Lamprell by East Coast Promotions

COMPANY PROFILE

2014

Lamprell

+971 4 8039308 | www.lamprell.com

Adding world records to an already impressive project portfolio Editorial: Christian Jordan

Lamprell is a leading provider of diversified engineering and contracting services to the onshore and offshore oil & gas and renewable energy industries. Recently the company has been awarded some major new contracts, completed milestone projects and even broken a Guinness World Record. CEO, James Moffat tells us more… In modern times, where traditional energy sources are constantly being challenged by new and inventive ideas, it is vital for the backbone of the industry – oil, gas, traditional renewables etc – to perform efficiently and be managed in way that maximises their potential. We PAGE 2

cannot afford to be wasteful and we cannot afford to be careless. So how do you go about taking full advantage of the potential of our energy sources? The first answer is of course through the use of modern technology and efficient equipment and this is where United

Arab Emirates (UAE) based Lamprell comes into its own. As one of the industry’s leaders for the past 35 years, Lamprell is a true market powerhouse. With approximately 10,000 people employed across multiple facilities, the London listed (LAM) company is not content when standing still; always looking to the future and always looking to build new relationships, Lamprell has become the ‘go to’ company when it comes to rig construction, diversified engineering and contracting services for onshore and offshore oil & gas and renewables, and the construction of shallow-water drilling jackup rigs, liftboats, land rigs, rig refurbishment and complex process modules and topsides. The journey to the forefront of the industry has been a long and winding one for Lamprell. The

Lamprell

company was started in 1976 in the UAE after members of the Lamprell family moved to Dubai and began focussing on small offshore energy sector projects. During its first 20 years in business, the company was involved in rig refurbishment and rig conversion, amongst other activities, and in 2000 Lamprell entered into the new build offshore construction market building its first topsides followed by new build jackup rig and wind farm installation market in 2007. The company’s main facilities, Hamriyah, Sharjah and Jebel Ali, are amongst the safest and most advanced in the world. Alongside Lamprell’s other facilities in Saudi Arabia and Kuwait, the group’s facilities cover approximately 910,000 m2 with 2.2 km of deep water quayside. With a strategy which has

continuous improvement as one its core elements, this is a business that is looking to the future and Total World Energy recently spoke to CEO, James Moffat to find out more about new contract awards and project successes which will drive the company throughout 2014 and beyond.

THE HYDRA We started by asking Moffat if he was happy following the recent delivery of a fourth self-propelled jackup vessel, Hydra, to Seajacks. “Yes we are, we held a naming ceremony in April which was attended by Seajacks employees and their investors. Guests were treated to a tour of the vessel and Seajacks senior managers reported that they were very impressed with Hydra and praised the strong working relationship between

Lamprell and Seajacks. In addition, once Hydra was delivered on June 2nd, Seajacks CEO Blair Ainslie,

“We have recently launched an initiative called Project Evolution in which we are investing $60 million which will allow us to improve our current yard layouts and fabrication processes” publicly commented ‘I would like to congratulate Lamprell on their delivery of the ‘Hydra’ ahead of schedule. In terms of quality she PAGE 3

looks to be the finest, with superb facilities on-board for our crews and clients. Both the Lamprell and Seajacks project teams have raised the bar yet again and this shows both companies commitment to continuous learning’,” he says.

“The company is determined that all aspects of our operations are managed sustainably, and are aware that environmental considerations are an important factor in business decisions” “These vessels typically have a lifespan of around 25 years,” he says. Lamprell has delivered four vessels

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for Seajacks in recent times but does Moffat expect the relationship between the two companies to thrive in the future? “Yes we do, Lamprell has shared an excellent working relationship with Seajacks over the years and the project teams have worked very closely to ensure projects were delivered on time and on budget. I am very proud of the high quality vessels that have been delivered to this key client and we would be happy to work together in the future.” And what exactly is it that sets the Hydra apart from her sister vessels who also operate in the North Sea? Moffat says that increases and advances on the previous models make this design the best yet. “In a joint collaboration between Lamprell and Seajacks, the Hydra underwent a substantial re-design compared to the three sister vessels we already delivered. This resulted in an enhanced jacking system, an increase in persons on board from 90 to 100, an increase in main crane capacity from 300 tonnes to 400 tonnes and improved automation and space management. During the vessel’s sea trials Hydra easily exceeded her contractual speed

of eight knots and performed well in all manoeuvring trials. All of the vessels we built for Seajacks have been specifically designed to work in the harsh environment of the North Sea and comply with the stringent regulations required to operate in that environment. The quality of the vessel and the fact that we have had no down time on previous vessels built for Seajacks is truly a great achievement.” The contract for the ‘Hydra’ was signed in July 2012 and delivery of this vessel represents the sixth jack up vessel of its kind to be delivered by Lamprell in total.

SHELF DRILLING Next, we asked Moffat about the contract awarded in May from a subsidiary of Shelf Drilling, for the construction and delivery of two high specification, LeTourneau-designed, self-elevating Mobile Offshore Drilling Platforms of a Super 116E (Enhanced) Class. The vessels will be fabricated in Lamprell’s Hamriyah yard, each will be capable of operating in water depths of up to 350 feet and will be used in constructing wells with maximum drilling depth of 30,000 feet. Also, each platform will be able

Together, we are

SMARTER SAFER STRONGER Guinness World Record for the Heaviest Load Moved by SPMTs. ALE are proud to have worked with Lamprell on this land mark project. ALE utilised five hundred and twelve axles of SPMT to transport the 13,191.98t PUQ deck in Jebel Ali, UAE.

WWW.ALE-HEAVYLIFT.COM INFO@ALE-HEAVYLIFT.COM

@ALEHeavylift

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WORLDWIDE HEAVY TRANSPORTATION AND LIFTING

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Guinness World Record for ALE’s 13,191.98t transportation in UAE

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In April this year, ALE’s transportation of a 13,191.98t PUQ deck in Jebel Ali, UAE was awarded the Guinness World Record for the ‘Heaviest Load Moved by SPMTs’. The award was confirmed and presented by the UAE Guinness World Records adjudicator Samer Khallouf at an event held at the Habtoor Grande hotel in Dubai. ALE utilised five hundred and twelve axles of SPMT to complete the transportation and load-out of the PUQ deck, which measured 98.5m long, 46m wide and 58.8m high. The deck was transported 883 m and took 4 hours for transport and 10 hours for load-out to complete. The PUQ deck was the largest offshore platform to have been constructed by Lamprell. It was loaded-out by ALE on 3rd of April bound for the Golden Eagle Area Development (GEAD) in the North Sea. In addition to the transportation and load-out, ALE provided a range of services including all engineering works, such as FEED studies and method statements, project management, mooring and assisting with the ballasting. ALE also conducted 3 weighing for the PUQ. James Moffat, Chief Executive Officer for the Lamprell Group declared “I am pleased to announce the completion and delivery of the second GEAD deck to Nexen, on time and within budget, to world class standards of safety and quality.” Richard Peckover, Executive Director – Middle East and Africa for ALE stated “We’re proud to have worked with Lamprell on this landmark project. The industry is continuing to see an increase in the size and weight of offshore structures and it’s great to see that ALE’s capabilities have enabled yet another record to be broken. Everyone involved worked tirelessly to ensure the success of the project and the teamwork between ourselves and Lamprell has accumulated in the achievement of this award” ALE delivers a highly tailored, end-to-end service covering every aspect of the handling, transportation and installation of heavy, indivisible loads, including lifting, transporting, installing, ballasting, jacking and weighing. The company’s strategic heavy-lift services are utilised in a wide range of sectors, including civil, oil and gas, energy, nuclear, offshore, renewables, petrochemical, ports, marine, minerals and metals and mining. ALE is headquartered in Staffordshire, UK, and has more than 30 offices across Europe, the Far East, Africa, America, South America, the Middle East and Australia. It is fully compliant with international standards of safety and excellence, including Quality standard ISO 9001:2008, Environmental standard ISO 14001:2004, and Health and Safety Standard OHSAS 18001:2007.

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to accommodate 160 people. “The contract is signed, we have agreed the schedule and specification and we plan to cut steel for the first rig in August,” he says. “LeTourneau built the first Jack up rig in the 1950’s, since then they have produced relatively simple, functional and highly reliable rigs. The rigs are not over complicated and are robust and popular with the drillers. “Shelf Drilling owns and operates the largest shallow water jack up fleet in the world and are based in Dubai, consequently we are focused on establishing a long lasting and mutually beneficial relationship. “When the first Shelf rig is delivered in Q3/2016 Lamprell will have previously delivered 16 rigs of the Le Tourneau Super 116E design, all delivered on schedule, so we see no reason that these rigs will not be delivered on or ahead of schedule. “There are many yards building new rigs, predominantly Government backed facilities in China and Singapore but Lamprell is currently producing more LeTourneau rigs than any other yard, and ranks about sixth in the world for volume of new build rigs under construction today.” This is a significant contract, valued at more than US$ 370 million and both rigs are being constructed for operations in South East Asia.

NATIONAL DRILLING COMPANY Lamprell’s relationship with Abu Dhabi’s National Drilling Company (NDC) is one of great mutual appreciation. The two companies are almost neighbours from a global energy industry perspective and in May, their relationship was cemented following the completion of construction on a further jackup drilling rig, and its delivery to NDC on time and on budget. This was the fourth rig delivered PAGE 6

by Lamprell to NDC and in line with a contract signed in 2011, two more are set to be delivered in the future. NDC CEO Abdalla Saeed Al Suwaidi said: “This new rig, similar to the previous three rigs already delivered by Lamprell, is a significant addition to NDC’s offshore rig fleet and will support our efforts in meeting our clients’ needs and expectations, now and in the future, by providing superior, competitive and quality services.

“We have a standard LeTourneau Super 116E design, this has been modified over recent years to accommodate machinery and equipment preferences from various clients and numbers of POB (People on Board) requirements, but the major characteristics and dimensions remain unchanged” “I would like to express my appreciation to Lamprell for their efforts and commitment to HSE and Quality.” We asked Moffat about the future between the two companies and the popularity of the Super 116 design. “NDC have been an outstanding client and the four LeTourneau 116E units delivered to date have fitted seamlessly into their Abu Dhabi

operational fleet. This makes for smooth sailing in a relationship with current and future demand running high. Due to political uncertainties and a consequently high oil price we are confident that there will be further orders from NDC. One major advantage for both parties is the nearness of their Abu Dhabi base to our fabrication facility, a mere two hour drive away,” he says. “The basic 116 design is over 35 years old and has been a workhorse of operators such as Rowan, Ensco, Transocean and Noble, all of whom still operate some of the older units today. Over the years the design was enhanced and upgraded to the 116S and 116C and eventually to the 116E in 2007. Up to that point a total of over 70,116 units had been built, more than any other individual jack up design, a testament to the characteristics and reliability of the 116 design. We will continue to actively market the Super 116E as an ideal rig for the Middle East & Asia region,” he adds. This new rig will be located in Abu Dhabi and the final two are expected to be delivered as planned in the late 2014-early 2015 period. This is the ninth Super 116E jackup drilling unit that Lamprell has completed for various clients during the last six years.

GOLDEN EAGLE Earlier this year, in April, Lamprell completed a major project for an important client, Nexen Petroleum. The company delivered a PUQ deck for the Golden Eagle Area Development (GEAD) in the North Sea. In 2011, Nexen announced that Lamprell would build two decks for the GEAD project. The first of the two decks, the wellhead deck, was delivered in June 2013 and completion and delivery of the PUQ deck was celebrated in April at

Lamprell a ceremony in Dubai. The GEAD project is a £2 billion investment, 70km off the coast of Aberdeen. This mega platform is significant as during its delivery it was officially labelled by Guinness World Records as the ‘Heaviest load moved by selfpropelled modular trailers (SPMTs)’. Weighing in at 13,191.98 tonnes the PUQ deck demolished the previous record of 4891 tonnes. Another milestone celebrated as part of this project was the completion of 10 million man-hours without a day away from work case. This was a new safety record for Lamprell and something which the company is understandably proud of. We asked Moffat about the hurdles that had to be jumped to achieve these milestones. “The tonnages resulting from the GEAD construction programme presented a step change for

Lamprell in terms of weight and required us to develop larger and more challenging single lifts that bring, as a consequence, a greater safety consideration. The volume and complexity of the PUQ also required our construction engineering resources to be aligned with the FEED developer early in the process in an effort to streamline the interface between conceptual engineering and construction engineering,” he says. “The resulting lift operations were executed safely and in best practice at all times. “Another challenge was to keep progress moving on schedule considering the difficulties that our client faced with free issue material and equipment delivery. We found ways to assist them by changing work sequences where necessary and absorbing delays which was highly appreciated.”

He also tells us that at no point was it a target to achieve a Guinness World Record; this came as an added bonus. “At that point in time the Project Management team saw an opportunity which we pursued and we really saw this as an additional good point to be added to our project portfolio. “The 10 million man-hours LTI free is highest HSE target ever achieved in the history of Lamprell. It was well recognised by Lamprell Executive Management as well as the client.” Of course, such a challenging project fosters close relationships between companies all the way up and down the supply chain. “As with any North Sea operator, taking new developments from concept into FEED development and ultimately into construction and production is a timely process.

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major characteristics and dimensions remain unchanged.” As part of the contract, Ensco has options for Lamprell to build two more jackup rigs. If taken up, the option would see the construction of two rigs of the same design. These options are exercisable within a period of six months from the effective date of the contract.

PROJECT EVOLUTION

Lamprell believes that the experience gained and the achievements delivered on Nexen should place us in an excellent position to bid in a competitive environment for future work. We have a very strong relationship with Nexen after the many successes achieved on this project we hope that we will be considered as a preferred contractor in the future,” he says. The PUQ deck for the GEAD project was the sixth offshore fixed topside that Lamprell have delivered since 2010 and it was delivered on time and in budget. Lamprell have loaded out similar structures in the past but this was the largest offshore platform constructed by Lamprell with a total weight (including the grillage, temporaries and SPMTs) of 15,511 tonnes and dimensions of 98.5m by 46m by 58.8m.

ENSCO Another significant contract for the PAGE 8

company was received in April when Ensco Intercontinental GmbH, a subsidiary of Ensco plc, awarded Lamprell a job to build and deliver two high specification, LeTourneau - designed, self elevating Mobile Offshore Drilling Platforms of a Super 116E (Enhanced) Class. Similarly to the Shelf drilling contract, the rigs will be constructed at the Hamriyah yard and delivered in Q2 and Q3 of 2016. Valued at around US$390 million, this is again an important contract and Moffat says that first steel cutting will take place this month. “The contract with Ensco has been agreed and signed, steel cutting for the first unit, Ensco 140, will take place in July. The Ensco project team is in place and the project is up and running. “We have a standard LeTourneau Super 116E design, this has been modified over recent years to accommodate machinery and equipment preferences from various clients and numbers of POB (People on Board) requirements, but the

Lamprell is certified to ISO 9001:2008, ISO/TS 29001:2010 and API Q1 Quality Management System standards. In addition, the company also holds various American Petroleum Institute product licenses and American Society of Mechanical Engineers (ASME) standards. The Hamriyah, Sharjah and Jebel Ali facilities are certified to ISO 9001:2008 and ISO/TS 29001:2010 standards and of course, a quality facility makes a quality product. But Moffat does not want to sit on this success. While he recognises the quality of the facility, he is keen to expand and improve. “In regards to safety and quality our yards are some of the top tier yards in the world which is reflected in the workforce that we have. “We have recently launched an initiative called Project Evolution in which we are investing $60 million which will allow us to improve our current yard layouts and fabrication processes. We are upgrading to modern production equipment such as automatic beam fabrication and cutting, and a modernised panel line for example,” he says. Project Evolution is all about becoming more competitive. Lamprell established a dedicated team tasked with implementing productivity improvements and cost efficiency activities which will see them capture more business.

SUSTAINABILITY

Lamprell The last area that we quizzed Moffat on surrounded sustainability and the environment - buzz words on the lips of many industry critics. Are there any companies operating in the oil & gas industry who can really claim to be ‘green’? Well, simply put, yes. Perhaps claiming more of an emphasis today than 20 years ago, being green has changed. Today it’s not just about reducing carbon emissions; it involves a top-tobottom focus on sustainability, a focus which has to be instilled throughout the entire workforce and embedded into the culture of an organisation. Moffat says that the issue of sustainability is one that is being addressed by Lamprell and one which will continue to receive attention in the future. “Like many organisations, you have to make an unremitting commitment to environmental management, the journey has to begin somewhere and that is what Lamprell did. In 2013 we hired Alan Robson, our new VP of HSES and committed to getting all of our three main fabrication facilities accredited to ISO14001. “The company is determined that all aspects of our operations are managed sustainably, and are aware

that environmental considerations are an important factor in business decisions. We remain focused on carbon emissions, energy efficiency, waste management, recycling, water consumption and use of low-carbon or renewable sources of energy. We also recognise that sound environmental management improves efficiencies and contributes to company profitability. “The definition of ‘environmentally friendly’ is open to several interpretations. My view is that we can be environmentally friendly. The important factor for Lamprell is to commit to implementing sustainable environmental programmes that deliver tangible environmental improvements.”

THE FUTURE With all of the previously mentioned projects providing Lamprell with a strong pipeline of work for the future and the company becoming more and more focussed on sustainability, there was one more issue that we wanted to discuss with the CEO. Recent reports have suggested that global oil companies are increasingly turning to China for services and equipment, attracted by lower costs and a newly acquired expertise that is challenging more

established rivals. State-run and privately controlled Chinese rig makers, oil and gas service and engineering firms are showing up in the supply chain everywhere from the Middle East, the North Sea and North America to less traditional areas like Mozambique. So should Lamprell be concerned? Moffat says that, to date, only two of the established drillers have turned to China for jackups and this is a good sign for the industry in the Middle East. “Chinese yards today have a total of 74 jackup rigs under construction, surpassing Singapore for the first time and offered back ended payment terms. This attracted a large number of orders over recent years mostly from speculators and Capital Investors, none of the established drillers, except for Seadrill at Dalian, have ordered in China.” With this is mind, the future looks bright for Lamprell and also for its many customers, clients and partners in the region. As we move through 2014, we will undoubtedly see more projects completed, more orders taken and the growth of a reputation which really sets this innovative company apart from the chasing pack

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