Twe October

OCTOBER 2014

more than business

Atlantis’ power is no myth Atlantis Resources is getting ready to install the world’s largest tidal stream project off the Scottish coast in the Pentland Firth. The MeyGen project will provide clean energy to over 175,000 homes. CEO, Tim Cornelius tells Total World Energy more about this unique project and exciting organisation…

Reef Subsea On top of the bottom line

Shelf Drilling

Focussed on shallow water

Teekay Petrojarl Welcoming the Petrojarl Knarr

Boskalis Singapore A driver of economic development

www.totalworldenergy.com

mjc-metal A/S – your local subcontractor, with international relations.

MJC Metal has its headquarters in Esbjerg, Denmark, from there a large number of international companies are serviced. A substantial part of the activities are targeting the oil industry’s activities in the North Sea. All processes in MJC Metal are onshore based and often take place in our own workshop. MJC Metal has, by virtue of highly qualified employees and a unique machine park, the skills to perform complex machinery.

We have a very high level of service, which among other things means that we are solving tasks based on customer specifications. We often see very complex issues with high tolerance requirements, says Production Manager Tommy Georgsen.

Our expertise has been developed in order to remain a long-term and reliable supplier in the oil industry - but is also used in parallel to a number of other customers. Overall, we cover a wide range, from one-off production to the production of large series.

complete package offering With plans for further growth, we are always on the look-out for new clients, says CEO Jørgen Nordstjerne Schmidt. Therefore we strive to always be best in class, and offer a complete package to our clients. Together with our local partners we have the possibility to offer a complete package, from rough-machining to coating, including inconel or other cladding, heat treatment, final machining, 3D measuring and a full “as-build” documentation package. High competences and accountability are key elements of MJC Metal.

Renovation or new build MJC Metal is a key player when critical components from the North Sea are to be renovated. There are many vital and expensive parts, which can have their lifetime extended significantly through a renovation process. This is one of the company’s core competencies.

In addition to critical renovation, MJC Metal also produces new components based on customer specifications, which are often very complex issues with high tolerance requirements in special highalloy steels.

“We are proud to make a difference for our clients, both in cost and lead time.

MJC Metal has in recent years invested in state of the art equipment, which has improved our lead times significantly” - Jørgen Nordstjerne, CEO

• Advanced machinery • The most skilled industrial technicians • From single pieces to serial production

Stenhuggervej 13 6710 Esbjerg V. Denmark Tlf.: +45 7514 0400

www.mjc-metal.dk

One of things we hear often at Total World Energy is ‘you don’t realise how much renewable energy could contribute to the global energy mix’. And while that is probably true, it still gets to me because more and more money is spent every year in the development of technologies and techniques to further advance renewable sources but the actual installation of sources that can genuinely produce power from viable renewable sources doesn’t seem to expand at the same rate.

Here in the UK, most people recognise the importance of a thriving renewable sector to both the economy and the energy mix.

Janine Freeman, head of UK and EU public affairs at National Grid told the Guardian newspaper: “We have to try and find a way to make this tangible and real to people. We do need some more clarity around decisions being made about the trade-offs.”

Matthew Knight, director of strategy at Siemens UK Energy said: “The UK is better off to the tune of 1.5% of GDP if it follows the decarbonisation path rather than doing nothing. It’s just a myth that this is all hopelessly expensive.”

Huub de Rooijen, head of offshore wind at the Crown Estate added: “I think it’s a hugely important player because it’s a very capital intensive sector,” so clearly the intention is there but is this an area that needs yet more money?

One thing that is for sure is that the price of energy needs to start falling; it’s unacceptable that in 2014 millions of people around the world can’t afford or don’t have access to grid electricity and even people in developed societies struggle to cope with ever-rising energy costs. But how can we stop the ascent of prices? One answer is to become more efficient, throughout the supply chain, and that is something that this month’s featured companies are all trying to do.

Shelf Drilling, Boskalis Singapore, Atlantis Resources, Siemens Energy Russia and Polat Enerji all tell us how efficiency and quality service helps the energy industry to move forward.

Tell us stories about your energy prices online @TWEmagazine

Joe Forshaw editor@ecp-ltd.com

EDITOR Joe Forshaw SUB-EDITOR Harriet Pattison WRITERS Rosie DeWinter Colin Chinery Tim Hands Roland Douglas Christian Jordan Helen Lake STUDIO DIRECTOR Martyn Oakley

RESEARCH DIRECTOR Chris Bolderstone PROJECT MANAGERS Rick Liddiment Ben Richell Kieran Shukri Jodie Rettie SALES DIRECTOR Andy Williams SALES MANAGER Daniel Marshall SALES EXECUTIVE Mark Leonard

ACCOUNTS Mike Molloy Jane Reeder MANAGING DIRECTOR David Hodgson OPERATIONS DIRECTOR Chris Bolderstone FINANCE DIRECTOR Scott Warman

2a Ardney Rise, Norwich, Norfolk, NR3 3QH, United Kingdom If you would like more information about ways in which Total World Energy can promote your business please call +44 1603 411568 or email | editor@ecp-ltd.com East Coast Promotions Ltd does not accept responsibility for omissions or errors. The points of view expressed in articles by attributing writers and/ or in advertisements included in this magazine do not necessarily represent those of the publisher. Any resemblance to real persons, living or dead is purely coincidental. Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without the prior written consent of the publisher. © East Coast Promotions Ltd 2014

PAGE 3

Contents EDITOR’S PAGE

3

NEWS

6

Will investment result in price reductions?

All that’s happening in the energy industry

EnTREPRENEUR

14

Innovation

16

Atlantis Resources

20

Shelf Drilling

26

Teekay Petrojarl

34

Boskalis Singapore

40

COSCO Shipyards

48

Labuan Shipyard

54

John Thompson

58

Reef Subsea

62

SOCAR

66

Siemens Russia

70

OWS

74

INPP

78

Net4Gas

82

Polat Enerji

86

Wind Energy Hamburg

90

Gadget Box

94

Future Power

96

Making it work, for herself

Nothing but photovoltaic power

Developing Scotland’s MeyGen project

Thai drilling for Shelf

The Petrojarl Knarr is ready and raring

Growing with the great island state

Is China now the region of choice for offshore services?

Engineering excellence from Malaysia

60 years of boiler manufacture in South Africa

On top of the bottom line

Building European connections

It’s all about efficiency in Russia

Driving offshore wind development

Darius Janulevičius talks decommisioning

Andreas Rau tells us more about the Gazelle project

Zeki Eriş talks Turkish renewables

Your gateway to the world of wind energy

For the fashion conscious energy professional

Japanese innovation

PAGE 4 MAR 14

CONTENTS

26

70

26

34

96

62 PAGE 5

# twenews Rosneft discovers a new hydrocarbon field in the Kara Sea Rosneft successfully completed the drilling of the northernmost well in the world – the Universitetskaya-1 well in the Arctic. According to the results of the drilling Rosneft has made an oil discovery at the East-Prinovozemelskiy-1 license area. The drilling was completed in record-breaking time – just six weeks – in compliance with all the technological and ecological standards and requirements.

The sea depth at the drilling site is 81 m, the depth of the straight well – 2,113 m. the well was drilled in open-water conditions – at the 74th circle of longitude, 250 km clear off the inland of the Russian Federation.

As a result of the drilling formation samples were obtained, a pilot borehole was drilled (diameter 8.5 inches to a depth of 600 m) and horizontal drill samples were collected. Specialists obtained substantial amounts of new geological data which will be elaborated. Upon the completion of the analysis a conclusion on the resource base of the discovered field can be made. At the moment, the geological data interpretation is being conducted and the field’s development model is being elaborated. The security and failsafety of the operations of future drilling is guaranteed by the landing of five columns.

During the ceremony dedicated to the completion of the drilling the head of Rosneft, Igor Sechin said: “I

PAGE 6

can inform you about the discovery of the first oil/gas-condensate field in the new Kara sea oil province.

The first oil was extracted. It is an astonishing sample of light oil, which based on the results of the analysis performed, is comparable to the Siberian Light oil. The resource base estimate of just this oil trap is 338 bcm of gas and more than 100 mln tonnes of oil. And this is just the estimates of this very structure. This is an outstanding result of the first exploratory drilling on a completely new offshore field.

This is our united victory, it was achieved thanks to our friends and partners from ExxonMobil, Nord Atlantic Drilling, Schlumberger, Halliburton, Weatherford, Baker, Trendsetter, FMC. We would like to name this field Pobeda” A wide range of detailed research of the environment preceded geological operations: climate, iceberg migration, wildlife thorough analyses were conducted. Rosneft for many years has conducted such research in the Kara Sea, Laptev and Chukchee Sea. All of this data is taken into consideration while planning the exploration and for the design of rigs and for the evaluation of logistics for shelf projects.

Rosneft has organised 10 scientific expeditions in the Arctic. As a result of this work the meteorological observation system in the Kara Sea was fully restored.

Special focus of this research is on biological analysis, which includes,

the monitoring of the habitat of marine mammals and birds.

The Universitetskaya structure covers an area of 1,200 thousand kilometres with a 550 m high hydrocarbon trap. Its resources account to more than 1.3 billion tons of oil equivalent. A total of some 30 structures were found in three East Prinovozemelskiy areas of the Kara Sea, and the entire resource base of the three areas is estimated at 87 billion barrels or 13 billion tonnes of oil equivalent.

According to experts the volume of the Kara Sea oil province resources exceeds the oil and gas resources the Gulf of Mexico, the Brazilian shelf, the shelf of Alaska and Canada, and it will be comparable to the resource base of Saudi Arabia.

Prior to the start of operations in the Kara Sea, the West Alpha drilling rig was heavily upgraded, which among other things was needed to guarantee ecological safety. The rig is equipped with two groups of blowout preventers and an independent submarine locking device, which in case of minor risks will seal the well. The rig is held at the drilling site by an anchoring positioning system, consisting of eight anchors. This guarantees elevated rig stability. Most of the platform is out of the reach of the waves, which can disturb its operations. The rig is capable of drilling to a depth of up to seven km.

NEWS

Vattenfall orders nine Siemens direct drive wind turbines for Juktan onshore project Siemens Energy has been awarded an order for Vattenfall’s Juktan onshore wind power plant. Siemens is to supply nine direct-drive wind turbines of the type SWT-3.2113 with a power rating of 3.2 megawatts each and optimised for the climate in the north of Sweden as the rotor blades are equipped with active de-icing equipment. The contract includes also a service and maintenance agreement for a period of five years. The project is located in Sorsele municipality in northern

Sweden. Installation is scheduled for autumn 2015.

After commissioning in late 2015 Juktan onshore wind power plant will have an installed capacity of 28.8 megawatts. The annual production of 82 gigawatt hours (GWh) is equivalent to electricity consumption of approximately 27,500 Swedish private households.

Juktan is the first project in Sweden which is being equipped with the uprated Siemens D3 wind turbines.

Compared to conventional, geared

units, these turbines have half as many parts and considerably less moving components. This enhances efficiency and reduces operating costs. The wind turbines will be mounted on towers with a hub heights of 93.5 meters.

Wind power and energy service are part of Siemens’ Environmental Portfolio. Around 43 percent of its total revenue stems from green products and solutions. That makes Siemens one of the world’s leading providers of eco-friendly technology.

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# twenews

Goran Bogicevic - Shutterstock.com

Eni strikes oil in Angola Italian oil company Eni made a new oil discovery in Block 15/06, in the Ochigufu exploration prospect, in deep water offshore Angola.

Ochigufu is the 10th commercial oil discovery made in Block 15/06.

The new discovery is estimated to contain 300 million barrels of oil in place.

Ochigufu 1 NFW well, which has led to the discovery, will be brought into production in record time. The well is located at approximately 150 kilometers off the coast and 9.8 kilometers from the Ngoma FPSO (West Hub) and the closeness to Ngoma FPSO allows the increase of the resource base of the West Hub project, currently underway. The well was drilled by the Ocean Rig Poseidon drillship in a water depth of 1,337 meters and reached a total depth of 4,470 meters.

Ochigufu 1 NFW was directionally drilled in order to reach the targets

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in optimal position and proved a net oil pay of 47 meters, (34° API) contained in the Lower Miocene and Oligocene sandstones with very good petrophysical properties.

The data acquired in Ochigufu 1 well indicate a production capacity equal to more than 5,000 barrels of oil per day.

Claudio Descalzi, Eni’s CEO said: “This important discovery, which will be brought into production in record time, adds even more value to Block 15/06. Like the recent discoveries in Congo and Gabon, this new find exemplifies the results we can achieve by applying leading edge technologies to exploration, and substantiates the decision to refocus Eni on key oil and gas competences.”

Studies are underway in order to evaluate an early tie-in to the Ngoma FPSO, already in location in the West Hub and designed to handle 100,000 barrels of oil

production per day.

Eni is operator of the Block 15/06 with a 35% stake. The other partners of the Joint Venture committed to the block are Sonangol P&P (30% stake), SSI Fifteen Limited (25% stake), Falcon Oil Holding Angola SA (5% stake) and Statoil Angola Block 15/06 (5% stake).

Eni describes Angola as a key country in the strategy of organic growth of Eni, which has been present in the Country since 1980 with a daily production in 2013 of about 90,000 barrels of oil equivalent per day. In Block 15/06 the two oil development projects West hub and East Hub have already been sanctioned. The production start-up of the West Hub project, through FPSO Ngoma, is expected by the end of 2014.

In Angola, Eni is also operator of Block 35, located in the deepwater Kwanza Basin.

NEWS

Petronas targets Latin America expansion Petronas has announced the signing of agreements with the national oil company of Mexico, Petróleos Mexicanos (Pemex) and with the national oil company of Argentina, YPF, extending its aspirations for growth in the Americas.

Petronas President and Group CEO, Tan Sri Dato’ Shamsul Azhar Abbas on 25 September 2014 inked a Memorandum of Understanding (MoU) and Cooperation with the Director General of Petróleos Mexicanos (Pemex), Emilio Lozoya Austin purposed at furthering business opportunities and mutual cooperation between the two national oil companies.

With this, PETRONAS and Pemex

will explore appropriate mechanisms through which there will be an exchange of experience, knowledge and best practices for activities related to deepwater projects, mature fields, heavy and extra heavy crudes, as well as the possibility to develop projects related to natural gas and infrastructure.

The agreement additionally addresses the development of human capital. Both national oil companies are also committed to achieving sustainable hydrocarbon development as well as environmental protection in their activities.

Petronas and Pemex also signed a tripartite Memorandum of Understanding and Cooperation

with YPF, the Argentinian national oil company, which was represented

by Miguel Galuccio, Chief Executive Officer. The MoU covers the sharing of experiences and best practices related to exploration and production of oil and gas.

“Petronas has always believed in the importance of having the right partners for growth, and Pemex provides a natural choice being the Mexican national oil company. Meanwhile, the Tripartite MOU is an extension of our collaboration with YPF in Argentina.

“These MOUs will hopefully provide a strategic platform for growth to complement and provide optionality to our North American resource base,” said Tan Sri Shamsul.

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# twenews Gas discovery in Pingvin Operator Statoil has together with PL713 partners made a gas discovery in the Pingvin prospect in the Barents Sea. The discovery is a play opener in a frontier unexplored area of the Barents Sea northwest of Johan Castberg.

The discovery well 7319/12-1, drilled by the drilling rig Transocean Spitsbergen, proved a 15-metre gas column in the well path. Statoil estimates the volumes in Pingvin to be in the range of 30-120 million barrels of recoverable oil equivalent.

The discovery is currently assessed as non-commercial.

“Pingvin is the first well drilled in PL713 – a large frontier area northwest of Johan Castberg

awarded in the 22nd concession round. For a discovery in this area to be commercially viable it needs to be an oil accumulation of a significant size. A gas discovery does not have commercial value at present.

“On the positive side, it is encouraging that the first well drilled in this unexplored area has proven hydrocarbons in sandstones. This indicates that we have both a reservoir and a working hydrocarbon system in the area, and creates a good basis for further subsurface work in the licence,” says Dan Tuppen, vice president exploration Barents Sea and Norwegian Sea.

Pingvin is a good example of efficient exploration performance.

“The partnership drilled Pingvin just 15 months after the acreage award. The chosen well location allowed us to clarify the hydrocarbon volume in the structure with one very efficiently executed exploration well,” says Tuppen.

Exploration well 7319/12-1 is located in PL713 about 65 kilometres northwest of the Johan Castberg discovery. Statoil is operator with an interest of 40%.

The partners are RN Nordic Oil AS (20%), North Energy ASA (20%) and Edison International Norway Branch (20%).

Photo credit Øyvind Hagen

PAGE 10

NEWS

Alstom Presents 1.4MW Tidal Turbine

Alstom has improved the design of its 1 MW tidal stream turbine and now offers the Oceade™ 18 – 1.4 MW: a turbine even more efficient, cost-effective and easy to maintain.

With a rotor diameter of 18 metres, the Oceade tidal stream turbine has a nominal power of 1.4MW and three variable pitching blades. It is equipped with plugand-play modules on rails, easily accessible through an inspection hatch at the rear of the nacelle to enable faster assembly and maintenance.

retrieve the turbine. The unit rotates to face the incoming tide at an optimal angle and thus extract the maximum energy potential.

The Oceade is ready to be deployed at the tidal energy farm that will be selected in the call for expressions of interest launched in September 2013 by the French government.

Alstom is currently working on the development of an Oceade™ platform concept to reduce the price of electricity and maximise the use of tidal stream resources

Orkney Islands in Scotland. Alstom is currently testing the turbine, which has already reached nominal power of 1MW, demonstrated its autonomous running capability and generated over 500MWh on the Scottish grid, as part of the ReDapt Project (Reliable Data Acquisition Platform for Tidal), which is commissioned and co funded by the ETI (Energy Technologies Institute).

“With this new tidal energy production solution, Alstom has made definite headway. The project

This turbine is buoyant, making it easy to tow to and from the operating site. Installation and maintenance costs are therefore lower because there is no need for specialist vessels and divers. It also reduces the timeframe to install or

according to local conditions (tidal current speed and depth) .

In January 2013, Alstom successfully deployed a 1MW tidal stream turbine at the European Marine Energy Centre (EMEC), a test site located off the coast of the

is seeking to demonstrate a new design for an efficient, reliable turbine to reduce installation and maintenance costs with a view to commercial production,” declared Jacques Jamart, Alstom Senior Vice-President New Energies.

PAGE 11

Energy from science Editorial: Christian Jordan

Danielle Fong is the Cofounder and Chief Scientist of LightSail Energy, a California based company developing breakthrough, high efficiency energy storage systems using compressed air. Her impressive career could act as an example to leaders in the energy business and inspire more young ladies into the industry in the future.

Sometimes in the energy industry, it’s easy to forget that we are actually in 2014. Of course, if you look at all of the technology and money involved then you will be reminded of the times but if you look at the workforce, you might be shocked to find out that there are still not too many ladies in top positions.

So why is this? In this day and age, are we still shackled by ideas of the past that females shouldn’t or couldn’t sit atop the pile in the energy industry?

Or is it just a legacy if the past that fewer ladies are attracted to work in the industry? One thing is for sure, like all other industries in the world, the mix of male and female in top power positions is sure to change over the next few decades.

Organisations like the Women’s Energy Network, the Association of Women in Energy and the Hawthorn Club all try and encourage female prosperity in leadership roles in the industry but recently the Guardian

PAGE 12

newspaper said that the lack of women at the top is damaging the UK’s energy sector.

“The global energy and utilities sector has been underperforming for the past five years because of a surprising factor, according to a recent report by EY (Ernst & Young).

The lack of gender diversity in senior leadership teams is holding back innovation. No wonder, as the numbers are shocking: just 4% of executive board members at the top 100 utilities companies are women,” reports the paper.

But in amongst that 4%, there are some real gems.

One of them is 26 year old (born 30.10.1987) Danielle Fong - Cofounder and Chief Scientist of LightSail Energy.

Danielle is a remarkable entrepreneur with a fantastic story and her innovations have been called ‘world changing’ by many industry onlookers.

Her story starts in Nova Scotia, Canada where she grew up as an

inquisitive youngster.

Danielle dropped out of junior high school at the age of 12 to attend Dalhousie University. She graduated from Dalhousie in 2005 at age 17 with first class honours in computer science and physics, after which she entered the Plasma Physics Department at Princeton University as a Ph.D. student, but later dropped out.

From then on her entrepreneurial spirit began to shine through albeit fairly unsuccessfully. She says: “In September 2007, I realised I’d make a terrible employee.

“Later that month, I realised that I’d starve if I didn’t take matters into my own hands and start my own thing; then I realised that I might have a halfway decent chance at making a difference,” she says.

“Until May 2008 I struggled to launch any of dozens of start-up ideas, while working side jobs and supporting cofounders/friends. In June

Entrepreneur

2008, I started working feverishly on compressed air technology and for the next four months I was couch surfing.”

Eventually, in August 2008, Danielle cofounded LightSail Energy with Stephen Crane and Edwin P. Berlin, Jr and the company began specialising in the development of a form of compressed air energy storage, which they term regenerative air energy storage (RAES). LightSail changed focus from a vehicle based technology to a grid scale energy storage technology in the course of development.

Danielle’s scientific mind was instrumental in the development of the company, which has won many accolades in recent years.

“We aim to produce the world’s cleanest and most economical energy storage systems. Compressing air creates heat energy. Until now, this was wasted, drastically reducing efficiency,” the company says. “Our innovation: an elegant method of

capturing this heat energy and regenerating useful energy from it. We inject a fine, dense mist of water spray which rapidly absorbs the heat energy of compression and provides it during expansion.”

It all sounds very technical, but Danielle says: “It could radically reorient the economics of renewable energy.”

Originally based in an old fire station in Oakland, LightSail moved to an old chocolate factory in Berkeley, California.

And since the formation of her company, Danielle has been featured in Forbes’ 30 under 30 in the Energy category and interviewed by Forbes in a video titled “Danielle Fong May Save the World”. She was named by the MIT Technology Review as one of the top 35 innovators under 35 in 2012. She is a regular guest contributor to the Women 2.0 blog and was a featured speaker at the Women 2.0 PITCH Conference and Competition 2012.

The company itself had attracted

much attention and importantly, much investment from prominent industry and global players. Investor include French energy giant Total, global software magnate Bill Gates, leading global financing provider Triple Point Capital, German American entrepreneur, venture capitalist Peter Thiel, San Francisco based venture capital firm Founders Fund, investor in early stage Nova Scotia entrepreneurs Innovacorp and a number of other private investors but one of the main contributors from the very beginning was Khosla Ventures led by Vinod Khosla. You don’t attract names like this without a serious amount of entrepreneurial clout.

In her relatively short amount of time on this earth Daniele Fong has already made a significant impact and it looks certain that there will be more to come from her brilliant mind. And oh yes, she’s female, proving that you can be a lady and contribute to the energy industry from a senior position

PAGE 13

Solar power on the world’s water?

Editorial: Rosie DeWinter

Currently docked in Venice, the MS Tûranor PlanetSolar is one of the world’s most interesting vehicles. Powered by nothing but solar energy, this boat has done what most cannot do with traditional technology, sail all over the world, navigating some of the most difficult waterways using nothing but energy from the sun.

In August, Total World Energy reviewed the revolutionary solar powered airplane, Solar Impulse.

This is a piece of engineering brilliance using solar panels and advanced energy storage techniques to allow the plane to fly for huge distances, even without the sun.

And the use of solar power in ‘everyday activities’ is increasing; it’s not just in huge commercial solar parks where the true power of the sun is being realised. Take The Lightie (featured in Total World Energy June 2014) for example; an everyday problem being solved through the use of

PAGE 14

solar power.

And this month we take a look at another transport related problem that is being addressed by the sun and that problem is on the seas, rivers, lakes and oceans of the world. How do you go about sailing across large waters without polluting and using dirty fuels? You can’t use batteries; they’re too unreliable, you can’t rely on wind; you never know where you’ll end up, but one thing that is certain is that at some point on your journey, the sun will shine and being on open water, it’s unlikely that you’ll be covered by shadow.

So the PlanetSolar team decided to try and demonstrate that solar sailing is viable by undertaking a world-tour and sailing around the entire planet using nothing but solar energy.

The point of this ambitious plan was to prove that today, we have the resources, the knowledge and technologies required to reduce our dependence on fossil energy.

The story began ten years ago, back in 2004 when Swiss eco-adventurer, Raphaël Domjan, had the idea to sail around the world on a boat powered only by solar energy. His dream became a reality in 2008 after he

Innovation

met Immo Stroeher, a German entrepreneur, and advocate of solar technologies who had solid experience in the field. Together, the two men combined ideas and funds to make this idea a reality. Construction of the boat began at the end of 2008 in Kiel, Germany. It took almost 18 months before MS T没ranor PlanetSolar, the largest solar boat ever constructed, was ready to

put to sea.

The first world tour started on September 27th 2010. The solar vessel left the port of Monaco, heading west towards the Atlantic, the Panama Canal, the Pacific, the Indian Ocean, the Gulf of Aden, the Suez Canal, stopping at 52 ports along the way before finally returning to the Mediterranean Sea and Monaco on May 4th 2012.

During this remarkable journey, the

crew and the vessel met members of the media, the public and other sailors to promote the idea and solar energy in general.

The first world tour was widely regarded as a success and a great feat of engineering. The boat was powered only by photovoltaic technologies demonstrating that the industry had matured and become efficient.

The next challenge for the boat

PAGE 15

was a tour of the Mediterranean.

During the summer of 2012, the vessel moved around Europe, further validating the efficiency of energy from the sun. With stops in large cities such as Marseille (France), Barcelona (Spain), Calvià (Spain), Cagliari (Italy), and La Valette (Malta), the message of solar energy was delivered to the public and local governments.

There was one difference during this campaign, the captain.

Raphaël Domjan decided to leave the adventure to focus completely on his foundation’s activities which meant that a brand new crew, led by Eric Dumont, would now oversee the day-to-day operations on-board.

In 2013, the boat received a new lease of life and was adapted and upgraded to now act as a scientific research vessel. After six months of maintenance and optimisation works, specifically

PAGE 16

with her propulsion system, the MS Tûranor PlanetSolar began 2013 by once again crossing the Atlantic, this time in a Guinness World Record time of just 22 days (beating the previous record of 26 days).

After arriving in the Caribbean, the vessel moved on to Florida where it started the first of its scientific missions: PlanetSolar DeepWater. This mission, led by professor and climatologist Martin Beniston from the University of Geneva (UNIGE), fuelled the ambition to analyse processes with the ocean-atmosphere interface of the Gulf Stream involved in climate control.

Because the ship does not pollute and contaminate data collected, the scientific team collected a series of new physical and biological measurements from the sea and air.

While tracking the Gulf Stream,

the boat travelled from Florida to Canada with stops in Miami, New York, Boston (US), Halifax, St John’s (Canada), returning to Europe stopping at Oostende (Belgium), London (UK), Paris (France), and Lorient (France), where she spent the winter.

By all accounts, the 2013 campaign was a resounding success. After more than 20,000 kilometres sailed, of which more than 8,000 were focused on science, the catamaran achieved its objective of demonstrating that she could go beyond her role as mobile ambassador for photovoltaic energy.

Today, the boat has travelled over 60,000km (37,000 miles), it has won numerous awards, it’s been featured in just about every news outlet in every country and, most importantly, it has showed just how far solar power has come

Innovation

MS Tûranor PlanetSolar: The facts • • • • • • • • • • •

Current Captain: Gérard d’Aboville Sundeck is made up of 512m² of solar panels 29,124 solar cells with an output of 22.6% supplying 8.5 tons of lithium ion batteries Two propellers with five tapered blades (81cm in diameter) rotating at a maximum speed of 600 rpm Powered by one electric motor with 60kW per hull (maximum output 120kW) Maximum speed is 14 knots (26km/h) Average speed is five knots The vessel can hold 60 people on-board when docked There are six cabins and nine beds 64,000 hours of construction work to build 89,000kg total unladen weight, including 20,600kg carbon fibre, 23,000kg of epoxy resin, 10,000kg of equipment and supplies on-board when configured for navigation, including 2000 litres of fresh water • Total length = 35 metres • Total width = 23 metres • Total height = 6.3 metres + 1.5 metres draft

• 0 litres of gasoline used • 0 CO2 emissions

PAGE 17

Atlantis’ tidal power is no myth

Editorial: Harriet Pattison

Tidal stream power is considered a much more environmentally friendly and predictable renewable energy source causing minimal visual impact. Chief Executive of Atlantis Resources, one of the world leaders in the tidal energy industry, Tim Cornelius tells Total World Energy about the exciting development underway in the Pentland Firth in Scotland which is hoping to provide enough electricity to power 175,000 homes…

Tidal current power is not always the first source of sustainable energy that one may consider when thinking of modern day renewable resources but in fact it benefits from being a clean, renewable and far more predictable alternative.

Singapore based Atlantis Resources is an industry leader in the tidal power sector, growing significantly since its inception over a decade ago.

Chief Executive, Tim Cornelius

PAGE 18

tells Total World Energy about the company’s significant growth and development within this growing sector of renewable energy: “Atlantis has a ten year history of developing tidal power technology and of tidal power projects. The genesis of the company was that it was a small publicly unlisted company in Australia.

“It was looking at early rudimentary systems for extracting the energy from the flow of the

tide. When I became involved in the business we essentially acquired the intellectual property from that company and moved over to Singapore which is where we incorporated Atlantis Resources, which at the time was Atlantis Resources Corporation.

“That was really the genesis of the modern company that you see before you today,” explains Cornelius. “At that point in time we started to expand out of Singapore,

Atlantis Resources Singapore is still the headquarters for the listed company, Atlantis Resources Limited. So the original genesis was Australia but very quickly moved to Singapore,” he says.

Cornelius, who trained as a marine biologist, started his career as a commercial diver who also worked on manned submarines and unmanned ROVs. “I worked for a long time in the offshore oil and gas field construction industry.

I worked all over the world for about a decade on specialist construction vessels, oil rigs and semi-submersible platforms. I made the transition from working

offshore to working onshore and during that period I became very interested in the emissions market.

I spent time studying carbon and the emissions market with a focus on NOx (nitrogen oxides) and SOx (sulphur oxides) and other environmental derivatives that are traded to effectively limit the economic impact of weather on large construction projects.

“During that phase, I was approached by what was then the board of Atlantis Energy Limited. I understand offshore construction and engineering and about the financial markets so they asked if I was interested to come and run the

company.”

The decision to move Atlantis to Singapore in 2005, Cornelius explains, was based on a number of reasons, including the research and development opportunities: “The first reason was access to Asian markets, which naturally made sense. Second of all, access to high quality and relatively low cost engineering resource and thirdly, Singapore is a very good jurisdiction for the development of intellectual property and the prosecution of infringement. We saw in the early stages, as with all technology companies, that intellectual property was going to

PAGE 19

a very big part of us going forward and therefore it made a lot of sense to move to Singapore.”

The research and development of tidal power has seen an increase in recent years due to new technological developments and improvements. Advancements in design including the dynamic tidal power and tidal lagoons and new developments in turbine technologies, improving axial turbines and cross flow turbines, have helped to develop the availability and viability of implementing tidal power projects in locations around the world.

With oceans covering up to 70% of the earth’s surface, tidal streams have the potential to provide an unlimited source of energy and offer many benefits to other renewable energy sectors. With tidal turbines PAGE 20

located beneath sea level the natural environment doesn’t undergo significant alterations, there is less visual impact and fewer fluctuations are present as tidal turbines remain almost independent of changing weather conditions.

Because water is much denser than air, the tidal turbines only need small rotors compared to the impressive rotor span of wind turbines. Smaller tidal rotors also mean less seabed per square meter is required because they can be placed much closer together.

GROWING SUPPORT FOR TIDAL POWER Renewable energy has seen an increase in support in recent years with the Scottish government in particular showing strong support

for variable renewable energy development through both policy and legislation. It is estimated that 71 countries now having a feed-in policy in place to support renewable energies.

The Climate Change (Scotland) Act 2009 imposes a legal commitment on the Scottish government to reduce emissions by 42% from 1990 by 2020 and by 80% by 2050, a target which can only be achieved through substantial exploitation of Scotland’s considerable sustainable resources.

“The UK now has an obvious ability for us to be able to expand our portfolio of project development and there are other sites in Scotland that we’re looking at right now,” explains Cornelius. “There are also sites in England and Wales,

Atlantis Resources so the UK is obviously very exciting for us because we understand it well and understand the regulatory regime.”

GLOBAL PROJECTS With support for tidal power growing, research into appropriate grid access and economically viable locations is vital for companies like Atlantis. Cornelius explains the preliminary checks that determine whether development on a site can begin: “There’s a big difference between what is determined to be economically extractable and what we consider to be just net resource.

“Ultimately, what dictates where you elect to develop a site comes down to two main things: Firstly, nature of resource, take that as a given, it obviously has to be an area of strong flow. Secondly, access

to grid. You’ll find that one of the largest rate determining steps in the world is that typically huge amounts of tidal power is located in areas where you’ll never be able to evacuate the power in a meaningful or economically way. For example, Russia has got some of the largest tidal ranges in the world but its five and a half thousand kilometres away from anywhere that you could connect to,” he says.

The potential of tidal power is enormous and although estimates of the global potential vary, it has been estimated in a study by Black & Veatch that tidal stream energy could, in theory, supply more than 150 terawatt-hours (TWh) per annum. Where one terawatt-hour per year equates to 114 MW, this is well in excess of all domestic electricity consumption in the UK

and therefore represents a potential total global market size of up to 90GW of generating capacity.

As 25% of Europe’s tidal energy potential resources come from Scotland, The Pentland Firth is now widely considered to be one of, if not the world’s best site for tidal power. Because the water flow is rapid, the tide shifting from the Atlantic into the North Sea is forced through a narrow eight-mile channel, making it a perfect site for development. In a recent study by Oxford University, it’s estimated that this site alone has the potential to provide half of Scotland’s electricity.

Cornelius explains that looking outside the UK, France has strong potential for tidal power. It has interesting technology for deep water projects, great resources and the government is pro-tidal. “It’s

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going to be a good market going forward,” Cornelius says.

“It will be one of the next markets to come on and we are consistently looking for opportunities to enter into development arrangements in France because France is the other highly developing country for perspective for tidal power,” explains Cornelius.

Next on the company’s radar is Canada in the Bay of Fundy between New Brunswick and Nova Scotia, which is the most promising location in Canada for tidal energy and has the potential to produce as much as 30,000 MW of energy.

“We’re currently exploring an opportunity to develop there with

Tim Cornelius © Shell PAGE 22

our project partners, Lockheed Martin,” Cornelius explains.

THE MEYGEN PROJECT It is the MeyGen Project however, which is placing Atlantis on such a pedestal within the tidal energy industry. Located in the far north of Scotland, in the Pentland Firth, MeyGen is Atlantis’ flagship project.

“The unusual thing about Scotland,” explains Cornelius, “is that it’s got very good resource, the resource is very close to shore and we were able to get good connection to national grid to be able to dispatch the power down south. So from that perspective, it

had all of the attributes to make it an ideal place to develop.”

MeyGen Limited, now 86% owned by Atlantis, is the company behind the project. Powered solely by the tide, the project will generate enough electricity to power up to 175,000 Scottish homes and is hoping to deliver a fully operational renewable energy plant of an estimated 398 MW. With a total of £51.3 million having been secured from syndicate members comprising the UK government, through the Department of Energy and Climate Change (DECC), Scottish Enterprise, Highlands and Islands Enterprise (HIE), The Crown Estate

Atlantis Resources (TCE) and Atlantis, Cornelius explains why this project is so important, not only to Atlantis but the tidal industry: “It’s the first to go through its consents, it’s the largest project in the world and it’s the first project ever to receive a project financing package. So it’s now the flagship not only for Atlantis but for the entire global tidal industry so effectively it’s setting the bench mark now for how long it takes to develop a project, how one seeks to design it, build it and more importantly finance it.”

With the first phase of the project scheduled for installation during 2015, Cornelius reveals what can be seen at the Scottish site now: “The first thing that you’ll see is bulldozers on site building the big substation for the project. The substation is obviously onshore and then we drill all the cables, so throughout the remainder of this year into next year all of the onshore works are occurring, all the civil works and the cables will get drilled out so all of the horizontally directional drilled cables will be out to the site.

“Each of our turbine manufacturers will commence fabricating turbines and they will get delivered on site middle to the end of next year. They’ll go through their commissioning onshore and we’ll look to get them out into the water at the end of next year, beginning of 2016 depending on progress. So quite a rapid development cycle, with respect to going from a green field site to turbines generating and putting into the grid,” he explains.

COMMUNITY SUPPORT Cornelius explains that Atlantis continues to have a strong support network from the Scottish

community that will benefit from the MeyGen project.

“It should go very smoothly, the reality is this has been a five year planning and consenting process.

We’ve done a huge amount of stakeholder engagement, we’ve got a very strong local support base in the community and it should be an economically stimulating development at the same time in a very environmentally benign way and I think everyone appreciates that.

“We don’t have the same opposition that sometimes occurs with onshore wind. With a tidal turbine you don’t see it and you don’t hear it and because they are being installed in a location of high flow, fishermen aren’t interested. So we would expect to think that from a permitting, consenting and environmental perspective, things should go well.

“We’ve engaged with some of the biggest and best equipment suppliers in the world, with the likes of Andritz, ABB and Lockheed Martin and we’re very confident of their capability to deliver,” explains Cornelius.

‘ONE OF THE WORLD LEADERS’ “I think we’re definitely one of the world leaders; I think the fact that we’ve been able to get MeyGen through consenting shows that we lead. I understand we need to verify this but I understand it’s the first offshore project, including offshore wind, to have received its full consents for construction from the Energy Minister in Scotland and to sign a formal 25 year lease with The Crown Estate in Scottish waters.

We are obviously delighted to have high quality providers of

technology in our sector with the likes of Siemens, Alstom and Voith. These are all high quality companies, we hope they will become equipment suppliers to Atlantis going forward. I wouldn’t say we’re the best because I think that’s dangerous, but I think we are one of.”

Looking to the future it seems set to be a busy and exciting one for Atlantis seeing such impressive growth and potential in the decade since it started.

“Atlantis has evolved as the company,” explains Cornelius. “A decade ago we were a technology company that did a little bit of project development because we had to to create a market into which to sell our turbines. These days we are essentially a project development and financing company in the marine energy sector which also does a little bit of technology because we have to.”

With construction on the MeyGen site commencing later this year, Cornelius explains what’s next for Atlantis, with potential to venture into the wind energy sector: “Our core skill base is definitely offshore marine power projects and to that extent, we would never rule out looking at opportunities to develop offshore wind.

“There are a lot of natural synegies in the way you evacuate power so what I would expect our next step to be would be to look at opportunities to combine the development of offshore wind along with the development of tidal power in similar geographic locations and start to look at sharing common power evacuation systems to drive economies of scale,” Cornelius concludes

PAGE 23

Thai drilling for Shelf Editorial: Christian Jordan

Shelf Drilling is currently constructing two new jack-up rigs which will be used for projects in the Gulf of Thailand by Chevron Thailand, a subsidiary of Chevron Corporation.

Shelf Drilling CEO, David Mullen tells Total World Energy more about these new rigs and the fantastic development of this unique business since its formation in 2012.

Earlier this year, in May, international jack-up rig contractor, Shelf Drilling, announced that it had been awarded contracts for two newbuild jack-up rigs by Chevron Thailand, continuing the company’s focus on Asia and Southeast Asia.

Both of the contracts are for a five year term and the rigs are set to begin operations off Thailand in early-mid 2017. Reports suggest that revenues generated for each PAGE 24

contract could be around $281 million (excluding revenues for mobilisation, demobilisation and miscellaneous adjustments).

Total World Energy asks Shelf Drilling CEO, David Mullen about the newbuild rigs being developed for these contracts and why the company was selected by Chevron Thailand.

“Chevron Thailand see that as a focussed company, we can be a

lot more flexible in our operation and drive performance. They saw a company looking at only jackups, with a lot of experience at the management, shore base and rig crew levels, and they didn’t see us as a new company. We have rig crews that have been around for years. I can’t tell you exactly why they selected us but it wasn’t on price; it was more on our ability to execute,” he says.

Shelf Drilling “We are not that new in the industry, what we are is a company with decades of operating experience albeit through our legacy companies so when we acquired the fleet of assets from Transocean we also brought on board all the people that were working on the rigs. We carried forward the history that we had with the legacy companies and so through those legacy companies, we have actually been operating in the Gulf of Thailand for decades.”

Shelf Drilling has contracted Lamprell (featured in Total World Energy, July 2014) to build the two new rigs and they will be of the popular MLT Super 116 E design.

Conveniently, Lamprell’s Hamriyah shipyard in Sharjah, Dubai is just 50km from the Shelf Drilling headquarters in Jumeirah Lakes Towers.

“We were awarded the contract five months ago” Mullen says, “and we’ve continued to do a lot of engineering work; these rigs are a

strong collaboration effort between ourselves, Chevron and Lamprell and we believe that these rigs will be quite unique. They are going to be kitted out with a lot of offline capability which will allow them to drill wells in a very short period of time. In Thailand today, we are able to drill complete wells in around six days with Chevron and we believe our new rigs will save approximately 20% of that time.

“The important thing is that they are really fit for purpose for that operating environment and they are fit for purpose for the Chevron well profile. They’ve been designed with a lot of input from our engineers, Chevron engineers, and of course Lamprell. We cut steel on the first rig this month and we will cut steel on the second rig six months from now. All the detailed engineering has been completed, all the design criteria is complete and now all that remains is for us to construct the rigs.”

With one of the strongest fleets

in the industry, Shelf Drilling’s group of assets is big. Currently consisting of 37 jack-up rigs, one swamp barge and the two newbuild jack-ups currently under construction, Mullen says that each asset has its own strength and is well suited to a certain type of operating environment.

“We see all of our rigs as our flagship. We have a diverse fleet; we have rigs that are fairly low specification but are ideally suited for what they do, like the rigs in the Gulf of Suez on EGPC joint ventures. We have rigs in the Gulf of Thailand which are highly specified to be able to undertake work in a very efficient manner.

The Gulf of Thailand is by far and away the most efficient drilling environment in the world and it’s been pioneered by Unocal and now Chevron. We have rigs that fit all the different categories. What we like about our fleet is that most of it is an MLT 116C design which we recognise as the most versatile rig

PAGE 25

ever built. I wouldn’t characterise any rig as a flagship. They are all fit for purpose with what they do and that’s exactly how we want to manage our business,” he says.

There are a few fundamental rig designs to which most of the prominent shipyards stick to; the F&G MOD-VB, the Semcor design from Baker Marine, the LeTourneau design; but Mullen and Shelf Drilling are fans of the MLT 116C design. In Thailand, and around the world, this design has seen much success and the company is particularly fond of the strength of the legs on a MLT 116C designed rig.

“The MLT 116C has always had very strong legs and they are ideally suited for adverse metocean data. Over the years it’s been very versatile, operators prefer it and when you look around the world you’ll see the legacy of the MLT 116C’s footprint and if

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you’re going into a mature area of operation, you’d rather go in with a rig that has the same design as before because you have less risk of punch through, or rapid leg penetration. That’s why the design is favourable to us and a lot of others,” explains Mullen.

SHALLOW WATER Shelf Drilling’s sole focus is shallow water. This is where the company has a vast amount of experience and also the aforementioned perfectly suited fleet. When asked why shallow water receives an emphasis from his company, Mullen says it’s simply because that is where most of the offshore recoverable oil is located.

“To me it’s very obvious;” he says “shallow water is the home of the vast majority of the offshore reserves. So today, 80% of total offshore reserves reside in shallow water and actually not far from here

– the Arabian Gulf is home to a vast quantity of oil reserves. The other thing that’s pretty compelling is that typically the customer break even costs are very low unlike deepwater where the customer break even costs are very high or the US lower 48 where the conventional breakeven costs are very high.

“It’s a core element of our strategy. I called the company Shelf Drilling because I have drawn a line in the sand; we don’t have any intent to go into deepwater or harsh environments. We’re very happy to stay focussed on shallow water, we believe there is a lot of differentiation in how we operate and how we interface with our customers by being focussed.”

Shallow water operations also provide much better cost figures and less risk exposure than deepwater and with the three largest oil fields in the world situated very close to the Shelf

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Drilling headquarters, the company is perfectly situated to take advantage of the production work that must go ahead for these fields to reach their full potential.

“The top three largest offshore fields are all in the Arabian Gulf.

Safaniya is the largest with 36 billion barrels of recoverable reserves. Manifa just started in 2013 and has 13 billion barrels of oil reserves and Upper Zakum in Abu Dhabi has 21 billion barrels of oil reserves.

“When you talk about deepwater, people get excited about a billion barrel discovery and that puts it in context. If you look at everything in Brazil, it’s a lot of barrels yes; it’s probably 18-20 billion barrels but the cost of that barrel is about $5070 a barrel. The cost of a barrel in the Arabian Gulf is around $15-18 a barrel.

“We have very little risk to our operations, everything we do is above the water line; whereas if you’re in 10,000ft of water, most of what you do is hidden below the water line so we don’t have © Shell PAGE 28

exposure to a Macondo-like incident whereas in deepwater you do. I’m happy that everyone else in the industry is focussing their efforts on deepwater because it creates a lot of opportunities for us to consider,” explains Mullen.

GROWTH AND EXPANSION Like any company, expansion is one of the golden targets for Shelf Drilling. A business strategy has been formulated and by sticking closely to that strategy the company has seen significant success. You’ll find Shelf Drilling rigs worldwide in areas including Southeast Asia, India, West Africa and the Middle East, North Africa and Mediterranean.

And as for the future, the focus will obviously remain on shallow water and Mullen says that it is likely that more rigs will be ordered but, importantly, the company will not order rigs purely on speculation.

“We are in discussions with a number of oil companies and I would say it’s more likely than not.

We will not order on speculation, we like the model that we have with Chevron in Thailand, we see that as a much better model than ordering a rig on spec – we order a rig that’s ideally suited for what the operator wants – this is the way forward with newbuilds, not to just go out and order something that the yard builds.”

And because of the strong relationship the company has built up over the years with Lamprell, a relationship that has been enhanced recently during detailing of the new rigs for Chevron Thailand, Mullen says that the partnership could flourish further thanks to Lamprell’s consistency when it comes to satisfying Shelf Drilling’s strict quality, safety and efficiency criteria.

“The selection of Lamprell was based on a number of criteria; quality, flexibility, conforming to design criteria, cost, ability to deliver on time and on budget and the financing that goes with everything – those were the real pillars that we had to stick to.

Shelf Drilling Lamprell came out on top, on aggregate, in all areas. They certainly impressed us with the quality, they certainly impressed us with their track record of delivering on time and on budget, but we will continue to keep relationships with other yards. I don’t think we would necessarily go with one yard all the time; as long as they continue to deliver and compete, they’ll have an advantage because being proximal to where we are is an advantage.”

DECADES OF EXPERIENCE Mullen himself is a veteran of the offshore oil and gas industry and during the formation of Shelf Drilling in November 2012, he used all his experience to make the transition of assets from Transocean, and all the finance

arrangements that went with that deal, as smooth as possible.

“I started Shelf Drilling, it was my idea. The whole genesis of what Shelf Drilling is, is something I started. I reached out to private equity investors; one in particular, Lime Rock Partners; and asked them if they would be interested in co-investing in a rig transaction and they were very interested.

“We bought two other private equity investors in and that’s how the company started up.

We bought the fleet of assets, the people, the contracts and a transitional agreement all from Transocean and we worked through that. We’ve only been in business for two years as a standalone entity but what we really have been doing is operating these rigs for a long time in terms of day-to-day

operations,” he says.

“My own background; I spent 25 years with Schlumberger. I was the President of the oil field services division in the Western Hemisphere – North and South America. I then spent a short amount of time with Transocean, after that I went to Norway and ran a Norwegian Drilling company, Ocean Rig ASA which was bought out by Dry Ships Inc. I then went to the UK and headed up a company called Wellstream Holdings, a subsea company, principally involved in manufacturing flexible products for ultra-deepwater and deepwater applications and I ended up selling that to General Electric in 2011.

Since then I’ve been engaged in acquiring this fleet of assets and setting up the company,” explains Mullen who away from his business

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successes, also holds a B.A. in Geology and Physics from Trinity College Dublin and an M.S. degree in Geophysics from University College Galway, Ireland.

Since the establishment of Shelf Drilling, the business has shown huge positivity and Mullen outlines this with details of the backlog. “The numbers speak for themselves. We started off at inception with a backlog of $1.4 billion and today we have a backlog of $3.3 billion. Our customers would not have given us all of these © Shell PAGE 30

contracts with these long backlogs if they didn’t believe in what we’re doing. We have a backlog larger, per rig, than any other drilling contractor in the jack-up space.”

And speaking about the future of the business, the CEO says that continual improvement is a target. “We can always improve and we will always strive for continuous improvement but I think our business model - having a sole focus, being fit for purpose; focussing on national content and having an organisation that is

optimised for what we’re doing - is creating a big advantage for us.”

And as we move into times that will undoubtedly throw up many challenges for all rig contractors, Mullen is still excited and enjoying his position and that of his company.

“There’s always something to surprise you. This is by far and away the most interesting thing I’ve done. Setting up something that did not exist before is not something you often get the chance to do,” he concludes

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PAGE 31

Petrojarl Knarr: You have reached your destination Editorial: Harriet Pattison

With the FPSO Petrojarl Knarr arriving at its destination in the North Sea last month, this is one of Teekay’s largest offshore projects to date.

With plans to venture into Brazil for future developments and continued success operating FPSO’s in harsh environments, Teekay holds its core values of passion, sustainability, innovation and teamwork in high esteem resulting in a strong reputation the world over...

Established in 1973, Teekay Corporation has come a long way from a regional shipping company to become one of the world’s largest marine energy transportation, storage and production companies. In four decades, the company has diversified into new segments including FSO and LNG Carriers,

PAGE 32

it has created innovative financial structures to both raise capital and grow assets and today, it has an exponential $11 billion in assets with 170 vessels and is widely regarded as a world leader in each industry segment it is present in.

The largest operator of Shuttle Tankers and a recognised leading position in LNG Carriers, Teekay

has invested an estimated $3.5 billion in gas and offshore projects since 2011.

FPSO PETROJARL KNARR In mid-2011, Teekay entered into an agreement with BG Norge LTD to provide an FPSO unit for the Knarr oil and gas field located in the North Sea. The unit has been

Teekay Petrojarl under construction at Samsung Heavy Industries in Geoje, South Korea and began its voyage in July this year to Norway, its final destination in the North Sea. At a cost of an estimated $1 billion, the unit was officially named in February at the Samsung shipyard and to date, the FPSO Petrojarl Knarr is one of Teekay’s largest FPSO projects.

The Knarr field, previously known as the Jordbaer, is located in the Tampen area in the North Sea. It is thought to contain recoverable reserves of 70 million barrels of oil equivalents.

The Knarr FPSO, measuring 256.4m, will have a maximum design production capacity of an estimated 63,000 barrels per day.

Project Director for the Petrojarl Knarr project, Einar Saunes explains: “We started the dialogue with BG Norge during summer 2010. They were looking for alternative options, one of them being a lease and operating contract with Teekay. We took the responsibility for engineering, procurement construction and installation of a FPSO and we took responsibility for designing and delivering to the Knarr field.

“We started under an interim agreement. We signed the BG Norge contract on the lease, including the construction, on 30th June 2011. At that point in time we had signed the contract with Samsung on 9th May 2011 with the subject to the approval of the BG contract.

“We had not worked with BG Norge before as a company, we had some good cooperation with BG Norge on LNG or gas carriers prior to entering into the FPSO contract and also we have a good relationship with BG in Brazil for shuttle tankers,” explains Saunes.

The Knarr unit will commence operations under its charter contract with BG Norge for a period of either six or ten years, with the possibility of extending for a period of up to 20 years.

“If you look at the FPSO market, Teekay have the most FPSO’s in harsh environments” What is surprising perhaps is the quick turnaround of this project since it was announced in 2011. Senior VP Operations, Arne Bye explains: “If you compare us to some of the other oil and gas projects, this is not standard, it was done very quickly. It’s a very, very tight schedule.

There were

changes that we also implemented and when we implemented these changes, they were done in a very professional way. We were able to integrate these major changes in a very efficient way.

“It was built to the relevant and highest standard specs for the Norwegian sectors. Having said that, Teekay haven’t had the patent for these specifications because we own the assets, so in the bottom of all of this, it’s our philosophies, our specifications and adaptations of the standards and requirements for the Norwegian sectors and North Sea. “We take responsibility to make sure this is a top class vessel meeting our specifications and the norms and standards prevalent for the North Sea. That’s an important point, it’s not as if we build to a NORSOK or generic standard, yes its NORSOK but it’s our specifications. That influences the total quality and schedule and above all, it’s built

PAGE 33

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to be operated by us, our company,” explains Bye.

SAMSUNG HEAVY INDUSTRIES “We have a long history in the Teekay family with Samsung, both with shuttle tankers and with gas carriers,” Saunes explains. “So we have a good relationship with Samsung Heavy Industries, the sales department, the management and the yard in Geoje.”

At the Geoje Shipyard it is mostly ultra-large container ships, LNG carriers and LNG-FPSO’s which are built. At a length of 7.9km, the yard has a berthing capacity of 24 vessels.

Arne Bye explains why Samsung Heavy Industries remain in such a prominent position in the industry: “Their construction capabilities are important as being able to build

PAGE 34

“We have a long history in the Teekay family with Samsung, both on the shuttle tankers and on the gas carriers. So we have a good relationship with Samsung Heavy Industries, the sales department, the management and the yard in Geoje”

a vessel like this is actually fairly complex and both the quality and production sequences they use.

They also have an engineering capability to take a good feed, detail design it and then take it straight to construction; so you get a very tight schedule from the detail design into construction. Also the full network of subcontractors and suppliers they use.

“So they have all that to offer and also the fact we’ve had a long relationship and done development work together with them for the concept designs we have,” Bye adds.

The Geoje Shipyard boasts the greatest dock turnover rate in the world, meaning the number of ships that a dock is able to launch.

On an annual basis, the yard has a dock turnover of 10 with the

Teekay Petrojarl launch of 30 ships a year. The greater the turnover then, the more efficient the shipbuilding capacity and production is. The largest dock that is currently on site, Dock No 3, measures a staggering 640m long, 97.5m wide and 13m deep.

Samsung Heavy Industries’ high turnover rate has been achieved through a fundamental and scientific approach to construction, such as the building of large-sized ship blocks, ensuring it utilises its space by using particularly large cranes and also by shortening the main engine loading period.

This scientific approach has also been enforced in the development of remarkably intelligent robot systems. Including a spider automatic welding robot for an LNG cargo tank, a vacuumblasting robot, a wall-climbing system and an inspection and cleaning pipe robot, these innovative designs will record 68% of production Automation rate, in addition to securing perfect quality and the security of its employees’.

In addition to its high turnover rate, the Geoje Shipyard is the first to be certified by the world’s three most recognised international standards, namely the ISO 9001 (Management Quality), ISO14001

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(Environment Management) and OHSAS 18001 (Safe and Healthy Working Environment Management). Recently the Shipyard also acquired the world’s first ISO50001 certification (Energy Management System Standard), which helped to set an impressive record with all the international standards for the very first time within the shipbuilding industry.

“We take responsibility to make sure this is a top class vessel meeting our specifications and the norms and standards prevalent for the North Sea”

OVERCOMNG CHALLENGES Of course, with a project of this size, it is inevitable that challenges will arise. Saunes explains: “The main challenge on the project was some delays on

main equipment on top side so we had to install top side modules before they were 100% compete so some of the integration and completion work, top side, had to be done when all the equipment was on board.”

Despite these minor setbacks, Teekay ensured it didn’t interfere with the scheduled time-frame for the Knarr project: “The swivel and the turret solutions were one of the most critical sub-systems on board,” says Saunes. “The swivel turret solution was designed by SBM with the technology we provided, integrated because we had a very oral interaction with Samsung, so the integration of this into the vessel was a preplanned, structured routine from the very beginning.”

When we spoke to Teekay last month, the Knarr unit was currently on its way to the North Sea: “It’s on route, they passed Cape of Good Hope On August 19th, then past the west coast of Africa and Gran Canaria for a pit stop and we should, if everything goes as expected, be in Norway by mid-September,” Saunes explains.

The Knarr unit was right on schedule, arriving into the Norwegian field on Wednesday

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PAGE 35

marsh.com

17th September, taking just 61 days, it was towed successfully

by Fairmouth Marine, the Netherlands based marine contractor, part of Royal Boskalis Westminster. Head quartered in Rotterdam, the Netherlands, Fairmouth Marine has an impressive fleet of tugs consisting of five modern super tugs of 205 tons bollard pull each. Just for the Knarr tow, it took three of these tugs alone.

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As the industry continues to grow, the trend to venture more into deeper and harsher environments continues. Saunes explains this is certainly a trend that Teekay enforce and will continue to follow: “If you look at the FPSO market, Teekay have the most FPSO’s in harsh environments.

In the North Sea, we want to develop shuttle tanker concepts for harsh environments, together with Samsung. Teekay want to further develop this concept to accommodate an FPSO facility so we are moving further north into

29/09/2014 15:11:10

The official naming ceremony of Petrojarl Knarr took place on February 28 at the Samsung shipyard in Korea. Petrojarl Knarr is one on Teekay’s largest FPSO projects to date.

PAGE 36

Teekay Petrojarl

The Knarr Design: Ship Shape/Samsung Contract: Time Charter Contract Status: 2020 + Options

(1x14 years)

Client: BG Norge Length: 256.4m Breadth: 48.0m Water Depth: 410m Mooring Type: Turret Mooring Storage Capacity: 800,000 bbls Oil Production: 63,000 bopd

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harsher environments.

“In Norway, there are opportunities coming up and also further north, towards the ice, there are further developments in the Norwegian and UK sectors for harsh environments,” Saunes adds.

Looking to the future, Teekay is starting to concentrate on Brazil for further development.

With offices and three FPSO’s currently operating in that region, Saunes explains: “Brazil is an important sector for further development, it’s no question that Brazil is looking forward to huge development programs. The environmental conditions with respect to wind and waves is not as severe as the UK and Norwegian waters, so Brazil is an important sector in the FPSO market.

“We have just delivered an FPSO that was in Singapore, it went straight out into the field and started production. We have a joint venture with the Odebrecht oil and gas company in Brazil. We have a 50/50 joint venture with Odebrecht for the development of these type of projects and operations in the Brazilian market,” explains Saunes.

W ith the Knarr vessel expected to commence operations on the Knarr field, offshore Florø, Norway’s westernmost town, later this year, it seems as though Teekay’s prominent position in the industry is only set to grow: “Our concept is we build the assets, so as the owner of the assets we develop the assets and we go out and build these together with the yard. We act as a contractor, as a service provider to the oil companies,” concludes Saunes

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PAGE 37

“Focus, expand, strengthen” Editorial: Christian Jordan

Boskalis Singapore has seen the benefits of ongoing investment in infrastructure and offshore projects on the island state. In recent times, the company has invested heavily in new equipment and also completed major projects in and around the region. Regional Business Manager, Pranab Choudhury explains more…

Singapore is at the forefront of the global offshore industry; whether it’s with jack-up rigs, Floating Production Storage Offloading units (FPSOs), marine services or deepwater technology, Singapore has well and truly cemented its position as one of the world’s leading offshore geographies.

Singapore has 70 per cent of the PAGE 38

world market for jack-up rigs and 70 per cent of the global market for the conversion of FPSOs. In 2011, Singapore’s marine and offshore industry’s total output grew to S$12.9 billion and its value-added was some S$4.5 billion. The marine and offshore industry employed almost 75,000 workers in 2011.

To top things off, the Singapore government is expecting the offshore industry, and the related supply chain that has subsequently developed, to grow further in the future, saying: “The marine and offshore industry is on a roll, buoyed by high oil and gas prices and an ageing offshore fleet. Singapore has been a big

Boskalis Singapore beneficiary of the boom, having carved a reputation for consistent high quality and timely delivery.

An expert cluster of marinerelated service companies such as those providing classification services, maritime law and insurance services, and offshore support services has developed here. The industry also reaps significant gains from the country’s robust and dynamic supply chain and precision engineering infrastructure.”

So considering that Singapore is widely recognised as an offshore and maritime hub, it makes sense for the world’s biggest offshore organisations to have a presence here; and this is exactly why Boskalis set up here in 1983. Royal Boskalis Westminster N.V. is a leading global maritime services company operating in the dredging and inland infra, and offshore energy sectors. Headquartered

in the Netherlands, the company is active in projects in the energy and ports markets. Its main clients include oil companies, port operators, governments, shipping companies, international project developers, insurance companies and mining companies.

Regional Business Manager for Boskalis in Singapore, Pranab Choudhury tells Total World Energy that the local business is contributing greatly to the overall strategy of the group.

“Boskalis Singapore was set up in the year 1983 to execute projects in Singapore and the region. It is a 100% subsidiary of the head office in the Netherlands.

Over the years we have completed several very large projects such as the land reclamation works in the Tuas and Jurong areas of Singapore and the phase 2 expansion of the Port of Tanjung Pelepas in Malaysia.

“Globally, Boskalis has more than 11,000 employees, including our share in partner companies.

We operate in over 75 countries across six continents. Our versatile fleet consists of over 1,100 vessels and equipment.

“The strategic vision for Singapore and the region is intricately interwoven with the overall strategy of the Boskalis group, which is built on three core principles; Focus, Expand and Strengthen.”

LOCAL PROJECTS In Singapore, Boskalis has already announced its intention to actively participate in the country’s upcoming land reclamation and infrastructure expansion projects in the energy and port industries and Choudhury explains where the company has already been successful, demonstrating its unique and wide-ranging

PAGE 39

capabilities.

“We have been through several challenging projects which have been intellectually stimulating and technically challenging.

“We completed two very challenging projects for Petrofac and Petronas in their offshore fields in the Gulf of Thailand. The locations were some 140 km offshore and subject to high swells.

The work required precise dredging to replace soft materials near one of the foundations of the platform.

A very high degree of safety was required due to the proximity of dredging to the platform which needed to be operational during the execution of the dredging

works. Also a very high degree of precision dredging work was required as the sea bed was at 65m water depth. The work was carried out by The Queen of the Netherlands very smoothly. In fact The Queen of the Netherlands is only one of the handful of Trailing Suction Hopper Dredgers (TSHDs) that’s capable of dredging at that water depth.

“In the Changi Outfall project, we placed 2.8 m diameter concrete pipes at more than 40m water depth. Not only were these elements placed with great accuracy; they had to have watertight joints. Therefore, preparation of the gravel bed and the joining

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of the elements had to be done with great accuracy. As in many other projects, we came up with several innovative designs and work methodologies in the Changi Outfall project.”

Choudhury recognises the recently completed work done on the Shell Bukom Single Point Mooring Pipeline Replacement project as one of the most technically challenging projects in the region.

“The work on the Shell Bukom Single Point Mooring Pipeline Replacement project has been successfully completed.

The scope of works included dredging, removal, replacement and protection of the Single Point Mooring (SPM) 48” subsea pipeline. This project was located within close proximity to the Shell Bukom refinery and also in the vicinity of a coral reserve.

“One of the highlights of the project was the strict safety and environmental standards within which Boskalis had to execute the project. Our TSHD, Conellis Zanen, successfully completed the trenching works for the SPM and Zinkoon 6 did the rock protection works on top of the replaced pipeline. The fall pipe vessel Zinkoon 6 was selected due it’s capability to place gravel with accuracies as high as 10cm. A very special technique called the ScradingTM technique was used for placing of the rock with Zinkoon 6. This technique ensures that the rock/gravel is placed with highest level of accuracy and with minimum impact to the pipeline.”

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PAGE 41

announced in the area will present big opportunities that the company intends to capture.

“Singapore and South East Asia is a strategic market for the company and is expected to grow in the medium to long term,” says Choudhury. “Singapore has already announced several large land reclamation projects in the next two to five years and we are keen to participate in and add value to these projects. Similarly, the other countries in the region have national plans for expanding their infrastructures in the energy and port sectors. Our strategic vision is to be the leading service provider in the field of innovative and competitive all-round solutions to our customers in this region.”

The Gross Domestic Product (GDP) in Singapore expanded 2.4 per cent in the second quarter

PAGE 42

“One of the highlights of the project was the strict safety and environmental standards within which Boskalis had to execute the project”

of 2014 over the same quarter of the previous year. The GDP Annual Growth Rate in Singapore averaged 6.86 per cent from 1976 until 2014, reaching an all-time high of 19.80 per cent in the second quarter of 2010 and a record low of -8.90 per cent in the first quarter of 2009. It’s because of this fantastic growth that many infrastructural projects have been given the go-ahead in the country.

“The growth of Boskalis Singapore has been, quite literally, directly related to the growth of the island state,” explains Choudhury.

“We have been fortunate to be involved in almost all major land reclamation projects in Singapore; thereby helping Singapore to grow in size. Singapore is also a major player in the energy sector due to its petrochemical hub on Jurong Island. Most the land

Boskalis Singapore for this petrochemical complex was created by land reclamation works, in which Boskalis played a prominent role. Similarly the expansion of the Shell Bukom refinery was done by combining two islands and reclaiming the land in between these islands; again Boskalis was involved in this reclamation work.

“Boskalis was also involved in the land reclamation of the Changi area; wherein the present airport is located. We are happy that we could be a partner in Singapore’s vision to be the aviation hub in the region.

“Another sector where Boskalis has been involved in Singapore is the maritime and port sector. Since 1983, Boskalis has been involved in dredging and deepening of the most of the fairways in Singapore straits; thereby helping the ports to grow in capacity and allow bigger vessels to call in Singapore.”

Dredging is vitally important to the flow of vessels through waterways, not only in Singapore, but around the world. Without the many and almost non-stop dredging operations worldwide, much of the world’s commerce would be impaired, often within a few months, since much of world’s goods travel by ship, and need to access harbours or seas via channels. Recreational boating also would be constrained to the smallest vessels.

from our overall strategy of Focus, Expand and Strengthen. Therefore expanding and strengthening our fleet to provide superior value to our customers is an ongoing process. In this regard, we are modernising some of our existing vessels with more enhancements such as the latest navigation and survey systems. There are also a number of new-builds in the pipeline.”

Naming just a few of these newbuilds, Choudhury explains that the company will be investing in a new self-propelled megacutter, new trailing suction hopper dredgers and new floating sheerlegs.

“We are planning for a new

large size cutter-suction dredger with a total installed power of 23,700 kW and a pump ashore capacity of 15,600 kW. This new megacutter has been designed by our own engineers from the central technical department. It also follows our NINA safety standards during design and construction.

“Boskalis has been investing in both the large size and small size dredgers. Recently, two trailing suction hopper dredgers of 4,500 m3 capacity, named the Causeway and the Strandway, have been commissioned. In 2015, a third 4,500 m3 trailing suction hopper dredger will be added.

“We are also expanding

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SIGNIFICANT INVESTMENT To ensure that the company’s capabilities remain in line with need of the industry, significant investment is always taking place for Boskalis. Choudhury says that investment in the fleet will be a continually ongoing part of the company’s overall strategy.

“Investments in our fleet follow

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our capacity in the heavy lift section with the addition of the Asian Hercules III. It is a highly manoeuvrable floating sheerleg crane with a hoisting capacity of 5,000 tons. Delivery is scheduled for end 2014.”

In January this year, the company celebrated the naming of two of its newest vessels, NDURANCE and the NDEAVOR at the Keppel shipyard in Singapore.

“The NDEAVOR and NDURANCE are two new additions to the Boskalis fleet. They are truly multipurpose and very versatile vessels that can be used for a broad range of projects. This fits in with our goal to take on a wider range of projects and to provide our clients with even better value and options in execution. The versatility of these vessels helps us to provide clients with wide ranging flexible solutions that other vessels in the market are not able to provide easily,” explains Choudhury.

“These DP-2 vessels can be outfitted for cable-laying or a wide range of other tasks including;

PAGE 44

diving support, subsea rock installation, offshore construction support, salvage assignments and even dredging. The large accommodation houses up to 98 persons.

“As in many other projects, we came up with several innovative designs and work methodologies in the Changi Outfall project” “Both new 7,500 DWT vessels have a length of 99m, a breadth of 30m and a design draught of 4.7m.

A six point mooring system is part of the standard outfitting of the vessels. The NDEAVOR is equipped

with a helicopter deck. With its 5,000 tons capacity turntable, the NDURANCE will undertake cablelaying activities in a wide range of project situations.

“The NDEAVOR was commissioned in the later part of 2013, and played a pivotal role in the Melampaya project in the Philippines, for Shell Philippines. In this project we used the NDEAVOR to execute the seabed excavation and rock installation work. As the project was carried out next to an operating platform, it was very important to reduce the number of vessels and to have one versatile vessels which can perform diverse range of activities.

“The NDURANCE was commissioned for a cable laying project in Indonesia which she completed in record time under very difficult site conditions,” he says.

THE FUTURE As we move through Q4 towards the end of 2014, Boskalis in Singapore has one significant project on the horizon which is

Boskalis Singapore

exciting everyone at the company.

“The Tuas Mega Port development comes from one of key recommendations by the Strategic Economic Planning Committee of Singapore. The plan was one of the highlights of the National Day Rally speech 2013 by the Prime Minister of Singapore,” says Choudhury.

“By implementing this plan, Singapore would consolidate the port capacities in the deeper waters of Tuas from the present locations in Tanjong Pagar, Keppel, Brani and Pasir Panjang terminals. This would serve two major objectives; firstly to free up some very prominent high value land banks in the Central Business District and secondly to increase capacity of Singapore ports almost by a factor of two. The capacity is also planned to be increased from 35 million TEUs per annum to 65 million TEUs per annum. It is expected that this increment would come from building four large size integrated terminals in the Tuas

area called the Tuas Mega Port.

“We in Boskalis have been keenly following the development of the Tuas Mega port and are equally keen to be a partner with Singapore in the development of the various phases of the port.

We are happy that Boskalis and our partners have been awarded the works for the first phase; also called the Finger One.” Boskalis will work alongside Hyundai, Samsung, Penta Ocean, and Van Oord on the project involving land reclamation work, dredging and construction of 3.4 kilometres of quay wall.

“Tender process for the second phase i.e. Finger Two is in progress,” says Choudhury. “The remaining two phases are expected to come in the next few years. We are very keen to the involved in all the phases of the Tuas Mega Port development as we strongly believe that our experience in delivering large and complex projects would be valuable strengths for this challenging project.”

So it seems that there is much to be excited about at Boskalis in Singapore and as this exciting island state continues to develop, there is no doubt that the scope of work that the company undertakes will grow and develop. Hopefully, the journey into the future will mirror Choudhury’s personal experience over the past 13 years with the company. “I joined the Boskalis team in 2001, after spending several years in both the private and the government sector. Since then, it has been a tremendous journey of excitement and fulfilment.”

The Regional Business Manager is in no doubt that the company has the ability to service its clients across all of their dredging, inland infrastructure, offshore energy, towage and salvage needs.

“With the complementary strength of the group companies; Boskalis group has evolved into an organisation that can provide a one-stop fully integrative service to its customers,” he concludes

PAGE 45

Is China now the go to region for offshore services?

Editorial: Roland Douglas

The offshore industry is changing its approach when it comes to the supply of equipment. The global economic slowdown had serious impacts on all industries and especially the worldwide energy market. So exploration companies and oil nationals are now looking to reduce their costs without losing any quality and looking to China might just help them do this.

Just six months ago, international news agency, Reuters, released a report suggesting that the face of the supply market into the global oil & gas industry is changing. The company suggested that the big-name players in oil are now turning to China for services and equipment; including vessels, rigs and FPSOs; and they are being attracted by ‘lower costs and a newly acquired expertise that is challenging more

PAGE 46

established rivals’.

Backed up by research from industry consultants IHS Petrodata, the report states that there has been an ongoing increase in the amount of offshore rig orders for Chinese yards and since 2008, demand has been on an upward curve. In 2013, 42 jack-ups were ordered from China, 30 from Singapore and just eight from other yards around the world.

And it seems like Chinese companies are now becoming difficult to ignore, surfacing across the supply chain everywhere from the Middle East, the North Sea and North America to frontier areas like Mozambique. And it’s not just shipyards; it’s everything from State-run and privately controlled Chinese rig makers to oil and gas services and engineering firms.

So why has Chinese expertise grown

COSCO Shipyard so much in the past decade? According to IHS Petrodata and Reuters, it’s down to strong government support, plentiful labour and an abundant supply of raw materials like steel. And the growth forecast shows no signs of a slump with industry experts stating that Chinese companies could force the global hub of major offshore oil equipment manufacturing to move to ‘the Middle Kingdom’ just like Singapore and South Korea overtook the United States and Europe in the 1990s.

“The Chinese provide products with better value,” said Scott Darling, Hong-Kong based head of Asia oil and gas research at JPMorgan, “and they are experts in managing supply chains, thanks to their domestic experiences.”

JPMorgan hosted an investor tour of the Middle East in March to study the competitiveness of Chinese energy equipment and services suppliers.

And it’s not just offshore where the Chinese are

excelling; in the area of land drilling equipment, a number of privately run companies have emerged as major overseas players. These include Honghua Group Ltd, the second-largest land rig manufacturer globally with 80 per cent of revenue driven by overseas orders, and Hilong Holding Ltd, which started its overseas venture in 2005 and is now the world’s second-largest drill pipe maker after Houston-based NOV (National-Oilwell Varco Inc).

In the Reuters report, Amy Zhang, Hilong’s chief strategy officer said: “Drill pipes are crucial to oil producers.

Previously their drilling schedules were sort of dictated by just one

company, NOV. Now clients have more options. We filled in the gaps.”

Importantly, research shows that this is not just a fad while oil companies look for a cheap deal following the global recession; far from it. Some of the biggest names in the industry have switched their equipment supply chain to China. Shell is currently the biggest buyer of equipment and services from China among its foreign rivals. Its procurement from China jumped to $3 billion last year from $1.9 billion in 2012 and $1 billion a year earlier according to Shell China spokesman Jiangtao Shi said, adding that one third of its 2013 China-made equipment was allocated for

PAGE 47

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COSCO Shipyard international projects away from China.

Price is a major issue and reports suggest that COSCO Corp, China State Shipbuilding Corp, China Shipbuilding Industry Corp, Yantai CIMC Raffles and Offshore Oil Engineering Corp can build a jack-up rig for $170-180 million, significantly lower than the $200-220 million price tag for the same rig built in Singapore.

And although the Chinese are relative newcomers to the global oil & gas industry, there skills are developing fast, in part down to the investment of companies like Shell in the region.

“Our growing procurement spend in China is a reflection of the progress we are making in implementing one of our strategic priorities in China, which is taking Chinese enterprises overseas,” Jiangtao Shi told Reuters.

But today, Chinese firms still lag behind their international counterparts

when it comes to the construction of complex equipment like deepwater rigs and hydraulic fracturing, or fracking, equipment. They also lag in building complicated petrochemical and liquefied natural gas plants, a business still dominated by Japanese, Korean and European firms.

But one organisation at the forefront of the oil and gas industry in China is the COSCO group and in particular its subsidiary companies, COSCO Shipyard Group Co., Ltd. and COSCO Shipbuilding Industry Company.

QUALITY SERVICE COSCO Shipyard Group Co., Ltd. and COSCO Shipbuilding Industry Company engages in large vessel building, offshore engineering construction, heavy steel structure services and also services in ship repair and building sets as well. It is one of the

largest ship repairing companies, and leading technology and management, companies in China, repairing more than 700 large vessels each year with more than eight million deadweight tonnage (DWT) ship building capacity every year.

With shipyards (that actually make up subsidiary companies) at Dalian, Nantong, Zhoushan, Guangzhou, Shanghai and Qidong, and with a number of other service enterprises COSCO is now recognised for its excellent products and service.

In China, and increasingly around the world, the company’s shipyard ranks in the top position in the ship repairing industry, especially with VLCCs (Very Large Crude Carriers) and modified FPSOs. Challenging the views above that Chinese yards are still behind their international counterparts when it

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comes to construction of complex equipment, COSCO Shipyard Group boasts an important moment in its history, when it built and delivered the world’s first independently designed cylindrical-type ultra-deepwater offshore oil drilling platform, Sevan Driller.

Because of the way it looked, this piece of kit attracted much attention in the offshore industry.

The company was also responsible for the construction of the world’s first SUPER M2 with a self-propelled power system and the first domestic marine cable-laying ship refitted ultra-deep offshore pipe-laying ship, the Caesar.

RIDING THE WAVE Using all of its knowledge, expertise and skill, COSCO’s shipbuilding divisions have seen major success over the past few years and the company is certainly enjoying the position that Chinese yards finds themselves in as international oil companies look for high-quality products and services at lower cost.

In October 2013, the company announced that COSCO (Nantong) © Shell PAGE 50

“In return for the vote of confidence, COSCO (Dalian) Shipyard will deliver the vessels in satisfaction of timeliness and exacting requirements of our client”

Shipyard and COSCO (Dalian) have won shipbuilding orders today worth over USD $400 million. In a job expected to take two years at COSCO Nantong, the yard was contracted to convert a semi-completed hull to a high end floating accommodation unit for a total consideration of over USD $170 million.

At COSCO Dalian, new contracts were awarded for a new 30,000 DWT cargo and training ship as well as a jack-up drilling rig. According to COSCO, the contract values were USD $53.3 million USD $180 million respectively.

At that time 12 months ago, the company was also celebrating the successful delivery of the Galloway Express, a 134.8 meter, 4500 m² livestock carrier to Vroon, demonstrating its diverse capabilities in shipbuilding away from the offshore industry.

In August 2014, global logistics and offshore supply company, Maersk Supply Service announced that it had ordered vessels from COSCO in a US$470 million deal as the company seeks to revamp its fleet. This was the first time that Maersk Supply Service, the offshore supply unit

COSCO Shipyard of AP Moller-Maersk Group, has ordered vessels from China.

The order was for four subsea supply vessels, with the price of was vessels reported to be around US$117.5 million each. Reportedly, the deal also includes an option for two more vessels.

Construction will take place at the COSCO shipyard in Dalian and delivery is scheduled between the fourth quarter of 2016 and the first quarter of 2017.

Initial reports suggest that the vessels will be able to operate up to 3,000 metres underwater.

“With this new order in China, we have taken the next step in our extensive newbuilding programme.

“We are reshaping our fleet to focus primarily on anchor handling tug supply vessels and subsea support vessels.

In a long-term perspective, we see great potential in these segments,” said Maersk Supply chief executive, Carsten

Plougmann Andersen.

Mr Liang Yanfeng, President of COSCO Shipyard Group and Chairman of COSCO (Dalian) Shipyard said: “We are happy to have been awarded this contract by Maersk Supply Service to build four subsea support vessels. In return for the vote of confidence, COSCO (Dalian) Shipyard will deliver the vessels in satisfaction of timeliness and exacting requirements of our client.”

Further bolstering the company’s strong pipeline was the announcement last month that contracts have been secured at the Qidong and Dalian shipyards for the construction of one Floating Accommodation Unit (FAU) and one Module Carrier. The contracts are valued at a total of US$230 million.

At Qidong, the contract came from a company based in Singapore and the expect delivery date of the FAU is the first quarter of 2017. There is also an option

for more FAUs in the future.

At Dalian, the contract is for the build of one 21,000 deadweight ton (dwt) Module Carrier for a European company. The expected date of delivery is in the second quarter of 2016.

None of these contracts were from companies related to COSCO shareholders or directors.

All of these contracts, and all of the subsidiary shipyards and entities that operate under the COSCO Shipyard umbrella, all demonstrate the core values of the entire organisation: “Hard working, Innovation, and Beyond,” as the spirit of enterprise; “Unified development and create value,” as the core conception; “Revitalise the national shipbuilding industry,” as a mission and all of this contributes to an overriding focus for the COSCO Shipyard Group: Achieving fast development and building a world-class shipbuilding enterprise

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Safety, quality and efficiency from LSE Editorial: Roland Douglas

Labuan Shipyard and Engineering is located in Victoria Harbour, Labuan, strategically close to one of the busiest shipping lanes in South China Sea. It has the capacity of 36,000 tonnes per annum of product throughout and it is capable of building and handling ships of up to 16,500 Dead Weight Tonnage (DWT) and offshore structures of up to 12,000 tonnes. Total World Energy finds out more about recent achievements that the company is understandably very proud of…

As we have found this month, and in our last few issues, Southeast Asia is becoming a major player in the global oil & gas industry. The Gulf of Thailand has many exploration and development projects underway, the South China Sea has a number of prospective opportunities and it’s the same for the Celebes Sea and

PAGE 52

Andaman Sea. Then there is the Indian Ocean, south of Malaysia and west from Australia, which will be home to Shell’s titanic Prelude FLNG facility.

Because of this on-going development in the region, a strong supply chain has grown in the oil & gas sector with countries including Singapore, Indonesia, Australia and

Malaysia all now home to big name players who are driving local innovation to new heights.

In Malaysia, one of the most prominent companies in the oil & gas industry is Labuan Shipyard and Engineering, a subsidiary of Radimax Group and a leading engineering and construction company with core businesses in oil & gas,

Labuan Shipyard engineering and fabrication, shipbuilding, ship repair, refitting, modernisation and maintenance of naval crafts.

The yard itself has been in existence since 1972 and has built up an extensive and proven track record in oil and gas engineering and fabrication, shipbuilding, ship repair and construction of power barges. Tank coating services has recently been introduced and is offered to ship owners for their new or existing ships.

Before gaining its current identity in September 2005, the business was known as Sabah Shipyard and was

“This expansion will transform LSE into a complete solutions provider in the shiprepair business, providing the highest quality of services in the most efficient manner�

always attractive to oil and gas companies because of its location. Labuan is strategically located within international and shipping and air routes between the Indian and Pacific Ocean.

Sea transport and import/ export of goods are well served

by Labuan Liberty Port, one of the best deepwater ports in the East Malaysian region. By air, Labuan is readily accessible to international destinations via Kuala Lumpur and Kota Kinabalu.

Regular ferry services are also available between Labuan and mainland Sabah, Sarawak and Brunei.

PAGE 53

PERFECTLY PLACED Labuan Shipyard and Engineering (LSE), because of this strategic location, is perfectly positioned to be the shipyard and engineering contractor of choice to the world’s oil companies that operate in the region and after LSE’s parent company announced recently that is was looking to expand its already impressive portfolio of services which includes

PAGE 54

shipbuilding, engineering and non-clinical hospital support services.

Group Chief Executive Officer Datuk Abdul Rahim Mohd Zin said: “LSE is well positioned to offer a compelling value proposition to the oil companies operating in Sabah and Sarawak due to its strategic location as well as proven technical capability to undertake the engineering

and fabrication of deep-water installations.

“We have the expertise and the capabilities to take on assignments on biomedical and facilities engineering maintenance services, healthcare waste management services, workshop and fleet maintenance services as well as cleansing services. We are looking at possibly expanding our services regionally, too,” he said.

Labuan Shipyard “We have identified new areas of investment and are constantly on the lookout for M&A (merger and acquisition) opportunities that has the potential to create greater value for our core businesses,” he added.

A STRONG HISTORY After being awarded its major fabrication license in 2011, LSE has gone on to complete prestigious projects for some of the world’s major oil and gas players.

After obtaining its license, the company participated in the submission of tenders for major fabrication services for Petronas Carigali and other Production Sharing Contractors (PSCs) worth RM2.2 billion.

LSE won the tender, based on competitive bidding, for the Engineering, Procurement, Construction and Commissioning (EPCC) of the Permas Production (PR-PA) Substructure and the Interim Production Facility (IPF) for Murphy Sarawak SK311 Development Project.

LSE had successfully completed the contract in record time, handing the project over within a remarkable four and half months from the date the contract was awarded.

As a further testament to its capabilities in oil and gas, LSE had also bagged a robust track record by constructing a wide range of offshore structures and platforms for Petronas Carigali, Esso Production Malaysia Inc. (EPMI), Sabah Shell Petroleum Co. Ltd. (SSPC), Sarawak Shell Berhad (SSB) and Hyundai Heavy Industries, Korea. These include modules, module frames, topsides/ decks and facilities, living quarters, helidecks, flare-booms and bridges.

Among its major achievements were the Lawit-A Project (five

Modules and Man Support Frames (MSF) totaling some 10,000 tonnes) for EPMI and the Kinabalu Drilling Platform A (KNDP-A) Integrated Deck weighing 3,400 tonnes for SSPC. LSE is both ISO 9001 and OHSAS 18001 qualified, and it expects to achieve the ISO 14001 qualifications before the end of the year, making it the only shipyard in Borneo and the second shipyard in Malaysia to be awarded with all three ISO certifications.

TANK COATING In May this year, LSE announced that it was ready to make a move

into a new sector – providing tank coating solutions for mediumsized vessels of up to 140 metres in length – as part of Radimax’s move to diversify the company’s portfolio.

Diversification into this sector will mean targeting vessels who sail along the East Malaysia route and also those operating between the Far East and the Middle East/ Europe. The advantage here will be vessel operators will not have to incur significant costs by changing their routes for coating services as is currently the popular practice.

“We are aiming for international

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YR Marine & Engineering is an industry leading company involved in blasting and painting work for ship repair and process platform fabrication at various yards in Malaysia. The company also as acts as a dehumidifier supplier and scaffolding, piping and insulation services provider.

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PAGE 55

market for this segment. As such, we are teaming up with an established Malaysian tank coating service provider, YR Marine & Engineering Sdn Bhd. With this partnership, we are able to provide all levels of tank coating solutions, from standard epoxy coatings to the more stringent zinc silicate coatings and sophisticated coatings such as Marine Line coating,” Datuk Rahim said.

LSE’s Chief Operating Officer, Azizul Hanafee Mohd Zain said: “Being the market leader in the industry, LSE possess a strong

PAGE 56

track record and has always been at the forefront in providing the latest and above par services.

This expansion will transform LSE into a complete solutions provider in the ship-repair business, providing the highest quality of services in the most efficient manner.

“With LSE’s ability to provide overall project management services as well as the integrated ship-repair works, and YR Marine’s expertise, this partnership will allow ship operators to have a convenient single source all-in-one service

provider in the East Malaysia region,” he added.

Tank coating is important business as the coating is used to protect the content of the cargo such as methanol, palm oil and petroleum-based products. Currently, tank coating is undertaken mainly in Singapore but this new venture for LSE will viable alternative that is competitively priced and geographically relevant.

SAFETY AT THE HEART In June, LSE was proud to announce that it had achieved

Labuan Shipyard a considerable milestone as far as safety is concerned. Azizul declared that the company had achieved more than 13 million Man Hours without Lost Time Injury (LTI) since 2009. Not many companies reach such a milestone and the COO attributed the success to the stringent Health, Safety and Environment standards at the yard.

“Safety is our number one priority and it is ingrained into our work culture. It is our overall safety mission to reduce total recordable case frequency (TRCF) by 10% every year. We are committed in ensuring that every employee, subcontractor and those involved with our projects are assured of a safe and healthy work environment,” he said.

“We do not compromise the welfare of our employees. It is our policy to conduct all business in compliance with the acts and legislations of federal and state health, safety, security and environment regulations such as OSHA 1994, EQA 74, FMA 67 and Petroleum Act 84 among others,” he added.

In another safety success, LSE announced in August that it had also achieved more than 1,000,000 Man-Hours without Lost Time Injury (LTI) with its ongoing construction of two Offshore Work/Accommodation Vessels (OWAV) for Sarku Marine Sdn Bhd. Azizul again paid tribute to the yards standards, saying that employees focus had led

on excellence and quality with this project until the vessels are delivered to the client.”

LSE has employed new thinking during the Sarku project, where the company has been employed to design and build two OWAVs equipped with Dynamic Positioning System Class 2 (DP2) and also fitted with Fire Fighting System Class 1 (FiFi 1) for external fire-fighting services, and has subsequently managed to increase its ship block building capability from a previous maximum of 70 tonnes to a new record of 180 tonnes.

“In order to fuel our growth, we are actively tapping into new business streams to prove our commitment as an innovative, capable and trustworthy service provider to our clients. We are already the largest and most well-equipped shipyard in North Borneo and we look forward to further expand our client base and strengthen our product portfolio in order to be the shipyard of choice as well as the market leader in the region for the range of products and services we offer,” Azizul concluded

to achievements including ISO certification. “Safety is paramount and is second nature for all of us here at LSE, which has led to us obtaining the ISO 9001 and ISO 18001 certifications,” he said.

“We strive to maintain our focus

PAGE 57

Boiler power set for African surge Editorial: Colin Chinery

Sixty years after John Thompson produced the first industrial boiler to be manufactured in South Africa, the region’s premier boiler and environmental solutions company in the power and industrial sector is upping the pressure for further growth throughout Africa and Asia Pacific.

The year is 1954. Roger Bannister runs the first four minute mile, rock ‘n’ roll kickstarts with Bill Haley’s ‘Rock Around the Clock,’ the first nuclear-powered submarine ‘USS Nautilus’ is launched, and in the Western Cape the John Thompson company produces South Africa’s first home manufactured industrial boiler.

Sixty years on and the Cape Town business – now the power

PAGE 58

division of ACTOM, Africa’s largest manufacturer and distributor of electrical equipment – is celebrating the anniversary with a R30 million expansion plan.

The 2,000 m2 Greenfield site adjoining its Bellville plant – already the largest heavy engineering manufacturing facility in the Western Cape will see a new workshop for the manufacture of industrial

watertube boilers incorporating new machinery, including 15 ton lifting capacity cranes and, in a separate building, an additional furnace corrugating machine for package boilers. And in a nation with 25 per cent unemployment – more jobs.

John Thompson focuses on delivering sector-best boiler and environmental solutions, and the record is impressive. In 60 years it has supplied over 4000

John Thompson (a Division of ACTOM (Pty) Ltd)

firetube, 300 watertube, and numerous waste-heat boilers to customers throughout southern Africa and around the world.

FAST START Arriving as a successful Wolverhampton company with roots in the Industrial Revolution of 19th-century England, John Thompson came to South Africa in 1935. And from the start, through agency agreements, contributed to the rapid industrial expansion of the country in industries ranging from sugar and paper to petrochemical, fishing and mining.

Now Southern Africa’s premier boiler and environmental solutions company serving the power generation and industrial markets, the company designs - manufactures and services industrial watertube and firetube boilers with steam outputs of up to 350 t/h, as well as related

products such as heat transfer technology.

“Our business is boilers and environmental equipment such as fabric filters, and our objective is to take industrial watertube boilers to the power industry in Africa,” says John Thompson’s Divisional CEO Andy Abbey.

John Thompson‘s industrial watertube designs include coalfired boilers with travelling grate and CAD spreader stokers and fibrous fuel-fired boilers with CAD spreader stokers for dual-fuel firing, as well as pinhole and dump grates, industrial oil/gasfired and waste-heat boilers.

Package firetube boiler designs include coal-fired boilers with chain grate stokers, wood-fired boilers with fixed grates, oil/ gas-fired boilers and custom designed waste-heat boilers.

“We manufacture industrial boiler components and deliver them to anywhere in the world. In

South Africa we normally install and commission this equipment ourselves - whilst outside South Africa we normally engage others to perform the installation work and then commission equipment ourselves - whatever the most cost-effective solution is. We also undertake extensive engineering studies for South Africa’s industrial sector,” says Abbey.

John Thompson designs and builds two core type boilers, namely package and industrial watertube boilers. “Package boilers with a steam capacity up to 32 tons per hour are built in our Cape Town factory and then installed in a fairly short period of time. We sell this type of boiler to customers all over the world.

“Industrial watertube boilers, which again we design and manufacture in-house, have steam capacities of up to 350 tons per hour and pressures up to 110bar. The components

PAGE 59

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such as panel walls, superheaters, boiler tubes, drums, combustion equipment, headers, tubular airheaters, extended surface economisers etc. are transported to a site and erected, usually over a period of 10 months to two years.

“It’s a massive on-site undertaking, and we work on construction and maintenance sites ranging from a sugar or paper mills, to numerous power stations including Matimba, Komati and Tutuka.

“Much of our business is with Eskom, not in the supply of new plant - though we do supply new

PAGE 60

environmental equipment - but with the provision of maintenance services,” Abbey explains.

John Thompson as a company place a lot of emphasis on providing their customers with a strong technical support. Hence, there is a continuous drive to grow their engineering capabilities using the latest state of the art, computer aided design packages and investing in the further education of engineers in the company.

GOING FOR GREEN With the manufacturing industry looking into ways of lowering

energy consumption and reducing energy costs with environmentally sustainable business practices, John Thompson provides equipment for the cleaning up of emissions resulting from the firing of fuels or other processes leading to waste emissions into the atmosphere.

And with rising electricity and fuel prices coupled with a growing demand for green business practices steering many companies towards alternative energy sources, alternative fuel is a major area of the Cape Town company’s extensive R&D programme. “John Thompson design and build boilers that fire biomass and we work with customers to investigate the use of alternative renewable fuel,” Abbey explains.

The development of the MicroGen watertube boiler is one response, catering for the growing demand for a small, mediumpressure, power boilers particularly suited to fibrous-biomass and coalfired co-generation applications.

Configured to facilitate manufacture of the pressureparts in large subassemblies, the MicroGen can be containerised for transportation, minimising expensive and time consuming site construction work.

MAXIMISING EFFICIENCY “Among the reasons why we compete successfully with boilers built elsewhere - China for example, is the high thermal efficiency of our boilers,” says Abbey.

“They are also extremely durable - we have many fully operational boilers in industry that are now 3550 years old - all made to the very highest quality standards.”

Within a company focusing on retention and development of skills, Abbey says it is critical

John Thompson (a Division of ACTOM (Pty) Ltd) that employees are well trained and up to date with latest technological developments. An in-house training centre provides specialist and advanced training and the company also has close relationships with universities and engineering houses.

“Our business is boilers and environmental equipment such as fabric filters, and our objective is to take industrial watertube boilers to the power industry in Africa” “We have a number of graduate engineers and also take people from technical colleges who have technical knowledge but need the practical exposure which we give when we take them into our organisation.”

TARGET ON POWER The African market provides 40 percent of John Thompson’s export market, with a further 40 percent in Asia. Looking ahead, John Thompson is keen to expand its footprint into Africa, with development capacity in amongst others Mozambique, Tanzania and Zambia.

“Up to now we have been selling mainly to the sugar mills and the paper and steel industries.

Going forward our intention is to target power producers,” Abbey concludes

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PAGE 61

On top of the bottom line

Editorial: Colin Chinery

In a short time line, installation and trenching specialists Reef Subsea have won impressive contracts and a growing reputation in the offshore sector. “Our track record is fantastic,” says Chief Commercial Officer Daryl Lynch, “and we aim to become the sector’s partner of choice.”

Reef Subsea is the ocean bed innovator launched in a vertical take-off. Formed only two years ago, the cable laying and flexible product installation and trenching specialist is fast winning a reputation for innovative capabilities and rapid turnaround in major offshore projects.

In late spring this year the Teesside-headquartered business

PAGE 62

completed the L5 Sierra Pipeline, 96 kilometres off the coast of the Netherlands, deploying its state-ofthe-art Q1000 Jet Trencher from the Reef Despina construction support vessel.

And in September the Bøyla Development Project off the coast of Norway - awarded to Reef Subsea in quarter-three of 2013 - was

completed, as with L5 Sierra, ahead of the schedule set by the client.

“With the reputation we have won, we are now tendering more than at any time,” says Chief Commercial Officer, Daryl Lynch.

The Reef Subsea Group, operating from three core offices at Thornaby (Stockton-on-Tees), Aberdeen and Bergen, is part of HitecVision,

Reef Subsea Europe’s leading private equity investor focused on the upstream offshore oil and gas industry.

Headquartered in Stavanger, centre of the Norwegian oil and gas industry, HitecVision has invested in, acquired or established more than 150 companies including add-on acquisitions.

Reef Subsea - Lay & Trench Services - is one of three related but separate and distinct companies within the Reef Group – alongside X-Subsea (Dredging and Excavation) and Technocean Subsea (IMR and Light Construction Services).

EXCEPTIONAL SERVICE “It’s this restructure which enables the business to deliver exceptional service for clients, utilising niche and specific skill sets alongside our own range of sophisticated vessels and technically advanced subsea assets,” says Lynch.

“We launched off the back of completing the very successful

Greater Gabbard scope involving the installation and burial of 41 array cables in simultaneous lay and burial mode.” The commission included project and engineering management onshore and offshore, load-out of the cable, pull-ins and temporary hang-offs “It set down Reef Subsea’s credentials as a leading supplier with a speciality in the installation of flexible products and the capability of burying flexible products put down by ourselves or third parties. Since then we have grown to 120 employees, and we areon the way to securing some pretty significant contracts.”

One of these major contracts, for a Permanent Reservoir Monitoring (PRM) System, was awarded by Statoil for its Grane oil field off the Norwegian coast, where 700 kms of seismic cables are being placed in seabed trenches.

The scope also includes the full project management and engineering, mobilisation/demobilisation,

installation of riser and backbone, material supply and logistics.

“This is another prestigious commission. Not many other companies have done PRM scopes with a plough, and to have this in our track record is fantastic. We are now using our engineering project management skill set to the full.

“These are exciting times for Reef Subsea. As a result of the group splitting into its respective individual companies, we can each tailor our offerings more closely to the requirements of our clients’ projects and really focus on individual areas of expertise. And this will lead to us becoming even more solutions-driven in what is a demanding and complex marketplace.”

EXPECTATIONS EXCEEDED Reef Subsea delivers each project with a single overriding aim - to exceed client expectations. “We go all out to ensure our equipment will provide a safe and effective solution

PAGE 63

Professional offshore personnel worldwide

James Fisher Rumic Fisher House PO Box 4 Barrow-in-Furness Cumbria LA14 1HR United Kingdom Tel: +44 (0) 1229 615456 Fax: +44 (0) 1229 836761 rumic.co.uk for our clients projects, with the most appropriate fleet and equipment used for every task. Not only that, but Reef Subsea has the capability to source project-specific vessels from the wider market.”

Among its leading edge assets are the Q1000 Jet Trenching ROV, embracing the latest technologies in jet trenching and ROV design, and the Heavy Duty Inter Array

ROV design; 750kW of total installed power and 700kW of variable jetting power, capable of trenching pipelines, umbilicals and cables up to three metres depth.

The proven design has been upgraded, based on Reef Subsea’s specific requirement to operate in varying sands and clays, with detailed engineering ensuring bespoke configuration for optimal

(HDIA) Cable Plough from subsea equipment manufacturer SMD, for the simultaneous or post-lay burial of large bend radius products.

Reef Subsea’s Q1000 Jet Trenching ROV embraces the latest technologies in jet trenching and

performance.

“We have introduced assets to the market that are not commercially led but technically led. And we were the first to build a plough dedicated to inter-array cables. Up to this point many operators were using old fibre

PAGE 64

optic cable ploughs and modifying them to complete scopes of work.

And these had the potential to damage cables and give the plough a bad reputation.

“So we brought the right technology into the market. And the Q1000 has been involved in three projects very successfully, with a technology ensuring all the power is going through the swords.

“A lot of people talk about the power of their jetter, but an awful lot of power is being wasted in driving the vehicle itself, the swords are where you need the energy for the burial.”

The Heavy Duty Inter Array (HDIA) Cable Plough provides the ideal solution for simultaneous or post-lay burial of large bend radius products.

The plough is a proven design, capable of providing the safe simultaneous or post-lay burial of submarine cables and flexible products in consolidated soils, including stiff clays.

The ‘multi-depth’ feature enables the plough to provide trench depths from shallow 1.5m to deep 2.4m and by maintaining a low bell mouth and tow point position giving better stability. “In terms of our trenching assets the Q1000 and the HDIA plough are the flagships of the fleet,” says Lynch.

PROTECTING THE BOTTOM LINE Reef Subsea’s core focus is summarised in its strap line - ‘Protecting the Bottom Line’ preserving the seabed while delivering specialist projects on time and within budget “Our experienced onshore and offshore teams are involved throughout the lifecycle of every project, from front-end engineering and detailed design to completion of offshore subsea operations. This is

Reef Subsea a key competency of the business, and one that sets us aside from competitor companies.”

With an emphasis on identifying practical engineering and technical solutions for its client base, Reef Subsea’s vision says Lynch, is to be the leading subsea services partner to energy and construction companies worldwide; the name most recognised for passion, presence and performance.

“With the reputation we have built, we are now pre-qualified and tendering more than at any previous time. Looking to the future we certainly have ambitions to complete scopes in more European wind farms, and expanding our North Sea trenching and laying operations into Norway. At the moment we are taking one step at a time and are focused on Europe. We will take the world on when it comes.

“We are competing with people

who have been around a long time of course. But the way we approach and complete projects is winning a growing reputation, and if you look at the length of our establishment we are extremely well placed for the

“Not many other companies have done PRM scopes, and to have this in our track record is fantastic” future.

“I believe Reef Subsea is now in the optimal position to continue working towards our ambitions of continuing growth and development. Our vision?

To become the subsea partner of choice in our industry.”

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Fuelling up for European demand Editorial: Roland Douglas

Now recognised as a hugely important region for oil exploration and development, Azerbaijan and The State Oil Company of the Azerbaijan Republic is at the centre of a number of important developments that will impact not just Azerbaijani people, but the wider European community.

Today, Azerbaijan is recognised as one of the most important regions in the world for oil exploration and development.

Two thirds of Azerbaijan is rich in oil and natural gas and in September 1994, a 30-year contract was signed between the State Oil Company of Azerbaijan Republic (SOCAR) and 13 oil companies; among them Amoco, BP, ExxonMobil, Lukoil and Statoil to tap deepwater oilfields untouched by Soviet exploitation.

State-owned company, SOCAR, was founded in 1992 after the merger of Azerbaijan’s two state oil companies, Azerneft and Azneftkimiya, and operates

PAGE 66

the country’s two oil refineries and the running of oil and gas pipelines throughout the country. It also works in neighbouring countries, operating fuel filling stations under the SOCAR brand in Georgia, Ukraine, Romania and Switzerland.

Because of Azerbaijan’s position in the international energy industry and the on-going focus that the Caspian region receives from the world’s big name oil and gas players, SOCAR’s role has changed over the years but its reputation has always remained one of strength and excellence.

And recently, there have been many developments that are keeping this major organisation in the headlines, all as it looks to continue with its mission of “providing energy security of the Republic of Azerbaijan, strategic interest on development of oil and gas, and petrochemical industry, support the increase of scientific and technical, economic and intellectual potential of Azerbaijan by applying advanced and eco-friendly technologies, hold crucial position in regional and international energy projects, and maximize the profit from the sale of hydrocarbon reserves

SOCAR and derived products in the domestic and foreign markets.”

FUELLING INTERNATIONAL GROWTH In September, the company announced that it was planning to open 10 new filling stations under its own brand in Romania next year. Romania is an important region for SOCAR and provides huge opportunities for export and expansion.

With the current challenges that surround oil and gas exports from Russia, Romania has a need for diversification in its fuel supplies. It does have domestic reserves of oil and gas, but chiefly relies on Russia for its imports.

SOCAR has been expanding in Romania for some time and opened its first filling station (29th in Romania overall) in Valcea County following a EUR1 million investment in August.

“Aside from the increase in the number of filling stations, we aim to enhance our national coverage. Our future strategy will continue in line with that of 2014. Thus, the company has increased its share capital by over EUR58 million in June,” said Hamza Karimov, CEO of SOCAR Romania.

SOCAR entered the Romanian market after buying local filling stations from

Romtranspetrol and re-branding them in 2011.

The news of the 10 new filling stations came after the launch of the company’s first filling station in Arad County. This is the largest SOCAR filling station in Romania in terms of total area covered, with over 12,500 sqm. The location includes a substantial green area of 7,800 sqm, the actual building having 240 sqm.

Customers are provided with four feeding pumps, one of which is specially designed for trucks. The storage capacity amounts to 180 cubic meters of fuel.

The entire investment in the station is reportedly EUR1.4 million. Additionally the company created 15 jobs on site adding to the more-than-400 that have already been created in the other stations around Romania.

“Through this new filling station we are also entering the market in Arad and I am convinced that our products and services, which meet the highest standards, will be extremely well received by customers. We have reached 30 filling stations, in 13 counties, in less than three years since launching this business. In 2014, we registered the highest growth, in terms of filling stations number, as well as presence in towns,” said Karimov.

Currently, SOCAR has filling stations in the following counties in Romania: Botosani, Suceava, Neamt, Iasi, Bihor, Buzau, Bacau, Vrancea, Timis, Ilfov, Cluj, Valcea and Arad.

As well as Romania, SOCAR was recently working with Bulgaria on cooperation projects with gas. In September SOCAR President Rovnag Abdullayev received the representatives of Bulgartransgaz and Bulgargaz in Baku.

The group celebrated the twentieth anniversary of the signing ‘The Contract of the Century’ and ground-breaking ceremony of the Southern Gas Corridor.

Following the celebrations and the reported ‘friendly discussions’ about cooperation between Azerbaijan and Bulgaria, the group signed two gas cooperation agreements. A Memorandum of Understanding was signed between SOCAR and Bulgartransgaz Company and also a Protocol of Intentions was signed between SOCAR and Bulgaria’s Bulgargaz Company. CEO of Bulgartransgaz, Kirill Temelkov and head of the Board of Directors of Bulgargaz, Botyo Velinov signed the agreements on behalf of the Bulgarian contingent and Abdullayev represented SOCAR.

PAGE 67

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EXPLORATION IN THE CASPIAN Azerbaijan’s total gas reserves are estimated between three and five trillion cubic metres and energy companies from Western Europe continue to encourage Azerbaijan and SOCAR to further exploit these reserves.

To further bolster the company’s already strong reputation when it comes to exploration and development, the company announced in September, through first vice-president Khoshbakht Yusifzade, that it had issued a tender for the joint exploration of two major gas deposits in the Caspian Sea with total preliminary reserves of about 600 billion cubic metres (bcm). The tender is for the Umid and Babek gas deposits Back in 2010, SOCAR announced that it had found at least 200 bcm of gas at the Umid field in the Caspian Sea, describing it as the largest discovery since the giant Shah Deniz deposit that was operated by a consortium of companies led by BP and

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was estimated to contain 1.2 trillion cubic metres of gas.

Babek has estimated reserves of 400 bcm of gas and 80 million tonnes of condensate and SOCAR has produced 390 million cubic metres of gas and 65,000 tonnes of condensate at Umid since 2010.

FURTHER EUROPEAN DEVELOPMENTS With the aforementioned demand for Azer-products from Europe, SOCAR has looked to major European partners to enhance development of its upstream and downstream activities.

One such development is currently being realised in Turkey, in the Aegean region. The STAR refinery project involves the realisation of a new refinery to produce jet fuel and diesel to substitute the imports of these products into Turkey.

SOCAR and Turcas Aegean Refinery, as one of the main projects in the refining/oil/chemistry/energy/logistics

industry in Turkey, will be the largest private investment in this field in the history of the country.

The refinery to be built in the Petkim Aliaga Complex Area will have the capacity of 10 million tons of crude oil per year with an estimated project cost of $5.3 billion.

Currently under construction, the facility is due to be operational in by 2018.

The establishment of this enterprise started from the date of acquisition of the controlling shares of Petkim by SOCAR-Turcas in 2008. In December 2009 the Environmental Impact Assessment was approved and in 2010 the licensing process was finalised by the Turkish Energy Market Regulatory Authority.

SOCAR controls 41.5 percent of the stakes in the project while Turcas has 18.5 percent and the Azerbaijan Economy and Development Ministry owns the remaining 40 percent.

In March 2014, Turcas announced that it was in talks to withdraw from the

SOCAR STAR project by transferring all of its 18% shares to the majority shareholder, SOCAR and in the same month, SOCAR Turkey announced it had agreed a fresh financing package with Denizbank of $500 million to replace the World Bank’s International Finance Corporation and the European Bank of Reconstruction and Development who had withdrawn from a consortium financing the project.

SOCAR says: “The establishment of the plant will provide supply security for raw materials of Petkim and will also create an integrated chain between refining and oil chemistry.

The production at Aegean Refinery will meet the standards in relation to quality of oil products of the European Union and also the plant will possess the clean technologies for production of environmentally-friendly products.”

The other major development that has received much attention from SOCAR

is the development of a new oil, gas processing and petrochemical complex (OGPC) close to the city of Baku.

In April 2012, SOCAR presented this $17 billion capital expenditure downstream project in Baku and in March 2013, it was announced that Houston-based engineering company, KBR, had been selected to provide project management consultancy for the front end engineering and design (FEED) of the gas processing plant (GPP) within the OGPC. To be located on 1,500 hectares, 60 kilometres from Baku in the Garadagh district, the OGPC project will include a refinery, a gas processing plant and a petrochemical complex.

With this project, SOCAR is intending to supply the local market with refined products to cover the increase in the domestic consumption of transportation fuels, while the natural gas and the petrochemical products will be exported.

These two major projects follow other huge developments for SOCAR which include the announcement in May 2012 that BP and SOCAR had decided to commence the FEED for the $25 billion capital expenditure Shah Deniz phase 2 project and the announcement in March 2013 that SOCAR and ConocoPhillips started a hearing program in 14 Azeri regions to get the permit for an onshore 2D seismic exploration campaign.

With all of the development going on at SOCAR and with all of the potential that the land of Azerbaijan offers, it is certain that this organisation will continue to be a key player in not just European but global energy industries now and long into the future. As key projects are realised and retail expansion in other European nations continue, the name SOCAR is sure to become more and more popular among governments and the public all over the EU and further afield.

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Power Plant Kirishi is a very good example of power plant modernization in Russia.

Power plant efficiency rose due to modernization with Siemens equipment from 38 to 55%

Comprehensive efficiency solutions Editorial Tim Hands

With more than 3,300 employees currently comprising its Russian division, Siemens offers a wide range of solutions and services in the country, with its Energy, Healthcare, Industry, and Infrastructure and Cities sectors all occupying leading positions, and all recording major successes in 2013.

As the sole integrated energy company serving the entire energy conversion chain, Siemens is uniquely placed as the only company that provides solutions for all energy sectors, including fossil and renewable power generation, power transmission and distribution and energy services, as well as marketspecific complex solutions for the oil & gas industries.

Siemens’ Russian strategy is

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focussed upon regionalisation, with its representative offices in over 30 Russian cities, as well as localisation along the entire value added chain, including research and development.

Energy efficiency programs, implemented in efforts to support Russia in achieving energy savings of up to 79% of the country’s primary energy consumption, also sit high on the company’s list of priorities.

Vice President for Siemens LLC

Russia and Director for Siemens Energy Sector Russia, Andre Petry, details this further: “The energy sectors of Russia, Belarus and Central Asia play a key role in the modernisation of this sector, in compliance with the government programs, so to achieve a greater customer focus and a better understanding of the needs of local customers, we pursue an active strategy of closeness to customers

Siemens Russia and develop reliable customer service support based on a localisation strategy and centres of competence.

We successfully implement localisation projects and continuously realise investment programs that benefit the economies of Russia, Belarus and Central Asia.”

In recent years these localisation projects in Russia have included Siemens High Voltage Products, Siemens Transformers and Rusturbomash, alongside ongoing projects such as Siemens Gas Turbine Technologies and GIS Production.

The company’s decision to strategically position its Russian service facility in Krasnodar is central to its service provisions, as Petry explains: “Our highly skilled service engineers are available 24/7 to help customers throughout Russia and assigned countries with their expertise on commissioning, service, and maintenance of Siemens equipment.

Through the modernisation and upgrading of gas and steam power plants worldwide, Siemens achieved

200 additional megawatts of capacity in 2011 with the same fuel consumption.” Siemens’ high-voltage switching equipment plant also produces state-of-art circuit-breakers for 110kV and 220 kV voltage, specifically targeted to upgrade power grid in Russia and the CIS. The plant is a key part of Siemens’ global facility network, which has been specifically built in accordance with contemporary engineering solutions.

Petry goes on to outline how Siemens Russia looks to fully benefit from the tremendous savings potential on offer in the country. “By replacing inefficient gas-fired steam power plants with combined cycle power plants, the country could tap a high share of the overall potential available. In addition to current generation inefficiencies, power is transmitted and distributed in the country with losses of roughly 11%.

When compared to the average European loss rate of less than 7%, a modernisation of the national grid system could obviously lead to

substantial additional savings. Russia has one of the biggest efficiency improvement potentials in the world, and the Russian government is aware of this potential and has launched various programs to realise these savings.”

In addition to such inefficiencies in power generation, only a small share of Russian industry has adopted energy efficiency programs, as Petry states. “Most domestic companies are aware of energy efficiency potential, but suffer from the lack of capital for modernisation investments.

In addition, energy efficiency in the building sector is especially deficient since consumers generally have no control over heating, there is a low share of private ownership of apartments, and there are heavy price subsidies. In the transport sector, efficiency is adversely impacted by major energy losses and outdated equipment.” This has triggered a significant reaction from Siemens in efforts to improve the Russian energy system and its potential for

Irsching Power Station holds the world record for power plant efficiency in combined cycle (steam and gas) at 60.75%

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Andre Petry

upgrading, with its key levers for improving efficiency each capable of achieving savings in the billions.

In line with such efficiency aims, Siemens’ key energy project in the Russian oil & gas industry sees it set to supply SGT-800 gas turbines, compressors and service to its customer Yamal LNG, itself a joint venture of Novatek JSC, Total SA and CNPC. “It’s the biggest project in the history of our IP business unit,” explains Petry, “and it’s the first project realised in such heavy geographical and climatic conditions, as well as our first experience of equipment supply for the LNG plant’s auxiliary power station. It is also important as Novatek is the biggest independent gas producer in Russia.”

April of this year saw Siemens win the tender for the supply of 28 E-Houses for Yamal LNG. These

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fully equipped and pre-tested power equipment centres, E-houses are the ideal approach for a fast and reliable power supply, consisting of one or several metal or steel modules to protect the equipment they house.

“E-houses are widely used in the oil & gas and mining industry,” Petry states, “and ever more frequently for the installation of equipment in other sectors. They are an optimal power supply solution for every requirement.

The industry needs a reliable and efficient power supply as well as a flexible solution that can be adapted to the individual requirements.

E-houses are fast and easy to install and can be used as interim solutions.

They are easy to upgrade, and use available space optimally.”

All of these upgrades and innovations follow an ongoing global study where Siemens has analysed the Russian energy system and its

potential for upgrading and identified four outstanding areas of focus when it comes to efficiency that could potentially result in huge savings.

“Firstly, efficiency improvements in the power plant fleet provide the greatest leverage for savings. For instance, the natural-gas-fuelled steam power plants widely used in Russia feature particularly low efficiencies. If these were replaced by high-efficiency combined-cycle power plants by 2030, cumulative fuel savings of up to 900 billion cubic meters (bcm) of natural gas would be possible,” says Petry. The market value of this amount of natural gas is around €180 billion, around one third of which would need to be dedicated to the necessary investments in the power plant fleet. Russia’s current planning already envisages tapping half of this potential.

“Secondly, during oil & gas

Siemens Russia exploration, wastage is high and many of the resources are going unused.

For example, two thirds of the gas escaping as a by-product of oil production is being flared off. Russia has plans to reduce flaring by 90 per cent,” he says. If at least half of the natural gas currently being flared off could be captured, an extra 20 bcm of natural gas, with a market value of €4 billion per year, could be put to good use. Ultimately, by 2030, natural gas worth more than €60 billion could be marketed instead of wasted and further potential could be realised by improving efficiency in the gas pipeline; for example, by using highefficiency compressors.

“Thirdly, Russia is already giving the modernisation of its power grid high priority in order to make considerable savings by reducing losses. Around half of the transmission grid in Russia and two thirds of the distribution network are more than 30 years old and no longer state of the art. This means the loss rate is on average 11 per cent,” Petry states. Each percentage point less loss could save natural gas with a market value of around €0.5 billion euros per year in power generation. Upgrading the grid with today’s state of the art technology, with average losses of only seven per cent, would thus save nearly €2 billion per year in fuel costs in power generation.“Finally, efficiency improvements in consumption will also help to modernise the energy chain.

Research suggests that Refurbishing Russia’s residential buildings could halve energy consumption, providing huge savings to both suppliers and customers. More than 80 per cent of residential energy consumption goes into space and water heating so priority needs to be given to thermal insulation, modernising household heating boilers and upgrading district heating systems. Theoretically, this would enable primary energy

sources worth more than €13 billion per year to be saved,” highlights Petry. Many initiatives have already been launched in Moscow and St Petersburg among other big cities, with the goal of improving domestic energy efficiency. These have focussed on thermal insulation of outside walls, installation of consumption meters and monitoring systems, and modern controls for heating systems. Of the four areas of efficiency improvement, this is the most arduous; refurbishing buildings is a long-term affair – in Germany for instance, the government’s target of renovating at least two per cent of all buildings per year is far from being

achieved. Then there is also industry and transportation, where energy efficiency improvements could result in energy savings worth billions each year.

Fortunately, Siemens offers a wide range of energy efficient solutions for power generation, transmission, distribution and consumption as well as infrastructural and industrial solutions so Russia will remain a primary focus for this global power player with Petry stating: “The Russian energy market is one of the most dynamically growing and at the same time one of the most competitive energy markets in the world.”

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Offshore’s very important passengers Editorial: Colin Chinery

Vessels with high accessibility and personnel transfer capability are critical to avoid unnecessary downtime for the offshore operator. And crew comfort is an increasingly important factor as Philip Woodcock, Operations Director of Offshore Wind Services 360,000 safe crew transfers since 2006 – explains.

They are Offshore’s VIPs - centre stage of one of the most dynamic areas of the offshore sector - the crew transfer or service vessel.

The efficient transfer of engineers is a lynch-pin component; critical to scheduled and non-scheduled operations. And a CTV must be safe, fully functional and – increasingly significant - comfortable.

“We are operating taxis,” says Offshore Wind Services Operations Director, Philip Woodcock. “When you get into a taxi you

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want one that’s big enough for you and your suite case, and when you get out at the other end you are not feeling car sick.

Same thing with a crew boat.”

Offshore Wind Services (OWS) is a vessel owner dedicated to providing vessels for the offshore wind industry, managed by Workships Contractors, the Rotterdam-based privately-owned ship and project management company.

Across the sector operators are designing new vessels to meet the

changing demand of the offshore wind industry, with new-build larger vessels providing better sea keeping qualities as well as greater payload capacity.

Key areas are fuel efficiency and the ability to access wind farms in higher sea states. And with staff retention a growing issue, another requirement is comfort for crew and passengers.

SAFE TRANSFER RECORD Now in its 25th year and currently operating CTVs in the UK, the Netherlands and Germany for companies such as Vattenfall, Dong Energy, RWE npower and ENECO, Workships and OWS have delivered more than 360,000 safe crew transfers since 2006.

Founded in 1998, and with a background in larger oil and gas assets such as jack-ups and accommodation

OWS vessels, Workships expanded into the crew transfer niche three years ago, launching OWS as a joint venture with Royal Doeksen. Twelve months later OWS acquired leading operators Offshore Wind Power Marine Services of North Wales.

OWPMS was one of the original players in crew transfer, a vision born of experience. Following their involvement in the construction of the UK’s first large scale offshore wind farm project at North Hoyle in 2003, Paul Walsh and Eddie Ward saw the growing need for dependable support vessels throughout the UK and Europe, co-founding, Offshore Wind Power Marine Services in 2006.

“They were part of that first pioneering division that went out and started building wind farms, and a lot of the rules and equipment in place came from early guys like Paul and Eddie,” says Philip Woodcock.

It was an acquisition that gave Workships a critical insight into the offshore wind industry. Now, two years on, OWS offer clients a range of 10 dedicated wind farm service /crew transfer vessels capable of safe and secure docking with offshore wind turbine generators during construction, commissioning and operation and maintenance periods.

Three vessels are new to the OWS fleet this year; the ‘Offshore Weelinger’ a 12 passenger diamond Damen twin FCS 2610; ‘Offshore Beaver’ a multipurpose / diving support vessel with a 32 pax accommodation capacity, 25t crane, salvage winches and 4-point mooring system; and the Damen 2008 ‘Offshore Waddenzee’, currently working on the Luchterduinen windfarm in the Netherlands.

“It was on stock, and just six weeks after ordering we took delivery. This is Damen’s true strength - big enough to have vessels with a nearly finished construction on stock and with no client.

“We put a lot of work into developing the design to move the balance to client

oriented - the passengers up on the bridge deck giving them a 360 degree horizon to reduce sea sickness, a bigger accommodation space and a large changing area with storage for spare parts. We’ve also put in cabins for the crews so the vessels can work 24 hours.

“Taken together, with this latest fleet enlargement we aim to offer complete O and M solutions to the offshore wind market.”

The advantages of purpose built vessels for offshore wind are clear, says Woodcock: “Boats are designed not to hit things, but these boats hit things every day. On a really busy day we can do 50 landings on the turbines, and that’s a lot of collisions. You’ve got a boat that’s weighing anything from 12 tons up to 100 tons when fully loaded, in the case of our new 2610.

“And you drive this into a big piece of iron in the middle of the sea. So there’s a lot of engineering that makes sure you can do that day in, day out, no matter the weather conditions. Other points to consider are sea keeping performance, and the manoeuvrability needed to get the boat onto a landing.

“We operate just one vessel that is not designed as a wind farm boat, and throughout the industry there are very few wind farm

boats that have been adapted from other industries, simply because it’s quite difficult to do so.

“Some designers are still designing CTVs as they designed their workboats - forgetting that the client is hiring the accommodation and not just the boat.

“On a tug boat for example, a client hires a boat and its tow winch; on a multi-cat the working deck - without caring what’s inside. On a wind farm boat all the passengers are inside; they need the working deck and a pleasant comfortable area in which to transfer.

CLIENT ORIENTED “And when shipyards move into the wind farm industry they can get that horribly wrong; they are giving the orientation too much to the owner and not enough to the client.”

Journey times have clear implications for vessel characteristics and passenger comfort and health, says Woodcock: “For round one and two wind farms in the UK many journeys are less than an hour.

Greater Gabbard 20 miles of the coast at Harwich takes a minimum of 90 minutes because the boats are coming out of

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OWS Lowestoft; for Lynn and Inner Dowsing, two miles off Skegness you are looking at two hours because they are coming out of Grimsby.

“So you need boats that are comfortable, quiet boats and good sea-keeping. And you need boats that are fast - 20 knots versus one doing 25 knots is a significant time saving, though you won’t notice that on a nearshore wind farm.

“And there’s the health issue. The longer the trip the more exposed you become to sea conditions, shock, vibration and noise. Noise and vibration can be very fatiguing, and vibration is not only fatiguing, it’s bad for your health.

“You have to give a ride quality, so when they get to work crews can actually work. There have been cases when men have been landed and unable to work because on the crossing they’ve been totally disorientated.”

Born in Leicestershire and growing up in Western Canada, Woodcock came back to the UK when he was 18. After graduating from the Warsash Maritime Centre, Southampton, he went to sea, became a Master Mariner, and after coming ashore moved into ship management in Miami, Bermuda and Holland, where he became a Director at Workships last year.

“When I started with the company in 2009 my passport was full; I was in Brazil, Thailand, Singapore and Russia continuously. Now it’s Lowestoft, Grimsby and Boston - all the sunny spots on the English Riviera.”

STRATEGIC PARTNERSHIPS Last year Workships Contractors further strengthened its services and presence within the Dutch and German offshore wind markets by establishing a partnership with Frisia Offshore, allowing OWS to expand into Germany, and Frisia Offshore to gain a strong partner outside

the country.

“We spent a lot of time last winter identifying partners we could work with, and who we know that with our name on a contract and with their boat fulfilling it, the client would get the OWS standard of service. These are operators we know personally.

“We are constantly working with shipyards, and at this moment we are developing a new designer vessel in France. Being Dutch, growth is always cautious. At the same time we are always opportunistic. So if an opportunity comes along we take it.”

Meantime OWS and Woodcock are facing up to an alphabet problem. “Since our founding the logo has always had a very distinctive W, and we set about getting a W into the names of our vessels.

So we looked at Dutch sandbanks; Wandelaar, Wielingen, West Hinder and Wenduine are all sandbanks. When we get more new boats we are going to have to start scratching our heads.”

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www.nhmurray.com PAGE 77

End of an era‌

Editorial: Colin Chinery

Back in July, Total World Energy profiled the decommissioning of the Ignalina Nuclear Power Plant in Visaginas in Lithuania. The long process of decommissioning started back in 1999 and on 31 December 2009, the plant completely suspended the production of electricity. INPP Director General, Darius JanuleviÄ?ius tells us more about the progress and challenges of such a monumental process...

PAGE 78

INPP Q: When was the decision taken to decommission the INPP? International community’s opinion was significant for Lithuania during the process of preparation for its accession to the EU and NATO. Therefore, Lithuania respecting the international community’s opinion and having regard to the Nuclear Safety Account Grant Agreement in the approved in Parliament National Energy Strategy in 1999 scheduled the shutdown of Unit 1 of Ignalina NPP by 2005 according to the EU’s, the G-7 counties’, other countries’ and international financial institutions’ long-term substantial financial assistance. In 2000, according to the National Energy Strategy, the Parliament of Lithuania adopted the Law on the Decommissioning of Unit 1 of the State Enterprise Ignalina Nuclear Power Plant.

Lithuania complied with the requirements of the Treaty of Accession to the European Union to shut down Ignalina NPP and the EU committed itself to provide adequate additional financial assistance to the decommissioning. In line with accession to the European Union treaty commitments INPP completely suspended the production of electricity on 31 December 2009 and its activity has been changed from electricity producer to decommissioning organization while maintaining the status of nuclear facility operating enterprise.

Q: What were the main factors that had to be considered?

INPP shutdown was a rather political decision; it is difficult

to specify the main factors that were taken into account during the decision making process, however, it is clear that technical, economic and political factors had to be evaluated i.e. European Union and other countries’ international financial institutions’ long-term substantial financial assistance. The decommissioning program was developed to cover radioactive waste and spent fuel management, dismantling activities, development of relevant legislations, mitigation of social consequences and development of final decommissioning plan, and other decommissioning documents including environmental impact assessment.

Q: What impact has the decision had on the energy industry/nuclear industry in Lithuania?

Since the final closure of Ignalina NPP, Lithuania has become heavily dependent on imported electricity. The greater part of this electricity comes from a single outside supplier - Russia - which is also the source of the gas supply which fuels much domestic electricity production. On the closure of Ignalina NPP Lithuania transformed from an exporter to an importer of electricity and consumer electricity prices rose by nearly 30%.

Q: How long is decommissioning expected to last?

According to the revised Final Decommissioning Plan currently being reviewed by authorities, it is expected that INPP decommissioning process will last until 2038.

Q: How much does decommissioning cost?

An immediate dismantling strategy was chosen as Ignalina NPP decommissioning strategy – this is the way the equipment is dismantled almost immediately after the closure of reactor’s operation in order to avoid serious social, economic, financial and environmental consequences.

The choice of method of decommissioning was influenced by various factors: economic, social, safety aspects and decommissioning work experience at other nuclear power plants.

Today the total cost of INPP decommissioning according to the immediate dismantling strategy is 2 592,6 million Euros (without inflation and risks).

Q: Has a decision been made on the location of an interim storage facility for Ignalina’s spent nuclear fuel?

The existing INPP on-site dry type SNF storage facility that was commissioned in 1999 has been totally filled. The left SNF is still stored in the Unit 2 reactor and storage pools, therefore, INPP is constructing a new Interim Spent Fuel Storage Facility (project B1) that shall cover all needs for interim spent fuel storage.

Q: Following the events at Fukushima in 2011, have safety standards and procedures changed?

While necessary, do increased safety standards cause extra difficulty in a decommissioning project?

Fukushima event had no direct influence on safety standards or INPP decommissioning project.

On 25 March 2011 as a response

© Shell PAGE 79

to events at the Fukushima Daiichi nuclear power plant in Japan, the decision to carry out “Stress Tests” was adopted by the European Council.

“Stress Tests” are additional detailed and transparent risk and safety assessments during which the safety of all nuclear power plants’ in the European Union must be revised. During performance of “Stress Tests” at Ignalina NPP an additional safety assessment has been accomplished for two final shutdown power units and spent nuclear fuel storages which are in operation and under construction respectively, in case of a potential earthquake, flooding, loss of electrical power, loss of ultimate heat sink, accidents or extreme factors. Results of

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the “Stress Tests” report has demonstrated that appropriate measures are provided at INPP to be taken in order to ensure the safe operation of INPP and storage facilities and to protect people and environment from the harmful effects of radiation in the case of incident or emergency at INPP for a variety of adverse factors. According to these results, INPP emergency preparedness plan and severe accident management documentation modifications have been implemented.

Q: What was the purpose of the visit of Alexander Bychkov, Deputy Director General of International Atomic Energy Agency, in April?

Alexander Bychkov, Deputy Director General of International Atomic Energy Agency and Head of the Department of Nuclear Energy visited Ignalina Nuclear Power Plant on 1 April 2014. During the visit he met with the Management of the Enterprise and got familiar with the INPP decommissioning projects.

During the meeting, special attention was paid to the INPP used radioactive waste and spent nuclear fuel handling technologies and in-operation and under construction radioactive waste treatment facilities. INPP specialists introduced Mr Bychkov to the methodologies applied in the enterprise for the reduction of the waste quantities accumulated during the decommissioning and characterization and handling methods applied for waste with complex geometry. Mr Bychkov was also introduced to the world’s unique Project UP01 (Engineering on Dismantling of Units 1 and 2 structures

INPP from the Reactor Shafts) initiated and being implemented by the capacities of INPP in-house employees only. During the visit Mr Bychkov visited the Free Release Measurement Facility (Project B10), Interim Spent Fuel Storage Facility (Project B1) and Solid Waste Management and Storage Facilities (Project B3/4) construction sites where he had a close look at the progress of the projects.

Q: What sort of assistance/help/ guidance has the International Atomic Energy Agency offered since the beginning of the decommissioning project?

Ignalina NPP specialists regularly participate in technical meeting/seminars organized by the International Atomic Energy Agency. They provide a platform for exchange of opinions, best practices and discussions over the issues of decommissioning and radioactive waste management.

There are also several research agreements between IAEA and INPP, for example, “Treatment for Irradiated Graphite to Meet Acceptance Criteria for Waste Disposal”. IAEA assists with broadening the contact between personnel with similar interests and offers scientific consultation and support. INPP does research and as a result receives new information which will be used for radioactive waste management.

Also as a result of Mr Bychkov’s visit – a meeting was held on July 2-3 to clarify the possible cooperation in the characterization of the radioactive waste packages and their disposal in Landfill and NSR (Near Surface Repository).

Owing to technical and operational features, the RBMK reactor presents particular technical challenges for decommissioning, mainly; huge primary masses of buildings, structures and equipment; a large proportion of such masses that are contaminated; large volumes of decommissioning wastes, including long-lived radioactive waste (such as irradiated graphite) for which there is no established disposal method in Lithuania at the moment.

No other RBMK has been dismantled and worldwide there has been no dismantling of any graphite-moderated reactor of equivalent size. Nevertheless, INPP will gather and apply state-of-theart feedback from the already performed and on-going commercial reactor decommissioning projects, as those reactors that exhibit similar technological features as RBMKs.

Q: What economic impact is the decommissioning project having on the local community? Presumably jobs are being created and skills are being developed?

Founded in 1975, Visaginas is a purpose-built satellite town serving the power plant. Its population decreased from 30,000 to 22,000 inhabitants in recent years. Visaginas has been hard hit by the closure of INPP suffering rise in heating prices, the decline in staffing and

prestige of its largest employer and the loss of the original reason for the town’s existence. INPP decommissioning project had impact on economic and social factors of the local community as the shutdown of power plant led to redundancy of employees and bankruptcy of related companies.

In spite of that, INPP had the most powerful reactors in the world, many innovations were developed at INPP that were adopted in other Nuclear Power Plants with RBMK type reactors and Lithuania is the first to decommission the RBMK type reactors under immediate dismantling strategy which makes the INPP decommissioning project a unique world first. The enterprise‘s mission is to discontinue the operation of RBMKtype plant using resources effectively, while maintaining public support for nuclear energy. While implementing the enterprise‘s decommissioning projects, the knowledge and the experience of the personnel is utilised in the most efficient ways possible. Currently the number of employees in INPP has increased slightly due to the intensification of dismantling and decontamination activities. They are given the opportunity to gain new unique experience which they will be able to apply in the future while implementing similar projects.

Q: Does working with RBMK reactors make the decommissioning project more difficult than PWR or magnox reactors?

PAGE 81

Strengthening Czech gas supplies Editorial: Joe Forshaw

Š Photo NET4GAS (Ronald Hilmar,sn.)

As the exclusive operator of gas transmission pipelines in the Czech Republic, NET4GAS is committed to conducting business with a view to ensuring the independent, reliable, and safe operation of the Czech transmission system.

Being an independent transmission system operator, NET4GAS provides gas transmission services to both national and international partners. NET4GAS operates over 3,800 kilometres of high-pressure pipelines, predominantly for the purposes of international transit. CEO, Andreas Rau tells Total World Energy more about development of this important European energy player‌ Q: After the Gazelle Project was completed at the end of 2012, what impact has the pipeline had on the transmission network in the country?

Gazelle is an important part of the new northern supply route for the export of Russian gas into the EU

PAGE 82

via the Baltic Sea (Nord Stream) and

for the Czech Republic, but also for

Germany (OPAL). It establishes a major new supply point in the north of the Czech Republic and connects to the German gas transit system at the south eastern border of the Czech Republic.

Therefore, Gazelle significantly strengthens energy security not only

other European countries. Its annual transmission capacity is approximately 30 bcm/a and thus three to four times higher than the annual consumption of the Czech Republic. In terms of gas flow patterns, Gazelle has led to a situation where the traditional East/

NET4GAS West flow in the Czech Republic is being more and more replaced by North/South and West/East flows.

E.g. the STORK II Project, the BACI project, and the Connection to Oberkappel Project.

Q: Is the Gazelle Project one of the biggest investments that the company has made in recent times?

In line with the political and regulatory targets for diversifying supply routes and sources, as well as establishing an internal, i.e. integrated EU gas market, NET4GAS has been working on additional cross-border pipeline projects for quite a while already. The overall goal is to establish the missing North/South gas corridor in Central and Eastern Europe. The main projects are comprised of the PL-CR Interconnector II (Stork II), the bi-directional AustrianCzech Interconnector (BACI) and the Oberkappel-NET4GAS Interconnector (ONI). All these projects are part of the national, regional and EU-wide 10-Year Network Development Plans and are on the EU list of Projects of Common Interest (PCI) as well. The PL-CR Interconnector II was recently qualified by the European Commission as a priority project in their European Energy Supply Strategy 2014. The total investment need for all these projects exceeds CZK 10 billion.

Yes, indeed. With a total expenditure of nearly CZK 10 billion, this investment is the biggest NET4GAS has made over the last few decades, and it is one of the largest energy investments in the Czech Republic. But it is not the only investment that our company has made in the last couple of years.

We need to mention the Czech-Polish Interconnector (STORK I) built in 2011 or the upgrade of our transmission system in terms of physical reverse flow capacities. The importance of these investments for the security of supply is significant - especially with a view to potential gas transit restrictions via Ukraine in the upcoming winter season.

Q: What plans are being made for the construction of more new pipelines in the country?

Q: Tell us more about other successful projects that have been completed recently and the impact that they will have on the company and the industry?

E.g. Reverse Flow in the WestEast Direction, the Czech-Polish Interconnector (STORK I) and the Connection to the UGS Tvrdonice Storage Facility.

As a result of the Gazelle project and the connection to Nord Stream/ OPAL, shippers have also been offered the possibility of transporting gas volumes across the Czech Republic from northwest to southeast.

NET4GAS has step-by-step removed the technical constraints for this reverse flow. We are now offering considerable physical reverse flow capacities, which are to a large extent already booked by shippers, both on long-term and short-term bases. Due to high market demand, we recently decided to enhance reverse flow capacities at the Czech/Slovak border by another five mcm/d. This project is currently being completed. Another project, which is more for the benefit

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of domestic supplies, is the increase of interconnection capacity to the Tvrdonice gas storage facility owned

by RWE Gas Storage. The respective increase in injection and withdrawal capacity has a major positive impact on the security of energy supply in the Czech Republic. This project was finalised in March 2013.

Q: Does the company hope to make more arrangements with German gas transmission organisations in the future in order to secure additional output and input of natural gas?

Yes. We are in intensive discussions with the German TSOs in order to enhance (physical) entry capacities to the Czech Republic at Waidhaus in the southwest of the Czech Republic and at Brandov in the northwest of the Czech Republic.

Q: Does the company see the future involving more crossborder business, especially with neighbouring nations such as Poland, Austria and Slovakia?

NET4GAS has cross-border interconnections with six neighbouring gas transmission system operators, i.e. four from Germany, one from Slovakia and one from Poland. All interconnections are used for the import of gas to the Czech Republic (with the exception of the Polish pipeline, which is currently only used for exit purposes) as well as transit across the Czech Republic. So what is missing is a large scale bi-directional interconnector with Poland and an interconnector with Austria. We are currently working on both projects. But such projects cannot be implemented without political support, and, for the respective investment decision, we also need sufficient regulatory stability and visibility.

Q: Considering the sensitive political situation in Ukraine,

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what steps has NET4GAS taken to ensure steady supplies in the Czech Republic and the rest of the CEE region?

In the event of any interruption of natural gas supplies to the Czech Republic through Ukraine, NET4GAS is prepared to offer transmission capacities from other entry points in the Czech Republic to all gas suppliers.

We can do this, since we are able to physically reverse flows at short notice and also have the necessary spare transmission capacities available.

As mentioned before, we are also currently further enhancing capacities at the Lanžhot border transfer station for the reverse flow of natural gas in a West-East direction. In addition, NET4GAS has started discussions with the adjacent gas transmission system operators in Germany in order to analyse the short-term possibilities for enhancing physical entry capacities into the Czech Republic. All these measures are intended to mitigate the potential limitations of gas transit through Ukraine in the upcoming winter season.

This is part of our commitment towards reinforcing the energy security not only of the Czech Republic but also of the CEE region as a whole.

Q: Following the company’s announcement of a new financial structure, do end consumers and stakeholders need to worry about rises in prices? How will the new systems impact the business as a whole?

The implementation of the new capital structure aims at replacing the short-term, inflexible, and rather expensive acquisition debt resulting from the change in ownership of NET4GAS by a more efficient and long-term capital structure which comprises an optimum mix of bond and bank financing. This goal has been fully achieved, fortunately at a

time when interest rates have been at a historical low. There will not be any negative impact on end consumers in the Czech Republic. On the contrary, the new capital structure has been designed in a way that we can flexibly react to operational and investment needs. And, of course, the big investment projects like Stork II have also been fully taken into account when setting up the new capital structure. In general, we have worked with very conservative business assumptions when deciding on the capital structure. This includes the assumption that we would practically only rely on those revenues which we have already contractually secured up to the present.

Q: Will the maintenance and upkeep of the new financial structure be down to new CFO Václav Hrach?

Definitely, this is one of the key tasks of the Finance Department headed by our CFO, Václav Hrach.

His team has taken a proactive role in developing and implementing the new capital structure. Now, the main goal is to retain the trust which more than 100 international and Czech investors have put in NET4GAS when they decided to buy our bonds or lend us money in the form of bank loans. For this purpose, we are currently setting up a process for managing investor relations. In addition, Václav Hrach and his team will focus on efficiently and effectively managing all funds to flexibly react to any operating and investment needs.

Q: Has the company seen significant changes in dayto-day operations since its acquisition by the consortium of Allianz Capital Partners and Borealis Infrastructure in 2013?

NET4GAS Since August 2013, NET4GAS has been owned by a consortium of Allianz Capital Partners and Borealis Infrastructure, two strong and very well-reputed financial investors. Their main business is long-term oriented (life insurance and pension schemes), just as the business of NET4GAS is also long-term oriented. Therefore, we consider this the perfect match.

Under our new shareholders, we will continue our market-oriented strategy, i.e. the expansion of cross-border transmission capacities and market integration at the European level. In terms of dayto-day operations, there have not been major changes, but of course reporting requirements are slightly different from the traditional business of vertically-integrated energy companies.

Q: Since taking up your new position in 2013, what progress has been made in the design and implementation of a Central European gas market?

Since I started my mission at NET4GAS at the beginning of December 2013, we have intensified discussions with all adjacent network operators. The main achievement in this regard is that we received a positive decision from the Polish and Czech regulators on our investment request for the Polish/Czech Interconnector Stork II at the end of June.

Here we just have to clarify some open issues related to the regulatory framework and the underlying EU regulation governing such kinds of cross-border projects. In general, we have to keep in mind that the design and implementation of a Central European gas market is a complex and highly political matter

which cannot be achieved within a short period of time. This is a long-term issue where all relevant stakeholders, including regulators, politicians and TSOs, have to closely cooperate.

Q: What is the company’s view that gas may play less of a part in the country’s energy mix in the future because of the ongoing global focus on renewable energies?

In general, the trend towards more renewable energies is positive - as long as it does not lead to inappropriate market distortions and excessive cross-subsidies. We think that gas could be the ideal complementary fuel for renewables, because it can help balance the highly volatile power production from renewables. And, after all, gas is still by far the cleanest fossil fuel

Š Photo NET4GAS (Ronald Hilmar,sn.)

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Turkish renewables providing new opportunities Editorial: Joe Forshaw

Polat Enerji was established in 2000 to engage in electricity generation, distribution and trading activities. A decision was taken to invest in energy sector due to the Turkey’s growth targets and plans of becoming one of the world’s major economic power. The company operates some of the country’s largest renewable energy projects and is hoping to encourage further investment in this lucrative sector.

CEO, Zeki Eriş tells us more…

Q: Explain more about the company’s history?

Polat Enerji was established in 2000 and has grown to become a major player in the renewable energy market. Polat Enerji’s key targets are to invest in renewable energy resources, reduce carbon emissions, and create a balanced energy mix for sustainable development.

The capacity of the eight licensed

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projects is up to 600 MW. The total investment cost of these projects is over $1 billion. When all the wind power plants (WPPs) are taken under operation, approximately 2 billion kWh of electricity will be produced per year, yielding a 1.2 million ton CO2 emission reduction annually. EDF-EN has been a shareholder of Polat Enerji since 2008. PSP Investments has been also a shareholder of Polat Enerji in early

2014.

For years, as an active player in the energy sector, Polat Enerji is working for sectorial reforms and developments.

Q: Tell us more about progress at the Geycek wind farm?

Following commissioning in May 2014, is the operation running smoothly?

Polat Enerji’s latest operational wind

Polat Enerji farm, Geycek, started generating electricity in September 2013 and it was fully operational in April 2014 with the last commissioning. The project consists of 70 Enercon turbines with a total power generation capacity of 150 MW, which makes it the Turkey’s largest onshore wind farm.

The project contributes to reduce directly the greenhouse gas emissions for an estimated 231,000 tCO2.

Geycek generates 384 million kWh of electricity per year and meets the annual need of 191,500 people/ households, ensuring it plays an important role to create a renewable energy future.

Q: What is the relationship like between Polat Enerji and EDF Energies Nouvelles on the management of Geycek wind farm?

Al-Yel Elektrik Üretim A.Ş. is the project owner company that belongs to Polat Enerji Sanayi ve Ticaret A.Ş. EDF EN is the shareholder of Polat Enerji.

Q: Do you think the nation’s target of 20,000MW installed wind capacity by 2023 is realistic and achievable?

Turkey has set an ambitious target to become one of the 10 largest economies in the world by 2023, the centenary of the foundation of the Turkish Republic. According to the Electricity Energy Market and Supply Security Strategy Paper issued by the Ministry of Energy, in 2023 the share of renewable energy sources in electricity generation should be at least 30%.

Regarding wind power, the target is to increase installed capacity 20,000 MW. Giving priority to domestic sources is an important part of reducing dependency on imported energy sources. The main objectives and principles are creating a competitive market, taking into consideration climate change and environmental impacts, increasing efficiency, reducing electricity energy costs by building a competitive environment based on resource priorities, increasing the share

of domestic contribution and ensuring diversity of resources, and maximizing the use of domestic and renewable resources in order to reduce external energy supply dependency.

Turkey’s installed wind power capacity is about 3,500 MW as of August 2014. To reach the 20,000 MW target by 2023, 16,500 MW wind power capacity should be taken under operation in eight years. Therefore, the target does not seem to be realistic with these conditions.

Q: What is the company planning for the future? Will we see the development of more wind farms from Polat Enerji in the near future?

Renewable energies are a crucial part of the policy mix we need. They make a significant contribution to the global fight against climate change, reducing harmful emissions in a way which is economically feasible and beneficial and create new jobs In light of these facts we plan to complete the ongoing projects

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Zeki Eris

on schedule by following a responsible path to sustainable development. Also we are starting to develop new wind farm and solar projects and evaluating opportunities for other renewable energy sources. By investing in renewable energy sources Turkey reduces its energy dependency by enhancing the security of energy supply and also secures a better world for our future generations by providing them with a fully-amortized, clean, and cheap generation.

We will continue to work for our country and future.

Q: What are the main challenges involved in the 100MW capacity increase at the Soma Wind Farm?

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Construction of the 100 MW capacity increase project was started in April. Soma will be the biggest operational wind farm in Turkey with 240.1 MW installed capacity when the wind farm is taken under operation in mid-2015.

The Soma capacity increase project will be easier than the existing project because road constructions, administrative building and all the rest of the necessary structures will already have been made.

Q: How would you position yourself in the market compared to your competition?

Polat Enerji is market leader with recognised expertise in the Turkish wind energy sector. EDF-EN develops,

installs, and operates green electricity power plants, mainly in Europe and North America, and primarily for its own owner-operator account and for third parties. The company has 7,190 MW of gross installed capacity, 6,249 MW of installed power in wind energy, and 705 MW of installed power in solar energy. Also, gross capacity under construction is 2,320 MW. Annual revenues of the company are up to ₏1.5 billion. PSP Investments is one of Canada’s largest pension investment managers, with $93.7 billion of assets under management.

These figures, experience and know-how show how strong these partnerships are. We believe that we are strong enough to remain as the market leader in Turkey.

Polat Enerji Q: What is the general attitude towards renewables like in Turkey? Are the public supportive of wind farms and other renewable projects?

The public attitudes toward wind farms are positive in Turkey. The public support for wind power is very high and people are willing to pay more for wind energy.

Also, wind farms may benefit the local rural economy especially when the economy was previously supported by one industry, such as agriculture. Wind energy is creating new jobs, providing employment opportunities for local people. The companies have funded many projects to advance societal quality of life where the wind farms operate.

Q: Would the company consider working on offshore wind farms?

Turkey has huge potential for renewable energies. In terms of wind potential, Turkey’s offshore wind potential is around 10 GW. But Turkey does not yet have any offshore wind projects. Maybe Polat Enerji will be the first.

Q: What is your personal history with the company and with the industry?

I have more than 20 years’ experience in Turkish energy sector.

Between 1991 and 1998 I worked in different positions for mining projects. At the end of 1998, I became a member of Polat Group as the Managing Director and Member of Board of Directors of Polat Enerji and started to develop Renewable Energy Projects and continue to do so.

I am a member of Turkish Industrialists’ and Businessmen’s

Association and Vice Chairman in charge of Renewable Energy in TUSIAD’s Energy Working Group.

I am also a Member of the Energy Council of The Union of Chambers and Commodity Exchanges of Turkey, Member of Executive Committee of Electricity Producers Association and founder of the Turkish Association of Investors of Wind Farms.

Q: Tell us more about the company’s workforce? Is it made up mainly of Turkish engineers or do you have to import international labour?

Our company’s workforce is made up of 170 people that are carefully selected, ambitious, energetic and young people. The local employment opportunities that we create represent a key part of our economic contribution to the Turkey

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Foto HMC - Michael Zapf

The wind industry procures a stiff breeze Editorial: Joe Forshaw

From the 23rd to the 26th of September, Wind Energy Hamburg - the global onshore & offshore expo - became the meeting place for global experts.

The imposing 64.4 meter long rotor blade, reflected for four days on the glass facade of the Hamburg exhibition halls, showed trade visitors the way to the latest innovations in wind energy.

Outside, a typical Hamburg ‘stiff breeze’ was blowing; inside, the leading international trade fair Wind Energy Hamburg, celebrated its successful premiere. From the 23rd to the 26th of September, Wind Energy Hamburg was the meeting place for professionals

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in the energy industry from around the world and offered this global industry an optimal platform for dialogue, and to showcase their new products, innovative technologies and services.

“Wind Energy Hamburg is focused completely on the wind industry and covers the entire value chain, onshore as well as offshore,” said Bernd Aufderheide, President and CEO of Hamburg Messe, when discussing the special advantages of Wind Energy

Hamburg. International trade visitors could gain information over the entire range of products and services - from a large wind turbine to the fasteners holding it together; from the offshore installation vessel to industrial divers; from software for wind instruments to modern tools for 3D underwater monitoring; from the community wind farm developer to large energy utilities.

More than 1,200 exhibitors from over 30 countries presented at this

Wind Energy Hamburg premiere covering over 65,000 square meters in all eight halls. In 18 national pavilions, industry companies from different countries attended the event.

The wind metropolis Hamburg, where many global players in the industry have their headquarters, turned out to be the perfect setting for the largest wind energy fair in the world.

Thus, Aufderheide sees in the global orientation of Wind Energy Hamburg, an important feature of this new international trade fair: “Many of the exhibiting companies are already global players who are active worldwide in many countries; a good example for this is the major manufacturers whose turbines rotate, depending on the company, in up to 70 countries.”

COST EFFICIENCY AS AN IMPORTANT SUCCESS FACTOR Since cost efficiency is an important success factor for wind energy, new technologies and solutions to optimise existing systems and processes are in demand. Many exhibitors presented their products and ideas in Hamburg

on innovations for inexpensive higher yield from low wind to difficult climatic sites ashore. This also applies to inexpensive floating turbines, foundations for offshore installations, as well as facilities for the maintenance and monitorisation of wind turbines, such as the use of camera drones. Also exhibiting, just for the offshore area, were some companies with interesting synergies with the maritime industry; around 100 companies from this sector also exhibited at Wind Energy Hamburg. Only two weeks earlier some had presented at the world’s leading maritime industry exhibition, SMM, and could immediately reuse their stands.

A large number of trade visitors, including members of the economic and political delegations from 20 countries, were convinced of the tremendous innovative force displayed by the industry across the Hamburg fair site. Economy Minister for Foreign Affairs and Vice Chancellor of Germany, Sigmar Gabriel, also responsible for the German energy transition, was impressed when he opened the fair on the evening before the event, stating

that: “Wind energy has established itself worldwide, both from an economic and from an energy policy perspective,” the German Vice-Chancellor went on further to say; “this is a great success and at the very least is a result of brilliant development work over the past 20 years, especially in Germany.”

Central themes of the exhibition were the effects of energy transition on leading technologies in Germany and the particularly important role of wind energy in its implementation.

“Even beyond this, the industry has shown that its new leading trade fair contributes to current and future technical developments with innovative solutions for a sustainable energy supply,” said Bernd Aufderheide. “This is of great interest to every country and, Wind Energy Hamburg, has further established itself worldwide in its first foray as the forum for important growth impulses in the industry.”

In the strength of the German wind industry Steve Sawyer, Secretary General of the Global Wind Energy Council (GWEC), sees a responsibility for the global energy market stating:

Foto HMC - Hartmut Zielke

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HMC - H.G. Esch, Ingenhoven Architects

Wind Energy Hamburg “The German energy transition is a great inspiration to many countries around the world,” during his visit to Hamburg. Sawyer further appealed to the German Vice-Chancellor: “Germany must not only lead as a technology country, but also must throw its weight as a political leader behind the EU to globally keep wind energy in focus.”

He further said directly to Gabriel: “It is fundamentally important that you will spend time on this.”

INTERNATIONAL CONTACT INFORMATION USED The comprehensive range of information and international contact information for the trade fair was happily adopted by lively groups of visitors from around the world. Delegations came from both established as well as emerging markets in the wind industry such as the US, China, Japan, India and Turkey to the leading trade fair in Hamburg. There was particular interest from South and Central America with delegations from seven countries across the region.

As part of Wind Energy Hamburg, H2Expo was co-located on the grounds of the Hamburg Fair, and

exhibited solutions for storage and mobility, which are of importance in the integration of renewables in the energy market. Through the synergies with the wind energy industry there were also, for visitors to the trade fair, numerous information and networking opportunities. Alone, the storage of wind power was an important topic at Wind Energy Hamburg, since it is a major challenge for energy transition.

The exhibition was complemented by a varied program consisting of forums, conferences and workshops. The last day of the wind energy fair was also devoted to the growing labor market.

‘Recruiting Day’ informed recruiters and numerous exhibitors about job opportunities, career planning as well as training opportunities in the wind industry.

Bernd Aufderheide was more than satisfied with the very successful premiere of the new exhibition in Hamburg particularly because it was so very well received by the industry. “We are very excited about this great interest,” said the CEO. “It clearly shows that the industry has become actively involved in this new global meeting point and discussion

platform.” Innovations could not only be experienced but also enjoyed in Hamburg. Aufderheide went on to say about the event: “Not only the huge rotor blade in front of the entrance to the fair was considered impressive.”

ALL INFORMATION ON WIND ENERGY HAMBURG The next Wind Energy Hamburg - the global onshore & offshore expo - will take place from 27th to 30th September, 2016. Hamburg Messe is located right in the heart of Germany’s second largest metropolis. Information can be found at www.windenergyhamburg.com.

The leading international trade fair for the onshore and offshore wind industry is held every two years at the Hamburg Fair site. From 15th to 18th September 2015, the wind fair in Husum will also take place with a focus on the national market. The Husum Wind event also takes place every two years. Its location in the wind pioneer country of the German North Sea coast enhances this fair’s traditional meeting place with an intensive exchange of industry and creates practical added value

Foto HMC - Hartmut Zielke

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Manage time and energy will follow…

Editorial: Christian Jordan

There is no time for errors in the energy industry. You have to know how long things take, how long people take, how much time equals how much energy; and do all of this you need a strong watch.

What does a professional diver and submariner have in common? They both work underwater? Yes; they both are highly skilled? Usually; they both have strict deadlines? Definitely; but how could you compare them in terms of fashion? Well, a diver will typically wear a wet suit whereas a submariner might dress in a navy uniform. A diver might weld the subsea parts of an oil rig and a submariner might provide research services during oil exploration. But while there are many differences between the two types of people, there are also many similarities and one of these is that they will both

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wear a quality watch; after all, you can’t afford to make mistakes when you operate with a limited supply of oxygen.

So what are the best watches for the energy industry professional?

What would be functional, fashionable and well-timed? What is solid, dependable, good looking and designed specifically for the challenges faced everyday by the hands-on energy worker? Well, there are really only four choices and while their cheaper counterparts might keep time just as well, they certainly won’t attract the same attention as our four impressive recommendations.

Rolex Deepsea The Rolex Deepsea is again a watch for the mariner and has been developed specially to commemorate James Cameron’s historic solo dive where the Canadian film director piloted Deepsea Challenger to the deepest known point on Earth. Deepsea Challenger was secretly built in Australia, in partnership with the National Geographic Society and with support from Rolex. The watch itself features a special blue glow in the dark, lasting twice as long as standard luminescence materials; perfect for operations in the dark reaches of the ocean. But at £4000 would you wear it in the sea?

Gadget Box

Breitling Superocean 44 The Breitling Superocean 44 is the perfect choice for the subsea worker because of its extremely good competencies beneath the surface.

It can reach depths of up to 2,000 m (6,600 ft) without any issues. The case is slightly larger than other Breitling models and comes equipped with a safety valve to to balance out differences in pressure inside and outside the case. Coming in steel or steel and gold, the case is part of the beauty of this watch and if you’re flashy, Breitling also offers bezels with an 18K rose gold ring. However, I’m not sure I would consider subsea diving with a £3000 watch on my wrist.

Omega Planet Ocean 600 M Omega was the first watch maker to promote a timepiece specifically designed for divers. Back in 1932, the company presented the Marine and since then has been one of the world’s leaders in water resistant watches. The Seamaster range was released back in 1948 and

because of its reliability, it has been the choice of sailors and divers for years. The Planet Ocean 600 M is resistant to 600 meters and is powered by the Omega Co-Axial calibre 9300 which can be seen through the transparent caseback.

Like the others, it also features a helium escape valve and at £5000 you would expect so too.

but the drawback of this one is the £150,000+ price tag. It has polarising looks and if you did own it, I’m not sure you’d want to wear it on a rig but its big enough that you certainly wouldn’t lose it

Royal Oak Offshore Selfwinding Tourbillon Chronograph The Royal Oak Offshore Selfwinding Tourbillon Chronograph comes from luxury Swiss watch maker, Audemars Piguet. This company makes watches for Tiffany & Co, Cartier and Bulgari so you know you’re getting high-fashion.

The case is unique coming in forged carbon with a glareproofed sapphire crystal caseback. It’s packed with 34 jewels and is made from over 330 small parts. It’s water resistant to 100 meters and the finishing and detailing is beyond the capabilities of most watch makers

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The world’s first 4WD plug-in hybrid SUV Editorial: Joe Forshaw

The Mitsubishi Outlander PHEV is a technologically advanced series parallel hybrid which is a vehicle that can use either an electric motor or an internal combustion engine to power the wheels. It has turned heads because of its title of being the world’s first 4WD plug-in hybrid SUV but does this mean more auto manufacturers will go down the hybrid/electric road?

We continue our focus on alternatively powered transportation this month with a look at a vehicle that is currently making critics step back and reconsider their opinions of electric and hybrid cars.

The BMW i8 and i3 and the Tesla Model S are hybrid and electric cars that have bought the idea into the mainstream for many people and

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although Toyota, Nissan, Renault, Honda and a number of other big name automotive brands have been working on the idea of alternative power for some time, on the whole it seems that the traditional combustion engine will take some beating and is not ready to lay down and be overtaken by new ideas just yet.

To date, electric and hybrid vehicles have predominantly been hatchback in style; smaller to maintain efficiency (think of the Toyota Prius, the Nissan Leaf and the Mitsubishi iMIEV) but recently Mitsubishi, one of the world’s most renowned energy companies released its new offering, the Outlander PHEV and what is

Gadget Box

crucially different here is that the Outlander PHEV is a 4x4.

The Outlander PHEV, or Plug-in Hybrid Electric Vehicle, is powered by a 2.0 litre petrol engine combined with a full time four-wheel drive twin motor system, made up of two 80bhp electric motors.

Starting at £28,249 and peaking at £34,999, the Outlander PHEV has many add-ons that are standard in any vehicle sales these days. You’ll pay more for in car technology

such as screens for the back seats, charging accessories, tow-bars and other external protection and styling.

Importantly, Mitsubishi claim that this vehicle is successful because it handles the basics very well (capable of more than 30 miles and over 60 MPH on EV power) while also providing the space and performance that you would expect from a SUV. The Outlander PHEV also charges itself using

regenerative braking or can be plugged in to an EV charging unit for maximum efficiency. But the most important statistic, claims the company, is the cars ability to return 148mpg.

It also boasts a five-star Euro NCAP rating so the difference in power supply makes no difference to Mitsubishi’s unrelenting focus on safety.

The company is undoubtedly pleased with the response that the

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car has received so far since its release and has showed this with a massive advertising spend here in the UK, eclipsing the costs allocated to this market in previous years (£6million in 2012, £8million in 2013, £20million in 2014) and getting Mitsubishi adverts back on TV to shout about the Outlander PHEV. Interestingly, the interior of the Outlander PHEV is surprisingly normal. The i3 and the Tesla make sure you know you’re in something different, you know you’re inside an ‘innovation’ but with the Mitsubishi, the interior is almost the same as the previous Outlander models (both of which had standard combustion engines) and that is the intention.

The one stand out piece from inside is the central display, a visual control system that allows you to see and control hybrid operations, multimedia and other bits; you can also download an app and hook your smartphone up to the car, allowing for control various

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functions, such as managing its charging or firing up the climate control – a nice touch for the gadget-minded driver.

When charging, a sticking point for some electric vehicles, the Mitsubishi is fine in all weather, it takes approximately five hours for a full charge from a 13A domestic socket, and can be charged with A/C or rapid D/C connectors – however, repeatedly performing only rapid charging may reduce the battery capacity.

Another impressive factor is the fact that the electric engine can be turned off and the power stored in the batteries for later use – particularly handy for commuters who travel a long way, ending up in a low-emissions zone. Also, the switch between petrol and electric engine is seamless and this is one of the things that has impressed the critics.

So onto the most important of statistics – emissions. At just over

£28k for the entry-level GX3h, you’ll be emitting just 44g/km of CO2, qualifying for BIK company car tax at just five per cent – a good start.

And with the added gadgets that you get as standard that aren’t featured in the alternatives (reversing camera, DAB tuner, sat-nav and powered tailgate), the Outlander PHEV is a perfect choice for a company fleet. It’s just as usable as the standard Outlander (even offroad) and just as cheap to buy and potentially a great deal cheaper to own, meaning it passes most tests for use-ability and affordability.

Ultimately, this is probably not the car that will change the world and get everyone into electric vehicles but it has taken the best of what is available and made probably one of the best hybrid cars on the market today and this sort of energy solution is always welcome, at least until a 100% emission free, 100% functional vehicle hits the market in the near future.

Gadget Box

Tenglee Marine & Engineering Pte Ltd (TL) was established in 1993; together with Yong Cheong Marine & Engineering Pte Ltd, Yong Ming Marine & Engineering Pte Ltd and Hong Yat Steelwork & Engineering Pte Ltd, it combines its resources to cater for shipbuilding, marine repairs and specialised engineering works for the marine & offshore industry in Singapore. TL is recognised as one of the most reliable and competent steel hull fabricators in Singapore and has been granted resident contractor status by the Keppel Group of Shipyards (Keppel Singmarine, Keppel O &M and Keppel FELS) and PRM Offshore Heavy Industries.

Since its establishment 20 years ago, TL has taken an active role in the oil & gas industry, constructing more than 18 supply vessels, taking part in 7 jackup-rigs and even Southeast Asia’s first construction of an icebreaker for Lukoil between 2006-2008. With its team of highly trained personnel, TL has maintained its reputation of delivering top quality vessels as well as always on time.

In 2012, TL also set up operations in Baku, Azerbaijan in support of the oil exploration activities of SOCAR (the national oil Company of Azerbaijan). It is now currently building several marine offshore vessels in Baku, including a semi-submersible and an upcoming subsea vessel for pipe-laying.

Apart from Azerbaijan, TL has broken into the Brunei market with its local partner ZHMD Engineering Services SDN BHD in 2013. Together, we have been granted the rights to tender for all Brunei Shell Petroleum contracts and our foremost goal is to set up a shipyard locally. TL also intends to expand into Mexico and Brazil, notwithstanding our invitation to partake in the China market in Nan Tong.

Contact: Director – Ray Teng 994 502 789 278 ray.teng@tengleemarine.com

Teng Soon Kiat Founder

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