is that have to be a Peak Oil advocate to venture
any panic among the key contractors who demand for marine seismic is overly the opinion that oil prices in another
dominate the market. dependent on oil price trends as perceived decade will have skyrocketed, as a result
of scarcity and surging demand, making
any project started now very profitable
indeed, thank you very much. The
International Energy Agency believes
that by 2030 there will be a need to find
reserves equivalent to six times the
current capacity of Saudi Arabia. That’s a
tall order which, among other things, will
need a lot of seismic to achieve.
IHS Cambridge Energy Research
Associates (IHS Cera) recently attempted
to take the guesswork out of future oil
price demand saying it is set to grow
next year for the first time since 2007 and
return to pre-recession levels by 2012.
According to its quarterly World Oil
Watch report, the rebound would mark
a turnaround from the largest drop in
global oil demand since the oil crisis of
the early 1980s. The report suggests that
oil demand will increase by 900,000b/d
in 2010 and return to its 2007 high of
86.5 million b/d by 2012, a five year
turnaround (see ‘Digest’).
The last time the world experienced
There is a high correlation between seismic activity and oil price. GRAPHIC COURTESY PGS such a severe decline in oil consumption
Note: Active Tenders and All Sales Leads based on PGS internal estimates. Active Tenders and All Sales Leads on 3D contract seismic only. was in the early 1980s. Then it took nine

20 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 G&G NOTEBOOK
Choppy waters for
CGGVeritas vessel
Alizé, set to carry out
major Pemex survey
programme.

years for demand to return to the 1979 of globally connected traders and in 2008 to 88% of production, the first
pre-recession high. The key differences speculators, demand for oil is not always year since 2004 in which production was
between the current recovery and that of the determinant of price. A number not replaced. Total worldwide oil and gas
the 1980s are said to be the demand from of analysts argue that the increase of reserves were 0.4% lower at year end 2008
emerging markets and fewer options crude oil from the mid-$40s to $70 plus as a 3% increase in gas reserves was more
for substituting fuels on a global scale. since earlier this year is attributable to than offset by a 4.4 billion barrel decline
Global demand growth is coming from weakness of the dollar and improving in oil reserves.
the transportation sector in emerging market conditions in the financial sector, The review found that higher prices
markets where there are fewer large-scale rather than supply and demand factors. drove revenues 31% higher to $1,232 trillion,
options for switching fuels, according to yet net income gained by only 24%, held
IHS Cera. Hesitation rationalized back by rapidly rising depreciation
It expects oil demand to increase from Another IHS-related report provides charges. Depletion, depreciation and
83.8 million b/d in 2009 to 89.1 million b/d a more grounded insight into how oil amortization (DD&A) were driven higher
in 2014. Some 83% (4.4 million b/d) will companies rationalize their hesitation by escalating finding and development
come from non-OECD countries. China in current market conditions. The costs, which rose 66% to $25.50 per barrel
alone is expected to account for worldwide upstream investment of 232 oil of oil equivalent. Standard Chartered
1.6 million b/d of cumulative growth. Just and gas companies did increase 21% to managing director Rodney Schmidt
900,000b/d of growth is expected to come $492 billion in 2008, according to the 2009 summed up what this all means. ‘With
from OECD countries. Global Upstream Performance Review, very strong commodity prices in 2008, the
While the trajectory of oil demand released by oil and gas research firm IHS industry generated record cash flow of
seems certain, IHS Cera global oil Herold and upstream corporate advisor $590 billion from oil and gas operations.
managing director Jim Burkhard Harrison Lovegrove & Co, a Standard This was up 36% from 2007 and exceeded
felt obliged to warn that ‘as always, Chartered group company. But, despite capital spending by roughly $100 billion.
future events large and small could record development spending, up 23% However, with upstream revenue and
alter the course of demand’. He might from 2007, worldwide oil and gas finding cash flow for 2009 already well off of last
have added that, in our modern world and development replacement rates fell year’s levels, many in the industry face

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 21

G&G NOTEBOOK
‘Our company has come of age.’ NKr1200 million with over 200 Norwegian
and international investors.
Rolf Ronningen, Polarcus A further encouraging development
for Polarcus was the announcement
of a three month charter beginning in
December by TGS-Nopec Geophysical for
the Polarcus Nadia, the company’s first
12 streamer 3D seismic vessel. The letter
of intent included a right of first refusal
for TGS to extend the charter in two
six-month increments under pre-agreed
commercial terms. According to Rolf
some serious challenges for investments long-standing operational experience in Ronningen, Polarcus CEO, the contract
and strategies going forward.’ Mexico to count in its favour. was confirmation that ‘our company has
Given such volatility, it is not Whatever the merits of the CGGVeritas come of age’.
surprising that seismic services winning tender, the losers obviously felt
companies have to be tentative in their that this was a breach of the disciplined No safe predictions
planning, and philosophical about the approach which has characterized the There are no safe predictions about 2010
short term, quarterly result strategic main contractors’ response to the decline beyond the fact that the current signs
thinking of many oil companies. If there in demand for marine seismic surveys. of world economic recovery are almost
is an exception it is some of the national When bidding for projects, companies universally regarded as fragile. Most
oil companies around the world who are said to have cut their prices from business for marine seismic services can
can plan long term goals free of the the 40-50% margins they were making in be expected to come primarily from the
immediate expectations of stockholders. the good times, but up to now were still major integrated oil companies, larger
The outstanding current example would aiming at profitability, ie no one has been independents and, as already discussed,
be Brazil where the government and state conspicuously buying contracts simply to national oil companies. Smaller oil
oil company Petrobras have been creating keep vessels in the water. exploration companies are likely to be
a new blueprint to exploit its pre-salt, In fact CGGVeritas is in the process still hampered by cashflow issues and
deepwater wealth of hydrocarbons. For of withdrawing seven vessels from the limited access to credit. One implication
seismic contractors there is the confident market in a bid to help match capacity of seismic demand led by the larger oil
expectation of a steady flow of projects. with demand. WesternGeco and PGS organizations may be that the more
Pemex has begun to take the same have made similar moves. In the case of costly, advanced survey techniques
longer term approach and inadvertently PGS, it has become embroiled in a rather such as wide azimuth and high density
touched on the skin-deep vulnerability messy dispute with shipyards in Spain 3D will continue to be on the agenda.
of the seismic market. Early last month over the failure to deliver two vessels on This will benefit those companies which
the Mexican state oil company awarded time, which prompted PGS to cancel both have invested in high capacity, efficient
CGGVeritas a contract to acquire and orders. An arbitration process is ongoing, acquisition technology.
process 75,000km2 of 3D seismic data but PGS is budgeting for substantial By the same token the market for
offshore Gulf of Mexico. The $465 million compensation. 4D seismic should remain relatively
project is said to be one of the largest Other companies have been slimming stable. One reason is that 4D is a field
surveys ever awarded, starting this down their fleets, and somewhat development technology involving
month and extending through 2013. The predictably Scan Geophysical has had a producing reservoir. It is not a
day rate contract includes 3D and wide- to file for bankruptcy. At the peak of the speculative exercise in the same way as
azimuth offshore acquisition, onboard boom Scan, a small time Norwegian- exploration, and no company has publicly
and onshore imaging as well as gravity listed marine seismic company, won complained that 4D did not work for
and magnetic acquisition and processing. investment backing for three new seismic them. To date 4D seismic has a roster
vessels to be built in India. Unresolved of established users, notably BP, Shell
Keeping disciplined construction delays and waning financial and Statoil in the North Sea, who have
There has been some muttering that support in the face of a changed economic been prepared to commit the required
CGGVeritas seriously underbid the outlook proved the death knell for the resources to establish a base seismic
competition from Petroleum Geo- company’s operations. survey and then follow up with surveys
Services (PGS) and Fugro, while the The general feeling is that in 2010 there over time to monitor the reservoir
other potential contender WesternGeco will be around 20% excess capacity, performance.
managed to get itself disqualified from the which could spell further downward Judging from the take-up in 2008/09, the
tender. The disgruntlement sounds very pressure on prices and may be trouble market for other specialised technologies
similar to the outcry when CGGVeritas for some more smaller operators. A lot like ocean bottom survey and the
successfully tendered for a multi-year of speculation surrounds the ability non-seismic marine controlled source
contract a year or two ago awarded by of new company Polarcus, based in electromagnetic survey looks destined
India’s national oil company ONGC. Dubai, to establish itself in the market to be challenging with insufficient
CGGVeritas can probably argue that as it launches over the next year or companies persuaded of the benefits.
it was able to come in cheapest for the so four high-end 12 streamer capacity A final thought is that if the seismic
Pemex job by offering a former flagship seismic vessels and two multi-purpose market defies hopes and expectations for
vessel, the Alizé. This is still a high-end 3D/2D/source vessels. A test of market 2010 and continues to weaken, then we
vessel, equipped with 12 top-of-the-line confidence came late September from could see some merger and acquisition
Sercel Sentinel solid streamers, but one the company’s first public offering on activity. The vulnerable companies know
with a better cost structure than the more the Oslo Axess market. This was over- who they are, and the bigger players have
recently launched vessels tendered by subscribed, giving the company an all hinted that they are positioned to
PGS and Fugro. The company also had implied market capitalisation of pounce. OE

22 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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 FLOATERS
‘It’s the combination of the wind and wave that
gives rise to one of the key areas of concern
these days.’
John Chianis, Houston Offshore Engineering

platform lets [operators] maintain their

Wind tunnel model testing wells so much better.’
of Houston Offshore To that end, RPSEA manages a
Engineering’s Paired-Column consortium of over 145 organizations and
Semisubmersible. universities participating in a $50 million
per year, decade-long program funded by
the US Department of Energy aimed at
increasing the amount of the country’s
reserves that are produced. Of that
money, RPSEA earmarked $1 million to
promote the development of a deep draft
dry tree semisubmersible solution as an
alternative to the spar, which supports
a dry tree but is uneconomic beyond a
certain water depth, depending on the
metocean conditions of the region.
‘The advantages of a dry tree are
obvious. What the operators want is a
way to gain those advantages in the ultra-
deepwater economically,’ explains HOE’s
manager of projects, Philip Poll. ‘If we
can give them a semi that can handle dry
trees, then they would just love it.’
The research program, Ming says, is
part of an integrated approach. RPSEA
is involved in a host of other research
efforts, all intended to make hydrocarbon

Keeping deepwater discovery and recovery more efficient

and less costly.
Eight operators participated in

economics afloat
RPSEA’s Ultra Deepwater (UDW)
Program by providing design criteria
and evaluation of the three competing
As the main visible component of a producing deepwater field – and a costly one – concepts. The three structural designs
were selected from FloaTEC and Houston
the floating facility may eventually give way to a wholly subsea production solution. Offshore Engineering. ‘All three designs,
Until the industry is ready for that, though, floating facility design firms are looking once matured, met the performance
at economic ways to meet operator needs in ultra-deepwater. Jennifer Pallanich requirements that were specified,’ Ming
says. ‘The primary difference between
discusses solutions, challenges and trends with some industry leaders. the concepts came down to offshore
utting all production elements Mexico, where there’s plenty of distance construction. While the FloaTEC E-Semi

P subsea appeals for a variety of

reasons, but two primary goals are
to protect the environment and eliminate
stretching out between ultra-deepwater
finds, that means a tieback will not work
for all finds. ‘If you can’t put a floating
and Truss Semi solutions were feasible,
practical and had some advantages
over the HOE design,’ Ming says, the
both the topsides equipment and facility on it, then you’ve got to put in a operator’s committee selected HOE’s
associated personnel. long tie-back,’ Ming says. The industry Paired-Column Dry Tree Semi (see panel,
‘Of course, the long-term vision is to put is, and will continue to, push tieback page 28), which leaves the quayside
everything on the seafloor, but we’re not limits, Ming notes. Simultaneously, he complete, to move into the next design
there yet,’ says Michael Ming, president says, the industry has focused on making stage and model testing.
of Research Partnership to Secure Energy deepwater production facilities more HOE is expected to complete front
for America (RPSEA). ‘The long-term goal economic. One element of that is a dry- end engineering this fall, and the
is surface host elimination.’ tree solution for ultra-deepwater. solution should be project-ready when
For now, the leading edge of the ‘Direct vertical access is a real key that’s complete. Poll says experts – the
industry is working to produce issue,’ says John Chianis, president of operators who need floating dry tree units
discoveries in water depths of a mile Houston Offshore Engineering (HOE). in the ultra-deepwater – specified the
and a half and deeper. And in the Gulf of ‘Having that captive drill rig on the problem they needed solved, and through

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 25

FLOATERS
‘Production is undergoing the ‘We’ve got some good bites, but nobody’s
willing to pull the trigger.’
same history as drilling. As drilling One solution that many talk about
goes into deeper water, production – but don’t often take up, Poll says – is
early production systems (EPS). ‘Early
goes into deeper water, and you production is a great idea, but I think
need step changes.’ the execution, the right implementation,
has not come along to make everybody
Harris Knecht, Exmar Offshore happy,’ Poll says, adding, ‘at least not in
the Gulf of Mexico.’ Poll suggests one of
the hold-backs operators experience is
that EPS must be economically justified.
the RPSEA program HOE was able to now more emphasis on testing, especially There’s also, he notes, the need to process
devise a solution. ‘If you have the dry tree for the verification of air gap. different types of hydrocarbons from
solution, you’re going to get more oil,’ he While the HOE design is the only different types of reservoirs.
says, because of the ease of interventions one that moved forward in the RPSEA
on a dry tree. As part of the final work program, other engineering firms have Deeper water
on the Paired Column Semi design, a been progressing their own solutions ‘We’re going into deeper water,’ Poll
wind test began in September and a wave without the benefit of the RPSEA funding. says. ‘More importantly, we’re going into
test is scheduled for January 2010. Once Exmar is moving forward with its deepwater regions where the industry is
those are complete, Poll says, it’s simply a on-spec OPTI-EX (OE April). The firm’s less mature.’
matter of convincing the industry that it’s deep-draft floating production semi has In deepwater regions outside the Gulf
ready for prime time. ‘To us, a huge part gone through final commissioning and is of Mexico, that means less pipeline
of commercialization is the testing,’ Poll in Ingleside, Texas, awaiting a contract. infrastructure. By default, the production
says. Samsung built the hull in Korea and solution often becomes an FPSO. ‘We
With memories of hurricanes Katrina Kiewit built the deck in Ingleside. The just haven’t been in deepwater that long
and Rita still looming large, a dry tree mating was performed at Kiewit in May. as an industry, but there are FPSOs
semi with motions equivalent to a spar The OPTI-EX has come in on-budget and worldwide,’ Chianis points out. ‘But we
is a must. ‘Hurricanes in the Gulf of on-time, says Harris Knecht, president don’t have any yet in the Gulf of Mexico,
Mexico the past few years have really of Exmar Offshore. ‘We had the luxury and that’s because of the potential for
shown to be a very critical issue,’ Chianis of the management allowing us good hurricane conditions.’
says. ‘In the 2004/05 season, we saw a engineering time,’ he adds. The US Gulf of Mexico’s first FPSO, the
few hurricanes that exceeded the design While not an ultra-deepwater dry tree disconnectable FPSO Pioneer, is slated
criteria that we were using.’ As a result of solution, FloaTEC began promoting its to begin producing Petrobras’ deepwater
these fierce storms, the industry modified Blue Ocean project last year. The Blue Cascade and Chinook fields in Walker
its wind and wave criteria. ‘That has had Ocean is a spec-designed TLP intended Ridge block 205 in 8200ft of water in mid-
a significant effect on our new designs,’ to shave off up to 18 months from design. 2010. ‘Every day we’re asked to go into
Chianis says. ‘It’s the combination of ‘We could go into construction mode in deeper and deeper water,’ Chianis says.
wind and wave that gives rise to one about six months,’ says Chris Barton, ‘Risk seems to be multiplied many times
of the key areas of concern these days, FloaTEC director of business acquisition. when you’re in deepwater.’ When it
which we call air gap,’ he says. The That will be important, he says, as comes to deepwater facilities, he says, the
wind and waves create ‘a whole series of operators look for a shortened cycle time. industry is still learning.
increased forces on the platform that [the With Blue Ocean, he notes, ‘You’ve got an Knecht agrees, adding: ‘We don’t
industry] had not expected,’ Chianis says. 80% solution in three years versus a 100% always need a lot of science [above
Model testing had become routine, he solution in five years.’ The solution is ground]. We don’t always need a lot of
notes, but with the new criteria, there’s more aimed at the independents, he says. technology. We know we can do what we
have to do. [We can] drill and produce in
deepwater if we want to. It’s a matter of
making the economics work.’
Part of it, Knecht says, will come from
improving what the industry already
has. He traces the history of drilling from
jackups to moored rigs to floating drilling
with dynamic positioning. ‘Production is
undergoing the same history as drilling,’
Knecht says. ‘As drilling goes into deeper
water, production goes into deeper water,
and you need step changes.’
The need for an economically sound
project is more apparent than ever with
the spate of smaller fields the industry
has found but has yet to produce.
‘If the industry is to be successful in
deepwater, we’ve got to come up with a
way to exploit smaller reserves,’ Barton
says. He cites the example of the
Exmar’s OPTI-Ex. 150 million barrel fields that are not being
produced. ‘What [operators] tell me is

26 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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FLOATERS
‘We’re just trying to reduce the cost of this
thing to make the field economic. They’re Paired columns
going to have to come up with innovative
ways to reduce the size of these platforms.’
add stability
The hull of a traditional production
Chris Barton, FloaTEC semisubmersible (many of which exist today)
utilizes four vertical columns arranged in a
square pattern. Four horizontal pontoons connect
the lower portions of the columns. Using the
traditional production semisubmersible as
they can’t develop them because it’s too part of it,’ Barton says. ‘We’re looking a starting point, work by Houston Offshore
expensive.’ The solution Barton envisions at installability. We’re looking at Engineering revealed that the addition of one
is fit-for-purpose. ‘That could be smaller constructability. We’re looking at design.
additional column per corner, in what amounts
spars, smaller TLPs.’ All three.’
Barton notes Petrobras recently called One worry Barton voices is about
to a column pair, would yield significant benefits
for a new round of bids on its Papa Terra the continued delay or postponement in the reduction of platform motions. Due to the
project offshore Brazil after the initial of projects. ‘Gulf of Mexico yards are improved motions, functionality of the platform
bids came in well over budget. After empty. Installation equipment is idle, and is expanded to be compatible with dry trees and
refining the project specs from a full engineering companies are struggling,’ he top-tensioned risers, even for the most severe
drilling TLP tied to an FPSO similar to says, noting that development spending design wind and wave environments in the
the Kizomba approach offshore Angola, a had been fairly high for the last five to
central Gulf of Mexico. HOE’s John Chianis
new request for proposals asked for bids seven years. ‘Oil companies have created
on a smaller facility that relied on tender what I call a portfolio gap’ because now
and Philip Poll take up the story.
assist drilling, similar to the Okume field they are focused more on exploration and he paired-column geometry of this new
offshore Equatorial Guinea (OE October
2006).
‘We’re just trying to reduce the cost of
appraisal spending, rather than a more
balanced approach, Barton says. ‘It’s
created this gap. There’s a lot of spare
T hull form allows for optimization of
hydrodynamic force cancellation and an
associated minimization of platform motions.
this thing to make the field economic,’ capacity in the industry right now.’ Surge, heave and pitch motion RAOs of the
Barton says. ‘They’re going to have Knecht says some of the reason for the Paired-Column Semisubmersible, with and
to come up with innovative ways to slowdown on orders – ‘the shipbuilding without top-tensioned risers, are compared to
reduce the size of these platforms.’ Some industry got overheated,’ he adds – is tied a traditional Gulf of Mexico semisubmersible
solutions may lie in the form of tender to cost. ‘The trend has to go back to be in the accompanying plots. All are
assist, leasing rather than purchasing, consistent with the oil price,’ he says. superimposed over a typical Gulf of Mexico
and refraining from overdesigning A trend Knecht says has caught his 100-year hurricane wave spectrum.
facilities, he says. No matter how many eye is floating liquefaction for LNG. Surge motion is very important for steel
dollars facilities engineers can trim from ‘The foray into floating liquefaction is catenary riser support. For extreme event
their budgets, drilling and completion the logical next step for us to work on,’ waves with periods in the range of
still take up the lion’s share of any field he says. Exmar is working on a solution 14-17 seconds, surge motions of the Paired-
development budget, he adds. ‘The facility with Excelerate and is participating in Column Semisubmersible are approximately
cost is a very small percentage of the total pre-conceptual and pre-FEEDs for various 35% lower than a traditional Gulf of Mexico
development cost.’ applications, he says. ‘Where we jump off semisubmersible. In operating sea states
Barton says FloaTEC is currently depends on finding a gas molecule owner with periods in the range of 6-10 seconds, the
focused on optimizing hull forms, such who wants to pursue this.’ reduction in surge motions is approximately
as angling columns on semis to improve While it has some similarities to 50%. Respectively, steel catenary riser
hydrodynamics and reducing size and floating oil, the cryogenic environment strength design and fatigue life are greatly
complexity. Another effort, he says, complicates the picture. ‘Putting a enhanced.
is to make designs more construction cryogenic hose in the water hasn’t been The Paired-Column Semisubmersible
friendly. ‘Constructability is a big solved yet,’ Knecht says. The industry, also shows very desirable heave motions,
he adds, hasn’t figured out how to handle which are important for top-tension risers
the low temperatures in the water while and dry trees. The heave natural period is
floating at the same time. ‘Everybody shifted more than 4 seconds longer thereby
wants to make LNG look like oil, so that’s avoiding dominant wave energy associated
the holy grail, so any tanker can come up with an extreme event. In the extreme event
and offload it.’ region, heave is reduced approximately by
Knecht figures it’s a goal achievable in two-thirds and half for no top-tensioned risers
about two decades – unless the industry and all top-tensioned risers respectively. For
decides to turn its investment dollars the all top-tensioned riser case, riser stroke is
toward finding a solution. Until then, he reduced to less than 25ft making off-the-shelf
says, offloading will have to be side-by-side. riser tensioner technology available.
The topsides for floating liquefaction are The paired-column cancellation effects are
not more complicated than the topsides very obvious for pitch motions. Throughout
for oil, he says, just different. ‘We don’t the entire range of wave periods, from
see any technology or production hurdles operating conditions to the extreme event,
in producing these.’ There is no floating the Paired-Column Semisubmersible
FloaTEC’s E-Semi (left) and Truss Semi liquefaction yet, he says, but for a change, exhibits greatly improved motions over the
designs. ‘everybody wants to be the first’. OE

28 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 FLOATERS
traditional Gulf of Mexico semisubmersible.
The Paired-Column Semisubmersible
uses traditional hull components and
mooring system and can be fully integrated
at quayside to minimize the risks associated
with offshore construction and installation.
Upon leaving the integration facility,
the Paired-Column Semisubmersible
is immediately ready for hook up to its
moorings and risers, and the start of
production.
The benefit of the paired column
arrangement is clear for platform motions.
Additional benefits further improve the
concept in comparison to a traditional
semisubmersible. The additional benefits are
in the areas of lightweight deck structure,
increased robustness and protection of
hydrocarbon piping systems.
The inner columns of the Paired-Column
Semisubmersible provide excellent support
and minimal span for the topsides, resulting Surge Motion RAOs.
in a lightweight deck structure. Reducing
the deck span is especially important for a
dry tree system which must resist significant
loads from the drilling rig and the top-
tensioned risers.
Increased robustness comes from the
protection the outer columns provide to
the rest of the hull for such incidents as
boat collisions. The entire hull is designed
to control flooding due to boat impact
according to usual class rules and regulatory
requirements. However, the outer columns
greatly reduce the risk of impact to the
outer surface of the inter columns. The
paired-column geometry provides additional
protection against collisions and increased
stability during flooded compartment
scenarios. The paired-column geometry also
provides flexibility for locating riser piping
on the hull away from potential impact
locations.
In summary, a simple modification to a Heave Motion RAOs.
traditional production semisubmersible
provides a long list of advantages for offshore
oil and gas production. Most importantly,
the paired-column arrangement enables
dry tree production in deep and ultra
deepwater locations in the Gulf of Mexico
using a platform that can be fully assembled
quayside prior to installation offshore.

About the authors

John Chianis is president of Houston
Offshore Engineering and has 30 years of
experience in the development and design
of deepwater oil and gas facilities.
Philip Poll is manager of projects at
Houston Offshore Engineering and has
extensive experience in engineering
execution and the development and design
for deepwater projects. His specialty is
structural engineering and he actively
participates in the development of design codes and
methods for stiffened plate structures.
Pitch Motion RAOs.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 29

OE_M_4_NP_Bisso_FP.indd 1 28/9/09 15:00:23
 FLOATERS
‘There’s an advantage to having
multiple smaller diameter
columns piercing the water rather
than one big one.’
Robert Shivers

The first MinDOC nears completion

at Gulf Marine Fabricators. The hull
is scheduled for delivery to its initial
deepwater Gulf of Mexico location in
October.

construction – is just one of many unusual

Mobile MinDOC set for elements in the ATP Titan project. The
MinDOC – minimum deepwater operating
concept – itself is the first deepwater

maiden voyage dry tree platform to be built in the US

and the first structure of its type to be
deployed in the Gulf of Mexico. The $600
million drilling and production unit
ATP Titan, the first MinDOC floating platform, is scheduled to leave its will be moored at the Telemark Hub in
Texas graving dock this month destined for the deepwater Gulf of Mexico’s 4000ft of water, which comprises three
Telemark Hub. Russell McCulley gets a look at the near-complete fields: Mirage, at Mississippi Canyon
block 941; Morgus, at Mississippi Canyon
structure and talks to operator ATP about the project. block 942; and the Telemark discovery,
n approach, the hull for the ‘Of all the things we have to do on formerly Champlain, at Atwater Valley

O ATP Titan platform looks

impressive enough, recumbent
but still towering over the Texas shore
this project,’ says ATP vice president of
projects Robert Shivers, ‘flooding the dock
at the end is the easiest.’
block 63. Once the topsides – engineered
by Mustang and being built in Louisiana
by Gulf Island Fabricators, Gulf Marine’s
at Corpus Christi Bay. For the full view, The graving dock – the first to be parent company – are in place, ATP will
however, you have to descend 40ft of built on the US Gulf Coast for offshore use the ATP Titan to finish drilling and
scaffolding into the graving dock, where complete two dry tree wells at Mirage and
workers with Gulf Marine Fabricators one at Morgus, and complete one well at
are putting the finishing touches on the the Telemark field for a 17-mile subsea
structure. On its side, ATP Titan’s three tieback to the platform. ATP expects first
columns form an elongated iron pyramid, oil in the early part of 2010.
like the frame of a child’s swing-set Initial field development plans called
scaled to giant proportions. Water seeps for the construction of two MinDOCs to
through seams of the high metal wall that work in tandem at Morgus/Mirage and at
surrounds it, which stretches 250ft wide Telemark. But ATP announced last year
and 600ft in length. Pumps run constantly that the second unit would be put on hold.
to keep up with the flow, lifting the water Twin units for parallel development ‘made
out of the dock and depositing it in a sense in a $140 (per barrel) oil world,’
nearby canal. Shivers says. ‘But in a $70 oil world,

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 31

FLOATERS
‘I don’t mind being first when the however long it takes,’ Shivers says – and
then relocate the ATP Titan to Telemark
technology is this supportive.’ to launch a drilling program there.
T Paul Bulmahn ATP settled on the MinDOC option after
considering more traditional floating
platform designs. Planning coincided with
revised metocean guidelines introduced
after the devastating 2005 hurricane
season, when Katrina and Rita tore
through much of the Gulf of Mexico’s oil
and gas producing regions.
‘When we acquired these three
sequential development using a single from a Mirage/Morgus only project and properties, the licenses were about to
floating platform is more economical.’ preserved the leases at Telemark, which expire,’ Shivers says. ‘We had to put a
The tieback from the subsea well at ATP acquired from Statoil in 2006, along development plan in place right away
Atwater Valley block 63 to the ATP Titan with Morgus and Mirage. ATP, which has to preserve them, so we had to have
saved several hundred million dollars 100% interest in the entire Telemark Hub, something going quickly.’ The company
compared to building and installing a plans to deplete the reservoir at Morgus considered a truss spar, which was
second MinDOC. It increased production and Mirage – ‘four, five or six years, to be built in Finland. But the impact
on topsides payload of new metocean
Project manager Robert Shivers conditions was still being evaluated,
leads a tour at the recent ATP and foreign construction would have
Titan naming ceremony. left the project vulnerable to currency
fluctuations, in addition to the cost and
time of transporting the hull to the Gulf.
The ability to conveniently relocate the
platform to future developments in deeper
water drove ATP to a spread moored
design over a TLP, Shivers says. ‘We
decided to make this investment plan
something we could use over and over
again, build it here in the US and not
have the transatlantic transport to deal
with, not have the currency exchange
rate risk to deal with. That was part of the
consideration.’
Shivers was familiar with the MinDOC
design, developed by Bennett & Associates
president William Bennett and based on
a concept by Gulf Island chairman and
offshore oil pioneer Alden ‘Doc’ Laborde.
‘I had looked at MinDOC quite a bit,
back when [Bennett] was developing it
about ten years ago,’ Shivers says. ‘By
coincidence, he came by to see me just
about the time all this was in flux.’
The design, dubbed MinDOC 3 for the
concept’s third generation, came together
over a few months in late 2006. The unit
has three 265ft vertical upper columns
arranged in a triangle and connected
by a ring pontoon; below that, another
set of 220ft columns extend to lower
rafts. The MinDOC is designed to have
a spar’s stability in rough seas but can
accommodate much more weight on top.
That allowed ATP to develop Telemark
with dry trees, which will be mounted on
the T-shaped, two-level topsides deck. The
ATP Titan will also be equipped with a
2000hp modular drilling rig from Nabors,
capable of drilling to 25,000ft.
The platform has a production capacity
of 25,000b/d and 100mmcf/d of gas, and
can treat up to 15,000b/d of water.
‘There’s an advantage to having
multiple smaller diameter columns
piercing the water rather than one big

32 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 FLOATERS
one,’ Shivers says. The MinDOC’s payload ‘We didn’t think we’d get any
capacity was a significant factor in ATP’s
decision: the design allowed more heavy majors to look at us until we had
ballast – about 10,000 short tons – in the two or three [MinDOCs] out there.
pontoons and lower rafts. ‘That enabled us
to carry about 9500-10,000 tons of topsides But they’re coming to us.’
payload, even with the more severe William Bennett
metocean criteria,’ he says.
Bennett says the arrangement of the
columns also provides stability. ‘It’s hard
to put an unbalanced load on a triangle,’
he says. The MinDOC was originally
designed with nine mooring lines, ‘which showed that the amount of vortex induced riser system which is tensioned by a new
would be sufficient anywhere else in the vibration ‘would be within the range of design of hydro-pneumatic ram style
world’, but the ATP Titan will use 12-point tolerability for steel catenary risers,’ he tensioners provided by MHD. 2H Offshore
mooring to cope with the Gulf of Mexico’s says. InterMoor designed the mooring oversaw compliance for both systems.
100-year hurricanes and loop current. The system, which uses a combination of ‘Doc wanted a design for deepwater that
unit’s columns are outfitted with helical 5in chain and polyester rope; Stress could be built in US shipyards,’ Bennett
strakes to reduce vortex shedding; testing Engineering designed the top tensioned says. But the MinDOC ‘lends itself to a
grass-roots operation – it can be built
with components just about anywhere in
the world. That was the whole concept.’
The design has generated interest among
major deepwater E&P companies, he says.
‘We didn’t think we’d get any majors to
look at us until we had two or three of
these things out there. But they’re coming
to us.’
It’s often the smaller players that
are first to adopt new technology, with
Shivers observing: ‘It’s counterintuitive
the way things progress in the oil
industry.’ Some innovations that have
become industry standards were initially
developed and tested by the smaller
players. ‘Usually it’s an independent, and
born out of necessity,’ he adds.
At a naming ceremony for the ATP
Titan held in August, Laborde said he was
pleased to see an idea hatched ‘on the back
of an envelope’ come to fruition. ‘I know
it was not an easy decision,’ he said. ‘Most
oil executives are reluctant to take on a
new idea . . . so my hat goes off to those of
you responsible for the decision to build
the MinDOC.’
The graving dock ATP chairman, founder and CEO
at the Gulf Marine T Paul Bulmahn says the decision to go
Fabricators yard with a MinDOC at Telemark was not all
in Texas will be that difficult, given the design’s stability,
flooded when work payload and mobility. ‘We will be able to
is complete, allowing use [the MinDOC] for its 40-year life, from
the ATP Titan to project to project, in the deepwater Gulf,’
be floated out to the he says. ‘And that will be a huge plus.
Telemark site. ‘I don’t mind being first when the
technology is this supportive.’ OE

at Mississippi Canyon block only have we encountered Telemark would more

Telemark well 941 in about 4000ft of water, the development sands at than double the company’s
boosts expectations encountered some 250ft
of net oil & gas pay, more
greater thicknesses than
expected but we have logged
total production by 2010.
Bulmahn said the
ATP announced last month than double the pre-drill other hydrocarbon-bearing discovery ‘should lead to
that a well drilled at the estimates. sands that were not present upgraded production and
Mirage prospect turned up Chief executive T Paul in the original wells,’ reserve estimates greater
evidence of more pay sands Bulmahn said ATP was he noted. Even before than currently booked in
than the company originally ‘exceptionally pleased’ with discovery of the additional our third party reserve
projected. The well, drilled the initial results. ‘Not sands, ATP estimated that reports’.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 33

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 FLOATERS
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Pierce field.

To lease or to own?
projects including Fairfield’s Crawford
and Lundin’s Luno developments, with the
operators scheduling first production for
2011 and 2012 respectively.

That is the question Floaters expected to be available for

such developments over the forthcoming
five years include the 95,000b/d Petrojarl
The global financial crisis has been felt across the offshore business spectrum, none Varg and Bluewater’s 70,000b/d Hæwene
Brim, currently operating on the Pierce
more so than the leased floating platform sector. With the speculative FPSO bubble field. Equipped with dynamic positioning
well and truly burst, Catarina Podevyn and Dr Roger Knight of and a disconnectable turret, the 1997-built
Infield Systems ask whether the string of cancellations and project Hæwene Brim is suitable for the harshest
environmental conditions, including the
delays at the beginning of 2009 will continue, and if so for how long? Barents Sea sector, an area where we
he year thus far has been rather Despite Europe experiencing little expect increased activity going forward.

T disappointing for contractors with the

prevailing volatility in the price of oil
seemingly undermining a full recovery
movement towards near-term recovery, as
the majority of the region’s future potential
floating platform developments are
Indeed, although the majority of future
prospects within the North Sea are
expected to call for converted units, the
for the offshore industry. However, over expected to be operated by independents, increasing movement toward the harsher
the longer term, as a result of the rising without the substantial capital or expected conditions of the Barents Sea are likely
demand for hydrocarbons, particularly profit to warrant installing an owned to result in a growth in newbuild vessels
from Asia’s growing economies, Infield platform, demand for leased platforms is in the region. Sevan’s cylindrical design
expects floating platform demand to regain forecast to remain strong over the medium FPSO has attracted much attention from
momentum. term. operators seeking newbuild vessels,
Thus, while uncertainty remains, the Furthermore, as a region characterised with Chevron currently considering the
option of employing a leased unit is set to by ageing fields and depleting production option for its West of Shetland Rosebank
become increasingly attractive to operators levels, it continues to make economic development scheduled to start production
wishing to minimise capital expenditure sense, from an operator’s perspective, to in 2014, and Eni – developing Goliat, for
and diversify project risk. Indeed, during employ a leased unit. We have already the moment the largest floater project on
the second half of 2009 we have begun to seen Canadian independent Antrim the table in the region – also responding
witness tentative steps towards project Energy re-enter the market for a 30,000- positively to the Sevan FPSO concept.
negotiations recommencing, with 40,000b/d leased floater for its Fyne Dandy Although recovery across the European
the expectation that further contract areas, and over the forthcoming year we market is expected to remain slow, the
announcements will follow before year-end. anticipate further announcements on global outlook for leased floating platforms
altogether remains robust, particularly
from the Latin American and South
East Asian regions. The chart (left)
illustrates the cumulative fleet of leased
floating platform assets, including those
units currently under construction and
conversion with an expected delivery up to
2012.
Growth in the leased sector of the Latin
American industry has been most apparent
since 2008, with a further four leased
platforms due for installation during 2010,
including Modec’s Cidade de Angra dos Reis
MV22 destined for the Tupi pilot scheme,
and the relocation of SBM’s Capixaba FPSO
from the poorly performing Golfinho field
to the Cachalote field.
Looking beyond 2012, growth in Asian
and African developments is forecast
to continue, with a respective 31 and 38
Cumulative leased floating platform assets (1994-2012). planned floating platform projects in the
SOURCE: INFIELD FPSO ASSET DATABASE 2010 to 2016 period. Conversely, Europe is

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 35

FLOATERS
regasification FSRU units at various sites. Bluewater’s Aoka Mizu FPSO, installed
Under the current financial climate on the Ettrick field this year, is one such
with few developments in the European example. Equipped with a specialised
sector, contractor companies are already mooring system including a disconnectable
eyeing up future opportunities within the turret, the vessel is suitable for the harsh
rapidly expanding offshore sectors of Latin environmental conditions such as those
America, Asia and West Africa. We see this experienced in the Gulf of Mexico, where
in the remarketing of Bluewater’s Uisge disconnectability is a prerequisite, but
Gorm following the financial difficulties before its current contract it was moored in
surrounding Ithaca’s Athena development Southeast Asia for a considerable number
last year. With a nameplate capacity of of years without a firm deployment.
The FPSO Sevan Voyageur will remain 57,000b/d, prospective destinations for Altogether 2009 has proved a tough year
on location on Premier’s Shelley field as the aging floater include Afren’s Ebok for the leased FPSO contractor and with the
long as production is economically viable. development, offshore Nigeria, due on field continued instability in the price of oil only
The FPSO duty holder Wood Group in 2010 and the Eni-operated Kitan project, the most profitable developments are likely
Engineering (North Sea) introduced offshore Australia, expected to commence to come to fruition over the following year.
hydrocarbons on schedule to the Sevan production the following year with a daily It was with some considerable pleasure,
Voyageur on 6 August. crude production of 35,000b/d. therefore, that the UK community greeted
Premier Oil’s Chim Sao development, the recent news that the Shelley project had
expected to witness just 14 floating platform offshore Vietnam, with a planned daily produced first oil via the Sevan Voyageur
developments in the same timeframe, production of 50,000b/d, has also recently following Premier’s successful takeover of
and as such those contractor companies entered talks with Bluewater, with both the Oilexco’s portfolio earlier this year.
previously associated with the region may Uisge Gorm and the younger 65,000b/d Glas With the medium-term future
need to look to destinations further afield in Dowr named as potential platforms for the characterised by likely continued financial
order to guarantee future revenues. development. uncertainty, coupled with unerring
A newly evolving market sector is Although we expect the European leased global demand for hydrocarbon energy,
associated with the LNG and possibly CNG platform market to regain strength over these tricky dynamics may act in favour
industries. Shell in particular has shown its the medium-term, over the longer period it of the leased platform sector. Operators
commitment to the FLNG concept as a way is vital for contractor companies to remain may increasingly seek project risk
of monetising stranded gas reserves, while aware of future demand conditions and the diversification, particularly in difficult
at the other end of the chain Exelerate, destinations of platforms beyond the North operating environments and marginal
Golar and Hoegh are showing increasing Sea when undergoing construction and fields where successful production is not
interest in deploying a series of LNG conversion plans. always guaranteed. OE

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 RIG TECHNOLOGY
‘We have moved from a company
that had almost any conceivable
rig type you could think of …
everything that you have heard of,
we had it in our fleet.’
Ron Toufeeq

Fast forward to a floater future

With its mat-supported jackup spin-off and

four high-dollar ultra-deepwater drillships
under construction, Pride International
The first of Pride International’s
is meeting CEO Louis Raspino’s goal of new sixth-generation drillships,
restructuring the company to step into the Deep Ocean Ascension, taking
future. Jennifer Pallanich looks at the shape in Korea.
PHOTOS: MCNEE PRODUCTIONS
driller’s transformation in just four years.

n the last four years, says Ron Toufeeq, have heard of, we had it in our fleet,’ Randall Stilley heads up Seahawk and its

I Pride’s new senior vice president

operations, asset management and
engineering, the company has made great
says Toufeeq, who joined Pride in 2004 as
engineering vice president.
On 1 April 2004, a snapshot of the
fleet of 20 jackups; he was appointed CEO
of Pride’s mat-supported jackup business
last year.
strides in becoming an offshore drilling company’s fleet showed: two drillships, Pride’s focus on deepwater reflects
company with a primary emphasis on 13 semis, 35 jackups of which 23 were mat- the company’s view that it is the most
deepwater. The strategy, Toufeeq says, supported jackups, five tender-assisted resilient sector of the contract drilling
was to spin-off the mat-supported jackups rigs, three barge rigs, 22 platform rigs and market. Additionally, the sector has
and move toward becoming a floater 253 land rigs. A series of asset sales dots seen high utilization rates with average
drilling company with an emphasis on the timeline between then and now. contract lengths of four years.
the deepwater. To that end, Pride has The August spin-off of Seahawk with its Following the spin-off and asset sales
four ultra-deepwater sixth-generation mat-supported jackups was intended to over the last handful of years, Pride’s
drillships nearing completion in the allow Pride management to focus on the fleet picture has radically altered. As
Samsung Shipyard in South Korea. deepwater business and allow Seahawk’s of 1 September, the fleet included: two
‘We have moved from a company that management to base its strategy on drillships, 12 semis, seven independent
had almost any conceivable rig type you consolidation of low-spec Gulf of Mexico leg jackups, and three managed units as
could think of . . . everything that you jackups. With the spin-off complete, well as the four aforementioned drillships

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 39

RIG TECHNOLOGY
‘Every rig is being offered with a slightly performed simultaneously with main well
center activities; and landing christmas
different configuration. It appears the trees and subsea manifolds offline. A
flexibility is looked upon in good favor.’ triple activity rig will feature a dual
derrick with dual hoisting and offline
Russ Krohn subsea well construction activities using
an active heave compensated knuckle
boom crane.
All four of the new DP3 drillships are
750ft long with a breadth of 137.8ft, an
operating draft of 39.3ft and a drilling and
transit mode payload of 20,000 tons. They
Pride is building under a $3 billion feature a dual derrick, dual hoisting and are based on the Samsung Saipem 10,000
construction program. When the final offline stand building, and dual derrick hull. All can accommodate 200 people to
new drillship leaves Samsung, Pride will capabilities will include: drilling and meet the demands of the second drilling
have a total of seven assets capable of running top hole casings offline; building center when it’s used that way. The
drilling in waters beyond 7500ft. of tubular, BHA and casing stands drillships are outfitted to work in water
Pride’s revenue streams between
2004 and 2008 show how the company’s
strategy is unfolding. In 2004, Pride took
in its largest chunk of revenue from its
jackups and land drilling businesses, both
bringing in 23% of the total revenues.
Deepwater brought in 18%, midwater
brought in 7% and other offshore brought
in 14%. The company brought in its
remaining 15% of 2004 revenue from
E&P services and the unspecified ‘other’
category. The 2008 revenue sources
paint a more focused picture. Deepwater
accounted for 38% of the revenues, with
jackups bringing in 36%. Midwater
brought in 18% with the remaining 8%
of revenues stemming from the ‘other’
category. By 2012, Pride anticipates that
78% of its revenues will come from the
deepwater sector with midwater bringing
in 16% and jackups the remaining 6%.
‘We have a strategy. We have a clear
focus. We are financially disciplined,’
Toufeeq says. Outsiders are noticing the
company’s overhauled approach. Earlier
this year, Standard & Poor’s upgraded The Deep Ocean Ascension derrick ready for loadout from Samsung’s quayside facility
Pride’s rating to investment grade. (left), being towed to the drillship (right) and ready for placement (below).
‘We haven’t been a typical speculator,’
Toufeeq says of the company’s order of
the four drillships. Pride waited until
it was sure several contracts would be
forthcoming before giving Samsung the
go-ahead to construct the rigs. Three
of the four have five- to seven-year
contracts, but Pride has not secured a
contract for the fourth rig, to be delivered
in late 2011.
Each of the new drillships will be
capable of handling single, dual or triple
activity, or ‘any combination thereof’ as
specified by the client, says Russ Krohn,
director of engineering. ‘Every rig is
being offered with a slightly different
configuration. It appears the flexibility is
looked upon in good favor.’
The flexibility leaves room for later
upgrades, Krohn notes, although
upgrades will require a shipyard stay.
A single activity rig will feature a dual
derrick, single hoisting and offline
stand building. A dual activity rig will

40 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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OE_M_4_Page42.indd 1 29/9/09 14:35:25

 RIG TECHNOLOGY
Deep Ocean Ascension Deep Ocean Clarion Deep Ocean Mendocino Deep Ocean Molokai

Delivery date 1Q 2010 3Q 2010 1Q 2011 4Q 2011

Customization Single derrick with Dual derrick with Single derrick with Single derrick with
three heavy duty cranes three heavy duty cranes four heavy duty cranes four heavy duty cranes
and an AHC crane and an AHC crane

Contracted to BP, BP, Petrobras,

2Q 2010-2Q 2015 4Q 2010-4Q 2015 2Q 2011-2Q 2016

Pride deepwater rig specs.

depths of 10,000ft – although they are brine system to prevent contamination

designed for a maximum water depth of of the costly fluids. The mud and fluids –
12,000ft with an upgrade – and can drill to up to 6000bbls in the active system – can
40,000ft. The moonpool is 41ft by 84ft. be configured into 6000bbls of mud or
NOV supplied the bulk of the drilling 6000bbls of brine or split into a ‘double
equipment. NOV Hydralift cranes are on
all four rigs. The Deep Ocean Ascension
isolated dual system consisting of 3000 DSS series keeps
barrels of mud and 3000 barrels of brine’,
and Deep Ocean Clarion both have three Krohn says. Keppel busy
Hydralift knuckle boom cranes (93 tons Another goal was to speed up the riser Singapore’s Keppel Fels delivered the Maersk Discoverer, the
at 62ft) and one Hydralift AHC knuckle running process. To this end, Krohn second of three DSS 21 deepwater rigs, to Maersk Drilling in
boom crane (110 tons at 10,000ft water), says, the company signed on to use the August. Keppel’s Deepwater Technology Group and Marine
while the Deep Ocean Mendocino and Deep Vetco MR-6HSE automated latch and Structure Consultants jointly developed and own the DSS 21
Ocean Molokai each have four Hydralift lock system. ‘We’ve automated the riser design, which maximizes uptime while reducing emissions and
knuckle boom cranes (93 tons at 62ft). running process,’ Krohn says. It’s not discharges. The series features a dynamic positioning system,
Wärtsilä provided six 9000HP engines for certain yet, he adds, how much time this with the ability to attach to a prelaid mooring system.
the Deep Ocean Ascension, while MAN new system will save, but the company ‘Optimized for field development work, the new generation
B&W provided six each 9000 HP engines is expecting to record the improvements DSS 21 series is derived from the experiences gained from our
for the other three rigs. ABB provided during system integration testing. ‘We’re highly successful DSS 20 Maersk Explorer semisubmersible
the 8750kVA AC generators for all the also serial number 1 on this from Vetco,’ built in 2003,’ says Maersk Drilling CEO Claus Hemmingsen.
rigs. Rolls-Royce provided six 5.5MW he says. ‘Taking serial number 1 has The first DSS 21 rig, Maersk Developer (pictured above),
azimuth thrusters per rig. The thrusters, its advantages, but we also have to do delivered in June 2008, is slated to begin a four-year contract
Krohn says, give ‘a little more punch in our due diligence to ensure it’s going to with Statoil in the US Gulf of Mexico. Woodside Energy has
stationkeeping’. operate the way it’s been advertised to signed a three-year deal for the Maersk Discoverer to work
The rigs have 12,000 barrels of mud operate.’ offshore Australia. The third rig of the series is scheduled for
capacity, 2800bbls of base oil capacity and While the fifth generation drillships delivery in 2Q 2010.
18,800ft3 of bulk cement storage. were primarily meant for discovery Meanwhile, Keppel Fels says it expects to deliver Gold Star
‘We have added everything we could drilling, Krohn says, the sixth generation (pictured below), the world’s first DSS 38 semi, to Brazilian
think of,’ Krohn says. ‘It has all the – the category to which the four new operator Queiroz Galvão Óleo e Gás (QGOG) on time and within
features we believe are essential for drillships belong – is meant for field budget later this year. Also jointly developed and owned by
deepwater drilling.’ One of the features development and subsea construction. Keppel’s Deepwater Technology Group and Marine Structure
he likes to mention is an independent When the era of the seventh generation Consultants, the compact, cost-effective DSS 38 rig design has
drillship dawns, Krohn says, improved the operational requirements of deepwater’s Golden Triangle
performance and efficiency will be – Brazil, Africa and the Gulf of Mexico – firmly in its sights.
signs. A seventh generation rig will have Keppel Fels is building two of them for QGOG.
better drilling performance and lower This latest addition to the DSS series is rated to drill to
costs, with increased capacities in just depths of 30,000ft below mudline in over 9000ft water depth.
about every aspect while not necessarily It has an operational displacement of over 38,000t and can
becoming any larger than existing accommodate 130 personnel. The rig also features both
drillships, he says. While the trend of vertical and horizontal riser storage and is configured with eight
moving into the deepwater waters led 3000kW azimuth thrusters for stationkeeping.
from the fifth generation to the sixth QGOG’s second DSS 38 unit, Alpha Star, is scheduled for
generation, Krohn says, the seventh delivery in mid-2011.
generation won’t necessarily need to
work in even deeper waters unless an
operator is exploring a deep trench. ‘So
we take the 10,000ft (capacity) and make it
more efficient,’ he says.
As Pride keeps an eye on its future,
Toufeeq is already thinking about what
the company’s clients will be looking for
in drilling capability in the upcoming
years. Subsea construction work, batch
drilling and completion activities will
be in demand, he says, but ‘the heavy,
heavy focus will be in production drilling,
development drilling.’ OE

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 43

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OE_M_4_Page44.indd 1 1/10/09 17:28:20

 RIG TECHNOLOGY
‘We’re building all of them the same with
effectively the same pieces of drilling equipment
on all the rigs… If it’s red on one rig, it’s red on
the next rig and the next rig and the next.’
Carey Lowe

ENSCO 8500, the considering as many as 85 options over

Deepwater first rig in the

company’s $3 billion
ultra-deepwater
the better part of a year, he adds. ‘We got
to the end of that process and convinced
ourselves that the best thing to do for

departure expansion program,

is now drilling in
the Gulf of Mexico.
our shareholders and customers was to
continue to invest in our core business . . .
the business that we’ve been investing in,
which is the offshore drilling business,’
Ensco spent the better part of 2004 contemplating
he says.
how best to invest revenues it anticipated landing on ‘When you decide your world is limited
the books between 2006 and 2008. After considering to being an offshore drilling company,
many options, the board voted to pursue you have to focus on what you can do in
that space.’ The board decided to pursue
the deepwater in a meaningful way. meaningful deepwater activity despite
Jennifer Pallanich reports on the sector’s cycles. ‘A lot of things had
how the Dallas-based driller’s changed over the last 10, 15 years that
made that a very attractive market for
plans are starting to pay off. us,’ Swent adds.
With marching orders to focus on the
deepwater market, Ensco’s executives
formed a strategy that revolved around
providing clients with access to a total
of eight ultra-deepwater rigs – including
the existing ENSCO 7500 – for a day rate
that will keep shareholders happy and
the clients feeling like they’re getting fair
hen Ensco took delivery of deepwater rigs to work around the world value for the asking price. Ensco tapped

W its second deepwater rig – the

ENSCO 8500 semi – the company
doubled its ultra-deepwater drilling
helped Ensco come up with the strategy
to meet that demand, says Carey Lowe,
senior vice president. ‘There’s a growing
Keppel Fels in Singapore to fabricate
seven identical semis to form the 8500
series; the yard has delivered two already.
capabilities. The new semi joined demand for rigs,’ he says. ‘Mexico’s The ENSCO 8500 began drilling for Eni
the ENSCO 7500, which entered the making a foray into deepwater.’ Plus, he and Anadarko this summer. The 8501 is
company’s fleet in 2000. In September says, the deepwater Gulf of Mexico with slated to begin working for Nexen and
2008, the ENSCO 8500 started its journey its subsalt blocks, Brazil with its pre-salt Noble Energy this month in the Gulf of
from the Keppel Fels yard in Singapore draw, and West Africa, which ‘has some Mexico. The 8502 is slated for delivery in
to the US Gulf of Mexico. In June, the rig of the same subsurface geology as Brazil 1Q 2010 and is under contract to Nexen.
began drilling activities for Anadarko with the pre-salt area’ all factored in as The 8503 is slated for delivery in 4Q 2010
and Eni. The day before the 8500 went to the company formed its deepwater plan. and is under contract to Cobalt. The 8504
work, the drilling company took delivery Jay Swent, senior VP and CFO, says is slated for delivery in 2H 2011, the 8505
of the ENSCO 8501, the second deepwater that back in 2004, the company expected in 1H 2012, and the 8506 in 2H 2012. Ensco
semi in a $3 billion, seven-rig series that some excess liquidity in the next few is in discussions with potential clients to
will see delivery of the final semi in late years. ‘We thought it was important to contract the final three rigs.
2012. Ensco has about $1.4 billion more to understand what we might do with any ‘One strength of our strategy is to have
spend to complete the construction of all excess liquidity we might generate,’ a universal design for our whole fleet,’
seven rigs in the 8500 series. Swent says. The company focused on Lowe says. ‘We’re building all of them the
When the company took delivery of the good ways to invest in the business, same with effectively the same pieces of
8500, CEO Dan Rabun said: ‘We anticipate drilling equipment on all the rigs. If it’s
that approximately one-third of our Main deck 240ft x 255ft red on one rig, it’s red on the next rig and
revenue will be derived from deepwater Moonpool 30ft x 120ft the next rig and the next.’
Pontoons 56ft x 24ft x
operations by 2012, when all seven Lowe sees the similarity from semi to
310ft
8500 series rigs are expected to be fully Columns 50ft x 45ft semi as being helpful in many ways, not
operational.’ Keel to least of which is streamlined training.
Ensco cut its deepwater teeth with main deck 97ft ‘By having the same rig with the exact
the ENSCO 7500, which is contracted to Air gap 34ft at 55ft same equipment, we can train people
Chevron through August 2010 offshore drilling draft on the 8500 for the 8501, 8502, etc,’ he
Australia. Increasing queries for 8500 series specs. says. Additionally, he says, personnel

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 45

RIG TECHNOLOGY
‘When you decide your world is helideck can accommodate a Sikorsky
S-61 or S-92.
limited to being an offshore drilling Last year, Ensco opened an office
company, you have to focus on in Houston to support the company’s
deepwater focus.
what you can do in that space.’ Ensco’s philosophy has been to
Jay Swent reinvest in its business, good times or
bad, Swent says. ‘Most companies, when
times get tough, they pull in their horns
. . . shut everything down . . . at Ensco,
we’re countercyclical in our thinking
because we have a long-term view of our
experienced on another of the series will addressing the heart of the market and industry.’ He adds: ‘Bad times are the best
‘know where every valve is’ if they move trying not to address the last 10%,’ Lowe time to be working on your rigs.’ He cites
to work on a different rig in the series. says. the $1.3 billion, 10-year program Ensco
An added benefit comes from the need to While initial conversations with completed last year to upgrade its
stock fewer spares as replacement parts. prospective clients revealed they all existing jackup fleet, as well as the
Finally, Lowe says, building all seven wanted the capability of drilling in company’s purchase of 10 new jackups
rigs in the same yard will pay off in time 10,000ft water depth, few actually had from Keppel Fels. During that time
savings as Keppel Fels applies lessons immediate need for working in those period, the company also introduced its
it learned in building the early semis depths, Swent notes. Eventually, the debut deepwater driller, the ENSCO 7500.
to the rest of the order. Lowe says there compromise of an 8500ft of water rating When the final semi of the series – all to
was a noticeable efficiency improvement with the ability to upgrade was reached. bear a Liberian flag – rolls off the line at
between the 8500 and 8501. One reason for ‘Every single [customer] said 8500ft is the Singapore yard, Ensco will operate
this, notes Lowe, is that at the beginning, more than adequate for my needs right eight ultra-deepwater rigs. Swent says
the shipyard built the deck structure now,’ Swent says. The DP2 semis in the some may consider Ensco a latecomer to
and all the areas above the main deck in series are designed to work in 8500ft of the ultra-deepwater game.
relatively small pieces and used cranes to water but can be upgraded to handle ‘Sometimes being a little late is better
lift them. The approach was efficient, but 10,000ft of water. The upgrade would than being early. By starting with one
not as efficient as Keppel’s later decision address plumbing, mechanical interfaces ultra-deepwater rig and then watching
to use ‘megablocks,’ which involves and other elements that would enable the market develop, we were able to learn
lifting the deck structure components the semi to work in 10,000ft water depth, some valuable lessons and build an even
in much larger pieces with heavy duty Swent says. more capable rig at a lower cost,’ Swent
floating cranes. ‘They’ve really reduced The 8500 series has a rated drilling says. OE
the number of lifts they’ve had to make,’ depth of 35,000ft. It has an 8000 ton
Lowe says. variable deck load at operating draft
combined with an open deck layout to
A driller’s rig make the design suitable for subsea
Following the classic marketing completion activities, according to the
scenarios, Ensco asked its customers company. Other features include offline
what they wanted to see in a newbuild pipe handling capability, automatic
for drilling in ultra-deepwater. Totaling station keeping ability, and living
it all up resulted in a $650 million rig, quarters for 150. The semis are ABS
Swent says. But what was the customer classed as Maltese Cross A1 column
willing to pay? ‘You have a customer stabilized drilling units. The 8500 design
who wants a $650 million asset and wants increases capacities from the ENSCO
to pay $250,000/day for it. On a rate of 7500, features redundancy of critical
return basis, that makes no sense for rig equipment, open deck modular
shareholders,’ Swent says. It was time layouts for improved visibility and safer
to carry out a cost-benefit analysis on operations for cargo handling and offline
every element on the rig, along with work inclusive of subsea tree activity, DELVING DEEPER: Ultra-deepwater semisubmersible
interviewing customers about the various according to the company. Deepwater Horizon drilled one of the deepest oil and
features. Swent says the answer was NOV is supplying the lion’s share of gas wells to date earlier this year while working for BP
often: ‘I want that if I don’t have to pay for the drilling equipment: a 201ft x 46ft x and partners on the Tiber well in the US Gulf of Mexico.
it, but if I have to pay for it, I could live 40ft derrick that has a 2 million pound Operating in 4130ft of water, Deepwater Horizon drilled
without it.’ static hook load; a 6000hp drawworks the well to 35,050ft vertical depth and 35,055ft MD. The
One of the first features to wind up on with 2in drill line; a 1000 ton hydraulic Transocean DP semi, which came on the market in 2001, is
the cutting room floor was self-propulsion rotary, a 1000 ton top drive, drill string capable of working in water depths to 10,000ft.
for long moves. ‘This reduced our head compensator, travelling block and pipe In September, BP announced its Tiber well, drilled in
count by 16 people,’ Lowe notes. While the handling. Keathley Canyon block 102, found oil in multiple Lower
rig can make in-field moves up to 24 hours Hydril manufactures the BOPs and Tertiary reservoirs. Appraisal will be required to determine
on its own, larger moves require a tow Lewco the mud pumps. the size and commerciality of the discovery. One BP official
assist, he adds. The decision to opt out of For lifting, Ensco looked to Seatrax has said that the find could hold 4-6 billion boe-in-place,
self-propulsion was based on the reality for the deck cranes and chose Patriot for and the company has said Tiber could hold as much as or
that many rigs arrive in an area and work the riser gantry crane. The active mud more reserves than its 3 billion boe-in-place Kaskida field.
there for quite a while, Lowe says. pits can hold 4500 barrels. Reserve liquid BP operates the field on behalf of partners Petrobras and
Further, the semis are not designed mud storage is at 11,750 barrels. The bulk ConocoPhillips.
to handle harsh environments. ‘It’s mud/cement capacity is 26,000ft3. The

46 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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OE_M_4_Page47.indd 1 29/9/09 14:35:07
BUSINESS

Weathering the economic storm

GE Oil & Gas has now fully integrated the VetcoGray and Hydril Pressure Control brands into the group following their
acquisitions in February 2007 and April 2008 respectively. Meg Chesshyre talks to chief executive Claudi Santiago
about how the various pieces of this corporate jigsaw fit together and how they are faring in the current market conditions.
here are three platforms to GE Oil an aircraft engine there is no reason North Sea but also for export to shallow

T and Gas: Drilling & Production,

headed by Samuel Aquillano;
Turbomachinery led by Joe Mastrangelo,
why we cannot also monitor a subsea
compressor, a subsea valve and subsea
equipment, to really check the status of
water markets globally.
The SVXT is around 20% lighter than
traditional trees, has a reduced height
and Global Services providing technology that is sitting 2000m below the and also delivers essential functionality
aftermarket services under Jeff Nagel. All seabed,’ explains Santiago. in a pre-engineered, pre-configured
three vice presidents report to GE Oil & When GE bought VetcoGray, he says ‘modular’ way, according to Santiago.
Gas president and CEO Claudi Santiago. he saw it as an opportunity to bring some The first new product in the S-Series
VetcoGray and Hydril make up the of these technological advances from one is the SVXT shallow water vertical
Drilling & Production platform, which is industry to another. subsea tree, designed to operate safely
roughly a third of the company. ‘We are extremely excited about what and efficiently in harsh shallow-water
‘In total we are about 12,400 people. We we can continue to create together with environments. GE says that low-cost
expect over $8 billion of orders this year,’ the VetcoGray team and the value that we installation is achieved through a design
says Santiago, adding that, ‘we continue can create for our customers.’ VetcoGray that enables deployment using standard
to see our future with confidence despite allowed GE Oil & Gas to move into a new offshore jack-up drilling rigs with no need
the global economic crisis’. Pointing space: subsea. for major modifications.
out that the company has recently been Santiago emphasises that ‘there is a GE’s Smart Tools further improve
involved in some important projects in tremendous amount of cross-fertilisation installation by eliminating the need
China, the North Sea, West Africa and in technology from other industries, for diver or ROV assistance, says the
the Middle East, Santiago declares: ‘We where GE operates, into GE Oil & Gas. We company.
have been able to weather this massive are bringing a lot of innovation from the New design features include smaller
economic storm with, so far, very limited healthcare industry, from the aviation tree and fisher-friendly wellhead
damage to our business.’ industry, from the power generation protection structures, as well as an
Technology and innovation are a industry. My aspiration is to bring the innovative barrier philosophy that
priority, he says. Of the $6 billion that GE aviation mindset into the oil and gas removes the need for a separate tree
spends annually on R&D, around industry.’
$1 billion is focused on oil and gas. This
is in addition to the $170 million that Shallow tree
GE Oil & Gas specifically will spend GE Oil & Gas launched its new VetcoGray
this year to keep innovation flowing. S-Series SVXT subsea tree system at
‘One of the things that the VetcoGray the Offshore Europe show last month.
team immediately benefited from on Designed and manufactured in Aberdeen,
acquisition is the amount of technology the SVXT is predominantly aimed at the
innovation and expertise that GE is
working on from across other industries
besides oil and gas,’ notes Santiago. He
offers a couple of examples.
The VetcoGray team was looking for a
new material that was less corrosive, and
less heavy for its riser product lines and
subsea trees. GE came up with a special
composite used in aircraft manufacture The SVXT tree is
that was perfectly suited to VetcoGray’s designed for harsh
needs for very harsh applications. ‘tree on mudline’
Another example is remote monitoring shallow-water
and diagnostics, again introducing environments.
techniques from the aviation industry.
‘At the same time that we are monitoring

48 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 BUSINESS
NESS
Claudi Santiago: ‘My aspiration
is to bring the aviation mindset
into the oil and gas industry.’

The VetcoGray
SemStar5 subsea
electronics module.

cap. The SVXT comes with GE’s cleanliness, in addition to a real-time

VetcoGray SemStar5-powered ModPod diagnostic data link to the Nailsea
as standard control system, along with facility.
service and analysis packages including GE’s Aberdeen facilities include clude
flow-assurance, riser analysis and Silverburn House, which handles andles b both
oth
h
other valuable elements. GE says its internal and customer training ining
capabilities are unrivalled in today’s and is being developed as a
shallow-water subsea tree market. centre of excellence for subsea
ubsea a
GE is also developing a deepwater applications, while the TA1
horizontal tree (DHXT) engineered for (test and assembly) premises
misess iin n
up to 15,000psi and 10,000 ft, which has nearby Broadfold Road provide
d prov vidde
been optimised to minimise weight. It both an engineering and nd a
will have three primary configurations manufacturing capability.
ility. T The
he
– standard, enhanced and gas lift. The current workload at Broadf
Broadfold foldd
tree will be available from the end of the Road includes 17 treess for
year, but GE says it is already being bid BP Skarv, trees for EnCana
nCan na
in response to interest from the industry. Deep Panuke and frame me
It will primarily be built in Aberdeen agreements with Nexen, xen,
with the controls being supplied by GE Maersk and Shell.
Oil & Gas’ UK subsea production controls ‘The training facility
lity iss
centre of excellence, or ‘Smart Centre’, at extremely busy, supporting
pporttin ng
Nailsea near Bristol. learning across GE and
among our global custom
customer
mer
Controls service base,’ comments Santiago.
antia agoo.
As well as manufacturing the S-Series ‘As we see the industry
ustry y
SVXT tree in Aberdeen, GE Oil & Gas moving into more diffi
difficult
icuult
is investing $5 million in a controls and deeper reservoirs,
voirs,,
servicing facility at nearby Montrose. subsea applications are
ns arre
Once operational it will become the becoming more and nd mmore
orre
hub of GE Oil & Gas’ European Global important. We have about
ave abbout
Services business. 800 people in Scotland
tland d–a
Redevelopment of the facilities at population that iss very y
Charlton Road, Montrose, is now almost special in our business
sinesss
complete and the 13-acre site, which has due to its expert subsea
ubsea a
been associated with Scotland’s offshore domain knowledge.’ e.’
industry for the best part of 30 years, Many are engineers
eers
is due for inauguration this month as, doing research and d
among other things, GE’s new ‘world development focused ed onn
class’ subsea production control systems subsea applicationss thatt
refurbishment, repair and upgrading are not necessarily alwa
always
ays
facility which also services subsea and for projects that are goin
going
ng
surface production equipment, as well as to happen in the Northrth SSea,
ea,
capital drilling equipment for the offshore explains Santiago. ‘Some
Somme o off
market. these projects, wherere we ea are
re
The brand new facility incorporates going to use this expertise,
pertisse,
a clean room to enable hydraulic are happening in Australia,
ustralliaa,
component testing and diagnostics the Gulf of Mexico, Brazill o orr
to equivalent aerospace standards of West Africa.’ > overleaf
oveerlleafaf

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 4499

BUSINESS

Latest contracts
A three-year frame agreement awarded by Petrobras
to GE Oil & Gas’ drilling and production business in
June is valued at more than $250 million and involves
the supply of 250 VetcoGray subsea wellhead systems.
The first of these wellheads, being manufactured in the
company’s Jandira plant in the state of Sao Paulo, was
delivered in July.
Several sizes of wellheads are being provided under
this agreement, including the field-proven VetcoGray
MS-700 – the industry’s first all-metal sealing subsea
wellhead system – and VetcoGray MS-800 Fullbore
models.
GE Oil & Gas also landed a contract worth more than
$11 million to supply four VetcoGray subsea wellhead
systems and running tool rentals to leading Brazilian
independent OGX Petroleo e Gas. The order, the second
under a four-year frame agreement with OGX signed
in December 2008, will include the first two MS-800
subsea wellhead systems to be delivered in Brazil, plus
two MS-700s. Some of the components and tools used
for MS-800 systems also can be used for the MS-700,
providing additional flexibility.
Due for delivery in December, the equipment will be
manufactured at the company’s facilities in Jandira and
Macaé.
On the production control side, GE Oil & Gas won The new deepwater horizontal tree (DHXT), engineered for up to 15,000psi and 10,000ft,
a contract worth over $70 million from StatoilHydro will be available at year end.
this summer to upgrade a suite of subsea control
systems for the Norwegian operator’s Tordis Vigdis GE’s other Drilling & Production number of wellheads, is being hailed as
Controls Modification (TVCM) project. The contract acquisition, Hydril Pressure Control, the largest contract awarded to date in
will be executed under a subsea production systems is primarily based in Houston. It has a the industry (see panel).
frame contract previously awarded to GE Oil & Gas by small Scottish presence compared with ‘We continue to see strong business
StatoilHydro in autumn 2007. VetcoGray. Santiago adds however, that activity in the North Sea, and Norway
The TVCM project will be the first to deploy the ‘there is a tremendous synergy between in particular,’ he adds. The main
next-generation VetcoGray SemStar5 subsea electronics the VetcoGray business and the Hydril opportunities are for enhanced oil
module, which is being developed and manufactured at business that we are extremely excited recovery, upgrade and tiebacks. The
GE Oil & Gas’ Nailsea facilities along with the VetcoGray to see materialising. This is due to the company is currently conducting
ModPod subsea control modules and will be shipped fact that we can now put together an two initial engineering studies for
to Norway for installation offshore in 2010 and 2011. integrated product solution, a riser from the BP Foinaven oil field, for subsea
The TVCM project will benefit from the newly upgraded VetcoGray and a BOP from Hydril.’ processing and power-from-shore systems
GE Oil & Gas test and assembly facilities at Dusavik, He stresses that although VetcoGray respectively.
Stavanger, where the development of intervention tooling and Hydril are fully integrated into The initial engineering studies,
is mainly being carried out. GE Oil & Gas, forming the Drilling & which will involve obtaining accurate
GE Oil & Gas was also awarded a five-year contract Production business, the VetcoGray and data for field development and its
by StatoilHydro this year to deliver subsea operations Hydril brands have tremendous value in technical and commercial feasibility,
services. The contract has an estimated value of between the industry and it doesn’t make sense represent a continuation of work already
$25-$30 million per year and will be managed by to abandon this heritage and customer completed by GE Oil & Gas to support
GE Oil & Gas in Dusavik. The scope of services to familiarity. The product systems have BP in developing the Foinaven field
be provided under the agreement relate mainly to the retained their names so that customer for future production enhancement.
installation and operations phases of StatoilHydro’s recognition is there, but customers are Target completion date for the initial
subsea fields, including: engineering, procurement, also aware that there is a new synergy engineering studies is 3Q 2009, but
the production of equipment and tools, and electro and capability given their acquisition the scope of the studies is now being
and mechanical workshop services for corrective and by a much larger globally integrated expanded with additional units.
planned maintenance in subsea drilling. company. Claudi Santiago’s final message is
Meanwhile, in Angola, ExxonMobil subsidiary that ‘the world is still going through a
Esso Exploration Angola (Block 15) awarded Business opportunities massive economic down cycle, but we
GE Oil & Gas a contract in September for the supply Looking ahead, Santiago sees business are convinced that a stable economic
of subsea production equipment for the Kizomba opportunities maturing very rapidly recovery will require hydrocarbons.
satellites linking into the existing Kizomba A and B field offshore Australia via several subsea As long as we continue to invest in
developments. GE, which earlier provided equipment projects offshore Western Australia. technology and innovate, I’m confident
for Kizomba C, will supply: subsea trees; manifolds; In addition, West Africa, Angola in that we will have an exciting future as
jumpers and connectors; controls equipment; umbilical particular, is an important market, he a company. Keeping innovation flowing
termination assemblies; subsea distribution units; and says. GE Oil & Gas has also recently been and developing world class products
flying leads. Topside equipment will be installed at the awarded a contract worth over will help our global customer-base gain
Kizomba A and B FPSOs. $250 million for the supply of wellheads enhanced access to new and existing
to Petrobras in Brazil which, in terms of reservoirs.’ OE

50 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

OFFSHORE ENGINEER REVIEW OFFSHORE EUROPE 2009

@
REVIEW

Job done
‘I really think that we have achieved d
what we wanted to do at the conference, nce,
which was to make sure that it was
relevant, wide ranging g
and international,’
declared SPE Offshore e
Europe 2009 conference ce
chairman Thomas Thune
Andersen (pictured) as the
show closed. Organised
by The Offshore Europe
Partnership, a joint venture between
Reed Exhibitions and the Society of
Petroleum Engineers, the overarching
conference theme this year was ‘Energy ergy at
a crossroads: making choices’.
Observing that the AECC’s main
auditorium and many of its conference nce
rooms were often packed out, Andersen rsen
said: ‘What I have particularly noted d
is that, as we had hoped right at the
start of this process, the debate around
und
the environment and the climate
has been in everyone’s discussions. A
recognition that the industry must engage
ourselves, and focus on minimising
our environmental footprint, while
continuing to provide energy to all. An
extremely important thing is also that hat it
has not been a discussion about oil and
gas or alternatives but oil and gas and nd
alternatives. Only if we drive both will we
take things forward.’
Justin Tadman, divisional managing ging
director of Reed Exhibitions and
co-chairman of the Offshore Europe
Partnership, said: ‘It was most
encouraging to see so many packed
aisles and stands at what was the largest
exhibition in the event’s history, with so
many new companies participating, and
to get such good feedback on how much
business was being done.’
Leo Roodhart (pictured),
2009 SPE president and
co-chairman of the Offshore
Europe Partnership,
described the conference
as ‘the best ever’ and said it
would be difficult to beat in
the years to come. ‘It proves
again that, if you offer quality, people will
appreciate this and come to what you have
to offer, even in what is a difficult time for
the oil and gas industry.’ The event was
very well organized and the quality of the
technical conference was exceptional, he
added.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 i

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 REVIEW
September’s SPE Offshore Europe 2009 Manzoni warned that support for energy to maintain investment in technology.’ The
reform could diminish amid a growing policymakers who gather in Copenhagen
show drew record crowds, again sense that the worst of the economic crisis should have a similarly lengthy outlook, he
demonstrating the biennial Aberdeen is over. But Hedegaard said turmoil in the said.
event’s happy knack of rising above energy market and the economic crisis ‘Policy needs to have a long-term
have in fact raised awareness among structure,’ that recognizes the role
prevailing inauspicious market conditions. consumers. ‘It is as if energy has become hydrocarbons will invariably play in the
More than 49,000 attendees were logged fashionable,’ she said, as people are world’s energy future, Gould said. But
over the four days, 20% up on the increasingly interested in where energy ‘long-term is not easy in politics’.
comes from and concerned about climate
previous record attendance figure set in change. With the world’s population
2007. OE samples the sights and sounds expected to grow from 6.6 billion to some 9 Shell/Total sound
of a hugely successful conference and billion by mid-century, the ‘twin challenge’
alarm on UKCS costs
of energy security and climate change ‘will
exhibition, with reports by Jennifer be the key conundrum of our time’ and Changes must be made to the UK’s
Pallanich, Russell McCulley, dominate global politics. regulatory and fiscal regimes if the full
John Sheehan and Meg Chesshyre. Hedegaard said even if climate change potential of the UK oil & gas industry is to
were removed from the equation, energy be realised, warned Greg Guidry, newly
companies would need to diversify, and installed executive VP for Shell Upstream
should embrace renewable energy as a
Copenhagen calling way to maintain a market edge and attract
Guidry: ‘Incentives have to
Officially, the opening plenary session new staff. ‘A market for offshore-based be more material across the
heralded the start of OE09. But much of the renewables is emerging,’ she said, adding board if they are to have an
discussion was dominated by a meeting that E&P and service companies should impact.’
still three months off: the UN Climate pay close attention to what happens in
Change Conference, which will take place Copenhagen. ‘From your industry, I hope
in Copenhagen 7-18 December. And while for support and cooperation.’ An agreement Europe. The current fiscal regime is
the panelists – Talisman president and CEO ‘is doable, provided we all have the political unsustainable if the UK is to attract
John Manzoni; Andrew Gould, chairman will. And you can help us create that will.’ reasonable levels of investment over the
and CEO of Schlumberger; UK energy Lord Hunt said the Copenhagen talks coming years, he said. The opportunities
minister Lord Hunt; and Danish minister could lead to even more stringent targets in the region will inevitably be small but
of climate & energy Connie Hedegaard for carbon emission reduction than the current regime does nothing to address
– vowed support for greater cooperation the ambitious ones already in place in brownfield opportunities.
between government and industry in the the UK. But he agreed that oil and gas ‘Incentives have to be more material
upcoming talks, there were signs that would continue to play a dominant role across the board if they are to have an
the negotiations, which could result in in energy supply for some time, and impact,’ said Guidry (pictured). ‘We
stringent targets for the reduction of global said the government should encourage welcome signs that the government
carbon emissions, will be anything but Gould: ‘It’s critical in a down understands that the budget earlier this
painless. year was a first step and more needs to
Some members of the panel, moderated cycle to maintain investment be done.’ He warned that time was short,
by conference chairman Thomas Thune in technology.’ however, adding ‘we can’t wait even two
Andersen, cautioned that the Copenhagen years to take action’.
talks could devolve into a shades-of-Kyoto Guidry said current cost levels are
stalemate. But with the US administration unsustainable if the UK is to attract the
apparently on board this time around, technology development that would help kind of investment needed over the coming
the fate of the negotiations could lie with squeeze hydrocarbons from the mature years to unlock the 16-25 billion barrels
developing countries, especially China and UK continental shelf. The industry needs of reserves still to be recovered from the
India, who might baulk at regulations that a ‘stable regulatory regime’ that also UKCS. In the Middle East the cost of each
could put the brakes on development. has some flexibility in order to make the barrel of oil per day capacity is around
As with the response to the financial necessary investments in technology, he $10,000; in the Gulf of Mexico it is $30,000,
crisis, ‘both energy [security] and said. but in the North Sea it is $40,000, he noted.
climate demand global solutions’, said Gould said policymakers should accept At an OE09 topical luncheon, Total boss
Manzoni. There is ‘an appropriate role’ for that the transition to a less carbon- Christophe de Margerie called on the UK
government in crafting an energy policy intensive world will be lengthy, with government to cut taxes to keep oil and gas
that reflects sensible, if politically difficult, hydrocarbons still dominant for many De Margerie: ‘It is true
solutions, and a need for nations to take years, and should therefore be looking
a global approach to energy policy rather at promising technologies, such as there is a decline, bit not as
than focus on ‘short-term self-interest’, he carbon capture and storage, that could much as we thought it could
said. ‘Both these lessons are applicable to be implemented relatively quickly. With be.’
energy and climate.’ coal likely to remain in wide use, he said,
Hedegaard: An agreement ‘a technical solution to the use of clean
coal’ would be the most effective route to flowing from the North Sea, while telling
‘is doable, provided we all reducing greenhouse gases. contractors to cut their costs too.
have the political will. And Schlumberger, despite the loss of 12,000 De Margerie met with UK secretary of
you can help us create that jobs over the past several months, has not state for energy Lord Hunt to express his
cut back its research and development concerns at how taxes had risen from 30%
will.’ budget, he said. ‘It’s critical in a down cycle in 2000 to 40% and now to 50% – a concern,

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 iii

 REVIEW ISSUES
he said, for all players in the region. North Sea assets by just drilling more Walker: ‘I sincerely hope there
De Margerie was also scheduled to meet wells and investing over $500 million over
with Norwegian oil minister Terge Riis- the coming three years. We are going to is not pressure on people to do
Johansen after the show. improve integrity, we’re going to drill more the job quicker and slicker.’
‘We cannot continue like this,’ he wells and make sure the platforms are
told OE09 attendees. Costs were not capable of running for the life of the field.
only following the price of oil but were ‘At the moment, our calculations show
also rising on safety requirements, the economic cut off is around 2020 and At the same time there were 14 major
environmental costs and security in with a bit of fair wind we should be able to injuries reported in the second quarter,
general. ‘If we continue to have a 50% tax extend to 2025,’ Koot said. against 30 in the whole of last year. ‘We
rate and if we have a potential tax on CO2 The next step would be to look in the have seen almost half the amount of
emissions, plus, plus, plus, we have to vicinity of the hubs to ‘see if there is any injuries from last year in three months,
consider whether or not it is doable. It is exploration acreage or discoveries to be although most have been in the slips, trips
a problem for all of us and the message [to picked up’, and after that the company and falls category. It may be that a lot of
Lord Hunt] is “yes, we’re staying . . . but not would see if there is any third-party people are worried about their jobs and
at this price”.’ business. ‘There have recently been some I sincerely hope there is not pressure on
De Margerie pointed out the North Sea discoveries around our North Sea assets, people to do the job quicker and slicker.’
was still the fourth largest producer of oil so we will be looking at companies around Walker said the figures should be taken in
and gas in the world. ‘It is true there is a us to see if we can get them over our the context that last year’s were the best
decline, but not as much as we thought it infrastructure to Sullom Voe.’ since the HSE took over the running of the
could be. For Total today we have 35% of Meanwhile, the company is looking to offshore division. ‘It is a wake up call for
our production coming from the North Sea. move forward with development of the the industry that things can go up as well
Can the majors still play a role? The answer Falcon and Tern North discoveries that it as down. I’m asking the industry not to be
is most definitely yes. At any cost, at any bought just the week before OE09. complacent and to keep the pressure on.’
price? No. But that is true for any place in The four exploration blocks (210/25a, He added: ‘I recognise the challenges in
the world, nothing special for the UK, or 211/21a, 211/16c and 210/20f) include the keeping ageing installations fit for purpose
Norway or the Netherlands.’ finds, which TAQA will develop as subsea at a time when industry is looking at the
tiebacks to the Tern field platform. technical and cost demands in developing
Koot added: ‘If you look at the Tern existing fields, especially in the context
TAQA on the prowl reservoir in the north it has got several of the economic climate and the ongoing
TAQA Bratani is on the hunt for more fault blocks and several terraces and in energy debate.
assets in the UK North Sea as it looks the last fault block in the row is the Falcon ‘However, this is not an excuse for
to boost production from the region discovery. Falcon together with the last delaying or putting off essential work.
to 80,000b/d. At OE09, the company’s Tern North blocks are a good development Industry must pay attention to every detail,
managing director, Leo Koot, said TAQA, and at the moment we are in the advanced no matter how small, if potentially it puts
which is 75% owned by the UAE state of stages of field development planning work safety at risk.’ He also said that the HSE is
Abu Dhabi, was hunting for a new hub to for that whole Tern North area and to planning to set up a programme next year
raise production from current levels of develop that as a subsea tieback to the Tern to look at how the industry manages the
around 40,000-45,000b/d. facilities.’ ageing process.
‘Our plan for the UK is very much He said an investment decision was ‘With the KP3 review we did
focused on hubs,’ said Koot. ‘We have got likely to be taken for the project in 1Q acknowledge that the industry had come a
the Brae infrastructure hub and we have 2010 for early drilling over the summer fair way towards improving the condition
got the Northern North Sea infrastructure period. The range of reserves in the of its assets offshore,’ explained Walker.
hub.’ TAQA is in a strong financial position field is currently estimated at 5 million ‘What I don’t want is for the industry to
to buy up acreage if a suitable opportunity to 25 million barrels. ‘We should have a say – great, job done, we’ve sorted out
comes along, he said. ‘The longer-term good idea of what the reserves are by the health and safety and we’ve sorted out asset
strategy is that we want to increase our summer of next year,’ said Koot. integrity, we can move onto other things –
Koot: ‘We are first going because it’s certainly not the message we
set out in KP3 and it is not the message I
to focus on maximising the Walker warning on want to give out to the industry.’
value of our Northern North safety stats Walker warned that the last time the
Sea assets by just drilling industry faced an economic crisis on a
The number of hydrocarbon releases and similar scale to today, it stopped investing
more wells.’ major accidents on installations on the in infrastructure and it took many years to
production to 60,000-80,000b/d in the UK. UKCS increased in the second quarter of bring it up to an acceptable standard. ‘The
We won’t be able to do that with just the this year according to Steve Walker, the industry is telling me that they have learnt
existing infrastructure, and we need a new head of the Health & Safety Executive’s their lessons from that and Oil & Gas UK
significant additional large hub. We will offshore division following the retirement says we will be continuing to invest, we
take our time evaluating to make sure of Ian Whewell. realise the infrastructure has got to be kept
when we do an acquisition it will be the In an OE09 briefing, Walker said in the right condition. I really want to call the
right fit, at the right time and the right 21 significant hydrocarbon releases were industry to account on that and make sure
price.’ reported in 2Q 2009 compared to 61 in the they put their money where their mouth
In the meantime, Koot said TAQA would whole of last year. is. It would be so easy for the maintenance
invest in its current assets over the next ‘That is a third of the whole of last issues of the infrastructure to start being
three years. year, but in just three months. It is an reined back and for people to say “we won’t
‘We are first going to focus on indication that there is still a potential for do it this year, we’ll do it in a couple of years
maximising the value of our Northern hydrocarbon releases.’ time”. That is a recipe for disaster.’

iv OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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 REVIEW ISSUES
Walker also said he hoped that under his Light: ‘To secure the world’s ‘We believe the next generation subsea
watch the offshore division would become will have much more focus on enhanced
an efficient and effective regulator, and one future energy needs, the life recoveries,’ Halvorsen said.
that was respected. of existing assets will have to Under the $90 million contract that FMC
z Responding to Walker’s remarks, Robert be extended.’ and Petrobras signed recently, FMC will
Paterson, Oil & Gas UK’s health and safety supply a subsea separation module that will
director, said: ‘Over the last 21 years the separate heavy oil, gas, sand and water in
industry has made huge progress in putting asset integrity at the top of their agenda to 900m of water.
in place multiple barriers on its offshore secure the world’s energy supply in a safe The deal represents the first commercial
installations to prevent escalation of way. The independent risk-management application of the FMC technology by
dangerous occurrences and to reduce their group lays claim to being the largest Petrobras and the fifth commercial
impact. provider of independent verification in application since the technology emerged.
‘In the last four years alone, it has the North Sea, having worked on more Halvorsen: ‘We believe the
invested more than £4 billion in offshore than 80% of installations and pipeline
asset integrity and it is extremely infrastructure in the UK, Dutch and next generation subsea will
encouraging to note that the number of Norwegian sectors. have much more focus on
major and significant hydrocarbon releases ‘To secure the world’s future energy enhanced recoveries.’
fell by 17.5% in 2008/09, to the lowest figure needs, the life of existing assets will have to
on record. be extended, and in a way that is safe and
‘Step Change in Safety, the UK’s flagship reliable,’ said Light. ‘The industry has to Tom Munkejord, FMC’s director of process
safety initiative, has created a specific asset get smarter at managing the performance systems, confirmed the project will use
integrity workgroup to support industry- of its key assets. With our experience PipeSeparator, an advanced compact
wide engagement on asset integrity issues. and independence, we are well-placed to separation system which desands inline,
Step Change’s Hydrocarbon Release advise industry on asset performance and developed jointly with and licensed from
Reduction Toolkit has also been revised management. StatoilHydro.
and updated. ‘It is a huge challenge for operators Oystein Holt, VP of process and
‘Both of these projects will support to maximise production from offshore processing technology at StatoilHydro,
our aims to further reduce the rate of assets while ensuring that people and said: ‘It’s better to do the processing as
hydrocarbon releases. However despite the environment are safe, particularly in far upstream as possible, as close to the
the progress made, we know that safety is the current economic climate. But it is a wellhead as possible.’
never done. We are resolved to keep full challenge that must be met. It requires a The separation and pumping system is
focus on this important issue throughout comprehensive understanding of assets intended to go online in two years. With the
the life cycle of the industry, irrespective of and integrity-management strategies Marlim Sul award, FMC has three systems
the prevailing economic climate. that engage employees at all levels in an in the installation or building phase and
‘We are in a fundamentally different organisation,’ he said. two that have already begun production.
place today. However, we recognise that we Industry reports indicate North Sea ‘Without subsea technology, these
can never be complacent with regard to the assets are deteriorating and systems and developments could not be done at all,’ said
safety of our workforce. processes need to be kept under close FMC executive vice president John Gremp.
‘While overall the injury rate is coming scrutiny, said Light, but this was becoming
down, the latest statistics also show that the increasingly difficult as asset transfers
accidents which do happen have tended to are commonplace, which often leads to a Salmond sees signs of
be of a more serious nature.
‘It is therefore important that we engage
hybrid of old and new systems, conflicting
priorities and poorly managed change.
confidence returning
in an industry-wide dialogue, including ‘The whole UK energy supply is on a Scotland’s First Minister, Alex Salmond,
the regulator, trade unions and the knife edge and we need to make sure those told a breakfast briefing hosted by
workforce, to look at those areas where assets are still able to produce and to do the Aberdeen & Grampian Chamber
our efforts have seen an improvement, that safely,’ Light added. LR had, he said, of Commerce that there were signs of
such as the rate of 3-day injuries and minor identified the three short-term priorities confidence returning to the oil and gas
injuries,’ concluded Paterson. ‘We need to the industry must address if offshore assets industry. ‘The oil price is the thing that
understand what we are doing right and are to be safely and reliably exploited. measures the confidence of the oil and
apply this knowledge widely to reduce the ‘They are striking the balance between gas industry,’ he said. ‘The fact that it has
risk of major injuries.’ safety-critical issues and operational doubled in the past nine months is rather
pressures, identifying the safety-critical important, giving a new confidence to the
areas of maintenance so they are never industry. The fact that the capital markets
Extending the asset deferred, and ensuring competence.’ are returning to something like pre-deluge
integrity reach normality is hugely important in terms of
the future direction and confidence in the
Lloyd’s Register has merged two of its Brownfield bound industry.’
smaller divisions as it looks to boost its When the subsea separation and pumping Salmond said that much of the
global reach in independent verification system begins production at Brazil’s 25 billion boe remaining in the waters
and inspection activities. The company has deepwater Marlim Sul field in two years, Salmond: ‘Normality is
hooked up its oil and gas, and chemicals and it will carry a label that differentiates this
power divisions, enabling it to ‘look over system from others FMC Technologies hugely important in terms of the
the entire energy value stream’, according has supplied. It will be the first one to be future direction and confidence
to Iain Light, group energy director. used in a mature environment, pointed out in the industry.’
And Lloyd’s Register (LR) is now Tore Halvorsen, FMC’s senior VP of global
challenging oil and gas companies to put subsea production systems.

vi OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

ISSUES REVIEW
around Scotland could be exploited if the The price fluctuation picture is to build a commercial system with 10,000
conditions are right. ‘That points to an complicated by the global recession stations, which has been used in BP and
industry that is not going to last one, two, and somewhat by a certain amount of Apache onshore fields.
three or four years, but one that is going to schizophrenia in the pricing mechanism Ella described how Integrated Asset
last another 10, 20, 30, 40 years or more.’ with declining oil demand on the heels Modeling (IAM), despite its proven
of high storage amounts but projected capabilities, is ‘probably lucky if it’s at the
tightness in the market in the future, he 20% (adoption) mark’ because companies
ITF seeks new solutions said. Some of the supply and demand issues are so reluctant to take up new technology.
ITF, the industry technology facilitator are working themselves out, he said, as And Songhurst spoke about an
which celebrated its 10th anniversary lower OECD demand and Opec cuts are innovation – floating liquefied natural gas
during OE09, issued two fresh calls ‘canceling each other out.’ (FLNG) – that was a promising technology
for proposals at the show based on the Perceptions come into play, too, he said. as much as 40 years ago but has yet to be
output from two theme days held earlier ‘Twenty dollars, I really do think, has put to use. One obstacle is learning how to
this year. ITF is looking for global gone. I think $30, $40, $50 as a long-run put together the various elements of LNG
technology developers to come forward price has gone,’ Horsnell said. This year, he production and shipping already in use and
with solutions to challenges facing in-well added, is on course to have an average oil adapting them for offshore. But the bigger
communications and the use of light well price of $60. ‘$60 only looks bad relative to one at the moment may be economic, with
intervention vessels (LWIVs) for subsea the $99 average of last year.’ natural gas prices far too low to justify
well abandonment. Overall, he said, ‘it’s starting to look a the estimated $1 billion cost of building an
On the in-well communications front, little bit better.’ Horsnell said the question FLNG system. ‘Even onshore LNG plants
ITF is seeking technological proposals to of a sustainable price for oil remains. ‘It’s are struggling to make money,’ he said.
eliminate the need for production logs and not $20. It’s not $30. It’s not $40, nor is it
retrofit of technology in wells that have $140. We’re narrowing the range,’ he said.
been installed without gauges. A fair price will also dictate what happens Energising futures
And in regard to LWIVs for well in the world of alternative energy, he said, OPITO, the Oil & Gas Academy, staged its
abandonment, ITF is encouraging any as well as projects like oil sands, which interactive ‘Energise your future’ oil and
organisation or individual to make require a price environment of about gas lifestyle and careers event on the final
proposals for improving operating $75-$90. Saudi Arabia, Horsnell said, likes day of OE09, giving companies direct access
limitations associated with their use. $75 oil as a sustainable price. ‘We could to young people already studying the key
ITF operations director David Liddle just say the fair price is what Saudi Arabia science, technology, engineering and maths
said: ‘The main driver for using a LWIV requests.’ subjects needed to fill an expected industry
is that cost savings of up to 50% could skills gap in the future.
potentially be achieved compared to a Companies including BP, Balmoral Group,
conventional mobile offshore drilling unit.’ Keeping ahead of the curve ExxonMobil, Maersk Oil, Schlumberger,
Owned by 22 major operator and service It’s a cliché that big companies are Shell, Technip and Total were among the
companies, ITF has been responsible for inherently conservative and innovation- heavyweights taking part. Around 350 pupils
securing direct member funding exceeding averse. But there is much truth to it, aged 15-17 attended and the initiative was
Liddle: ‘Cost savings of RMI president Steve Jacobs told an OE09 adjudged a great success, with OPITO chief
audience. executive David Doig declaring: ‘The new
up to 50% could potentially Moderating the discussion ‘From bright format gives the next generation a better
be achieved compared to a ideas to implementation’ Jacobs and the understanding of what they can aspire to
conventional mobile offshore panel – Richard Ella, EAF production be within the industry and the varied entry
manager at Schlumberger; Brian routes they can take depending on their
drilling unit.’ Songhurst of Energy Power Consultants; personal interests and skills.’
£40 million. Its technology portfolio consists Chris Friedemann, senior VP of ION As well as touring the exhibition the
of 39 projects linked to £20 million of direct Geophysics; and Professor Axel Roseno of pupils heard from conference chairman
investment. Copenhagen Business School – discussed Thomas Thune Andersen, James
the underlying reasons behind industry’s McCallum of Senergy, graduate rising stars
reluctance to adopt new technologies and and other senior professionals currently
Pricing oil examples of how companies have managed working across the spectrum of industry
While the industry lived for nearly 16 years to buck the trend. disciplines.
with an expectation that oil would cost Large companies that play too Andersen said: ‘I firmly believe it is
between $18/bbl and $22/bbl, no new conservatively ‘risk losing an opportunity imperative that the industry continues to
sustainable price has yet emerged, Paul to be ahead of the curve’, said Roseno. They recognise the importance of informing,
Horsnell, managing director and head of can also lose a competitive advantage, developing, and listening to the oil and
commodities research at Barclays Capital, he said, as others seize that opportunity. gas industry’s next generation. I hope
said during OE09. ‘Going forward, what Instead, companies should encourage that all pupils will actively participate
should we think of as a right price?’ he asked. innovation within their ranks and seek out in the event and leave inspired about the
‘No new $20 has emerged. What you have is a collaborative opportunities. potential opportunities that exist within
market trying to feel out the new $20.’ Friedemann described one such the industry.’
The heady highs of $150/bbl oil and collaboration: the development of ION’s Doig: ‘The new format gives
the subsequent plunge to $30s/bbl have seismic gathering system Firefly, a method
made it difficult for companies to have a that eliminates the grid of cables and the next generation a better
‘belief in the backend price’ of oil. ‘When batteries and produces far more detailed understanding of what they
the numbers fell to the $40s, to $35, a lot of data using much smaller crews. BP and can aspire to be within the
things didn’t work,’ Horsnell said. ‘Today, Apache each put in about $8 million for
$40 seems very, very cheap.’ the Firefly effort; the money allowed ION industry.’

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 vii

 REVIEW STANDS
Cased hole services tractor Digital protoypes
Schlumberger debuted its TuffTRAC cased Engineering companies across the offshore
hole services tractor, which has full reverse oil and gas sector face a raft of complex
and active traction control capabilities. challenges. To achieve commercial success,
‘TuffTRAC delivers more than 40% North Ocean 103, currently being built at a they must maintain optimum levels of
efficiency over conventional tractors, shipyard in Spain, which will be used for design quality. At the same time, they
resulting in more pushing power Apache II. The Apache’s high-performance need to reduce costs and streamline an
downhole,’ said Zied Ben Hamad, existing pipelay equipment will be increasingly complex supply chain.
marketing and technology manager, transferred onto the new ship at Technip’s Digital prototyping solutions are the
Schlumberger Wireline. ‘The system’s construction yard in Pori, Finland, creating answer, says Autodesk, which also
unique reversing capability reduces fishing an up-to-date version of a proven and well unveiled a new product at Offshore Eurooe
risk and its modular design makes it easy utilised pipelay vessel. aimed at bringing modern 3D design and
to deploy in short rig-up situations.’ Apache installed its last pipeline at the visualisation capabilities to plant designers
Schlumberger has conducted field tests end of July for the E.ON Babbage project. and engineers.
in North America, Europe and the Middle Built in Galveston, Texas in 1979, the According to the company, digital
East and has tractored equipment more vessel has completed over 400 pipelay prototyping with Autodesk Inventor
than half a million feet in over 200 runs. projects, for the most part involving rigid 2010 and Autodesk Navisworks can help
The system is engineered to withstand the steel pipe. Apache II will be available for businesses: drive innovation without
shock of a perforating gun detonation and work at the end of this year. Its first job escalating development costs; win
can convey any other cased hole service. involves flowline and umbilical installation more complex projects and deliver on
The new tractor runs on multiconductor next year for the BHP Billiton-operated time; design better products; improve
wireline cables; the 31/8in diameter tool Angostora project offshore Trinidad in collaboration between global design teams,
has a pushing capacity of 300lbs per drive about 30m of water. EPC contractors and component suppliers;
section. A maximum string of six drive and streamline processes and reduce time
sections can be deployed in tandem for a to market.
tough-duty true 1800lbs of pushing power, CaTS gets the cream
said Schlumberger. Active traction control A talking point on the Expro stand was
provides the ability to monitor and change the recently completed six-month trial of
the pressure on each drive wheel to FlowCAT, a retrofit wireless safety valve,
optimise traction in either direction. in a gas well onshore Italy, marking the
Capable of operation to 350°F (177°C) and first use of Expro’s Cableless Telemetry
20,000psi (1361 bar), the system’s robust System (CaTS) in a flow control application.
power pack can operate without requiring CaTS allows information to be
cool-down periods. The tractor includes transmitted in real time to and from
a built-in tension sub, electrical release downhole instruments without the use of
sub, casing collar locator, addressable cables. Its two-way transmission capability
tractor perforating safety switch and shock enables the remote control of downhole
absorber. instrumentation, opening the path to the
radical redesign of downhole completions.
FlowCAT is a fail-safe closed safety valve
that can be installed in the well’s existing
safety valve nipple profile, or by using an
alternative suspension mechanism, and
is controlled from surface using the CaTS
Electromagnetic (EM) wireless telemetry Slimline sidetrack solution
technology. The 41/2in FlowCAT valve An evolutionary well construction
was deployed into the well using standard technique developed to reduce the
slickline intervention methods and, over telescoping effect during well construction
the course of the six months, was cycled through the use of flush-jointed close-
and inflow tested regularly during periods clearance cased liners took pride of place in
of both production and injection. the Caledus display.
The valve was seen to perform reliably The SlimWELL SideTRACK system is
and consistently throughout the test with available for use today to maximise the
no false closure events observed, reported size of pipe at TD from a planned casing
Steve Hudson, Expro’s wireless well exit that requires two or three casing
solutions technology manager. ‘Now that seats to access stranded reserves or small
we have proven the reliability of the valve accumulations during in-fill drilling.
mechanical components and the robustness According to Caledus, the system has
of the wireless telemetry scheme over the potential to increase the recovery of
an extended duration test in the onshore recoverable reserves in mature fields prior
Extreme makeover environment, we are working to finalise the to decommissioning, a significant issue in
Technip is completely rejuvenating its necessary system enhancements to allow the North Sea for 2009 and beyond.
30-year old pipelayer Apache, resulting in us to take FlowCAT to the offshore platform Caledus, which has invested more than
a new vessel – Apache II – details of which environment. We feel well placed to take £4 million in development and testing
generated much interest at OE09. FlowCAT to offshore trial in the next three since 2004 to make commercial systems
The company recently purchased the to six months.’ available, said its SlimWELL FullWELL

viii OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

STANDS REVIEW
following on from the establishment of a ‘Offshore is a vital industry for the BP
centre in Piacenza, Italy, which should be Group and this sponsorship offers us a
ready for operations by the end of October. new way to do business,’ explained Paul
Cercato said: ‘We have started with the Lowther (pictured), global marketing
hydraulic drilling rig to step up the training communications manager for aviation,
of people on these new types of equipment. marine and energy lubricants. ‘Castrol’s
We are installing a latest generation aim is to always find ways
simulator in Piacenza and in Houston. The to improve performance,’
system uses the same software as we have he added. ‘Through this
on our rig and the same hardware that we campaign, our customers
have on the drilling console. It has a screen will be able to connect
where we can project information as if on a winning at the highest
real hydraulic rig.’ level in football and
He said a driller’s chair has been Castrol Offshore’s high-
installed and that what the trainee driller performance lubricants, in an engaging
ARMED FOR ACTION: A UHD workclass ROV custom is doing is visible on-screen. ‘You can see way.’
designed by Schilling Robotics for Acergy and designated everything being done by the driller but
the ACV was displayed by FMC, which now has a 45% also from different viewpoints. The system
stake in Schilling. Also on the stand was the new Atlas also allows for mistakes to be made and Helicopter surveillance
7 function rate grabber, making Its European market corrected.’ Oil & Gas UK and NATS Services launched
debut. This robotic arm is designed to be paired with the Cercato said it would take about four a new helicopter surveillance system for
existing Titan 4 and provide superior overall manipulative weeks to train a drilling operator on the HH the North Sea to boost offshore safety. The
capabilities that will improve the efficiency of ROV series system but that Drillmec was also system uses multilateration to track flight
intervention tasks. planning to roll out its training services to paths all the way to an installation in real
other companies for conventional drilling time. It is designed to detect aircraft down
training. to 500ft above sea level or better.
implementation would lead to significant ‘The longer the downturn goes on, the Multilateration uses multiple position
well construction cost savings as well as more need there will be for training new points to determine the exact helicopter
safety and environmental benefits due to people. A lot of people will move away from location. Equipment is being fitted to 16
the significant reductions in materials the industry during the recession and new host platforms, divided into four clusters
consumed and produced during well people will be needed,’ he added. each of four platforms. As soon as a
drilling. helicopter leaves the 80 mile radar zone,
‘It is likely that smaller rigs will be able its transponder responds to a signal which
to drill wells that still maintain an optimum ‘Route One’ to South Africa is then detected by receivers on each of
size of tubular at the producing zone but Offshore Europe marked the offshore trade the four platforms in a cluster, allowing
were able to start with a smaller footprint show kick-off for lubricants specialist complete surveillance of the helicopter
and smaller diameter surface casings,’ Castrol Offshore’s major soccer-themed flight. This data is then sent to the control
the company explained. ‘The oil and gas promotion leading up to the World Cup tower at Aberdeen Airport via the oil
industry has been calling for slender lean finals in South Africa next June and July. company data links. Computer analysis
well profiles for some years but can only With leading football figures, led determines the helicopter position by
adopt these techniques once a suitable set by Arsène Wenger, acting as brand triangulation.
of practical solutions are made available for ambassadors, Castrol is specifically Three of the four clusters are now
use.’ targeting the offshore and maritime completed. Flight trials have begun to
industries with a year-long campaign in ensure the coverage is complete from these
support of its status as an official sponsor of three clusters and that the system accuracy
Drillmec looks offshore, the 2010 FIFA World Cup. is within the expected limits. Phase two of
expands training The campaign represents the offshore
division’s first-time use of sponsorship,
the flight trials is due to start in January
2010, with all four clusters expected to be
Italy’s Drillmec is looking to expand its or social media tools, to drive business fully operational by June 2010.
offshore reach after recently starting up in this industry. Through a dedicated
operations with one of its platform-based online presence and special events for its
HH series rigs offshore the offshore audience, the company will use its Buoyant business
Congo. Drillmec’s business ‘more than just oil’ theme to communicate Balmoral Offshore Engineering
development manager, business performance and product benefits, announced during OE09 that it is
Marco Cercato (pictured), in the context of football. investing £2 million plus in a new 30,000ft2
said the company is also A touchscreen on the company’s stand buoyancy manufacturing facility at its
talking to a European enabled visitors to log on and sign up to Aberdeen HQ. Designed by Balmoral’s
company about possible play Performance Manager, its newly engineering and technical teams, the plant
shallow water barge-based work offshore launched fantasy football-based game with will ‘substantially increase production
Tunisia. World Cup tickets as the ultimate prize. capacity’ for the company’s buoyancy
‘We’re also talking about work in Lake Other online content includes relevant products, particularly marine drilling riser
Albert in Uganda and about operations on news updates, competitions and a B2B modules.
a new drillship which is being fitted out for social networking presence, accessed via Group chairman and MD Jim Milne
intervention in deep waters,’ he added. www.castrol.com/offshore. Special World said: ‘Because we are seeing an increase
Meanwhile, Drillmec is set to open a new Cup-themed customer events will be staged in orders for drill riser buoyancy and
HH-series drilling rig training simulator at other offshore trade shows around the elastomer products, such as bend
in Houston before the end of the year, world. restrictors and cable protection, investment

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 ix

 REVIEW STANDS
mandrel with no internal connections. pipeline tooling, pumps and valves, and
With its high strength, rare earth magnets, seabed fastening systems.
rated to 350°F, it is claimed capable of
removing up to 200lbs of ferrous material.
It is available in common casing/lining Valves to go
sizes and weights – from 133/8in to 7in – and Valve specialist Bifold returned to Offshore
has a casing compatible facing material to Europe to introduce further additions to
minimise casing wear. its established product range, including
instrumentation ball and needle valves,
block and bleed valves, and monoflanges.
Power down deep Also on display was the Marshalsea range
Perhaps best known for its turbines, of chemical injection pumps for hazardous
Siemens was keen to emphasise at OE09 environments.
that it has a much broader scope these Bifold lays claim to being the
days. Siemens Oil & Gas CEO Tom Blades manufacturer of the widest range of
explained: ‘We’re trying to move up in the switching instrument valves and pumps
decision-making process of our customers’ in the oil and gas sector, its valve products
by offering a more complete suite of goods and accessories having been specifically
and services rather than the products for designed with hazardous and hostile
which the company is famous. To that offshore and subsea environments in mind.
end, Siemens has acquired a number of
Jim Milne with Scottish First Minister engineering companies in recent years,
Alex Salmond on Balmoral’s OE09 stand. among other moves. ‘That’s allowed us to Let there be light
get higher up in (our customers’) projects Divers at The Underwater Centre In
is needed in manufacturing capacity and and become their partner of choice.’ Fort William are putting a new energy-
staffing resources.’ The company’s services have expanded efficient LED (light-emitting diode) fibre
Offshore projects to which the company to include pipeline engineering, FPSO work illumination technology for lighting up to
has recently shipped product include and the development of electrical solutions 100m of fibre optic cable through subsea
Canapu in Brazil, Gimboa and Kizomba to replace hydrocarbon-powered processes, trials at various depths.
offshore West Africa, MA:D6 in the Indian such as gas turbines. Developed by PhotoSynergy, a spinout
Ocean, Tyrihans, Skarv and Snorre in Blades said subsea power generation from the University of St Andrews, the
Norwegian waters and Thunder Horse in is the next logical step in deepwater PSL-3000-M is an LED fibre illuminator that
the Gulf of Mexico. development, and perhaps the company’s will supply a continuous line of light for
future. ‘Getting that power down there and 100m at subsea level. Offering a permanent
making it efficient and useful is, of course, light source for subsea navigation, and
Ironing it out the sweet spot for Siemens.’ A cutaway requiring as little as 7W of power, the fibre
The Magnostar high-capacity magnet tool model of the STC-ECO compressor, a canned illuminator cable is visible at depths of up
from M-I Swaco Wellbore Productivity centrifugal unit with an electrical motor to 150m.
provides operators with a single piece tool drive, featured on the company’s stand. The Operating close to The Underwater
designed for high torque strings, but can compressor has been field tested onshore Centre’s private pier, in depths starting
also be used in conventional workstrings. and is undergoing tests for subsea use. at 20m, the first trial involved the fibre
The tool’s magnetic optic cable being attached to two diver
surface area allows umbilicals as they performed a diver
for high volume Turning up the heat rescue. Two of the Centre’s ROVs were
ferrous debris Precision sub-contractor Barker Collins also deployed – one to perform diver
extraction when expects orders worth up to £1 million to observation of the rescue and the other to
circulation is not stem from its participation in the OE09 monitor the ROV observing the divers.
enough for wellbore exhibition.
clean-up. Managing director Chris Carter said
The tool is run the company’s ‘excellence through Decom in depth
in the well on the innovation’ policy, that sees components Members of the Shetland Decommissioning
workstring for a variety of applications, produced in lead times that are often half Consortium turned out in force at
including: displacements, post perforating, those of industry rivals, had generated OE09 to reinforce its role as a leader in
prefracturing, multizone completions, ‘an impressive enquiry pipeline’ among undertaking and supporting North Sea
milling, burning, fishing and smart existing and potential customers. decommissioning projects with continuing
completions. It can be run whenever there The Barker Collins stand focused on how development of infrastructure at Lerwick
is a potential for significant ferrous debris the Sheffield-based company is capitalising Harbour and a marketing campaign
in the wellbore. on a recent £5.5 million investment in CNC highlighting the islands’ considerable
In Norway recently, a 7in Magnostar run machining technology by providing oil experience, resources and adaptability.
in-hole with several other M-I Swaco tools and gas components such as whipstocks, Lerwick’s track record includes
in the clean-up string collected 13.2lbs of stabilisers, cans and reamers for drilling, contracts as part of the Frigg Cessation
ferrous metal debris, most of which was Project, including decommissioning
small in size although large slivers up to an 8730t module support frame. The
6in long were recovered. In five offshore consortium’s core members are Lerwick
projects that M-I Swaco cited, the tool Port Authority, contractor Peterson SBS
removed between 3kg and 28kg of debris. and waste management specialist Veolia
The Magnostar magnet is a single piece Environmental Services. > overleaf

x OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 NautilusRigging
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Call For Papers

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Exhibit and Sponsorship

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Opportunities Now Available

OE_M_4_NP_Seawell_QP.indd 1 29/9/09 09:27:42

OE_M_4_NP_Nautilus_QP.indd 1

OE_M_4_Ad_Pagexi.indd 1 29/9/09 14:35:51

 REVIEW STANDS
interfaces for: dynamic positioning (DP), burning rubber on the track launch our
independent DP joystick, manual thrust new hoses – one of which has been designed
control, vessel automation, central bridge specifically so that the rubber does not
alarm system, chart radar, conning display burn when deployed in its own field’.
and communication devices. ContiTech Beattie’s new Fire Rated
Kongsberg Maritime chief engineer Thor Diesel Hose, tested and certified by Lloyd’s
Hukkelås, who headed up the K-Master Register to OSG/1000/49 to withstand 700ºC
project, said: ‘Total ship operation takes for 30 minutes, will typically be used for
place from this chair, with the main fuel oil suction and delivery, with up to
information displays close to the seated 50% aromatic content. It is also suitable
Development of Lerwick Harbour as a operator, making the intense nature of for seawater, mud and other offshore
deepwater centre for decommissioning ship operation on the aft bridge a more applications, as well as long-lasting
continues. comfortable and less stressful situation.’ bunkering applications. The new Floating
Hose range, for bulk material, diesel
At the port’s Greenhead Base, where and potable water applications, features
facilities include a 20,000m2 bunded and Just champion integral buoyancy layers which eliminate
licensed decommissioning area, the Sport and sports men and women figured the need for separate tie-in flotation collars.
quayside is to be significantly expanded prominently in the plans of many of this
and options are being explored for further year’s exhibitors. At both the Lloyd’s
development there. An area to the south of Register and ContiTech Beattie stands Three-in-one subsea NDT
Greenhead was dredged last year to provide Britain’s new-found pre-eminence in the Non-destructive testing specialist
9m water depth for two additional berths, world of cycling was highlighted. Applus RTD UK unveiled a novel subsea
extending to 180m of quay. Construction Multiple Olympic gold medal winner inspection tool, hailing it as the first fully
is scheduled to begin in 2010, increasing Sir Chris Hoy popped up on the LR stand customisable NDT phased array solution
the berthing capacity at Greenhead by a to dispense tips on which combines and integrates ultrasonic
third, with a 1000t capacity heavy lift pad cycling, training phased array and time of flight diffraction
included in the design. and fitness. Group (TOFD) techniques with alternating
At Dales Voe Base, with 12.5m of water energy director Iain current field measurement (ACFM).
alongside the quay, work is under way to Light described The company tested the system in 130m
expand the laydown area to facilitate the Sir Chris as a of water offshore
handling of a range of offshore-related ‘fantastic example Australia; the
projects. Concepts have also been developed of a committed entire project
for deepwater infrastructure with 20m of and dedicated was completed
water adjacent to Dales Voe and next to athlete’, adding: by ROV using
North Greenhead where over 10 acres of ‘He embodies the custom-designed
land were reclaimed as part of the Port Lloyd’s Register tools. The test
Authority’s £12 million dredging and land ethos of “Life focused on
reclamation project. Matters” as he is detailed site preparation, coating removal,
focused, prepared and determined to be the inspection and coating reinstatement at a
best.’ number of locations where inspection for
Bridge workstation Throughout Lloyd’s Register’s 249-year inter-granular stress corrosion cracking of
puts it all together history, clients had benefited from its
capability to deliver quality services for
12in 13Cr butt-welded joints was required.
Charlie Lawther, advanced NDT manager
The K-Master integrated aft bridge challenging and at Applus RTD, said the aim of the test
workstation, unveiled by Kongsberg complex assets, was to ensure operational suitability and
Maritime, is being hailed as an industry often in remote prolong the life of vital assets.
first in that it combines navigation, control areas of the world,
and manoeuvring as well as machinery said Light. Offshore
automation functions in one solution. Europe provided ‘a Remote cuts
It provides access to all major control great opportunity to Oil States Industries exhibited its new
systems through an ergonomic design showcase many of External Cutting Manipulator (ECM)
said to improve the safety and efficiency of our achievements, toolset for remote-controlled subsea
offshore operations. The K-Master operator including a recently cutting applications in the offshore
sits within easy reach of interactive launched service decommissioning industry. Using the new
that highlights the toolset and methodology, a surface control
importance of being station can routinely and remotely control
prepared for HSE linear straight, linear angled or castellated
inspection visits and how we can support cutting operations.
clients who want to achieve a pro-active Onboard cameras and positioning
approach to HSE requirements’. sensors provide real-time cut monitoring
Another Olympic cycling champion, information. On completion of the cut, the
Victoria Pendleton, was on hand at the systems depressurise, and the ROV returns,
ContiTech Beattie stand for the unveiling of collects the tool, and then repositions it or
two new hose products. Managing director installs it back into the tool deployment
Andrew Esson said it was ‘a great honour frame for recovery back to the surface. The
to have someone who has achieved the new ECM toolset includes a valve chest
highest standards time and again while module, a clamping module and a cutting

xii OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 www.spe.org

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OE_M_4_NP_SPETriad_FP.indd 1 28/9/09 18:20:11

 REVIEW STANDS
module along with a tool-to-ROV interface specified HIPPS (high integrity pressure
unit. protection systems) for deepwater HP/HT
The new toolset can perform multiple cut applications. The two companies believe
configurations in a single deployment and combining their specialist expertise in high
covers the most commonly required sizes, integrity valve manufacturing and systems
ranging from 12in to 60in. In trials earlier integration respectively will enable them
this year, the new solution performed to supply a complete HIPPS solution that
what Oil States believes to be the first is flexible, reliable, easy to install and
fully remote-controlled, fully submerged commission.
castellated cut. Richard Dodd, chief technical &
commercial officer at BEL Valves, said: ‘By
combining resources, BEL and Hima-Sella
Growth mode have provided a one-stop solution to HIPPS
Growth talk – both the corporate and the Pressure’s on and can design, engineer, supply, warrant
swellable types – was in the air at the A new medium-pressure ball valve for use and certify each application in line with
Tendeka stand. The company was formed in up to 15,000psi was unveiled at OE09 by customer specification.’
in April to purchase Sensornet, Swellfix Swagelok. The new FKB series trunnion-
and Well Technology AS. As Malcolm style ball valve features Swagelok’s patent-
Pitman, Swellfix VP for Europe and Russia, pending direct load design, said to deliver Compact ROV
said, Tendeka has good market share, ‘but
where do you go from there?’
a more consistent seal across a full range
of pressures. Innovative stem and end
ready for work
Tendeka expects to grow through connection seals prevent shell leakage and An addition to the SMD
acquisitions as well as research and provide robust cycle life even in severe work-class ROV family
development. For the Sensornet research, conditions. launched at OE09 combines
said John Dick, regional manager for ‘Even when depressurisation of compact size with a powerful punch. The
Europe, FSU and Africa, focus will likely the system occurs, the direct load ‘Atom’ is SMD’s new entry level WROV,
be on finding different applications for design ensures a leak-tight seal upon superseding the Quark and Quasar
fibre optics. ‘Right now, we’re using it for repressurisation of the system,’ said Bill Compact and sitting below the medium-
temperature and pressure,’ he said. But Menz, the company’s market manager. sized Quasar and flagship Quantum in the
there are a number of other factors that Swagelok says its medium-pressure ball company’s work-class vehicle range.
may need monitoring, such as seepage valves meet the performance requirements According to SMD, the Atom design brief
amounts, he said. ‘For fibre optics, it’s an of common offshore applications such as was to create a lightweight, cost-effective
open book, what you can think up.’ topside wellhead control panels, chemical package that minimises the consumption
One item Tendeka is investing in is injection panels, well workover panels of deck space. The new vehicle is said to
spiral wrapping fibre optic around tubing and control systems. A bottom-loaded be easy to operate, retaining the power
to obtain compaction data as a reservoir stem design eliminates system blowout for and robustness of an hydraulic vehicle but
produces, Pitman said. ‘Swellables is enhanced operator safety. of comparable size and weight to a large
another technology where there are endless electric ROV.
ideas,’ he said. At the heart of the Atom is a compact
Setting the standard 60hp or 100hp Curvetech hydraulic power
GLOBAL Aberdeen O-Rings & Seals unveiled a pack that can feed hydraulic energy to both
PARTNERS: new explosive decompression resistant propulsion and tooling circuits. The Atom
Offshore Engineer perfluoroelastomer for seals used in ultra- can provide 500kgf of horizontal thrust; at
magazine and aggressive, down-the-hole and processing least 50% more than an equivalent sized
workspace applications. electric ROV, claims SMD.
solutions provider The company said its Perlast G92E
Regus jointly elastomer combines high levels of
announced a chemical resistance with an increased Platform power
global partnership explosive decompression capability Centrepiece of the MTU display was the
whereby the to set a new performance standard for company’s Series 4000 diesel engine for
magazine will perfluoroelastomer seals in oil and gas offshore applications. The type 4000 P63/83
have a permanent exploration and processing. 12,16 and 20 cylinder engines are primarily
base in the Suitable for environments up to 260°C, designed and optimised for use on offshore
Regus facility on Riverside Drive, Aberdeen, and access G92E has tested successfully in a range platforms to cover their power and
to the company’s 1000 or so other centres in 75 different of high temperature, high pressure and emergency power supply requirements, as
countries. Pictured concluding the agreement are OE’s aggressive gas conditions, including well as fire extinguishing pumps.
UK sales director Neil Levett (right) and Regus area sales those described in NORSOK M710, and is The new ATEX certified engines, with
manager Martin Jones. currently undergoing further industry and a power output range from 1140kW to
Rob Garza, OE’s publisher, commented: ‘The fact that we international explosive decompression 2800kW (1529-3752bhp), are designed for
have flexible access to a choice of two facilities in Aberdeen standards testing. unlimited continuous operation as well
was a decisive factor in embarking on this partnership,’ as partial load operation for emergency
added Garza. ‘This is pertinent, as OE was for many years a power supply applications. They comply
North Sea specific magazine before going global in 1997. Single source HIPPS with all current emission guidelines such
Our Aberdeen office now provides us with a base from BEL Valves and Hima-Sella launched as IMO and EPA Tier II, as well as TA air
which to work with the companies in our ancestral home to their new partnership which aims to emission standards issued by the German
help them to promote their products and services globally.’ provide operating companies and their government - all without the need for
service providers with single-source, fully additional exhaust gas after-treatment.
Published by Offshore Engineer, Official Magazine for SPE Offshore Europe 2009. Printed by RR Donnelley & Sons, Illinois, US. Repro by Screaming Colour, London, UK.

xiv OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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OE_M_4_Page52.indd 1 29/9/09 14:34:58

 LOUISIANA LOOKOUT
‘We’re close. And all of this ‘With recovering gas
stuff is heavy. So close prices, I do think you’ll
and heavy usually mean see more activity on the
proximity, and indeed shelf.’
that’s what you see here.’ Larry Benedetto
Eric Smith

associate director of the Energy Institute risk plays (onshore) Texas, Oklahoma,

Survival at Tulane University. For drillers, the

risks and expenses of E&P are much
lower onshore than off. A state effort to
Louisiana. All of them are attracting the
dollars of companies that have played in
the Gulf of Mexico.’

mode put the tax burden of E&P more on par

with that of neighboring Texas will make
Louisiana onshore even more attractive.
The anticipated resurgence of natural
gas prices, which some predict could
come as early as next year, might help
A big player in offshore oil and gas from ‘Shale’s getting the headlines,’ Smith alleviate some of the suffering, says Larry
says, ‘and jackups are leaving the Gulf.’ Benedetto, a vice president at the New
the start, Louisiana has seen its share of The shallow Gulf of Mexico has Orleans energy investment firm Howard
boom-and-bust cycles. Will the crash become an increasingly difficult place Weil. ‘With recovering gas prices, I do
of 2008/09 be just another temporary to do business. Fields near the coast think you’ll see more activity on the
have been thoroughly drained of their shelf,’ he says. ‘But I don’t think you’ll see
dip, or will the state’s role in the offshore ‘easy’ oil, and larger operators have been anywhere near the activity you saw just
industry emerge diminished when the selling off low producing properties to three years ago, four years ago. One of
recovery comes? Gulf of Mexico editor smaller outfits. But insurance costs, the issues has been the storms. The cost
sparked by a brutal series of Atlantic of insurance has increased dramatically,
Russell McCulley reports. hurricanes, have increased by as much and it’s difficult for some small operators
ouisiana is actually two states as tenfold, making the remaining to get insurance to protect themselves

L divided by an interstate highway,

goes the old anecdote people there
sometimes use to describe the state’s split
hydrocarbons prohibitively expensive for
the independents to produce. The credit
crunch has also had a profound effect,
during hurricane season. So that’s an
added risk, and many investors prefer to
avoid that risk and focus on the onshore,
personality: a largely rural, conservative says Briggs. ‘Part of it is that the low- especially with the new technology –
and Protestant north, and the coastal, hanging fruit has been picked,’ he says. there are so many new possibilities with
Catholic south of Cajun Country and New ‘But then we go into a recession. And the shale plays.’
Orleans. The two regions have a common some of the smaller independents, their Even as the shelf languishes, the
government, but share little in the way of funding resources disappeared with the deepwater Gulf is awash with activity.
culture or history. recession and the crash of Wall Street and But Louisiana today benefits less from
Pretty much the same could be said the money markets. the action than it would have in years
for the current state of Louisiana’s oil ‘But one other thing contributing to all past, when the majors and supporting
and gas industry. There’s the north, this,’ he continues, ‘is a migration away industry had a larger presence in the
where, the collapse of natural gas prices from the high-risk natural gas plays, state. ‘Everyone is excited about the
notwithstanding, the vast reserves of the the high-risk conventional wells that deepwater prospects,’ Smith says. But
Haynesville Shale Play have launched a you have in the Gulf and on the shelf, the current downturn, and the industry
massive exploration drive. to the unconventional, practically zero- consolidation it will produce, is likely to
And then there’s the south.
‘It’s worse than we’ve ever seen it,’
says Don Briggs, president of the trade
group Louisiana Oil & Gas Association,
when asked about the state of the state’s
offshore Gulf of Mexico industry. Indeed,
the numbers are telling: according to
Baker Hughes, an average 27 rigs were
working offshore Louisiana in the first
half of September 2009. ‘It hasn’t been that
low since the 1940s,’ he says. ‘When you
stop and think that we used to have 170
rigs running out there – I’ve never seen it
this low.’
Onshore gas plays, among other
factors, have helped hasten the exodus
of shallow-water drilling rigs from the
Louisiana Gulf of Mexico, a trend already
well in place before oil and gas prices
plummeted last year. ‘The real excitement
in Louisiana is onshore,’ says Eric Smith, A view of Port Fourchon’s E-Slip, foreground, and its latest extension, the 7000ft slip B.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 53

LOUISIANA LOOKOUT
‘We will definitely be a player in the
development of the Eastern Gulf.’
Don Briggs
Venice vision
Venice, like other Louisiana coastal
ports, has become something of a
supporting player to Port Fourchon, the
lead in the Gulf of Mexico’s deepwater
E&P support system. But Venice, near
the mouth of the Mississippi River leave Louisiana with a diminished role strikes me that you’re not going to get
75 miles southeast of New Orleans, is in offshore. ‘When the [oil] companies a lot of the early-bird money going into
betting that new activity in the Eastern consolidate, they tend to consolidate in places like Pascagoula (Mississippi)
Gulf of Mexico will be its shot at a big Houston,’ he says. ‘So every recession, or Mobile (Alabama) or Panama City
part. we’re a little poorer for it. Even after (Florida),’ he says, ticking off a few port
The Venice Port Complex has the recovery, we end up having lost cities that would be closer to the action
dedicated more than $50 million to four or five companies. We’ve got but lack Louisiana’s long ties to offshore
infrastructure improvements since virtually nothing in the way of oil & gas oil & gas. ‘I think you’re going to see those
hurricane Katrina blew through the companies left.’ The state does have some big investments concentrated in places
Mississippi Delta in 2005, including healthy service companies that remain like Venice, maybe Morgan City and Port
a 5ft elevation of the road that serves headquartered in Louisiana, Smith says. Fourchon.’ The drilling may take place
port tenants, upgraded bulkheads ‘But they also have established pretty offshore Florida, he says, but ‘the labor’s
and the deepening of a pair of canals. strong offices in Houston as well.’ going to be coming from here, the service
Additionally, the port is petitioning the Louisiana does have one deepwater companies are going to be coming from
federal government to authorize the ace up its sleeve, however: proximity. here, some of the supply bases are going
deepening of a Mississippi River-to-Gulf ‘We’re close,’ says Smith. ‘And all of this to be here.’
waterway, known as Baptiste Collette, stuff is heavy. So close and heavy usually Briggs agrees: ‘Louisiana won’t benefit
from 14ft to 26ft to allow port access for mean proximity, and indeed that’s from wells drilled in the Eastern Gulf
larger vessels. Louisiana has kicked in what you see here.’ Port Fourchon, the of Mexico by sharing revenues; Florida
$3 million for a feasibility study to be deepwater Gulf of Mexico’s main support gets those,’ he says. But ‘they will use
completed next year, says Venice Port base, ‘is going great guns,’ he says. And Louisiana’s pipeline infrastructure,
Complex VP and general counsel George the state is positioning itself to capture they will use our people from Louisiana
Pivach. an even greater share of the market as service companies – we will definitely
Driving the renewed activity is E&P activity moves into the waters of be a player in the development of the
the promise of offshore E&P in the the Eastern Gulf of Mexico. Some of that Eastern Gulf’.
previously off-limits Eastern Gulf activity could be in shallower waters Louisiana has evolved, says Smith,
of Mexico. ‘Once Baptiste Collette is offshore Florida, where many legislators, from the center of the US offshore
dredged to a depth of 26ft, then Venice eyeing oil & gas royalties as a way to industry to a base of operations, with
will be the shortest distance to the combat serious budget deficits, appear on decisions being made elsewhere. But oil
Eastern Gulf for deepwater activity,’ the verge of lifting longstanding bans on & gas jobs still form a large share of the
Pivach says. ‘We are positioning drilling near the state’s popular beaches. state’s workforce, and that will be the
ourselves to be the port of preference for If it happens, Louisiana’s ports stand to case as the industry emerges from the
the Eastern Gulf of Mexico.’ gain, says David Dismukes, associate current downturn. ‘They’re some of the
Granted, there are cities along executive director at Louisiana State best jobs the state has, and they’re trying
Florida’s Gulf Coast that can boast University’s Center for Energy Studies. to hold on to every one of them they
even better proximity. But Venice has Dismukes has been working with the can,’ he says. And although companies
another advantage, Pivach says: a long Venice Port Complex, located near the continue to shift operations out of the
history with the industry, and a number mouth of the Mississippi River, to garner state, Louisiana’s geographic position
of service and support companies federal help in expanding the port’s will ensure that it remains a big player
already in the area. ‘We’re an oil & gas capacity in anticipation drilling in the in the offshore oil & gas arena. ‘You
town, so we don’t have the problem a lot Eastern Gulf of Mexico (see sidebar). don’t see the major headquarters being
of other places would, trying to figure ‘We’re explaining the value of the port expanded here,’ Smith says. ‘But the fact
out if they want to be in this business or to existing production in state and federal of the matter is, most of the deepwater
not,’ he says. waters, but also looking forward to what oil and gas is south of New Orleans, not
it could mean for the moratoria area,’ south of Houston.’ OE
Dismukes says, referring to legislative
action last year that lifted a decades-old
ban on expanded offshore E&P. ‘And it
looks like Venice and Louisiana are very
well situated to take advantage of those
opportunities, if they arise, for a variety
of reasons. If you think about workforce
development challenges, and labor force
and infrastructure investment, and the
capital that requires – in the early days
of that Eastern Gulf development, it just

54 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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OE_M_4_NP_Delmar_HPH.indd 1 28/9/09 15:12:45

OE_M_4_Page55.indd 1 29/9/09 14:34:46

LOUISIANA LOOKOUT
While the market meltdown has taken a toll ‘I’m a Texan. I grew up in Galveston and
on Louisiana’s oil & gas industry, many lived in Houston. But I decided to start the
companies with deep Louisiana roots remain company in Louisiana, and I grew roots
committed to the state and are finding ways to
weather the downturn and position themselves
here. The quality of life I have here, I couldn’t
for an eventual rebound. Russell McCulley duplicate anywhere else.’
gets a closer look at three organizations that Todd Hornbeck
are toughing it out on the bayou.

Offshore scion goes deep

back in 1997, when he started up the
company with $1 million in seed capital,
a tug and a handful of barges. The
company’s fleet now numbers more than
odd Hornbeck’s fate may have been to become one of the world’s largest OSV 80 vessels, and in 4Q 2007 Hornbeck’s

T sealed from the start: he was born

into a coastal Texas family that
operated a fleet of fishing boats and
companies. As Hornbeck says, ‘I grew up
in the marine business.’
Today, Hornbeck Offshore Services –
quarterly revenues reached the
$100 million mark. That year, the
company launched additional growth
a seafood processing plant, son of the the family retained rights to the name initiatives – including its acquisition of
founder of the original Hornbeck Offshore after the Tidewater merger – is making the Sea Mar Fleet in August 2007 – that
Services, which between its start in 1981 good on a gamble Hornbeck, president, resulted in an aggregate a $1.2 billion
to its 1996 acquisition by Tidewater grew CEO and chairman, made on deepwater expansion program.
In 2008, Hornbeck Offshore took
delivery on the first of four new
multipurpose support vessels to be
acquired under the program: a 430ft,
DP-3 Merwede T-22 class MPSV dubbed
the HOS Achiever, which is on site at
Shell’s Perdido development in the Gulf
of Mexico through the end of 2009. A
sister vessel, HOS Iron Horse, is expected
to be placed into service 4Q 2009. In
March 2009, Hornbeck Offshore also took
delivery of HOS Centerline, a 370-class
MPSV that Hornbeck says is the largest
OSV in the world; a second 370, the
HOS Strongline, will be delivered 4Q 2009.
Including the four MPSVs, Hornbeck’s
upstream fleet comprises 46 existing and
HOS Centerline, one of Hornbeck’s two 370ft DP2 newbuilds, went into service in March. nine pending vessels (the company also
owns and operates a fleet of ocean-going
tugs and tank barges, which generate
about 5% of the company’s cash flow).
The OSV fleet includes 21 200-class
vessels, 16 of which were picked up
through acquisitions; a 240-class fleet of
18 existing and seven pending vessels;
and five 270-class vessels. The company
also owns six work class ROVs.
Hornbeck estimates that the
company’s fleet represents 17% of
the total deadweight capacity of new
generation OSVs in the Gulf. ‘We’re
following the deepwater production
in the Gulf of Mexico,’ he says. As
deepwater exploration began to take off
in the 1990s, he says, ‘a lot of people were
hesitant to invest a great deal of capital
in an industry in its infancy. That gave
Hornbeck Offshore an opportunity to
enter that space.
‘Our whole plan,’ he continues, ‘was to
get scale, do it as quickly as possible, and
position ourselves to be able to weather
HOS Iron Horse, the second of Hornbeck’s two 430ft DP3 T-22 MPSV newbuilds, was the cycles.’
delivered earlier this year. Hornbeck says the strategy has been

56 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 LOUISIANA LOOKOUT
well tested. ‘We proved early on that our ‘Every stick of pipe for Perdido flowlines
business model would work in a down
market like we have today,’ he says. 1999 and pipelines came through New Iberia.’
was ‘one of the worst drilling markets in David Boulet
history. But we did 114 spot contracts on
an average of four boats, for 28 different
clients that year, which built the resume
of not only the equipment, but also the
back office.’
Hornbeck is counting on lessons
learned over the company’s 12-year
history to help navigate the current
downturn, even as the four newbuild rated for 9600ft water depths and a 10in
MPSVs come into service. ‘It’s a little
different with these MPSVs,’ he says.
‘We’ve got a strong balance sheet, we’re
Going with fusion bond epoxy (FBE) internally
coated water injection line.
‘Because of our logistics capabilities,
well established, and we have a proven
record of safety and efficiency. We’re
bringing these MPSVs to a soft market,
but with that reputation intact.’
the flow
he walls in the Port of Iberia
we were able to handle the entire project
here,’ David Boulet, director of business
services, says of the 280-acre Port of Iberia
yard. ‘Every stick of pipe for Perdido
Over time, he says, Hornbeck expects
to get average day rates of $80,000 to
$100,000 ‘blended among all four vessels’.
T offices of The Bayou Companies
sport renderings of some of the
more notable deepwater Gulf of Mexico
flowlines and pipelines came through
New Iberia,’ including 187 miles of 18in
pipe subcontracted to Williams. ‘That’s
The 430 stationed at Perdido is contracted projects the company has been involved our forte: handling large volumes of pipe
at the high end of that range, he says, in, including BP’s Atlantis, for which efficiently.’
while HOS Centerline is currently the company loaded out 240,000ft of 10in Huge volumes of pipe have moved in
operating out of Port Fourchon doing and 16in double jointed polyurethane and out of the Port of Iberia yard since
‘spot work’ in the $60,000 to $70,000 foam insulated pipe-in-pipe, among other 1972, when The Bayou Companies, then
range. ‘With the gas market in a slump products, in 2006. 30 years old and known as Bayou Well
and the financial markets still largely There’s a poster for the Independence Works and Bayou Welding Works, shifted
frozen, demand is down,’ he says. ‘But Hub, operated by Anadarko, and much of its focus to pipe coating.
I think the fundamentals of deepwater the Enterprise-operated export line The pace picked up in recent
are going to be there over the long haul. Independence Trail, where Bayou years, as deepwater exploration and
I can see these vessels in a hot market Companies processed 722,430ft of 24in production in the Gulf of Mexico gained
going for $150,000 to $200,000 a day.’ In the pipe, 11,240ft of 20in SCR pipe, and steam. The company now includes
meantime, he says, the 370s will stay close nearly 1.1 million feet of 6in, 8in and 10in four major affiliates: Bayou Flow
to port, ‘doing spot work while the market flowline. A more recent one portrays Technologies (BFT), a partnership
is down, building their resumes’ and Shell’s Perdido development, for which between Cuming Corporation, Perma-
waiting for the market to improve. ‘As the company delivered 14 PLETS, double Pipe and The Bayou Companies created
the deepwater infrastructure builds out, jointed, 8in and 10in flowlines with 3in of to cater to the deepwater insulation
those vessels will be part of it.’ glass syntactic polyurethane insulation market; Commercial Coating Services
Despite the current market troubles,
Hornbeck says the outlook shows growing
demand and tighter supply for deepwater
OSVs in the Gulf of Mexico – which is
where, given a choice, he prefers to work.
‘I’d like the 370s to stay in the Gulf, but
it will depend on contracts.’ So far, the
company has largely managed to avoid
work in some of the higher-risk areas of
the world, but ‘we are a global company’,
he says. ‘As our fleet grows and we grow,
it becomes more of a challenge to stay
in the Gulf. We work internationally
now, but I predict that over the next five
years, we will be putting more of our fleet
in international waters, particularly in
Latin America.’
The company’s headquarters, however,
will stay put. Hornbeck’s offices and
200-person staff are in Covington,
Louisiana, on Lake Pontchartrain north
of New Orleans. ‘I’m a Texan. I grew
up in Galveston and lived in Houston.
But I decided to start the company in
Louisiana, and I grew roots here. The
quality of life I have here, I couldn’t
duplicate anywhere else.’ OE PLETs being loaded out by The Bayou Companies for Shell’s Perdido development.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 57

LOUISIANA LOOKOUT
International, a custom coating firm Historically, Boulet says, the bulk
based in Conroe, Texas, that has several of the company’s work has come from
domestic locations and has provided offshore projects, although over the past
services internationally; Bayou Coating, few years onshore natural gas and liquid
a collaboration between The Bayou projects have formed an increasing share
Companies and Stupp Brothers formed to of the business. ‘The balance has shifted
provide coating for Stupp’s ERW pipe mill somewhat over past few years, with the
along with their new spiral pipe mill in onset of large onshore plays,’ he says.
Baton Rouge; and Bayou Welding Works, With deepwater production in the
which was dissolved in the mid-1980s Gulf of Mexico ramping up, offshore
but revived in 2006 ‘to tackle the welding still commands much of the company’s
challenges in the industry,’ Boulet says. attention, and presents some big
The majority of Bayou’s work is in challenges. ‘The environments are getting
FBE, which is applied in powder form on harsher – there’s more hydrostatic
a cleaned and heated pipe; the coating is pressure on pipe, as well as insulation,’
electrostatically applied onto the pipe, Boulet says. ‘With ultra-deepwater wells,
producing a controlled-thickness coating. you’re drilling 25,000 to 35,000ft below
The Port of Iberia complex alone has eight the mudline. These pipelines have to
separate coating plants; the most recent, handle higher temperatures and higher
built in 2007, can accommodate 80ft pressure.’ Boulet says the company is
sections of pipe. The new coating facility, currently developing higher-temperature
Boulet says during a tour, was built to coatings, testing some at temperatures
incorporate advanced safety features and between 250°F and 300°F. ‘And we’re
the latest coating technology, including applying the latest welding technologies,’
electric heat induction equipment. The he says, including higher alloy, lower
coating plants at the Port of Iberia can carbon steels, corrosion resistant steel
handle pipe up to 48in diameter; for pipe and stainless.
up to 60in, the company uses the Baton A privately-held family company since
Rouge facility. it was founded in 1942 by Ed Shea, who
Bayou also includes a pipe bending started out with a single welding truck,
facility and does a brisk business in The Bayou Companies was acquired in
concrete coating, which adds heft to early 2009 by Chesterfield, Missouri-based
pipelines and keeps them submerged Insituform Technologies. Boulet says
and in place in water. The company also the new ownership could help Bayou
applies ID coatings to the interior of pipes continue to grow once market conditions
to improve flow and prevent corrosion. improve.
The conglomeration of companies ‘We now have a strong financial
means Bayou can perform a range of partner giving us greater access to
‘value-added services’ in one yard, capital and the ability to go after new
Boulet says, without the considerable opportunities,’ he says. ‘There are a lot
expense of shipping pipe among different of large deepwater projects coming up, No dummy: A trainee
locations. ‘We can barge pipe in, multi- and pipe is a significant percent of their at the Superior Energy
join, corrosion-coat, insulate and load it budgets. So we’re hoping that 2010 and Services Career
out via barge, rail or truck without it ever 2011 will be robust for the offshore market Training Center
leaving the yard,’ he says. and The Bayou Companies.’ OE learns the ropes on the
company’s 30ft tower.

All hands
on deck
t takes a stretch of the imagination

I to picture the dusty ground outside

Superior Energy Services’ Harvey,
Louisiana, Career Training Center as
anything but, well, dusty ground. But
operations manager Joe Parks insists
otherwise. ‘We’re surrounded by water,’
says, opening the gate that encloses a
he says
partial replica of a 200-series liftboat.
The metal deck, afloat in an imaginary
Flowlines in Bayou Companies’ Port of Iberia yard last year, headed for Shell Perdido. sea, is also home, briefly, for many of the

58 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 LOUISIANA LOOKOUT
‘The offshore life can be a
tough one. Once in a blue
moon we get someone who’s
just not cut out for it.’
Joe Parks

CCareer
Ca Training Center (CTC) students
areer Trainin trainees were scaling the tower as an
wwho pass
ho pa through that gate: a simulation
ass throu instructor looked on, offering suggestions
what
off w ha offshore will be like for
at life offs and critiques. Trainees learn at least
those
tho
th ose wwhoho have never experienced it. ‘A seven different rescue techniques, Parks
bbig part of it is learning to live in close
ig pa explains, to cope with different situations
quarters,’
quuarrters,’ says Parks, indicating the and the various equipment and climbing
ddouble-stacked
oub ble-stacked bunks and common areas methods employed by contractors.
in the
n th
he mock lift liftboat’s living quarters. Superior invested about $5.6 million
‘This
‘TThis space is pretty much all they
is little spac in the deck replica, which includes a 70ft
have
ha avee while theythey’re out there.’ crane for overhead crane training and an
Granted,
G anted, it’s much nicer and more
ra inactive well drilled to 30,000ft. Initially,
spacious
spa
sp acioous than tthe typical offshore Superior created the CTC program for
accommodations
acccoomm modation of a generation ago, employees of the group’s nearly two dozen
wwhen
henn tthe bunks might have been
he bunk divisions. But the program was quickly
sstacked
ta
ackked ffour-high
our-hi instead of two. But the broken out into a business division,
simulated
siimula lated experience still weeds out a
d expe and opened its training programs to
few
wp people
eoplple wh who don’t have what it takes employees of non-competing clients
survive
to suurviive w weeks at a time on a rig. and contractors. Requests have come in
‘Once
‘On nce iinnab blue moon we get someone from non-oilfield entities, including law
who’s
w ho’ss just not cut out for it,’ Parks enforcement, and for unusual classes,
says.
says s. ‘The offshore life can be a such as defensive driving instruction.
tough
tou
ough on one’.
ne’. ‘Seventeen different companies signed
Although
Alth
though tod today’s offshore environment on in the first year, probably 95% of them
far less risky than it once was, it can
iss fa offshore,’ Parks says. Today, says Colbert,
dangerous place if workers don’t
still be a dange outside companies make up about 10% of
adhere to safety standards. And that’s the volume.
primary goal fo for CTC trainers: to instill Matt Hallinan, Superior’s VP of
proper safety p practices in its students, corporate QHSE and training, says
and to teach the them how to detect problems in-house training helps new hires
before someone gets hurt. ‘I always say become acculturated to the organization
tragedy is the accident itself,’
the first traged and builds loyalty. ‘As a major oilfield
Parks says. ‘Th ‘The second tragedy is the contractor, there are advantages to doing
person who cou could have said something to [training] in-house for our own employees
prevent it, but d didn’t.’ and affiliated companies,’ he says. ‘We
Offshore is ju just one element in the can control the quality. We can hone and
training progra
programs at Superior’s Harvey customize our methods.
and New IberiaIberia, Louisiana training ‘When we have a new employee
centers, which offer instruction for a coming in, we have their full attention
range of rig and support operations, for five days. They get an immersion in
hands-on swing rope and personnel Superior’s culture, methods and safety
training, confined space rescue,
basket training measures. I think it instills a sense of
instruction and rigger training,
first aid instruc loyalty to the company.’
to name just a ffew. But the program, The CTC provides continuing
launched in 200 2001, may be best known education courses that are mandated
prevention training, which
for its fall preve for the industry, such as the Petroleum
involves a 30ft ttower equipped with Education Council’s SafeGulf and
harnesses and other equipment
ladders, harnes SafeLandUSA programs. And the
found on a vari variety of drilling platforms. company participates in a state initiative,
‘There’s a satursaturation of training services the Incumbent Worker Training Program,
in the Lafayette area,’ says CTC corporate which offers Louisiana employers grants
director Spencer Colbert. ‘The
training directo to use for skill development courses for
fall tower is wh what sets us apart from our current employees. Although oilfield
peers.’’
peers safety is the first concern, Parks says,
Parks calls fall prevention training ‘we’re not just doing this work for the
the ‘bread and butter’ of CTC’s courses. safety aspect. We’re building futures for
One day in late summer, about a dozen these guys.’ OE

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 59

OE_M_4_Nylacast.indd 1
MEXICO
Naranjos Gusher #1 with man
carrying oil can.
Date, photographer unknown.
DEGOLYER COLLECTION, DALLAS

An anonymous photo from around 1920

shows a boat party in Tampico, where
the expat community mushroomed
during Mexico’s first oil rush.

Dawn of an era, in focus

A traveling exhibit of historical photos, culled from private collections and
rescued from dusty archives, depicts the genesis of Mexico’s oil industry along the
Gulf of Mexico coast. Russell McCulley talks to the show’s curator about the
images, the stories they tell, and his ongoing effort to expand the collection.
mid the hubbub on the exhibition 1920, an international group of revelers, Mexico’s Oil Industry, 1892-1938’ don’t

A floor at Aberdeen’s Offshore Europe

conference last month – the thousands
of delegates, booths touting the latest
flush with oil money, crowd onto a barge.
Oil’s effect on regional Mexican society
was immense, Bracamontes says. ‘In
specifically address the issue. Instead,
Bracamontes says, ‘I’ve tried to give a
very good cross-section of the social life,
in oilfield hardware and software – the less than 20 years, Tampico became a the technology, during a specific time. I’m
expansive collection of photographs in real metropolis,’ he says, gesturing to not trying to make a political statement.
‘The Birth of Mexico’s Oil Industry, 1892- the party photo. ‘You could write a story I’m interested in beautiful, descriptive
1938’ provided a respite, and an interesting about each of these characters – people pictures. And this is a descriptive exhibit
contrast with the 21st century technology who were risking all their fortunes there, that is very dear to me.’
on display elsewhere. In one photo, a people who came as employees, people The years of research have intensified
worker, back turned to the camera, has an from all over the world.’ that feeling, he says. ‘When you read
oil can slung over one shoulder, the most The photos betray few signs of the the stories and you dig more into what
basic form of oil transport, as a well gushes revolutionary fervor that swept the was going on, you really admire these
before him. In another, several roughnecks rest of the nation early in the century; individuals, who came from all streams of
struggle with a drilling pipe, hands-on – a the oil region was somewhat isolated, life and took enormous risks.’
sight bound to make a modern HSE officer Bracamontes says, and companies hired A selection of images from ‘The Birth
gasp. guards to keep watch over assets. And of Mexico’s Oil Industry, 1892-1938’ will
But such was life in the early days of the collection ends abruptly at 1938, the be on view 12-16 October at the Houston
Mexico’s oil industry, an era captured year Mexico nationalized the industry; Museum of Natural Science during the
in the photographs curator Marco Bracamontes has thus far had little Texas Land Office’s US-Mexico XVI
Bracamontes has been researching and success convincing Pemex to open its Border Energy Forum, and Bracamontes
assembling for several years. Aberdeen photo archives. is arranging shows in London and other
marked the eighth time Bracamontes has The exhibit has a connection to each European cities. OE
mounted the show, which has expanded city it has traveled to so far, he says. For
since its debut in Houston in 2004. Aberdeen, the connection is Weetman
‘This is an ongoing project, and Pearson, the British-born industrialist
the beauty of it is that it has grown who, in 1889, was invited by Mexican
and broadened in subject matter president Porfirio Diaz to construct a
and scope,’ he says. Bracamontes, railroad from the Atlantic to the Pacific.
who has a background in media and During construction, Pearson’s crew
communications, says his aim is to discovered the Portrero del Llano oilfield,
educate people on the early years of and Pearson subsequently founded the
the oil & gas industry and Mexico’s Mexican Eagle Petroleum Company. Late
significant role in it. ‘I’m not a historian; in life, he acquired property in Scotland
I’m not an engineer,’ he says. ‘I’m a and became rector at the University of
communicator. And what I’d like is for Aberdeen.
people to learn more about the history of Bracamontes has received some
our industry.’ financial support from industry for the
It’s a history characterized by struggle, project, and much help from ‘collectors
adventure, risks and vast rewards. of various sort: academic, institutional,
Mexico’s oil industry began along the corporate and private’, he says. ‘I am very
Gulf of Mexico coastal states of Veracruz grateful to all who have been willing to
and Tamaulipas, which came to be known show their work instead of letting it sit in
as the Faja de Oro, or ‘Golden Lane’. One a box in an archive somewhere.’
photo depicts Tampico in the early 1890s It’s difficult to think of oil in Mexico
as a quiet trading village, with small without considering its role in Mexican
boats laden with goods; in another, from politics. But the images in ‘The Birth of

60 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 MEXICO
Planning PECOM
A more modern appreciation of
Mexican oil & gas activity is available
at November’s Petroleum Exhibition
& Conference of Mexico (PECOM)
in Villahermosa. With over 5000
participants from 16 countries already
registered at press time, PECOM looks
like being a lively affair.
Organized by IEI in conjunction
with Pemex and IMP, the event, aimed
Group of workers for at helping companies do business
La Corona SA, a subsidiary in Mexico’s oil sector both on- and
of Royal Dutch Shell, in offshore, kicks off at 18.30 on Tuesday
Tampico, taken in 1925 17 November with the formal ribbon
by an unknown photographer. cutting and VIP tour.
PRIVATE COLLECTION, HOUSTON An early conference highlight next
day is the breakfast session (09.00-10.00)
at which Alejandro Lopez Velarde
of Wilson Abogados will discuss
implementation of Mexico’s oil and gas
reforms. The exhibition opening hours
on 18 November are 10.00-20.30 and on
19 November 10.00-19.30. A strong and
varied technical program is promised.
The range of topics on the Wednesday
includes drill pipe riser connector
repair, water control in the Ku field,
central Mexico’s cretaceous challenge,
flowline pipe-in-pipe systems,
Drilling in Tamiahua micro-flux control, subsalt imaging,
Lagoon, view from top borehole image interpretation, managed
of derrick. Taken by pressure drilling, and the evaluation of
Robert Batt, c.1920. petrophysics during drilling. Also that
HALE COLLECTION, HOUSTON day Halliburton’s Jorge Castro and Luis
Solis will present a case history on how
the first application of a heat activated
Drilling in rigid rapid fluid system in the Mexican
Tamiahua Lagoon. deepwater environment helped cure
Taken by Robert Batt, severe loss of circulation.
c.1920. Conference topics on the Thursday
HALE COLLECTION, include advanced finite element
HOUSTON analysis, crane safety, subsea
services, MPD using concentric casing
nitrogen injection, subsea control and
monitoring, premium connection rods
for very high loads and petroleum
data unification. Juan Manuel Riano
of Pemex discusses the application of
integral well productivity analysis, while
Schlumberger’s Jose Betancourt looks at
proactive geosteering in Mexican fields
and Jesus Contreras of Baker Hughes
describes possible new ECP applications.
PECOM technical advisory board
members include Aker’s Alan Cordy,
Brent Emerson of Baker Hughes, BJ’s
Sergio Centurion, John Bousa of Deep
Marine Technology, Halliburton’s Hector
Benito Ramierz Snr; Dr Heber Cinco
Ley, IMP; InterMoor’s Brent Boyce, Bob
Curtis from Subsea 7’s i-Tech division;
Dr Paul Jukes of JP Kenny; Cesar A
David Montes and Hector Y Gomez from
Pemex, Seal-Tite’s Vernon Chagnard and
technical advisor Miguel Machado.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 61

OE_M_4_NP_IPS_FP.indd 1 29/9/09 07:57:30
 PIPELINE TECHNOLOGY
The system
software is flexible
and user friendly.

Laser sensors keep pace

making for ultra-reliable, noise-free data
transmission and enabling a fully digital
pipeline welding system (Figure 1).

with higher weld speeds Applications

Weld joint tracking. The nature of
narrow gap welding in pipelines makes
Laser vision sensors capable of reconciling today’s higher pipe welding speeds with it impossible to have precise alignment
around the joint circumference due
enhanced weld quality requirements should be on the market early next year courtesy to variations in joint fit up as a result
of leading pipeline welding specialist CRC-Evans. Here, the company’s engineering of tolerances in pipe diameter and
vice president Shankar Rajagopalan discusses the thinking behind these new ovality. This leads to local changes in
joint geometry and position. The Smart
‘smart’ sensors and their potential for global deployment. Laser Sensor measures these changes
ontinually seeking to increase it had serious limitations regarding in real time during welding. Tracking

C welding speeds while

simultaneously improving weld
quality assurance, CRC-Evans developed
unit cost, robustness, ease of use and
suitability for the typical pipeline
right-of-way conditions. These made it
data is sent via high speed digital
communication to the precise motion
control system built on to the CRC Evans
narrow gap welding technology that unsuitable for general use with external welding system. This closed
can deposit fill and cap passes at travel CRC-Evans’ large external welder fleet. loop control ensures that the welding
speeds in excess of 1m/min. However, Since temperature and environment electrodes are always where they should
such high welding speeds threaten the conditions are not conducive for an off- be to achieve good results.
limits of conventional through-arc seam the-shelf vision system, a new generation The exact nature of the tracking
tracking. The company also identified of laser vision sensors was needed to algorithms varies with the type of weld
that the overall pipe joining process could overcome the problems noted above and pass. For example, during root welds,
be dramatically improved if additional facilitate widespread use in the pipeline the laser vision system provides for
information about weld preps and joints industry. a very accurate tracking without the
could be obtained before, during and after need to oscillate that is a requirement of
welding. Smart thinking through-the-arc tracking. This results
Research using an off-the-shelf laser In partnership with Meta Vision Systems, in more accurate bead placement and
tracking system showed that joint CRC-Evans came up with CiRCVision, a better penetration. Experimental studies
tracking at speeds in excess of 2m/min robust new vision system well adapted to have shown that the high resolution of
was possible. Furthermore, such a sensor the needs of the general pipeline industry the laser sensor makes it possible to use
system could provide information: before while still being very affordable. This has laser tracking for all stages of the welding
welding, such as bevel profiles; during been achieved by exploiting the latest process, including cap pass. > overleaf
welding, such as joint parameters, hilo developments in electronics to put the
(mismatch), width, root gap, etc; and after image processing electronics inside the
welding such as weld bead profiles. All laser sensor head itself, thereby creating
of this information, when combined with a Smart Laser Sensor.
advanced control and reporting systems, The design consists of a robust CMOS
is directly relevant to improving weld Megapixel camera with very large scale
speed and quality. integration devices, including a large
Although ‘off the shelf’ laser tracking FPGA and a powerful DSP. The vision
was technically capable of providing system has a field of view of 50mm,
seam tracking at the required speed, horizontal pixel resolution of 0.05mm and
vertical pixel resolution of 0.07mm. The
About the author self-contained package has no moving
Shankar Rajagopalan is VP new parts and can acquire and process
product development at CRC-Evans 30 full 1280x1024 frames per second.
Automatic Welding in Houston, where The sensor itself is fully digital and
his work experience includes 20 years of designed for easy integration within
embedded system and automation control digital control and communication
development. He holds a MSc in electronics from India’s systems, with both high-speed Ethernet
Bombay University and a MSc in physics from Creighton and CAN bus interfaces. These external
University in the US. links provide the digital-to-digital Figure 1: Smart Laser Sensor mounted on
interface to the CRC welding system the CRC-Evans Bug.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 63

PIPELINE TECHNOLOGY
Figure 3 (left):
Laser sensor for
internal root
inspection, large
pipes.

Figure 4 (below):
Laser sensor
mounted for root
inspection, small
pipes.
Figure 2: Laser sensor mounted for bevel
inspection.

Adaptive welding. Adaptive welding This immediately identifies any bevel

refers to the capability of the welding problems while the beveling machine
system to change key welding parameters is still in position, enabling rapid
in real time in response to measured rectification of any problems.
changes in the weld joint profile. The All the features of a bevel design (see
variation in fit up mentioned above diagram below left), such as root face
results in volumetric changes in the weld (land) thickness, bevel angle, offset, and
joint around the circumference of the root angle, can be obtained and compared weld at this point will be much more time
pipe. Since the laser sensor works in 3D, against the desired template. In this way, efficient.
effectively taking slices through the weld the system detects and eliminates any Inspecting the shape of the root weld by
joint, it is able to compute accurately the issues right at the point of beveling and laser vision also provides a supplemental
remaining weld volume. hence provides a good foundation for the way of inspecting the root pass on
This information is passed to the welding process. critical fatigue applications such as
CRC-Evans external welding controller Root bead inspection. It is well known risers. Measuring weld shape parameters
which then makes the necessary that the root weld is the most critical such as mismatch, bead concavity, and
adjustments to the travel speed, wire feed phase of the entire welding operation. the re-entrant angle provides a level of
speed and oscillation width to achieve a Currently root beads can be deposited in confidence in the completed product
constant percentage fill around the pipe one of three ways: by using the previously unattained through AUT
circumference. This function eliminates CRC-Evans external welding systems, inspection.
the need for the operator to make real which makes use of a copper backup User interface. The system has a flexible
time adjustments. Adaptive fill also clamp; by using the Cold Metal Transfer user interface for all the above mentioned
has the potential to eliminate the need process, or by using the CRC-Evans high applications. All the measurements can
for a strip pass in certain situations speed internal welder. be displayed in metric, English or in pixel
where the wall thickness does not fit the Detection and correction of root units.
conventional ligament thickness for a bead defects in the first station can
given weld pass. significantly save time and money (to Schedule
The combination of accurate seam the end user) by not waiting till the The smart sensor is now in the final
tracking appropriate for the pass being (UT) inspection is done. Performing production prototype stage with field
welded and adaptive fill based on actual the inspection after the entire weld testing scheduled for calendar fourth
measured joint volumes makes it possible is complete can be very costly should quarter 2009. The official launch of
to achieve consistent high quality welds there be root bead defects. In an offshore the system took place in September at
at higher speeds than would otherwise be environment for large diameter pipes the prestigious Essen welding, held in
possible. (Figure 3), once the root is deposited a Germany every four years.
Bevel inspection QA/QC. One of the scan with the vision system gives an The Smart Laser Sensor will be
keys to efficient pipeline welding is for accurate evaluation of the root profile and available for general use starting January
the line crew to be able to bevel pipe ends provides the opportunity to make repairs 2010. OE
consistently, accurately and quickly in the root station.
even in the face of variations in pipe end The same applies to a spool base or lay
diameter and ovality. barge for small diameter pipes where
Since the Smart Laser Sensor is a human inspector cannot access the
basically an instrument for measuring weld joint area (Figure 4). On projects
3D profiles, it can also be used to where zero tolerance for root defects are
inspect bevel geometry immediately allowed, preventing potential cut outs
after the beveling operation (Figure 2). from reaching the NDE station can guard
Good root bead.

against significant downtime. Laser

vision systems can prevent suspect root
Undercut.

passes from reaching the NDE station and

Porosity.

limit downtime risk.

The smart vision system can inspect
the internal profile of the root pass in
the first station and determine if an The three images above show raw
acceptable root profile has been achieved laser sensor data representing two
immediately. In cases where the root is fault conditions with a good weld for
not acceptable, repair or replacing the comparison.

64 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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PIPELINE TECHNOLOGY

Meeting the deepwater challenge

Pipelines have progressed into ever
deeper waters over the last four decades.
Martin Connelly, technical manager
of Corus Tubes Energy Business,
discusses some of the technological
advances in pipeline manufacture and
design that have helped reinforce the
financial and technical feasibility of
deepwater developments worldwide.

onventional pipeline design,

C although concerned with many

factors, is generally dominated
by the need to withstand the internal
pressure in the line. The higher the
pressure that products can be passed
down the line, the higher the flow
rate and greater the revenue potential
for the operator. However, when
discussing the factors that are critical
for deepwater pipelines the challenge
becomes dominated by resisting the
external pressure, particularly during the
installation phase.
Deepwater trunklines and long distance
tiebacks present the greatest challenge.
To increase subsea production these
lines tend to be larger in diameter and a
thicker pipe wall is required to ensure
the pipes can withstand the hydrostatic
pressure and bending as it is laid to the
seabed.
Typically these lines are often
16in to 20in outside diameter, which
presents a further complication as

About the author

Martin Connelly is responsible for
ensuring Corus Tubes linepipe can
meet the market’s increasingly difficult
technical demands, while also overseeing
the company’s new product and market
development. After graduating with a first class honours
degree in metallurgy and engineering material from
Strathclyde University, he joined the Corus Group in
1993 and served in a number of technical, quality and
operational roles before being promoted to technical
UOE DSAW linepipe has a proven track record for offshore deepwater projects worldwide, manager.
including Shell’s pioneering Perdido development in the Gulf of Mexico.

66 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 PIPELINE TECHNOLOGY
The strength of
Corus Tubes’
O-press ensures
that pipe size is
controlled to the
highest degree.

the pipe sizes lie at the top end of The finished pipe shape is determined has been able to determine a set of
economical production for seamless during the manufacturing process manufacturing conditions that enable
pipes. The seamless processes can and can be optimised by balancing collapse performance to be enhanced,
produce the thick walled pipe required the manufacturing parameters, pipe providing the potential for reducing
for these developments but often the compression and expansion. Corus Tubes’ pipe wall thickness for future deepwater
manufacturing process is slow and crimp, U-press and O-press combinations applications.
the cost of material high. The most ensure a high degree of control over
economical method of manufacture for pipe size, often beyond the limits Groundbreaking projects
these lines is the UOE process, but the detailed in most offshore specifications. The company has played a key role in
increasing demands of the industry drive The enhanced pipe ‘roundness’, wall a number of groundbreaking projects
the design towards the practical limits of thickness and diameter tolerance can which have pushed the boundaries of
manufacture and installation. assure designers of the manufacturing deepwater exploration and production
Recognising this market trend, quality of the pipe, removing uncertainty and enhanced understanding of pipeline
UK-based Corus Tubes built upon its in the design and production stages and capabilities and limitations.
extensive experience supplying pipe allowing the optimisation of the pipe wall In 2001, Corus Tubes supplied 94km
with high compressive strengths for thickness. (approximately 45,000t) of three layer
major North Sea trunklines to position polypropylene coated, high grade,
itself as a leading supplier of UOE double Material compressive strength sour service linepipe and bends for the
submerged arc welded (DSAW) linepipe Pipe manufactured by the UOE process technically challenging Bluestream
to the deepest pipelines in the world, and undergoes various strain cycles, both system which supplies gas from Russia
in the process has overcome significant tensile and compressive. The combination to Turkey under the Black Sea. The
challenges associated with pioneering of these cycles affects the overall company was one of three suppliers for
deepwater projects such as Bluestream behaviour of the material in compression. this project and, due to the excellent
and Perdido. This is indicated in the DNV equation by collapse resistant properties of its pipe,
The UOE process involves the the presence of the Fabrication Factor it was selected to be laid at the deepest
steel plate being pressed into a U and αfab. For standard UOE processes the section of the pipeline at 2150m.
then O shape and then is expanding term represents a de-rating of 15% in More recently the company supplied
circumferentially. The current wall the compressive strength as a result linepipe to the Perdido Norte project
thickness and diameter requirements of the material response to the strain in the Gulf of Mexico, one of the
for deepwater trunkline pipe continue to cycles during forming, known as the world’s deepest pipelines. Williams
prove challenging from the standpoint Bauschinger Effect. commissioned Corus’ expertise
of manufacturing economics and The relevance of this to pipe making in the production of 18in pipe and
installation capabilities. lies in the fact that during the forming approximately 312km of uncoated
Few producers are able to manufacture process the material is placed in steel linepipe was delivered for use in
UOE pipes at 16-20inOD; however this tension during the expansion process. water depths ranging from 3500ft-8300ft
manufacturing route can be quicker Following this, the material is despatched (1067m-2530m) with a rugged seabed
to market and more cost-effective than for installation where the pipe sees terrain. The pipe was manufactured to
seamless alternatives. The Corus Tubes compressive stress from the pressure withstand a service rating equivalent to
manufacturing process optimises the of the seawater. Conventionally a 15% ANSI 1500.
design of the material while minimising reduction in compressive strength One section of the pipeline transfers
the wall thickness of deepwater pipelines, is allowed for to compensate for the hydrocarbons from the FPS host in
cutting material and welding costs as Bauschinger effect. Alaminos Canyon 857 and terminates in
well as installation time, reducing pipe Since the early 1990s, Corus Tubes East Breaks block 994 (78 miles). The gas
weight for logistics and submerged pipe has observed that the results it obtained pipeline terminates at Williams Seahawk
weight considerations, and increasing from the forming process often yielded pipeline in East Breaks block 599 (106
design scope enabling a wider range of higher compressive strengths than miles). The 18in pipe was manufactured
deepwater developments. those obtained by applying the standard in wall thicknesses ranging from 19.1mm
Det Norske Veritas (DNV) has been equations. Since then a programme of to 27.0mm.
involved in deepwater pipelines since research and process development has Although testing the limits of
the quest began. The acceptability of a led to a greater understanding of the deepwater pipeline applications, the pipe
pipeline design for a given water depth mechanisms during pipe forming and it is was delivered and successfully installed
is determined by means of standard now possible to reverse this effect to one efficiently and effectively. Comprehensive
equations that measure the relationship yielding higher compressive strengths planning, communication and in-depth
between outside diameter, wall thickness, than would normally be expected. experience meant the parties worked well
pipe shape, and material compressive By optimising the various compression together to deliver a bespoke design for
strength. and expansion cycles the company the project. OE

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 67

OFFSHORE DATA
Offshore Engineer’s at-a-glance guide to Reserves in the Golden Triangle by water depth 2009-13
current offshore field and rig data is updated Water Field Liquid Gas
monthly using statistics supplied by data depth numbers reserves reserves
(mmbbl) (bcf)
analysts Infield Systems and premium rig
utilization rates provided by Rigzone.com Shallow 33 1278 5057

Brazil
Deep 20 3764 4092
Ultradeep 14 2520 1000

Note: Shallow 64 75 1058

USA
Shallow water <500m Deep 65 2945 5054
Quick stats guide Deep
Ultradeep
500-1500m
>1500m
Ultradeep

Shallow
26

175
3510

4560
3855

15,931

W Afr
New discoveries announced Deep 29 4769 7120
Worldwide and Gulf of Mexico rig market overview
Ultradeep 7 1020 760
Utilization for the worldwide mobile offshore drilling fleet has Depth
range 2006 2007 2008 2009 433 24,442 43,927
decreased by 12.8% from 88.9% in August 2008 to 76.1% as of
(last month) 429 23,937 43,737
this August. Worldwide jackup utilization stands at 72.1% which Shallow 180 154 129 60
is down 17.4% from a year ago. Deep 26 31 30 20
Jackup utilization in the Gulf of Mexico for both US and
Ultradeep 18 25 21 15 Production systems worldwide
Mexican waters is 52.8%. This number has decreased by 33% (operational and 2009 onwards)
Total 224 210 180 95
over the past year. Of the 105 jackups currently in US & Mexican Floaters: (last month)
waters, 53 are currently under contract. Twenty-four will roll off Operational 236
contract by the end of 2009 and 15 will come off contract by Greenfield reserves
2009-13 Under construction/conversion 35
the end of 2010. Of the 53 contracted rigs, 35 are contracted Planned/possible 221
Water Field Liquid Gas
to PEMEX with 10 coming off contract by the end of 2009 and depth numbers reserves reserves 492 (493)
another 12 with contracts ending in 2010. PEMEX has indicated (mmbbl) (bcf) Fixed platforms:
(last month) (last month)
that they may issue a tender for seven to eight jackups in 2009. Operational 9208
However, the tender has yet to be finalized. Shallow 1292 70,194 678,829 Under construction/conversion 128
(1301) (70,323) (690,193) Planned/possible 1472
Worldwide rig utilization 10,598 (10,780)
100% Deep 167 13,604 58,592
95% Semis (165) (13,256) (58,312) Subsea wells:
Jackup
90%
Semi Operational 3695
Ultradeep 53 7086 16,315 Under development 464
85% (51) (7020) (14,915)
Drillship Planned/possible 4402
80%
Jackup 1512 90,884 753,736 8561 (8530)
75%
70%
07/08

08/08

09/09

10/08

11/08

12/08

01/09

02/09

03/09

04/09

05/09

06/09

07/09

08/09

Global offshore reserves (mmboe) onstream by water depth

Gulf of Mexico rig utilization 2007 2008 2009 2010 2011 2012 2013
100%
Drillship Shallow water 7403.27 26,116.96 18,183.03 14,478.29 31,904.08 67,427.64 57,928.46
90% (last month) (7499.07) (26,138.66) (19,470.62) (15,118.08) (31,852.69) (52,458.36) (73,148.34)
80% Semi Deep 7315.97 3329.82 5595.44 3912.88 3146.61 4989.22 6257.42
70% (last month) (7315.97) (3329.82) (5580.44) (3982.97) (2987.00) (5419.89) (5533.98)
Jackup
60% Ultradeep 972.61 1494.42 1048.77 1341.57 472.26 2928.88 4118.48
(last month) (972.61) (1494.42) (1042.77) (1303.31) (497.52) (2682.13) (4068.48)
50%
07/08

08/08

09/08

10/08

11/08

12/08

01/09

02/09

03/09

04/09

05/09

06/09

07/09

08/09

Total 15,691.85 30,941.20 24,827.25 19,732.74 35,522.95 75,345.74 68,304.36

All reserves figures are proven plus probable.
SOURCES: Reserves and field data: Infield Systems, London (www.infield.com); Rig data: Rigzone, Houston (www.rigzone.com).

68 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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 PRODUCTS IN ACTION
Their solution was to fit tasking the ROV,’ explains
AX-S field trials powerful thrusters to each Saab Seaeye’s David Grant.
next summer TMS so they can hold position
while their ROV carries out its
‘Added to that, an auto-
heading feature constantly
Following field trials early task. aligns the opening of the TMS
next year, first application ‘The operator simply dials with the swimming position of
of Expro’s AX-S deepwater up a target heading and the ROV thereby orientating
riserless system is slated for magnitude of thrust, and the itself ready for recovery of the
a BP well in the North Sea in system automatically holds ROV to the TMS, and avoiding
July 2010. Gerry Rideout, the the unit steady, leaving the the risk of the ROV tether
company’s AX-S sales and operator to concentrate on running behind the TMS.’
marketing director, claims
For further information on companies the system, designed to work
and their products featured in this review, in 10,000ft of water, will cost
please go to about one-third the normal
www.offshore-engineer.com cost of deepwater intervention
with a rig. Additionally,
he says, it will save time
over a wire-through-water

products intervention system.

‘All the tools are located on

in action the seabed within the AX-S

system itself,’ Rideout points
out. The system has one line in
Cutting under the water, compared to some
systems that may require
pressure as many as nine or 10 lines,
Pressure control specialist
Boots & Coots has entered
adds Matthew Law, Expro’s
engineering manager for AX-S.
SmartPlug starts work on Sarawak lines
into an agreement to ‘We designed the system with TDW Offshore Services AS in Stavanger has entered into
purchase Halliburton’s a minimum of lines,’ he says. a frame agreement with Amserve Engineering to provide
external abrasive jet cutting To accomplish this, Expro a range of pipeline services on a call-out basis on behalf of
systems. The two companies looked to salvage experts Deep Sarawak Shell in Malaysia. The agreement calls for TDW
have worked together for Tek to provide the fibre rope to supply SmartPlug pipeline pressure isolation and hot
several years coordinating umbilical bundle, a fibre rope tapping services as required, in addition to subsea repair
deployment of the jet cutter with three small umbilicals clamps.
in domestic and international helically wrapped around it. Work will be carried out on Sarawak Shell’s facilities
emergency response Schilling Robotics provided in the South China Sea, offshore western Borneo. The
situations. the control system. facilities include Sarawak’s M3, B11, E11 RB, F23 and
Boots & Coots CEO Jerry Weighing 220t, AX-S F6 platforms. Natural gas is transported through four
Winchester commented: is designed to deploy via major trunklines of the pipeline network to an onshore
‘The abrasive jet cutter is fibre rope in four sections processing plant in Bintulu. Shell and its co-venturer
an important tool in our comprising the well control, Petronas Carigali are the production-sharing contractors,
firefighting and blowout winch, tool storage and with Shell as operator.
response business. We use it fluid management packages. Pipeline pressure isolation services are traditionally
extensively as a method to cut Rideout, who says it takes carried out in conjunction with valve change-outs on
damaged wellhead or pressure less than a day to deploy the export lines in the event of leakage. When these situations
control equipment, decreasing system, sees West Africa as the arise, TDW ‘pigs in’ the SmartPlug tool from the launcher
the time personnel are in main market for the system. past the valves that are in need of repair or replacement
hazardous environments.’ ‘Operators have told us they in order to provide safe isolation while valve maintenance
Developed by Halliburton need to start intervening in takes place. The valves are typically larger, with a 24in to
in 1991 to assist crews in these wells,’ he says. 38in bore.
Kuwait battling more than Offshore pipeline isolations of this nature typically
700 fires left after the Iraqi require a four-man crew to launch, monitor and retrieve
invasion, the jet cutting Untangling TMS the SmartPlug tool. Depending on the circumstances, the
system is designed for easy
positioning on a burning
cables operation is completed in two to four weeks. For Shell,
says TDW, the SmartPlug pipeline pressure isolation
well. It uses sand and water to A new tether management method is particularly beneficial because a number of
abrade the wellhead or surface system (TMS) design pipeline sections in this network require a double-block to
equipment, allowing a well developed jointly by safely isolate the work area from hydrocarbons. Without
to flow vertically and making contractor Subsea 7 and ROV SmartPlug technology, it would be necessary to bleed
it possible for the fire to be manufacturer Saab Seaeye down the affected work zone.
extinguished and the well is said to avoid the risk of Work associated with the three-year frame agreement
capped. cable snarl-up posed by has begun, with TDW reporting it has already successfully
Boots & Coots is planning shifts in current during ROV carried out pipeline pressure isolations on the F23 and
to place several systems in operations when multiple the M3. There are plans this autumnb to complete two
strategic locations around the TMS cages are lowered from a isolations in order to facilitate a pipeline tie-in on the F23
world. single vessel. and to replace two valves on the E11 RB.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 71

PRODUCTS IN ACTION
new subsea product centre pieces of high-strength steel
in Glasgow, Scotland. The with a special rust-control
group is currently developing coating similar to that used
core enabling technologies for the ballast tanks. From
for applications in process, tests, it was determined that
product integrity and the AirBor magnetic drill
environmental monitoring. could penetrate the steel,
One of the new systems but that the drill was too
under development is the large for the 2ft stiffener
digital wellhead for remote plates on the tanks. The
monitoring of distant company collaborated in the
production equipment, development of a specially delays.The RCV75HD from
Shrink-fit currently featuring in a designed jig that would replace Webtool Subsea is a hydraulic
Middle East pilot programme. the magnetic feed and hold the anvil cutter suitable for ROV
riser flanges The sensors, which can be drill to the ballast tank. NCA deployment for the cutting of
Subsea Riser Products readily integrated into any used the AirBor to drill some steel wire ropes, umbilical and
(SRP) reports that it has FMC system and retrofitted to 300 holes into Devils Tower. cables up to 76.2mm (3in) in
successfully attached the existing wellhead equipment, diameter.
first flanges to pipe sections communicate with a receiver Based on the original
that will make up a unique hub at the well site. The Sonar location RCV75/RCV80, Webtool says
ultra-high-pressure drilling
riser for use by Venture
hub can process the data
locally on site, or relay the
made easy the new patent pending model
has been improved to provide
Production in the North Sea. data via satellite or a local An innovative greater reliability in difficult
The flanges were joined to communication network to sonar location conditions. Apart from being
the pipes at Acteon company any office location or internet system, the significantly more durable, the
SRP’s premises in Sheffield, site the customer desires. SonarBell, has been launched main feature differentiating
UK, using a novel shrink-fit by Subsea Asset Location from its predecessor is a
process that the company Technologies (SALT). built-in interlock valve. This
developed specifically with the Devils drill Designed for applications prevents the blade from
fabrication of risers like this Running exclusively on air such as installing and locating deploying if the anvil is not
one in mind (OE August 2008). power and with a drilling deepwater pipelines and correctly positioned, making
SRP managing director capacity of up 21/16in diameter cables, the SonarBell is a the cutter much safer to use in
Simon Luffrum said: ‘The through 3in-thin steel using maintenance-free, passive conditions where the operator
development of the shrink-fit annular cutters, the AirBor sonar locator system that is unable to confirm correct
flange has been the key to this magnetic drill from CS Unitec operates by focusing energy like anvil positioning by visual
entire project. We have had can be employed for subsea a lens to amplify sound levels means.
a good deal of interest in the applications. and reflect them to the sender.
technique from a number of CS Unitec said the drill’s Looking like a bowling ball, it
other operators. Now that we adaptability offshore was utilises the two materials of Automation solution
have proved the technique it demonstrated during work its shell and core to create a Rockwell Automation
is likely to find application at Williams’ Devils Tower constructive interference that company ICS Triplex says its
in a variety of riser-related spar production platform delivers a higher return signal PlantPAx solution, launched
projects in the future.’ in the Gulf of Mexico. Not to the end user. The device is for the US oil and gas industry
The flange is first heated long after Devils Tower ‘solid state’ with no moving earlier this year and on
using induction coils to over went into production in parts or power requirements, show at Offshore Europe in
400°C, which causes it to 2004 in 5610ft water depths, and is compatible with existing Aberdeen last month, is a
expand sufficiently to fit over the operator determined commercial sonar sets. total end-to-end automation
the end of the 191/4inID riser that communication holes To bring this product to the solution that can be configured
pipe section. The flange and needed to be drilled into its manufacturing stage, ARTIS to fit the individual customer’s
the pipe are then carefully ballast tanks. Williams hired was tasked with analysing specific requirements.
brought together – this part of Lowe Offshore International and selecting an appropriate PlantPAx integrated
the process takes no more than to oversee the operation, combination of materials, solutions include: distributed
30 seconds – using a purpose- with Norse Cutting and prior to manufacture by its process control, safety and
built jig to ensure the precise Abandonment (NCA) parent company Avon Rubber. critical control, intelligent
alignment of the two parts. contracted to do the work. motor control, compressor
Simply allowing the assembly Engineers considered abrasive and turbine machinery
to cool down creates a high- water jetting, but deemed it Cutting out the control, condition monitoring
quality structural connection
and a gas-tight seal, says SRP.
too difficult to control
and settled on
guesswork and protection, predictive
modelling, value and
manual drilling as Positioning ROV mounted measurement instrumentation
more controllable tools in subsea, low visibility, management, asset
Sensing change and precise. conditions has always performance management and
The development of integrated Lowe provided a challenge to the process information.
sensing solutions for mature approached ROV pilot. Visual confirmation According to ICS Triplex,
field production equipment CS Unitec that the tool is correctly located the system has already been
is high on the agenda of about the is not always possible, and deployed in an oil industry
the Optoelectronics R&D project and incorrectly positioned tools context at a Murphy Oil
Group at FMC Technologies’ provided can fail and cause serious refinery in the US.

72 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 Perception

Reality PEMEX is awarding multi-million dollar

contracts right now. Mexico is the next
deepwater frontier and PEMEX is invest-
ing in the future right now.

PECOM – right place, right

people, right time, right now

November 17-19, 2009

Villahermosa, Mexico
713-529-1616 / Fax 713-821-1169 /
[email protected]
www.oilonline.com/mexico

OE_M_4_Page73.indd 1 29/9/09 14:34:24

FIRMS
GOING GLOBAL: FMC Technologies tech diamond manufacturing
has opened a new Global Technology market’. The deal adds about
Center on its Houston campus. Housing 45 employees to Logan’s
product technical management teams and workforce of about 360, as well
core technology groups, the center will as a 40,000ft2 facility.
serve as a ‘global hub’ for the development
of technologies required to produce A new company, TSMarine
hydrocarbons from HP/HT reservoirs and Subsea, has been formed
ultra-deepwater fields. Pictured at the following a management
opening of the new facility are Brad Beitler, buy-out of the European and
director technology, and EVP John Gremp. West African trade and assets
of TSMarine (Contracting),
in deepwater facilities for CSnet International has formed led by the company’s former
small and medium-sized a strategic partnership CEO Alasdair Cowie and
independents and has to develop its modular, Norwegian oil and gas services
projected 2009 revenues of expandable backbone company Marine Subsea.
$12 million, will retain its (OCB) concept. Contracts ‘In 2007, TSMarine
name and management were awarded to Maritime (Contracting) invested over
team. Clough is beefing up Communications Services £85 million in two newbuild
its Houston presence to for system design and to specialist vessels in a bid
handle the FEED for BHP Ocean Specialists to oversee to exploit the burgeoning

firms
FMC Technologies made two
Billiton’s Macedon gas field
development offshore Western
Australia, which will involve
procurement and installation,
with subcontracts going
subsea decommissioning
and rigless intervention
to Ocean Works International market. Significant delays
strategic additions to its oil four subsea wells routed via an for seafloor nodes and Tyco and cost overruns with their
& gas product portfolio last 85km subsea wet gas pipeline Telecommunications for the construction were posing
month with the acquisition to an onshore gas plant. supply and deployment of financial constraints across
of Direct Drive Systems, the seafloor cables and couplings. the whole business,’ explained
Cerritos, California-based Houston-based Cannon Services CSnet expects the first OCB Cowie. The buyout has
manufacturer of permanent has signed up Aberdeen- system to be deployed in late ensured that all existing jobs
magnet motors and bearings, headquartered Caledus as 2010. and contracts are safe and that
and Multi Phase Meters, the North Sea and Europe the Aberdeen-based operations
Stavanger, Norway-based representative for the Cannon Composite repairs specialist business can continue to grow,
manufacturer of multiphase range of protection systems Walker Technical Resources is he added.
flow meters. FMC boss Peter for downhole completion joining forces with Louisiana- With support from
Kinnear said combining control lines and cables. Paul based Fairwinds International. Marine Subsea, TSMarine
with DDS (in a $120 million Howlett, CEO and co-founder Fairwinds will be the WTR Subsea will focus on
transaction) would ‘allow for of Caledus, said Cannon’s distributor in the US, the continued delivery
the creation of next-generation products would complement providing composite pipe of rigless intervention,
pumping and compression his company’s drilling total repair services under the decommissioning and subsea
solutions’ while the MPM depth solutions, in particular name Technopipe America. construction services in
purchase (for an initial the Disposable CleanUP Europe and West Africa, with
$30 million cash payment and Tool and NaviGATOR Sub. Logan Oil Tools has acquired support from well intervention
two earn-out payments based He added: ‘Leveraging off fellow Houston-based Dennis specialists Lewis, owned by
on 6.6 times 2012 and 2013 the expertise that we have Tool Company for an undisclosed Marine Subsea.
EBITDA) would enable FMC between us, we envisage that sum. Logan, which TSMarine (Contracting)
to ‘further optimize its subsea Caledus and Cannon Services manufactures fishing tools will continue to provide
technologies’. Both deals are will create a new range of and related products, said rigless intervention,
due to close in 4Q 2009. solutions for the completions the addition of Dennis Tool’s decommissioning and subsea
market in the North Sea, PDC cutters for drill bits, construction services to
Expro has officially opened and we would hope this bearings and other products clients across the Asia Pacific
its new Subsea Excellence relationship would extend to would provide the company region through its subsidiaries
Centre in Ulverston, UK. A other regions in future.’ with ‘an entry into the high- in Australia and Singapore.
£12 million investment, the
new facility will consolidate ROBOTICS ARM: Fugro has acquired UK simulation and
the company’s Connectors & visualisation software supplier General Robotics. The firm
Measurements operations. will be renamed Fugro GRL and become part of Fugro Subsea
Services, keeping the same management team and staff headed
Australian contractor Clough by Dr Jason Tisdall. While developing and implementing
has acquired Houston-based products for Fugro operating companies, Fugro GRL will have
Ocean Flow International. Clough commercial independence to pursue activities outside Fugro. The
has initially acquired 70% of company will continue to maintain offices in Milton Keynes and
the subsea engineering and Aberdeen.
construction management General Robotics was founded by the late Professor David
firm’s shares, with the Broome of University College, London and develops customised,
remainder expected to follow subsea simulation products primarily for the offshore oil industry.
over the next three years. Pictured (left to right) are GRL’s Dr Jason Tisdall, Jim Mann,
Ocean Flow, which specializes Fugro global ROV manager and Jeff Coutts, MD of Fugro GEOS.

74 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 FACES
the transition to the new Shell Mattijs de Lange Randy Giroir has become HSE
Upstream Americas deepwater (pictured) has coordinator for InterMoor’s
business, working with EVP joined Neptune Port Fourchon, Louisiana
John Hollowell and the New Survey Expedition facility, joining the firm from
Orleans leadership team. as business Oceaneering International’s
development director, tasked diving division.
Jon Jeppesen, Anthony Lannie and with further developing
Kregg Olson have been promoted Netherlands-based Neptune as Chris Cottam has joined Stingray
to EVP at Apache Corporation. an independent survey company. as VP global sales, based in
Jeppesen was previously SVP, the company’s newly opened
a position he had held since Kevin Kerins has been promoted Houston office. He previously
2003. Lannie had been SVP from general manager to SVP, held operational, sales and
and general counsel since 2004, ROVs at Oceaneering. He senior management positions
and Olson was previously will continue to oversee the with Scott Pickford, Core
SVP, corporate reservoir worldwide ROV business for Laboratories, ION Geophysical
engineering. the company, where he has and Paradigm. Alan Knowlton has
worked for 31 years. also joined Stingray as supply
W Troy Roder succeeds the chain director.
retiring Michael Beaumont as Wade Abadie has been named
chairman and CEO of Foster president and COO at Deep Louise MacKenzie
Wheeler Energy, based in Marine Technology, where (pictured) has

faces
Juan José Suárez Coppel has been
Reading, UK, with effect
from 1 January 2010. Roder is
currently president and CEO of
he will continue to oversee
company operations. He joined
been appointed
HR manager for
the company in 2005 after Europe and West
appointed director general of Foster Wheeler USA, based in more than three decades in the Africa at marine crane and
Petróleos Mexicanos (Pemex) Houston. subsea deepwater industry. lifting specialist Sparrows
by President Felipe Calderón, Offshore Services, based in
replacing Jesús Reyes Heroles. Alan Millmaker Ian Kirk (pictured), one Aberdeen. She previously
Suárez Coppel, who has served (pictured) has joined of the three founders held management posts with
as director of finance at Pemex Sigma Offshore of Aberdeen-based Cameron and Vetco Gray.
and coordinator of advisors as EP business Downhole Products, Sparrows Offshore Services
to Mexico’s finance minister, development. Based has been appointed also recently appointed
holds a PhD in economics from in Houston, the former head managing director following Michelle Wainwright as corporate
the University of Chicago. of Bluewater Engineering the company’s acquisition by communications manager.
Services’ US operation is tasked US-based Varel International.
Steven Newman with winning business in the Kirk, a mechanical engineer, Mogens Thyssen has been hired
(pictured) will Gulf of Mexico and elsewhere launched Downhole Products in as Middle East business
become Transocean for Scottish-based Sigma’s 1994 alongside Bill Barron and development manager for the
CEO upon the Smart Mooring System. Eirik Alistair Clark. Ferguson Group, based in Dubai
retirement of Robert Refstie (pictured), . and tasked with promoting
Long in 1Q 2010. Newman is previously with Harvey McBee, Katia Georgiev, offshore the group’s modular
currently president and COO at Norway’s Aibel and Jack Zhong and Bilei Chen have and container divisions. He joins
the company, a position he has SPT Group, has also joined FloaTEC. McBee was from Bluewater Shipping in
occupied since May last year. joined Sigma as VP named senior project manager; Denmark.
He has held a variety of senior business development and will Georgiev is the new lead marine
management roles since joining head up its new Oslo office. systems engineer; Zhong was Steve Ballantyne
Transocean in 1994. named principal structural (pictured) has joined
Garry Mahoney is the new CTO engineer; and Chen was hired ESR Technology in
Frank Glaviano will retire at IntecSea. Mahoney, who as a structural engineer. Aberdeen as an asset
as Shell’s VP production, will be based in Houston, was integrity consultant.
Americas region, at the end previously a director in the G Kregg Lunsford has been He previously worked for Baker
of November. Glaviano, based Eni/Saipem group. Another promoted to EVP eastern Hughes as a reliability engineer
in New Orleans, will assist in newcomer at IntecSea is Bill hemisphere for Cal Dive, and for nine years.
Westcott, who has been named Jon Minshall has stepped up
DOUBLE TAKE: Sharp- director, business development, from director of quality to VP James Denney will become VP
eyed OE readers may Americas. He joins the projects and operations, eastern operations at Scorpion Offshore
have noticed the uncanny company from Lloyd’s Register, hemisphere. Both men are upon the 4Q 2009 retirement of
resemblance between two where he most recently served based in Singapore. George Bruce Brumley. Denney is
of our authors in the July as VP, upstream oil & gas, a former chairman of Nabors
edition. That’s because, due to a pre-press Americas. Helene Torjusen Well Services, president of
slip up, they were indeed one and the (pictured) has Nabors Alaska and operations
same person: Schlumberger Subsea’s Jack Jacobs has joined Heerema been appointed manager for Nabors in the
Andy Hill, above. For the record, the Marine Contractors (HMC) marketing manager North Sea.
missing Hill – Paul Hill, as interim CEO for a period of TD Williamson
composite repairs specialist of about 18 months. Prior to subsidiary TDW Offshore Dr Terry Stebbings has joined
at Furmanite – is pictured joining HMC, he was interim Services, based in Stavanger. Aberdeen-based iicorr to head
left. Our apologies to both CFO for energy company She joins TDW from Microsoft up the company’s integrity
gentlemen. Eneco. in Oslo. consultancy business unit.

www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 75

EVENTS

Call for papers

20-26 June 2010 ISOPE. Conference,
Beijing. Abstracts by 20 October.
www.isope.org
12-16 September 2010 World energy
congress. Forum & exhibition,
Montreal. Abstracts by
15 January 2010.
www.wecmontreal2010.ca/papers

Please send conference,

exhibition and meeting entries,
19-21 LNG tech global summit.
Conference, Rotterdam.
seminar, Rio de Janeiro.
www.imca-int.com/events
Looking ahead
and also calls for papers to: www.lngsummit.com 4-6 Deepwater Congress. The near future of the
[email protected] 20-22 Drilling & completing trouble Conference, Hainan, China. global energy market is
zones. Conference & exhibition, Contact Alan Shen, Noppen; dependent on successful
Galveston, Texas. [email protected] mature field management.
www.DrillingTroubleZones.com 9/10 IADC annual meeting. Securing and sustaining
20-23 Santos offshore. Conference Conference, Miami. investment in mature fields
& expo, Sao Paulo. www.iadc.org is critical to ensure optimal

diary www.santosoffshore.com.br
21-23 Society of Naval Architects
10/11 Digital E&P. Conference,
Houston. www.digitaleandp.com
basin recovery, field life
extension and prevent future
& Marine Engineers. Annual 11 Decommissioning. SUT market failure.
October meeting & expo, Providence, evening meeting, Aberdeen. Optimising recovery in mature
4-7 SPE annual technical. SPE Rhode Island. www.sname.org Contact [email protected]; oil & gas fields, a forum to
conference & exhibition, New 26-28 SPE/IADC Middle East drilling www.events.sut.org.uk be held 18-20 November in
Orleans. www.spe.org/atce technology. Conference & 11/12 Financial modelling in the oil Barcelona, is the third annual
5-9 24th World Gas. Conference, exhibition, Bahrain. Contact & gas industry. SMi conference, conference on ensuring
Buenos Aires. Contact [email protected]; London. www.smi-online.co.uk optimal field recovery, asset
WGC2009; +54 11 5252 9801; www.iadc.org 16-19 Latin America LPG. life extension and boosting
www.wgc2009.com 27/28 Gas to liquids. SMi Seminar, Miami. production.
6-9 KIOGE. Conference & conference, London. www.purvingertz.com Organised by Marcus
exhibition, Almaty. www.smi-online.co.uk 17 Technology and rig challenges Evans, the forum will discuss
www.kioge.com 27-29 LAGCOE – Louisiana Gulf in ultra-deep Gulf of Mexico and evaluate alternative
7 Obsolescence (life extension). Coast Oil Expo. Conference, completions. IADC conference, recovery methodologies
SUT evening meeting, Lafayette. www.LAGCOE.com Houston. www.iadc.org with lower application risks
Aberdeen. Contact 27-29 Oil & gas outlook LatAm. 17-19 PECOM. Conference & and technology advances to
[email protected]; Conference, Houston. exhibition, Villahermosa, maximise the production and
www.events.sut.org.uk www.terrapinn.com/2009/ Mexico. Contact Roland optimise the management
13/14 Dynamic positioning. latoil Martinez, IEI; tel: +1 713 529 within a reservoir.
Conference, Houston. 27-29 OGS. Conference & 1616; [email protected] Key topics to be covered
www.dynamic-positioning.com exhibition, Dubai. 18/19 Well control Asia Pacific. include: the latest EOR
13/14 Reliability and integrated www.ogsonline.com IADC conference & exhibition, applications to increase
management of oil & gas assets. 29-31 Vietnam oil & gas expo. Bangkok. www.iadc.org productivity; how to increase
IQPC conference, Kuala Conference & exhibition, Ho 18-20 Optimising recovery in mature recovery rates; improving
Lumpur. www.iqpc.com.sg Chi Minh City. oil & gas fields. Conference & oil recovery while reducing
14/15 Norwegian petroleum www.cpexhibition.com/oil exhibition, Barcelona. CO2 emissions; successful
technology. SPE conference, www.marcusevans.com field redevelopment and
Bergen. www.spe.org November 18-20 ASCOPE. Conference & implementation of effective
14/15 Unconventional oil. SMi 2-6 Africa oil week. Conference, exhibition, Bangkok. reservoir management
conference, London. Cape Town. www.iemallworld.com strategies.
www.smi-online.co.uk www.petro21.com 24/25 EAGC. Conference, Bilbao. Speakers include: Rodolfo
14-16 Deepwater Southeast Asia 3-5 Offshore communications. www.theeagc.com Dino, Petrobras; Virendra
congress. Conference, Kuala Conference, Houston. Singh, Repsol YPF; Mehran
Lumpur. www.dsacongress.com www.OffshoreComs.com December Shorabi, Heriot-Watt
14-16 SIPPE – Petroleum, 3-5 APPEC. Conference & 2 SUT Aberdeen AGM. SUT University; John Gluyas,
petrochemical & natural exhibition, Singapore. meeting & dinner, Aberdeen. Acorn Oil & Gas; Andreas
gas technology equipment. www.ace-events.com.sg Contact [email protected]; Gobi, ExxonMobil; Jon
Exhibition, Shanghai. 3-5 Petroleum Asia. Conference www.events.sut.org.uk Gluyas, Acorn Oil & Gas;
www.sippe.org.cn & expo, Kuching, Malaysia. 7-9 IPTC international petroleum Julius Walker, IEA; Robin
14-17 Oil & gas Indonesia. Contact [email protected] technology. SPE/AAPG/EAGE/ Mills, ENOC; Dave Pinchin,
Conference & exhibition, 4 Assessment of anchor chains. SEG/GPA Conference & Well Processing AS; and
Jakarta. www.iemallworld.com Offshore Engineering Society exhibition, Qatar. Fernando de Miguel, Gas
19-21 Reservoir characterization meeting, London. Contact www.iptcnet.org/2009 Natural.
and simulation. SPE/EAGC [email protected] 10 SUT AGM. London. Contact For further details go to
conference & exhibition, Abu 4/5 Integrated marine operations in [email protected]; www.marcusevans.com
Dhabi. www.spe.org challenging times. IMCA annual www.events.sut.org.uk

76 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

 DISPLAY ADVERTISERS
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www.offshore-engineer.com OFFSHORE ENGINEER | october 2009 77

oe_M_4_p078 Catalogue 29/9/09 2:16 pm Page 78

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w w w . o f f s h o r e - e n g i n e e r. c o m OFFSHORE ENGINEER | october 2009 81

EBB AND FLOW
‘China can lead the world to its next stage by actually
using its energy challenge. It can turn a looming potential
catastrophe into an opportunity. It can show the way.’

by Prof Michael J
Economides

Confucian must not reign

nergy will be China’s choke point, and the search for abundance and the good life that is so desired by the country.

E adequate energy resources will be as important a priority

for that nation as for any. And yet the Chinese, ever the
Confucian, suffer from three serious deficiencies:
Resolving the certain, looming shortages should be the highest
priority of the government, energy companies, and all national
institutions.
First, in imitating their role model, the United States, they Second, because of international competition and because of
are prone to fall for the same ideologically driven silliness in its clear aversion to confrontation, China should find answers
energy, currently taking hold there. Desperate to be liked and inside its borders. This implies that the plan to emulate the US
to be relevant internationally, the Chinese are likely to repeat in all respects, a thinly disguised national obsession for three
the politically correct mantras of conservation
ation and alternatives decades, will have to be radically readjusted.
such as wind, solar, and ‘advanced biofuels’. s’. lifestyle and urbanization are to continue
Third, if personal lifes
Second, conservation has never demonstratedtrated a reduction n as una worthwhile, and unstoppable processes, they have
unabated, worthwhile
of total energy use. If anything, conservation
ion has done tthe he to be eenabled
nabled by means other than importing ever-increasing
ena
opposite because becoming more efficient, in a world d that
thatt volumes
vol
v
vo
olu
ummes ofo oil. Coal, which the nation has in abundance,
has identified energy as an enabler of a better has
tter life, h led
as le
ed hass to
ha t pl
play increased role, but nuclear certainly has
a an inc
to new uses of energy. If houses become more efficient,
ore effic
icie
ent,
nt, to expand
o ex
exp
xpan manifold. Today, these energy sources
and man
people buy bigger houses; if cars become more contribute
co
contriribute ppractically nothing to transportation.
efficient, people buy bigger cars or second cars. The
T e only way to remedy this is by electrifying
he
For China, conservation certainly will nott lead transportation
tr
ranspor or, in the case of coal, to embark
to a reduction in demand. on
o liquefaction and (even more bold)
n coal li
Third, China will not become a militaristic power
stic pow werr gasification,
g a ification, producing natural gas or hydrogen.
gasif
anytime soon, one that would emulate the US in a Hydrogen
H
Hydro
ydrogen can b be used to power the vehicles of the
Gulf War-type of action to safeguard its potential
tential energyrgy future.
fut
fu
utu
ure.
re
sources. A strong-arm presence is not on the he horizon. In fact,
n fa
facct, Such
S uch transition is painful anywhere, but in China it
China is likely to shy away from any sort of confrontationall willl have
wil h massive, on a scale never before attempted or
to be massive
environment, satisfied to go where no-one else wants to go, fathomed. By 2020, as ma many as 40% of Chinese vehicles should
including unsavory places such as Sudan, Myanmar
Myanmar, and Iran Iran. electricity. This c
run on electricity can be done either with batteries or
If China were the US in this respect, the standoff in the South by providing guideways where vehicles draw continuous
China and East China seas would never happen. The country electricity.
would ignore far weaker nations and forge ahead with oil and The technology is already available, or nearly so. Because
gas development. By the same token, Vietnam, the Philippines, China’s transportation sector is likely to grow at a rapid
Malaysia, and even Japan, would never have acted the way they pace, building different infrastructure is only slightly more
did had their opponent been the US. If China cannot throw its cumbersome than adding to existing infrastructure. China is
weight in its own backyard, how can it do so elsewhere? starting at a far earlier point in its infrastructure development
Burdened by real environmental problems, some of which than the US or Europe, which will work in its favor. Nations
have reached catastrophic levels, China has become very with fully developed infrastructure are burdened by it and are
defensive, occasionally making public statements that, if taken far more reluctant to change.
seriously, are nothing less than throwing the baby out with the China can lead the world to its next stage by actually using its
bathwater. ‘Pollution’ thus becomes all-encompassing, covering energy challenge. It can turn a looming potential catastrophe
everything from the real issues of nitrogen dioxide, sulfur into an opportunity. It can show the way. And, in the process,
dioxide, and particulates, to the emissions of carbon dioxide. its massive energy development will provide a necessary
Of course, nobody really believes that China will ever even repudiation of the drivel of global warming, its assorted and
come close to a CO2-constrained economy and energy use. In inherently defeatist rhetoric, and the decreased quality of life
fact, the danger is that the almost certain failure to comply with that activists advocate. China can become a beacon of optimism.
any Kyoto or successor accords may muddle the issues and Energy has enabled this for the world for the past 150 years, and
prevent real environmental stewardship in the form of cleaning China can add 150 more years of prosperity in the future with
up water bodies and rivers and, more urgently, improving sane energy policies. OE
air quality. China is in real need of this work, and it must act z Michael J Economides is a professor at the Cullen College of
immediately and massively. Engineering, University of Houston, and editor-in-chief of the
So, let’s attempt to offer the Chinese a future energy blueprint. Energy Tribune. The views expressed in this column do not
First, recognize the intimate connection between energy necessarily reflect OE’s position.

L Prof Michael Economides’ latest book Energy: China’s Choke Point has just been published.
Autographed copies at a special price of $25 (plus shipping on orders outside US) are available. Email orders to: [email protected]

82 OFFSHORE ENGINEER | october 2009 www.offshore-engineer.com

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