Davis Larssen, Chief Executive Officer for Proserv

Interview by Moray Melhuish – Founder of Annet Consulting, an Offshore Wind and Subsea Specialist

Hi Davis, can you introduce yourself and Proserv, please?

I’m Davis Larssen, Chief Executive Officer (CEO) of Proserv. We are Aberdeen and UK headquartered, traditionally within oilfield services, and a global controls technology company that has spent the last three or four years making a pivot into renewables. I have been in the business myself for 13 years across various roles and I enjoy playing a central part as CEO, driving Proserv into a new direction.

We've got 13 sites around the world, including several in the UK and a sizeable presence in Houston, Texas, two big facilities in Norway, and then four locations across the Middle East and India.

How did you find the pivot into renewables? How was the reception?

The first year or two, I would say there was a lot of 'Why are Proserv here? What do you think you can do for us?' because we were seen as an oilfield services company or a controls technology company. But I would say over the last 12 to 18 months, that view has very much changed to 'We now recognise and understand what you can do. How can you better help us to make those forward steps?' So I have personally seen a big change with that.

That's good to hear. At the end of the day, it is an energy transition. There's no point in getting rid of all the expertise from before and reinventing the wheel. Do you think the amount of capital coming in from oil and gas has helped that perception?

I think it's helped in some ways. We've seen some of the major oil and gas players over the last few years take a more visible part in renewables. So, a lot of the bigger customers from oil and gas are also pivoting into that space, doing a similar thing to what we've done. At the risk of getting into a contentious area, we have the whole political landscape that's behind it all. But certainly, as somebody who's been in the north-east of Scotland for

30 years of my life, I see a huge wealth of skill sets and expertise in this area that, if we are not careful, we could lose substantially and so not embrace the ability to transform Scotland and the UK's wider fortunes in offshore wind, and floating offshore wind specifically.

Did I read that your ECG™ holistic cable monitoring system for offshore wind had been installed at Dogger Bank?

Yes, you did. So, it's being installed on Dogger Bank A and B, hopefully it will be getting installed on Dogger Bank C and subsequent developments. It is the first of its kind and it's in the process of being installed on Equinor’s Hywind Scotland as well, which will give it another full live demonstration of its real-time monitoring capabilities on a floating asset.

How do you find the actual contracts used in offshore wind?

Right now, because they very much follow the EPC ‘lowest up-front cost wins’ model, there's very little focus on the total cost of ownership, reliability and uptime. We think that's where the significant improvements are going to come. We know, for example, through our ECG™ solution and what we're projecting through our cable monitoring and our developing wider holistic wind farm monitoring, you can effectively increase the capacity of a typical offshore wind farm by 15 to 18% - that's like the equivalent of an extra free wind turbine, essentially, if you can manage the balance between efficiency, reliability and uptime in the right way. But if operators and developers don’t think about that at the outset and new assets are approached solely from an EPC perspective, then it isn’t built into the whole design functionality. This is one of the major parameters that we feel needs to change in the industry.

Thinking about your entry into the offshore wind market and the potential for your technology, it sounds like the opportunity for that capability is massive. I would imagine that there are also considerable opportunities for potential employees too?

Any given month, we've got roughly 40 to 45 open vacancies globally across the 13 sites I referred to. Our success rate at the moment is we're probably hiring about 25 to 30 of those vacancies every month. We're hiring right across the scope, in terms of functions, so predominately engineering based and we've got everything from wind turbine controls engineers to software developers, to mechanical and hydraulic engineers, project managers - everything across that whole spectrum because obviously, we're trying to push into a new area here. So, we are looking to hire people who've got specific domain knowledge in those areas to marry them up with the existing know-how that we have internally, and those 40 to 45 jobs are effectively across the industry as well.

Given that you are headquartered in Aberdeen, Scotland, are you seeing big demand for local content?

We are seeing a lot of people ‘talk’ about local content. It's an interesting conundrum right now because if you look at a lot of the big hardware and infrastructure, you know, the turbines, the blades, the foundation systems - we're struggling from an infrastructure perspective to build that kind of stuff in Scotland and the UK in general. And typically, where we've got the capacity, we struggle to compete with other parts of the world where they have lower costs of labour.

So, I think there's a geopolitical question, or problem, that's going to come to the fore in the next few years around that. I can certainly see us being prepared to pay a premium to build that equipment in Scotland to create jobs. But I think the limitation is going to be that we'll never be in a position to export this capability to other parts of the world. With what I've been talking about and what Proserv is focused on from a software engineering and controls domain knowledge perspective, the cable monitoring perspective, we've got the ability, we think, to create a number of highly paid, highly skilled jobs and use them as an exportable trend like we did in oil and gas 50 years ago from the north-east – but not on the infrastructure side. And that's a big change that the industry will have to go through over the coming years.

Proserv is involved in both oil and gas and offshore wind, which is great. As I say, it's an energy transition, so what is a fair transition to you?

It's a very good question. Four or five years ago when we started our pivot, we recognised the transition was underway and we didn't quite know at that point where we should play in it, but it's obviously gathered pace since then. So, the transition is important. I think it's difficult for anybody to argue that we don’t need, as a society, to move to more renewable sources of energy globally, but it can't happen overnight.

We have been reliant on oil and gas for a long, long time. So, from an energy security perspective, as has been highlighted by the conflict in the last 18 months in Ukraine, that's brought added pressure to a lot of markets, including the UK, and we need to make this transition in a just and viable manner to protect the expertise and the livelihoods of people who are employed in that sector today, and to make sure that some of those people are capable of making the pivot across into the renewables sector as well.

So, I think it's a struggle to put an exact timeline on it but if you look today at the percentage of energy in the UK generated by renewables versus oil and gas – if we simply turn off oil and gas, we’d have big problems. We would struggle to function as a society, and I realise that is not necessarily a popular view with everybody, but for me it's the reality of where we are, probably for the next five to ten years.

We need to make the transition in a just manner, to protect and retain the skills sets and the knowledge base to benefit renewables, at the same time as not having to import our energy from somewhere else, potentially at much greater cost and with a bigger carbon footprint.

That's right. So, how do we accelerate that transition from your perspective and particularly, of course, the offshore wind elements which you're involved with?

I think there are a few elements to this. Part of it is adopting technology, and part of it is involving the supply chain in creating solutions. So, how do we help some of the bigger operators and developers to have an incentive to test new technologies, to accelerate that process, to try something different? So, I think there needs to be some discussion around that.

Ideally for me, I would like to see a multiyear energy policy covering the whole of the UK. So, something like a 20-year strategy that sits above the political dynamic that happens from election to election. I realise I am not in control of that, but I think that is the main element, if you could wave a wand and change one thing. To give the UK a chance to stand head and shoulders above any other country in the world.

For those who are students, and perhaps early on in their careers, would you have any advice to people considering a career in the industry.

There are probably a few aspects to this that I would reflect on. One is don't get hung up on renewables versus oil and gas. In the last few years we’ve seen some graduates and apprentices saying they don't want to come into oil and gas because it's a dead industry. The skill sets are transferable between the two. A lot of the bigger oil and gas operators are all making pivots towards renewables. If you join a company in oil and gas today, the chances are you'll be involved in renewable energy, if not tomorrow, at some point in the future.

I would say, don't be hesitant or afraid to step into roles where you don't know how you're going to be successful, or situations where you don't know what the solution is, because developing the ability to be part of a team that solves complex problems in harsh environments stands you in huge stead. If you are starting out as a graduate or an engineer, don’t always take the easy option. Sometimes, the harder option is the better long-term gain to develop you as a person.

How do you define success for Proserv?

We're very well known today in the oil and gas space, I would like to think, as the controls technology provider of choice. I would also like to think in five to ten years we are recognised as that across the broader energy space. Totally OEM agnostic, and the partner that operators come to for ‘the position of truth’, and to understand how they improve the performance, the reliability and uptime of their offshore wind or oil and gas infrastructure. That’s where we want to get to.