OGV Energy - Issue 38 - November 2020 - Digital Transformation

NOVEMBER AUGUST 2020 2020

UK’s No.

ENERGY SECTOR

1

PUBLICATION

THE DIGITAL TRANSFORMATION ISSUE

FOSSIL FUELS North Sea Oil & Gas Review and Analytics

PROJECTS MAP CONTRACT AWARDS REGIONAL REVIEWS Middle East, Europe, US, Australia

DIGITAL TRANSFORMATION FOCUS INNOVATION & TECH GREEN ENERGY ON THE MOVE

DIGITAL TRANSFORMATION

The energy industry needs to adopt digital to survive Featuring: Stena Drilling - Arnlea - Intebloc - Petrofac Qdos - Marine Technical Limits - Norwell Edge - IDS

INNOVATION

OPINION EVENTS LEGAL

Smart Data Analytics, safety enhancement and cost-saving technologies to help the energy industry move forward.

REGIONAL NEWS

OPEC warned of a fragile economic growth recovery.

COVID-19 Pandemic shaking up energy markets in the western hemisphere.

Read on page 26

CONTENTS

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FOSSIL FUELS

7 UK North Sea Oil & Gas Review 10 Rystad Analytics 13 UKCS Status Report

REGIONAL REVIEWS 26

20 Middle East 22 Europe 24 US 25 Australia

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DECOMMISSIONING FOCUS 31

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26 Eserv: Making digitalisation the norm, not the novelty 28 Digital Transformation: The Next Frontier in Oil & Gas 30 Arnlea: Respecting the hierarchy of data 31 IDS: Automated reporting 32 Stena Drilling: Digital business transformation 33 Intebloc: Intelligent crane & lifting technology 34 QHSE Aberdeen: Benefits of ISO 27001 35 Norwell Edge: Learning to embrace digital change 36 Petrofac to join the Project Data Analytics Task Force 37 Marine Technical Limits: Fully digitised workflow

INNOVATION ZONE 34

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38 Intertek: "InProcess" application helping Intertek's clients manage big data 39 Pragma Well Technologies: Enhanced safety for retrofitted artificial lift 39 ABB to lower delivery time and costs with the Adaptive Execution

GREEN ENERGY

40 Spanish group to start building ‘disruptive’ floating demo 41 Shared anchors slice cost of floating wind parts, vessels

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EVERY MONTH

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14 EIC: World Project Maps 16 Contract Awards 42 Ducatus Partners: On the Move 44 Opinion: Offshore Energy - The dawn of digitalisation (By Moray Melhuish) 46 Company News: Namaka Subsea - QHSE Aberdeen 47 Traveleads: Events 48 People in Energy: QDOS - preparing for IR35 reform 49 Broadies: Legal and Finance 50 Company News: Covid-19 risk assessments and return to work planning

KENNY DOOLEY MAIN EDITOR As we close in on the final eight or nine weeks of the year, a combination of the pandemic and low commodity prices are still causing uncertainty in the market and we still find ourselves in a situation that makes it difficult to plan more than three to six months ahead.

We are however having increasingly positive conversations with the supply chain and companies are making hires, even though it has been done quietly by many. The supply chain are investing in new equipment, they are developing their client base both locally and internationally and I’m confident all of this investment will stand them and the industry in good stead moving forward.

At OGV Energy our recently launched membership service, OGV Community, now has over 100 members including large blue-chip companies such as Petrofac, Stena Drilling and Bilfinger Salamis and well as SME's such as Nucore, Dales Marine and Glacier Energy, which is great news for our members.

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We are delighted to welcome EServ as our cover partner this month and they share with us how they are using digital technology to help their operator clients to maximise the use of their data to save time and money in the management of their assets.

Our theme this month is digital transformation and we gain insights from Stena Drilling, IDS, Intebloc, Petrofac, Arnlea Systems and Marine Technical Limits on how they are developing technological solutions to give them a competitive edge.

The rest of this month’s magazine features our regular reviews of the Energy sector in the North Sea, Europe, Middle East, the US and Australasia, along with industry analysis and project updates from Rystad Energy and the EIC as well as an article on IR35 legislation from QDOS as they explain how they worked with Ithica Energy to help them manage their contract workforce.

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Thanks again to all our readers for all their support throughout the year and as always, if the OGV Energy team can help in any way, be that to have a chat, offer any advice or an introduction then please get in touch.

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INSIGHT

Digital is hard to sell, hard to scale and low margin So what’s the attraction?

Author – Stuart R Broadley FEI CEO, EIC (Energy Industries Council)

S

ince 2017, the need for faster adoption of digital technology across the energy industry has been a hyper-topic of conference organisers and consultants, but the reality persists that operators are stubbornly cautious about digital technology.

Recent statistics (source EIC Survive & Thrive) back this up with only 26% of UK energy supply chain companies investing in the development of digital technology as their primary growth strategy in 2020, compared with 32% in 2019, showing its popularity as a growth strategy is already waning.

Oil & gas and nuclear operators remain extremely risk averse, preferring a “small bites of the elephant” adoption approach with digital rather than “boiling the ocean”. Many industry leaders are poorly trained in digital, at risk of being ineffectual as leaders of digital talent and too concerned about taking unnecessary risks.

Digital can quickly become “nice to have” rather than “must have”. How much is anyone willing to pay for “nice to have”?

The answer is not much... selling digital solutions to a risk averse, poorly trained and price-sensitive customer is HARD; certainly not a way to increase a supplier’s prices, or margins; indeed, it can have the opposite effect.

In other infamous sectors, totally transformed and disrupted due to digital (Uber, Amazon, DHL etc), lower prices and margins are normal, but the scale, volume and cost/process efficiencies have allowed ultimately high profits and market dominance.

www.ogvenergy.co.uk I November 2020

“dot.com” businesses, now hugely profitable, themselves took a long time to get to profit originally. This is a lesson for all companies wanting to adopt digital strategies in the energy sector; indeed it will arguably be even harder in the energy sector, as there is little true disruption (yet) - more evolution than revolution.

Once the pain point is successfully healed, use this initial success as a “Trojan Horse” to then open more opportunities, and build on the new insight, relationship and data transparency.

Avoid tendering, by working instead on dozens of smaller projects, with fast fixes and lead times of weeks and months, not years. Limit yourself to “90 days from data to value”. If the budget owner is not committing after 90 days, move on to the next digital opportunity.

Digital scale up brings the value - but scale is hard to deliver in energy markets; energy companies are typically made up of many independently managed projects and facilities, The renewable sector is far more advanced located in hard to access locations, poorly with digital technology adoption, so connected, with high operational risks, the risk-aversion is far lower but and often managed by distributed so is the chance of winning is and autonomous business also lower, as they are likely leaders. This is not an easy to already have partners and B2B environment in which With tight margins and technologies in place. to scale up in. erratic energy market

behaviours, de-risk your

For oil & gas and nuclear, And yet, after all the bruising business by offering collaborate with Tier 1 of three years hitting the your digital talents and EPC Contractors where digital wall, the industry technologies to as many possible, as they are continues to look to digital currently highly motivated to for answers to innovation, sectors as you can. find new partners to access efficiency improvement, cost the latest, greatest technology reduction, safety, emergency as they search for new routes to response, seamless collaboration, differentiate and increase margins. accelerated diversification and most recently as a “must-have” solution to managing Finally, diversify across as many sectors in a COVID world. as you can. With tight margins and erratic energy market behaviours, de-risk your It seems that it is still worth persevering with business by offering your digital talents and digital – as a technology developer and operator, technologies to as many sectors as you can. and there are some established lessons that can No longer feel loyalty to just oil & gas or just help you smooth the road to success and avoid energy, but instead look beyond to sectors over-promising and under-delivering. like defence, infrastructure, chemical, marine, pharmaceutic, even sports; all are fair game Focus on finding out and then solving the and important routes as you strive to de-risk, customer’s specific pain point, rather than grow and innovate. offering a one-stop-shop digital service for all.

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FOSSIL FUELS

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NOVEMBER

UK North Sea Oil & Gas Review

By Tsvetana Paraskova

A big merger deal, the prospects of UK’s oil and gas production, company strategies and operations updates marked this past month’s major news stories in the UK North Sea.

The recent massive downgrade of Hurricane Energy’s Lancaster field has prompted Rystad Energy to revise down its oil and gas production forecast for the UKCS, with output expected to never exceed 2 million boepd again.

UK oil and gas production has dropped steadily since its peak at 4.3 million boepd in 1999, never exceeding 2 million boepd after 2010. Before Hurricane Energy’s downgrade of the Lancaster field, Rystad expected UK output to reach 2.1 million boepd by 2035. After the downgrade, Rystad now sees production reaching a maximum of 1.7 million boepd in 2035.

“The main takeaway here is that we may never again see any significant production upsurge in UKCS production.

A possible game-changer could now only be a development of technical skills for producing from fractured basement reservoirs to increase the recovery factor,” said Olga Savenkova, upstream analyst at Rystad Energy.

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FOSSIL FUELS Nearly 75% of respondents do not expect to make redundancies in the near future and 56% are fairly optimistic about the next six to twelve months. Yet, nearly 23% are reducing staff, while just 3.5% are actively recruiting. As of 2019, the subsea industry in the UK employed 45,000 people.

The Oil and Gas Authority (OGA) has for the first time expanded its benchmarking to the flaring and venting of greenhouse gases on the UKCS, revealing flaring and venting activity levels in the North Sea and the resulting contribution to UK oil and gas greenhouse gas emissions.

According the OGA, the volume of gas flared and vented in offshore upstream oil and gas production last year was equivalent to 3% of all the natural gas produced. However, the volume of gas flared last year was down by 4% compared to 2018—the first annual reduction since 2014.

The top three priorities for subsea SMEs now are the health and well-being of employees, cash-flow, and lack of visibility over project work and their order books.

“Although there have been major redundancy programmes across the tier one companies, the situation among SMEs – who make up the bulk of the subsea supply chain – does not appear quite so gloomy. However, this cautious optimism must be put in context with the overall bleak outlook we are seeing,” said Subsea UK’s chief executive, Neil Gordon.

“While it’s encouraging to see a fall in volumes flared and vented, we believe there are clear opportunities for industry to go further to advance cleaner production,” said Hedvig Ljungerud, OGA Director of Strategy.

“Our benchmarking has already been proven to raise performance levels in other areas, such as production and decommissioning cost efficiency, enabling operators to learn from good examples set by others and allowing us to focus our attention and interventions in the right areas,” Ljungerud added.

Environmental groups Platform, Friends of the Earth Scotland, and Greenpeace UK published a survey, saying that 81% of offshore oil and gas workers consider leaving the industry.

The survey drew reaction from the OGUK, the leading representative body for the UK’s offshore oil and gas industry, which repeated calls to campaign groups to meaningfully engage with the sector to ensure a fair transition for energy communities.

“At a time when all industries are navigating unprecedented financial pressures, it is disheartening that some campaign groups are painting a misleading picture to suit a particular agenda, when in fact we could be much more effective if we work together to embrace the net zero opportunity,” OGUK Chief Executive Deirdre Michie said in a statement.

“A huge proportion of companies in our industry have been supporting projects across the full energy spectrum including in renewables for years,” Michie noted.

In early October, the OGA awarded a carbon dioxide (CO2) appraisal and storage licence (CS licence) in the Liverpool Bay area of the East Irish Sea to Eni UK Limited. Under the licence, Eni plans to reuse and repurpose depleted hydrocarbon reservoirs and associated infrastructure to permanently store CO2 captured in northwest England and northern Wales.

“This is a vitally important project for Eni and represents a milestone for the 2050 Net Zero ambitions of the UK and a fundamental pillar for the strategy of energy transition and decarbonisation that Eni is strongly committed to,” Eni CEO Claudio Descalzi said.

Small and medium-sized enterprises (SMEs) in the subsea supply chain are cautiously optimistic about the immediate future in the next six to twelve months, according to a snapshot survey of the UK’s £7.8-billion subsea supply chain carried out by industry body Subsea UK.

www.ogvenergy.co.uk I November 2020

Company news

Environmental groups Platform, Friends of the Earth Scotland, and Greenpeace UK published a survey, saying that 81% of offshore oil and gas workers consider leaving the industry.

Shell said it was restructuring operations in light of its ambition to play a role in the energy transition and a lower-carbon future. The reorganisation and expected efficiencies mean that Shell will reduce between 7,000 and 9,000 jobs by the end of 2022, chief executive Ben van Beurden said.

In a major deal in the UK oil and gas sector, Premier Oil and Chrysaor said on 6 October they plan to merge, creating the largest listed independent oil and gas operator in the UK North Sea. Under the proposed all-share transaction, Premier Oil will merge with Chrysaor through a reverse takeover, and the London listing of the company will be retained. Premier Oil’s creditors will receive US$1.232 billion in cash, and Premier’s total gross debt of around US$2.7 billion, as well as certain hedging liabilities, will be repaid and cancelled on completion of the transaction.

Chrysaor’s biggest current shareholder, Harbour Energy, and other Chrysaor shareholders are set to own at least 77% in the new group, while Premier Oil’s stakeholders will own up to 23% of the combined company.

“Chrysaor and Premier Oil are great stewards, contributors and champions of this industry so this investment is encouraging news for the UK Continental Shelf,” OGUK’s Michie said, commenting on the news.

“With companies increasingly looking to see how they can work together to meet as much of our oil and gas demand from domestic resources instead of imports, this merger will help to stimulate further activity for our hard-pressed supply chain and contribute to an inclusive transition towards a low carbon economy,” Michie added.

Greig Aitken, principal analyst on Wood Mackenzie’s corporate analysis team, said about the deal: “Above all, the merger adds scale. Size matters in oil and gas. Particularly in tapping additional sources of finance during periods of volatility.”

“Bigger, more efficient producers that are resilient enough to see through the cycles – but small enough not to be weighed down by internal competition for capital and high G&A costs – are better equipped to collaborate with the supply chain, maximise recovery and deliver consistent returns to shareholders,” Aitken said, adding that the UK sector is “ripe for consolidation.”

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Archer secured a four-year contract extension with Apache Corporation for the provision of platform drilling operations and maintenance services on Beryl Alpha and Bravo, Forties Alpha, Bravo, Charlie and Delta in the UK North Sea. The extension, of an estimated value of up to US$100 million, will begin on 1 January 2021 in direct continuation of the current contract.

CGG said at the end of September it had completed the first phase of its multi-year program to deliver the largest OBN multi-client survey ever acquired in the UK Central North Sea. The company also began the second acquisition phase. The survey started in March 2020 and has already received significant industry interest and prefunding, with first images targeted for Q1 2021.

Neptune Energy and its joint venture partners BP and JAPEX launched the subsea construction phase of the Seagull tie-back project on 23 September.

In early October, Neptune Energy announced the appointment of Pierre Girard to the newly-created role of Director of New Energy.

In August, Neptune had announced the decision to create a New Energy team to scale partnerships and investments in low-carbon technologies, particularly hydrogen, carbon capture and storage (CCS), and electrification.

Cairn Energy PLC deferred Catcher North and Laverda wells from the 2020 programme as it adjusted its forward capital programme to current market conditions, the company said in the half-yearly results, which showed net oil production averaging around 22,400 bopd, at

the top end of the full-year guidance. Full-year oil production guidance is 21,000 - 23,000 bopd net, and Cairn Energy targets an average production cost of around US$18 per barrel of oil equivalent (boe).

Independent Oil and Gas Plc said on 5 October that it does not intend to make an offer to buy Deltic Energy plc, after Deltic’s board rejected an improved offer earlier in October.

Controls technology company Proserv Controls signed in early October a strategic alliance agreement with power system monitoring provider Synaptec to develop a cutting-edge integrated holistic cable monitoring system, which will reduce downtime, improve safety, and lower operating costs at offshore wind farms.

Serica Energy plc said on 12 October that it had started offshore operations to prepare the Rhum R3 well for production in the Rhum field, some 380 kilometres northeast of Aberdeen.

Wood plc has signed a three-year agreement with Equinor to deliver operations, maintenance, modifications, and offshore services on the Mariner A platform and Mariner B floating storage unit. The agreement, valued at around US$75 million, will run for three years from January 2021, with options to extend. The work will be delivered by Wood’s Aberdeen-based onshore and offshore teams, with support from its global engineering community. The Mariner field is Equinor’s first operated development in the UK North Sea.

1

YEAR AGO

- BRENT OIL PRICE 2019 - $63.21 The UK Government ordered immediate moratorium on fracking in England because of tremor risk.

The government had issued an immediate moratorium in England because of the risk of earth tremors. Governments in Scotland, Wales and Northern Ireland had already issued measures that amount to moratoriums on fracking.

5

YEARS AGO

- BRENT OIL PRICE 2015 - $44.27 Scotland Greenlights World’s Largest Floating Wind Project.

The Scottish Government has granted a marine licence to Statoil for the construction of Hywind Scotland project, the world’s largest floating offshore wind development. The pilot park comprised five floating 6MW turbines installed off the coast of Peterhead, The Hywind Scotland development was expected to power up to 19,900 houses.

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10

YEARS AGO

- BRENT OIL PRICE 2010 - $85.28 'Urgent action' needed to secure energy supply as one of Scotland's most successful companies had warned MSPs that urgent action is needed to secure the country's energy supply.

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Government targets for renewable energy were ridiculed as "unrealistic". Britain was not looking like an attractive place to invest when other nations were also wanting to renew their power stations.

The decommissioning conundrum

The hidden value behind data

Technology and Innovation

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FOSSIL FUELS

Conducted by Craig Jamieson and Oddmund Føre @ Rystad Energy

Service Market Drivers Greenfield project sanctioning

Database version: Rystad Energy Databases October 2020 Review

Sanctioning year (2016 - 2022)

Year (2016 - 2022)

Year (2016 - 2022)

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The consistency of data is a result of our systematic research by combining publicly available information and Rystad Energy’s estimates and models. Our analysts gather data from company reports, investor presentations and press releases, governmental sources, as well as public institutions such as IEA, OPEC, USGS, and NPD.

www.ogvenergy.co.uk I November 2020

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OGV Energy is delighted to be working in partnership with global energy knowledge house, Rystad Energy, to bring industry insights and analytic detail to our readers in Oil & Gas. As the sector continues to digitise operations on a project and company basis, this high-level monthly data aims to provide key information in context from an industrywide perspective and demonstrate the technology available for those seeking deeper insights to enhance strategic planning and development.

Offshore Rig Market Analysis Fleet current stats

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Conducted by Craig Jamieson and Oddmund Føre @ Rystad Energy

Database version: Rystad Energy Databases Ocotber 2020 Review

Offshore Rig Market Analysis Utilisation

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PROUD TO BE IN PARTNERSHIP WITH

OGV Energy is delighted to be working in partnership with global energy knowledge house, Rystad Energy, to bring industry insights and analytic detail to our readers in Oil & Gas. As the sector continues to digitise operations on a project and company basis, this high-level monthly data aims to provide key information in context from an industrywide perspective and demonstrate the technology available for those seeking deeper insights to enhance strategic planning and development.

Offshore Rig Market Analysis Contract backlog

www.ogvenergy.co.uk I November 2020

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Date generated 16 October 2020

UKCS Status Report

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WORLD PROJECTS

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WORLD PROJECTS MAP

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Delfin Midstream has announced that Black & Veatch and Samsung Heavy Industries have completed the FEED for the FLNG vessel which confirms the commercial viability of the project.

In parallel to the FEED, the parties have also developed a Term Sheet for a Lump-Sum, Turnkey Engineering, Procurement, Construction, Integration and Commissioning contract (LSTK EPCIC) as a basis for the development of a fully termed agreement.

NOVEMBER 2020

The EIC delivers high-value market intelligence through its online energy project database, and via a global network of staff to provide qualified regional insight. Along with practical assistance and facilitation services, the EIC’s access to information keeps members one step ahead of the competition in a demanding global marketplace. The EIC is the leading Trade Association providing dedicated services to help members understand, identify and pursue business opportunities globally. The EIC is renowned for excellence in the provision of services that unlock opportunities for its members, helping the supply chain to win business across the globe.

WORLD PROJECTS SPONSORED BY

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USA Delfin LNG US$6.8bn

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VIETNAM Mainstream Renewable Power Ltd US$2bn

SPAIN Greenalia SA US$250mn

USA - Renewable Energy Group Inc US$825mn

MOZAMBIQUE Sasol US$2bn

Mainstream Renewable has announced plans for an up to 1GW offshore wind off the coast of Soc Trang. The project represents the second phase of the 1.4GW Phu Cuong wind farm.

Greenalia has submitted project and environmental planning applications for the development, as well as three other projects - Dunas, Mojo and Cardon. The Guanche development will have a capacity of a 50MW and will be located in waters off the south-eastern coast of Gran Canaria. The project will feature four units of 12.5MW turbines in water depths of 61-92m.

Renewable Energy Group has announced that it plans to expand its REG Geismar Biorefinery in Louisiana by 2023.

The government of Mozambique has approved the revised development plan.

The application for site surveys across the proposed development area was submitted by developers in early July 2020.

www.ogvenergy.co.uk I November 2020

The US$825m expansion project will increase the biorefinery capacity by 0.95 mtpa (250 million gallons annually) to 1.29 mtpa (340 million gallons annually). REG plans to start the project construction in Q4 2021.

The new plan involves using as many existing wells as possible for the integrated development of newly discovered resources in the Inhassoro, Temane, Temane East, Temane Deep as well as Pande Central and Pande East; instead of drilling 13 new wells.

WORLD PROJECTS

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BRAZILPetrobras US$2.3bn

Petrobras has launched tenders for the supply of 24 umbilical termination units (UTAs) and associated equipment which is to be split into two tenders. The operator has also launched a major tender for flexible risers which will also be split into two packages, with the equipment to be used in Marlim I, Marlim II and Itapu projects.

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NORWAY Equinor US$400mn

GREECE Energean US$123mn

TRINIDAD & TOBAGO BP US$300mn

Equinor is preparing to carry out an extensive well plug-andabandonment (P&A) campaign the field ahead of planned decommissioning of field facilities.

The development plan for the field has a capital expenditure budget of US$122.5 million to 2023 (US$103.8 million to 2022).

BP has started the drilling operations for Matapal on 8 October 2020.

Starting in December 2020 Equinor is planning to plug and abandon all 24 of its wells. The work has an estimated duration of 500 days.

The company intends to take a decision on whether to farm down or take final investment decision on the project, subject to market conditions.

Approval of the EIA is still pending.

The Maersk Discoverer has been chartered for the three well campaign. The project is on track to start production in 2022.

Hydrocarbons from Matapal will be transported to the Juniper platform via two 9km flexible flowlines.

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CONTRACT AWARDS

www.ogvenergy.co.uk I November 2020

CONTRACT AWARD

Archer announces two-year contract extension for platform drilling and maintenance services in the UK North Sea Archer has secured a two-year contract extension with a major north sea operator for the provision of platform drilling operations and maintenance services on seven UK North Sea installations.

The extension will commence 1 November 2020 in direct continuation of the current contract. Over the next two years Archer will continue to deliver platform rig drilling operations, maintenance and intervention support activities including where required the provision of Well Services and rental equipment. Furthermore, Archer’s engineering team has been contracted to conduct a rig reactivation and provide brownfield engineering and operation preparational support to the other six assets.

Dag Skindlo, CEO of Archer comments: “We are delighted that our client has elected to continue their contract relationship with Archer. This extension reflects our client’s continued confidence in our ability to maintain safe operations whilst delivering improvements to both the drilling facilities and to the platform drilling and well intervention operations on their assets. This award is testament to the hard work and dedication of our personnel who have been supporting these assets since 2015 and throughout these challenging times. We firmly believe this contract win is a result of Archer’s continual commitment to provide our clients with solutions to improve well delivery, integrity and performance”.

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CONTRACT AWARDS Odfjell Drilling chosen for Breidablikk drilling

A letter of intent has been issued to Odfjell Drilling and the Deepsea Aberdeen rig for drilling of 15 wells for the Breidablikk group, for which the partnership recently submitted the plan for development and operation (PDO).

Drilling is scheduled to start in the spring of 2022, and the campaign is estimated to last until the autumn of 2024.

The agreement includes options for drilling additional nine wells before continuous optionality apply. The estimated value of the fixed part of the agreement is USD 290 million. Additional costs include a number of integrated services, maintenance, modifications, mobilisation and demobilisation.

The contract is estimated to create 200 man-years in Norway connected to the rig, and an additional 20-40 man-years related to support functions.

“We have had excellent cooperation with Odfjell over time, and they have consistently delivered wells safely and efficiently to us by use of the Deepsea Atlantic drilling rig. This time a sister rig with the same technical design will be used and we have high expectations to Deepsea Aberdeen as well. Through this agreement we are enhancing our cooperation with Odfjell based on our good experience with the company, and it will be exciting to develop this further,” says Erik G. Kirkemo, senior vice president of drilling & well operations in Equinor.

“In this contract we have further developed the performance-based compensation system, enabling the supplier to increase their profit per well delivery by completing safe and efficient operations. We regard this as an important step towards reaching our ambition of shifting focus from rate per day to cost per well, a move we believe is important to ensure sustainable costs in the future,” says Equinor’s chief procurement officer Peggy Krantz-Underland.

Deepsea Aberdeen is a semi-submersible 6th generation rig with a dual derrick.

At the end of September, Equinor and its partners submitted the PDO for Breidablikk.

Several contracts have been awarded and Norwegian companies are expected to account for around 70% of the value creation in the development phase. Estimated field recovery is around 200 million barrels and investments will be around NOK 18.6 billion.

All contracts are subject to the authorities’ approval of the PDO. The licence partners in Breidablikk are Equinor (operator), Petoro AS, Vår Energi AS and ConocoPhillips Skandinavia AS.

Seadrill scores extension for West Vela drillship from BP Apart from the offshore driller stating that the value for the firm portion of the contract was expected to be $23.8 million, the company did not provide any additional details regarding the BP extension.

The drillship has been working for BP for a fairly long time. Namely, the West Vela has been under contract with the oil major since November 2013.

The initial deal had a $575,000 day rate plus approximately $44,000 per day as a mobilisation fee paid over the term of the contract and was set to expire in November of 2020. According to information provided

by Bassoe Offshore, the day rate for the extension has dropped substantially to $170,000.

The West Vela is a 6th generation dynamically positioned ultra-deepwater drillship delivered in 2013 by Samsung Heavy Industries in South Korea.

Oil major BP has awarded a new contract for Seadrill Partners’ West Vela drillship for work in the U.S. part of the Gulf of Mexico.

www.ogvenergy.co.uk I November 2020

Seadrill Partners said that the latest extension would keep the West Vela busy with BP until early April 2021.

It is worth reminding that Seadrill Limited sold its ownership of the drillship to Seadrill Partners back in November 2014.

CONTRACT AWARDS Wood secures $75m Mariner contract with Equinor Wood has further strengthened its relationship with Equinor by securing a new contract to support the international energy company’s operations at the Mariner field in the UK Continental Shelf (UKCS).

Wood has entered into a three-year agreement to deliver operations, maintenance, modifications, and offshore services on the Mariner A platform and Mariner B floating storage unit. The agreement, valued at around $75 million, will run for three years from January 2021 through to Q4 2023, with options to extend.

Craig Shanaghey, president of Wood’s operations services business in Europe and Africa, comments: “We are delighted to extend our strong partnership with Equinor to include support for their operations at the pioneering Mariner field.

“Wood has a long-standing track record of partnering with our clients to deliver safe, reliable, and optimised operations in the UKCS, and we look forward to extending that to include Mariner by leveraging our deep operational knowledge, experience, and digital capability.

“Mariner is still in its early years of production and, with Wood’s ambition to realise a digitallyenabled future, we see excellent potential to

explore new opportunities that will promote a lifetime of sustainable and responsible operations at the field.”

Mariner is one of the most innovative offshore developments, supported by new digital solutions and the latest technologies, including automated drilling and digital twin solutions. The Mariner field is Equinor’s first operated development in the UK North Sea.

The contract builds upon Wood’s recent agreements with Equinor on the Kollsnes gas processing facility and Breidablikk tie-back development in Norway, strengthening the company’s position as a key delivery partner in the North Sea. The work will be delivered by Wood’s Aberdeenbased onshore and offshore teams, with support from its global engineering community.

Rig Contract Extension Goes to Maersk Drilling Brunei Shell Petroleum Co. Sdn Bhd. (BSP) has exercised the contract extension option for the jack-up rig Maersk Convincer, Maersk Drilling reported Monday.

BSP’s 602-day duration, commencing in May 2021, will allow the rig to continue operating offshore Brunei Darussalam, Maersk noted in a written statement. The drilling contractor added the 20-month extension continues Maersk Convincer’s current work scope until the end of 2022.

“We’re delighted to firm up this long-term extension for Maersk Convincer which is a confirmation of the strong and productive collaboration that has been established between the customer and the rig team,” remarked Morten

Commencement of Drilling Operations for Jack-up ENERGY ENTICER Northern Offshore is pleased to announce the commencement of drilling operations with Qatargas for the GustoMSC CJ50 jackup unit, "Energy Enticer". The Energy Enticer had a safe and successful mobilisation to Qatar Petroleum's North Field in early September 2020 despite recent global industry challenges.

The Energy Enticer is the first of three drilling units to commence long-term contracts with Qatargas on behalf of Qatar Petroleum.

Chairman and CEO Dr. Yuanhui Sun stated, "We are very proud to announce this significant milestone in the history of Northern Offshore.

The superior level of commitment shared by our customer, Qatar Petroleum, and Northern Offshore's rig-based and onshore teams has allowed us to successfully overcome the uncertainty and operational challenges from Covid-19 and focus on delivering the first of our four high specification new build jack-ups into the Middle East region."

Kelstrup, Maersk Drilling’s chief operating officer, in a written statement.

Maersk Drilling noted the Baker Pacific Class 375 cantilever jack-up is operating on the Seria field offshore Brunei Darussalam. The firm also pointed out the extension has a firm contract value of approximately US$47 million, excluding a potential performance bonus.

“The rig has again and again delivered brilliant operational excellence for BSP, including a strong focus on safety and successful efforts to reduce fuel consumption and thereby limit the rig’s carbon footprint,” continued Kelstrup. “We look forward to continuing this outstanding partnership.”

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REGIONAL REVIEWS

By Tsvetana Paraskova

MIDDLE Energy Review EAST

OPEC warned of a fragile economic growth recovery in the near term and pledged to be proactive in ensuring oil market stability, while countries and companies in the Middle East announced new contracts, project start-ups, and investments in oil and gas—these were the highlights of Middle East’s oil and gas scene over the past few weeks.

Global Recovery from COVID-19 is Fragile

OPEC+ Demands Full Compliance with Quotas At the meeting of the Joint Ministerial Monitoring Committee (JMMC) on 19 October, the panel stressed the importance of all members of the OPEC+ pact complying with their oil production quotas.

OPEC warned in its Monthly Oil Market Report for October that economic recovery around the world would likely stall in the latter part of 2020 and early next year.

The organisation cut its annual demand growth forecast for 2021 by 80,000 bpd to 6.5 million bpd.

“While the 3Q20 recovery in some economies was impressive, the near-term trend remains fragile, amid a variety of ongoing uncertainties, especially the nearterm trajectory of COVID-19. As this uncertainty looms large, amid a globally strong rise in infections, it is not expected that the considerable recovery in 3Q20 will continue into 4Q20 and in 2021,” OPEC said in its closely-watched report.

The cartel, however, will look to ensure that oil prices will not tank again as they did earlier this year, OPEC Secretary General Mohammad Barkindo said in the middle of October, just before the organisation was preparing to discuss the situation on the global oil market at its regular monthly meetings.

Opening the technical panel of the OPEC+ group, Barkindo said: “The dark clouds of this pandemic continue to hang over us. In some countries, a second wave is already here, compounding both the human tragedy and economic uncertainty.”

The worst of the crisis is behind us, but dialogue and cooperation are needed to ensure a stable and more resilient market, OPEC’s head noted.

www.ogvenergy.co.uk I November 2020

The worst of the crisis is behind us, but dialogue and cooperation are needed to ensure a stable and more resilient market, OPEC’s head noted.

“The Committee reaffirmed the commitments of all participating countries to achieve full conformity and make up for any shortfalls under compensation plans presented to the Committee for an extended period through December 2020. In this manner, all participating countries were encouraged to increase their efforts to compensate for overproduced volumes in order to achieve the objective of market rebalancing and avoid undue delay in the process,” OPEC said.

The JMMC panel also admitted that it sees slowed economic recovery due to the resurgence of COVID-19 cases in major economies, particularly in the Americas, Asia, and Europe.

“The Committee reminded all participating countries of the necessity to be vigilant and proactive given the precarious market conditions and prospects,” OPEC noted.

The co-chair of the committee, Russia’s Energy Minister Alexander Novak, said that OPEC+ pact members had focused on results and shown commitment to the common cause. Still, the market continues to face many uncertainties, Novak said, adding that the coronavirus has hit all sectors of the economy, including the oil and gas industry, where investments this year are expected to drop by 18-20%.

In a sign of continued communication between the heads of the two leaders of the OPEC+ pact, Russian President Vladimir Putin and Saudi Arabia’s Crown Prince Mohammed

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Middle East bin Salman held telephone conversations in October to discuss the progress of the agreement and the situation on the oil market.

“Both sides stressed again their readiness to continue close coordination in this area in the interests of maintaining stability in the global fuel market,” the Kremlin said in a statement.

Saudi Arabia is preparing for oil prices at around $50 a barrel for the next three years, according to estimates from Goldman Sachs, which has analysed the preliminary Saudi budget and fiscal plans for the period 2020-2023.

Oil & Gas Deals and Investments in the Middle East Despite the global demand shock in natural gas consumption, committed gas investments in the Middle East and North Africa (MENA) region have held steady compared to last year, the Arab Petroleum Investments Corporation (APICORP), said in a report in October. Planned investments rose by 29% to reach US$126 billion, mainly due to the strong ongoing regional gas drive for cleaner power generation and improved monetisation as a feedstock for the industrial and petrochemicals sectors.

The share of government investments in committed and planned gas projects stands at 92%, and is higher than the 72% share in the petrochemicals sector.

“The decrease in gas demand has put fiscal pressures on government and private sectors alike, and we expect a few committed projects to continue facing strong headwinds in terms of payments, supply chain issues and potential project delays. Overcoming these challenges will undoubtedly require strong policy support from governments, as well as enhanced collaboration between the private and public sector,” said APICORP’s chief executive officer Ahmed Ali Attiga.

In the United Arab Emirates (UAE), the Abu Dhabi National Oil Company (ADNOC) said its trading unit, ADNOC Trading, had started derivatives trading as a direct market participant in a major milestone for the company aiming to become a global trader.

ADNOC also announced in early October the launch of AIQ, its Artificial Intelligence (AI) joint venture company with Abu Dhabi-based AI and cloud computing company Group 42. The joint venture company will focus on developing and commercialising AI products and applications for the oil and gas industry.

“This partnership model allows ADNOC to develop AI solutions and applications in a cost-efficient way and strengthens Abu Dhabi’s and our nation’s position as a global hub for AI and technology driven industrial growth,” said Sultan Al Jaber, Minister of Industry and Advanced Technology and ADNOC Group CEO. A week later, Al Jaber reiterated ADNOC’s focus on cost optimisation, expansion in the downstream, and strategic partnerships.

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“Going forward, we will continue to focus on developing our upstream resources and expanding our downstream footprint here in the UAE, while maximising value through creative partnerships. In addition, we are further strengthening our marketing and trading capabilities.

ADNOC said its trading unit, ADNOC Trading, had started derivatives trading as a direct market participant in a major milestone for the company aiming to become a global trader.

Last month we completed our first derivatives trade, marking the beginning of a new era for ADNOC as an active trader,” Al Jaber said at the Energy Intelligence leadership dialogue.

Oman signed in early October a new Exploration and Production Sharing Agreement (EPSA) with Sweden’s Maha Energy to explore and develop the concession Block 70. Under the agreement, the company will obtain geological and geophysical studies, reprocess 3D seismic, and drill appraisal and pilot wells to evaluate and produce heavy oil in the Mafraq field in the Block.

“To be allowed an opportunity to explore and develop the Mafraq oil field is an exceptional opportunity to add value to Maha and the people of Oman. The Mafraq oil field contains significant amounts of oil and previous and extensive pump tests have proven the productivity of the field,” Jonas Lindvall, President and CEO of Maha, said. bp has started gas production at the Ghazeer field in the Omani desert ahead of schedule, the UK-based supermajor said on 12 October. With an estimated 10.5 trillion cubic feet of recoverable gas resources, the block has the capacity to deliver around 35% of Oman’s total gas demand, according to bp.

“When we introduced our plans to reinvent bp, we were clear that to deliver them, we have to perform as we transform. There are few better examples of how we are doing just that than Ghazeer. This project has been delivered with capital discipline four months early, wells are being drilled in record times and, importantly, safety performance has been excellent,” bp chief executive Bernard Looney said.

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REGIONAL REVIEWS

By Tsvetana Paraskova

Europe

Energy Review

Europe’s energy sector news over the past month featured an oil workers’ strike in Norway, a plan to make the UK a world leader in green energy, strategy updates from oil majors, and a lot of renewable energy deals.

Oil & Gas France’s oil and gas major Total confirmed its ambition to get to Net Zero by 2050 and reduce emissions. Total aims to reduce the Scope 3 emissions of its European customers by 30%, in absolute value, by 2030, the group said in its Strategy & Outlook. The company will grow energy production by one third over the next decade, with half of that growth coming from LNG and half from electricity, predominantly renewables. Total will boost investments in renewables and electricity to US$3 billion from US$2 billion per year representing more than 20% of capital investments. The dividend of Total is supported at an oil price of US$40 a barrel, it said.

Norway’s Equinor and its licence partners Petoro and Wellesley Petroleum have found oil and gas in the Swisher prospect close to the Fram field in the North Sea. Recoverable resources are estimated at 13-38 million barrels of oil equivalent.

Equinor also decided to develop the Breidablikk field in the North Sea together with its partners, with expected production from the field at about 200 million barrels. The development concept chosen for the Breidablikk field is subsea development with 23 oil producing wells from four subsea templates that are controlled from Grane.

“Breidablikk will contribute significantly to maintaining profitable production in one of our core areas on the NCS,” said Arne Sigve Nylund, Equinor’s executive vice president for Development and Production Norway.

While Equinor was submitting development plans for new oil fields offshore Norway, it had to shut down four fields in the North Sea, due to an oil workers’ strike over pay that went on for ten days in October. Equinor warned that if the strike extended after the second week of October, it could force the closure of the giant Johan Sverdrup oil field in the North Sea due to the scheduled rotation of personnel as there would not be sufficient capacity and competence in key operational functions at Johan Sverdrup.

Equinor and the oil market didn’t have to see how a shutdown at Johan Sverdrup would affect Norwegian oil production because after ten days of strike, trade union Lederne and the Norwegian producers reached an agreement over offshore workers’ pay and the strike was called off.

Meanwhile, Equinor warned that the pandemic and the weakened Norwegian currency, the krone, pushed up costs for projects under development, postponing the start-up of some projects.

Renewables Staying with Equinor, the Norwegian firm announced the start of construction on the world’s largest floating offshore wind farm Hywind Tampen. The project will be the first floating offshore wind project to supply renewable power for oil and gas installations.

The wind farm with a total capacity of 88 MW is expected to cover about 35% of the annual power needs on five platforms—Snorre A and B and Gullfaks A, B, and C. In the UK, Equinor, together with eleven other companies and organisations, submitted in early October a joint proposal to create a lowcarbon cluster in the UK’s largest and most carbon-intensive industrial region, the Humber.

Just a day before this announcement, UK Prime Minister Boris Johnson set out new plans to make the UK a world leader in green energy.

The UK will make available £160 million to upgrade ports and infrastructure across communities like in Teesside and Humber in Northern England, Scotland, and Wales to significantly boost UK offshore wind capacity, which is already the largest in the world and currently meets 10% of UK electricity demand. The investment is expected to create some 2,000 construction jobs and enable the sector to support up to 60,000 jobs directly and indirectly by 2030 in ports, factories, and the supply chains. Offshore wind is expected to produce more than enough electricity to power every home in the country by 2030.

“Now, as we build back better we must build back greener. So we are committing to new ambitious targets and investment into wind power to accelerate our progress towards net zero emissions by 2050,” Johnson said.

Johan Sverdrup oil field credit: Equinor

www.ogvenergy.co.uk I November 2020

Developing skills and supply chain capabilities will be critical if the UK is to reach its climate ambitions, OGUK, the leading representative body for the UK’s offshore oil and gas industry, said, commenting on the plan.

Europe

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building back better, and here at bp we’re excited to get started.”

The Port of Great Yarmouth, with more than 50 years’ experience in delivering major offshore projects, is ready to support Johnson’s pledge to power every home in the UK with offshore wind energy within a decade, Peel Ports, the owner of the port, said.

The Solar Trade Association (STA) urged the UK to show similar ambitions in the solar power sector.

“What we need to see in that strategy is the same level of ambition for solar and battery storage as there has been for wind. Britain needs to triple its solar capacity in the next decade in order to get on track for net zero,” STA Chief Executive Chris Hewett said.

Meanwhile, The Crown Estate awarded Agreements for Lease (AfL) to six proposed offshore wind project extensions offshore England and Wales for projects, which together have the potential to deliver 2.8 GW of new capacity.

“With the essential expertise to power the green recovery and help the UK meet its climate ambitions, the UK’s changing offshore oil and gas industry is committed to making a positive contribution,” OGUK Chief Executive Deirdre Michie said.

“A green recovery with renewables at its heart will be good for consumers and jobs, as well as helping to meet our 2050 net zero emissions target. Support for new floating wind projects will ensure the UK stays at the forefront of global innovation in renewables, and provides new opportunities in the low carbon transition,” RenewableUK’s Chief Executive Hugh McNeal said.

The Offshore Wind Industry Council (OWIC) also welcomed the UK plan, with industry chair Benj Sykes saying: “Our global leadership in offshore wind, coupled with new support for investment in ports, will help unlock the huge opportunity for the UK to build a world-leading, competitive supply chain.”

bp Chargemaster was awarded in early October the UK’s largest ever EV infrastructure contract, worth up to £21 million, by Police Scotland to supply electric vehicle (EV) charging infrastructure across its estates.

In the UK, Equinor, together with eleven other companies and organisations, submitted in early October a joint proposal to create a lowcarbon cluster in the UK’s largest and most carbonintensive industrial region, the Humber.

Scottish Renewables Chief Executive Claire Mack said: “All parts of the UK can and should benefit from the development of this resource and the renewable energy industry in Scotland looks forward to working alongside government to deliver jobs, investment and innovation as we move towards our ambitious net-zero targets.”

Companies also welcomed the plans. Duncan Clark, Head of UK Region for Ørsted, said that it would “unlock huge opportunities for world class UK supply chain companies, both domestically and overseas, to market the skills and innovative technologies that have been fostered in the UK offshore wind industry.”

Bernard Looney, chief executive of bp, said: “I agree with Boris Johnson - Teesside and the Humber are ideally-placed for the vital expansion of the UK’s offshore wind industry – and central to the country’s aspirations to lead in both carbon capture and storage and hydrogen. Building back greener means

Together with unveiling its future strategy and reaffirming its Net Zero goals, France’s major Total has made several announcements about low-carbon energy deals in recent weeks.

Total is buying ‘Blue Point London’ from the Bolloré Group, taking over the management and operation of Source London, the largest EV charging network citywide, which includes more than 1,600 on-street charge points.

The French firm will also convert its Grandpuits refinery at Seine-et-Marne into a zero-crude platform producing biofuels and bioplastics by 2024. Total signed an agreement with Spanish developer Ignis to develop 3.3 GW of solar projects located close to Madrid and Andalusia.

This brings Total’s portfolio to more than 5 GW of solar projects under development in Spain by 2025. The company also became a 20% shareholder in the Eolmed floating wind farm pilot project on France’s Mediterranean coast.

In Italy, Eni and the Polytechnic University of Turin launched a joint research laboratory to explore innovation in the renewable marine energy sector.

The Crown Estate awarded Agreements for Lease (AfL) to six proposed offshore wind project extensions offshore England and Wales for projects, which together have the potential to deliver 2.8 GW of new capacity.

“Our goal is to optimise existing technologies to make them even more efficient, competitive and therefore accelerate the industrialisation process of marine energies,” Eni’s CEO Claudio Descalzi said.

Maersk Supply Service and Ørsted will cooperate in testing a proto-type buoy that will act as both a safe mooring point and a charging station for vessels, potentially displacing a significant amount of marine fuel with green electricity. Ørsted has also joined forces with world leading fertiliser company Yara to develop a pioneering project in the Netherlands, aimed at replacing fossil hydrogen with renewable hydrogen in the production of ammonia.

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U.S.

By Loren Steffy

The COVID-19 Pandemic is Shaking Up Energy Markets in the Western Hemisphere

The COVID-19 pandemic may be doing what persistently low oil prices couldn’t—sparking the long-awaited merger mania in the American Oil Patch.

In late October, ConocoPhillips said it would buy Concho Resources in an all-stock deal worth $9.7 billion, making it the largest shale deal since the pandemic began. Like other majors, ConocoPhillips wants to strengthen its position in the prolific Permian Basin of West Texas.

Based on crude output, the deal will make it one of the dominant players in the region, along with Chevron and Occidental Petroleum, which acquired Anadarko Petroleum last year.

How many more deals will follow, however, remains uncertain. A recent report by the consulting firm Deloitte found that only about one quarter of all U.S. shale operators were attractive takeover targets based on their financial and operational strength.

Those goals have caught the attention of investors outside the region as well. The U.S. Department of Commerce has ranked Brazil, Chile, and Mexico among the world’s top markets for U.S. firms and exporters of renewable energy and energy efficiency technologies.

Many U.S. operators have amassed too much debt during the shale boom or have returns that are too poor to justify a transaction. Others overpaid for unproven assets during the boom, and now find those properties unprofitable at lower prices.

Unlike in North America, where renewables are still heavily subsidised, the increased scale of technologies such as biomass, hydroelectric and wind power in Latin America allows them to compete on price with conventional fuel sources, according to the International Renewable Energy Association.

Shale drillers have generated about $300 billion in negative free cash flow during the past decade, Deloitte found, and the Dallas law firm Haynes & Boone said almost 250 companies have filed bankruptcy since 2015, representing $175 billion in debt.

A few days after ConocoPhillips announced its bid for Concho, two other big independents in The industry’s deteriorating finances have also the Permian, Pioneer Natural Resources and affected employment. Deloitte found that more Parker Energy announced they would merge in than 107,000 jobs were lost between March a $4.5 billion all-stock deal. By acquiring and August—the fastest rate in the Parsley, Pioneer hopes to solidify its industry’s history. The consulting position among the the Permian’s firm predicted that even if prices heavy hitters. Scale is the key stayed at $45 a barrel in the to survival as the industry U.S. through the end of next Shale drillers have wrestles with low demand year, 70% of the jobs that from the pandemic and a generated about have been lost may not shift away from fossil fuels, come back anytime soon $300 billion in CEO Scott Sheffield told The because the scale of the Wall Street Journal. negative free cash layoffs has damaged the flow during the past industry’s reputation as a The deal is unusual for the reliable employer. family connections. Scott

decade,

Sheffield’s son, Bryan, is Parsley’s executive chairman. Parsley is named for Bryan’s maternal grandfather (and Scott’s father-in-law) Joe Parsley, a legend in the Texas oil industry. Parsley and geologist Howard Parker formed Parker & Parsley Petroleum in Midland in 1962. It later took over another legendary company, Boone Pickens’ Mesa Inc., and changed its name to Pioneer.

Bryan started his own company in Austin and named it for his grandfather, and the company grew quickly, making Bryan, at 38, one of the youngest billionaires in the oil industry. (Concho’s founder, Tim Leach, was a former Parker & Parsley executive who decided to stay in Midland when the company moved to the Dallas suburb of Irving after the Mesa deal.) Neither Scott nor Bryan were allowed to participate in deal negotiations, the companies said.

The two transactions less than a week apart come after Chevron completed its acquisition of Noble Energy earlier in the month and Devon Energy said it would buy Permian operator WPX Energy.

www.ogvenergy.co.uk I November 2020

The mergers of shale drillers weren’t enough to woo back investors who had already abandoned the sector last year because of poor returns. Increasingly, their attention-and their money-is drawn to renewables.

This is especially true in Latin America, where during the past few months, deal activity has surged—from a relatively small base—because of renewable energy investments.

Some of the biggest deals were interregional, with Colombia’s Interconexion Electrica SA (ISA) acquiring Peru’s Orazul Energy Group, and Repsol Butano Chile purchasing windenergy subsidiary Cabo Leones III from Grupo Ibereolica Renovables.

One of the drivers is policy. Governments in the region are focused on meeting ambitious targets for renewable energy. In September 2019, Latin American countries set a collective target of 70% renewable energy use by 2030, more than double the goals set by the European Union.

In Argentina, costs have fallen to an average of 4 cents per kilowatt hour for wind power, and in Brazil, solar is just 2 cents.

The gains in renewables are getting an added boost from policymakers and investors who see the pandemic as a means for accelerating the move away from fossil fuels. The souring North American market for traditional oil and gas is also contributing. Despite the late October deals among shale players, many investors have moved on.

In addition, advances in energy storage is creating new competition among traditional and alternative energy resources. Renewables now can provide greater stability and better competition when it’s time to replace coal generation or aging natural gas plants.

The one exception in the region is Mexico, where the government has put a halt to most new energy projects under development. In May, it increased its control over the country’s electricity market, which affected 44 renewable projects valued at more than $6 billion.

Mexico’s Energy Ministry said falling demand from COVID-19 lockdowns has raised the need for a more “reliable and continuous” power, but energy companies say the government is once again favouring Mexico’s state-owned electricity utility over private developers. Of the projects the government still supports, most are fossil fuel based. If it continues on its current course, Mexico will be one of the few countries in the region in which renewables and related storage technology is unlikely to play a major role in energy development in the near future.

After years of policymakers, industry analysts and investors calling for change, the global pandemic seems to be remaking the energy markets in the Western Hemisphere, from the North American Oil Patch to the greening of the South.

AUSTRALIA

“The View from Down Under”

By Andy Hogan

MEMBER'S FEED

DQ Intel: Hilcorp Alaska are planning just now to drill 3-5 wells summer 2022 in Alaska. Potential prospect locations shortlisted are Blackbill, Steller & Tetra. Water depths 150-300ft.

Aberdeenshire start-up company, Legasea, have won the award for Best Energy Industry Environmental Service Provider 2020, making this their second award since establishing the company 18 months ago.

Kevin Buchan, Managing Director of Aberdeen headquartered energy logistics provider Petrasco, has joined respected international business network, GlobalScot.

G’day from Perth!

As with the rest of the planet, COVID has had a massive impact on the ANZ region, up to now Australia and New Zealand have done very well in terms of low infection numbers, however we are watching events unfold in Melbourne with concern.

Onshore and Offshore rig activity has taken a severe blow, 2020 is pretty much a write off. Rig count had been slowly recovering from the low point early in 2017 when just 2 rigs were active off ANZ coasts, forecasts from end 2019 showed up to 8 MODUs working by Q3 2020. That has now been reduced to between 2 to 3 units.

There is a possibility that ANZ offshore rig count could get up to 7 active units by mid-2021 with the potential for double figures to be reached by mid-2022.

As with everything else, much will depend on all us playing our part in preventing the virus spreading.

Working in the oilfield requires, in addition to a strong sense of humour, much resilience and this is proving to be the case with many operators and their business partners at advanced stages of planning to resume operations from Q3 this year and into 2021.

One of the jackups stacked over Q2 due to COVID has resumed operations off Victoria and a supermajor is forging ahead with plans to drill a key exploration well off the NW coast starting in October.

Platform drilling is taking place in New Zealand and there are signs of appetite for a MODU to return there over the second half of 2021.

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“The View from Down Under” is brought to you by: Networked Energy Consulting Pty Ltd, based in Perth, WA, Australia

Join the OGV Community and take part in our third monthly forum on the theme of "Digital Transformation in Energy" .

Our third monthly forum will be on November 26th at 2pm and will be chaired by Jared Owen - Digital & Entrepreneurship Director for Opportunity North East and sponsored by Code Clan.

We will be discussing themes that explore how the Energy sector is embracing digital transformation and how it can do more to prepare the next generation of talent.

OVER THE LAST MONTH WE HAVE SEEN A NUMBER OF NEW SIGN-UPS TO THE OGV COMMUNITY

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DIGITAL TRANSFORMATION Actions speak louder than words We’ve been on a mission for the last five years to put those claims to the test, to prove, beyond doubt, that we can reduce costs, and create both operational efficiencies and safer working environments.

MAKING DIGITALISATION THE NORM, NOT THE NOVELTY

Our efforts have not been in vain. Over the last 16 months AS-TEG™ has been successfully rolled out across 13 offshore production platforms internationally.

Major Operators and asset owners including Repsol Sinopec Resources UK, Neptune Energy, BP, Stena Drilling, Bumi Armada UK and Modec have placed our AS-TEG service at the core of their digital transformation strategy.

It’s an astute move – the costs are a fraction of what could be required further down the line when equipment fails to fit, shutdowns run on past their schedule, and production losses rack up.

Here’s a snapshot of how our digitally enabling AS-TEG™ platform helped our customers complete projects more quickly, more safely and at a vastly lower cost than ever seen before.

Despite being a generally conservative industry, two downturns and a pandemic have pushed the oil and gas sector to embrace new digital technology.

As our assets age, with some now going beyond the original design lifespan, they will only naturally require more attention. This is putting increased pressure on operators to react more efficiently, and most importantly, ensure the safety of the workforce, all while sustaining a profitable operation.

Enhanced reliability combined with faster project delivery Leading up to a critical 100-day shutdown, the operator made the decision to significantly increase the workload by moving a large volume of next year’s repair campaign into this year. As Eserv’s AS-TEG™ digital twin solution was already in place, our client was able to more than double the workload for the planned shutdown by utilising existing data that was retained within the AS-TEG™ digital twin, without the burden of further visits to site.

AS-TEG™ enabled 6 different engineering and integrity contractors, used and lead by the operator, to collaborate and execute 34 repair orders and 5 medium-to-large piping and structural engineering modifications.

Within 10 months the AS-TEG™ platform tracked a survey cost-saving of over £230,000, and total manpower days offshore were reduced by 91.

The shutdown was complete and delivered to plan, with zero failures-to-fit.

The operator stated that without this technology in place, the interruption of COVID-19 would have rendered it impossible to keep to the 100-day shutdown plan.

Mixed reality 3D data to identify potential onsite technical constraints.

It’s now all about working leaner and smarter, together. New business models which build operational resilience and sharpen the tools of business continuity. Digitalisation is now being recognised as the key to the offshore oil and gas industry and the energy industry’s future.

Here at Eserv, this isn’t news to us. We’ve been developing and honing our data-driven approach for the past 5 years.

Our in-house team of engineers, data metrologists and technology developers work closely to deliver not only digital applications, but also the industry know-how to transform technology into tangible value. We call it AS-TEG™ - As-built Integrity.

www.ogvenergy.co.uk I November 2020

Desktop analysis mapping out material loss over the observable surface of pressure equipment.

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Integrity advantage The efficient use of data can significantly cut the downtime accumulated during onsite visual inspections. We recently proved this during vessel inspection for a major North-Sea operator.

Eserv was able to generate an inspection report, including the measurement of the average material loss across a pitted area of the pressure equipment, leveraging accurate 3D visual data with desktop data analytics.

Eserv’s rapid 3D visual data capture methods provide a fast, accurate, objective, and simplified approach for measuring the surface topology of pressure equipment. Analysis of the data and comparison with as-built design models provides a means of mapping out material loss over the observable surface of pressure equipment.

This process is highly efficient and scalable across an entire asset, enabling both maximum and average material loss on a component to be determined.

Decommissioning advantage With the increasing number of platforms heading into decommissioning phases, we have experienced greater demand for our AS-TEG™ 3D mixed reality capabilities, with customers scoping out a variety of projects, such as flushing.

Data control

The AS-TEG™ digital twin has assisted onshore teams with virtual walk-throughs, construction work-pack preparation and verifying the as-built of P&IDs, thus significantly reducing offshore travel, bed space requirements and onsite footprint.

Enabling the operator to control the data, to control the strategy. New, leaner business models rely on greater flexibility and the freedom of the open market to select the best deal – or service provider - for any given project.

Our service is a game-changer in this respect. We’ve created an independent, vendor neutral and accessible online platform for all as-designed and as-built data – a place where asset lifecycle information can be accessed and used more efficiently for commercial, engineering, integrity, maintenance and safety purposes.

Operational advantage Eserv are integrating with spec-driven 3D models and real-time operational data to equip operations teams with a clearer knowledge and understanding. The ability to troubleshoot equipment remotely vastly reduces the impact of trips on production.

We recently worked with a North Sea operator to carry out an as-built comparison between the old and new HP compressor units for their offshore installation.

By leveraging our latest mixed reality technology, a detailed data capture of the existing and new compressor was carried out at the client’s onshore facility. An as-built point cloud of each unit was produced and overlaid to produce a 3D mix reality verification report, highlighting the 3D and radial errors for all identified connections, giving foresight into any potential installation issues of the existing components.

The successful change-out of the compressor was critical to the asset going back into production. By undertaking the 3D mixed reality analysis, the operator was able to plan ahead to mitigate any on-site discrepancies.

We’ve been on a mission for the last five years to put those claims to the test, to prove, beyond doubt, that we can reduce costs, and create both operational efficiencies and safer working environments.

Future-proofing your business If ever there’s a time when we need to plan for the future, it’s now. Business continuity planning is no longer a nice-to-have, but a must-have. Think of our data exchange solution as a universal filing system – all your data across the life-cycle of an asset is accessible across all disciplines and departments.

We worked with Stena Drilling on a project to achieve just that. Senior Design Engineer, Ross Mungavin, outlines the impact it’s had on streamlining their engineering projects: “We identified a requirement to collate all of our laser scan data which has accumulated over many projects and to have better access to it. The AS-TEG portal solution offered by Eserv allows us to easily view the latest point cloud coverage for each rig and integrate with our 3D CAD models.

This gives us an excellent tool for visualising and communicating designs for rig modifications and upgrades, as well as enabling the use of this visual data for other digitalisation projects.”

We’re making data from disparate sources work better – and harder. And we’re protecting its long-term value by holding data in a universal file format, to allow operators to continuously move with new technology and workflows as they become available.

Eserv has become a leading 3D technology specialist that provides the Oil & Gas industry with a unique data exchange solution between Asset operators and EPC’s.

Find out more at: www.eserv-int.com

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DIGITAL TRANSFORMATION

By Tsvetana Paraskova

Digital Transformation:

The Next Frontier in Oil & Gas Even before the pandemic and the crash in prices, the oil and gas industry had started to recognise that digitalisation would be the next big transformation in the sector notorious for its boom-and-bust cycles.

Companies had started to adopt various innovative digital solutions such as virtual reality, data analytics, and predictive maintenance analytics to boost efficiency and reduce costs.

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"“The COVID-19 pandemic has accelerated the timeline for some digital technology adoption from five years to three months...”

"The cost savings digital can deliver is crucial for survival.."

his year’s COVID-19 crisis made digitalisation efforts even more urgent, from work-from-home for many office staff to remote monitoring of oil and gas infrastructure where possible. The oil and gas industry is now more than ever convinced that it needs to invest in technology and in upskilling the workforce and hiring digital-savvy talent, to survive the current downturn, recent surveys showed.

Some oil and gas majors, especially in Europe, pledge to focus on low-carbon energy investments in the future, seeing the energy transition as the major transformation and challenge for the industry. But virtually all companies in the sector have scaled up technology deployment in recent years and all see digital transformation as part of the future transformation of oil and gas, as well as a means to remain relevant in the energy transition.

COVID-19 Has Made Digitalisation Drive More Urgent The coronavirus crisis and the downturn in oil and gas has made digitalisation efforts more urgent than before the pandemic, most oil and gas executives say in a recent survey by EY. “The COVID-19 pandemic has accelerated the timeline for some digital technology adoption from five years to three months,” Andy Brogan, EY Global Oil & Gas Leader said in a statement.

“The cost savings digital can deliver is critical for survival in today’s low-price environment, as oil and gas companies look

www.ogvenergy.co.uk I November 2020

to gain greater operational efficiencies and drive productivity across the value chain. However, to capture the full value of these investments, oil and gas companies need the skills to harness and use the technology to its maximum potential,” Brogan noted.

According to the survey, carried out in June, 90% of oil and gas executives agree that investment in technology and workforce are essential to surviving current market conditions. A total of 58% of executives said the pandemic has made investing in digital technology more urgent, with a majority planning to invest a great deal (29%) or moderate amount (51%) relative to their total budget.

The top 5 digital technologies currently in use within oil and gas companies are remote monitoring, used by 93% of firms, mobile platforms and apps with 92%, cloud computing – 90%, operational technology - 89%, and advanced analytics currently used by 85% of companies.

An overwhelming 92% of executives agreed their organisation would have to change the way it operates coming out of the current downturn, according to EY’s survey. A total of 43% identified the increasing availability of big data analytics and insights as one of the top three trends that will positively impact their company’s business growth in the next three years.

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The oil and gas industry will face stiff competition from other sectors in attracting data science talent, especially considering the young people’s negative perception of the fossil fuels industry, according to Tim Haskell, US Oil & Gas People Advisory Services Leader at EY US. “Oil and gas will encounter stiff competition for talent and will have to overcome negative perceptions among younger generations who tend to favour careers in technology and other industries.

This makes reskilling and upskilling even more critical for oil and gas companies,” Haskell says.

Still, digitalisation, combined with net-zero ambitions of some energy companies, could attract graduates to the industry, Deloitte said in a report in early October. The future of work in oil, gas, and chemicals will be defined by people and transformation, including digital transformation and remote working, Deloitte said.

“While extremely challenging, this downturn presents an opportunity for companies to reposition. This is the time for strategists to make bold choices today that affect the work of tomorrow; and to adopt redesigned, cyber-physical teams and embrace a digital workplace culture as a basis for future innovation,” Kate Hardin, executive director, Deloitte Research Center for Energy & Industrials, Deloitte Services, said in a statement.

Digital Maturity in the UK oil & gas sector In a recent report, UKCS Data & Digital Maturity Survey 2020, OGUK and its partners in the survey found that the oil and gas industry is still relatively immature in its digital transformation journey, based on the age of digital transformation programmes.

Although the value of technologies is widely recognised, and the digital journey is well underway for most, 73% of practitioners say they are yet to see a positive impact, according to the survey.

Skills Gap Could Be A Hurdle To Digital Transformation

"Oil and gas will encounter stiff competition for talent and will have to overcome negative perceptions..."

The key challenge to a digital oil and gas company that would successfully transform through technology and emerge stronger from the crisis appears to be a skills gap.

A significant share of executives say in EY’s survey that their company does not have the skills necessary to realise the technology’s investment value.

According to the survey, nearly half, or 46% of companies, on average, do not have the skills within their current workforce to realise the investment on their adopted technologies. Oil and gas firms also face a

lack of maturity in many skills in technologies they have identified as critical — on average, the gap between importance and maturity is 36%, EY’s survey showed.

“It’s not enough to simply spend more on digital technology. Oil and gas companies must also understand where they have knowledge gaps and invest significantly in addressing those. The ability to incorporate an intentional skills strategy into digital implementation plans will be a core driver of value realisation,” said EY. As much as 92% of executives say the ability to reskill workforce quickly will be crucial to digital transformation. Nearly 60% of the workforce needs to be reskilled or upskilled, 43% of the workforce will be reskilled or upskilled, and it will take 10 months to reskill the average worker, according to the survey.

“Although many organisations have many years’ experience in deploying digital technology, full digital transformation requires a holistic approach that also encompasses data, innovation, people and culture,” the report said.

While operational processes have been prioritised for digital investment so far, the low oil prices have now made non-operational, or ‘back office’ process improvement financially important, according to the report.

Organisations need to focus not only on data and technology, but also on innovation and culture, in order to make progress in digital transformation with a largely sceptical workforce, the survey showed.

The digital transformation journey has started, but it is just in the beginning. The pandemic has made it clear that the oil and gas industry needs to accelerate digital transformation and address the skills gap in order to overcome the downturn and stay relevant in the energy transition.

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DIGITAL TRANSFORMATION

RESPECTING THE HIERARCHY OF DATA

By Andy Powrie, CTO, Arnlea Systems

Issue: If we share data, other companies will know what we do

Equipment and people sharing is the norm; so why is data different?

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his is at the heart of every digital transformation conversation had in every Energy business worldwide. If we let suppliers share anonymised data, won’t people work out it’s really us and have a competitive advantage?

It’s the most circular and often frustrating argument because it doesn’t go anywhere. It’s never said explicitly of course; it’s dressed up in all kinds of corporate bland speak but in essence, each oil and gas company believes that it does something unique and that if those things are shared, it will compromise its operational and corporate USPs. Other industries, of course, notably the automotive and aerospace industries, have been benefitting from digital transformation and their suppliers having access to multiple sets of client anonymised data for years, which has improved CAPEX and OPEX and is seen as leading the world in good digital practice.

The energy industry is also a close-knit community and people tend to stay in the industry for life. This means that the workforce is continually switching from one of the Big Six to a smaller player, back to another one of the Big Six and so on. There are a large number of contractors in the industry who one day might be working for Repsol and then a few months down the line, are working for Baker Hughes – and so on. Each business will have its own culture and its own nuances, but people also bring their way of working with them too, so there’s a lot of common ground and crossover in working practices. With highly skilled people rarely leaving this industry, thousands of engineers, inspection teams, health and safety practitioners and commercial managers (to name a few) have a really good insight into how lots of their competitors’ work.

It also means the mindset in the industry doesn’t get shaken up a lot – it can be really hard to break into the industry and introduce new ideas. Aberdeen is like a village and if you didn’t grow up here, that can also be a real challenge, although not impossible if you join the industry young.

www.ogvenergy.co.uk I November 2020

It all boils down to this: everyone wants digital transformation and its benefits, but they don’t want the leading edge, habit changing and mindset changes that come with it.

Companies want the benefits of data analysis, but don’t want any crosssharing of data.

There are a myriad of Joint Ventures in our industry and that’s done to spread risk. JVs inevitably mean a sharing of people, kit and systems. It seems incongruous that in this respect energy companies are prepared to share risk but feel that sharing anonymised data would somehow compromise their businesses.

Sharing intelligence over common parts is rare. It is hard to understand why businesses wouldn’t want to have the ability to understand whether component ‘A’ works better in cold or humid climates; whether business ‘B’ still needs component ‘Y’ because it has a warehouse full of them, while business ‘C’ is going through that component at a rate of knots but can’t access them through the supply chain. This would benefit both businesses and the others involved in data sharing but is currently just the stuff of blogs!

This lack of data sharing and pooled understanding of the life cycle of different resources is creating huge operational inefficiencies for many. They could be resolved cleanly and efficiently - and improve cash flow, productivity and HSEQ - by sharing anonymised data. By having the big picture on equipment and suppliers, the industry would possess compelling information for improved decision making, enhancing the Oil & Gas industry’s overall financial performance and reputation, supporting carbon reduction and other critical challenges the industry also shares collectively.

The Arnlea model – a secure, contemporary solution Arnlea offers an all-encompassing service. Before the pandemic, in seven years at Arnlea, I’d had one enquiry about data security. In 2020, I’ve had at least seven. The whole climate created by the Cambridge Analytica scandal and other data hacks has driven those questions. Our data storage is world-class; we use the same providers as most global banks; and so our security is as good as it gets, but this year is a first as people are starting to think more comprehensively about the value and protection of their corporate data in the hands of their suppliers and partners.

Who handles their data seems a reasonable concern, which can be understood better if we recognise that not all data is equal. Operational data is far less commercially sensitive

Arnlea, the global leader in industrial mobile software for tracking, inspection & maintenance for the global Oil & Gas industry.

Learn more about Intrinsix at: www.arnlea.com

than data pertaining to innovation and discovery, for example. Creating a hierarchy of data that can be shared and data that can’t is an obvious way of determining how to take business forward and having a realistic vision of that hierarchy is also vital.

From our perspective, we have no interest in our clients sharing commercially sensitive data. We’re focused entirely on operational data, which is rarely sensitive because it pertains to which components and pieces of equipment are longer lasting or fail more frequently, which is a matter of productivity and expenditure rather than the price of contracts or the latest oil discovery or technical innovation.

If Oil Company ‘A’ has a piece of equipment that’s failed 15 times in three years and Company ‘B’ has the same equipment with similar failure rates, and both are using it in the North Sea but Companies ‘C’ and ‘D’ use it in the Gulf of Mexico with only four failures in three years between them, that’s operational data that suggests the equipment in question is more suited to warmer waters than the cold climate of offshore Aberdeen. That information is valuable to procurement teams who can decide how to solve this issue and both ‘A’ and ‘B’ may take a different approach; either way it’s valuable to both businesses and will impact their bottom line but isn’t particularly commercially sensitive. You may think businesses A and B would know this independently, but this type of analysis is not always prioritised within individual organisations; whereas their inspection software provider, like Arnlea, would be able to provide this as an added value service if each business permitted anonymised data sharing for their operational data.

Summary It’s time for change, in fact, it’s long overdue.

It’s time for energy businesses to make partners of their suppliers rather than have traditional master/servant relationships and allow their partners to have other partnerships that will also benefit them. In short, this approach means everyone wins. Technology is more powerful when shared than when used in isolation. Data privacy has to be respected but we don’t need a blanket approach to every piece of corporate data. There needs to be an intelligent and diligent approach that respects the hierarchy of the data – operational or commercial - and allows relevant data to be shared as well as protected.

We also need to see the Big Six take that lead and to become pioneers in this area – at the moment, everyone is waiting for someone else to blink first, to the detriment of the industry’s digital transformation ambitions. The big question is, how long will we have to wait – or has the global pandemic started to shift thinking because of the sudden reliance on tech to make daily business life more manageable? Only time will tell, but make no mistake; the clock is ticking…

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AUTOMATED REPORTING analytics, benchmarking and drilling performance a bold move and one placing IDS firmly in the cloud before there really was a cloud to be in. All this at a time when a 14k dial-up modem was state-of-theart and the desk top computer had 640k of RAM.

Building on the move into the world of WITSML and operational state detection, Independent Data Services (IDS) released DPM (Drilling Performance Monitoring) in 2018, re-processing WITSML data to deliver detailed drilling performance KPI’s and benchmarks via on-line dashboards.

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he DPM fully complements the analysis of daily report (‘static’) data by underpinning the DDR narrative with a detailed statistical performance framework. IDS is now recognised as a global market leader in upstream digitalisation, being the first to fully integrate reporting with real-time data to deliver automated reporting, analytics, benchmarking and drilling performance KPI’s from a single service.

IDS DrillNet, the first on-line service, was rolled out in early 2001 to Unocal in Indonesia. With the implementation of the Agile/Scrum development methodology in 2005 there followed an everevolving eco-system of complementary products covering geology (GeoNet), safety (SafeNet), cost (CostNet) and interventions/P&A reporting (ProNet). Geographical expansion into Asia, the Middle East and Europe and the launch of the ‘TourNet’ application in 2009 meant that at the start of 2010, IDS became the first (and still the only) provider of on-line reporting services to both operators and drilling contractors.

Recognising that the large data repository garnered from reporting was in itself a valuable resource, IDS developed ‘Anova’ analytics, a powerful enterprise level analysis tool that mines the IDS database and delivers insights via an extensive range of custom reports and dashboards. Running Anova analytics on a very large IDS in-house dataset, it quickly The history of IDS is one of IDS is now became apparent that much continuous innovation and reporting data was of indifferent recognised as the journey continues to quality, particularly the this day with a corporate a global market manually-entered ‘activities’ commitment to delivering descriptions which, because ACRE (Automated Common leader in upstream they are the source of the NPT Reporting Environment) in digitalisation and ILT narrative, represented a Q1 2021. ACRE is a project measurable loss of value to the to derive all the fundamental data owner and user. Accordingly, reporting components of the drilling IDS set its sights on automating data contractors IADC report and the entry, releasing the first version of its LAR operators DDR from common on-site data (Lean Automated Reporting) service in early 2017. sources to deliver a data-driven ‘single version of LAR combines WITSML data, rig state analysis the truth’ that is shared by the operator and the and a custom report parsing application to deliver drilling contractor. There always has been only a data-driven DDR or IADC report with the absolute one midnight depth and, working alongside Stena minimum of human input.

Drilling and the operator stakeholders, IDS ACRE will deliver it.

Building on the move into the world of WITSML and operational state detection, IDS released IDS has been delivering reporting and analytics DPM (Drilling Performance Monitoring) in 2018, services to the upstream sector since 1995 but re-processing WITSML data to deliver detailed really began its digital transformation journey drilling performance KPI’s and benchmarks via in 1999. At the time, the IDS drilling reporting on-line dashboards. The DPM fully complements application was delivered via floppy disc, each the analysis of daily report (‘static’) data by installation a manual process with site visits underpinning the DDR narrative with a detailed to both rig and office a requirement. Early statistical performance framework. IDS is now experiments with ‘Bulletin Boards, the predecessor recognised as a global market leader in upstream to the web, convinced the IDS founders of the digitalisation, being the first to fully integrate delivery potential of the rapidly emerging ‘dot reporting with real-time data to deliver automated com’ environment of the late ‘90’s. Accordingly, in reporting, analytics, benchmarking and drilling 1999/2000 the entire application was re-written in performance KPI’s from a single service.

PHP and delivered as an end-to-end web solution -

Independent Data Services uses “lean automated reporting” powered by WITSML™ data to improve the speed and accuracy of reports and free up 1–2 hours per day for the costliest people on a rig.

Find out more at: www.idsdatanet.com

02 32

DIGITAL TRANSFORMATION

By Colin Dawson, Digitalisation and Business Transformation, Stena Drilling

An agile transformation STENA DRILLING

‘People & Process’ Eat Technology for Breakfast

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igital business transformation is a diverse and widely documented topic. Thousands of books and technical papers have been written in recent years, covering both successful and failed transformations. With an abundance of literature available, many companies still struggle with the million-dollar question, ‘where to start’.

Many companies view Digital Business Transformation as a venture into ‘next-gen’ technology rather than an evolution of how the business interfaces with technology.

Fundamentally, technology empowers humans with increased performance. This understanding is where the journey began for Stena Drilling.

In Q1 2019, following several challenging years, Contrary to common understanding, Digital the digital landscape within Stena Drilling was Business Transformation is not only about showing signs of ageing. Whilst the company technology, it is also about organisational continued to perform at an operational level, agility. Modern businesses not only exist in a it was evident that inflexible legacy systems state of constant technological change but with distributed across the ecosystem would the right organisational structure and culture eventually start to compromise Stena Drilling’s are able to thrive in it. The Stena Drilling Group ability to implement effective change in the has always been at the forefront of cuttingrequired timescales. Following an internal audit edge technology. This has been reflected in the and restructure, a new functional arm of the quality of the Stena Drilling’ assets, the ability company was established called ‘Digital Business to adapt to change and most importantly, Transformation’. Digitalisation efforts were Stena Drilling’s people. Always keen consolidated and teams eager for change to maintain a market leading were empowered with new skills to position and understanding the enable swift and effective change. need to embrace new and Projects were aligned with clear Modern businesses not innovative ways of working, business goals and connected Stena Drilling decided to to the wider business only exist in a state of consolidate its digitalisation strategy. constant technological efforts. This was done change but with the right to provide a clear road “The most business value map and align existing emerges when projects are organisational structure digitalisation initiatives. aligned with clear business and culture are able to In turn, this would allow a goals, deliver frequently & thrive in it. framework to be established involve the collaboration of from which Stena Drilling Group motivated and empowered people.” could further develop its digital – Agile DSDM ecosystem. The starting point for this forwardthinking approach was to recruit skills which By adopting the Agile DSDM philosophy, this did not already exist in the business and allow enabled all digitalisation initiatives to be assessed formal adoption of agile working practices. independently based on their value to the strategy. This helped to filter out noisy projects “We adopted an Agile transformation focus or projects with limited impact. This also created in 2019. This allows the business to rapidly the opportunity to re-evaluate the digital project engage teams to meet business goals as they management mantra and drive continuous value emerge. Recent fleet upgrades have enabled through Agile delivery. us to leverage the power of data, which in turn is swiftly transforming how we work.”

There is no defined set of steps a company can - Colin Dawson - Digitalisation & Business take to optimise their business with technology.

Transformation Manager.

Each transformation is unique and should be

www.ogvenergy.co.uk I November 2020

treated as such. That said, these eight guiding principles spearheaded the success at Stena Drilling: • • • • • • • •

Be customer-centric, always ensure end users are on the journey with you.

Focus on the business need.

Invest in people. Up-skill & cross-train motivated individuals & teams.

Maximise the value of data. Data is often an under-valued asset. Look after it!

Do not fear failure.

Never compromise quality.

Communicate the vision clearly & regularly.

Demonstrate control.

The Stena Drilling Agile manifesto (similar to the music streaming company Spotify) is focused on continuous learning, simplicity, trust, servant leadership and iterative development. This is manifested inside the Stena Drilling ‘Evolve’ transformation programme.

‘Evolve - Change is good…Transformation is better’ is a transformation programme, focused on iterative value delivery. Deliveries are segmented into 6-month chunks (known as a “Supersprint”) of focused implementation. In Agile, time is fixed, cost is fixed, but what can be delivered within these two parameters is variable.

Stena Drilling has recently concluded Supersprint-2 (SS-2) which ran from MarchAugust 2020. This was a challenging phase of activity for the organisation. Despite these challenges, significant progress was made towards the Digital Transformation strategy with 84% of objectives delivered successfully.

Supersprint-2 consisted of 33 improvement initiatives, of which 28 were successfully implemented with five projects awaiting release inside Q4 2020.

To ensure projects were aligned with business goals, projects were paired with Stena Drillings core values of Care, Innovation & Performance.

This ensured project-level KPIs were aligned with business strategy.

Stena Drilling is one of the world's foremost independent drilling contractors, consisting of 4 ultra-deepwater drillships and 2 semi-submersible rigs.

Find out more at: www.stena-drilling.com

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“Our Agile Transformation strategy is focused on the client first. We look to deliver value to clients through establishing trust and working collaboratively to deliver an innovative, high quality drilling service that aligns with our core values of Care, Innovation & Performance.” Eirik Reinertsen – Chief Commercial Officer

One example of a project in the Care Tribe is an improvement initiative (A3) aimed at digitising how loose lifting equipment is tracked and managed. Starting with the business problem and working outwards, TechX graduate Intebloc were approached who had been working on their ‘RigWare’ solution that could help solve the problem at hand. It is refreshing to see a technology company completely focused on listening to the customer and iteratively developing solutions to solve business problems. The project aligns with the “Safety First” business value driver, in addition to; Increase Automation & Future Enablement.

Another example, of a project came from the Performance Tribe. Data across the operations ecosystem was distributed within legacy silos.

An A3 was submitted to consolidate the data into a single data platform and increase the value that can be generated from data within the ecosystem. Independent Data Services (IDS) were selected to deliver operational performance metrics to the Stena Drilling Azure data platform.

This allows on and offshore teams to collaborate on a single source of truth. Further projects have now been approved to extend the scope for delivery inside Supersprint-3.

Supersprint-3 (SS-3) is now underway. One project to be implemented during Supersprint- 3, is the deployment of the Eserv AS-TEG™ solution to support the Engineering team in managing laser scan data. Other SS-3 projects include, real-time BOP monitoring, energy utilisation efficiency monitoring, software upgrades to improve energy utilisation on key equipment, an improved safety observation system and many more. The customer value generated through both SS-2 & SS-3 is significant.

Fundamentally, the success of Digital Business Transformation within Stena Drilling is not only through new/innovative Digital Technologies. The key is the alignment of projects with clear business goals, empowering people, carefully selecting collaborative partners, and having the resilience to continue delivering value, even when times are tough.

Rig-Ware is delivered on easy to use software accessed through an ATEX Zone 1 tablet.

Management can access all the information and trends through the management portal.

The benefits Rig-Ware offers are a reduction in time spent locating equipment, a more efficient check In/Out process, automated reporting, seamless provision of check lists and reduced 3rd party inspection times.

Instrumental in the development of Rig-Ware has been the high level of customer input through exhaustive field trials. Stena Drilling was the first major offshore player to trial an early version of RigWare on several of its rigs over an extended period.

Feedback from these trials was incorporated into the later Rig-Ware versions and have greatly enhanced the final offering.

INTELLIGENT CRANE & LIFTING TECHNOLOGY Intebloc delivers intelligent crane and lifting technology which connects people, equipment and data.

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ntebloc Ltd, was established to develop a range of technologies to improve safety performance, reduce costs and increase productivity in crane and lifting operations.

Their first product is the revolutionary Rig-Ware system.

Rig-Ware provides improved operational efficiency at the deck crew level, easier management of lifting operations at the supervisory level and access to previously unavailable usage data and trends for decision making. By streamlining the day to day control of lifting equipment, Rig-Ware delivers significant and tangible benefits in the areas of efficiency improvement, cost savings and safety performance.

Ross McLeod, Intebloc CEO: “We are extremely grateful for Stena’s input which has identified a number of improvements we had not previously considered. This feedback and their involvement in the extensive trials is part of our development ethos - “by the user, for the user”.” Stena then went on to be one of the first companies to adopt the system and it is currently being rolled out across their fleet.

Other contracts from major North Sea operators have followed.”

Stena Drilling is also an industrial partner supporting the development of Intebloc’s next product which will greatly improve the safety and productivity of crane operations. This project is part funded by the Oil and Gas Technology Centre (OGTC) and will be launched in 2021.

For further information about Rig-Ware and other Intebloc products visit our website at www.intebloc.com

We improve crane and lifting efficiency - Streamlining your processes; increasing productivity and efficiency; improving safety; delivering cost savings.

Find out more at: www.intebloc.com

DIGITAL TRANSFORMATION

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By Harris Simpson, Lead Auditor, QHSE Aberdeen

BENEFITS of ISO 27001 information security management In the age of digitalisation and stricter regulations on data protection, ISO 27001 may now be more important than ever. We all know about ISO standards, we know the benefits that a Quality, Environmental and/or Health and Safety Management System can bring.

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ttainment of these standards can bring about business improvement and allow for the gaining and retaining of customers. ISO 27001, the Information Security Management System Standard is one of the less well-known management system standards, however, it is the world’s most popular Information Security Management System Standard and possibly the most important standard in place at this time.

ISO 27001 brings many years’ worth of best practise in information security management into one document which can align with any other ISO Management System.

ISO 27001 allows for easy integration of its requirements into existing management systems just as easily as if you are implementing it as a standalone management system. QHSE Aberdeen have been working with a range of clients in a variety of industries from IT Providers to Engineering Production and Maintenance Companies, to develop, implement and maintain their information security management systems. Our consultants have now implemented many ISO 27001 standalone systems as well as integrating the ISO 27001 requirements into current management systems for Quality, Environment and Health and Safety.

Organisations need to ensure that they are holding the data they need to operate effectively whilst balancing the legal requirements on information retention. On top of this organisations must ensure the confidentiality, availability, and integrity of the information that they store. Businesses may need to ensure that their information is confidential so they remain competitive; they need to ensure the integrity of their information to make sound business decisions; and they need to ensure their information is readily available so they can be agile.

Digital transformation creates risks for information.

Garmin was attacked in July 2020, costing a reported multimillion-dollar ransom, reputational damage, customers trust, and a loss of confidence from some of the shareholders. Morrisons Supermarket Chain was the subject of a sizable data breach as an employee with access to large quantities of sensitive data released this information to the wider public. ISO 27001 cannot guarantee protection from cyber-attacks/data leaks, however, a management system that conforms to ISO 27001 can help mitigate the effects of these

www.ogvenergy.co.uk I November 2020

incidents and reduce the likelihood of these attacks being successful.

QHSE Aberdeen will work with your organisation to identify information vulnerabilities and plug them.

QHSE Aberdeen can assist you to demonstrate conformance ISO 27001 and compliance to the legislative requirements.

ISO 27001 can reduce the risk to your organisation in relation to information security prosecutions from the Information Commissioners Office by implementing a concrete framework which will allow you recognise and address relevant information security regulations.

ISO 27001 may give your bottom line an added layer of protection as you will have the evidence to demonstrate that you have taken the steps necessary to ensure the security of your information.

ISO 27001 demonstrates to new and existing customers the commitment your organisation has placed to ensure the security of one of their most important assets, “their information”. As businesses become concerned by the risks associated with poor management of information,

ISO 27001 becomes more important. In the past, Information could be secured by the lock on a filing cabinet, but with digital transformation, information is now being stored electronically and also on the cloud, increasing its vulnerability to threats. Information Security is a key issue to many customers as they look to ensure the confidentiality and integrity whilst its under your control.

ISO 27001 also places importance on the involvement, training, and awareness of employees within your organisation.

Not all data leaks are the result of malicious wrongdoers, information security breaches can also be the result of simple mistakes by employees. ISO 27001 can also help organisation tackle this risk through the participation of various personnel within organisation.

The standard involves employees from all business areas (HR, Sales, Production etc) in the information security process, so that all the information within the organisation will be suitably protected.

Most employees have access to information that you as a business owner/ manager don’t want in the public domain, therefore, you will want all your employees familiar with the information security processes of the business and how they impact on the control of data so you can continue to grow.

As we move in to a digital world, we are seeing many benefits, the flexibility to work effectively from home and the ability to respond to business needs quickly, but we also need to be aware of the risks that arise as a result of this digital world.

QHSE Aberdeen can assist your organisation to identify and address its information security risks and help your business grow by aiding your achievement of ISO 27001, which will allow your customer and suppliers to have greater confidence in your abilities to manage their information securely.

QHSE Aberdeen can help your business with ISO 27001 Information Security Management System development, implementation, certification, and continuous maintenance to provide you with that unique selling point to win and retain customers in this very competitive marketplace.

QHSE ABERDEEN LTD. TEL: 01224 735369 I WWW.QHSEABERDEEN.COM I INFO@QHSEABERDEEN.COM

DIGITAL TRANSFORMATION

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Learning to embrace DIGITAL CHANGE

The Covid pandemic has given people very little option but to join the digital revolution.

From Zoom calls to collaborating and training on the cloud, the way we work has altered permanently.

F

or a digital training company like ours, the opportunities to partner with industry peers and support their transition to online learning are clear. But, what about those employees who are less enthusiastic about the drive to digital?

How do we ensure they still receive the support they need and learn to embrace digital change?

During any digitalisation programme, there will always be people who are highly supportive and keen to deliver the project and those who are equally less enthusiastic and risk

destabilising the initiative. Regular and clear employee engagement regardless of the type of digital initiative is critical to allay concerns and anxieties. Genuinely taking into account all views and working with concerned parties to accommodate their stance, where reasonable, is the most effective way to ensure projects stay on track. This may mean changing how the roll-out is planned, or even adding in new features to encourage engagement.

Push back on change is to be expected.

Research by change management consultancy, Changefirst, suggests that while 54% of an organisation is likely to accept the change a digitalisation project brings 21% are likely to be reluctant with 25% being committed to making the change happen.

Digital training brings with it many benefits, including the ability to train more people more consistently. This can mean that people who were previously getting little to no training can suddenly access a wide library of technical courses.

If a person was happy with the status quo, where they didn’t have to spend any time training, or feels as if they should be exempt, we offer a simple solution of preassessment allowing them to skip the need for any mandatory courses through passing a summary assessment in advance. This can be a win-win solution. It encourages engagement with the digital platform, it can allow experienced personnel to avoid non-essential courses for them, but it can also highlight areas where training is required.

Digitalisation is opening up new possibilities, improved ways of working and increased knowledge sharing at the click of a button.

While the opportunities are exciting for people at the coal face, for some the change can be daunting and organisations and their digital partners have a responsibility to help their people navigate the change together.

This may mean having to make some changes to the solution itself, but that can be the key to digital success.

Norwell Edge provides a comprehensive range of affordable and accessible technical oil and gas training modules built around UK upstream competency guidelines.

Find out more at: www.norwelledge.com

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DIGITAL TRANSFORMATION

PETROFAC

to represent energy sector on new projects task force Petrofac, leading international service provider to the energy industry, has been selected to represent the sector as part of a cross-industry Task Force created to transform project delivery.

North Sea, get the right action, to the right people, ahead of issues occurring.

“Through the use of live dashboards and Petrolytics™, Petrofac is already transforming asset and project data into actionable insights that enhance performance and better predict cost and schedule outcomes for our clients,” said Alex.

“These tools are actively supporting our clients to drive more predictable outcomes, so we are well-versed on how to drive project and operational assurance. We recognise however that not one area of industry has all the answers, and by working with others the energy sector has a fantastic opportunity to further enhance and standardise its approach. That’s important anywhere, but, as dedicated reports from the Oil and Gas Authority attest, in a mature basin like the North Sea, it is vital.”

Stephen Ashley, Digital Solution Centre Manager at the OGTC, commented: “The OGTC recognises that Petrofac is proving to be a leader in the field of project data analytics despite it being a relatively new concept for our industry, and it’s this experience that provides a great fit for the Task Force. We are confident that Alex will prove to be a valuable member of the team, as he will be able to bring both his own, and Petrofac’s, operational and project domain knowledge and experience to the table.”

T

he company was nominated by the Oil and Gas Technology Centre (OGTC) to join the Project Data Analytics Task Force. A collaborative venture made up of Project Management experts from a selection of crossindustry organisations, government bodies and academia, the Task Force will explore the use of data, systems and technology to enhance project delivery.

It will work to establish innovative project management solutions and skills, as well as facilitate access to information and data that will help drive project improvements across all sectors.

Alex Robertson, Petrofac’s Digital Deployment Lead - Projects, is leading the Task Force’s

www.ogvenergy.co.uk I November 2020

Solutions Development workstream. He said: “The aim of the Task Force is to deliver a step change in project performance. Here we have a group of like-minded projects people combining their expertise to accelerate learning and make project outcomes more predictable.

As part of my role, I will be working to ensure that analytics methods, tools, technologies, and solutions are available at scale, to support cross-industry improvement.”

As part of its digitalisation strategy, Petrofac is embedding solutions across the project life cycle to optimise and connect its delivery.

Last year the company launched its own data analytics tool, Petrolytics™, that predicts project and equipment health. The tool’s intelligent dashboards, which have been proven in the

Alex Robertson, Petrofac’s Digital Deployment Lead

Petrofac is a leading international service provider to the energy industry.

We design, build, manage and maintain infrastructure for the energy industries.

Find out more at: www.petrofac.com

DIGITAL TRANSFORMATION PYXIS

MARINE TECHNICAL LIMITS completes first major, fully digitised, remote FPSO inspection campaign

Marine Technical Limits (MTL), a world leader in FPSO inspection, repair, and integrity management services, has completed a remote inspection campaign of all water ballast tanks utilising a fully digitised workflow.

through the use of ROVs in each WBT, reducing the need for any gainful entry to the tanks and significantly reducing inspection time to less than 50%. The integration of PYXIS with the ROV camera enables our naval architect to guide the ROV pilot, ensuring the right data is gathered and improving efficiency of how the inspection is carried out. Further, directly capturing findings into PYXIS avoids the need for onshore review of hours of ROV footage.

Mathew Lewin, Technical Director, said: “PYXIS has been a game changer, both for MTL and, most importantly, our clients. From planning right through to close out, the full workflow is digitised bringing a whole raft of benefits. It is a fantastic system which is really delivering great results.”

The company committed to digitise its integrity management processes back in 2011 as part of its companywide digitalisation initiative. Following year on year growth, while reducing operating costs, this foresight has been fundamental to its success.

The project was made possible thanks to a new milestone release of the firm’s flagship product suite – PYXIS. This enabled the full integration of live ROV and UAV camera feeds to sync directly into the PYXIS Inspector app. First released in 2012, PYXIS is a mature FPSO specific platform which encompasses the full integrity management lifecycle.

Originally conceived to digitise MTL’s class leading paper based workplans, PYXIS has become a significant digitalisation success story for the company, leading the industry.

In contrast MTL’s approach to this project was to have the inspection carried out using a two-man team (ROV pilot & specialist inspector). They performed the inspection

he project has been hailed a huge success delivering significant savings, increased safety and improved efficiency for its client.

Matthew added, “We had the foresight to think differently and saw the advantages of moving to a digitised system many years ago.

“This approach has enabled the complete screening inspection to be carried out more efficiently, safer and with a smaller team, than the traditional approach. This in turn will enable our client to understand their asset better, enabling clear and informed data driven decisions to be made about where to focus valuable resources, through our risk-based integrity management system, and where physical manned intervention is enables really required.

PYXIS complete screening inspection to be carried out more efficiently, safer and with a smaller team.

This most recent achievement represents a step change in executing remote tank inspections.

Traditionally this inspection campaign would have been performed through manned entry, using a team of four or five personnel and a duration of up to a few weeks per tank. The team would also have to spend a significant amount of time out of the tank recording their findings before passing them to the onshore team for review. The use of MTL’s PYXIS inspection tablets reduces reporting time by 40%.

T

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“Although we are working in difficult times, with the global pandemic proving to increase the pressure on offshore bed space, the ageing of hull structures continues regardless. It is important that at MTL we continue to support our clients with innovative and effective technologies – something we have been doing now for more than 15 years.”

Although this campaign saw PYXIS coupled with the use of micro-ROV technology, the same approach could be used with other technologies, such as UAV (drone), crawlers, or even the traditional manned approach. In all cases significant efficiencies in both ‘in tank’ and ‘out of tank’ processing can be realised.

For more information about PYXIS, this scope and perhaps how it could benefit operations please contact MTL, with further details at www.technical-limits.com

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INNOVATION ZONE

"InProcess" application

helping Intertek's clients manage big data

Although big data analytics is a hot topic across all sectors, many companies from banking to pharmaceuticals are only recently beginning to realise the value locked in their data.

It is safe to say that the oil and gas industry are not exempt from this and are no stranger to large amounts of process data. For many years data historians have worked away collecting measurements from instrumentation around oil and gas processes globally. The data is large and complex with many interactions and correlations between variables which are not easily interpreted.

would typically not be considered. However, pressure drop across a compressor is indicative of compressor efficiency which, in turn, has an effect on separator levels.

In refineries, the flow rate of medium gas oil (MGO) is a function of many parameters such as reflux ratios, reboiler heat load and temperature of the feed - all first-order effects.

lnProcess can import large datasets from data historians. It then gives the user an interface, consisting of plots and summary tables, to view this data. To maximise value from this, it is key to understand outliers and 'clean' datasets before additional analysis such as process modelling and optimisation.

However, there are other factors affecting this which would not be directly linked to MGO production such as the temperature of the desalter or the temperature of a slops stream being added to the crude blend. Both have an effect on CDU feed temperature.

lnProcess allows the user to examine the data and visualise any points that may be missing, constant values, faulty sensors and questionable values. Plots can then be used to identify process outliers by looking at combinations of process variables.

Operating Regions lnProcess allows the user to visualise operating regions drawn from snapshots of the combinations of operating variables at a particular time horizon.

Complex Data It is a fact that contained within large historical datasets is valuable information and knowledge that, when coupled with domain expertise, can be used to achieve a variety of benefits including: more efficient maintenance scheduling, improved performance, reduced downtime and maximised margins.

However, the quantity and noise from unrepresentative operations, such as process upsets and malfunctioning instrumentation, creates a challenge to unlocking valuable information that can be used to improve performance.

Our lnProcess application can reduce the complexity of large datasets, offering the user an interface of easily accessible plots and summary tables with trends and correlations.

Features such as missing data, constant values, faulty sensors and questionable values can be analysed through the system.

Intertek lnProcess Our proprietary technology lnProcess is designed to assist our clients in cleansing and ordering historical data to gain valuable information that may positively impact processes and profit.

When analysing data and making decisions based on variables, operations usually focus on first order, i.e. the most obvious, effects.

For example, flow rate into a vessel on a platform is known to have a direct effect on its fluid level, whereas the pressure sensors on a compressor

www.ogvenergy.co.uk I November 2020

Key Process Variables

Functions and Benefits InProcess offers many functions and benefits including: • An advanced data analysis tool to expose the underlying structure of complex datasets • Ability to expose underlying trends and correlations • Create snapshots of process data, showing representations of process operation for specific time horizons • Analyse the whole dataset to show combinatorial effects of process variables • Assess underlying effects on processes •Identify potential problems that could negatively impact margins

Following identification, they can then be correlated to key process variables.

Operating regions can highlight process nuances such as decreasing process unit efficiency, shift changes and changing crude blend composition.

Summary lnProcess takes large datasets, displays their underlying trends and shows the variables which have maximum effect.

It can pick out relationships caused by combinations of variables and other underlying effects as well as first-order relationships.

However, process data is complex, and there are many interactions. Statistical analysis uncovers the underlying combinatorial effects by selecting a target /objective function based on process requirements, for example, maximising flowrate, minimising oily water overboard or maximising the production of diesel.

INNOVATION ZONE SP series technology

Enhanced safety for

The SPSV will fail-safe close when the ESP is switched off, and uplift pressure from above is low, and will open again when the ESP is pumping fluid to surface. It can be opened and closed as many times as required and provides an effective well barrier, being unaffected by lower well pressure. It effectively acts as a fluid loss valve, preventing PMM backspin for additional safety.

retrofitted artificial lift Aberdeen-based Pragma Well Technology has developed an advanced retrofittable safety valve, which enables cable-deployed artificial lift technology, such as electric submersible pumps (ESPs), to be installed with added safety.

T

he “Slim Pump” Safety Valve (SPSV) recently achieved API 14A qualification to meet the highest safety standards and its unique features simplify its deployment and retrieval.

The SPSV is actuated by pressure differentials created by the ESP. This removes any reliance on the existing subsurface safety valve (SSSV) components and uses no pressurised chambers, hydraulic control lines or electrical power, improving reliability.

Greater use of cable-deployed ESPs using more efficient permanent magnetic motors (PMMs), benefits the industry by providing a more costeffective, retrofittable and rigless solution to maximise production, both on and offshore.

ABB

to lower delivery time and costs with the Adaptive Execution

As energy firms grapple with capital restrictions and project delays amid coronavirus, ABB says its virtual collaboration platform can help streamline delivery.

O

il producers have faced capital pressures during the pandemic; ABB has now introduced its Adaptive Execution platform, aimed at helping energy customers overcome the financial and logistical challenges presented by the coronavirus pandemic.

The digital virtualisation portal aims to

streamline the execution process of major capital-intensive projects, by integrating the planning, testing and development phases of a new venture into one system.

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When an existing ESP fails, operators can avoid the cost of a workover and lengthy downtime by retrofitting a slim-line cable-deployed ESP through the tubing, above the existing pump, stabbing into a seal bore packer set in the tubing. For depleted wells, or for reinstating shut-in wells that require artificial support to kick-start production, this through-tubing technology is fast and cost-efficient to install.

In many regions an API 14A qualified, subsurface safety valve (SSSV) is a legal requirement and most use a flapper style mechanism as part of the production tubing.

However, a slim-line retrofitted ESP is deployed through the production tubing on conductor cable to provide power. This means that the ESP cable renders a standard SSSV inoperable, whereas Pragma’s SPSV avoids this issue as it is located below the ESP. Other regions have also adopted regulations which require greater well control for mature producing wells, so the SPSV provides an ideal solution.

The Swiss-Swedish engineering giant says this can reduce automation-related capital expenditure (CapEx) by up to 40%, lower delivery schedules by up to 30% and start-up hours by up to 40%.

At a time when capital-spending budgets have been slashed industry wide, and projects have been delayed or put on hold due to lockdown restrictions, energy companies are increasingly seeking out ways to achieve cost-cutting and operational-efficiency gains.

Providing added flexibility for operators, the valve can be deployed in a variety of configurations, either run in with the production packer, or with the ESP and latch, allowing regular field maintenance. As part of the SP series the SP latch prevents the tubing and ESP from pumping itself out of the sump packer when production starts.

Created using advanced materials and with the option for additive manufactured components, the SPSV provides a compact and cost-effective solution. It is available in variants for both 3.5” or 4.5” tubing with a standard temperature rating of 150 deg. C. The unique bi-directional design permits a surface pressure test, to verify the integrity of the packer, valve and completion equipment. Emergency full bore pump-through is also available.

This versatile technology is multi-purpose and can be used as a safety valve for other artificial lift systems such as jet-pumps and velocity strings.

will fall by 20% this year – around $400bn – as firms confront the financial and operational implications of the health emergency.

Large capital projects across the sector frequently run over budget and beyond the expected timescale – a risk businesses are increasingly unwilling to take in this new environment.

Peter Terwiesch, president of ABB’s industrial automation division, said: “2020 has been a year of disruptions across the global energy industry.

The Adaptive Execution platform focuses on efficiency and adaptability during project delivery, by digitally centralising the various development stages for all key stakeholders, simulating operational processes using digital twins, and enabling a “remote” delivery of key milestones.

“With falling oil prices, challenges induced by the current lockdowns and the rising demand for sustainable-energy investments, companies are looking for new ways to reduce cost, schedule and risk for major projects in this low-CapEx environment.”

ABB says this will “remove the need for engineering on site and reduce the physical hardware required for a control and automation system”, with the number of engineering hours spent on project installation, commissioning and testing able to be lowered by up to 85%.

ABB Adaptive Execution platform reduces the time needed for on-site engineering.

It will “change the way customers, engineering procurement construction (EPC) contractors and vendors interact”, said Brandon Spencer, president of ABB Energy Industries.

The pandemic has forced energy companies to scrutinise their project-spending decisions this year like never before, while social restrictions have made in-person collaboration and on-site visits highly challenging.

The International Energy Agency (IEA) estimates capital investment across the energy industry

He added: “We can create better business value for our customers by creating an environment where everyone can do his or her own part with confidence, empowering delivery teams to achieve more, in less time. This is the key to overall project success.”

INNOVATION ZONE SPONSORED BY

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GREEN ENERGY

GREEN ENERGY ZONE SPONSORED BY

Concept image

Here at Xodus we have charged into 2020 with a true sense of determination and pride. I’m incredibly excited that most of our work utilises skills from across the business; from offshore wind supply chain experts to commercial analysists (and many more!). We know this works and that it adds value for clients. But we also know that this approach is fit for purpose in a world where the focus is on a broad energy mix and meets increasing demand. We are leading and guiding our Clients through the energy transition, and working together to deliver a responsible energy future.

Peter Tipler Renewables Director, Xodus Group

Spanish group to start building ‘disruptive’ floating demo Saitec's pivotable concrete design brings further innovations to the growing range of floating wind technologies that are attracting commercial interest.

Next month, Spain's Saitec Offshore Technologies will begin construction of DemoSATH, the first floating wind turbine to be connected to Spain's power grid.

Backed by German energy group RWE, the 2 MW project will be installed two miles off the Basque coast in northern Spain. The partners reached the final investment decision (FID) on the project earlier this year.

Floating wind groups are developing a wide range of technologies and using pilot projects to attract commercial partners. Designs which have been deployed early include Equinor's spar buoy concept and Principle Power's semi-submersible platform, but many other technologies are attracting interest.

Saitec believes its floating wind design could be "disruptive" for the floating wind market, David Carrascosa, Chief Technology Officer at Saitec

By Robin Sayles

Offshore Technologies, told the conference on October 2.

The floating structure is made entirely from concrete and features twin hulls and a single point of connection for the mooring system.

The use of concrete rather than steel reduces manufacturing costs and also promotes the use of domestic companies, key to meeting local content rules set in many offshore tenders, Carrascosa said.

Based on concepts used in the oil and gas industry, the single-point mooring system allows the platform to rotate like a weathervane facing into the wind.

This optimises wind resources and "dramatically" simplifies the connection process, reducing the amount of time required at sea, he said.

Data pooling In August, Saitec commissioned its BlueSATH pilot project in waters near Santander, northern Spain.

The project will operate for 12 months and learnings will be used to de-risk the DemoSATH project.

Built at 1/6 scale, BlueSATH features a 30kW turbine of rotor diameter 15 metres and hub height 17.5 m. The turbine is secured to the sea bed via three 150m steel catenary chain mooring lines and drag anchors.

The scaling down of design dimensions required certain changes to the relative dimensions and materials for testing purposes. Saitec selected a site near Santander as the local bay provides some protection from north-westerly storms, resulting in scaled down storm behaviour.

For DemoSATH, Saitec will move up in scale and install a 2 MW turbine in water depths of 85 MW. The turbine will have a rotor diameter of 80 m and hub height of 66 m. Six mooring lines made of catenary steel chain and polyester fibre will be anchored to the seabed and connected to the structure at a single point. Floating wind developers are shifting away from conventional steel catenary lines, favouring synthetic fibres that reduce costs and improve reliability.

Source: 'Offshore wind, ready to float?' report by University of Strathclyde, DNV GL (2019)

The construction and assembly of the DemoSATH project will take place in Spain and deployment is scheduled for late 2021 or early 2022, depending on the impact of COVID-19 in Spain, Carrascosa said.

Source: www.reutersevents.com www.ogvenergy.co.uk I November January-February 2020 2020

GREEN ENERGY Shared anchors slice cost of floating wind parts, vessels

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By Neil Ford

Shared anchor layouts allow smaller, lighter units and widen the choice of vessels, floating wind experts told Reuters Events.

As the floating wind sector advances towards larger commercial arrays, developers are deploying innovative anchor layouts and mooring lines to reduce costs. The deep water sites targeted by developers are located far from shore, increasing the importance of efficient mooring systems.

Equinor's 88 MW Hywind Tampen project in Norway, due online in 2022, will use only 19 anchors for 11 turbines in a "shared anchor" system. This is a sharp reduction from Equinor's Hywind Scotland project, online since late 2017, where 15 anchors are used to secure five turbines.

Symmetric layouts of mooring lines with common spacing are typically favoured as these provide sufficient anchoring for the full range of wind directions, Martin Nuernberg, Managing Director at Technology for Advanced Offshore Solutions, an engineering consultancy and vessel supplier, told Reuters Events.

chains in mooring systems with synthetic materials such as polyester and high modulus polyethylene fibre (HMPE).

Equinor's 88 MW Hywind Tampen project in Norway, due online in 2022, will use only 19 anchors for 11 turbines in a "shared anchor" system

A symmetric system where each anchor holds three lines reduces the number of anchors by two thirds. Through greater interconnection, a six line anchor system can reduce this number further.

Shared anchor systems must take into account specific load challenges for floating wind farms.

Sea and wind forces subject floating wind turbines to a range of high-frequency motions. “With the very dynamic response of the platforms, some problems have been identified with mooring line connection requiring earlier maintenance and replacement due to fatigue issues," Nuernberg said.

Appropriate design of the connection points will be key, he said.

To cut costs and improve reliability, floating wind developers are looking to replace conventional steel Source: www.reutersevents.com

By using new materials, Ideol aims to halve installation costs, which currently represent around a quarter of total capex.

Developers may also want to use a higher number of shorter, more lightweight mooring lines through shared anchor systems, to allow the use of smaller, lower cost vessels, Choisnet noted.

Line innovations Oil major Shell is investigating mooring line designs that reduce peak loads on the system, Pierre Liagre, a researcher on offshore wind floating systems at Shell, told Reuters Events.

This allows developers to deploy smaller anchors at lower cost, he said. The anchors at Equinor's Hywind Scotland project measure 16 meters tall, 5 m in diameter and weigh approximately 300 tons each.

Strong connections

French floating wind developer Ideol is looking to shift to wire rope or synthetic lines as they provide "better long-term performance," Thomas Choisnet, Chief Technology Officer at Ideol, said.

The use of reels of synthetic mooring lines rather than bundles of chains could also optimise vessel use and specialist vessels would further accelerate construction, he said.

Anchor sharing can also reduce the overall forces acting on the anchors, as the forces from different turbines are "counteracting in direction, therefore in effect can cancel each other," Nuernberg noted.

Mooring accounts for around 10 to 15% of total floating wind costs. On a wind farm of 100 turbines, shared anchor systems could reduce mooring costs by up to 20%, Nuernberg said.

The replacement of chains with fibre ropes can reduce mooring cost by a half, Tor Anders Nygaard, Principal Scientist at the Norwegian Department of Wind Energy, told Reuters Events.

Shell has invested in several floating wind technologies and is currently researching the use of in-line spring damper systems to reduce peak loads and minimum break loads for all the components, Liagre said.

Oil major Shell is investigating mooring line designs that reduce peak loads on the system

This would "significantly" reduce the cost for mooring systems in more shallow waters, he said.

Online tensioners could also be used to remove the need for deck machinery, while certain top connectors could enable faster mooring line hook up and disconnection, Liagre said.

GREEN ENERGY ZONE SPONSORED BY

Flexibility in mooring systems will be key if developers intend to tow large numbers of turbines back to shore for maintenance, Nuernbeg noted. “Plug and play is probably where everyone wants to be with these when distances reach several hundred kilometres offshore," he said.

www.xodusgroup.com

Sponsored by

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www.ducatuspartners.com companies such as EnQuest and Ithaca of their interest in bolt-on buying opportunities also suggest a targeted approach to consolidation.

ON THE MOVE The oil and gas acquisition landscape looks very different today than at the start of the decade; deal size and transaction numbers have decreased and the companies involved in these have changed; both in profile and perhaps more interestingly, in motive. For those who remain on the buying side, attention has turned away from transformational front page deals to a more modest approach which sees companies making selective acquisitions to complement core assets; advancing growth whilst controlling cost through the realisation of operational synergies.

As a timely testament this, the drivers between Chevron’s pursual of the acquisition of Anadarko versus Noble look very different just 18 months on, tempering what would have been a significant merger to a deal bearing more resemblance to a tuck-in. The North Sea has also seen transactions follow a similar narrative, illustrated by Chrysaor’s rapid rise to become the region’s top producer acquiring assets from Shell, Spirit, Conoco and of course, Premier. Several rumored sales simmering in the background and intentions voiced by

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Attention should also be given to underlying cultural factors, which despite holding the power to make or break key practical elements of the transition, are often underestimated on paper.

Moving the need on influencing behaviors to promote an enduring integration will critically require true executive sponsorship to build buy in across the organisation. Whether integrations

2

Stephen Guion

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Committing the time of executives and employees alike to such efforts may be seen as a luxury given retaining business momentum is now more crucial than ever, though cutting corners is a dangerous trade off, especially as the uncertainty the industry is facing has altered the backdrop to a merger. A more competitive supply chain and an imbalance between available talent and opportunities may provide a window of opportunity if examined more closely, whilst changes to everyday communication and a decrease in staff morale and trust following workforce cuts may pre-emptively heighten some of the challenges that a post deal environment only adds to.

Investing in integration, therefore, is very much validated to best position businesses to navigate both the expected and unexpected challenges of an acquisitions in order to capture value.

By Sean Buchan

Managing Partner - EMEA at Ducatus Partners

Catherine MacGregor

4

Bob Gillespie

Petrofac has announced the appointment of Sami Iskander as Deputy Chief Executive, a role he will hold for an interim period before moving into the position Group Chief Executive following the retirement of Ayman Asfari. Sami has over 30 years’ international experience in both oilfield services and exploration and production companies.

Sami Iskander

Petrofac Announces New Deputy Chief Executive

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Closing these deals, however, is just the beginning. Despite the prospective value identified during the due diligence process, the majority of companies fall short of synergy targets by an average of 20%. No matter how simple an integration may seem on paper, once all aspects of this are broken down they amount to a never-ending list of actions competing for priority status. Businesses must task a dedicated team to lead the effort to draw down on a realistic plan around tackling the transition and provide them with the space and support to act as architects of the integration; continually shaping, directing and reviewing strategy around evolving dynamics once this plan is set in motion and becomes a potentially different reality.

incur a complete re-organisation or require a seemingly painless change to back office functions, leaders must champion the involvement required from their team from day one to ensure this becomes instinctive to operations.

Stella Maris Announces New Vice President of Business Development

Stella Maris, the hydraulic power and control systems manufacturer, announced the appointment of Stephen Guion as Vice President of Business Development.

Stephen joins Stella Maris from Schlumberger, where he spent 19 years successively increasing responsibilities until serving as Vice President of Manufacturing for OneSubsea.

Before joining Schlumberger, Stephen spent five years with GE’s medical business.

www.ogvenergy.co.uk I November 2020

In his most recent role as Executive Vice President for Shell’s Upstream Joint Ventures business, he was accountable for business performance in Europe and the Middle East. He joined Shell through the merger with BG Group where he was Chief Operating Officer for the company’s global upstream operations. Prior to BG Group, Sami held key leadership roles with Schlumberger, undertaking assignments in the Middle East, Africa, Europe, Latin America and the United States.

3

Engie Appoints Chief Executive Officer

Engie has named Catherine MacGregor as Chief Executive Officer. She moves into this role as Isabelle Kocher departs the company after four years in this position.

Catherine began her career at Schlumberger where she spent 23 years, serving in senior leadership roles including as President Europe and Africa and President Drilling.

She joins Engie from Technip, where she led the company’s onshore and offshore engineering and construction activities as President of the Technip Energies business.

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Ocean Installer Appoints United Kingdom Managing Director

Ocean Installer has named Bob Gillespie as its new United Kingdom Managing Director. Bob has 27 years’ experience in the international offshore oil and gas and offshore wind industries. He joins from DOF Subsea where he was Managing Director for over four years.

Prior to this, he was a Commercial Director covering Europe and Africa with McDermott and also held senior leadership roles with Technip including Vice President Business Development and Commercial.

ON THE MOVE

Content provided by Ducatus Partners

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Pioneer Natural Resources Names New President and Chief Operating Officer

Pioneer Natural Resources has appointed current Chief Financial Officer Richard Dealy as President and Chief Operating Officer. Richard joined Pioneer’s predecessor Parker & Parsley over 25 years ago.

He has held various roles within Pioneer, including Vice President and Chief Accounting Officer and Vice President and Controller prior to his appointment as Chief Financial Officer.

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Robin Fielder

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Richard Dealy

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Andy Brooks

10

Pierre Girard

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James Brooks

Michael Kerr

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EOG Resources Names New Board Member

EOG Resources, the United States focused independent oil and gas company, announced the appointment of Michael Kerr to its Board of Directors. Michael has over 36 years of investment experience and has spent the majority of his career with Capital Group.

During his tenure, Michael has managed multiple funds as an Equity Portfolio Manager after covering global oil and gas companies and United States utilities as an analyst earlier in his career. Prior to joining Capital Group, Michael was an exploration geophysicist with Cities Service Company.

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9

Oil and Gas Authority Appoints Central North Sea Area Manager

The Oil and Gas Authority has announced the appointment of Andy Brooks as Central North Sea Area Manager. He replaces Scott Robertson, who was promoted to Director of Operations at the Oil and Gas Authority earlier this year. Andy spent five years with BP supporting various assets such as ETAP, Wytch Farm, and Southern North Sea Gas before moving to CNR International as a Production Engineer to support their holdings in the Ivory Coast. Andy brings 18 years of experience working in various roles for several companies from majors to independents.

10

TC Energy Names New Chief Executive Officer

Neptune Energy Appoints Director of New Energy Business

TC Energy, the energy infrastructure Neptune Energy has announced the François Poirier business, has appointed François appointment of Pierre Girard as Director Poirier as Chief Executive Officer. François’ of New Energy. Pierre is currently Director of joined the company six years ago as President Commercial and Joint Ventures United Kingdom and Energy East Pipeline. His previous roles include previously held the role of Interim Managing Director leading the company’s Mexico business unit and of Neptune’s United Kingdom business. leading the company’s risk management, strategy and corporate development efforts. Before joining He has more than 30 years’ experience in the oil TC Energy, François spent 25 years in investment and gas industry, having held senior positions at Elf, banking, consulting and as a Corporate Director.

Chevron, and Engie in France, Angola, Egypt and the He was President and Head of Investment United Kingdom.

Banking and Capital Markets for Wells Fargo Securities Canada.

7

Noble Midstream Announces

Leadership Transition

Noble Midstream has announced that current Chief Operating Officer Robin Fielder has been named Chief Executive Officer. She succeeds Brent Smolik, who served two years in the role.

Robin previously served as Chief Executive Officer and Director of Western Midstream. Prior to these roles, she served in positions of increasing responsibility at Anadarko, including as Senior Vice President Midstream, Vice President Investor Relations and General Manager of East Texas.

11

Shell Names New Global Vice President of Strategy and Portfolio for Power and New Energies Business

Shell has appointed James Brooks as Global Vice President of Strategy and Portfolio for the Power and New Energies business. He replaces Elisabeth Brinton, who served two years in the role. James joins Shell after nearly three years as Chief Strategy Officer of Lightsource BP. James brings 20 years’ experience in board leadership and investment management for Goldman Sachs, First Reserve, Advent International and UBS.

44

OPINION

By Moray Melhuish Digital Twin by GDI

Offshore Energy: The dawn of digitalisation The Challenge COVID-19 has been a significant catalyst for change, both on and offshore. The collapse in the price of oil hit an industry already dealing with the multiple challenges of declining production, ageing infrastructure, and decommissioning.

The supply chain was hit particularly badly – expected to contend with the triple challenges of lower levels of business, at lower margins, while maintaining safety and service levels.

Just as things were looking really tricky, along came the pandemic to pile multiple challenges and costs onto an already struggling industry.

The full impact will only be known once the furlough scheme ends, but it is clear that thousands of personnel have been lost to the industry, through redundancy and early retirement. Many of those who have lost their jobs will find new careers – perhaps not paying quite so well, but in stable growth industries such as offshore wind. Experience and expertise gained over a generation of offshore production is being lost – and the next challenge as the industry recovers will be how to get it back, and how to do without it if it can’t.

Under these conditions, the industry has no choice but to explore new ways of working.

One way to preserve knowledge, achieve safe and low-cost production with fewer personnel is through digitalisation.

Digitalisation The concept of digitalisation has been getting a lot of attention around the industry over the last few years - but what is it? The answer is not as obvious as it may seem.

We have all seen them, marketing posts and promotional materials championing digitalisation as being anything from the simple transcription of analogue data into a cloud-hosted database for digital and trend analysis, to the digital automation of business processes, the remote monitoring of offshore operations or even full automation.

In truth, digitalisation can be all these things.

The essence though is on providing data to drive effective decision making and this is an area in which companies both small and large are contributing to dramatic change and improvement.

www.ogvenergy.co.uk I November 2020

Moray Melhuish

Internal Business Digitalisation A great starting place for many businesses looking to improve their effectiveness and competitiveness in the market is with the digitalisation and integration of internal management systems. After all, decision making is easy once the team responsible for making them has access to the right information.

I have experienced and evaluated several such systems, from providers as diverse as multi-billion-dollar software houses looking to charge eye-watering amounts for their service packages down to small innovative specialists looking to make a difference.

The best I have seen and used is undoubtedly Caiman IQ by Aberdeenheadquartered SME Caiman Software.

Caiman IQ is a simple, integrated software tool used by offshore and technology businesses to digitally capture integrate, automate and report information, decision making and workflow seamlessly from throughout the organisation.

During challenging business conditions, its ability to efficiently and quickly enable decision making based on real time information from across the HSEQ, HR, Supply Chain, Commercial, Engineering and Operations functions is unparalleled and of huge value to any technology manufacturer or offshore service business.

Once a company’s internal processes are aligned, it’s important to look at how it provides its service to customers, and whether quality or cost improvements can be made there.

Digital Twins A ‘Digital Twin’ is a virtual replica of a physical installation, process, product or system. It can include an intuitive, visual model of an asset which enables integrated, multi-layered contextualised data to be accessed securely by users from anywhere in the world.

Typically, these tools integrate 3D scanning or photography of an asset to generate a digital walkthrough of an asset, which is overlayed with visual engineering, process and integrity data.

There are many providers in this area, not least Wood, Askelos, Eserv and GDI. More than a training and orientation or dashboard tool, an effective twin can be accessed from onshore or offshore, enabling interrogation of maintenance and production data to be stored and accessed to enable collaborative working with deep and broad information shared across an organisation.

One challenge with populating digital twins – particularly in the oil & gas industry – is that instrumentation levels tend to be low. Either instrumentation was never specified and fitted, or in some cases it was too expensive to replace when it failed.

This aspect is one in which retrofit Internet of Things (IoT) devices have a role to play in improving knowledge (and therefore decision making) in our offshore assets.

OPINION

Potential The promise of digitalisation goes further than improving knowledge of asset and process conditions, as it could potentially reduce the size of teams offshore.

If we further develop the concepts of a digital twin populated with retrofit devices to monitor, condition and process in real time, combined with remote monitoring of the site from onshore, it is not a huge stretch to see that many assets could ultimately be automated.

Retrofit Monitoring Designed to monitor parameters as diverse as flow, vibration / fatigue, pressure, temperature, and metal thickness, retrofit devices can be installed either topsides or subsea. Wireless installation is preferred due to the elimination of leak paths within the device, coupled with reduced cost and complexity. A wireless Internet of Things (IoT) device is simply one which connects to a network and can take measurements and transmit data. Each device is considered a ‘node’ on the network.

There has been considerable investment in retrofit IoT monitoring in the industry, spearheaded by operators such as BP, Shell and CNR, and organisations such as the OGTC. In areas where real-time communication is not possible, the retrofit of monitoring devices still makes sense. Business transformation through digitalisation does not have to be a grand, binary project or a huge investment. Simple, well proven devices from manufacturers such as Aquatec are being used to monitor wave-induced pressure variations in the monitoring of subsea platform integrity.

While not necessarily networked for real time information on asset condition, they do provide the essential first starting point – long-term datasets, which can be modelled and extrapolated for the making of asset and production critical decisions.

Once installed, monitoring devices enable the harnessing and analysis of big data sets, enabling precious maintenance and intervention budgets to be targeted on the most deserving areas.

As with all new technologies, there are challenges, not least the potential presence of lithium-containing batteries, and the fact that many North Sea platforms don’t even have Wi-Fi coverage with which to facilitate connections between nodes.

Communications and Machine Learning If we overcome topside restrictions and network the devices, we not only improve real time information, but we open up the potential of machine learning. This is increasingly being used in industry to create ‘Intelligent infrastructure’ which can take over routine operations and predict the requirement for intervention in real time and providing better data for the design of future installations.

So wireless communication between nodes on the surface is a challenge due to limitations of existing infrastructure – but it is even more complex subsea due to the complexities of intellectual property.

Certainly, the claims are impressive. Among the champions of upstream digital transformation are Siemens, whose offering promises not only to significantly lower operating cost through reducing manpower by 80% but also increasing production by 15% and extending asset life – all with a claimed payback on investment of 5 years.

Are we seeing the inevitable dawn of digitalisation?

Change is inevitable, and COVID-19 has accelerated the necessity for change.

Digitalisation promises much for our industry and the effect it has can be revolutionary – but the process of getting there is not a revolution. Digital change does not have to be all-encompassing. It can be achieved in discreet, iterative steps and we can begin with looking at our own businesses and facilities for improvement.

To make real progress in the subsea arena, there needs Whether or not the real-life benefits to be standardisation of match the claims made by its communication protocols promoters - the benefits to health, between all devices above safety and the environment, Business efficiency, or below water. This is an cannot be overlooked, nor can risk reduction and costarea where the Subsea the essential cost and carbon base differentiation are Wireless Group (SWiG) footprint reductions or the should be encouraged potential to extend asset more important than as they promote life, achieved through better ever – and digitalisation interoperability for subsea decision making. has a central role to play wireless communications (Radio frequency, acoustic, Today the oil & gas industry in a struggling oil & free-space optic, inductive is struggling with the gas industry. power, hybrid). While SWiG complex challenges of latehas made great strides in some life assets, depressed demand areas of the oil & gas industry, it will for hydrocarbons, a higher cost only succeed in its mission once it has of production due to COVID-19 and all the participation of all the holders of relevant combined with the shareholder pressure to intellectual property – and their involvement will refocus capex on the emerging energy transition. only come about when stimulated by Business efficiency, risk reduction and cost base the operators. differentiation are more important than ever – and digitalisation has a central role to play in each.

With the increasing importance of offshore wind developers to the development of subsea Whatever their perceived role in the supply technologies, the remit of SWiG also needs to chain, modernisation and the adoption of digital be broadened to embrace and include offshore technology is essential and inevitable - not just for energy producers of all types, including offshore the survival of our businesses, but for the future of wind and tidal generation. our industry.

The author is an independent consultant. He is not a shareholder, employee or consultant of or for any of the businesses mentioned in this article. Opinions are his own and can be challenged at www.linkedin.com/in/moray-melhuish-aa883614

45

COMPANY NEWS

46

Namaka Compliance announce the formation of a partnership with Sonic Offshore (a Norwegian based company)

B

oth companies have created electronic systems that together allow for an online resourcing portal which also has a competence management system that underpins this unique selling point. The partnership predicts this USP will revolutionise the way in which Energy companies resource individuals. This will allow companies to have the ability to view assessments and training requirements in realtime as well as giving them the ability to track personnel’s work history.

This end to end technology solution is seamless and as the industry is embracing digitalisation, Namaka Compliance and Sonic Offshore look to be at the forefront of this.

The Sonic Offshore Business Development team will be working with Namaka Compliance, to see how this product can assist International Energy Companies (IEC)s, Engineering, Procurement, Construction (EPC)s, Drilling Contractors, Vessel

operators and SME’s with their resourcing of a compliant and competent workforce.

Jamie Murphy, Managing Director of Namaka Compliance said “After a presentation by Sonic Offshore of their online resourcing solution ‘Cloud Sonic’, I could see that their software was a natural fit with our online Competence Management System ‘Athena’ and I very much look forward to a very successful partnership”.

Additionally, this partnership will utilise industry knowledge to develop the service across multiple sectors and geographical locations.

Sonic Offshore MD Jens-Petter Fiksdal commented “The beauty of this partnership is that it can be utilised by any company, in any industry and location that wishes to undertake resourcing in real time and via the most efficient possible method, whilst ensuring that any individual they engage is competent and trained to the required level.”

QHSE Aberdeen Ltd announce contract win for new service area

Q

HSE ABERDEEN have are delighted to have been awarded a new contract to assist Rosetti Marino on The Premier Oil operated Tolmount Field project. The platform, designed and developed entirely in Italy, Sailed from Rosetti Piomboni Yard in Marina di Ravenna, it reached its final destination, the Tolmount Main Field located in the North Sea last week.

Director Angela Scott said “We are delighted to assist Rosetti Marino with this project. We have been picking up extra project work since the start of the Covid pandemic and this new contract win demonstrates our diversified service offering and capability to provide QHSE support to our customers in offshore as well as onshore environments. Our recent recruitment drive has helped us to build on our in-house expertise and develop new areas of competency ”.

www.ogvenergy.co.uk I November 2020

QHSE ABERDEEN’s specialist consultants will assist Rosetti Marino with UK Compliance and HSE Consultancy, advising on all aspects of Health & Safety and Environmental issues from Permit to work to Auditing.

Dave Rusling, Managing Director said “At QHSE Aberdeen Ltd, we pride ourselves on our Customer Service, we deliver over and above what the Client expects and this has given us our hardearned reputation. Our knowledge of UK HSE compliance and International law attracted this particular Project and we look forward to offering this expertise to the wider market”.

QHSE Aberdeen Ltd are a team of specialist consultants with expertise in various ISO Standards including 9001, 14001, 45001, 27001, GDPR Compliance, Data Protection and Training.

The benefits of this system are: •

Cloud based recruitment service available any hour of the day.

•

One source of funding for all personnel.

•

Leadership Development.

•

Online Competence Assessment/Verifications.

•

Tracking of individuals.

•

Automatic updating of CV’s payments etc.

TRAVEL PARTNER Going above and beyond to support a vital service At Traveleads, we pride ourselves on building partnerships with our clients. We work tirelessly to look after your best interests in a number of ways – all with the aim of saving you time, money and adding value through expert consultancy. Ultimately, we want to make life easier for our clients, with a huge focus on the welfare of their most valuable asset - their people.

Never more so than at a time like this.

Supporting essential workers Our customers span a variety of sectors – from energy to medical services, manufacturing to sports teams. And whilst there is currently a global ban on the movement of people, the government has recognised the need to keep certain industries operating, meaning many still need to travel domestically and internationally. Whilst this may sound simple, it’s been a real complex challenge that our team has risen to.

Let’s look at the energy sector in particular, which like others is working from home where possible.

But with critical operations taking place up and down the country, on and offshore, there is no getting away from the fact that these essential workers need to travel; more than 12,000 UK staff are still working offshore, amounting to 40% of the total workforce across 147 offshore platforms.

With closed borders, reduced services and a myriad of other complications, our expert advice and continued support to keep them moving safely continues to be pivotal.

Traveleads Sales Director Sally Cassidy explains: “Arranging domestic travel to and from Aberdeen, as well as international travel to key energy hubs around the globe, has certainly been interesting at times. With border and quarantine restrictions, as well as complex visa requirements, our team’s skills are being put to the test but despite the odds, they always go above and beyond. Making it work for the client is non-negotiable.”

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Communication and forward-thinking The Traveleads partnership ethos is stronger than ever. Our team of experts are fully conversant with all the latest travel updates, guiding our clients on the best options available and alternative solutions in response to rapidly changing flight schedules and wider travel restrictions. Regular communication and proactive support for all our clients has been vital. Firstly, to provide reassurance that measures are in place for safe travelling. Secondly, as their travel partner, we are working closely with them to fully understand re-entry and return to work plans, offering assistance to update travel policies and procedures with passenger safety at the forefront, whilst continuing to deliver the efficiencies our clients depend on.

What the future looks like We know many of our energy clients are looking to resume travel as soon as is safe to do so and we stand ready to support them with this and the increasingly complex requirements that will no doubt continue. We continue to consult heavily, offering advice and knowledge even on speculative plans to support decision-making in a very challenging landscape.

As we look to the future, we recognise that welfare of travellers will be more important than ever and we’re already liaising with suppliers to ensure they’re putting in robust measures to uphold the highest possible standards as travel increases.

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We believe in delivering more than just travel management. We make our customers lives easier and this is proving to be invaluable at a time like this. So, whether our clients are travelling or not right now, we’re here.

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47

48

PEOPLE IN ENERGY ITHACA ENERGY demonstrates best practice in preparing for IR35 reform

With just months to go until IR35 reform is extended to the private sector on 6th April 2021, many oil and gas companies are busy readying themselves for the introduction of the off-payroll changes.

This controversial reform will see oil and gas firms, like all medium and large businesses, become responsible for determining the IR35 status - also referred to as employment status for tax - of the contract workers they engage.

As part of these well publicised changes, whichever party in the supply chain is tasked with paying the worker - whether the hiring organisation or the recruitment agency - will shoulder the IR35 risk.

The changes, as you may well know, pose challenges for contractors, fee-paying recruiters and oil and gas companies themselves. But that’s not to say they aren’t manageable and spell the end for contract working - far from it, in fact.

Some businesses are ahead of the curve, fully prepared and ready for the arrival of IR35 reform - the North Sea independent oil and gas company, Ithaca Energy, being one. This industry leader had the processes in place to successfully manage IR35 reform nearly 12 months ago.

This was after the oil and gas operator prioritised its IR35 preparations in advance of the original date for the rollout of IR35 changes in April 2020 - an event that was delayed due to the ongoing pandemic.

Through Ithaca Energy’s approach, the organisation - who say its strength lies in its talented team of approximately 400 workers - is set to be in a position where it can continue engaging contract workers beyond April 2021, while also managing the risks that the IR35 legislation poses.

www.ogvenergy.co.uk I November 2020

But how did one of the UK’s most respected oil and gas companies make sure of this? And what were the specific steps taken that will allow for the continued use of contractors?

Carol Norrie, Ithaca Energy’s SCM Category Manager, explained that, following a thorough examination of the impact IR35 reform will have on their organisation, they formed an ‘IR35 Working Group’ before devising a transparent and measured strategy with the support of leading IR35 specialist, Qdos.

“IR35 reform was highlighted as an important legislative change with which we needed to ensure compliance. As a result, we worked hard to get a firm understanding of the legislation, before developing a plan to ensure we were in a position to compliantly engage genuine contractors outside IR35 in advance of the changes being rolled out.”

Because the business benefits from engaging skilled contractors on a flexible basis, Ithaca Energy had no intention of approaching the IR35 legislation in a blanket fashion or in a non-compliant manner.

Instead, the company committed to learning more about this legislation, with knowledge and education forming a core component of Ithaca Energy’s IR35 strategy. To help with this, the business sought the assistance of a range of industry experts including IR35 specialists, Qdos, who ensured they were informed from the start.

In addition to an initial IR35 audit, regular workshops and advice to bring all stakeholders in the business up to speed, Qdos was tasked with assessing the contractors Ithaca Energy engages.

Conducting case-by-case and expert reviews of each contractor’s IR35 status was key in helping ensure IR35 compliance. Qdos’ team of IR35 experts, who carry out over 2,000 independent IR35 status reviews every month, ensured existing and newly engaged contractors had their engagement rigorously assessed in the lead up to the anticipated arrival of reform last April.

Alongside this, Ithaca Energy then chose to protect themselves with a Qdos IR35 insurance policy supporting outside determinations. The insurance covers the cost of potential HMRC investigations, including IR35 defence in court and resulting tax liabilities.

Key takeaways for businesses • • • • • • •

Prepare well ahead of the changes Develop a clear and timelined strategy Ensure transparency by regularly communicating with all stakeholders Prioritise IR35 compliance, with independent IR35 status reviews Engage subject experts early on Avoid risk-averse decisions and do not rely on HMRC’s IR35 tool, CEST Mitigate risk through IR35 insurance

As a result, this North Sea oil and gas operator is confident of its compliance and is ready for the eventual roll out of IR35 reform this coming April.

Thanks to a measured, pragmatic approach and the ongoing assistance of Qdos, who is supporting over 2,200 businesses with their IR35 processes, Ithaca Energy has no doubt that it can successfully manage the changes.

This is something that Carol Norrie said will help the business achieve its goal of becoming the highest performing UK North Sea independent oil and gas company: “We are confident in our approach to IR35 both pre and post reform. We believe that our processes are robust, fair and transparent. We are clear on key milestones, such as re-engagement of our contractor workforce and with suppliers and do not envisage any issues when the legislative reforms come into force.”

In the coming months, Qdos Operations Director, Nicole Slowey, expects to see many more oil and gas businesses ramp up their activity as they prepare for the rollout of reform: “With IR35 reform rapidly approaching, more companies are turning their attention to the changes. By taking the right steps, businesses will be in a position to navigate the reform, allowing them to continue engaging true contractors outside the scope of IR35 and manage the risks that this reform presents.”

For more information abut QDOS visit: www.qdoscommercialservices.com

LEGAL & FINANCE

49

By Laura Petrie, Partner at Brodies LLP

Hindsight is 20/20.

Never has a proverb been more appropriate than when considering an article that tries to look ahead to what might happen in 2021.

Diversifying out of the Dip At the end of 2019 there were very few people, if anyone, who could have accurately foreseen how 2020 would play out. And as the end of the year approaches, how can oil and gas businesses use that hindsight to plan for the future?

Since the commencement of large-scale oil and gas production in the UKCS in the 1970s, the industry has faced various challenges, hardships, peaks, and troughs. The implications of harsh working environments, reliance on a finite resource and both national and international external market forces mean that those working in the industry are aware that downturns can occur all too rapidly. The last fifteen years have seen the industry move through various downturns with increasingly shorter periods between those dips, and yet, it is an industry that remains resilient, has adapted and in some cases, reinvented itself in response.

With that in mind, and while COVID-19 continues to dominate the headlines, it is perhaps time to focus on some of the positive developments the industry has seen throughout 2020, and how these might play out in 2021 and beyond.

People are Power

Transformative Technology

The energy industry relies on its skilled workforce, not just in terms of practical capability but in the asset knowledge that has built up over the years. During downturns the risk remains that skills and knowledge can be lost due to required downsising. Management of staff during a downturn provides a good opportunity for review of HR policies, employment processes and contracts, and also assessment of training and upskilling that may be required to ensure staff are best placed to support the business through harder times. Coordinating any such review comes with legal challenges to ensure that compliance with law and regulation is assured at every stage.

Historically, technology booms have followed periods of downturn and the expectation is that the years following 2020 will be no different.

Employees and organisations have had more time to investigate new technology and develop existing ideas. The Oil and Gas Technology Centre has highlighted a rise in new concepts and ideas relating to digitalisation and low carbon technology aligning with a growing focus in the industry to be more energy efficient. Protection and commercialisation of new ideas requires significant legal input from an early stage to ensure that all rights are suitably preserved and any financial or technical support from third parties is suitably documented.

WTI vs BRENT 1 YEAR

WTI 1 MONTH

This year has shown that businesses can adapt and move quickly to address changing circumstances. In preparing for 2021, the industry has an opportunity to assess assets and business offerings and take the time to plan for adapting, diversifying or changing their approach.

Having demonstrated that rapid change is possible, the hindsight gained from making those changes together with more time and opportunity to plan gives better scope to assess issues that may arise as a result of such changes. From a legal perspective this can include obtaining international legal advice, re-structuring or simply undertaking reviews and due diligence of existing contract terms.

With the skills and knowledge built during 2020 and previous years, and the benefit of hindsight, the industry can prepare for a new chapter where it's people, technology and resilience will be central to the story.

BRENT 1 MONTH

50

COMMUNITY PARTNER

up about this serious issue. AFC, along with Health Shield, are committed to tackling this issue head on and playing a role in supporting our fans.”

ACTIVE USERS OF FREE APP FOR DONS FANS INCREASES AS COVID-RELATED MENTAL HEALTH ISSUES EMERGE Aberdeen FC and its health and wellbeing partner, Health Shield, have seen an increase in the number of fans actively using its free mental health app since it was rolled out in June this year.

Almost 33% of active users are suffering from depression with 30% of those classed as moderately to severely depressed. Anxiety has also increased with 38% suffering from moderate to severe anxiety.

The causes of their depression and anxiety stem from work, fear of going outside and relationships. On the flip side, their work, health, being able to get out and about, family and relationships have been identified as positives in helping them cope.

www.ogvenergy.co.uk I November 2020

Around 8% of users have sought further help in dealing with mental health challenges and 6% of those suffering from anxiety report they have recovered, while 5% of those feeling depressed have also now recovered.

Rob Wicks, AFC’s Commercial Director, said: “It’s really concerning that an increasing number of people are suffering from mental health issues. We’re therefore pleased to be able to offer support to our fans through this app, which is proving to be a valuable tool to those who need it or to those who want to support family, friends or colleagues.

“With reports suggesting that one in four people will suffer mental health problems as a direct result of COVID-19, the Club has been speaking

AFC was the first professional football club in Scotland to offer fans access to the innovative health app which provides support and guidance on mental health. Users can assess, manage and improve their mental wellbeing with a range of mindfulness tips, tools and techniques. The NHSapproved app, Thrive, is available to all Dons’ fans and usage has increased as people seek proactive help and preventative advice in relation to their mental health.

Health Shield, which is committed to helping people lead healthier, happier and more productive lives, has seen a number of organisations access the app, including a men’s mental health support group and workers on the NHS frontline.

Courtney Marsh, CEO at Health Shield, said: “The pandemic is taking its toll on body and mind and, unfortunately, worse is probably yet to come as furloughing ends and redundancies increase. Not only that, but mass working from home is creating its own issues for many - especially for women and the younger generation - in terms of loneliness and the negative impacts of that on wellbeing and productivity.

“At Health Shield, we’re all about helping keep our customers in the best of health, so it seemed only fitting to offer free access to our NHS-approved mental health app Thrive to all Dons fans. We’ve also seen great take-up of this offer elsewhere amongst key workers, charities and students.

While it’s sad to see that depression and anxiety is on the increase, it’s good to know that help is at hand, especially for those less likely to talk about their problems.”

AFC supporters can find out more about Thrive visiting info.healthshield.co.uk/free-accessto-thrive-afc and following the simple steps to download the free app.

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