A new breed of subsea craft is helping reap the benefits of an upbeat decommissioning industry, writes Selwyn Parker
The North Sea will likely deliver more work for the world’s subsea fleet than any other region in the next few years, as hundreds of platforms are dismantled in the biggest decommissioning exercise the oil and gas industry has ever seen. And most of this action will take place in the UK Continental Shelf (UKCS).
No less than 60% of North Sea wells due to shut down within the next eight years are located in the UKCS, according to UK Oil & Gas. These platforms are steadily being broken up with the support of the subsea fleet.
Although the fleet is also involved in exploration and will continue to be so for many years, decommissioning will be its primary business line in the foreseeable future. Between 2017 and 2025, UK Oil & Gas estimates £17Bn (US$22.5Bn) will be poured into decom contracts in the North Sea.
Right now, the dismantling of the Janice subsea field is heading for completion on time and under budget by mid-2018. Lying 170 miles east south-east of Aberdeen, it is one of the biggest “decom” exercises to date. Some of the steel and concrete has been sitting on the seabed for 15 years, up to 120 m down.
Like other big-ticket decom projects, the decom industry is honing its skills with each dismantling operation. According to UK Oil & Gas estimates, the cost of unbolting and shipping infrastructure back to land for breaking up has fallen by 30% in the last couple of years.
One way and another, whether it is exploration or decom, the subsea industry will be kept busy. That is why GE-owned Baker Hughes announced in May that it will build a subsea manufacturing campus in the north-east of Scotland.
In May Subsea 7, one of the giants of the industry, bagged a heavyweight contract from Norway’s Statoil that will keep its flagship vessel, the Seven Viking, busy for at least five years, starting from January 2019.
A “life-of-field” ship, the US$181M Seven Viking provides a timely example of the technical progress made by subsea inspection, maintenance and repair (IMR) vessels in the last few years. Bristling with technology, the vessel is designed to operate in the kind of severe conditions typical of the North Sea. It comes complete with work-class and observation-class remotely operated vehicles (ROVs), while its helideck can land a SuperPuma and Sikorsky S-92, one of the workhorses of offshore exploration. There is also a main active heave-compensated crane, a 135-tonne deck lift and five auxiliary telescopic folding cranes.
The human element has not been neglected. Two 48-person lifeboats have been installed, along with two marine evacuation chutes and a fast rescue craft. It can accommodate 90 people, mainly in one-bed cabins, and offers hotel and hospital and a variety of recreational rooms, including a movie theatre and a gym.
All this has been packed into a relatively small vessel. At a length of 106.5 m and a width of 24.5 m, the Seven Viking is unusually compact, a virtue that allows it to operate in the confined spaces between offshore platforms and other areas that are difficult to access.
A new breed of IMR
The latest breed of IMR ships has moved up a step or two since the industry’s slump, in part because the offshore industry demands the latest technology as it pursues low-cost production of oil and gas. But these new vessels are not cheap; in late 2017, the US$378M Khankendi, a brand-new subsea construction vessel built for the BP-run Shah Deniz consortium, took up duties in the south of the Caspian Sea, about 45 miles off the coast of Baku, Azerbaijan.
These hefty investments are justified by the length of the contract. Designed by Keppel Offshore & Marine, the 155 m long, 32 m wide Khankendi will be transporting and installing deepwater subsea production equipment and other hefty structures for the next 11 years in the Shah Deniz field.
Among other advanced technology, the Khankendi calls on the latest dynamic positioning systems that can keep it on station in waves up to 3.5 m. Its main crane is a special advantage offshore. Weighing 900 tonnes, it can lift structures of up to 750 tonnes over the side and place them 600 m below the waves. It also boasts a two-bell diving system that can take up to 18 people down below on underwater inspections.
And because of its dynamic positioning technology, the Khankendi can perform all these tasks without the need to throw out anchors.
Even during the downturn, the marine design industry never stopped improving its vessels, notably in the area of hull design. Today, IRM vessels are being constructed that feature the inverted bow concept. Known as the X-Bow, it was developed by Norway-based Ulstein and has proven a boon in rough waters such as the North Sea (Seven Viking also has an X-Bow). The principle is that by putting the most forward part of the bow down below, instead of the other way around, the vessel is given a more sea-kindly action that reduces slamming and also provides more volume on deck (an all-important attribute when so much must be crammed into a small space).
One of the latest X-Bowed IRM vessels is the Dutch-owned Acta Auriga, that has been custom-built for the offshore renewables industry. Put to work for the first time in May, the Acta Auriga also features the X-Stern, a later development by Ulstein that is rapidly becoming standard in the design of IRM vessels. So impressed was Acta by the performance of the Auriga that the group has ordered a sister ship from the Ulstein shipyard.
The market for late-technology IRMs and other subsea vessels is recovering from what energy consultant Wood Mackenzie’s analyst Caitlin Shaw described last year as “one of the most brutal downturns in recent history”, classifying it as “a perfect storm of challenges for the overall offshore market”.
The industry used the interim period well. As Wood Mackenzie explained, “[it] closely examined how it executes subsea projects to understand how it can further increase efficiency, return and recovery.” This observation particularly applies to deepwater project, where costs and risks are substantially higher than in shallow waters.
Collaboration has become a buzzword in the recovery sector. In one of scores of similar examples, Aberdeen-based Enpro Subsea and DOF Subsea have recently agreed to work together to mutual advantage. The latter will deploy Enpro’s patented technologies from its 26-vessel fleet of construction and intervention vessels, mainly in the Atlantic.
As DOF chief executive Raymond Semple explained, collaboration is all about pooling resources for the best possible advantage in the new low-cost era: “Enhanced recovery is a crucial element of our industry’s continuing efforts to effect sustainable improvements to subsea project economics.”
As Mr Semple implied, the subsea fleet that is being called into action once again is far removed from that which entered the downturn; by sharing technology it can reap the benefits of more affordable hydrocarbons.