Frontier Energy, Issue 5

OIL, GAS & SHIPPING IN THE ARCTIC AND ICE-AFFECTED REGIONS

www.frontierenergy.info AUTUMN 2013

POLAR CODE Deadline 2016

Drillship Design ABS faces up to the challenge

STATOIL in Canada

OIL Spills

Expertise in ice

Prevention and cleanup

Gas Hydrates Frozen subsea energy

Arctic Safety Behavioural training

SeaRose FPSO

S T N G

ARCTIC VESSELS • TRAINING • INSURANCE • ENGINEERING

E TIN V E IS L

Register today for the E&P industry event for Arctic science & solutions 10-12 February 2014 Âť George R. Brown Convention Center Houston, Texas Âť ArcticTechnologyConference.org

CONTENTS

06

14

26

18

Autumn 2013 OIL, GAS & SHIPPING IN THE ARCTIC AND ICE-AFFECTED REGIONS

www.frontierenergy.info AUTUMN 2013

POLAR CODE Deadline 2016

Drillship Design ABS faces up to the challenge

STATOIL in Canada

OIL Spills

Expertise in ice

Prevention and cleanup

Gas Hydrates Frozen subsea energy

Arctic Safety Behavioural training

IN THIS ISSUE Features 06 POLAR CODE The International Maritime Organisation is working hard to write and publish its Polar Code, setting out the rules and regulations for shipping operating in Arctic and Antarctic waters

Sea Rose FPSO

ARCTIC VESSELS • TRAINING • INSURANCE • ENGINEERING

TS EN ING EVLIST

On the cover Icy waters around Greenland and (inset) the SeaRose FPSO operated by Canada’s Husky Energy

10 OIL SPILLS One of the greatest fears of companies exploring for hydrocarbons in the polar regions is an oil spill. Here we look at some of the technologies being used to prevent spills and minimise the impact of any discharges

14 CLASSIFICATION As the oil and gas industry evaluates harshenvironment operations, it becomes apparent that there are high hurdles ahead, writes James Bond, ABS’ Director of Shared Technology

16 GAS HYDRATES The first planned output of gas hydrates has begun in energy-short Japan, and the Arctic holds plenty of reserves

18 ARCTIC VESSELS Norwegian ship builder Ulstein is part of a growing trend involving established companies seeking to offer products and solutions that contribute to safer, smarter and greener operations in the Arctic Cover Photo: iStock and Husky Energy

20 STATOIL IN CANADA Norway’s giant oil company Statoil is bringing its harsh environment expertise gained in the Northern North Sea and Barents Sea to the east coast Canada

22 MARITIME ENGINEERING A team of Dutch maritime engineering students have worked with Damen Shipyards to create an innovative design for an LNG powered ice class supply vessel

27 ARCTIC TRAINING Canatec is a Canada-based company offering a range of training for energy and marine workers, and is expanding its international reach

Regulars 04 NEWS Canada’s Husky Energy has its White Rose project approved; Statoil announces Harpoon oil find offshore Newfoundland; Nordic Yards wins deckhouse contract; IMO chief takes five day Arctic trip

24 EVENTS Frontier Energy’s comprehensive events listing helps you plan your calendar and highlight your industries key upstream, shipping, scientific and research conferences, exhibitions and events

26 REMOTE BEHAVIOURS Good training that gives the right skills, knowledge and understanding of safe working plays a critical role in addressing behavioural safety issues, writes Harry van der Vossen, Chief Technology Officer, at Atlas

28 INSIGHT As demand pushes energy exploration into increasingly inhospitable geographies, the danger of a low-likelihood-but-catastrophic disaster rises and the requirement for more sophisticated risk management strategies becomes vital, according to insurance giant Marsh

www.frontierenergy.info AUTUMN 2013 01

A Wood Group Kenny Business

EDITOR’S LETTER

FRAM* I

“The first shots for the Arctic have been fired, both literally and metaphorically”

www.frontierenergy.info Editor Bruce McMichael editor@frontierenergy.info Publisher Stephen Habermel publisher@frontierenergy.info Design & Layout In The Shed Ltd www.in-theshed.co.uk © 2013 All material strictly copyright, all rights to editorial content are reserved. Reproduction without permission from the publisher is prohibited. The views expressed in Frontier Energy do not always represent those of the publishers. Every care is taken in compiling the contents, but the publishers assume no responsibility for any damage, loss. The publisher, Renaissance Media, assumes no responsibility, or liability for unsolicited material, nor responsibility for the content of any advertisement, particularly infringements of copyrights, trademarks, intellectual property rights and patents, nor liability for misrepresentations, false or misleading statements and illustrations. These are the sole responsibility of the advertiser.

Printed in the UK. ISSN 2047-3702 Published by Renaissance Media Ltd, c/o Maynard Heady LLP, Matrix House, 12-16 Lionel Road, Canvey Island, Essex SS8 9DE. Registered in England & Wales.

Company number 5850675.

mages of armed men clad in black, faces hidden behind balaclavas abseiling from helicopters onto the Arctic Sunrise vessel in the Pechora Sea made worldwide headlines in September 2013 as the Russian authorities lost patience with campaigners from the environmental group Greenpeace.

Around thirty protestors representing Greenpeace have been accused of piracy on the high seas as a result of the activists trying to clamber aboard at the Prirazlomnayal platform in the Pechora Sea. The scene was described by Greenpeace as follows: “The nearby Russian Coast Guard ship (responded) by launching inflatables manned with agents masked in balaclavas. They proceed to ram and slash the Greenpeace inflatables, threaten activists at gun and knife point and fire warning shots from automatic weapons.

Further, the remaining crew onboard the Arctic Sunrise count 11 shots fired across the bow from the Coast Guard vessel’s artillery cannon”.

Greenpeace says its protest against ‘dangerous Arctic oil drilling’ was peaceful and in line with its ‘strong principles’. A spokesman for the Russian authorities described the protest as ‘an attempt to seize a drilling platform by storm’ and said it raised ‘legitimate doubts about their intentions’. The ship ‘was loaded with electronics whose purpose was not clear’, he said.

Greenpeace International activist Sini Saarela was one of the protesters climbing the platform. She said: “This rusty oil platform is an Arctic disaster waiting to happen.

We’re hundreds of miles away from emergency response vessels or independent observers, but right next to a pristine Arctic environment that’s home to polar bears, walruses and rare seabirds.”

Article 227 of Russia’s penal code defines piracy as “an attack on a ship at sea or on a river, with the aim of seizing someone else’s property, using violence or the threat of violence”. It can be punished with a jail term of up to 15 years, depending on the gravity of the offence, and a fine of up to 500,000 roubles (£10,000; $15,000), reports the BBC. Let us hope that the Arctic Sunrise issue can be resolved safely and with the provisions of the UN Convention on the Law of The Sea are upheld allowing for safe passage in the open seas.

The first shots have been fired in the battle for the Arctic, both literally and metaphorically. With billions of barrels of oil equivalent believed to lie within the Arctic Circle, it’s a battle that looks set to intensify.

In a recent analysis released US-based independent organisation Pew Charitable Trusts detailed the Alaska-size challenges confronting oil companies that do business in the region and calls on federal regulators to impose baseline standards that would govern offshore oil and gas activity at the top of the world. “There should be consistent standards in regulation that every company operating in the Arctic needs to meet. It shouldn’t be discretionary, and it shouldn’t be what is recommended by the industry,” said Marilyn Heiman, a former Interior Department official who now serves as director of Pew’s U.S. Arctic Program.

The Arctic and its riches belong to the world and its development needs careful nurturing. Having a licence to operate in such environments requires that the views of groups such as Greenpeace and Pew are listened to, and respected.

Bruce McMichael, Editor

*

Fram is not only the Norwegian word for ‘Forward’, it is also the name of the one of the first ice-strengthened and most famous polar exploration vessels of the late 1800s and early twentieth century. It was captained by Norwegian explorer, Fridtjof Nansen, a Norwegian explorer, scientist, diplomat, humanitarian and Nobel Peace Prize laureate.

Sharing his polar travel experiences with fellow adventurers and scientists, his technology innovations in equipment and clothing influenced a generation of subsequent Arctic and Antarctic expeditions. The word encapsulates what we aim to bring you with the magazine – a forward looking guide to the future of oil, gas and shipping activities in the Arctic and other ice-affected regions while keeping environmental protection and safety at the heart of operations.

Get connected!

Follow us at www.twitter.com/frontierenergy for the latest news and comment

www.frontierenergy.info AUTUMN 2013 03

NEWS

Russian coast guards tangle with Greenpeace activists in the Pechora Sea

IN NUMBERS 0.0075% Stake purchased by Igor Sechin, ceo of Russia’s Rosneft in the company. Valued at

$5.5m

Gunshots were fired by Russian coast guard officials during a stand-off in the Pechora Sea as five activists attempt to climb the ‘Prirazlomnaya,’ an oil platform operated by Russian state-owned energy giant Gazprom platform in mid-September. Thirty activists, including Greenpeace members and two journalists from the ship, were sentenced to two months detention in Murmansk, where their ship, the Arctic Sunrise, is also impounded.

The activists were arrested them on suspicion of piracy, which carries a sentence of up to 15 years, after two scaled an offshore drilling platform. Russian official claim the Arctic Sunrise had violated the 500-metre security zone around the platform and that it “was carrying equipment whose purpose was still unclear”.

1959

BP’s first year of operation in Alaska

3.5 million

Number of people registered on Greenpeace’s Arctic campaign www.savethearctic.org

Artist’s impression of LK-25 icebreaker

Russian coast guards tangle with Greenpeace activists in the Pechora Sea

IMO chief Arctic trip IMO Secretary-General Koji Sekimizu spent five days on a Arctic sea voyage as part of a fact-finding mission to the region (See Polar Code feature on pages 6, 7, 8 and 9).

Mr. Sekimizu will be the guest of the Government of the Russia aboard the nuclear-powered icebreaker 50 Let Pobedy as she voyaged on the Northern Sea Route that links Europe and northern Russia.

Mr. Sekimizu will commence his voyage from the port of Dikson, in the Kara Sea, before undertaking a 1,680 nm trip to Pevek, in the East Siberian Sea. During the voyage, the vessel will transit the Kara Sea, Taymyr peninsula, Shokalsky Strait, Severnaya Zemlya archipelagos, Laptev Sea, Sannikov Strait, Novosibirskie Islands and the East-Siberian Sea. During the voyage, Mr. Sekimizu will see, at first hand, the effects of climate change on the sea ice coverage, and assess how the facilities and infrastructure needed for Arctic navigation are being developed along the Siberian coastline of the Russian Federation. www.imo.org

Image © Denis Sinyakov / Greenpeace. www.greenpeace.org

www.greenpeace.org www.gazprom.com

Deckhouse contract awarded Nordic Yards has won the tender for the construction of a deckhouse for a Russian icebreaker. The German shipbuilder will build the deckhouse for the icebreaker LK-25. The build was agreed by the St. Petersburg Baltic Shipyard, which is part of the Russian state-owned United Shipbuilding Corporation OSK, and Germany’s Nordic Yards. The deckhouse weighs 2,500 tonnes and will be fully fitted out. www.nordicyards.com

Wisting Central find for OMV Austrian oil company has struck oil at its Wisting Central exploration well (7324/8-1), offshore Norway, the first oil discovery in the Hoop-Maud Basin in the Barents Sea. Results of drilling, wireline logs and samples of reservoir fluids show that the well has encountered 50-60 metres of net light oil pay in good quality relatively shallow Middle to Lower Jurassic reservoir rocks.

The well was drilled by the Leiv Eiriksson semi submersible rig and is located approximately 170 kilometres northeast of the Skrugard/Johan Castberg discovery well and 310 km north of Hammerfest. The well was drilled to a total depth of approximately 905 metres in a water depth of 373 metres. Following significant data acquisition, the rig will move to drill the deeper and independent Kobbe prospect in the same production licence and will not appraise this shallower discovery.

The Wisting Central discovery is located in licence PL537 is operated by OMV (Norge) and holds a 25% interest while Tulllow Oil (20%) Idemitsu (20%), Statoil (15%) and Petoro (20%) are also partners. www.omv.com

04 AUTUMN 2013 www.frontierenergy.info

NEWS

23rd

Latest Norwegian exploration round, includes 44,000 sq. km in Barents Sea predicted to hold 1.9bn boe

2001

Year the University of the Arctic welcomed its first students (www.uarctic.org)

$2.1 trillion

307,257

POPULATION OF Russian port Murmansk, THE LARGEST CITY north of the Arctic Circle

Russia’s president Putin estimate of value of Arctic energy to the country’s economy

8

Arctic Nations - Canada, Denmark (Greenland & The Faroe Islands), Finland, Iceland, Norway, Sweden, Russia and USA. All are members of the Arctic Council

Between 1937 and 1991, 431,200 88 international polar crews established and Number of employees at Russia’s Gazprom

occupied scientific settlements on Arctic drift ice Sources: Greenpeace; Company sources; Wikipedia

Statoil light oil find offshore east coast Canada

The SeaRose FPSO in operation

South White Rose approved Canada’s Husky Energy has received regulatory approval for a development plan amendment for the South White Rose field, the third satellite extension at the White Rose field in the Atlantic Region.

The approval marks the latest step in the company’s strategy to maintain stable, high-netback production from the region while laying the foundation for the next stage of growth. The original South White Rose field development plan was approved in 2007, and the amendment provides for gas injection which will contribute to enhanced oil production and provide additional storage for recovered gas.

Husky is targeting approximately 20m barrels of oil from South

White Rose, and the amendment allows the Company to access an additional estimated 6.5m barrels of incremental production from the South Avalon Terrace on the southern tip of the main White Rose field.

South White Rose, located approximately 350 kilometres offshore Newfoundland and Labrador, will be developed via subsea tie-back to the SeaRose Floating Production Storage and Offloading (FPSO) vessel.

Development is well underway with gas injection anticipated to begin in 2013 and first oil production planned for 2014.

Husky is the operator of the White Rose field and the satellite extensions.

Norway’s Statoil has made a discovery of light, high-quality oil in the Flemish Pass Basin, offshore Newfoundland. Oil was encountered while drilling the Harpoon prospect (EL 1112), located approximately 500 kilometres north-east of St. John’s, Newfoundland and Labrador, Canada.

“While it is still too early to determine Harpoon’s resource potential at this time, this is very encouraging for the area and especially for the Bay du Nord well planned for later this year,” said Erik Finnstrom, senior vice president for Exploration North America in Statoil.

Finnstrom said that Statoil’s exploration strategy to test high-impact oil prospects in the Flemish Pass Basin is on target and that the Harpoon results will contribute to a greater understanding of the area.

“We anticipate there will be further appraisal drilling to mature this discovery in the future,” said Finnstrom.

“We will continue to build this area as a core exploration region for Statoil.”

The Harpoon discovery was drilled by the semisubmersible rig West Aquarius, in approximately 1,100 metres of water.

As part of its 2013 three-well exploration program offshore Newfoundland, Statoil is currently drilling its Federation prospect, located in the Jeanne d’Arc Basin.

The company will then return to the Flemish Pass Basin to drill the Bay du Nord prospect, which is located south-west of the Harpoon and Mizzen discoveries.

Statoil is the operator of Harpoon with a 65% interest.

Husky Energy is a 35% partner. www.statoil.com

www.huskyenergy.ca

WHAT ARE YOUR CUSTOMERS, POTENTIAL CLIENTS AND COMPETITORS DOING? Get YOUR free eNewsletter from Frontier Energy to find out!

SUBSCRIBE at www.frontierenergy.info TO ADVERTISE contact publisher@frontierenergy.com

Benefits • Exclusive news • Events calendar • Targeted audience

POLAR CODE

The Polar Code is vital for safer shipping operations

Countdown Safety of ships operating in the harsh, remote and vulnerable polar areas and the protection of the pristine environments around the two poles have always been a matter of concern for the International Maritime Organisation (IMO) and many relevant requirements, provisions and recommendations have been developed over the years. Today the IMO is working hard to develop a much-anticipated Polar Code

06 AUTUMN 2013 www.frontierenergy.info

I

n mid-2013 Koji Sekimizu, Secretary-General of the International Maritime Organization (IMO) took a five-day visit along the eastern sector of the Northern Sea Route aboard the Russian icebreaker 50 Let Pobedy to experience first hand the harsh environment that the proposed Polar Code, expected to introduced by IMO in 2016, would be governing.

Commenting on the code during his trip, Mr Sekimizu said that the principles of navigation for the two polar regions, which are recommendatory in nature, have already been approved. However, with the increase of navigation in the Arctic waters and passenger shipping in Antarctica, the IMO feels it necessary to impose a mandatory regime of navigational safety in both polar regions.

This Polar Code is much anticipated.

“We are preparing a mandatory code for polar navigation,” Koji Sekimizu, secretarygeneral of the United Nations International Maritime Organisation (IMO), says.

“It will be operational in 2015 (and) will probably be implemented in 2016.”

The code aims to ensure safe navigation in a fragile ecological environment, where search and rescue infrastructure is limited and distant.

Shipping along the Arctic northern sea route is set to grow more than 30-fold over the next eight years and could account for a quarter of the cargo traffic between Europe and Asia by 2030.

The IMO is currently developing a draft International Code of Safety for Ships Operating in Polar Waters (the Polar Code), which will cover the full range of design, construction, equipment, operational, training, search and rescue and environmental protection matters relevant to ships operating in the inhospitable waters surrounding the two poles.

The Sub-Committee on Ship Design and Equipment has been tasked with co-ordinating the work, reporting to the Maritime Safety Committee and the Marine Environment Protection Committee.

Photo: Shutterstock

STARTING

POLAR CODE

Photo: Shell

Loading LNG at Sakhalin Island, offshore eastern Russia, in icy waters

rescue or clean-up operations difficult and The move to develop the Polar Code costly. Cold temperatures may reduce the follows the adoption by the IMO effectiveness of numerous components of Assembly, in 2009, of guidelines for the ship, ranging from deck machinery ships operating in polar waters, which and emergency equipment to sea suctions. address additional provisions deemed When ice is present, it can impose necessary for consideration beyond the additional loads on the hull, propulsion existing requirements of the SOLAS system and appendages. and MARPOL Conventions, taking Whilst Arctic and Antarctic waters have into account the special conditions of a number of similarities, there are also polar waters and to ensure adequate standards of maritime safety and pollution significant differences. The Arctic is an ocean surrounded prevention are by continents maintained. while the Antarctic But, whereas the The code aims to ensure is a continent guidelines are surrounded by open recommendatory, safe navigation in a fragile seas. the IMO ecological environment The Antarctic membership has sea ice retreats agreed that the significantly during Polar Code would the summer season or is dispersed by be a mandatory instrument, setting out permanent gyres in the two major seas of internationally binding requirements the Antarctic: the Weddell and the Ross. appropriate for the severe environmental Thus there is relatively little multi-year ice conditions of the polar areas beyond those in the Antarctic, while in the Arctic sea ice already contained in existing instruments. survives many summer seasons and there is “A new code will govern all technical a significant amount of multi-year ice. requirements covering design and Whilst the marine environments of operations,” Sekimizu said. “It will both polar seas are similarly vulnerable, ensure the competence of seafarers … response to such challenge should duly We will ensure that unless we have take into account specific features of the trained competent seafarers on board legal and political regimes applicable to to navigate, then that vessel cannot be their respective marine spaces. allowed to navigate.”

Over the last 20 years or so, IMO Trends and forecasts indicate that polar has developed a raft of requirements, shipping will grow in volume and diversify guidelines and recommendations in nature over the coming years and regarding navigation in polar waters, these challenges need to be met without relating to maritime safety (construction, compromising either safety of life at sea or the sustainability of the polar environments. search and rescue, navigation, life-saving, Ships operating in the polar environments etc.) and marine pollution prevention (designation of special areas, carriage of are exposed to a number of unique risks. heavy fuel oil, etc.) as well as certification Poor weather conditions and the relative and qualification of seafarers on ships lack of good charts, communication operating in polar areas. systems and other navigational aids pose IMO’s draft Polar Code will cover the full challenges for mariners. range of design, construction, equipment, The remoteness of the areas makes

operational, training, search and rescue and environmental protection matters relevant to ships operating in the inhospitable waters surrounding the two poles.

A sub-committee on Ship Design and Equipment is co-ordinating the work, reporting to the Maritime Safety Committee (MSC) and Marine Environment Protection Committee (MEPC).

The move to develop a mandatory Code follows the adoption by the IMO Assembly, in 2009, of guidelines for ships operating in waters which are intended to address those additional provisions deemed necessary for consideration beyond existing requirements of the SOLAS and MARPOL Conventions, in order to take into account the climatic conditions of Polar waters and to meet appropriate standards of maritime safety and pollution prevention. The guidelines are recommendatory only.

Mandatory Polar Code timetable • MSC 86 in 2009 and approved proposals for development of mandatory Polar Code and instructed DE 53 • DE 53 started work in 2010 • Draft international Code of safety for ships operating in polar waters developed • Work is ongoing in Polar Code Correspondence Group, to report to DE 58 in 2014 • Inter-sessional Working Group planned for Autumn 2013 • Expected date of implementation - 2016 Source: IMO

www.frontierenergy.info AUTUMN 2013 07

POLAR CODE

Protection from heavy grade oils

Voyage planning The IMO Assembly in November 2007 adopted resolution A.999 (25) Guidelines on voyage planning for passenger ships operating in remote areas, in response to the growing popularity of ocean travel for passengers and the desire for exotic destinations, which have led to increasing numbers of passenger ships operating in remote areas. When developing a plan for voyages to remote areas, special consideration should be given to the environmental nature of the area of

Fennica, an ice class support vessel working in Polar-type environments

operation, the limited resources, and navigational information.

The detailed voyage and passage plan should include the following factors: safe areas and no-go areas; surveyed marine corridors, if available; and contingency plans for emergencies in the event of limited support being available for assistance in areas remote from Search and Rescue (SAR) facilities.

Cold temperatures may reduce the effectiveness of numerous components of the ship

In addition, the detailed voyage and passage plan for ships operating in Arctic or Antarctic waters should include the following factors: conditions when it is not safe to enter areas containing ice or icebergs because of darkness, swell, fog and pressure ice; safe distance to icebergs;

and presence of ice and icebergs, and safe speed in such areas.

Ship reporting The MSC, at its 91st session in November 2012, adopted a new mandatory ship reporting system “In the Barents Area (Barents SRS)” (proposed

by Norway and the Russian Federation).

The new mandatory ship reporting system entered into force on 1 June 2013. The following categories of ships passing through or proceeding to and from ports and anchorages in the Barents SRS area are required to participate in the ship reporting system, by reporting to either Vardø VTS centre or Murmansk VTS centre: all ships with a gross tonnage of 5,000 and above; all tankers; all ships carrying hazardous cargoes; a vessel towing when the length of the tow exceeds 200 metres; and any ship not under command, restricted in their ability to manoeuvre or having defective navigational aids. www.imo.org

NSA looks to High Arctic The challenges and opportunities in the Arctic are of global significance.

Nowhere else are the effects of climate change seen so quickly and clearly. Sustainable exploitation of these areas is more important and more demanding than anywhere else, says Sturla Henriksen, director general of the Norwegian Shipowner’s Association.

Three particular development areas in the High North are of special interest to Norwegian shipping companies. Energy extraction at sea, transport to Arctic destinations and transit shipping. Common to all three is that these operations take place under extremely challenging weather and working conditions, where operational expertise, technology and quality in all links of the value chain are essential.

The Norwegian maritime industry is a world leader in innovation and

08 AUTUMN 2013 www.frontierenergy.info

technology and already has notable experience and expertise in engaging in activities similar to those that will occur in the High North. A number of companies have under construction, or already in operation, specialised vessels and rigs adapted to working in the northern latitudes. Safe handling and shipping of oil and gas products is also an area where the Norwegian shipping companies have considerable experience.

“We need to continue increasing our knowledge and expertise concerning the challenges and opportunities area. The NSA believes that it is more important than ever that the Norwegian authorities position themselves so that our maritime competence can be used in the High North,” says Henriksen. www.rederi.no

Photo: Shell

A relatively recent MARPOL regulation, to protect the Antarctic from pollution by heavy grade oils, was adopted by the Marine Environment Protection Committee (MEPC), at its 60th session in March, 2010. The amendments entered into force on 1 August 2011.

The amendments add a new chapter 9 to MARPOL Annex I with a new regulation 43 which prohibits the carriage in bulk as cargo, or carriage and use as fuel, of: crude oils having a density at 15°C higher than 900 kg/m³; oils, other than crude oils, having a density at 15°C higher than 900 kg/m³ or a kinematic viscosity at 50°C higher than 180 mm²/s; or bitumen, tar and their emulsions.

An exception is envisaged for vessels engaged in securing the safety of ships or in a search and rescue operation.

POLAR CODE

BIMCO in the Arctic

T

he Baltic and International Maritime Council (BIMCO) is the largest of the international shipping associations representing shipowners, controlling around 65% of the world’s tonnage and it has members in more than 120 countries, including managers, brokers and agents, and thus has a significant interest in shipping activities in ice-affected waters.

The group believes that the Arctic area has potential to become an important trading area and that the special conditions call for special safety and environmental protection precautions for ships and says that “that a mandatory Polar Code is the optimal regulatory instrument to ensure that ships trading high latitudes are of the highest quality, built (strengthened and equipped) and manned to cope with the hazards of navigation in this extreme environment”.

BIMCO currently recommends that all crews on board ships operating in polar waters should have relevant experience and training, concerning inter alia: operating and handling a ship in ice; local regulations and recommendations; and safety precautions and emergency procedures.

Littoral states must provide up-to-date electronic navigation charts (ENC) for the Arctic areas in accordance with the adopted mandatory electronic chart display and information system (ECDIS) requirements.

However, until a mandatory Polar Code enters into force, BIMCO recommends that ships operating in Arctic and Antarctic waters comply with the IMO “Guidelines for Ships Operating in Polar Waters”.

Ice clause BIMCO issued its first Ice Clause in 1938 and has since 1954 provided ice information to its members. During the late 1990s BIMCO was deeply involved in the development of IMO’s ‘Polar Code’ later to be entitled: “Guidelines for Ships Operating in Arctic Ice Covered Waters”.

These guidelines approved by IMO in 2002 were recently subject to a thorough update in IMO. The title was amended to: “Guidelines for Ships Operating in Polar Waters”, which indicates that the guidelines also include the Antarctic waters and that many sections of the guidelines also apply to ice-free waters in the Polar region.

In recent years there has been an increasing interest in Polar Navigation for a number of reasons, the main one probably being the wider window for navigating in certain areas as a consequence of climate change. Both the Arctic and Antarctic are operationally extremely demanding areas for ships and even minor accidents could lead to consequential loss of lives and serious damage to the environment.

Navigating and operating ships in the polar areas is special for a number of reasons, not least that due to the weather conditions and the fact that the waters can be covered with ice. Aids to navigation in the polar regions are not, if at all, of the same quality found in the more traditional sea lanes.

Since 2006, BIMCO offered a course in Ice Navigation that includes Ice Classification and the Guidelines for ships operating in polar waters.

BIMCO participates actively in the work of the IMO Sub-committee for Ship Design and Equipment relating to the development of a mandatory code for ships operating in polar waters. www.bimco.org

ARCTIC JACK-UPS, DRILLSHIPS, SEMI- SUBMERSIBLES & VESSELS. GustoMSC is a renowned design and engineering company. The company specializes in the design of mobile units for the offshore oil and gas market as well as for the offshore construction market: jackups, semi-submersibles and monohull vessels such as drill ships. GustoMSC provides class approved basic designs and supplies associated equipment e.g. jacking, fixation and X-Y skidding systems.

www.GustoMSC.com

GMSC247 ad Frontier Energy 180x120 - Arctic FINAL2.indd 1

26-09-13 15:41

OIL SPILLS

DISPERSED

RESEARCH

W

hile these activities may seem like new developments, in fact Arctic oil exploration, and in some cases production, has been going on for about half a century.

“Hundreds of wells have been drilled in Arctic waters without any sustained, uncontrolled release of oil or gas. In association with these activities, decades of research have looked at all aspects of oil spill preparedness, oil spill behaviour, and options for oil spill response in the Arctic marine environment,” says OGP. Oil spill recovery plans must be approved by the appropriate regulators before operations can proceed, says the OGP. The objective in preparing for and in carrying out response to oil spills is to minimise damage to the Arctic environment and loss to the communities who depend on that environment. It is equally important to accelerate the recovery of any damaged ecosystem. Oil spill response is demanding under any circumstances. Arctic conditions impose additional environmental and

Recent years have seen increasing interest in offshore oil exploration in the Arctic and other frontier regions, says the International Oil and Gas Producers Association (OGP)

logistical challenges.

As an integral part of continuing oil and natural gas exploration in the Arctic, “we continue to address these challenges by improving our knowledge of Arctic conditions and by implementing programmes to protect people and

Oil spill recovery plans must be approved by the appropriate regulators before operations can proceed

the environment, says OGP. Therefore, operators include robust assessment and management systems that address specific risks. These systems incorporate contingency plans that are sufficiently flexible to provide a response appropriate to: • The nature of the operation • The size of the spill • Local geography • The climate and/ or weather conditions Investment and training are vital to minimise the expected over the period impact of oil spill in ice-affected waters of the response • The logistical challenges presented by remote operations It is also essential to identify personnel and equipment needed to execute a response, supported by training and maintenance programmes to assure readiness. The health and safety of the response team and the public are paramount. In the event

10 AUTUMN 2013 www.frontierenergy.info

of an oil spill, decisions on response options take into consideration: • Lessons learned from prior spill response efforts, from research and from Arctic operations • An evaluation of existing physical conditions • Biological and social sensitivities • Oil chemistry During this evaluation process, experts compare response options and take into account factors such as potential for lowest overall impact and most rapid recovery. The three primary options for oil spill response are in situ-burning, use of dispersants, and mechanical recovery.

Any final decision to utilise a particular response strategy depends on the spill conditions at the time and relative risks to response personnel and the environment.

In every case, monitoring and observation are crucial in providing real-time information on the size and direction of the oil – including the success of natural processes in breaking it up. Such close scrutiny enables us to adapt our response and ensure use of the best options at all times. The Arctic presents unique operational challenges: • Remoteness • Low temperatures • Seasonal darkness • Presence of ice However, research has also shown that Arctic conditions can work to our advantage in effective response. For example: • Cold water and sea ice can enhance response effectiveness by limiting the spread of oil and so allowing for more efficient in-situ burning • The window of opportunity for insitu burning and dispersant operations in ice-covered waters can expand

Photos: Shell

The 3,575 dwt offshore supply vessel Nanuq classified by the American Bureau of Shipping as an Ice Class A1 Oil Recovery / Platform Support Vessel and was chartered by Shell for its offshore drilling projects in the Chukchi and Beaufort Seas for supplies, ice management and spill response. Built in 2007 in Larose, Louisiana the vessel has an overall length of 301 feet, a beam of 60 feet and a hull depth of 24 feet.

Photo: BP p.l.c

OIL SPILLS

significantly when compared to equivalent spills in open water.

In response to incidents such as Macondo in the Gulf of Mexico and Montara offshore Australia, the OGP “worked to develop and implement recommendations to prevent well incidents in the first place and to improve our ability to respond in terms of intervention and clean-up. All of this was part of the Global Industry Response Group (GIRG). Although GIRG’s recommendations and action plans were not Arctic-specific, they enhance our overall ability to prevent and respond to oil spills around the world”. These actions include a Joint Industry Programme (JIP) to: • Improve co-ordination between key stakeholders internationally • Establish guidelines governing safe dispersant use • Promote research that advances understanding of response methodologies and risk assessment models • Enhance recommended practices for in-situ burning Another GIRG outcome was establishment of the Subsea Well Response Project (SWRP). It is focusing on ways to stem a well if the extensive physical controls already in place should fail.

SWRP will provide an improved capping response and is studying the use of subsea dispersants and the feasibility of global containment solutions. As part of the industry’s on-going research to improve Arctic oil spill response, companies including BP, Chevron, ConocoPhillips, Eni, ExxonMobil, North Caspian Operating Company (NCOC), Shell, Statoil, and Total have come together under the auspices of OGP to form the Arctic Oil Spill Response Technology Joint Industry Programme. Over the course of several years, this consortium will focus on: • Dispersant use in broken ice • In-situ burning • Mechanical recovery in sea ice • Remote detection/tracking, and modeling of oil spilled in and under sea ice. www.ogp.org.uk www.arcticresponsetechnology.org www.sintef.com www.subseawellresponse.com

BP remediation: a case study

I

n the early hours of 29 November 2009, a BP drill site operator working at the Lisburne oil field in Prudhoe Bay, Alaska, found a spill.

A 46cm pressurized pipe carrying crude oil, water and natural gas had split, sending the mixture across three-quarters of an acre of tundra. Fortunately, no oil had reached the waters or shorelines of Prudhoe Bay – and there were no reports of affected wildlife. Neither was there any significant ongoing liquid or gas release.

And due to the freezing temperatures, most of the 58,000 litres of oil and 131,000 litres of water congealed in a pile under the pipe.

Emergency response The spill response team was immediately dispatched to the area to assess how to clean-up the spill. The US federal government set up a Unified Area Command to manage the response effort and communications, made up of spill response team leaders, employees from BP Alaska, the Alaska Department of Environmental Conservation, the North Slope Borough and the US Environmental Protection Agency.

Industry oil spill response co-operative, Alaska Clean Seas, advised on the clean-up.

excavated around 352 cubic metres of contaminated soil, later sending it to the grind & inject facility for down-hole disposal. During this process, the soil is pulverized and injected deep into an abandoned oil or gas well. This means it cannot leach back up to the surface.

Restoring the tundra BP put a three-year plan in place to restore the areas affected by the spill.

The restoration began with teams transplanting tundra sod from a nearby mine site which had been earmarked for gravel extraction. They carefully handplaced thawed blocks of intact soil – with actively growing vegetation – onto the excavated areas. The teams applied the same method to tundra affected by the ice road, matching it to the elevation and grade of the surrounding tundra. To help nearby vegetation to recover, teams applied fertilizer in a 25-to-50 ft buffer around the spill site.

BP will continue to monitor the area for vegetation survival and cover, ground surface stability and wildlife use until 2015. www.bp.com

Recovering the oil Teams constructed an ice road to give heavy equipment access to the site. At the time, the tundra was covered with snow, so any visible oil could immediately be scooped up and removed. Clean snow was then packed onto the site to absorb any remaining oil, and the mixture of snow and oil was then taken from the site.

Clean-up also involved bringing in steaming equipment to loosen contaminated topsoil. This was then taken to another area for measuring. Crews

The BP-operated Trans Alaska Pipeline

www.frontierenergy.info AUTUMN 2013 11

OIL SPILLS

Tackling oil spills use booms offshore Alaska

Oil spill practice drill offshore Alaska

Oil in the sea of the oil is eliminated as gas, 1-10% as soot and 1-10% remains as a residue. Following the burning, this residue can be recovered from the water surface. Controlled burning is a proven response developed over several decades by the oil industry, emergency response authorities and scientists. This involved extensive laboratory and tank testing, large-scale field experiments and lessons from real incidents.

Burns can eliminate 1,000 barrels of oil per hour. Through tests over several decades, in situ burning has been proven to work well in the Arctic.

Dispersants

If a spill does occur, the rapid containment and recovery of oil at or near the source is the first goal. Mechanical skimmers can be used to remove oil from the water surface and transfer it to a storage vessel. Skimmers work most efficiently on thick oil slicks: floating barriers, known as oil booms, are used to collect and contain spilled oil into a thicker layer. A variety of designs for skimmer and booms have been adapted for Arctic sea conditions and several have been proven to work well.

Chemical dispersants are another method of cleaning up spills. They have proven highly effective in the Arctic through extensive testing.

Dispersants are like detergents designed for use in marine environments. They accelerate the breakup of oil slicks into fine droplets that can then disperse and biodegrade more easily in the sea. The use of dispersants offshore is generally recognised as an efficient way of rapidly treating large areas of spilled oil to reduce the impact on marine life and the environment. They can be applied from fixedwing aircraft, helicopters, and vessels.

Controlled in situ burning

Capping and containment dome

Oil on water or between layers of ice can also be tackled quickly, efficiently and safely by controlled burning. This technique works most efficiently on thick oil layers, so the oil needs to be contained by fire-resistant booms, ice or by a shoreline. On average, about 80-95%

Shell is commissioning the building of a subsea containment system that involves capturing and recovering hydrocarbons at source in the unlikely event of a well control incident in the shallow waters off Alaska. This recovery method has proved effective in shallow water,

Mechanical containment and recovery

and is expected to be ready for the 2012 Alaska drilling season. The containment system is designed to capture and recover oil and gas from an undersea well in the event of failure by the blowout preventer. The recovered oil would be transferred to a surface processing facility for separation of oil, gas, and water.

Recovery in Arctic conditions Shell has always recognised that a spill in the Arctic would pose special challenges.

But the low temperatures would also present opportunities to help contain spilled oil, slow its spread and provide vital time to respond with a variety of methods. When exposed to low air and water temperatures, oil tends to thicken, resulting in slower spreading and a reduced spill area. Cold water and ice can aid oil spill response operations by slowing oil weathering (the time it takes oil to emulsify) and reducing the action of waves to limit the spread of oil. Evaporation also slows down in cold temperatures and ice, allowing oil to retain its lighter and more volatile components longer and making it easier to burn off. When ice is too concentrated in an area for the use of a boom to contain the spill, it can act as a natural barrier that helps collect oil for recovery with skimmers. In the coldest temperatures, oil released under ice may become trapped within newly-forming ice. This oil is then effectively isolated from any direct contact with marine life or birds, and from natural processes such as evaporation and dispersion. The fresh condition of the oil, when later exposed, increases the chances of successful burning.

Source: Shell

12 AUTUMN 2013 www.frontierenergy.info

Photos: Shell

Natural seeps occur when crude oil leaks from beneath the sea floor into the water. They form the largest single source of petroleum in the marine environment, accounting for 45% of all oil in the world’s oceans. Seeps have existed for millions of years and are part of the ecosystem in many areas. There are natural seeps off the coast of West Greenland, off California, in the northern Mediterranean Sea, in the Caspian Sea and in the Gulf of Mexico.

These areas normally have a thriving marine ecosystem, despite the natural seep of a significant amount of oil into the water. Bacteria naturally present in the seawater feed off this oil and effectively biodegrade it.

KAZAKHSTAN

Kashagan starts up

T

he North Caspian Operating Company (NCOC) has a kick started production operations at the vast Kashagan field offshore Kazakhstan in the Caspian Sea. Pierre Offant, managing director at NCOC, says: “Preparations for start-up both onshore and offshore commenced in 2012 and progressed at a steady pace.”

Kashagan, which is due to start pumping oil, is the world’s most expensive oil development project, with its first phase alone costing $40.6bn.

Discovered in 2000, Kashagan is a supergiant field with 9-13bn barrels of recoverable reserves.

However, development has proved to be problematic, not least because its oil, contained in a high-pressure reservoir 4,200m below the seabed, is laced with highly toxic hydrogen sulphide gas. Also, the field is located in the northern part of the Caspian, where the sea is frozen for five months a year and prone to huge drifts of ice that would crush conventional oil rigs.

Due to the size and complexity of the project, the start-up of Kashagan is a long sequence of progressive steps leading to starting production and progressively ramping up to the intended levels. This long sequence of complex processes includes the completion of each unit, assurance that each unit operates safely according to design specifications, employee training and assurance that all production systems are operational.

Once all milestones have been completed successfully, the integrated system will receive the first oil and gas from some 4,200 meters below the North Caspian Sea. This will be delivered by eight wells on the artificial A Island. The wells and the pipeline system are ready for production, whereas the offshore production and treatment facilities on D Island are in the final stages of commissioning.

Onshore processing plant at Kashagan

At the onshore Bolashak Processing Facility, the preparations for start-up of the processing facilities have already been finalised some weeks ago with the initial introduction of so-called sweet gas from the Makat gas grid. Employing sulphurfree gas is a critical step before real gas and fluids from the production wells are

entered into the system. Along with the sweet gas introduction, the flare at the plant was ignited.

Over the course of 2013/14, production will be progressively ramped up to the design capacity from 180,000 bpd in the first stage to 370,000 bpd in the second stage.

CLASSIFICATION

Polar class

DRILLSHIPS

Moving exploration and production activities into frontier areas is fraught with challenges that are amplified when harsh weather conditions and sea ice are factored into the equation. As the oil and gas industry evaluates harshenvironment operations, it becomes apparent that there are high hurdles ahead, writes James Bond, ABS’ Director of Shared Technology

Alaska’s Pipeline Mileage Post at Prudhoe Bay where temperatures can dip to -45 °C

T

he majority of drilling activity in the Arctic has been in shallow water, but estimates indicate deep water holds significant reserves.

The US Geological Survey estimates approximately 90 billion barrels of oil, 1,669 trillion cubic feet of gas, and 44 billion barrels of natural gas liquids are yet to be found in the Arctic.

Approximately 84% of the estimated 412 billion barrels of oil equivalent is expected to be found offshore, and a sizable percentage of Arctic reserves lie in water deeper than 500 meters.

Exacting conditions According to the Energy Information Administration’s “Arctic Oil and Natural Gas Potential” report, approximately 61 large oil and natural gas fields have been discovered so far within the Arctic Circle, of which 43 are in Russia, 11 in Canada, six in Alaska and one in Norway. These are known fields, not estimated reserves, and they are in an area that presents some of the harshest temperatures in the world. The National Snow and Ice Data Center website lists winter temperatures for Prudhoe Bay, Alaska, as low as -45 °C (-50 °F), with temperatures in the summer falling between 3 °C and 12 °C (37 °F and 54 °F). In addition to the challenges presented by frigid temperatures, the central 14 AUTUMN 2013 www.frontierenergy.info

Arctic Ocean is ice-covered year round, which means offshore facilities have to be able to contend not only with very low temperatures, but with ice as well.

While there are rules and guidelines for the design of ocean-going vessels operating in polar conditions, there are no standards or guidelines available with a sufficiently robust design basis for stationary deepwater floaters that are intended to operate in ice.

For safe drilling activity to be carried out in the Arctic in the presence of ice, there is a need for an Arctic Class Drillship with a rating similar to the International Association of Classification Societies (IACS) Polar Class (PC) 4

There is a need for an Arctic class drillship notation. The problem is that the working environment of a transiting vessel is not identical to the working environment of a stationary unit. So taking the next step in Arctic drillship design is much more complicated than it appears to be on the surface.

Photo: iStock

Factoring mobile ice interactions into design

CLASSIFICATION

Photo: Shutterstock

Developing a PC4 drillship

Polar Class Descriptions

(based on World Meteorological Organization sea ice nomenclature) A PC4 notation is applicable to a ship operating year round in thick first-year ice that can include multi-year PC 1 Year-round operation in all Polar waters (old ice) inclusions. It is important to PC 2 Year-round operation in moderate multi-year ice conditions make the distinction that in the case PC 3 Year-round operation in second-year ice which may include multiyear ice inclusions of an ocean-going vessel, “operating” implies transiting through ice covered PC 4 Year-round operation in thick first-year ice which may include old ice inclusions. waters. Developed using ice interaction PC 5 Year-round operation in medium first-year ice which may include old ice inclusions. scenarios as a basis for the loads on and PC 6 Summer/autumn operation in medium first-year ice which may include old ice inclusions the structural design for each area of a PC 7 Summer/autumn operation in thin first-year ice which may include old ice inclusions hull, the Polar Class rules were validated against existing ships, particularly those The IACS “Requirements Concerning Polar Class” document provides requirements for machinery, including the main propulsion system, steering gear, and the emergency and essential auxiliary systems essential for the safety of that had suffered light damage during the ship and the survivability of the crew. operation. The PC notations have been assigned to offshore support vessels, a specific location – with or without ice loads by allowing the ship to drift with icebreakers and cargo carriers, but to management – is a critical component in the ice with the knowledge that as long date these have not been modified to the assessment. This prediction, however, as the ship is not driven aground, the address the very different operating continues to be a topic of research as the situation will likely resolve itself without environment that a stationary drillship guidance provided by current standards the need for icebreaker assistance. must endure while carrying out is lacking, and experience and design exploration work in the Arctic.

Drillship considerations validation points are limited. The focus of Because the operating conditions of research is on ice mechanics and structure/ an ice transiting vessel and one intended A drillship works in an environment ice interaction, numerical simulation of to be stationary in ice are very different, that is very different from that for which the understood physics and interaction the strength of different structural the Polar Class permutations all in support of load components must notations were prediction models that can be validated via be different as well. developed. An small- and large-scale testing.

Involving class in While there are Arctic drillship has Initial research has taken place, but limits imposed by to keep station with technology … will be critical much more work is needed to accurately hydrography and a fair degree of to this effort define the working environment for an the guidelines of accuracy, often in Arctic drillship and the loads to which the safe navigation, a regime of mobile vessel will be subjected. Application of the master of an ice. Because the the loads associated with an ice transiting ice-transiting ship has some freedom vessel is relatively immobile, pressure PC vessel notation for an Arctic drillship in selecting a route and speed through and ridged rubble fields can cause global would, in all likelihood, result in a ice that directly influences the ice loads loads that will be resisted by the mooring/ structural design that is incorrect for the on the ship. While it is true that a positioning system, creating substantially conditions and operating scenarios that vessel transiting ice-infested water will greater loads in the structure than a the drillship, as a stationary asset, would inevitably suffer ice impact, the master transiting ship has to deal with. encounter. Involving class in technology can steer away from large pieces of ice Ice management can lessen these loads, validation through an approval-into avoid collision. So the maximum but the reliability of the ice management principle process and novel concept global load on the side of a PC ship is system (ice detection, ice characterization, guidance will be critical to this effort. likely to be the result of the vessel being load prediction and physical management Class societies like ABS need to continue caught in pressure when an opening in capability and success rate) needs to be to work with industry to find solutions the ice closes. This type of load can be taken into account in the risk assessment that will help the industry push through particularly significant if the vessel is that accompanies a decision to continue the ice barrier. driven by wind against land-fast ice. With or cease drilling operations. Predicting www.eagle.org loads from a given ice interaction event at patience, the master can manage these www.frontierenergy.info AUTUMN 2013 15

Source: International Association of Classification Societies

Ice-prone seas present distinct challenges for drillships

GAS HYDRATES

Bergen, Norway and scene of intense research into gas hydrates

ICY INTEREST HOTS UP

D

eposits of gas hydrates – methane packed into a lattice of ice crystals – off the Japanese coast are probably sufficient to meet national energy needs for several hundred years.

So trial production by state-owned Japan Oil, Gas and Metals National Corporation (Jogmec) is also being closely followed internationally.

Looking like ice but catching fire when ignited, hydrates form under high pressure and low temperature. They are accordingly found in Arctic regions – including tundra – and deep water.

Half the output from Messojakha in Siberia, the world’s biggest gas field, has been provided by the melting of this hydrocarbon ice since 1970.

But the hydrate deposit was not known when the discovery came on stream, so the pilot project off Japan can claim to be the world’s first planned production.

Some researchers have estimated that gas hydrates could contain twice as much energy as all existing fossil fuel resources put together, including coal.

But the size of these deposits is uncertain, and they have to be very concentrated before extracting and utilising them becomes worthwhile.

Unstable One disadvantage of hydrates is that they are chemically unstable, and methane is a greenhouse gas with about 25 times the warming effect of carbon dioxide if

emitted to the air.

“These deposits are unique,” explains Bjørn Kvamme, professor of petroleum and process technology in the department of physics at the University of Bergen.

“Each is different from the rest.”

Hydrates melt on contact with heat and minerals, he adds. Their properties depend on local groundwater flows. That makes the picture far more complex than for oil and gas reservoirs.

But Kvamme notes that producing them is much simpler than extracting shale gas, for instance, where the rocks have tiny pores and low permeability.

“The oil industry has been sceptical, and has regarded hydrates as rather mystical. But it’s only a case of modifying technology already available.”

Big reserves in far north The Barents Sea probably contains big gas hydrate deposits.

Discoveries indicate, for instance, that these are found in the topmost 600 metres of the sub-surface around Skrugard and Havis.

This information comes from professor Jürgen Mienert in the department of geology at the University of Tromsø, who heads the Centre for Arctic Gas Hydrate, Environment and Climate (Cage).

Named one of Norway’s national centres of research excellence last November, Cage is working on methane hydrates as a potential energy source.

It also seeks to identify the role methane in offshore reservoirs and the

16 AUTUMN 2013 www.frontierenergy.info

seabed in Arctic regions might play with regard to tomorrow’s oceanic environment and global climate.

According to Mienert, a rise in sea temperatures could cause large volumes of gaseous methane to be released to the atmosphere.

Cage plans to map possible gas hydrates in north-eastern Svalbard, close to the Norwegian-Russian boundary in the Barents Sea. Seismic surveys are to be shot there, probably next summer.

And Mienert believes that the continental shelf north-east of Greenland could also be interesting, but sea conditions in these waters make access difficult.

Photo: Shutterstock

The first planned output of gas hydrates has begun in energy-short Japan.

This forms part of an urgent search for alternatives to nuclear power after the Fukushima reactor accident two years ago

GAS HYDRATES

Research on hydrate production has largely been pursued by geoscientists, Kvamme explains. But this work has been short of expertise on physics and flow dynamics.

Together with fellow professor Arne Graue, Kvamme has developed a technique to replace the methane molecules in hydrates with carbon dioxide through injection.

This makes the gas more stable and the methane easier to produce, while providing a carbon storage solution for this problematic greenhouse contributor.

Tested The method has been tested in Alaska and Canada in cooperation with ConocoPhillips and Jogmec – and with good results. But interest fell once shale gas made the USA self-sufficient in gas.

However, Asia remains very keen.

Kvamme and Graue do not know if the pilot production in Japan uses their technology.

Big carbon deposits in this part of the world would make it natural, though.

Gas from the Sleipner area of the North Sea contains about 10 per cent carbon dioxide, and this high proportion represents a problem.

The greenhouse gas is accordingly stripped out and stored in an underground formation. By comparison, gas from the huge Natuna field off Indonesia is 70 per cent carbon dioxide.

Indeed, hydrocarbon reserves throughout south-east Asia contain extremely high carbon proportions.

But the region lacks potential storage formations with good capacity and sealing properties.

“A market clearly exists for this

technology in Asia, where some countries have few energy resources but a huge demand,” observes Graue.

In addition to Japan, Malaysia, Indonesia, South Korea and India are making a heavy commitment to research into and pilot output of gas hydrates. If they succeed, much could be different.

This feature was first published by the Norwegian Petroleum Directorate in its Norwegian Continental Shelf journal (No. 1 – 2013), and is republished with kind permission.

Landslide A five-metre-high tsunami washed over the west Norwegian coast more than 8,000 years ago, unleashed by the massive Storegga sub-marine landslide on the Norwegian Continental Shelf.

Scientists believe that gas hydrates which had become unstable as the seas grew warmer at the end of last Ice Age contributed to the vast extent of this event. When the continental shelf began to give way, the areas containing such destabilised deposits were sucked into the landslide.

ARCTIC VESSELS

Further, deeper, colder with SX121

GC Rieber Shipping will add a subsea vessel of the SX121 design to its fleet in 2014

N

orwegian ship builder Ulstein is part of a growing trend involving established companies seeking to offer products and solutions that contribute to safer, smarter and greener operations, particularly in ice-affected areas. A case in point is the versatile and flexible OCV/subsea vessel design SX121, which Ulstein is currently building customised versions of for GC Rieber Shipping and Island Offshore. The design can be tailored for a multitude of offshore construction and subsea operations in deep and ultra-deep waters both below and above the Arctic Circle.

Deepwater and ultra-deepwater projects occur outside of the continental shelf at water depths between 400 and 1,500 metres and depths greater than 1,500 metres respectively. Deep waters mean remote locations, harsh weather conditions

The versatile and flexible SX121 design featuring a 400-tonne AHC offshore crane and a helideck that is positioned further back

Glossary: OCV

Offshore Construction Vessel

ROV

Remotely Operated Vehicle

RLWI

Riserless Well Intervention

IMR

Inspection, Maintenance, Repair

SURF Subsea Umbilicals, Risers and Flowlines AHC

Active Heave Compensated

18 AUTUMN 2013 www.frontierenergy.info

and sensitive ecosystems. This type of environment requires vessels that are reliable and safe, cost-efficient and environmentally sound.

“We aim to develop ships that can operate reliably, safely and efficiently in harsh conditions with as small an environmental footprint as possible. The robust configuration, system integration and X-BOW hull line of the SX121 ensure safety and comfort for the crew, an increased operational window and significantly reduced environmental impact,” says sales manager in Ulstein Design & Solutions, Lars Ståle Skoge.

Currently, there are four sailing SX121 vessels designed and built by Ulstein.

The vessels, which operate in different segments such as offshore construction, riserless well intervention and inspection/ maintenance/repair, have received positive feedback.

Optimised for heavier installations “The SX121 is a compact vessel that can perform deepwater and ultradeepwater operations for which currently larger vessels are frequently used, thus providing the customer with a more cost-efficient solution,” says Håvard Stave, Sales Manager in Ulstein Verft.

“The typical SX121 vessel operates at depths down to 3,000 metres, which comprises most current oil & gas activities. The need to deploy heavier equipment in deep waters such as offshore Brazil and Africa and in the Gulf of Mexico, has spurred market interest in OCV vessels with a 400-tonne crane, which we’ve now incorporated in the SX121 design.”

Ulstein has drawn on experiences from its latest SX121 projects, and optimised the utilisation of the hull with regards to work from deck as well as crane construction work, resulting in an even more versatile OCV/subsea vessel.

The robust platform is optimised for efficient operations in deep waters with

a crane capacity of up to 400 tonnes and a substantial remaining deck loading capacity, and it can be configured for a variety of mission equipment. There is a large deck area of 1,750 m², and the area around the main moon pool is reinforced in order to sustain a VLS or module handling system. The ROV installation is designed and chosen for operations in significant wave heights of 4.5 metres or more. Two heavy-duty work ROVs are situated in the enclosed hangar, one to be deployed from the starboard side, the other through a dedicated moon pool.

Extended redundancy A reliable vessel is key for costefficiency, as down-time and aborting on-going operations are costly affairs, particularly when operating far from shore. The SX121 vessel meets the highest standard for position keeping, DYNPOSAUTRO, with redundancy on all major components. Featuring the ‘Operation+’ concept, an increase in redundancy in AUTR operations if a single major failure occurs, the vessel will still maintain system redundancy throughout the most critical areas. The typical configuration is diesel electric propulsion powered by six identical medium speed main generator sets. The switchboard system, propellers and diesel motors can be configured in groups of two, three or four. If a major failure occurs, the vessel will only lose one third of its power and propulsion.

The combination of system architecture and power stations, three side thrusters and three main thrusters, ensures that the operation can be safely completed using two thirds of its capacity.

Main Particulars SX121 Beam

25m

Length

130m (typically)

Draught

8m

Deadweight

up to 10,000t

Photo: Ulstein

Advancement in technology is permitting the offshore oil and gas industry to move into progressively deeper and colder waters in remote locations, says Norwegian ship builder Ulstein

Get the latest information on technology advances, R&D initiatives and innovative approaches to oil pollution preparedness, prevention and response in Arctic regions y 3 r b 01 te 2 is er eg ob R ct to O up 8

1 VE SA

3rd annual conference on

00 £5 Frontier Energy subscribers receive a unique 10% discount to attend – quote VIP Code: FKA2383FEAD

Pioneering technologies and methods to mitigate environmental effects of E&P operations in the Arctic Thursday 14 & Friday 15 November 2013

Scandic KNA Hotel, Oslo, Norway DON’T MISS OuT ON THIS OPPORTuNITy TO:

Chairman

• Define the most critical factors in Arctic oil spill

Stephen Potter SL Environmental Research

preparedness

• Get the latest regulatory and legislative

Get the latest information on developments in the sector from leading experts including: Johan Marius Ly Director Norwegian Coastal Agency

requirements from Norway, Canada and Greenland

Per S Daling Senior Research Scientist SINTEF Materials and Chemistry

Jorma Rytkönen R&D Manager Finnish Environment Institute

Bruce Harland Vice President Crowley Marine Services

Lucy Short Senior Consultant Oil Spill Response

Mikko Niini Managing Director Aker Arctic Technology

strategies for safe operation

• Developing a logistics platform for remote drilling operations

• Get to grips with the latest developments in in-situ burning

• Examine the use of dispersants in polar environments

CASE STUDY: Goliat oil spill response

New for 2013!

• Regulatory Forum – Emerging Issues from Canada, Norway and Greenland • Panel Session – Developing community response operations in the Arctic • Industry Discussion – How can manufacturers help address some of the challenges faced by E&P companies?

• Environmental effects – experiences gained from oil spills in Norway Organised by

• Determine robust environmental protection

“First class, with high quality presentations”

Eni Norge will present their oil spill response solution for the Goliat oil field, the first producing oil field in the Norwegian part of the Barents Sea. Erik Bjørnbom Environmental Team Leader Eni Norge AS (Norway) Ole Hansen, Oil Spill Advisor, Eni Norge AS (Norway)

J MCMuRTRIE, ISCO

“Very good presentations, very pertinent. Great networking opportunities” V MITCHELL, LAMOR “Event was an excellent representation of the challenges and issues faced in exploration and drilling in the Arctic” J MOFFATT, TuLLOw OIL

Arctic oil & Gas

@IBCEnergyEvents

Series

For the latest programme or to register please visit www.ibcenergy.com/FKA2383FEAD or call the Bookings Hotline on +44 (0)20 7017 5518 or email energycustserv@informa.com

EnergyEventTV

STATOIL IN CANADA

Statoil sets sights offshore Newfoundland

N

orwegian energy giant Statoil is investing in the harsh, ice-affected waters offshore east coast Canada, attracted by its experience in operating in harsh, frontier environments. It’s knowledge of operating in the northern North Sea region has attracted interest from Statoil explorers who are investing heavily into the confirmed petroleum province and its highly prospective plays.

The company is already operator of four significant discovery licences (SDLs) and

Statoil is familiar with operating in the Barents Sea, knowledge it can bring to east coast Canada

seven exploration licences (EL) covering a total area of over 11,000 km². It is also a partner in four ELs. This acreage position strengthens Statoil’s exploration position in the area and demonstrates our commitment to achieving long-term growth offshore Newfoundland.

In June 2013, Statoil announced the discovery of light, high-quality crude oil at Harpoon in the Flemish Pass Basin, located approximately 500 kms northeast of St. John’s.

The deepwater Harpoon discovery

R&D investment Statoil is supporting local research and development (R&D) and developing education and training to facilitate the growth of the petroleum industry in Newfoundland and Labrador, as well as contribute to Statoil’s current and future activities.

The company aims to take full advantage of the sub-arctic environment and real-time laboratory offered offshore Newfoundland, with conditions such as pack ice, icebergs, and harsh weather.

“We view the experience we gain from the region’s remote and harsh environmental conditions as valuable to our local operations, as well as to other pan-arctic business areas.

The focus is to build competence through operational experience and strong, continuous R&D,” said a spokesman.

Statoil’s east coast office is increasing investments in Research and Development (R&D) in a number of areas including: the Statoil Chair and Associate Chair in Reservoir Engineering to foster the development of a new Petroleum Engineering program in the Faculty of Engineering and Applied Science at Memorial University, St John’s, Newfoundland; hiring two R&D positions, and an investment of up to $5 million in local Arctic R&D projects. www.statoil.com www.mum.ca

20 AUTUMN 2013 www.frontierenergy.info

is located 10 kms southeast of Statoil’s Mizzen discovery, announced in 2009 and estimated to hold between 100 and 200 million barrels of oil. Statoil’s activities in the Flemish Pass Basin are opening a new and relatively unexplored basin for the province. “While it is still too early to determine Harpoon’s resource potential at this time, this is very encouraging for the area and especially for the Bay du Nord well planned for later this year,” says Erik Finnstrom, senior vice president for Exploration North America in Statoil.

Mizzen was Statoil’s first operated exploration well offshore Canada. The Harpoon discovery was drilled by the semi-submersible rig West Aquarius to depths of about 1,100 metres of water.

Statoil believes offshore Newfoundland is highly prospective and is a leading exploration operator. In 2013, Statoil is operating a three-well drilling campaign in the Flemish and Jeanne d’Arc Basins.

Harpoon, where a discovery was announced in June 2013 and Bay du Nord, which will be drilled in later in 2013, are located in the Flemish Pass Basin. Federation, drilled in the summer months of 2013, is found in the shallow waters of the Jeanne d’Arc Basin. As a part of this drilling campaign, the company also supported its partner, Chevron, in its Margaree well, located in the Orphan Basin.

Statoil is the operator of Harpoon with a 65% interest. Husky Energy is a 35% partner.

Photo: Harald Pettersen, Statoil

Statoil is a major exploration operator offshore Newfoundland and has steadily acquired new exploration licences in the area since opening its doors in 1997

AEE 2013

SPE Arctic & Extreme Environments CONFERENCE & EXHIBITION 2013

O

Non-operating interests Statoil is partner in the producing fields of Hibernia (5%) and Terra Nova (15%), both situated in the Grand Banks, offshore Newfoundland. Statoil is partner in five production licences (PLs) and 28 significant discovery licences (SDLs).

Hibernia The Hibernia oil field is located approximately 315km east-southeast of St. John’s in 80m of water and uses the world’s largest oil platform, which consists of a 37,000-tonne integrated topsides facility mounted on a 600,000-tonne gravity based structure (GBS).

The Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB) estimates the proven and probable estimates reserves for the field at 1,395 million barrels of oil, making it by far the largest oil field offshore Canada.

Terra Nova The Terra Nova oil field is located 350 kms east-southeast offshore in water depths of approximately 100m and is the second largest field in production off Canada’s East Coast. It is the first harsh environment development in North America to use a Floating Production Storage and Offloading (FPSO) vessel, the Terra Nova FPSO. Field reserves for Terra Nova are estimated by the CNLOPB at 419 million barrels.

Hebron Hebron, like Hibernia and Terra Nova, is located in the Grand Banks of Newfoundland, approximately 350km offshore.

Water depth at Hebron is roughly 90m and the oil field is estimated to have recoverable resources at 400 – 700 million barrels.

The field was discovered in the 1980’s, and is going to be developed with a large Gravity Based Structure (GBS). The Hebron project, operated by ExxonMobil, is planned to start up in 2017.

Hibernia Southern Extension The Hibernia Southern Extension is the southernmost part of Hibernia and adds 223 million barrels of new reserves to the Hibernia field. It is a hybrid subsea tie-back to the main Hibernia platform.

Full field production for the Hibernia South Extension is scheduled to begin in 2015.

n behalf of the SPE Program Committee it is my honour to invite you to the second Society of Petroleum Engineers’ Arctic & Extreme Environments Conference & Exhibition 2013, which will be held 15-17 October 2013 in Moscow.

The Program Committee has invited and selected an attractive portfolio of papers in a variety of key technical categories and has arranged interesting speakers for the various Plenary, Topical, Technical and Knowledge Sharing sessions.

SPE A&EE 2013 is building upon the success of the previous event in 2011 and thus again is an international forum where scientists and engineers communicate their ongoing research, development and execution in the key areas of Geology and Geophysics; Drilling and Well Construction; Onshore & Offshore Field Development; Production & Reservoir Management; HSE & Social Responsibility and oil Spill Prevention. All of this with applications in the circum-Arctic while paying all respect to the people, the land and the sea of the circumpolar areas.

Through the support of Reed Exhibitions and generous Industry Sponsors SPE provides a worldwide platform for you to communicate and collaborate with industry colleagues, vendors and academia about challenges and solutions for the arctic regions. With a technical program of some 150 presentations, high quality speakers, networking events and an Arctic-focused exhibition area, this event provides opportunities for delegates to enhance their experience and share their expertise.

Within the three-day program there will be Plenary Sessions devoted to Sustainable Development in the Arctic and High North, Extreme Environments and HSE Challenges in Emerging Frontiers.

New, is the Undergraduate/Postgraduate Student Paper Contest and the Young Professional Special Technical session. The Exhibition area provides a perfect opportunity to network and share your views with anyone who has taken an interest in Arctic.

We hope that you will register for SPE A & EE 2013. Your participation no doubt will make this conference again a memorable success.

Looking forward to welcoming you in Moscow!

Han Tiebout SPE Program Committee member www.arcticoilandgas.com www.frontierenergy.info AUTUMN 2013 21

MARITIME ENGINEERING

The AMTSV can handle up to 1.6 m of level ice at a speed of 3 knots

LNG ICEBREAKER DESIGNED Concept for Arctic modular towing supply vessel

The vessel proposes external LNG storage

22 AUTUMN 2013 www.frontierenergy.info

F

Minor project. ‘Not taking the easy way out’, was an often heard quote while looking for a subject. One of the least easy challenges in Maritime Engineering seemed to be the Arctic, where a harsh climate hampers all operations and the danger of ice lurks at all times. Aalto University in Helsinki, Finland offered several academic courses on ice, and so were included in the project.

Five complementary partners In addition, the help of the industry was sought, turning the Minor into a combined project of shipbuilder Damen, risk management and classification company DNV, Dutch hydrodynamics and nautical research institute Marin and the two universities. The goal: the design of a new Arctic Offshore Support Vessel by combining the skills of all partners into a complete view on shipbuilding, from design to delivery.

The project contained three parts. First, a literature study was carried out, to get an overview of the environment, the market and the geography in the Arctic and to create an operational profile for the vessel. Secondly, a comparison study was held, testing three existing Damen

Images: Delft University / Damen Shipyards

Five Maritime Engineering students at the Delft University of Technology in the Netherlands, working with Damen Shipyards Group, have developed a design for an Arctic modular towing supply vessel as part of their degree studies

ive Delft University students working towards their Maritime Engineering degree course have completed an Arctic Engineering module, in which together with Damen Shipyards Group and other partners, a new Arctic vessel concept was created: the Damen AMTSV (Arctic Modular Towing Supply Vessel). The 100 metre, double acting supply ship is capable of operating in the Barents Sea year round and in the Baffin Bay and Beaufort Sea for eight months of the year. The AMTSV has the ability to sail through 1.6 metres of level ice at 3 knots.

The Toptrack programme of Delft University of Technology offers students the unique opportunity to organise their own Minor and fill it up with master courses. In this particular case students Reiner Bos, John Huisman, Martijn Obers, Tobias Schaap and Max van der Zalm organised their own Arctic

MARITIME ENGINEERING

vessels on their Arctic capabilities. The third stage consisted of a ship design, combining the experiences of the Arctic Minor Team into one innovative concept, launched this year.

Two bows The Arctic Modular Towing Supply Vessel (AMTSV) is capable of operating in Arctic waters for eight to 12 months, depending on the specific region. The vessel actually has two bows; when she sails through open water the accommodation will be in the front.

Through ice however, she will sail with her thrusters first. The ‘stern first’ concept is not new in arctic shipping. However, in this case it’s a veritable ‘double-bow’ vessel, a concept which is incorporated in the structural layout of the ship, allowing the AMTVS could be classed as such.

The AMTSV can handle up to 1.6 m of level ice at a speed of 3 knots. The research showed this to be an optimal solution, because the shape of an ice bow is completely different compared to an open water bow. When using two bows no compromises have to be made, says Damen. Another argument for this concept is that, while sailing through ice, the thrusters will create a flow around the hull that decreases friction. Because

the vessel can sail in both directions, is that it requires a lot of storage capacity. she also has to be capable of towing in However, ice strengthened vessels have a both directions. Hence a double acting lot steel weight in the hull compared to winch of 300 open water vessels tonne is installed. and this means This winch is that the centre of AMTSV could sail installed inside the gravity is relatively through 1.6 metres of level accommodation so low. Therefore the the harsh weather disadvantage is ice at 3 knots will not affect it. negated by placing No compromises the LNG tanks on on crew conditions top of the ESS. are made, by allowing the crew to The Arctic Minor project taught the work in the enclosed superstructure student team about co-operation, working (ESS) located behind the conventional in a foreign environment and most of all superstructure. This Arctic shipbuilding. For its part, Damen superstructure can be kept will incorporate their research into its own, up above zero degrees ongoing Arctic research programme. with an outside www.damen.com temperature of -55 www.tudelft.nl degrees C. The ESS is not only useful for the crew, but temperature The AMTSV can operate sensitive cargo can also in Arctic waters for 8 be kept in this area. to 12 months

External LNG storage This Arctic concept vessel will be running on liquid natural gas (LNG), with dual fuel engines, in an effort to make it more environmentally friendly. The main disadvantage of LNG

Main Particulars Basic functions

Arctic offshore supply, towing

Classification

Polar Class 4, WINTERIZED ARCTIC (- 35,-55), DAT (-35), Towing, Supply, DYNPOS AUTR, STANDBY VESSEL (S), Fire Fighter, Clean design

Dimensions

Propulsion system

Deck lay-out

Length o.a.

104.7 metres

Main engines

1 x Dual fuel 7.2 MW

Winch

300 t

Length b.p.p. open water

86 m

1 x Dual fuel 4.05 MW

Deck crane

3 t at 15 m

Length b.p.p. ice

94.4 m

2 x Dual fuel 2.7 MW

Beam mid.

21.5 m 11.1 m

Azimuthing Thrusters

2x Azipod 6.5 MW

Depth mid.

Draft design (base)

8m

Deadweight (summer)

6,050 tonnes

Open cargo deck area

775 m²

ESS cargo deck area

440 m²

Accommodation Crew/ special 35 personnel

Tank capacities

Survivors

150

Ballast water

3,550 m³

Fuel LNG (service)

1,050 t

Fuel oil (service)

950 m³

Fuel oil (cargo)

1,000 m³

Modular Cargo

Liquid Mud

1,300 m³

Oil recovery systems Moonpool

Speed (Level ice – 1.6 m) 3 km

Dry bulk

325 m³

Offshore Crane

Maximum ice thickness

2m

Covered Containers

25 TEU

ROV and Diving Support

Bollard Pull

140 t

Modular Containers

25 TEU

Fire Fighter 1

Deck load (1 m above deck) 4,500t

Performances (approx.)

Speed open water

14 km

Options

www.frontierenergy.info AUTUMN 2013 23

EVENTS

Arctic Futures Symposium October 16 – 17, 2013 Brussels, Belgium Held in Brussels, the Arctic Futures Symposium interdisciplinary conference sees prominent international policymakers, scientists, academics, Arctic indigenous peoples and industry representatives converge for open and frank discussions on the future of the Arctic.

Organised by the International Polar Foundation Arctic Futures the symposium provides members of the European institutions and the wider international community in Brussels with the opportunity to engage with Arctic stakeholders on issues such as marine transport and infrastructure, search and rescue capabilities, concerns of Arctic indigenous communities, scientific research and monitoring, ecosystem stewardship, and the sustainable development of the Arctic’s natural resources and economic potential. www.polarfoundation.org 2013 Arctic Energy Summit October 8 - 9, 2013 Akureyri, Iceland The summit is a multi-disciplinary event expected to draw several hundred industry officials, scientists, academics, policy makers, energy professionals and community leaders together to collaborate and share leading approaches on Arctic energy issues. www.arcticenergysummit. institutenorth.org Richness, Resilience, and Responsibility 8 – 10 October, 2013 Akureyri, Iceland The Arctic is sometimes described as the last frontier in the development of energy resources.

The Institute of the North’s Arctic Energy Summit will explore energy as a fundamental element of the sustainable development of the Arctic as a lasting frontier.

Central to this concept is how a focus on richness, resilience and responsibility will provide a pathway for sustainable energy development in the Arctic and for Arctic communities. www.institutenorth.org Iceland, Arctic Circle: A New, Global Assembly for Arctic Issues October 12 - 14, 2013 Reykjavik, Iceland The Arctic is melting, bringing both challenge and opportunity, and presenting a critical need for a conversation about the future.

The Arctic Circle, an open assembly for international cooperation on Arctic issues, will convene for the first time in Reykjavík, this October.

The Arctic Circle will serve as an open platform for institutions, organizations, forums, think tanks, corporations and public associations to lead discussions and events. www.arcticcircle.org SPE Arctic & Extreme Environments October 15 - 17, 2013 Moscow, Russia Access experts from throughout the E&P sector and gain insights from engineers, technical specialists, and industry leaders who will discuss, debate and develop the future potential of the Arctic frontier. www.arcticoilgas.com The 3rd Offshore Support Vessel Conference October 23 – 24, 2013 Håndverkerstuene, Oslo This event includes expert guidance from Technip Norge on equipping OSVs for ice-affected conditions and the opportunity to learn about OSV demand and deployment in Arctic regions. New design solutions to expand OSV capability and performance limits will also be discussed with expert insights from Ulstein International, MMC Ship Design, Salt Ship Design and Arctech. www.informamaritimeevents.com Subsea Vessel Operations North America November 11 – 12, 2013 Houston, Texas Programme highlights include: Harvey Gulf and DOF Subsea presenting on OCV demand and capability requirements in the Gulf of Mexico; Technip Canada and EMAS AMC discuss equipping vessels for ultra-deepwater and

24 AUTUMN 2013 www.frontierenergy.info

harsh environments while Hornbeck Offshore will speak on building Jones Act MPSVs for Gulf of Mexico deployment. www.informamaritimeevents.com IBC’s Arctic Week 2013 will incorporate the 9th annual Arctic Oil & Gas conference and the 3rd annual Arctic Oil Spill seminar this year, to share your knowledge and experiences with your fellow industry professionals.

9th Arctic Oil & Gas Conference November 12 – 13, 2013 Oslo, Norway Exploring opportunities and developing innovative solutions for safe operations in the Arctic and ice-affected 3rd Arctic Oil Spill Seminar November 14 – 15, 2013 Developing strategies to mitigate the environmental effects of operations in the Arctic. www.ibcenergy.com Design and Operation of OSVs for Ice and Cold Climates November 26 – 27, 2013 London, UK Understand the technical and operational challenges of cold climate offshore operations. www.lloydsmaritimeacademy.com An Essential Guide to Shipboard Winterisation November 28 – 29, 2013 London, UK A practical approach to effective winterisation of ice-going vessels, with speakers and delegates discussing. Everything from hull forms for OSVs to updates on the Polar Code. Several case studies dealing with new vessels for Arctic conditions will also feature in this event. www.lloydsmaritimeacademy.com PipeTech Americas January 23 - 24, 2014 Houston, Texas As public scrutiny of current and proposed pipelines increases, the onus is on pipeline operators to enhance safety and reduce spills.

Are you continuously improving your ILI tools? How are you controlling

corrosion? What are you learning from recent leaks? Attend the Pipe Tech Americas Summit 2014 to hear current case studies, find out about new technologies, and gain insight into industry trends. www.pipetechamericas.com 2014 Arctic Technology Conference February 10 – 12, 2014 Houston, Texas Arctic Technology Conference returns in 2014 and is operating with support from a multidisciplinary technical committee comprising geologists, geophysicists, engineers and academicians from the world’s top E&P companies and universities.

The conference will deliver a highly specialized technical program built around key topical areas including geology, geophysics and exploration and production. www.arctictechnologyconference.org 3rd Arctic Region Oil & Gas Conference Stavanger, Norway February 25 – 26, 2014 The 3rd Arctic Region Oil & Gas conference is an international forum that offers the industry’s perspectives on regional projects in the offshore Arctic. It also aims to serve the needs of oil and gas companies from across the industry value chain, operating or seeking to operate in the Arctic region. www.ar-oilgas.com 21st Caspian Oil & Gas June 3 – 6, 2014 Baku, Azerbaijan Caspian Oil & Gas is the largest and best-attended oil and gas event in the Azerbaijan and the Caspian region. The event is held annually under the patronage of the President of the Azerbaijan Republic, HE Ilham Aliyev and is officially supported by the Ministry of Industry and Energy of Azerbaijan and SOCAR. www.caspianoil-gas.com

TO ADVERTISE your event in the magazine, website or eNewsletter, please contact publisher@frontierenergy.info

6

GREAT REASONS to advertise with Frontier Energy

1 Targeted readership of senior decision makers 3 Distribution at key industry events 2 UNIQUE EDITORIAL PROGRAMME • • • • • • •

FPSOs Offshore support vessels Project focus Alaska Border disputes Ice technology Seismic

4 Industry leaders profiled 5 Key Arctic information and data 6 Linked to our exclusive eNewsletter!

Contact Steve Habermel NOW! publisher@frontierenergy.info

CHANGING BEHAVIOURS

Harry van der Vossen, Chief Technology Officer, at Aberdeen, UK-based e-learning experts Atlas

Improving behavioural safety in REMOTE REGIONS Good training that gives the right skills, knowledge and understanding of safe working plays a critical role in addressing behavioural safety issues, writes Harry van der Vossen, Chief Technology Officer, at Atlas, the Aberdeen, UK-based e-Learning and training providers

B

ehavioural factors account for up to 80% of incidents at work, according to the UK Health and Safety Executive (HSE). The role of ‘human factors’ has been recognised in the oil and gas industry for several decades and the HSE’s long-term aim is to improve the safety performance of the UK offshore oil and gas industry through the application of behavioural science knowledge and techniques at the individual, organisational and job levels.

Step Change in Safety, the industry body that aims to make the UK the safest place to work in the worldwide oil and gas industry, identifies several major incidents where human factors were found to have played a part, including the Texas City (Texas, USA) refinery explosion, the Longford Gas Plant, in Australia explosion – and the Piper Alpha disaster in the North Sea. The industry has made huge progress during the 25 years since Piper Alpha in improving workforce safety, and a large part of this progress has been recognising that a focus on design of jobs and workplaces could only achieve so much.

“Human rather than technical failures,” said safety expert James Reason in 1995, “now represent the greatest threat to complex and potentially hazardous systems”. If the improvement in safety is to continue, behavioural factors must continue to be effectively tackled.

Good training that gives the right skills, knowledge and understanding of safe working plays a critical role in addressing behavioural safety issues. As such, continued investment in health and safety 26 AUTUMN 2013 www.frontierenergy.info

training programmes to improve the competency of the workforce continues to be a key focus of the UK industry.

However, remote and challenging locations often lack the infrastructure to support classroom training. Here e-learning, developed online and delivered via The Cloud, comes into its own.

The effect of a changing workforce on safety The oil and gas industry is going through a rapid expansion phase; a phase that is not only leading to employment growth, but also to skill shortages.

The resulting demand for more skilled workers has increased churn rates as workers move globally to maximise benefits – a trend that has important implications for safety.

Today’s highly globalised oil and gas workforce results in teams that typically contain members from a wide variety of countries and companies, who have received training of a mixed nature and quality. Ensuring that there is a common and consistent level of safety knowledge within teams becomes challenging – but it is a critical challenge to address. There can be no two opinions about safe working.

These trends are driving a widespread need for greater standardisation of knowledge and training regimens, which is especially keenly felt in the newer regions of exploration where there is rarely a developed domestic labour pool to draw on and talent has to be imported.

Until recently there has been very little unification and standardisation within

the HSE training sector which is why we decided to develop our Minimum Industry Safety Training (MIST) for international use. IMIST (International Minimum Industry Safety Training), which was launched in 2011 to the estimated 1.5 million oil and gas workers worldwide, is an OPITO standard which supports the industry in meeting safety targets.

The programme has been developed to provide a new global standard for basic Health and Safety training, which is both comprehensive and consistent.

One of the most recent territories to adopt IMIST is Sakhalin Island, where it is being rolled out across the Sakhalin-2 project, one of the world’s biggest integrated oil and gas projects, to 2,000 staff and contractors over the next three years.

Language difficulties and safety Another behavioural safety factor arising from the more diverse and mobile workforce in oil and gas is the issue of language difficulties. The continuing growth of multi-language project teams has put greater pressure on an important link in the safety chain: effective communication.

English is the most popular language in the global energy industry, and functions as a lingua franca. But for many nonnative speakers, English is a second or third language, and proficiency levels vary widely. Even the relatively small differences between UK and US English, for instance, cause problems, since the meaning of words in one can be different in the other. Add to that the difficulties caused by accents, and the mechanical distortions caused to speech by audio

CHANGING BEHAVIOURS

Training gives the right skills, knowledge and understanding of safe working practices

equipment such as tannoy systems, and the problem is multiplied. For non-native speakers, getting by in such a diverse and confusing language landscape is not easy.

A study of Chinese oil and gas workers on offshore facilities in the South China Sea found that between 9% and 19% had issues in their comprehension of the English language. These ranged from difficulty in reading safety warnings and posters (9%) to inability to understand what was being said in safety meetings (14%). Worryingly, crews performing the high-hazard occupation of drilling had higher problems with language comprehension.

Generic language learning does not provide a wholly satisfactory solution to this problem. Testing and training

has to cater for the specialist technical vocabulary of oil and gas, as well as concepts and terminology specific to safety-critical situations. Our Safety English Test (SET), developed in partnership with Language Solutions International (LSI) was developed to specifically address these concerns. SET is an online English language test aimed at the oil & gas and energy industries that benchmarks employees’ English language competency in the specific context of safety.

Role of technology Both of these examples, IMIST and SET, use technology for delivery (although IMIST is human-invigilated). Technology

is playing a key role in meeting the training challenges thrown up by a rapidly growing global workforce moving into harsh and remote regions. Its two key advantages are scalability and consistency.

The volume of training need is increasing to a level that puts immense pressures on experienced classroom trainers to deliver by traditional means.

Technology-enabled learning (also known as ‘e-learning’) can augment existing classroom and practical training, leveraging human trainer resource and subject matter expert (SME) knowledge.

Guaranteeing the consistency of traditional classroom training has always been difficult. E-learning delivers a consistent learning experience and the use of assessment questions ensures that knowledge is tested and retained. It also allows the learning outcomes to be measured and retained electronically, for both competency and compliance purposes.

As oil and gas exploration pushes into ever more remote regions of the world, we can foresee technology playing an every greater role in helping to ensure behavioural safety, benefiting both the workforce and the environment. www.atlasknowledge.com

ARCTIC training Canatec works with Arctic offshore petroleum companies and shipping firms in ice-covered waters. Polar researchers and government regulators also use our instruments, software and ice consulting services.

The Alberta, Canada- based company delivers courses to companies who select a group of students of around 12-strong, or to groups of independent students.

Classes are currently delivered in Holland at the Willem Barents Marine Institute, although the company is working on agreements with another marine training institutes in Canada and the USA to deliver similar courses, and have access to training facilities in Kazakhstan for clients interested in the Caspian Sea. Classes for Northern Ice Observers can be given in the Arctic region.

The course is based on separate modules which means that the length of the course can be tuned to the

background skill and educational level of the participants. For Ice Advisors and Ice Navigators with no prior experience in ice, a course will take 10 days of formal group instruction; for Marine Engineers and Ice Observers the course is three days; for Northern Ice Observers, five days.

Vessels and offshore platforms operating in ice-covered waters require personnel skilled in observation, analysis and management of ice. Canatec offers training courses for: • Ice Advisors

People with science or engineering degrees, to take the lead analytical position in the field ice team.

• Ice Observers

Ship and air crew who need to provide data inputs from vessel and airborne reconnaissance stations at the offshore site, to the Ice Advisor.

• Northern Ice Observers

Indigenous peoples who are Marine Mammal Observers can also be trained to work as Ice Observers. Canatec supplies specialised data input devices and software designed to facilitate their work in complex industrial environments.

• Ice Navigators

Experienced mariners and ship pilots who may have some experience in ice, but need to learn more about the specialized type of operations in ice around petroleum installations • Marine Engineers

Officers and crew who will undertake ice reconnaissance, supply transits, icebreaking and iceberg towing. Canatec uses specialized, state of the art software and ice instruments for training in data acquisition, ice charting and ice/iceberg drift forecasting. www.canatec.ca www.frontierenergy.info AUTUMN 2013 27

INSIGHT The Arctic feels far removed from daily life

Vessels such as this ice breaker are under environmental scrutiny

Arctic insurance

Global demand for energy is expected to increase by 1.6% per annum over the next 20 years, representing a 39% increase on total 2011 consumption.

Arctic extraction Energy exploration in the Arctic is beginning to capture the attention of influential people across the globe, from the CEOs of major oil companies to the heads of environmental organizations. With the quantity of ice in the Arctic declining annually, both in terms of volume and surface coverage, oil companies could potentially access vast quantities of untapped hydrocarbons. Estimates suggest that the region currently has 136.6 billion barrels of oil equivalent (BBOE), and a United States Geological Survey report from 2008 estimates that a further 346 BBOE remain undiscovered.

Costs and challenges Despite the potentially vast untapped resources, the risk exposures from this frontier have hitherto been a natural barrier to entry. The conspicuous risks to companies stem from the climate and isolated geography of the Arctic — ice blocks, storms, engineering and electrical communication complications, and the limited availability of expertise in remote areas all pose challenges. Like deepwater drilling, exploration in this area requires significant investment.

Production income cannot be accounted for when factoring in debt repayments. Only 22 of the 174 fields discovered have produced hydrocarbons, with an average lag time of 13 years.

Just 38 new fields are expected to come into production between 2012 and 2018. This highlights the return on investment (ROI) question: Is it economically viable? Deepwater drilling has 28 AUTUMN 2013 www.frontierenergy.info

suffered at the hands of low oil prices, but Arctic exploration has the problem that 85% of the estimated reserves are natural gas (the majority of which is expected to be in the Russian segment). In looking at natural gas prices versus oil over the past 30 years, the commodity of oil has been significantly more valuable; coupled with the vast supply of gas emanating from shale, the Arctic begins to look like a less attractive frontier.

Other complications center on the extreme risk mitigation requirements for drilling in this region. For example, one must have a standby rig to drill relief wells in the instance of a blowout, significantly adding further costs to any exploration.

Also, reputational damage from a blowout in the Arctic would likely be irreparable, and inevitably followed by a moratorium on drilling in certain Arctic regions.

Despite the risks, it is expected that US$20 trillion will be spent in the region between 2011 and 2035.

Companies from Norway, Russia, Canada, and the US are expected to dominate this outlay.

If Arctic ice continues to retreat and engineering competence is advanced through technological improvements, exploration of Arctic reserves will become more likely and less expensive.

However, companies buying insurance to protect themselves in the event of blowout — operators’ extra expense (OEE) and against third party liability claims — face the task of careful market analysis. Typical offshore limits purchased in both these instances vary greatly from policies incepting in 2012 and companies in the Arctic may consider purchasing limits at the higher end of these scales.

Managing the risk Organisations should consider the following steps to address exposures associated with extracting energy in the Arctic amid a challenging environment: • Introduce an enterprise-wide approach to risk management to view and evaluate the risks of a field development. This approach allows an integrated and holistic view of likely risk exposures and opportunities, and helps to avoid assessing exposures in narrow silos.

• Apply quantitative risk analysis (QRA) techniques to identified risk exposures to add a degree of rigor and robustness to otherwise subjective assessments of impact and likelihood.

QRA can determine likely risk impacts at varying degrees of confidence and help evaluate the effectiveness of mitigation measures in controlling those exposures.

As demand pushes energy exploration into increasingly inhospitable geographies, the danger of a low-likelihoodbut-catastrophic disaster rises and the requirement for more sophisticated risk management strategies becomes vital.

Photo: iStock

W

ith population and income growth driving this surge, developing markets such as China and India are expected to account for the bulk of the energy demand growth. Although the fuel mix is expected to shift away from oil and coal towards renewables (mimicking the growth of nuclear power in the 1970s), renewables and other alternative sources are expected to account for less than a fifth of world energy use by 2030.

The dynamics of global supply and demand are changing as a result of a range of new sources (shale gas and oil, deepwater) as shown by the United States, which has recently become a net oil-product exporter.

A report (Managing Risk on the New Frontiers of Energy Exploration] by insurance giant Marsh (uk.marsh.com) examines the new frontiers of energy exploration, evaluating the changing risk landscape for companies involved in the exploration and production (E&P) of hydrocarbons from reserves previously untapped for a variety of reasons, ranging from intensive capital requirements to environmental objections.

NEW FRONTIERS! NEW TECHNOLOGY! NEW CHALLENGES! Frontier Energy is the world’s first magazine dedicated to the oil & gas and shipping operations in the Arctic and other challenging ice-affected regions.

Each issue will offer an exclusive insight into the technologies being used to overcome the challenges of this unique environment. Supported by a weekly e-newsletter, the magazine brings readers informative special reports and up-dates on all the latest developments.

• • • • • •

Geographic features Project focus Exclusive insight Special events diary New technology Politics and culture

Connect with your existing customers and reach new ones through the pages of the Frontier Energy.

For editorial enquiries, contact Bruce McMichael editor@frontierenergy.info For all advertising and sponsorship opportunities, contact Steve Habermel publisher@frontierenergy.info

Frontier Energy is your essential guide to these new markets!

www.frontierenergy.info

NEXT ISSUE Spring 2014

n y.i

fo

rg E e en SIT r e

ti EB n fro W

SPE Arctic and Extreme Environments Technical Conference and Exhibition 15 – 17 October 2013 All Russia Exhibition Center, Pavilion 75, Moscow, Russia c Over 1400 professionals from 26 countries* c Largest technical conference and exhibition dedicated to Arctic and Extreme Environments c Industry leaders offer insights into innovation and new technologies across 3 days on the exhibition floor c Featuring a Technology Incubator and Science Zone *Data from SPE Arctic and Extreme Environments 2011

Register now at www.arcticoilgas.com Organised by:

Energy & Marine

Sponsors: