A giant catamaran strong enough to lift
four Eiffel Towers will set off from a South Korean shipyard next year
with the task of decommissioning North Sea oil rigs - a $3 billion bet
that bringing derelict platforms ashore can be a profitable business.
Since the 1970s, 500 oil rigs and 45,000 km
of pipelines have been installed in the North Sea to tap reserves that
have fed Britain and Norway. But ageing infrastructure and dwindling
productivity mean some of the fields are no longer profitable.
Oil companies have considered turning
redundant rigs into casinos or hotels but most are destined for
dismantling to prevent environmental damage from rust or leaks. Oil
services companies are developing equipment for a decommissioning market
that Deloitte estimates could be worth $50 billion over the next 30
years. The question nagging the firms is one of timing.
New technology is enabling oil companies to
squeeze more out of ageing fields, continually pushing back the date of
decommissioning. Contractors do not want to miss out on the work when
it comes, but many are also struggling to pull together skills and
equipment that require serious investment. Getting the timing wrong
could be costly.
Edward Heerema, chief executive of
engineering group Allseas, is hoping the Pieter Schelte, the
382-metre-long, 124-metre-wide catamaran he commissioned and named after
his father, will capture a large part of the business.
"This is the biggest bet of my career," said Heerema.
"It's very difficult to show that it's really going to be extremely profitable," he added.
The concept of the boat is 25 years old,
according to Heerema. But only now has a pipeline of work coincided with
his company having the financial muscle to build the ship.
A video on the company's website shows a digital mock-up of the boat, resembling two oil tankers joined together, in action.
The ship sails up to the oil rig guiding
the steel platform above the water between its two hulls. Hydraulic
clamps stick to the under part of the platform which is then lifted with
seeming effortlessness in one quick movement and carried to shore.
Named after Pieter Schelte Heerema, an oil
engineer whose vessel designs have been installing offshore rigs for
decades and whose sons still dominate North Sea muscle-ships, the ship
can lift up to 48,000 tonnes, more than quadrupling the current top
capacity.
The vessel caused controversy in 2008.
Heerema was a member of the Nazi Waffen SS during the Second World War
and was jailed briefly as a collaborator by a Dutch court. Jewish groups
complained when they learnt the name.
A BIG BET
The Pieter Schelte has already been signed
up to remove platforms from Shell's Brent North Sea field, beginning
with Brent Delta in 2015 or 2016.
The ship's size and stability give it an
advantage in the rough weather of the North Sea where many fields are
nearing the end of their life. But over the ship's lifetime
decommissioning projects could take it to the Gulf of Mexico, South East
Asia and on to Brazil and West Africa.
The decommissioning market involves
everything from shutting down the field, closing the wells, removing the
steel and disposing of or recycling it. Design for lifting vessels has
changed little since the 1970s and only a handful of ships do most of
the work.
"I don't see the Schelte being anything
other than a one off, but by taking the risk they've cornered the market
in advance," David Thomas, analyst at Credit Suisse, said.
With oil companies delaying dismantling and
shutting operations as long as production remains viable, there are
uncertainties. Improving technology and fluctuating oil prices are
influencing factors.
"As I tell my boss I'm not the Grim Reaper,
I'm here to do a job but I'm not hovering to get it done any quicker
than is appropriate," said Austin Hand, project director for the
decommissioning of the Brent field at Shell, whose North Sea fields
produce over 12 percent of UK oil and gas.
DEAD COST
Decommissioning is a dead cost to oil
companies involving complicated procedures which come with environmental
risk, particularly because when the platforms were installed there was
little thought as to how they would be taken away.
"It's easy to look at the number of
installations in the North Sea and think it's bonanza time for oil
services, but it's incumbent on the industry to try and push back the
decommissioning date as long as possible and to maximize recoveries,"
Thomas said.
This has meant many service companies have
taken a more conservative approach than Allseas, but nonetheless do not
want to miss out.
Alan Johnstone, Europe Brownfield Director
at British engineer Amec, said decommissioning has been a small market
in the North Sea but predicts this is about to change.
The company is developing analysis of the
integrity of oil installations to predict how they will react when
lifted and dismantled.
"The decommissioning is becoming a more
consistent pipeline than it's ever been before," Johnstone said. "The
size of the prize here is significant," he said.
Oil firms are eager for services and
technology able to reduce time and cost of the process, an opportunity
for innovators. Norwegian equipment maker HydraWell, for example,
developed a system able to cut the time to plug and abandon a well,
major part of the decommissioning process, by 70 percent.
The UK government has stepped in to help
oil companies fund decommissioning with tax relief worth about 20
billion pounds over the next 30 years, a global first according to
British Chancellor George Osborne. The scheme is meant to free up
capital kept aside for decommissioning, to go into fresh exploration and
further production.
One result might be to delay
decommissioning even further, with oil firms using the money to chase
barrels in ageing fields with new technology and replacing equipment.
"From the supply chain side there appears
to be more appetite to extend the field life, with that certainty of the
decommissioning deed freeing up capital," Johnstone said.
Reuters (C) 2013
Post to be found at:
http://www.maritime-executive.com/article/Giant-Catamaran-To-Carry-Worn-Out-North-Sea-Oil-Rigs-Ashore-2013-10-11/
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