Oil & gas middle east january 2017 by Phuong Nguyen

SPECIAL REPORT: BIG DATA HELPS OPERATORS IMPROVE EFFICIENCY

NEWS, DATA AND ANALYSIS FOR R THE THE MIDDLE MIDDLE EAST’S EAST’S ENERGY ENERGY P PROFESSIONALS ROFESSIONALS In Numbers

January 2017 • Vol. 13 • Issue 01

Wellheads & equipment

GCC companies are riding the wave of digitalisation / p8

Efﬁcient wellheads are key to cutting costs and optimising production / p28

Life LESSONS

Country Focus The Sultanate of Oman’s energy sector analysed / p43

Cyberhawk’s Chris Fleming shares his career’s highlights/ p20

FLUOR INTERVIEW

Regulars:

CONSTRUCTION WEEK SPEAKS TO FLUOR’S MARC HEERINK /P48

/ NEWS / COMMENT / FEATURES / PRODUCTS / PEOPLE / PROJECTS

THE APP • DO OAD W NL

THE APP • DO W OAD L N

THE APP • DO OAD W NL

INTERVIEW

Benoît Labre, the regional managing director of Flexitallic, elaborates on how innovation helps the century-old company provide effective sealing gaskets to the oil and gas industry

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CONTENTS

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ON THE COVER

22 JANUARY 2017 / Volume 13 Issue 01

Highlights in this issue:

Interview: Benoit Labre

Wellheads and equipment

Special Report: Big Data

Flexitallic is consolidating its position as a leading provider of gaskets in the oil and gas industry by offering innovative products and spreading its wings both regionally and globally.

Key to controlling asset performance and production, maximising the efﬁciency of wellheads and equipment while reducing risks and costs has been at the forefront of the sector.

We delve into how Big Data is helping regional oil and gas companies achieve operational excellence, along with presenting a lucrative opportunity for ICT companies to explore.

COUNTRY FOCUS: arabianoilandgas.com

Continuous innovation, from pore to pipeline. In 1927, Conrad and Marcel Schlumberger used their new electrical well logging technique to identify formations in the Pechelbronn oil ﬁeld in the Alsace region of France—a ﬁrst in the oil and gas industry. Tod T ay Schlumberger continues to innovate by introducing pioneering technologies delivered with technical expertise gained from decades of experience.

slb.com

Oman hopes for a better new year to drive its energy industry to proﬁtability / P43 JANUARY 2017

CONTENTS

Also inside:

Marc Heerink says Fluor’s experience on mega plants will maintain its market share.

06 / Editor’s Letter O&GME’s deputy editor, Indrajit Sen, shares his views.

52 / Products

08 / In numbers The GCC is embracing the potentials of digitalisation.

10 / News updates

This month’s products and services in the spotlight.

56 / People

This month’s appointments and promotions news.

The latest news in the regional and global oil and gas sector.

60 / Project Focus

12 / Around the GCC

The latest developments in major regional projects.

A round-up of the latest news in the regional oil and gas sector.

62 / Project Listings

16/ Comment Alasdair Buchanan on the subject of low carbon emissions.

A run-down of the biggest oil and gas projects in the GCC.

66 / Five Minutes With...

18/ Comment

Featuring Dick McAdam, VP of SPX Flow Middle East.

EPC experts discuss the state of affairs in the energy industry.

20/ Life Lessons

Online

Chris Fleming, CEO of Cyberhawk, narrates his journey into the world of UAVs.

22 / Cover interview Flexitallic consolidates its position as a leading provider of gaskets by offering innovative products.

KEEP UP-TO-DATE

For all the latest news, check out www.arabianoil andgas.com

Editor’s choice:

www.arabianoilandgas.com • Refining & Petrochemicals Middle East Power 50 • Galleries: Looking back at the Oil & Gas ME Awards 2016 • Photo gallery: Fabricating in local waters

28 / Wellheads & equipment Maximising the efﬁciency of wellheads has become a core issue.

33 / Special Report: Big Data Analysis of how Big Data aids in optimising upstream operations.

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DOWNLOAD IT TODAY ON YOUR IPAD, ANDROID OR KINDLE

43 / Country Focus: Oman Invigorated by the oil producers’ output cut deal, Oman looks forward to a better year ahead. JANUARY 2017

48 / CW Fluor interview

66 arabianoilandgas.com

EDITOR’S LETTER

The year 2017 we’ve all been yearning for With the landmark deal between OPEC and non-OPEC producers boosting oil prices, optimism has been rekindled

rdent critics of OPEC, particularly Saudi Arabia, have either been silenced or coerced to alter their opinion. In the first such deal since 2001, the cartel made peace THIS ISSUE: with a group of 11 other key oil Efficient wellheads producers, led by Russia, to reand equipment play duce production in a bid to prop a key role in helping upstream operators up crude oil prices. optimise producAs Dr. Faisal Mirza, an tion. Read our story ex-Aramco employee and an on the topic (p28). industry expert, points out, “Since the failed Doha meeting last April, Gulf ministers insisted that any return to production cuts must include concerted action by OPEC and non-OPEC producers. Eventually, they came to an agreement after massive efforts of diplomacy and fulfilled that condition.” It is interesting to note, however, that while Iran was an active participant in the negotiations and has agreed to adhere to the deal, the United States continued to shun any efforts oil producers make to balance the market. Nonetheless, the Vienna agreement gives the global industry a few reasons to rejoice. First, it firmly establishes the fact that it wasn’t and is not in OPEC’s interest’s to bully the world’s oil markets to drive other producers out. Had it been so, it would have never taken the initiative to reach out to those very same players whom it has been supposedly battling with since December 2014. Second, by virtue of the deal, Saudi Arabia and Russia consolidate their positions as responsible leaders/influencers of the global oil market. After

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championing this agreement, observers can’t help but be convinced that the market is in the hands of good and able leaders now. Lastly, and more importantly, oil prices have received the necessary impetus to rise to a realistic level – the $60-70 per barrel range – which will hopefully breathe new life into the upstream sector, and at the same time not make the industry undesirably comfortable (as in the pre-2015 period). Desperately required investments and capital expenditure will hopefully be made during the course of the year, which will presumably lead to an overall development of the entire industry, including the contractors and products and services providers. I travelled to Ras Al Khaimah last month to meet the regional managing director of Flexitallic, one such active product supplier to the industry. A detailed interaction with the executive and a tour of the company’s busy manufacturing unit makes me feel the industry’s wheel is beginning to move again. To new beginnings then! Indrajit Sen Deputy Editor, Oil & Gas Middle East indrajit.sen@itp.com

Oil prices fluctuations for the past 10 years showed that speculators caused steeper fluctuations than OPEC Steep fluctuation caused by speculation activities

140

120

100

Less steeper 100 fluctuations caused by OPEC weighed 80 policy

80 60

20 2006

20 2008

2010

2012

2014

2016

To subscribe to Oil & Gas Middle East, or other ITP Business titles, go to: www.itp.com/subscriptions.

PO Box 500024, Dubai, UAE Tel: 00 971 4 444 3000 Offices in Abu Dhabi, Dubai & London ITP Media Group CEO: Ali Akawi Executive Director: Matthew Southwell Group Editorial Director: Greg Wilson Group Publishing Director: Ian Stokes Editorial Editorial Director: Robert Willock Tel: +971 4444 3357 email: robert.willock@itp.com Deputy Editor: Indrajit Sen Tel: +971 4444 3264 email: indrajit.sen@itp.com Senior Reporter: Yasmin Helal Tel: +971 4444 3659 email: yasmin.helal@itp.com Advertising Sales Manager: Ahmed Ahmed email: ahmed.ahmed@itp.com Online Advertising Advertising Director: Riad Raad Tel: +971 4 444 3319, email: riad.raad@itp.com Sales Manager: Jill D’silva Tel: +9714 4443352 email: jill.dsilva@itp.com ITP Live General Manager: Ahmad Bashour Tel: +971 4 444 3549 email: ahmad.bashour@itp.com Studio Head of Design: Genaro Santos Photography Director of Photography: Patrick Littlejohn Senior Photographers: Rajesh Raghav, Efraim Evidor, Richard Hall, Ethan Mann Staff Photographers: Lester Apuntar, Aasiya Jagadeesh, Ausra Osipaviciute, Grace Guino, Fritz Asuro, Sharon Haridas, Ajith Narendra Production & Distribution Group Production & Distribution Director: Kyle Smith Production Manager: Basel Al Kassem Outsource Manager: Aamar Shawwa Production Coordinator: Mahendra Pawar Senior Image Editor: Emmalyn Robles Distribution Executive: Nada Al Alami Circulation Director of Conferences, Circulation & Data: Michael McGill Senior Circulation Manager: Manoj Chaudhary Circulation Executive: Loreta Regencia Marketing Director of Awards & Marketing: Daniel Fewtrell Events Manager: Natasha Bhatia Marketing Manager: Dominic Clerici ITP Group Chairman: Andrew Neil Managing Director: Robert Serafin CFO: Toby Jay Spencer-Davies Board of Directors: Ali Akawi, Walid Akawi, Mary Serafin The publishers regret that they cannot accept liability for error or omissions contained in this publication, however caused. The opinions and views contained in this publication are not necessarily those of the publishers. Readers are advised to seek specialist advice before acting on information contained in this publication which is provided for general use and may not be appropriate for the reader’s particular circumstances. The ownership of trademarks is acknowledged. No part of this publication or any part of the contents thereof may be reproduced, stored in a retrieval system or transmitted in any form without the permission of the publishers in writing. An exemption is hereby granted for extracts used for the purpose of fair review.

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IN NUMBERS

Digitalised future for the GCC

Joint study by Siemens and Strategy& ﬁnds the GCC is well-placed to embrace the disruptive potential of digitalisation

A 8

joint study conducted by Siemens and the management consultancy Strategy& launched the ‘Preparing for the digital era: the state of digitalisation in GCC businesses’ report at Dubai’s 3D-printed Office of the Future, highlighting key findings that are intended to help encourage the progress and evolution of digitalisation among the region’s businesses. Of the 300 companies surveyed, 60% believe that digitalisation has the potential to create new business models or lead to a more open culture of innovation. However, only 3% of organisations believe they are at an advanced stage of their digital transformation process, with only 18% using the cloud and 30% using big data and analytics specifically. The study also found that companies in the GCC are lagging behind their government and consumer counterparts when it comes to using digital technologies. For example, GCC governments have acknowledged the economic and social benefits of digitalisation, incorporating them into their ambitious strategies. Saudi Arabia’s Vision 2030 and National Transformation Plan 2020, Smart Dubai, Qatar’s Connect 2020 ICT Policy, and Oman’s digital strategy e-Oman all stress the importance of the use of digital technologies. Even though many organisations are gradually building technology capabilities, some lack the vision and the necessary leadership to drive their digital transformation. Taking practical steps forward can often be beset by internal obstacles. For example, 40% of companies in the region have allocated less than 5% of their total investments to digitalisation activities. Only 37% of companies have a strategy for going digital, and less than 1% of companies have a chief digital officer. JANUARY 2017

46% are familiar with digitalisation

23%

H AV E A P R O P E R U N D E R S TA N D I N G O F D I G I TA L I S AT I O N

77%

A S S O C I AT E D I G I TA L I S AT I O N WITH ONE T EC H N O LO GY

Bodies responsible for digitalisation

45% 33% 15% 6% 1%

HIGHER MANAGEMENT

IT DEPARTMENT

DEDICATED COMMITTEE

DECENTRALISED

CDO/ CIO

Top 3 technologies

33% I N T E R N ET OF THINGS

43% S O F T WA R E AND APPS

30% BIG DATA

arabianoilandgas.com

IN NUMBERS

Change in spend on digital compared to past year

62%

32%

INCREASED SPENDING

37% 37% %

S TAY E D THE SAME

have a digital strategy

REDUCED SPENDING

Availability of digital skills 48%

47%

CREATIVE STRATEGY AND DESIGN

DATA ANALYTICS

01 02 03 04

46%

EVALUATING EMERGING TECHNOLOGY

TECHNOLOGY ARCHITECTURE AND DESIGN

Strategy: Articulate corporate strategy for the digital age accounting for developments that impact the industry and company aspirations within the industry

Strategy

Focus areas: Determine digital focus areas, priorities in the organisation where digital can add the most value

Digitalisation engine: Create an engine for driving digitalisation by establishing the right leadership and governance structure that fosters collaboration and agility

39%

USER EXPERIENCE

PROTOTYPING

Digital transformation building blocks

Focus areas

Digitalisation engine

Skills: Build digital skills across the organisation especially in focus areas

Skills

Partnerships

Investments

arabianoilandgas.com

32%

Partnerships: Collaborate with stakeholders across the ecosystem and embrace open innovation

05 06

Investments: Invest in digital by developing an approach that accounts for riskiness of investment

JANUARY 2017

NEWS

Coming up: /11 /12 /12 /14 /15

OPEC/non-OPEC members enter “historic” agreement Oil cartel persuades group of 11 oil producers, led by Russia, to reduce production by 558,000 barrels per day – short of the 600,000 bpd the former had hoped for. Deal effective from January and renewable after six months

OPEC/NON-OPEC AGREEMENT

Non-members will cut 558,000 bpd, while OPEC members will reduce output by 1.2mn bpd.

fter two meetings in Vienna, OPEC managed to persuade 11 non-members to cut oil production, a move aimed at draining a worldwide oil glut, and boosting low prices that have squeezed government ﬁnances in Russia and Saudi Arabia. Ofﬁcials said that non-members agreed to cut 558,000 bpd (barrels per day) for six months starting from 1 January, 2017, and that the deal was renewable for another six months post that.

QUOTE: JANUARY 2017

The ﬁgure was less than the 600,000 bpd that OPEC had hoped for. Those non-member cuts come on top of an OPEC decision on 30 November, 2016, to reduce member output by 1.2mn bpd. Saudi oil minister, Khalid Al-Falih, called the deal “historic” and said it would stabilise the market through next year and encourage industry investment. “It’s an unprecedented move that will be followed by a high level of

BP & CEFC win ADCO stake News from around the GCC Neutral Zone may restart RasGas & Qatargas to merge Iran strikes deals with IOCs

compliance, and we will see that reﬂected on the supply-demand balance in 2017 and on the glut in the market,” he told reporters. The announcement came after OPEC member states met with Russia and other non-OPEC countries in Vienna for talks. The 11 non-OPEC countries taking part in the agreement include Azerbaijan, Bahrain, Brunei, Equatorial Guinea, Kazakhstan, Malaysia, Mexico, Oman, Russia, Sudan, and South Sudan. OPEC secretary general, Mohammed Barkindo, said that much of the production cuts were expected to come from Russia, who co-chaired the meeting. In a bid to ensure output cut, OPEC created a monitoring committee that included Russia and Oman. Meanwhile, general scepticism remained regarding how committed oil producers would react to the agreement. Shortly after the agreement, however, ADNOC (Abu Dhabi National Oil Company) said it would cut crude supplies by 3-5% across its three export grades to meet commitments under the OPEC deal, which will mostly hit its Asian market. Similar news were soon reciprocated by others in the GCC region. Within a week’s time, Qatar Petroleum and Kuwait Petroleum Corporation said that their production would fall, starting from January next year.

“THE AGREEMENT IS AN UNPRECEDENTED MOVE THAT WILL BE FOLLOWED BY A HIGH LEVEL OF COMPLIANCE, AND WE WILL SEE THAT REFLECTED ON THE SUPPLY-DEMAND BALANCE IN 2017 AND ON THE GLUT IN THE MARKET.” arabianoilandgas.com

NEWS

Abu Dhabi awards stake in ADCO to BP and China’s CEFC

SPOT POLLS

BP and CEFC to join other shareholders of ADCO and the onshore concession

ADNOC signed an agreement with BP, awarding the British oil and gas giant a 10% share — estimated to be worth $2.2bn — in the onshore oil concession operated by ADCO, the Abu Dhabi Company for Onshore Petroleum Operations. As part of the agreement, BP will second up to 50 technical staff to ADCO, bringing technology, expertise, and experience to support the ongoing operation and development of the assets. A few days following this announcement, Reuters reported that the privately-run CEFC China Energy is in advanced talks with ADNOC to acquire stake in ADCO under a 40-year deal. BP and CEFC join Total of France,

TO WHAT EXTENT WILL THE MAJOR OPEC/NON-OPEC OIL OUTPUT CUT DEAL HELP RECOVER CRUDE PRICES IN 2017?

AGREEMENT

$2.2BN Estimated BP’s new stake at the onshore oil consession operated by ADCO.

40 YRS

China’s CEFC is in negotiations to acquire ADCO under a 40-year deal.

Inpex Corporation of Japan, and GS Energy of South Korea as shareholders of ADCO and the onshore concession, each company owning 10%, 5%, and 3% interests respectively. ADNOC will continue to explore opportunities with potential partners for the remaining 12% stake of the 40%, earmarked for foreign partners.

60% say that prices will recover and stay in the $60 range 24% believe that the agreement will not have great sway over oil prices 16% think that prices will surge past $70 per barrel 0% felt that the deal will be sabotaged by non-adherents

Source: arabianoilandgas.com

Picture

of the Month

Shell makes royal re-entry into Iran

Nureddin Shahnazizadeh (C-R), director of Iran’s Petroleum Engineering and Development Company (PEDEC), and Hans Nijkamp (C-L), vice president at Shell, sign an offshore gas ﬁeld agreement in Tehran, in December 2016, for work towards developing major oil and gas ﬁelds, as the country seeks to boost its output. (AFP/Getty Images) arabianoilandgas.com

JANUARY 2017

NEWS

REGION

AROUND THE GCC Latest developments across the region 2 1 4 6

Neutral Zone production to resume NEUTRAL ZONE Saudi Arabia and Kuwait are ex-

1. BAHRAIN

2. KUWAIT

3. OMAN

Bahrain LNG has closed a $741mn syndicated loan for the platform’s construction as it struggles to keep up with demand for gas, according to a company announcement. Standard Chartered, Arab Petroleum Investments Corp (APICORP), and Korea Development Bank were the institutions leading the limited recourse project financing, which was provided by nine international and regional lenders.

The Kuwait Oil Company (KOC) has awarded a contract to Black & Veatch for the licensing technology and related services for sulphur recovery units (SRU) and Acid Gas Removal Units (AGRU) to support natural gas processing on the Jurassic field. The total technology solution encompasses two acid gas removal trains designed for feed gas flow, and three parallel identical sulphur recovery trains.

As part of its drive to create 50,000 jobs in the non-oil sector, Petroleum Development Oman (PDO) has signed 15 Memoranda of Understanding (MoUs) with public and private industry partners. Along with these partners, PDO is sponsoring the vocational training of 1,200 young Omanis as it steps up its efforts to support the government and spur economic diversification.

4. QATAR

5. SAUDI ARABIA

6. UAE

pected to gradually resume oil production from the jointly operated oilfields in the Neutral Zone that lies between both countries, industry sources told Reuters. The closure of the Neutral Zone’s fields, mainly Khafji and Wafra, has become a political sticking point between the two allies and senior officials have been trying to resolve the issue. Khafji was shut in October 2014 for environmental reasons, and Wafra closed in May 2015 due to operation difficulties. Kuwait has limited spare production capacity and has, therefore, been hit harder than Saudi Arabia by the closures. The two governments agreed that any resumption of crude production from shared oil fields along their border won’t raise their output beyond limits set by the OPEC agreement.

DATA SNAPSHOT

BRENT CRUDE OIL PRICES 55

As part of a strategy to support local small and medium enterprises (SMEs), Qatar Shell, in partnership with Qatar Development Bank (QDB), signed four new contracts with Qatari SMEs. These include Buzwair Scientific & Technical Gases, Al-Ahed Trading & Contracting Co Ltd, Second Dimension International Marketing, and Q-Advice translation services.

JANUARY 2017

Saudi Aramco and Siemens have inked several agreements to collaborate in the fields of renewable energy, research and development, as well as digitalisation in the oil and gas industry. Signed during Saudi Aramco’s In Kingdom Total Value Add (IKTVA) Forum, these deals show Siemens commitment and dedication to continuously drive its agenda of local value creation in the Kingdom.

The Abu Dhabi National Oil Company (ADNOC) has awarded Hill International with a $15.5mn three-year contract. Hill’s services will include providing facility management services for the existing portfolio of assets, management of daily operations, support for future expansion plans, management of construction phases including preand post-construction, contract management and project controls.

$52.49

Nov 22

45 Dec 22

Following the output cut deal, Brent prices reached a 17-month high, even surpassing $55 a barrel. Source: oil-price.net arabianoilandgas.com

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NEWS

Qatar to merge Qatargas and RasGas in a move towards efficiency The transition, which will merge the nation’s two largest LNG producers into a single company, Qatargas, aims to cut cost and will take around 12 months to complete

IN BRIEF Saudi Aramco signed deals with several foreign companies, as part of a drive to expand the kingdom’s industrial base and manufacture a bigger share of products domestically. The deals include setting up joint ventures with US-listed firms, Rowan Companies and Nabors Industries to own, manage, and operate drilling rigs in Saudi Arabia.These agreements are in line with the In-Kingdom Total Value Add Programme (IKTVA). National Iranian Oil Company (NIOC) plans to extend oil and gas development studies in the Sea of Oman for the next five years in search of hydrocarbon deposits, the deputy head

14 MERGER Qatar is merging its two

government-controlled LNG (liqueﬁed natural gas) companies, streamlining distribution of the fuel as the OPEC nation grapples with a slump in energy prices. The tie-up of Qatargas and RasGas, Qatar’s top two LNG producers, has been talked about for a number of years, stretching back before the oil price reduction. At a news conference, Qatar Petroleum (QP) CEO, Saad al-Kaabi, said that behind the announcement was an element of wanting to cut costs. “Of course, as the outcome of this cost reduction will be realised, it will make us more competitive in the market,” he said, adding that the move would save “hundreds of millions of dollars”, without giving a timeframe for the savings. The transition, which will result in a single company called JANUARY 2017

Qatargas, will take around 12 months to complete. Once the new structure is in place, some areas of the business could see job cuts, although the operational side of the plants will not be affected, Kaabi said. A Doha-based energy analyst said the move was in line with QP’s recent cost cutting, but also had other benefits. “Arguably, the reasons for having two firms — to deal with Western and Eastern markets, and also to encourage some competition during the rollout phase of LNG facilities — are no longer relevant,” he said. The Gulf country is the world’s largest producer of LNG. Qatargas is the largest LNG-producing company in the world, with an annual output capacity of 42mn tonnes, according to its website. While QP owns a majority stake, global energy firms including Total, Mitsui & Co, and ConocoPhillips also possess small shares.

MERGING QATARGAS AND RASGAS QP CEO Saad al-Kaabi said that behind the announcement was a desire to cut costs.

of exploration department at the National Iranian Oil Company, said. The company’s exploration department is working in tandem with the Research Institute of Petroleum Industry to expand studies in the undeveloped Sea of Oman. Studies include geological surveys close to Iran’s Makran Coast stretching along the Sea of Oman. Egyptian Oil Ministry announced that eight new wells started production since the beginning of the second half of 2016. These wells, which are affiliated to different firms, added 517mn cubic feet of natural gas and 2,500 barrels of crude oil to national production. The new wells are located in concession areas joint between International Oil Companies (IOCs) and Egyptian oil sector firms at the Mediterranean Sea, Nile Delta, and Western Desert.

arabianoilandgas.com

NEWS

IN QUOTES

NIOC strikes deals with several IOCs to boost upstream sector European majors Shell, Total, and Eni sign initial agreements to work in Iran

“I think we need to seize the opportunities in the market. In the type of challenging conditions that we are in, the small players or those who are not strong enough won’t survive.” – Benoît Labre, managing director for the Middle East business of Flexitallic.

A signing ceremony between NIOC and major ICOs

AGREEMENT December saw the

“We recognise that oil producing companies rely on their existing assets. We believe for every marginal or mature field, there is a cost-effective solution to maximise the profits.” – Fawaz Ahmed, Middle East regional sales manager, Frames.

“Indeed, mobile technology and augmented reality will make the Big Data light and easy to use on day-to-day basis, driving operational efficiency.” – François Haynes, Intergraph PPM.

Iran oil and gas industry striking several deals with IOC’s in a bid to develop its oil and gas sector. Royal Dutch Shell signed a memorandum of understanding (MoU) with National Iranian Oil Company (NIOC). Analysts said the agreement underscored major oil companies’ willingness to keep doing business with Iran, despite the risk that US President-elect

Iran has the fourth largest proven oil and the largest proven gas reserves in the world.

4.8 MN

Iran’s 6th Five-year Development Plan targets oil production of 4.8 MMb/d by 2021.

PLAY/PAUSE:

BP Plc has the highest exposure in the countries

Who’s moved up in the oil and gas world last month, and who’s been falling away?

Oman’s energy ministry

Aramco’s planned flota-

received over five bids

tion is unlikely to require

that have agreed to cut

from IOCs that want to

output. The participation by Russia, where BP

take over Block 30. The

any major changes to Saudi’s securities rules.

bidding was buoyed by

The company is targeting

holds a 20% stake in

new interest from Asian companies. The ministry

2018 for what is expected to be the world’s

will announce the new licensee in January.

biggest ever initial public offering (IPO).

Rosneft, puts it ahead of rivals Total, Shell, ExxonMobil, Eni and Chevron.

arabianoilandgas.com

4TH

Donald Trump could scrap the nuclear deal that ended the sanctions earlier this year. Another deal made in December by NIOC was with Russia’s Gazprom Neft when they signed a MoU for feasibility studies on development of Changouleh and Cheshmeh-Khosh oilﬁelds in Western Iran. More recently, Eni signed a shortterm contract with NIOC as it seeks to revive their agreements prior to sanctions on Tehran. One month prior to these announcements, BP had created a new executive committee to explore business in Iran, which excludes its American chief executive, Bob Dudley, to avoid potential violations of US sanctions still in place. The move highlights the lengths to which multinationals will go to exploit lucrative new business opportunities in Iran.

Iraq is selling more crude to its biggest customer, China’s Unipec. With new deals with Indian refiners, the expanded contract means Baghdad will have to reduce supply to other clients in line with the OPEC cut deal. JANUARY 2017

COMMENT

Have your say: Contact indrajit.sen@itp.com

Securing the critical infrastructure holds key The cyber defences used in the MENA region to ward off attacks are outdated and ineffective, remaining highly vulnerable to hackers, Mohammed Abukhater writes

T 16

he energy wealth of the region has certainly attracted a lot of attention – including the undesired kind. Technological innovations, coupled with the drive towards ‘smartification’ and complex geopolitics, have made the oil and gas sector susceptible to an increasing wave of cyberattacks – a sector that forms the bedrock for most economies in the region. An essential component of this sector is critical infrastructure, supported by industrial control systems (ICS). Once predominantly manual, many of the tasks in the energy supply chain, from exploratory drilling, to production, refining and distribution, are now monitored and controlled by ICS. However, as control systems and other devices that were previously not connected come online, their attack surface increases, thus presenting new risks. FireEye iSight Intelligence has identified nearly 1,600 publicly disclosed ICS vulnerabilities since 2000. The pace of technological innovation, which encompasses the Internet of Things, cloud computing, smart cities,

JANUARY 2017

mobility and unprecedented levels of connectivity, means that hackers now have more channels to launch attacks. Take away this vital pillar of operations and you take away the ability of the organisation in question to function. Critical infrastructure is only as good as the security systems and protocols in place to ensure its protection. Many of the cyber defences used by regional organisations and critical infrastructure operators to ward off attacks are outdated and ineffective, remaining highly vulnerable to hackers – and as evidenced by headlines in recent years. Cyberthreat actors are not blind to this fact. In 2012, cyberattackers targeted Saudi Aramco, infecting 30,000

About the author: Mohammed Abukhater, regional director for the MENA at FireEye

computers with malware and taking them offline. Within a matter of weeks, an attack on LNG producer RasGas resulted in the shutdown of its computer network. In another instance, the US Justice Department indicted seven hackers this year for staging a coordinated cyberattack that targeted a dam near New York City. Needless to say, there have been a worrying number of attacks on critical infrastructure, with no signs of them abating anytime soon. The motivations behind these attacks are varied. Actions in cyberspace are merely a reflection of real-world politics and conflict – and in this region, the lines of conflict are highly complex, to say the least. For the financially motivated or the ideologically driven, the local energy sector presents an alluring target. Advanced Persistent Threat (APT) groups may attempt to steal information that can assist their sponsoring government in ensuring national and economic security. Data theft will likely involve information related to natural resource exploration and energy deals. APT groups may also engage arabianoilandgas.com

COMMENT

in destructive and disruptive actions against an adversary’s energy industry in the event of conflict. Continued innovations in fossil fuel development and alternative energy production will also lead to increased cyber espionage as APT groups try to obtain related intellectual property and proprietary data for the benefit of state-owned companies. Growing global demand for energy and dwindling natural resources will likely result in increased cyberespionage against the sector as nation-states seek intelligence that would afford them a competitive advantage when vying for energy security. Simply put, the threat to the energy industry has never been greater. According to IDC, 80% of regional firms lack the tools to detect and assess threats, while 42% say that cybersecurity solutions are not enough to manage cyber risks. With few regulations in place, it has become increasingly important for these industries to assess their environments and cybersecurity risk. One way to do that is through compromise assessments or ICS assessments. These tests search the environment to identify whether or not a hacker is currently in the system. If a breach is identified, the organisation can work to stop it and secure their system before any valuable information is taken. Security assessments may spell the difference between being compromised and conducting business as usual. These ICS assessments can bolster cyber defenses by analysing the network to verify traffic patterns and gauge severe risks. Organisations could also perform “red team” operations. In this assessment, a team of experts attempts to hack into an environment and, if successful, they can then reverseengineer security features to make sure that a real hacker cannot gain arabianoilandgas.com

access to the system. Additionally, pre-planning and incident response preparedness are both excellent ways to stay ahead of the breaches that typically catch organisations flatfooted. What is encouraging to note is that GCC states, such as Saudi Arabia, the UAE and Qatar, have – in response to these challenges – started taking the first steps towards instituting comprehensive cybersecurity policies, with an emphasis on critical infrastructure. This is a move in the right direction and indicates their understanding of a key fact: protecting the oil and gas sector’s critical infrastructure isn’t just an issue of national security; it’s something that future growth prospects invariably hinge on. In the end, the best way to address this challenge is collaboration. A firm alignment of people, process and technology will ensure the protection of the organisation’s critical infrastructure and ICS. This entails the involvement of employees across all levels of an organisation. The fallout from a successful breach is not just the loss of operational control and financial resources,

but also a reputational backlash, compromising the company in the long-term. Greater cooperation between firms can also prove to be instrumental in turning the tide, safeguarding critical infrastructure and stopping malicious actors dead in their tracks. A good example is the mutual exchange of information between central banks in the Far East, which allowed Bank Indonesia and the Bank of Korea to foil a recent DDoS attack. Taking note of this, the energy sector would be well-advised to follow suit. According to a report by the World Energy Council, spending on cybersecurity by the energy industry is slated to hit $2bn by 2018. Given the geopolitical context of the region and its importance in energy economics, oil firms will remain an enticing target for threat actors in the foreseeable future. As industrial control systems are foundational to the continued success of those firms and national economies, we anticipate they will come under increasing attack. Those who fail to prepare and collaborate may find themselves unable to fill up the tank.

JANUARY 2017

COMMENT

Have your say: Contact indrajit.sen@itp.com

Interesting state of affairs in the global oil and gas industry A number of factors including the growing cost of production in some regions among others, the role of OPEC in coordinating the scope of production all around the globe and the volatility of the US dollar, may provide a basis for sustaining the current levels of oil prices in mid-term

G 18

lobal growth in the oil and gas sector is expected to rise moderately at about 3.3% through 2017. High-income countries are likely to see growth of more than 2% next year while developing countries shall continue rising to 5.4% by 2017 (+1% higher rate of growth than in 2014). There are many different considerations to take into account that may impact the future demands for crude oil as well as the future price levels. It would be interesting to consider certain observations. Increase of oil production in North America as well as the recent announcement of major reserves found in Texas, USA has not led to a global oil price collapse as we saw previously. The recent news about the privatisation of 19.5% of the largest Russian oil company – Rosneft – by the JV between Glencore and the Qatar Fund led to a bounce in oil prices as the shares of the company reached an all-time high. The future of oil production in Russia may not be so

JANUARY 2017

clear for many industry experts; we are seeing a reduction in the amount of oil processed in many Russian and CIS reﬁneries. Hence, this leaves more for the export markets at similar levels of production. A number of factors including the growing cost of production in some regions, the role of OPEC in coordinating the scope of production all around the globe and the volatility of the US dollar, may provide a basis for sustaining the current levels of oil prices in the mid term (see graph). The continued rise in the global trade of oil is expected to reach a peak at about 37mbpd in 2017. The volume of oil reﬁning and petrochemicals production is expected to

About the authors: Colin Chapman is the president of Euro Petroleum Consultants. Ekaterina Kalinenko (next page) is a project manager at the Moscow office.

increase in some regions while margins remain relatively high. Some regions may suffer from overcapacity, especially where construction is the most active, like Asia. The Middle East will continue to maintain its position as a major refining centre and the USA could also increase its export volumes once more new oilfields come into production. The largest potential players in terms of spare capacity are Saudi Arabia and Iran; both countries are seeking significant investment to maintain and expand the existing level of production. The lifting of Iran’s sanctions has led to a significant change within the region. Iran could become one of the fastest growing economies in the region over the next five years as investment comes into the country (NIOC will need ~ $134bn for future upstream oil and gas projects by 2021). Potential growth is expected to be in the region of 5% in the period 2016 -2020. The Iranian government gave arabianoilandgas.com

COMMENT

approval for the new general scheme of Integrated Petroleum Contacts (IPC), and this is expected to support the development of the industry even more. Iraq’s oil ministry is postponing a bidding round for 12 small- and medium-sized oil ﬁelds across three provinces to the middle of 2017. Other companies in the Middle East region are expected to reduce capital investment to continue the trend that was seen in 2016 where expenditure was cut by ~ 30 % in 2016 - more $200bn worth of projects were canceled or postponed. Another important country is Iraq which produces about 4% of the global oil supply and is the secondlargest producer in OPEC after Saudi Arabia. Iraq also possesses a potential for increasing its share in global oil supply since great amounts of proven reserves are still underexplored and the cost of oil production is lower than in many ME producing countries. In 2009, the federal government started awarding Technical Service Contracts (TSCs) to international oil companies: the government reimburses for the cost of oil production and CAPEX plus an

agreed fee per barrel of production. The government has come to an agreement with BP, Shell and Lukoil to restart investment to increase output that will bring another 250,000bpd in 2017. ExxonMobil and PetroChina are also discussing their plans to boost production within the country. But the limitations of Technical Service Contracts may impact Iraq’s medium-term oil sector expansion plans. The government plans to increase oil production capacity by 2020 via service contracts. Of course much depends upon future agreements between OPEC producers as to what level Iraq may reach. Existing oil pipeline infrastructure, especially for export, will require upgrading if oil exports are to be substantially increased. Operators also face a deﬁcit of drilling rigs and water resources. It is expected that there will be no more than 1.4% production increase for Iraq in 2017 due in part to the fact that the existing production facilities are reaching their peak capacity. Within these conditions it’s more likely that oil production in Iraq will reach only 6.5-7.0mbpd by 2020.

120.00 98.89 100.00

80.00

93.17

52.32

60.00

49.91 42.84 50.91

40.00

48.67

43.30

20.00

0.00 2014

2015

WTI Crude Oil

2016

2017

Brent Crude Oil

Oil price comparison (2014-2017 forecast), dollars per barrel Source: EIA analysis, 2016

arabianoilandgas.com

Ratiﬁcation of OPEC’s production control agreement in late 2016 could lead to increased production of US shale oil and gas. The fall in production by OPEC countries could be substituted by at least 500,000bpd from shale sources. US operators expect this year to be the plateau for oil prices and anticipate a slight increase in 2018, to raise shale production in the US to a substantial amount. The price of $60/barrel is considered to be the minimum required. OPEC is likely to monitor closely US companies as they invest and build wells in 2017 before the planned meeting in May – this will deﬁnitely impact the results of that meeting. Another important factor to consider is the new president elect of the USA who is expected to bring to the White House an advocate for oil and gas drilling. US unconventional shale oil production is expected to decrease further in 2017 (since the peak of 4.9mbpd in 2015) before its possible revival of 11% in 2018, according to the US Energy Information Administration. However if US oil companies continue to increase production, this will no doubt impact future decisions by OPEC producers regarding their own production levels and will inevitably result in pressure on crude oil price levels. JANUARY 2017

LIFE LESSONS

INTERVIEW

Soaring to great heights Chris Fleming, CEO of Cyberhawk Innovations, reminisces about his journey in the oil and gas industry and how he was led into the fantastic world of UAVs INTERVIEW: INDRAJIT SEN

rom a young age I was fascinated by the oil and gas industry. In the early 80s, the oilfield was a dangerous but somewhat exciting environment. I’m lucky that there have been many highlights throughout my career. I landed my first role in the industry in 1994 as an industrial radiographer and had the opportunity to work offshore on non-destructive testing projects off the coast of Australia. On a trip to the UK in 1997, a friend introduced me to the world of rope access inspection. I wasn’t aware of anyone in Australia working with this technique and seeing the huge potential it offered, particularly in terms of health and safety benefits, I seized the opportunity to introduce this technique back home and became one of the first rope access qualified inspectors in the region. It was an unproven skill in the country at the time and I worked tirelessly in a niche market to drive this new technology. In 2003 I returned to the UK to work in the North Sea and, between offshore trips, led a team carrying out the inspection during a JANUARY 2017

particularly bitter winter. We were blasted by continual wintery snow showers over a four week period doing a job that would now take a matter of days with a UAV (Unmanned Aerial Vehicle). With the good, comes the bad, and the ugly. I’ve witnessed some catastrophic incidents in my career and I truly believe I know what risk is. It’s important to drive home the overriding factor of safety when carrying out hazardous inspections – we all want to come out alive. Innovation needs open minds. During a tea shack conversation on an oil rig, Malcolm Connolly, one of Cyberhawk co-founders, had a light bulb moment. He wondered about the possibilities of adding a camera to a remote controlled helicopter and using them for visual inspections. His simple idea of modifying the technology has introduced huge safety and cost saving beneﬁts to the oil and gas industry and has seen Cyberhawk grow at a phenomenal rate to become a leading aerial inspection and survey services provider using UAVs – quite a success story.

“I BELIEVE THAT UAV TECHNOLOGY IS QUITE REVOLUTIONARY - THE BIGGEST CHANGE, AND IMPROVEMENT, IN OIL AND GAS INSPECTION IN THE LAST 10 YEARS.” The oil rich Middle East remains a real growth region for Cyberhawk. It’s the natural playground for companies operating with UAVs because of the production output. The willingness to use new technology is high and we’ve seen first-hand the impressive growth opportunities the region has to offer. Since our first flight in the Middle East, six years ago, we have seen many positive changes. From plant management to government authorities, the technology has been carefully observed and its benefits have been recognised, and most importantly understood. The downturn in the oil business has introduced a rat race for operators, the continual undercutting of competitors when it comes to value for money. We’ve experienced the immediate effect of losing out to smaller inexperienced companies; however, the cheapest option isn’t always the best choice. On numerous occasions we’ve been called upon to find solutions for failed projects carried out by competitors. I believe UAV technology is the biggest change, and improvement, in oil and gas inspection in the last 10 years – it’s a tangible, realistic technology that will revolutionise our industry so that the data capture part of the job can be carried out remotely, and thus safely. There’s no doubt about it, standing on the edge of a platform, preparing for a flight at a high level within an intense environment, the pressure is on. But, the adrenaline keeps me going and the sky is the limit. arabianoilandgas.com

LIFE LESSONS

WHAT ELSE DO YOU NEED TO KNOW ABOUT CHRIS?

Chris grew up listening to his father telling him tales from the bottom of the deep blue sea and spent countless hours looking at photos from his experiences during the commissioning of the Shell Brent field in the UK North Sea.

arabianoilandgas.com

JANUARY 2017

COVER INTERVIEW

Sealing equipment provider Flexitallic is consolidating its position as a leading supplier of gaskets to the oil and gas industry by offering innovative and effective products, and eyeing regional and global expansion

RINGMASTER OF GASKETS WORDS: INDRAJIT SEN

ealing solutions might be perceived to be a lesser operational aspect of the oil and gas industry, but it is far from it. The global upstream industry encounters the natural menaces of corrosion and high temperature environments, as a result of which, operators frequently face the expensive proposition of having to replace the ﬂanges in a pipeline or a drilling equipment, or the damaged asset as a whole. Gaskets are quite often JANUARY 2017

the panacea, as the ring-like structures help in clamping disjoined assets together and form part of sealing solutions, which eventually help operators save considerable sums of money, otherwise meant for maintenance and repair. “For every process industry, you need to perform maintenance. You need to be able to open the pipe and vessel for inspection and repair,” Benoît Labre, the managing director of the Middle East business of Flexitallic, told me during my recent visit to the sealing products and services manufacturing company’s facility in the northern emirate of Ras Al Khaimah (RAK). “To connect two pipes together while preventing any leakage, you will need gaskets. The gaskets arabianoilandgas.com

COVER INTERVIEW

arabianoilandgas.com

JANUARY 2017

COVER INTERVIEW

Flexitallic’s history can be traced back to 1912, when it was formed in New Jersey.

The oil and gas business is the biggest revenue generator for Flexitallic.

will be compressed between the ﬂanges, the pipe system, or also in the pressure vessel for the heat exchanger. The advantage of gaskets in comparison to the welding process is that you can open the system without having to touch the integrity of the asset,” he tells Oil & Gas Middle East. The Texas-headquartered company, which has important bases in the UK and France, has been providing gaskets to a range of industries “Firstly, we work with the oil and gas industry, which is our biggest revenue generator, especially here in the region. Oil and gas is our main market; we work with all three of its segments – upstream, midstream, and downstream,” says Labre, a Frenchman who has been mandated with spearheading the growth of Flexitallic in the region. “We work also with the processing industries, including petrochemicals; chemicals; specialities; and power generation, including conventional and nuclear – not yet here in the region, but worldwide in France and the US. Worldwide we are one of the main sealing providers to the nuclear industry. We also work with the automotive, oilﬁeld services, and OEM (valves, pressure vessels, pumps, heat exchangers, etc.). We, recently, started to focus on the high technologies industries such as solid oxide fuel cells.” Flexitallic might be a relatively lesser known name in the oil and gas industry, although, quite

“I LIKE TO DEFINE OUR COMPANY, NOT ONLY AS A GASKET PROVIDER — BECAUSE THAT’S WHERE WE GET OUR REVENUES FROM — BUT ALSO AS A SEALING OR TIGHTNESS PROVIDER.” BENOÎT LABRE, MIDDLE EAST MANAGING DIRECTOR AT FLEXITALLIC.

JANUARY 2017

astonishingly, the company has been making industrial gaskets for over a century! “It is a very old company because we can trace back the company to 1912 when it was formed in New Jersey, US to invent the spiral-wound gasket designed to seal high-pressure systems. These gaskets are now the building block for all reﬁneries, petrochemical plants, and power generation stations,” Labre says. For a company whose core business is to deal with the oil and gas industry, setting foot in the Gulf was inevitable. “One of our main strategies was to get closer to the customer (in the region). You cannot serve the customer if you are 10,000 kilometres away. So that’s why we tried to get here to have an extensive access of the local market,” Labre says. He continues, “In the GCC, the story dates back to 2008, when Novus Sealing, which already had a branch in the UK, was set up in the Middle East, when we realised the importance of the GCC. Novus was later acquired by Flexitallic and Novus Middle East became Flexitallic LLC.” arabianoilandgas.com

COVER INTERVIEW

beginning of 2009, although the decision was taken in 2008. The main reason was the cost, which was competitive compared to other locations, while still providing excellent infrastructure and services.”

30 NATIONS

FLEXITALLIC MAINTAINS A NETWORK OF 750 DISTRIBUTORS ACTIVE IN 30 COUNTRIES, AS ITS CLIENTS PREFER TO DEAL WITH CHANNEL PARTNERS. Flexitallic today boasts of being present in nine locations around the world — Britain, the US, France, Canada, Germany, China, Singapore, Kazakhstan, and the UAE, and employs about 1,200 people globally. The regional company, Flexitallic LLC, which was formed in April 2013 as a result of the acquisition of Novus, this year invested a whopping $4 million in a new manufacturing unit in RAK, which employs about 25 staff members. On being asked about why Ras Al Khaimah, of all industrial locations in the UAE, was chosen as the ground for planting Flexitallic’s ﬂag in the Middle East, Labre explains, “We formally opened in the arabianoilandgas.com

Products fuelled by innovation During our detailed discussion, Labre, in his elementary French suaveness describes Flexitallic as “a company that has been found on the back of innovation”. He says, “I think it’s very important to have extensive R&D (research & development) facilities; we have it in conjunction with Flexitallic in the UK and the US. We have got several application engineers, who are in direct contact with the customer. So they know all the problems typically faced by the customer. “However, I like to define our company, not only as a gasket provider — because that’s where we get our revenues from — but also as a sealing or tightness provider. The tightness is the result of the gasket’s performance, in conjunction with the hardware and correct installation procedures. We, at Flexitallic, are able to provide installations advices on hardware such as flanges and bolts.” For the upstream industry, Flexitallic primarily supplies ring joint gaskets — which are solid and metallic, as well as spiral wound gaskets, which Labre claims, Flexitallic is the inventor of. Flexitallic’s focus vis-à-vis the upstream sector is to address the issue of corrosion. “We have developed specific gaskets to mitigate corrosion effects, providing both reactive and preventive maintenance solution,” Labre mentions. The dignified business leader goes onto elaborate on a few iconic sealing products that Flexitallic has developed — innovations that have become the hallmark of the company. “The first product JANUARY 2017

COVER INTERVIEW

a proprietary product designed to re-invent the concept of the spiral wound gaskets. It addresses leaking issues in heat exchanger problems. “We also equally focus on the high pressure aspect, as we are aware that the upstream industry has to deal with issues related to it. For high pressure, the industry uses ring-type joint gaskets. However being fully metallic gaskets, it is prone to damage. So we provide solutions such as Kamm-orj or Carrier ring, that can accommodate the ﬂange damages, avoiding ﬂange replacement.”

Flexitallic works with NOCs such as the ADNOC Group, Aramco, Qatar Petroleum and PDO.

Currently, Flexitallic is present in nine locations around the world.

JANUARY 2017

that we have developed is the flange rescue gasket (FRG) – something that we originally designed for the North Sea oil industry, the offshore sector. It enables bolted joints to be easily and effectively sealed even when severe flange face corrosion can be found. This saves time, reduces lost production, and provides a major cost saving when compared with replacing flanges, welding, and machining.” He continues, “The second one that we had been working on for the last few years and was recently launched is the Corriculite. Most of the spiral wound gaskets, used in the upstream industry, contain graphite. The problem of graphite is that it has high electrochemical potential. It can corrode the flange in the presence of an electrolyte such as water or wet gas. “The Corriculite has been developed in order to provide a tight seal, which is even better than what graphite offers, and provide fire-safe solutions and prevent any corrosion that can be faced with graphite.” One of the company’s other offering, Thermiculite, can be used in high temperatures of up to 1000°C; a product that Labre describes as “a revolution that we brought to the market”. The product can and is being used in all sorts of hightemperature environments and process industries such as in petrochemical plants, refineries and power generation stations. Labre says, “The Change™ metal wound Heat Exchanger Gasket is our latest innovation, also called dynamic recovery gasket (DRG). It is a gasket mainly designed for high technologies. It’s

The expansion campaign Flexitallic has been working with global oil and gas majors such as Total, Shell, Maersk Oil Qatar, Valero in the US, and oilfield services provider OEM. Regionally, the ISO 9001 and 14001, and OHSAS 18001-certified company — the first manufacturer in the Middle East to get the safety accreditation — works with NOCs such as ADCO, GASCO and ZADCO of the ADNOC Group, Saudi Aramco, Qatar Petroleum, and Petroleum Development Oman (PDO) to name a few. The company has also worked with a number of EPC contractors in the region, the likes of Technip and Petrofac to name a few, more importantly on projects such as the Zakum Oil Line replacement project in Abu Dhabi, Salalah gas field development

$4MN

FLEXITALLIC HAS INVESTED $4 MILLION IN ITS NEW MANUFACTURING UNIT IN RAS AL KHAIMAH, WHICH EMPLOYS AROUND 25 OF THE 1,200 PEOPLE GLOBALLY.

arabianoilandgas.com

COVER INTERVIEW

Labre says Flexitallic’s policy is to be as close to the customer as possible.

The company has worked on a number of key regional energy projects.

Flexitallic intends to expand regionally in Oman, Qatar and Kuwait, as well as globally in Germany.

arabianoilandgas.com

project, the West Qurna project in Iraq, and the Sohar refinery project in Oman. In Flexitallic’s experience, most oil and gas companies, like ADNOC, prefer to deal with distribution partners over the actual suppliers, so the company maintains a network of 750 distributors in 30 countries. Labre concedes that, much like every other company associated with the oil and gas industry, the year 2016 hasn’t been kind to Flexitallic. The company, which earns an average annual turnover of $180-200 million globally, has secured lower than average revenues this year due to subdued demand for its products, although Labre says, the company definitely fared better in the third quarter of 2016 compared to the first two quarters. “We have definitely seen a reduction in investments, there are less projects in the market, there have been delays or shutdowns in the market as well,” Labre admits. “There is still demand, people want to reduce prices but they don’t want to compromise on the quality. So that’s where we are focussing on — providing the same quality products that we did before. We don’t want to compromise on it while optimising the prices,” he says. Flexitallic has been able to establish its regional client base post setting up the base in RAK. “In the Middle East,” Labre states, “our main market is in the UAE – Abu Dhabi, Dubai, and the Northern Emirates. Our next big markets are Oman and Qatar. The next goal is to expand in Saudi Arabia, Bahrain, and Kuwait. “Iran also presents a great opportunity for us. There is some progress, and we are trying to make

inroads into the country. We conduct some of our business in Iraq as well despite the current (security) situation.” As for the company’s expansion strategy, Labre says, “Our objective is to maintain close contact with the end-user, and to do so, we need to be geographically present in places where our enduser is. That’s why the company is expanding in key geographical locations such as the UAE, or in Germany recently. Our next step would be to open some service centres in Oman, Qatar, and Kuwait to expand our local geographical coverage and responsiveness to customer needs.” Labre, the charmingly humble executive, wants to tackle competition in the market by adhering to the company’s core ethics and quality, and feels Flexitallic has the edge over its peers as being a holistic sealing solutions provider over others who are just gasket suppliers. “My goal is to make the customer see us very different from the competitor, not only as a gasket but also a sealing provider. Something which our competitors don’t do. That’s really what we aim for — to differentiate from the others with services and speciﬁc solutions to answer the toughest industries issues.” JANUARY 2017

WELLHEADS & EQUIPMENT

WORDS: YASMIN HELAL AND INDRAJIT SEN

ADEPT WELLHEADS KEY TO SECTOR’S TOTAL WELLNESS Efficient wellheads and equipment that reduce risks as well as maintenance costs in the prevailing market conditions, besides helping operators optimise production efforts, remain a core requirement of the regional upstream industry

Fawaz Ahmed, Middle East regional sales manager, Frames.

JANUARY 2017

hile on one hand the regional oil and gas industry drastically reduced capital expenditure during the course of the last year (or even more), clamour for efﬁcient machinery and equipment has grown in the upstream sector. That, in part, can be attributed to the fact that the regional operators in the past year have been striving to increase production in their contest for market share, and have therefore been demanding products that would help them in their cause of optimising production from the oil wells. Key to controlling the performance and pressure of crude production, maximising the efﬁciency of wellheads and equipment, while reducing risks as well as costs, has been at the forefront of the sector, particularly in the region. Given the region’s dependency on the oil and gas sector, addressing issues relevant to wellhead and equipment during the low oil price environment is more critical than ever. “The wellhead systems vary depending on the type of well that is being automated. Almost all wells share the same basic measurement points,”

Yaser Al Ghamdi, wellhead business development manager for the MEA region at Emerson Automation Solutions, tells Oil & Gas Middle East. “These are tubing (wellhead) and casing (annulus) pressure, and flowline temperature and pressure. Additional measurement and control points may be related to choke position, gas lift rate, and links to downhole measurement and ESPs (electrical submersible pumps), as well as flame and gas detection for some higherrisk wells,” he explains. Wellheads and equipment must be reliable enough to be operating well in extreme conditions and high temperatures, while being exposed to highly corrosive content. With the main function to control the flow from the reservoir, wellhead equipment comes in two types — pressure containing and pressure controlling parts. Equipment failure in the former, like bodies, bonnets and stems, result in a release of retained fluid into the air, while the latter, such as valve bore sealing mechanisms, choke trim and hangers, are meant to regulate the movement of pressurised fluids. If the pressure is not contained properly while drilling the oil well, the operators face the risk of a blowout. Regarding their operations in the region, Middle East regional sales manager, Fawaz Ahmed at upstream equipment provider arabianoilandgas.com

WELLHEADS & EQUIPMENT

“THE WELLHEAD SYSTEMS VARY DEPENDING ON THE TYPE OF WELL THAT IS BEING AUTOMATED. ALMOST ALL WELLS SHARE THE SAME BASIC MEASUREMENT POINTS.” YASER AL GHAMDI, EMERSON AUTOMATION SOLUTIONS.

Technology players in the oil and gas industry have developed different solutions for regional clients.

arabianoilandgas.com

Frames, says, “We serve IOCs as well as NOCs within the upstream oil and gas industry. We observe a higher request for data collection, both from wells and at the control room.” “This data is analysed to optimise the lifetime production of the ﬁeld and, therefore used to control the individual components at the wellhead location. We also observe a higher request in autonomous units. By means of solar power systems and remote telemetry units, this can be achieved,” Ahmed says. Having the right workﬂows implemented to help operators make better business decisions, and then quickly act upon them, is critical to maximise ef-

ﬁciency. Companies that have a track record of implementing workﬂows from a library, not building them from scratch, have demonstrated the ability to help oil producers to streamline operations and increase yields in a matter of weeks or months. Best-in-class operators get 10% more uptime for about a quarter of the maintenance budget, so making reliability a business decision and outsourcing maintenance solutions to vendors are areas, where wellhead equipment manufacturers and service providers witness considerable interest. Proper drilling is vital Drilling events and the eventual outcome of a drilling campaign can be unpredictable, with some incidents leading to expensive or damaging outcomes. Reducing downtime can be critical for the exploration and production (E&P) sector, especially after extensive open-hole logging, or any operation that requires the wellbore to be left open for a prolonged period of time. There are a number of issues that can occur when running in or out of JANUARY 2017

WELLHEADS & EQUIPMENT

65-85%

THE TYPICAL INSTALLATION TIME SAVINGS ARE IN THE REGION, BRINGING WELLS ONLINE FASTER

Reservoir models need to be validated in real time.

With the use of drilling motors, the chances of running casing to the bottom of the hole improves.

JANUARY 2017

the hole with a drill string, including tight spots, swelling shales, or wellbore instability. Mia Jones of Geopro Technology Ltd explains that using a high torque drillable motor is one way to overcome the need for wiper trips, when running casing, liners, or completions strings. Such wiper trips can be time-consuming and expensive, especially at offshore and deepwater sites. These motors integrate positive displacement motor technology into the casing/tubular assembly, with complete ‘drillability’ at the end of the casing string. According to Jones, the entire body of the tool rotates and can generate drilling motor torque levels of performance with circulation, thus providing reaming capability up to 60rpm (rotations per minute), as well as acting like an agitator at the casing shoe. The high torque means that the tool is signiﬁcantly less likely to get stuck, and more likely to drill/ream through most obstructions, obviating

the need to remove the entire string. The larger the borehole, the more torque can be generated. Meanwhile, being able to drill through the tool means that even if it does get stuck, the rig crew can easily adopt a contingency plan of prematurely setting the casing/liner at that depth, because the tool can be drilled out. Drilling of the next hole section can commence with little disruption to the overall well delivery strategy. With the use of such drilling motors, the chances of running casing to the bottom of the hole, which is dependent on the lower section of casing, are greatly improved. Wellhead neo-technology The key to the instrumentation choices at the wellhead is about getting better insight faster. This enables reservoir models to be validated and production decisions to be monitored in real-time. In order to collate data from real-time surveillance of the wellheads, the sector has adopted new technology for smoother operations. Because of the large number of remote wellheads in the region, for which manual monitoring remains impractical and hazardous, wireless surveillance naturally takes centre stage when it comes to oil wellhead technologies. According to Ahmed, using technology like a telemetry solution to monitor, control, and operate remote wellheads can signiﬁcantly save in CAPEX (capital expenditure), providing optimised solutions and eliminating interface issues. Meanwhile, major oil and gas equipment and technology provider, Emerson, is of the opinion that wireless monitoring systems installed at wellheads improve operations, reduce ﬁeld visits, and improve HSE (health, safety, and environment). Installation time is reduced ten-fold by using wire-

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WELLHEADS & EQUIPMENT

Wireless monitoring systems installed at wellheads improve operations.

Yaser Al Ghamdi, wellhead business development manager for the MEA region at Emerson Automation Solutions.

less instead of wired instrumentation and costs are cut to half. Emerson cites a client example to prove its case in point. KOC (Kuwait Oil Company) needed to add remote monitoring systems on 357 wellheads to improve upon existing data gathering procedures, according to well surveillance engineer, Ali Faras. These procedures required frequent trips to each wellhead to record data, and manual data entry to get this information into production optimisation systems. Manual operation and monitoring of such a high number of wells began to be very tedious and time-consuming, and it presented hazards to ﬁeld personnel. Optimising production was almost impossible due to insufﬁcient instrumentation at many sites, lags in data collection, and subsequent data entry. To eliminate these time-consuming trips, KOC needed to install instrumentation at each wellhead, and then exploit the breadth of available technologies to monitor key process variables in real-time. Prior to the use of the less costly wireless solution from Emerson, early implementations indicated that the average time needed to install the necessary wired instrumentation was

“ELIMINATING MOST OF THE REQUIRED WIRING AND INFRASTRUCTURE REDUCED INSTALLATION TIME FROM ONE WEEK TO JUST HALF A DAY PER WELLHEAD.” ALI FARAS, WELL SURVEILLANCE ENGINEER, KUWAIT OIL COMPANY arabianoilandgas.com

one to two weeks per well, much too long given the hundreds of wells requiring upgrades. Not to mention other operational constraints including required excavation procedures and costs, and HSE risks. These issues led KOC to consider a wireless solution. According to Faras, “By eliminating most of the required wiring and corresponding infrastructure, installation time was reduced from one week to just half a day per wellhead. Installations costs were cut in half, saving $3,000 per well. HSE risks were also reduced as much less excavation and wiring work is required in these potentially hazardous areas. Data accuracy is in the range of 99.9%, more than sufficient for the application, and data availability is also high.” To cater to this growing need, technology players in the oil and gas industry have been developing different solutions for their regional clients. According to Al Ghamdi, compiled data needs to be put into context and analysed, so an RTU will bring the data to a SCADA system. The latest generation of Coriolis and Modular Multiphase Flowmeters can cost-effectively give real-time three phase flow measurement at the wellhead. “Emerson’s customers have found great value in using wireless to implement well monitoring faster and for a fraction of the price of traditional wired systems. The measurement points are connected instantly, with no need for the time, costs, and risk exposure associated with installing, trunking, and cabling in the field. Commissioning is faster, and bringing wells back into service after a workover JANUARY 2017

WELLHEADS & EQUIPMENT

The slowdown in the upstream sector has affected the GCC wellheads market.

Wellheads equipment must be reliable enough to operate in high temperatures.

is quicker and easier, as there is no cable infrastructure for the workover rig to damage. Typical installation time savings are in the range of 65% - 85%, bringing wells online faster after completions and workovers,” he further elaborated. Frames is another provider of all the equipment required for (production) wellsite control and well safety, as separate products as well as an integrated solution. “Our decades of experience,” Ahmed says, “in engineering and supplying modularised equipment enables us to integrate from a practical point of view with a clear understanding of all technical and commercial consequences. By integrating all hydraulics, ﬂowline assurance, well monitoring, safeguarding, onsite control logics, communication, independent solar power supply, and back-up as one integrated solution, our clients beneﬁt from minimum interface engineering, procurement time and fast commissioning times and reduced operating costs.” The market challenge The slowdown in the upstream sector has undeniably had an impact on the wellheads and equipment market in the GCC. Yet, oil producers across the region have been working hard at maximising output and doing more with less. “It is not possible to do either of these things without best-in-class automation,” says Al Ghamdi. “Headcount pressure in our customers’ organisations has meant that there are fewer people available to do manual rounds, and so it

JANUARY 2017

“HEADCOUNT PRESSURE IN ORGANISATIONS HAS MEANT THAT THERE ARE FEWER PEOPLE AVAILABLE TO DO MANUAL ROUNDS, SO IT HAS BEEN IMPERATIVE TO INSTRUMENTALISE MORE WELLHEADS.” FAWAZ AHMED, REGIONAL SALES MANAGER, FRAMES.

has been imperative to instrumentalise more wellheads. The retirement of very experienced people has meant that decisions that used to be based on tribal knowledge are now being made using data in the context of an intelligent field.” Ahmed expresses a similar opinion as Al Ghamdi, saying, “Final investment decisions are delayed due to current market situation, and new projects are not being developed. We recognise that oil producing companies rely on their existing assets. We believe for every marginal or mature field, there is a cost-effective solution to maximise the profits.” He concludes, “Frames can help oil producing companies by de-bottlenecking the process equipment via installing skid-mounted add-ons, modifying existing equipment, or replacing the entire sections.” arabianoilandgas.com

A SPECIAL REPORT INTO A KEY SEGMENT OF THE REGIONAL UPSTREAM INDUSTRY

MARKET FOCUS An overview of the growing magnitude of Big Data in the regional oil and gas market/ p36

TECH FOCUS IOT IS FUELLING DIGITAL TRANSFORMATION /P40

KNOWLEDGE PARTNER

Franรงois Haynes of Intergraph PPM describes how Big Data is helping EPC contractors and operators / p38

SPECIAL REPORT

Oil & Gas Middle East takes an in-depth look at the Big Data market, as the amount of data being generated by upstream operators is proving to be beyond manual management

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EDITOR’S LETTER

Indrajit Sen is the deputy editor of Oil & Gas Middle East. He can be reached at: indrajit.sen@itp.com

There’s something Big in the works Big Data is making big promises to not just the oil and gas sector, by helping it manage its mammoth data and optimise operations, but also proving to be a boon for ICT companies

egional NOCs and oilfield services companies alike are thus resorting to Big Data to not just manage and channelise to good use the tremendous volume of data it is producing each moment, but also sees this IT concept as a means to achieve operational excellence in this subdued oil price era. The numbers are jaw-dropping: according a recent survey conducted by Cisco, oil and gas industry professionals believe that the concept of Internet of Everything (IoE) has the potential to automate 25%-50% of manual processes. As per the latest research report by Global Market Insights Inc, the global oil and gas analytics market size is expected to exceed $21 billion by 2024. According to a Micro Market Monitor report, the Middle East Big Data, business intelligence, and analytics market size is projected to grow from $5.09 billion in 2015 to $12.38 billion by 2020, at a CAGR of 19.4% from 2015 to 2020. According to Cisco Consulting Services, by transforming business processes through IoE, oil and gas companies globally can capture their share of $600 billion of Value at Stake between 2016 and 2025. For a $50 billion oil and gas firm, this translates into an 11% bottom-line (EBIT) improvement. However, it might be interesting to note that while Big Data and analytics may be new to some industries, the oil and gas industry has long been dealing with mammoth quantities of data to make technical decisions. In their quest to learn what lies below the surface and how to draw it out,

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SEIZE THE SPECIAL REPORT PLATFORM

Oil and gas sector needs Big Data for monitoring.

energy companies have, for many years, invested in seismic software, visualisation tools and other digital technologies. Now, the rise of pervasive computing devices — affordable sensors that collect and transmit data — as well as new analytic tools and advanced storage capabilities are opening more possibilities every year. For example, they can pair real-time downhole drilling data with production data of nearby wells to help adapt their drilling strategy. Oil and gas companies essentially need Big Data to monitor operations, streamline processes, lower risks to workers and prevent disasters. These companies are deluged with data generated by a multitude of sensors and machines spread throughout their far-flung value chain. Internet of Things solutions are important for the oil and gas industry in that it allows oil and gas companies to manage and gather data from operations in remote environments while eliminating the need for workers in these environments.

hen we at ITP Media Group launched the Special Reports initiative last year, the prime idea behind it was a realisation that industry players at times need something beyond advertisements to showcase and promote their work, products/technologies or achievements. An artwork in a magazine may not necessarily detail the tremendous effort that a company has put to develop a certain innovative product or an efficient technology that has brought great benefits to a client’s project. Special Reports - which we fondly describe as a ‘magazine within a magazine’ - thus are a platform for you to collaborate with Oil & Gas Middle East to reach out to every corner of the wider industry you have been wanting to reach for so long. It is an opportunity that will provide that invaluable editorial highlight to your company’s sterling work - something it genuinely deserves. By entering into a commercial arrangement with us to become a Knowledge Partner, you choose to have your company exalted to great heights before the regional industry. During the course of the year, we will be producing a number of Special Reports about key topics - subjects that will resonate key issues within the industry (and even beyond) - and I hope there will be a Report relevant to and concerning every company. Next month for the February edition, the Special Report is going to be on Pipeline Management. In this Report Oil & Gas Middle East will shed light on how crucial pipeline management is for regional upstream operators and how service providers are helping their clientele maintain pipeline integrity through various technologies. We invite you to be a part of this campaign and seize the opportunity to reach out to our ever growing readership.

JANUARY 2017

MARKET FOCUS

Regional Big Data growing in magnitude According to a report published in 2016, the Big Data, Business Intelligence and Analytics market in the Middle East is expected to grow from $5.09bn in 2015 to $12.38bn by 2020, at a CAGR of 19.4% WORDS: INDRAJIT SEN

he low oil price period and the resulting investment reductions and stops have developed a focus on improving the efficiency of existing facilities to enable operators and EPC contractors to stay competitive. It is becoming evident that a major focus for everyone involved must be the minimisation of overheads and having an even sharper focus on productivity. Less CAPEX investment on projects also means that the existing assets need to be operated for

longer, or their production capacity needs to be increased. This results in more changes during the asset life cycle and requires more velocity for processing Big Data. One approach to increasing efficiency and velocity can be through the use of better technology in conjunction with a clear plant information management strategy to be able to manage the virtual representation of the physical facility. According to a 2016 report by Research and Markets, the Big Data, Business Intelligence and Analytics

Like other industries, oil and gas companies are continuing to invest in Big Data and new datamanagement technologies.

JANUARY 2017

market in the Middle East is expected to grow from $5.09 billion in 2015 to $12.38 billion by 2020, at a CAGR of 19.4%. â&#x20AC;&#x153;The oil and gas market is one of the huge demand drivers for big data and analytics,â&#x20AC;? Benoit Dubarle, president - Gulf countries and Pakistan, at Schneider Electric, says. It has been a standard practice for oil and gas majors to measure their value in oil reserves. Over the past several years it was possible to ensure facilities becoming more profitable by means of new exploration technologies and innovative ways of extracting oil, such as drilling not just vertically but also horizontally. At the same time, increased attention should be paid on the value of asset information. The way data is being used can also have a major impact on the feasibility of developing assets viably. Oil and gas companies can benefit not only from deploying these types of new digital plant technologies such as enhancing safety procedures, or automating manual and paper-based processes, but also from integrating new and existing technologies. Integrating virtual asset data with real time data to bring more reactivity during asset operation is another opportunity in the Big Data domain. Independent market researches, including ARC Advisory Group, published a study about the need for developing an Asset Information Management Strategy in 2010. Their findings showed that not managing asset arabianoilandgas.com

MARKET FOCUS

information properly can result in an annual loss of 1.5% of the annual sales of an asset per year. Today, according to ARC Advisory Group, the global process industry loses $20bn annually due to unplanned downtime. “Worse: most – more than 80% – of plant failures are not even detectable by current preventive age and wear based maintenance practices (Source: ARC, Proactive Asset Management with IIoT and Analytics, 2015),” Luc Chantepy, regional sales vice president – MENA at AspenTech, says. “Most assets display a random failure pattern, and these symptombased failures are only addressable via predictive and prescriptive analytic approaches.” “We see strong interest in addressing the previously unsolvable challenges of low asset availability, unplanned downtime and process

disruptions. Companies will be forced to tackle these problems in an increasingly competitive global manufacturing environment with ever-changing supply and demand patterns that call for ever-higher levels of operational excellence,” Chantepy continues. “The industry will adopt a simpler, easier-to-deploy and –use, more accurate 21st century data-driven approach to improve plant reliability because traditional approaches to maintenance will not drive the performance improvements needed in the future.” Like other industries, oil and gas companies are continuing to invest in big data. This includes new datamanagement technologies (such as Hadoop), new solution architectures (such as data lakes and logical data warehouses) as well as new productivity platforms.

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JANUARY 2017

KNOWLEDGE PARTNER

THE ‘SMART’ WAY TO INTEGRATE OPERATIONS The ‘SmartPlant Fusion’ engineering information management system developed by Intergraph Process, Power & Marine is helping EPC contractors and operators alike capture, organise, link and visualise data. François Haynes describes how. INTERVIEW: INDRAJIT SEN

Give me an idea of your oil and gas clientele in the region and your scope of work with those companies. Intergraph Process, Power & Marine has a strong global customer base including most of the big EPC and OO (Owner-Operator) companies worldwide, and we have performed a number of successful project implementations, including in the Middle East region with companies such as Saudi Aramco, Petroleum Development Oman, KNPC, ADNOC Group companies and Petrofac. ARC Advisory Group has ranked Intergraph PP&M as the No1 Overall Worldwide Provider of Engineering Design Tools for Plant Design for ten consecutive years, also for the oil and gas industry. Elaborate on the work your company does in the Big Data domain, in particular

reference to the oil and gas industry? We want to give to our customers the capability to increase efficiency and velocity to process Big Data. One way will be to reduce the ratio of unstructured information. Accessing and navigating Big Data is another area where we want to provide value to our customers. Working with Big Data and sharing it independently of the physical by moving the Big Data into the Cloud is another key strategy we use to help our customers to create value. Last but not least, we want to give our customers the capability to bring their Big Data on the field to increase operation and decision making efficiency. Indeed, mobile technology and augmented reality will make the Big Data light and easy to use on day-today basis, driving operation efficiency on a level never seen before.

Could you talk about a specific product that your company might have developed in the Big Data space that would help or is helping oil and gas sector companies? In the unstructured Big Data area, Intergraph SmartPlant Fusion, our engineering information management solution for capturing, organising, linking, and visualising data allows users to ‘unlock’ information

THE ONLY BPA AUDITED ENERGY TITLE IN THE MIDDLE EAST JANUARY 2017

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KNOWLEDGE PARTNER

“WE WANT TO GIVE TO OUR CUSTOMERS THE CAPABILITY TO INCREASE EFFICIENCY AND VELOCITY TO PROCESS BIG DATA. ONE WAY WILL BE TO REDUCE THE RATIO OF UNSTRUCTURED INFORMATION, AS WELL AS ACCESSING AND NAVIGATING BIG DATA.” from documents and drawings. SmartPlant Fusion also extracts information from 3D models, TruViews and other databases and lists as well as creates an interdisciplinary view portal to the plant information. Bringing all this information together allows to report on the quality of the information and to see if the data is consistent and complete. Regarding accessibility of Big Data, Intergraph SmartPlant Enterprise Portal will give the capability to navigate inside the information, from tags to documents or to 3D models, and to find the information quickly independent of the size of the big data. By making Big Data ready for change, The SmartPlant Enterprise suite of solutions supports the whole plant life cycle, during which both EPCs and OOs can greatly benefit from managing their asset information. SmartPlant Enteprise enables an integrated project delivery through applying a rule-based philosophy that empowers EPCs to comprehensively master their work processes within the system. It simultaneously enables powerful intelligent design, project customisation, and change management with integrated, out-of-the-box solutions.

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For OOs, SmartPlant Enterprise offers templates based on unique and pre-configured owner operator work processes. Furthermore, it allows an integration with other leading third-party OO systems for maintenance, reliability, etc, and provides data exchange with contractors and suppliers, capturing unstructured information, validation, transformation, and loading of data exchanged to facilitate project execution throughout the project value chain. Moving the Big Data into the Cloud will facilitate the following: • Reduced capital expenditure: The money that would have been spent on buying, maintaining and upgrading infrastructure can instead be reserved for investment in resource-producing assets. • Faster project start-up: A project environment can be up and running in weeks, rather than months. • Improved collaboration: All project participants have easy access to relevant data, reducing rework between the project phase and handover. • Procurement, construction, and operations advantages: Cloud provides better opportu-

François Haynes, executive director Services & Business Development MEIA region, Intergraph Process, Power & Marine.

nity for greater material consolidation and construction sequence planning, and more effective and timely operations training. • Smoother project handover: Every engineering company has its own system and standards, which are not necessarily compatible with that of the plant owner’s. This can cause immense issues at the handover stage and through operations and maintenance. We can already bring Big Data on the field with the SmartPlant for Owner-Operators mobile solutions. These enable bringing documents and 3D models to the field, or help to support dedicated workflows, such as inspection or commissioning. Augmented reality is also knocking the door, demonstrable prototypes are already available and formal products will be released on the market in the coming months.

JANUARY 2017

TECHNOLOGY FOCUS

COPING WITH THE ‘BIG’ CHANGES IN THE SECTOR

With more than 2.5 quintillion bytes of data produced from internet users per day, Big Data can help organisations make better informed business and technical decisions WORDS: YASMIN HELAL

n today’s digitally driven enterprises, Big Data will be a huge benefit for the oil and gas industry, especially at a time of resource scarcity. Big data refers to the massive quantities of raw data generated by informational technology. In fact, according to technology company IBM, more than 2.5 quintillion bytes of data is produced from internet users in 24 hours alone. Decoding these using analytics software can help organisations make better business and technical decisions. For instance, in the oil and gas sector, the remote assistance in pipelines, prediction and mitigation of risks based on trend studies, and allocation of resources upstream and downstream, help oilfield operators become efficient. If leveraged and understood properly, Big Data

holds the key to sustainability. Luc Chantepy, regional sales vice president, AspenTech, explains that “Big data enables better, faster decisions. With the ability to make better design decisions, reliability improvement decisions, capital spending decisions as well as quantify future operational scenarios, oil and gas companies worldwide are interested in how Big Data will help their assets break down less. Longer lasting assets and lower maintenance costs are attractive, but the main motivation is that the net production output of the process increases dramatically when plant reliability is improved.” According to a Gartner 2016 survey, the investment focus is shifting from Big Data itself to building organisational capabilities to

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JANUARY 2017

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TECHNOLOGY FOCUS

It has become critical for energy ﬁrms to use data analytics for real-time insights.

improve specific business areas and metrics. In this era of unstable oil and gas prices, energy firms in the region are more bullish about using Big Data analytics to provide full business visibility and to plan their long-term sustainable production. The business benefits are not theoretical. A recent report revealed that 92% of the region’s oil and gas projects are delayed and 70% are over budget. Thus, it has become critical for energy firms to use data analytics for real-time insights that cut costs, enhance operations, and the supply chain. This is particularly true for digital oilfields, which can use Big Data analytics to allow for more mobile workforces as well as better prediction of trends such as new drilling locations, supply and demand, and predictive maintenance. Predicting events ahead of time allows firms to take proactive actions to avoid asset performance issues, increasing reliability and availability throughout the asset’s lifecycle. The world of Big Data is changing. Businesses need to find effective ways to utilise the massive amounts of data being generated. The Internet of Things (IoT) is fuelling the digital transformation in the marketplace. Big Data is becoming increasingly pervasive across all industries, including the oil and gas sector, and data-driven companies are positioned to be successful disruptors. “With the rise of the Internet of Things Era,” says Tayfun Topkoc, managing director, SAP UAE, “The Middle East’s digital oilfields can harness innovations such as drones, robotics, and 3D-printing to enhance their business models and competitiveness. However, energy firms should not deploy Big Data analytics in isolation. Instead, it is vital for it to be a part of a wider digital transformation strategy, which also includes robust cyber security measures.” Mike Weston, vice president of Cisco Middle East, tells this magazine, “The ability to unlock hidden value within your data is vital to being competitive in today’s world. What you need is effective data management, data preparation, and analytics.” arabianoilandgas.com

UPCOMING SPECIAL FEATURES

FEBRUARY Oil & Gas Middle East’s February Special Report sheds light on how crucial pipeline management is for regional upstream operators and how service providers are helping their clientele maintain pipeline integrity through various technologies.

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LAST WORD

SECURING BIG DATA

While Big Data has helped oil and gas operators optimise operations, it has also exposed systems to cyberattacks. Leo Simonovich, director of Global Cyber Strategy and Product Development at Siemens talks about why companies need to strengthen their cyber defence Could you give me an idea as to how important cybersecurity is to the oil and gas industry? It is a top issue of the day. This wasn’t the case a few years ago, but the number of cyberattacks continues to grow - including both known and unknown attacks. And we know that operational technology has become a growing target, now comprising 30% of all cyberattacks. In this region, 50% of all cyberattacks are directed against the oil and gas industry. So it has a major impact on productivity, uptime, efficiency and safety.

What is your opinion of the recent Stuxnet virus attack on Aramco? What I say to customers is that the probability of a cyberattack is almost 100%. The only question is what are they going to do about it. On an average, the oil and gas player experiences two to three major cyberattacks a year. Above all, we believe in holistic cybersecurity – the need to prevent and respond to attacks. Siemens as a major industrial enterprise caters to a lot of segments – Big Data being a part of the offering. Does the onus also fall on you to combine that with cyber defence systems? For Siemens, cybersecurity is a strong part of our vision for digitalisation and intelligent infrastructure. We recognise that using a risk-based approach to managing cybersecurity is important. Connectivity to be able to achieve operational excellence, which is a key part of digitalisation, is also important. But that connectivity also enables you to have situational awareness. And the lower the level you can go into the asset, or equipment, the greater transparency you will have, and the more precise you can be in employing countermeasures. JANUARY 2017

Siemens’ Leo Simonovich.

A flipside to digitalisation is also that it is making systems vulnerable to cyberattacks, as the one witnessed by Aramco recently. What is your opinion on this and how would you convince your client to adopt cybersecurity measures? Yes, it is a key concern. Smarter infrastructure that takes advantage of software and the ‘Internet of Things’ can provide more points of entry for cyber attackers. I advise our customers to take a risk-based approach to build connectivity in blocks. Make sure you are connecting securely. We understand that at the top of the environment, it is not just about connecting two control centres, but also connecting those with pipelines and offshore facilities

to be able to perform remote monitoring, automation and optimisation, securely. We have designed systems to address all of that. We call these systems ‘blueprints.’ At a time when the oil and gas industry is heavily cutting down on CAPEX, how would you convince your clients to adopt cyber defence measures? If you look at the industry, one area where budgets have not stayed flat, or have even risen, is around cybersecurity. That means we don’t have to convince our customers that cybersecurity is an important issue they need to address. They already know this. They just need to understand what is mission critical.

“OPERATIONAL TECHNOLOGY HAS BECOME A GROWING TARGET, NOW COMPRISING 30% OF ALL CYBERATTACKS. IN THIS REGION, 50% OF ALL CYBERATTACKS ARE DIRECTED AGAINST THE OIL AND GAS INDUSTRY. SO IT HAS A MAJOR IMPACT ON PRODUCTIVITY.” arabianoilandgas.com

OMAN COUNTRY FOCUS

OMAN’S ENERGY SECTOR MAKES MODEST GAINS Oman’s reserves are significant enough to account for 90% of the government revenues, 70% of exports, and 50% of the GDP.

Invigorated by the OPEC/non-OPEC output cut deal – a positive development desperately needed by Oman – the Sultanate is hoping for a better new year in which it seeks to drive its oil and gas industry towards profitability, indulge in more innovative EOR projects, whilst leading the economy towards structured diversification WORDS: YASMIN HELAL

arabianoilandgas.com

ver the course of the ﬁrst ﬁve months of 2016, Oman’s oil revenue plunged by 44.7% to $3.34bn compared to the same period in 2015. It has been estimated by the World Bank that the Sultanate lost about $10bn in revenues in 2015 alone – an alarming loss that has prompted the Omanis to take urgent steps towards driving oil prices in order to boost the economy. During a visit to Abu Dhabi in early 2016, the Sultanate’s oil minister, Mohammed bin Hamad Al Ruhmy, told reporters, “Oman is ready to do any¬thing that would stabilise and improve the JANUARY 2017

OMAN COUNTRY FOCUS

market. At least, if OPEC and few non-OPEC [countries] chop 10% [of production], I think the problem is solved.” When OPEC and non-OPEC countries in Vienna in December reached an agreement to reduce output to prop up prices, Oman presumably displayed the utmost enthusiasm about the success of the talks. Along with Russia, it joined a monitoring committee set up by the OPEC to oversee the implementation of oil production cuts by adherents. According to Nizar Jichi, audit partner and oil & gas leader at KPMG Lower Gulf, said, “OPEC and non-OPEC members recently cut oil production by almost 1.8mn barrels a day. This has driven oil prices up by 15% reaching $55/barrel. We anticipate oil and gas companies will maintain current levels of operations until the year 2020.” “That being said, Oman oil and gas companies are advised to continue to focus on cost optimisation initiatives, lifting costs, and driving leaner operations. We anticipate oil prices will remain volatile for the foreseeable future, potentially increasing above current prices, but certainly not to the levels witnessed in the ﬁrst half of 2014,” Jichi told Oil & Gas Middle East. Even the (once angry) Omani workers and trade union leaders expressed optimism regarding the recent output cut deal. The chairman of the oil and gas trade unions, Saud Salmi, told the media shortly after the Vienna meeting, “We see a ray of

Mohammed bin Hamad Al Rumhy, Minister of Oil and Gas in Oman. Raoul Restucci, managing director of Petroleum Development of Oman. Robin Mills, Chief executive office of Qamar Energy.

JANUARY 2017

hope not only for the workers in the oil and gas sector, but also for those who are working in other sectors. If oil prices recover, firing can come to an end, existing projects can continue, new projects will come and moreover, workers can get real jobs.” During the downturn in the regional oil and gas industry, over 1,600 Omani oilfield workers have lost their jobs, sparking frustration among the affected. Leaders of trade unions, like Salmi, had anticipated this and the Oman Society of contractors (OSC) warned that up to 55,000 Omani construction workers risked losing their jobs if market conditions didn’t improve. Modest, yet significant, reserves Unlike its GCC neighbours, Oman has relatively modest oil reserves. Yet, the country’s reserves are significant enough to account for 90% of the government revenues, 70% of exports, and 50% of the GDP. arabianoilandgas.com

OMAN COUNTRY FOCUS

“OMAN HAS SEEN CONSIDERABLE INVESTMENT IN EOR TECHNOLOGIES TO PRODUCE HEAVY OIL AND NOW OTHERS IN THE MIDDLE EAST AND INDIA HAVE BEEN ENCOURAGED BY OMAN’S SUCCESS.” VINOD SHAH, MANAGING DIRECTOR, MOTT MACDONALD

Over 1,600 Omani oilfield workers have lost their jobs during the downturn.

It has been reported that Oman has 5.3bn barrels of estimated proven oil reserves, as of January 2016, meaning the country has the 7th largest proven oil reserves in the Middle East and 22nd in the world. State-owned Petroleum Development of Oman (PDO) holds more than 70% of Oman’s oil production. PDO itself is 60% owned by the government while Shell owns the other 34%, Total 4%, and Potugal’s Partex 2%. Oman’s production reached a record high rate of 1mn barrels per day in July last year, but a tweet from the ministry of oil and gas said, ‘Oman will cut oil production by 45,000 barrels a day, following an agreement reached by OPEC with independent producers outside the organisation’. The Sultanate’s total output will see a 4.5% reduction in January 2017. Difficult-to-recover hydrocarbons Because of its complex geological structure, Oman’s oil reserves have proven to be hard, and

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expensive, to recover. The reservoirs across the country are located at a depth of more than 5.5km, far deeper than elsewhere in the world. This natural difficulty (in part) has also traditionally caused Oman to produce less oil than its other oil producing counterparts; something that has led Oman to fervently adopt – perhaps more intensely than its GCC peers – Enhanced Oil Recovery (EOR) technologies to suit production requirements. In a 2012 interview with Oil & Gas Middle East, Vinod Shah, managing director at Mott MacDonald’s Oman office, said, “Output in the country’s maturing oilfields peaked in the 1990s and PDO, the Sultanate’s leading oil company, spearheaded the implementation of EOR techniques with its first trials in the late 1980s.” “Oman, in particular, has seen considerable investment in a range of EOR technologies to produce heavy oil and now a host of other countries in the Middle East and India have been encouraged by Oman’s success. Between 2001 and 2007, Oman’s oil production fell by 27%, but by 2009, due mostly to EOR projects, oil production had increased by 17%,” he added. Due to the innovative EOR technologies, production was back up on its feet by 2015. However, this reliance on technology makes production in the Sultanate a costly business. Shell and several other partners invested more than $25mn in solar-powered EOR process in Oman in 2012. Such projects are expected to generate significant leads and the government said it expects 16% of its oil production came from EOR projects by 2016, in contrast with 3% in 2012. So far, Block 6, which accounts for up to 70% of the country’s oil production, has been the centre of the Sultanate’s EOR technologies. Here, polymer techniques have been used in the Marmul field, miscible in Harweel field, steam technology in Qarn Alam field, and the GlassPoint-commissioned solar-powered EOR project in Amal-West oilfield. JANUARY 2017

OMAN COUNTRY FOCUS

Oman aims to diversify its economy and reduce its dependency on oil.

“Oman’s complex and often challenging geology makes embracing new ideas and cutting-edge technologies an essential requirement of any oil and gas company wishing to operate in the Sultanate,” Raoul Restucci, managing director of PDO, said in an interview with O&GME last year. He also added that PDO is testing, reviewing, or piloting between 50-70 technologies at any given time. “It is important to highlight that our focus is less about technology development and more about proﬁcient and widespread deployment.” Based on this reliance on expensive EOR technologies and the expenses that this entails, the most effective model that the government created was to offer generous incentives to international oil companies (IOCs). Such attractive contract terms offered to international partners has made E&P in Oman a more favourable option compared to other countries in the region. One of the largest foreign operators in the Sultanate is Occidental, while others include Shell, BP, Total, Japan’s Mitsui, China’s CNPC, Sweden’s Tethys Oil, and Canada’s Gulfstream Resources.

$330BN

THE VALUE OF CONTRACTS THAT PDO AWARDED TO LOCAL OMANI SMES IN OCTOBER 2016.

JANUARY 2017

Diversification and localisation A national strategy that Oman shares with its neighbouring GCC countries is that it aims to diversify its economy and reduce dependency on oil. Being one of the hardest hit in the region by the dip in oil prices, the government wants to ensure the sustainability and development of other sectors. As a result, the government in Muscat has been trying to increase investments in non-oil sectors, while struggling with fiscal reform. With these goals in mind, Oman plans to cut oil and gas expenditure by 14%, from $36.6bn to $30.9bn. Some of the driving forces behind sustainability include the In-Country Value (ICV) strategy. With the current dependence on foreign operators, it will take a while before Oman is self-sufficient. However, the government is already taking steps towards the right direction. “Public-private partnership has paid well and resulted in developing standard criteria for the In-Country-Value (ICV) for the oil companies tenders. The Ministry is considering implementing a number of important projects, including coordination with oil companies to implement an e-system for reporting ICVs by oil and gas sector,” oil minister Rumhy says. In October, PDO awarded three contracts worth $330mn to local Omani businesses. Under the terms of the deals, which will run for four years with options to extend the duration, earthworks will be carried out by local community contractor Najed al Ahliya at PDO fields at Fahud, Lekhwair and Yibal, as well as by Sarooj Construction Co at Qarn Alam and Saih Rawl. PDO, in a statement, has claimed that the contracts are further evidence of the success of its ICV strategy to build a thriving small and medium enterprise (SME) sector and retain more of the oil and gas industry’s wealth in Oman. “Oman has worked with IOCs, with PDO and with Oman Oil, a 100% state company, as well as offering small fields to other sub-contracting companies. Oman has worked hard to attract smaller companies too,” confirmed Robin Mills, CEO of arabianoilandgas.com

OMAN COUNTRY FOCUS

‘Omanisation’ is another point of focus for the government in order to sustainably diversify the economy.

Stuart Douglas, vice presidentMiddle East at Petrotechnics.

Qamar Energy, an exploration and production (E&P) consulting and investment advisory ﬁrm. As further evidence to its commitment to develop local content, PDO has signed another contract with the amount of $200mn with an Omani factory. According to the agreement, the Gulf International Pipe Industry (TMK-GIPI) mill, based in the Sohar Industrial Estate, will manufacture a variety of pipeline for PDO and other operators. ‘Omanisation’ is another point of focus for the government in order to sustainably diversify the economy. This will require the Sultanate to further look inwards, invest and develop local talent. Enhancing areas like science, technology, engineering and mathematics (STEM) will feed the entrepreneurial spirit required to strengthen the SMEs sector. Fuelling optimisation Under the umbrella of ‘doing more with less’, which continues to dominate the oil and gas industry in the low oil price environment, operational excellence and cost efﬁciency have emerged as key factors to

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success, an element that PDO has embraced. The oil major has said that improved operational efficiencies and procurement savings on megaprojects is expected to save the company up to $1bn from 2016 to 2020. “Buoyed by a renewed focus on enhancing or maintaining productivity while reducing costs, operational excellence (OE) continues to be a hot topic in the Middle East oil and gas industry – and Oman is no different. The gap between the cost of production in Oman and global oil prices is wide enough for E&P companies to make a profit,” Stuart Douglas, vice president-Middle East at UK-based Petrotechnics, says. Speaking prior to ADIPEC 2016, the exploration director at PDO advised that Omani companies must seize the opportunity afforded by the current economic constraints to challenge the way they work, by focussing on core activities including safety, production and early monetisation. Douglas concludes, “One example of this approach working in action is the Mukhaizna field in Oman. However, Omani companies still must challenge the way they work in order to continue to succeed in the current economic climate.” JANUARY 2017

EXCLUSIVE INTERVIEW

WORDS: JAMES MORGAN (FOR CONSTRUCTION WEEK) PHOTOGRPAHY: AASIYA JAGADEESH

GO BIG OR GO HOME

Marc Heerink says Fluor’s experience on multibillion-dollar mega plants, coupled with its integrated ‘OneFluor’ strategy, will enable the EPC giant to maintain and grow its sizeable market share in the Middle East, regardless of the oil price

Marc Heerink, executive director for business development in the EAME region, Flour Energy and Chemicals.

JANUARY 2017

onsidered by many to be the energy capital of the world, the Middle East has built – and is continuing to develop – oil, gas, and petrochemical facilities on a grand scale. Highprofile construction projects, such as the UAE’s Expo 2020 site and Saudi Arabia’s Jeddah Tower, might garner the lion’s share of column inches, but their project spends pale in comparison to the region’s largest energy and chemical plants. This segment may maintain a relatively low profile, but it is the stomping ground of numerous industry giants. And make no mistake, Fluor is one of the biggest. In 2015, the US-headquartered engineering, procurement, and construction (EPC) outfit secured $21.8bn of new awards, and achieved revenue of $18.1bn. Fluor employs more than 60,000 people worldwide, 4,000 of whom (excluding Stork’s 1,400 regional employees) are based in the Middle East. At present, the firm is managing more than 14,000 construction workers across its regional project portfolio. Marc Heerink became Europe, Africa, and Middle East (EAME) executive director for business development within Fluor’s Energy and Chemicals division on 1 October, 2016. Speaking to Construction Week just weeks later, he seems impressively undaunted by the

scope of his new role. In fact, he is adamant that the magnitude and diversity of Fluor’s operations represents one of its greatest strengths. “Fluor has been active in the Middle East for a truly long time,” he begins. “We’ve enjoyed more than 65 years of continuous operations [in this region]. We have ofﬁces in Saudi Arabia, Kuwait, Qatar and the UAE, and we’re active in the sectors of oil and gas, chemicals, power and infrastructure, government services, mining and metals, life sciences and advanced manufacturing, and water and wastewater. This [diversity] is a key driver for Fluor; we call it our OneFluor strategy. We have multiple businesses, and the good thing about that is that if one goes through a bit of a trough, others will thrive. Being a diversiﬁed company is the core of our strategy.” arabianoilandgas.com

EXCLUSIVE INTERVIEW

SOMETHING FOR EVERYONE The diversity of Fluor’s operations is certainly advantageous in terms of weathering market fluctuations, but it also benefits the company’s regional clients. “OneFluor enables us to bring all of our businesses together,” explains Heerink. “Mega complexes require water treatment plants, accommodation camps, and other facilities. “Fluor is equipped, not only to deliver mega plants, but also all of their associated infrastructure and facilities,” he adds. Fluor subsidiary, Ameco, is one example of this holistic approach. Heerink continues: “Ameco provides tools, fleet, and other services for construction companies. Fluor tries to bring Ameco in to offer construction support. Temporary facilities form a huge part of our projects, so we try to provide this expertise [in house]. “What’s more, Fluor is not only diversified in terms of its business lines or the regions in which it works; it’s also diversified in terms of where it plays in a project – from the initial concept studies, all the way through to front-end engineering design (FEED); engineering, procurement, and construction (EPC); commissioning, and so on.” Heerink adds that by providing these capabilities directly – and thus minimising the number of thirdparty interfaces – Fluor is able to provide better service for clients, while maximising its revenue streams. “We’ve found that this strategy hugely increases cost and schedule certainty,” he concludes.

Fluor recorded a revenue of $18.1bn in 2015.

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Fluor arrived in the Middle East in 1947, upon winning an award from Aramco – now Saudi Aramco – to expand a major oil and gas facility in the kingdom. In the years since, the company has completed approximately 600 projects in the region, with a combined value of more than $150bn in today’s money. This is an undeniably strong heritage, but the past two years have seen the price of oil fall dramatically, from more than $110 per barrel in 2014 to approximately $45 today. Diversiﬁed though its operations may be, one may expect Fluor’s Middle East businesses to have been adversely impacted during this period. However, when asked about the ﬁrm’s recent regional performance, Heerink is surprisingly upbeat. “Business has been good for Fluor in the Middle East; we’ve enjoyed a number of very success-

ful [contract] wins,” he explains. “In Kuwait, for instance, we are working on Kuwait National Petroleum Company’s (KNPC) Clean Fuel Project (CFP), awarded in 2014; and the Al-Zour Refinery Project, awarded in 2015. “We’ve also been active in the mining sector. About a year ago, we finished a large-scale aluminium project on behalf of the Ma’aden-Alcoa joint venture (JV) in Saudi Arabia. This was a $10.8bn (SAR40.5bn) programme, with various scopes of work, including a bauxite mine, an alumina refinery, an aluminium smelter, and a rolling mill. Fluor executed front-end engineering design (FEED); engineering, procurement, and construction management (EPCM); and project management consultancy (PMC).” In the kingdom, Heerink and his team are supporting a $2.7bn (SAR10.13bn) facility on JANUARY 2017

EXCLUSIVE INTERVIEW

Flour is supporting a number of Qatar’s large oil and gas players, including the Qatargas Operating Company.

behalf of Saudi Aramco-Dow Chemical Company JV, Sadara Chemical Company. This contract involves the world’s largest single-phase development for a chemicals facility. Fluor’s historic GCC energy projects include the front-end engineering package for the UAE’s Shah Gas Development; Qatargas Operating Company’s Berth 6 Project in Ras Laffan, Qatar; and FEED services for Qatar Petroleum (QP) and Shell Global Solutions’ Al-Karaana Petrochemical Project. Fluor is also active on a selection of regional infrastructure developments, such as the Saudi Landbridge Project and King Abdulaziz University (KAU); and government projects for clients like the US Air Force Center for Engineering and the Environment, and the US Army. Though Heerink concedes that Fluor’s experience on multibillion-dollar mega plants is commercially advantageous when it comes to winning new work, he also emphasises that his team is not solely focussed on large-scale developments. “The ability to deliver megaprojects is a distinct differentiator for Fluor,” he explains. “So yes, clients choose Fluor to support multibillion-dollar projects

“FLUOR HAS GROWN AN EXTREMELY STRONG PROCUREMENT CAPABILITY. WE ARE BUYING APPROXIMATELY $16BN WORTH OF MATERIALS, EQUIPMENT, AND SERVICES ON AN ANNUAL BASIS.”

JANUARY 2017

for a speciﬁc reason; that’s what we’re known for in the market. Nevertheless, we are supporting a whole range of projects in the Middle East, starting from conceptual work, right up to operations and maintenance. These are projects of all sizes. We might be best known for our work on mega- and even gigaprojects, but we are also working on developments with investments [of less than $10m].” When Heerink says that Fluor is performing well in the Middle East, he is not suggesting that the regional downturn has had no effect on the region’s construction or infrastructure segments. Instead, he argues that, owing to his employer’s historic strategic decisions, his team is succeeding in winning a larger share of a smaller market. “We too see a market in the Middle East that has come down signiﬁcantly,” he elaborates. “However, throughout the down cycle, we’ve been operating in a good manner. So sure, we see a market with fewer opportunities ahead, and it’s going to take all of our diligence to deal with that. But I don’t foresee a lower level of activity for Fluor; just fewer prospects. What does that mean? It means that we need to win a higher percentage of work because we don’t want to see our activity decreasing.” And this, according to Heerink, is why the OneFluor strategy has been – and will continue to be – so important for his team’s Middle East operations. Essentially, Fluor has made a series of investments, and entered into numerous collaborations, to ensure that it can offer a comprehensive suite of services to its clients. “A market that sees less opportunity and, therefore, more competition, has actually forced us to reconsider the way in which we execute and win projects,” says Heerink. “With this in mind, we’ve rolled out strategies that form part of, what we call, our integrated solution. “For instance, Fluor has grown an extremely strong procurement capability. We are buying approximately $16bn worth of materials, equipment, and services on an annual basis. And arabianoilandgas.com

EXCLUSIVE INTERVIEW

Marc Heerink emphasises that Fluor is not solely focussed on large-scale developments, but a whole range of projects.

through these activities, we know very well how to buy in China and India and, indeed, across the world. In a number of locations, we’ve established self-perform construction and fabrication capabilities; we’re increasingly using modularisation. “For example, in 2015, Fluor formed a new JV with COOEC, called COOEC Fluor Heavy Industries Co Ltd (CFHI). Through this partnership, both stakeholders will own, operate, and manage the Zhuhai Fabrication Yard in China’s Guangdong Province. This collaboration will result in one of the world’s largest fabrication yards for onshore

and offshore modules. Fluor holds 49% ownership in the JV, whereas COOEC has a 51% stake. “This integrated strategy means that, wherever we have the capability, we can control the entire engineering, procurement, fabrication, and construction (EPFC) process, in addition to FEED. To remain competitive and win a larger market share, we’ve had to come up with smart ways of designing and delivering plants.” In terms of Heerink’s personal priorities for Fluor’s operations in the Middle East, he is conﬁdent that he has assumed the responsibilities of EAME executive director at an opportune juncture for the company. “My main priority is to work with the Fluor team, and guide the company through a period of lower [market] activity,” he explains. “This will mean [pushing ahead] with the smart [corporate] approaches that we’ve been developing over the past few years: the integrated solutions and the OneFluor strategies.” Heerink concludes: “Fluor has always been a company with good foresight. We invested in our operations before the difﬁcult times arrived and, for that reason, so far, we’ve come through this downturn in a very good way. And now, because of the pre-investments that we made, we’re very well positioned to continue operating in an effective manner.”

SAFETY FIRST, AND THROUGHOUT Safety, Heerink tells Construction Week, is a priority for Fluor, regardless of geography. He says that effective site safety involves three underlying pillars: culture, procedures, and tools. “You must start with a strong safety culture,” he explains. “Then, you need to implement strong safety systems and procedures to roll it out, and provide the right tools.” Heerink also says that health and safety cannot be confined to the construction site. In his opinion, senior management figures have

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a responsibility to demonstrate their commitment to best practice. “[Senior] figures must show an interest, and demonstrate their passion for health and safety,” he emphasises. “Project directors and clients, for example, should conduct site walks to show the commitment they have to safety. That’s what I mean when I say that the best-run companies have a strong safety culture.” And this culture, Heerink continues, is even more pertinent within the Middle East market. He concludes:

“In this region, you have some interesting challenges, because you have very diverse workforces. They include locals, and [expats] provided by agents. So you need a very

strong safety culture. Fluor’s safety results in the Middle East are absolutely top of the class. We’re very proud of that, because it takes a lot of hard work and commitment.”

JANUARY 2017

PRODUCTS & SERVICES

INDUSTRY INNOVATIONS Emergency tow rope cutter ROPE CUTTER Hydraulic cutting systems spe-

cialist, Webtool, has developed a portable, emergency tow rope cutter for oil tankers eliminating the risk of the pull-back tug capsising. Attached to the steel wire tow line on the tanker’s poop deck, the Webtool deck cutter, once activated, cuts a 60-70mm steel wire tow line within 3 seconds to prevent tug capsise. Ahead of single point mooring (SPM) ofﬂoading, the cutter is deployed to the tanker. It comprises two portable units: a cutter and hydraulic power source.

N E W L A U N C H ES

A round-up of some of the best releases this month

PORTABLE GAS ANALYSER Ametek Land, an industrial combustion efficiency and environmental pollution emissions monitoring specialist, has made its Lancom 4 Portable Gas Analyser

RISK REDUCTION WITH TRANSIT DESIGNER Sweden-based provider of modular-based cable

PERSONALISED FILTRATION PLANS Clarcor Industrial Air’s insight into how filtration

affordable with a Euro price reduction following Britain’s vote

and pipe seals Roxtec has launched Roxtec Transit Designer 4.0, a web-based tool that helps designers and engineers take control of the issue of securing vital safety

to exit the European Union. The analyser is able to monitor up to nine different gases and a total of 17 measurement

components such as cable and pipe transits. The design tool simplifies the entire process that surrounds cable and pipe

best decision for their installation and, ultimately, operation’s

parameters using a single instrument, and it has the ability to data log up to 250,000 records. Widely used across indus-

routing and provides full documentation. The latest improvements in Roxtec Transit Designer include a product

process and is focussed on what customers want from their installation rather than trying to push a particular technology.

tries, the Lancom 4 analyser is renowned for its convenience

selector, the feature to search on specific certification

Clients first discuss the conditions of their plant with a

and ease of use. A user simply switches on the analyser, allowing it to complete an automatic zero calibration,

requirements and the complete tailor-made documentation that comes with each solution. It generates everything from

and it is ready for use.

certifications to installation instructions.

qualified Clarcor representative. An engineering team then carries out a detailed analysis of the environmental and operational factors specific to the turbine.

JANUARY 2017

and media properties affect gas turbine output and performance has led it to introduce in the market Personalised Filtration Plans, customised solutions that will help make the profitability. Each Plan is developed through a five-step

arabianoilandgas.com

PRODUCTS & SERVICES

Emerson grows Iraq support facility

THREE REASONS TO BUY

Schneider Electric launches high-end Modicon M580 ePAC with native Ethernet across the Gulf region for industrial and infrastructure customers

The company moves to a new, larger facility in North Rumaila to better serve its customers

SUPPORT FACILITIES Emerson has ofﬁcially opened

its expanded facility in North Rumaila, Iraq. The company moved from its existing facility in Albradheya, Basrah to the new facility to increase its capabilities and address the needs of its continuously expanding installed base. The Al Majal facility will serve as a focal point of Emerson’s sales, project execution, lifecycle services, and educational services in Iraq. It is located in Iraq’s Oilfield Protection Force (OPF) area, in the middle of all major oil fields in the country such as Majnoon, West Qurna and Rumaila, allowing Emerson to work closer to national and international oil companies operating in the region. The facility will house a team of 50 Iraqi national engineers, which could double over the next years as the business grows. The Emerson facility consists of offices, meeting spaces, and a demonstration & training room.

BUILT FOR SECURITY

The Modicon M580 ePAC provides the market with enhancements in cybersecurity through the Achilles™ Level 2 and ISA Certifications. Modicon M580 is now equipped with larger memory and processing capabilities, allowing new integrated functions to improve cybersecurity capabilities.

SUSTAINABLE EVOLUTION

Migration to the new Modicon M580 ePAC does not require a complete change of system thanks to the seamless, affordable step-by-step modernisation plans for existing Modicon Quantum and Modicon Premium platforms. It provides total flexibility for operational efficiency.

POWERFUL PERFORMANCE

M580 ePAC offers an affordable highavailability solution for midrange to high-end process applications, providing hot standby CPUs and redundant power supplies. The product also maximises uptime with the capability for online configuration changes without stopping the process.

SELLING POWER

Pipework set-up and measurement software developer, mltech, has launched automet Lite into the market. Mike Lloyd, MD elaborates

arabianoilandgas.com

WHAT IS THE SALIENT FEATURE OF

HOW RELIABLE IS THE PRODUCT?

WHAT, AS PER YOU, IS THE SYSTEM’S

AUTOMET LITE? Used in conjunction with Leica iCON

Automet Lite provides quicker and more accurate results than traditional methods,

KEY BENEFIT? In a fabrication process that involves a

survey instruments, automet Lite has been developed due to the increasing demand

with no hand controllers required, giving

third party survey team, major overruns in cost and time are common. There is

for an affordable and accurate pipe spool

operators the ability to perform checks at any stage. This results in early detection

fabrication inspection system. Operated by one person, the system removes the

of non-conformity, preventing expensive repairs that could impact on cost and

fabrication inspection system to mitigate this, and the development of a new tool

involvement of a third party survey team.

delivery schedules at a later stage.

focussing in this area was essential.

high demand for an accurate pipe spool

JANUARY 2017

PRODUCTS & SERVICES

Honeywell bags automation project

ALSO IN STOCK

Honeywell Automation to control North Sea platform remotely from onshore

NEW CONTROLLER FROM ROCKWELL AUTOMATION GuardLogix 5370 controller provides integrated safety and motion

REMOTE CONTROLLING Honeywell Process Solutions has

HONEYWELL’S ROLE IN THE PROJECT:

announced it will provide advanced automation and safety solutions to enable remote onshore operation for an unmanned offshore platform in the North Sea, reducing overall production costs and improving safety. When drilling opera-tions are completed, Statoil’s Valemon platform, located on the Norwegian Continental Shelf, will become a periodically-manned installation and Statoil’s ﬁrst platform that will be operated from shore. Control operations will be located in Bergen, some 160km away from the platform itself. Moving personnel off the facility will improve the overall safety of the operations while also boosting efﬁciency by centralising the controls at the company’s Bergen location. Honeywell will serve as the engineering, procurement and construction automation contractor for the project.

• Honeywell will provide control and safety technologies for the project, including new operator stations and critical alarm panels at the onshore Bergen operations centre that will communicate with the systems on the Valemon platform, located 135m into the sea. • Once drilling is complete in 2017, the platform will have 10 production wells. • Among the number of technologies Honeywell will provide are its Experion® Process Knowledge System (PKS), integrated protective solutions, Critical Alarm Panel with Safety Manager, integrated fire and gas and

SEATRONICS SDM SYSTEM

emergency shutdown solutions, and closed circuit TV software.

P R O D U C T FO C U S Baker Hughes launches TRETOLITE SNAP ﬂuids separation technologies to help operators The technology enables SAGD producers to increase profitability by getting a more controlled oil/water interface that improves production volumes and capacity.

The chemical solutions include water clarification and demulsification technologies that deliver improved performance in multiple production applications.

Helps to more efficiently lower OIW and BS&W levels to ensure regulatory compliance and to minimise oil losses.

TRETOLITE SNAP technologies help minimise oil-in-water (OIW) levels to improve water quality for reuse.

WHERE CAN I BUY IT? For more information please contact Melanie Kania; call +1.713.879.1088, e-mail melanie.kania@bakerhughes.com.

JANUARY 2017

With the new Allen-Bradley Compact GuardLogix 5370 controller from Rockwell Automation, users no longer need separate networks and controllers for safety and motion in applications with up to 16 axes. This makes it easier to design safety into a wide range of standard and custom machines, and results in simpler system architectures. The Compact GuardLogix 5370 controller also helps users meet global safety standards.

Intertek offers cost savings through sample cylinder service Seatronics and Norwegian associates RTS have achieved 100 successful global installations with the Subsea Deflection Monitoring system (SDM). The SDM is a time-saving monitoring system used for the deployment and installation of subsea structures. Time-stamped data from pressure and attitude sensors are transmitted through an ROV hot stab connection or an acoustic modem. When installing the structure, the operator has full online feedback of its heading and deflection. arabianoilandgas.com

PRODUCTS & SERVICES

Emerson’s Operational Certainty

Emerson helps companies improve earnings by 15% and achieve performance

Aramco extends KBR’s contract KBR to provide FEED services in KSA FEED SERVICES KBR, Inc has an-

nounced that its Saudi JV engineering operation, KBR-AMCDE, has signed an amendment to extend its existing General Engineering Services Plus (GES+) Contract with Aramco. KBR will provide front-end engineering design (FEED), detailed design, material procurement, and project management services (PMS) to support Saudi Aramco’s capital programmes in KSA. EMERSON’S KEY FINDINGS – RATIONALE BEHIND LAUNCHING OPERATIONAL CERTAINTY: • In terms of safety, Top Quartile performers

as much on maintenance compared with

had one-third the number of safety

average performers and operate with an

incidents as compared to their average

incremental 15 days of available production

industry peers. • In terms of asset reliability, Emerson found that Top Quartile performers spend half

each year. • In the domain of production, Top Quartile manufacturers spent 20% less on

production-related expenses as compared to average producers. 25% of producers spent one-third as much as the industry average on energy costs and had 30% less CO2 emissions.

OPERATIONAL CERTAINTY As the oil and gas, petrochemical, reﬁning and other manufacturing

companies face mounting pressure to achieve improved financial results, Emerson has introduced Operational Certainty, a technology programme designed to help industrial companies achieve top performance and recover more than $1tn in operational losses globally. Emerson has introduced new peer benchmarking insights to bring better perspective on best practices and technologies to achieve top quartile performance in the areas of safety, reliability, production and energy management. The company has also launched a new Operational Certainty consulting practice plus expanded project execution methodologies and resources. To aid customers in establishing a path to top quartile performance, Emerson has started with Operational Certainty Workshops, consultant-led sessions that help customers pinpoint their causes of poor performance, prioritise actions that can yield the greatest improvement and establish a scalable work plan for achieving those results. Geostatistical evaluation in terms of gridding and others analyses generated highly accurate results especially on facies and property models. Roxar RMS software helps operators accelerate the field development planning cycle by allowing multiple disciplines to collaborate on a common reservoir model. The software also facilitates the implementation of the Big Loop™ solution, an automated workflow that tightly integrates static and dynamic domains to provide the greatest accuracy, the most comprehensive uncertainty assessment, and the best-quantified risk in the geologic model. Emerson’s Roxar RMS reservoir modelling software includes a variety of different modules covering well correlation, mapping, structural modelling, petrophysical modelling, local model updates, facies modelling, fracture modelling and uncertainty management. arabianoilandgas.com

• In the area of energy and emissions, the top

Frames delivers control panels Tecnimont Group and Total chose Frames CONTROL PANELS Services provider Frames has successfully completed and delivered six single wellhead control panels (WHCPs) for the Tempa Rossa oilfield. The contract of the WHCPs was assigned to Frames by the Italian provider of engineering and construction Maire Tecnimont Group. Tempa Rossa, an onshore field operated by Total, is located in the Basilicata region in the south of Italy.

JANUARY 2017

PEOPLE

ON THE MOVE William Mildon President Hydro Group Systems Inc

Subsea cable and connector specialist Hydro Group has announced the appointment of William Mildon as president of newly formed Hydro Group Systems Inc in California state. Boasting nearly 40 years of experience in undersea product development, Mildon has held a number of senior positions. His new role will be focussed on shaping and delivering the group’s vision.

named vice president of sales and marketing for Oseco. Kolbeck assisted with growth for two of the three Oseco business segments as director of marketing over the last 18 months. Last year, Kolbeck was integral to developing strategy for Oseco’s Fire Safety. He then shifted to a leadership role within the Chemical Processing sector , where he supported implementation of a new sales process.

Vice president of sales and marketing Oseco

Kevin Kolbeck has been

of the Month

managing director - Egypt Royal Dutch Shell

DT Global, a leading supplier of inline inspection (ILI) and data analysis, today announced the appointment of Andreas Haindl as CEO of the Middle East Operating Company. Haindl will be based in the Dubai ofﬁce which services the needs of customers in both Middle East and India. Andreas Haindl joined NDT Global in 2012 and was most recently responsible for managing the key account management function in Germany. Prior to joining NDT Global, he worked for 10 years in the telecommunications services industry, in senior account and programme management roles. Haindl received his Master in Engineering and Economics from the Karlsruhe University. Haindl is ably supported by the existing team at the Dubai ofﬁce including Ganesan Anandan, operations manager and Christian Openshaw, team leader account management.

Partner – Global Energy &

Squire Patton Boggs has appointed Neil Upton, one of Europe’s leading energy lawyers, to its global Energy & Natural Resources Practice Group in London. Upton joins the firm as partner, along with a six-strong legal

JOBS

NOTICE BOARD The latest jobs available in the oil and gas industry JANUARY 2017

and business development team, from King & Wood Mallesons in London, where he was the UK and Europe head, and global co-head, of the energy and infrastructure and project finance practice.Upton’s global practice is focussed on advising utilities, banks and other financial institutions, governments and NGOs.

Gasser Hanter

Neil Upton

Appointment

Chief executive officer for Middle East NDT Global

Upstream vice-president and

Natural Resources practice Group Squire Patton Boggs

Kevin Kolbeck

Andreas Haindl

Royal Dutch Shell has appointed Gasser Hanter to head its Egypt business, the Anglo-Dutch energy giant has announced. Hanter, who is Egyptian, was named as upstream vice-president and managing director in Egypt. He replaces Aidan Murphy, who has taken on a new role at Shell headquarters.

HALLIBURTON, MUSCAT, OMAN Lead accountant The candidate must assist in the development of financial and accounting systems, processes, policies, and procedures. S/he is required to possess a degree in accounting and a minimum of 5 years of experience in accounting.

QATARGAS, DOHA, QATAR Plant safety officer The key task of the plant safety officer is to ensure that safety equipment and facilities are kept in working order, which should be done by developing and implementing preventive maintenance programmes and associated procedures.

TXM LABOUR SUPPLY, ABU DHABI Islands instrument team leader The candidate will have to lead and manage the islands instrument team, planing, coordinating and supervising maintenance activities to ensure support is provided and that equipment are maintained at high degree of reliability. arabianoilandgas.com

PEOPLE

Trump picks ExxonMobil chairman Tillerson for US Secretary of State NATIONAL ROLE US President-elect Donald Trump has picked ExxonMobil CEO Rex W Tillerson to be his administration’s Secretary of State, which entails leading America’s diplomatic affairs. His experience at the head of the company has brought him into contact with a number of world leaders, including that of Russian President Vladimir Putin. Tillerson is take over charge from John Kerry and will face a number of pressing issues such as the nuclear agreement between the global community - led by the US - and Iran, the situation in the Middle East and relations with Russia. Tillerson has no governmental or diplomatic experience, but has extensive experience dealing with world leaders through his career at ExxonMobil. Tillerson ﬁrst joined Exxon in 1975. He was promoted to president and director in 2004, and was named CEO two years later. Over the course of his career, he worked to oversee Exxon’s operations in Russia and the Caspian Sea.

CAREER

NEWS

DARREN WOODS, PREVIOUSLY HEAD OF EXXONMOBIL’S REFINING BUSINESS, HAS BEEN CHOSEN BY THE COMPANY’S BOARD TO SUCCEED TILLERSON AS CEO. 57

PwC appoints two partners to global energy leadership roles

Simmons Edeco promotes Hunt to European operations manager

ENERGY LEADERSHIP Reid Morrison has been named as PwC’s Global Energy Advisory Leader and Kenny Hawsey will lead the Global Energy Tax practice. Morrison joined PwC as a principal in 2010, as the US Energy Advisory leader. He advises clients on strategies and initiatives to improve operational and commercial performance. In his new global role, Morrison will lead PwC’s energy advisory practice of over 1,500 professionals worldwide. Prior to PwC, Reid led the Global Energy & Chemicals practice at BearingPoint and Heidrick & Struggles. Kenny Hawsey joined PwC in 1990, and has over 25 years of US and international tax experience working with multinational corporations in the oil and gas industry. Most recently, Hawsey was the US Energy Tax Leader for PwC, after a two-year overseas assignment in the Middle East.

PROMOTION Services and equipment provider Simmons Edeco has announced the promotion of Mark Hunt to the newly created position of Operations Manager for Europe operations in Great Yarmouth, England. In his new role, Hunt is responsible for overseeing the strategic development of operations initiatives. In view of the company’s recent reorganisation that involves plans to expand globally, Hunt is reviewing existing processes with a view to standardising and strengthening operations. “By streamlining our processes, it will pave the way for setting up and operating remotely in other locations, as we do here in Great Yarmouth,” said Hunt. With 31 years in the oil and gas industry, Hunt has a solid background in operations, with particular emphasis on project management and mechanical engineering.

arabianoilandgas.com

JANUARY 2017

OPINION

SAUDI POWER

The Black Swans of KSA’s Vision 2030 Saudi Arabia’s transformation plan has forced the socio-economic and climate change policies to be interwoven, creating significant challenges for the power sector “KSA’S CONSUMPTION OF OIL AND GAS IS GROWING AT AROUND 7% PER YEAR AND DEMAND FOR POWER IS ESPECIALLY HIGH DURING THE HOT SUMMER MONTHS.” 58

About the author: Francis Patalong is a senior associate at the Corporate and Commercial department at Al Tamimi & Co.

uring the global ﬁnancial crisis it became fashionable to identify the so-called ‘Black Swans’, events that apparently came from nowhere [often] with devastating effect, though in retrospect they were hiding in plain sight. There are two ‘Black Swans’ which have implications for Vision 2030, Saudi Arabia’s 15-year plan to wean itself from its current dependency on oil revenues. These have forced the country’s socio-economic and climate change policies to be interwoven, creating signiﬁcant, but not insurmountable challenges for the power sector. Black Swan 1: The oil paradox The title of the 2011 Chatham House report, “Burning Oil to Keep Cool”, captures the essence of a basic problem. It estimates that Saudi Arabia’s consumption of its own oil and gas is growing at around 7% per year and demand for power is

JANUARY 2017

especially high during the summer months, as air-conditioning units run at maximum capacity for extended periods. Desalinated water production is also a very significant domestic consumer of hydrocarbons. Heavily subsidised power and water have been part of the social compact in Saudi Arabia for decades. Both cool air and portable water are funded by exporting oil resources, the Kingdom’s primary source of revenue. Those abroad who fill their tanks with Saudi oil have therefore, albeit indirectly, been funding this compact. At the same time, those oil-importing countries have enjoyed the significant benefit of exporting into the Saudi market. The downside of that position is a lack of private secarabianoilandgas.com

OPINION

tor employment in the Kingdom itself, one of the key challenges which the Vision is intended to address, with a planned 6mn additional jobs by 2030 and a particular emphasis on education reform. Moving to anything approaching costreflective tariffs for electricity and water is likely to be a painful, but ultimately necessary adjustment, if the value in the primary asset of the Kingdom is to be realised and invested, and not dissipated in its own domestic market. Black Swan 2: Climate change The global temperature for February 2016 was far above the long-term average, causing shock among climate observers. March 2016 set a new record temperature for that time of year, according to NASA’s Goddard Institute for Space Studies. The global temperature was 1.28oC warmer than the average for March from 1951 to 1980, which is used as a baseline. Recently, the world’s two biggest-emitting nations have formally ratified the UN Paris Agreement on climate change, making it likely that the treaty, which will establish a new international carbon trading mechanism after 2020, will enter into force this year. The clear message is that the longer we wait, the more expensive it will be to mitigate the effects of climate change. The next landmark report from the UN climate science panel, due to come out in three stages between 2020 and 2022, will look more closely at policies for managing this challenge, and will have profound implications for Saudi Arabia. The Intended Nationally Determined Contribution (“INDC”) of Saudi Arabia under the United Nations Framework Convention on Climate Change (“UNFCCC”) identifies two development baseline scenarios, one reliant on heavy industrialisation, which seems less likely; and the other envisaging economic diversification with a robust contribution from oil and its derivatives, with revenues channelled into investments in high value-added sectors such as financial services, medical services, tourism, education, renewable energy, and technologies to enhance economic growth. arabianoilandgas.com

Francis Patalong, Al Tamimi & Co.

Thus, in relation to Vision 2030, climate change is a Black Swan, because its acceleration, in terms of temperature increase and also in terms of political imperatives, is rapidly narrowing the goalposts for a sector already balancing rising domestic demand with reduced oil prices. Investor issues Successful future investment is likely to have certain characteristics. In the Saudi context, the Saudi Electricity Company (SEC) has a fundamental role on the supply side. There have been indications that the government, the 80% shareholder, is considering restructuring it into generation, transmission, and distribution companies. This is a relatively well-trodden path globally and many good lessons can be applied. As regards to renewables, a new wave of technology is being developed with enhanced generation and storage features; the Kingdom is actively participating in this already. Last year, it was announced that hot sand concentrated solar power, which does not suffer the degradation issues existing solar technologies encounter in conditions of extreme heat and dust, is set to become a commercial reality. This will bring significant environmental and cost benefits, especially as regards rural power generation. Globally, we are faced with the consequences of our failure to wean ourselves from our “addiction to oil”. The young people of the Kingdom, and their peer group across the world, will inhabit that new reality. But, as will be gleaned from the above, there are many “moving parts”, each of which, to a greater or a lesser extent, depends on the others. Sooner rather than later, some hard choices will have to be made, based on a critical, iterative analysis of what is a fluid, developing, and complex situation. The correct combination of educational and energy policies, therefore, represents the single most important element of Vision 2030. JANUARY 2017

PROJECT FOCUS

PDO - Khulud Tight Gas Development Project (KLD)

Budget:

$3bn

T 60

he largest oil and gas producer in the Sultanate, Petroleum Development Oman (PDO) and its main partner Royal Dutch Shell plc (Shell) plan to develop the challenging Khulud Tight Gas project in its Block-6 concession of central Oman. In 2010, PDO declared a series of oil and gas discoveries in Khulud. To reach discovery in Khulud, PDO and Shell had to drill up to 5,000 metres deep, which makes Khulud one of the deepest tight gas fields in the world. In addition to the exceptional depth of the reservoir, Khulud lies in extreme tightness of rocks formation from where the extraction requires from PDO and Shell the most advanced recovery technologies. Located in the YibalFahud area of central Oman, Khulud – with an estimated reserve of ‘several trillion cubic feet’ - is PDO’s first tight gas development. In an earlier interview with Oil & Gas Middle East, PDO’s managing director, Raoul Restucci, said that Khulud tight gas project is ‘one to watch out for’. “Since January 2014, six wells have been producing through an Early Production System that was commissioned in 2013 to test the long-term potential of the field,” Restucci said.

PROJECT FINANCE

Petroleum Development Oman (PDO) is the client.

CONTRACTORS Contract Type

Pre-Qualified

Bidders

EPC

• Petrofac • Galfar Engineering & Contracting SAOG • L&T - Larsen & Toubro

• Petrofac • Galfar Engineering & Contracting SAOG

FEED

• WorleyParsons

JANUARY 2017

Awarded

arabianoilandgas.com

PROJECT FOCUS

FAST FACTS Name of Client PDO - Petroleum Development Oman Estimated Budget ($ US) 300,000,000 Facility Type Gas Field Development Sector Gas Status EPC ITB Location Al Wusta

Project Start Q2 2015 End Date Q2 2020 Last Updated 05-10-2016 FEED WorleyParsons PMC Not known Main Contractor Award Date Q2 2017

PROJECT SCHEDULES Feasibility Study

Q2 2015

EPC ITB

Q3 2016

Engineering & Procurement

Q2 2017

Construction

Q4 2017

Completion estimated

Q2 2020 83 61

PROJECT STATUS

Date 6th Oct 2016

A JV of Petrofac and Galfar Engineering & Contracting is among the companies bidding for the main contract.

5th Oct 2016

The project is currently at the bidding stage. The winning bidder will design, build, finance and own the field facilities. Petroleum Development Oman will sign a long term lease agreement with the winning bidder to use the facilities.

10th Jan 2016

Khulud Tight Gas Development Mega Project (KLD) has been down sized to mid-sized project due to the current economic situation. PDO will start looking for investors to finance the project once the concept design is completed.

Jun 2015

PDO starts concept study on the proposed project.

28th Jan 2015

PDO completes the handover of the Khulud Tight Gas field from the Exploration Directorate to the Gas Development Directorate.

PROJECT SCOPE Typical gas development projects include: • Central processing facilities • Gas processing plant • Pipelines • Gas gathering • Wellsides and export system (GWES) facilities • Associated utilities • Building and infrastructure work

arabianoilandgas.com

Status

JANUARY 2017

PROJECTS

Ongoing and upcoming projects Information is supplied by DMS Projects GCC GAS â&#x20AC;&#x201C; DECEMBER 2016

Project

Country

City/ Region

Facility

Budget

Status

Completion Date

ADCO- Bu Hasa Shuaiba South- Gas Lift Network

U.A.E.

Abu Dhabi

Gas Network

800,000,000

Construction

2018-Q1

ADGAS - Das Island Flaring & Emission Reduction

U.A.E.

Abu Dhabi

Gas Production

100,000,000

Construction

2018-Q1

ADGAS- Integrated Facilities Project (IGD-S) Expansion (Phase 4)

U.A.E.

Abu Dhabi

Gas Field Development

1,057,000,000

EPC ITB

2019-Q3

ADGAS- Integrated Gas Development (IGD) - Expansion (Overview)

U.A.E.

Abu Dhabi

Gas Field Development

1,057,000,000

EPC ITB

2019-Q1

ADGAS- Integrated Gas Development (IGD) - Expansion (Phase 1)

U.A.E.

Abu Dhabi

Gas Field Development

1,057,000,000

Construction

2017-Q3

ADMA OPCO - Umm Shaif Super Complex- Additional Gas Supply & Flexibility Assurance

U.A.E.

Abu Dhabi

Gas Production

494,000,000

Construction

2016-Q2

ADMA OPCO- Nitrogen Plant Upgrade

U.A.E.

Abu Dhabi

Nitrogen

55,000,000

Design

2017-Q1

ADMA-OPCO - Nasr Full Field Development - (Overview)

U.A.E.

Abu Dhabi

Oil Field Development

1,700,000,000

Construction

2018-Q4

ADMA-OPCO - SARB Offshore Oil Field Development - Package 2

U.A.E.

Abu Dhabi

Oil & Gas Field

500,000,000

Construction

2016-Q4

ADMA-OPCO - SARB Offshore Oil Field Development - Package 3

U.A.E.

Abu Dhabi

Gas Pipeline

600,000,000

Construction

2016-Q1

ADMA-OPCO - SARB Offshore Oil Field Development - Package 4

U.A.E.

Abu Dhabi

Gas Processing

500,000,000

Construction

2017-Q3

ADNOC - LNG Import Terminal

U.A.E.

Abu Dhabi

LNG Storage Tanks

1,000,000,000

Feasibility Study

2018-Q3

Al Hosn Gas- Shah Field- Expansion

U.A.E.

Abu Dhabi

Gas Network

Feasibility Study

2021-Q4

Bahrain LNG WLL - Liquefied Natural Gas Receiving and Regasification Terminal

Bahrain

Hidd

Liquefied Natural Gas (LNG)

660,000,000

Construction

2018-Q4

Banagas - Central Gas Plant Expansion

Bahrain

Sitra

Gas Treatment Plant

600,000,000

Construction

2018-Q3

Banagas - Fuel Pipelines And Storage Facilities Expansion

Bahrain

Sitra

Gas Storage Tanks

80,000,000

Engineering & Procurement

2018-Q3

BP - Block 61 - Khazzan and Makarem Gas Fields Development

Oman

Gas Field Development

24,000,000,000

Construction

2022-Q1

BP - Block 61 - Khazzan Gas Fields Development - Phase 1 - Central Processing Facility

Oman

Al Dahirah

Gas Processing

1,200,000,000

Construction

2017-Q2

BP - Block 61 - Khazzan Gas Fields Development - Phase 1 - Overview

Oman

Al Dahirah

Gas Field Development

15,000,000,000

Construction

2017-Q4

BP - Block 61 - Khazzan Gas Fields Development - Phase 1 - Package 1

Oman

Al Dahirah

Gas Field Development

1,500,000,000

Construction

2018-Q4

BP - Block 61 - Khazzan Gas Fields Development - Phase 1 - Package 2

Oman

Al Dahirah

Gas Field Development

130,000,000

Construction

2017-Q3

BP - Block 61 - Khazzan Gas Fields Development - Phase 2

Oman

Al Dahirah

Gas Field Development

5,000,000,000

Design

2020-Q4

DNO - Block 8 Oil & Gas Field Development

Oman

West Bukha

Gas Field

45,000,000

Construction

2018-Q4

Emirates LNG - Fujairah LNG

U.A.E.

Fujairah

Liquefied Natural Gas (LNG)

3,000,000,000

Feasibility Study

2018-Q4

GASCO - Abu Dhabi Sales Gas Network- Compression Station

U.A.E.

Abu Dhabi

Gas Pipeline

900,000,000

Feasibility Study

2018-Q2

GASCO - Black Powder Management

U.A.E.

Abu Dhabi

Gas Pipeline

44,000,000

Construction

2017-Q4

GASCO - Habshan to Ruwais - 16 inch Condensate Replacement Pipeline

U.A.E.

Abu Dhabi

Gas Pipeline

90,000,000

Construction

2016-Q4

GASCO - Integrated Gas Development (IGD) - Expansion (Onshore Pipeline)

U.A.E.

Abu Dhabi

Gas Production

12,000,000,000

Construction

2016-Q4

GASCO - Taweelah - Gas Compressor Station

U.A.E.

Abu Dhabi

Gas Processing

70,000,000

Engineering & Procurement

2019-Q1

GASCO - Yas - Mina Zayed Gas Pipeline

U.A.E.

Abu Dhabi

Gas Processing

45,000,000

Construction

2015-Q1

GASCO- Asab 1- Control System Upgrade

U.A.E.

Abu Dhabi

Distributed Control System (DCS)

100,000,000

EPC ITB

2018-Q4

GASCO- Gas Turbine Replacement (Phase 1 - Asab & Buhasa)

U.A.E.

Abu Dhabi

Gas Processing

130,000,000

FEED

2017-Q4

GASCO- Habshan 5 - New Compression Train

U.A.E.

Abu Dhabi

Gas Processing

800,000,000

EPC ITB

2018-Q1

KGOC - Wafra Central Gas Utilisation Project

Kuwait

Wafra

Gas Processing

1,000,000,000

EPC ITB

2019-Q3

KNPC - Al Zour LNG Import and Regasification Terminal

Kuwait

Al Zour

Liquefied Natural Gas (LNG)

3,330,000,000

Engineering & Procurement

2020-Q3

KNPC - Mina Al Ahmadi Refinery Fifth Gas Train

Kuwait

Mina Al Ahmadi

Gas Production

2,000,000,000

Construction

2017-Q4

KOC - North Kuwait Gathering Center (GC) 32

Kuwait

Northern Kuwait

Gas Gathering Centre

2,000,000,000

EPC ITB

2021-Q4

JANUARY 2017

arabianoilandgas.com

PROJECTS

Project

Country

City/ Region

KOC - North Kuwait Manifold Gathering System for Gathering Centers (GC) 29, 30, 31

Kuwait

MASDAR - Carbon Dioxide Capture and Storage - Phase I (Mussafah Steel Rolling Mill)

U.A.E.

MASDAR - Carbon Dioxide Capture and Storage - Phase I (Overview)

U.A.E.

Completion Date

Facility

Budget

Status

Northern Kuwait

Gas Gathering Centre

2,500,000,000

Construction

2017-Q4

Abu Dhabi

Carbon Dioxide

280,000,000

Construction

2016-Q2

Abu Dhabi

Carbon Dioxide

2,500,000,000

Construction

2016-Q2

NOGA - Gazprom - Liquefied Natural Gas (LNG) Distribution Centre

Bahrain

Various

Liquefied Natural Gas (LNG)

600,000,000

Feasibility Study

2018-Q2

NOGA - Onshore Deep Gas Exploration

Bahrain

Various

Gas Exploration

200,000,000

Engineering & Procurement

2015-Q4

Oman Gas Company - Murayrat PLS Upgrade

Oman

Adam Ad Dakhliya

Gas Processing

100,000,000

Construction

2017-Q4

Oman Gas Company - Muscat Gas Network

Oman

Muscat

Gas Network

100,000,000

FEED ITB

2020-Q1

Oman Gas Company - Salalah Loopline

Oman

Salalah

Gas Pipeline

70,000,000

Construction

2016-Q4

Oman Gas Company - Salalah LPG Extraction

Oman

Salalah

Liquefied Petroleum Gas (LPG)

100,000,000

EPC ITB

2019-Q2

Orpic - Liwa Plastics Industries Complex - NGL Extraction Units

Oman

Sohar

Natural Gas Liquefaction (NGL)

700,000,000

Engineering & Procurement

2019-Q1

Orpic - Nitrogen Gas Plant

Oman

Sohar

Nitrogen

50,000,000

EPC ITB

2018-Q3

Oryx GTL - Expansion of Gas To Liquids Plant

Qatar

Ras Laffan

Gas to Liquids (GTL)

1,500,000,000

Feasibility Study

2019-Q4

PDO - Kauther Depletion Compression Phase 2 (KDC2)

Oman

Al Dakhiliya

Gas Compression

190,000,000

Engineering & Procurement

2019-Q2

PDO - Khulud Tight Gas Development Project (KLD)

Oman

Al Wusta

Gas Field Development

300,000,000

EPC ITB

2020-Q2

PDO - Mabrouk Deep Phase-3 (Gathering & Surface Facilities)

Oman

Saih Rawl

Gas Gathering

200,000,000

Engineering & Procurement

2018-Q2

PDO - Rabab-Harweel Integrated Plant (RHIP) - Overview

Oman

Harweel

Gas Processing

3,000,000,000

Construction

2019-Q1

PDO - Saih Nahaydah Depletion Compression Phase-2 (SNDC2)

Oman

Saih Nihayda

Gas Compression

180,000,000

Engineering & Procurement

2019-Q2

PDO - Saih Nihayda Condensate Stabilisation Plant

Oman

Saih Nihayda

Gas Treatment Plant

115,000,000

Construction

2017-Q4

PDO - SRCPP & SNGP Condensate Recovery Maximisation

Oman

Saih Nihayda

Gas Processing

300,000,000

Construction

2017-Q1

PDO - Yibal Depletion Compression - Phase 3 (Y3DC)

Oman

Yibal

Gas Processing

300,000,000

Construction

2016-Q4

PDO - Zauliah Gas Plant Project

Oman

Al Wusta

Gas Processing

110,000,000

Construction

2016-Q4

Qatar Petroleum (QP) - Air Compressor Replacement at Mesaieed Refinery

Qatar

Mesaieed

Gas Processing

50,000,000

Construction

2017-Q3

Qatar Petroleum (QP) - Vapour Recovery System at Multi Product Berth

Qatar

Mesaieed

Gas Processing

50,000,000

EPC ITB

2017-Q2

RasGas - Qatar Barzan Gas Field Development Project (Overview)

Qatar

North Field

Gas Field Development

10,300,000,000

Construction

2021-Q4

RasGas - Qatar Barzan Gas Field Development Project - Offshore - Phase 2

Qatar

North Field

Gas Field Development

700,000,000

Engineering & Procurement

2019-Q4

RasGas - Qatar Barzan Gas Field Development Project - Offshore - Phase 3

Qatar

North Field

Gas Field Development

300,000,000

Engineering & Procurement

2023-Q4

RasGas - Qatar Barzan Gas Field Development Project - Onshore - Phase 2

Qatar

North Field

Gas Field Development

2,000,000,000

Feasibility Study

2019-Q4

Saudi Aramco - Arabiyah and Hasbah Gas Field Development

Saudi Arabia

Arabiyah

Gas Field

3,000,000,000

Construction

2019-Q1

Saudi Aramco - Fadhili Gas Plant (Overview)

Saudi Arabia

Eastern Region

Gas Treatment Plant

13,300,000,000

Construction

2021-Q1

Saudi Aramco - Fadhili Gas Plant - Downstream Packages

Saudi Arabia

Eastern Region

Gas Processing

1,000,000,000

Engineering & Procurement

2018-Q1

Saudi Aramco - Fadhili Gas Plant - Industrial Support Facilities (FISF)

Saudi Arabia

Eastern Region

Gas Treatment Plant

100,000,000

Construction

2017-Q4

Saudi Aramco - Fadhili Gas Plant - Main Processing Facilities (Package 1)

Saudi Arabia

Eastern Region

Gas Treatment Plant

2,500,000,000

Construction

2021-Q1

Saudi Aramco - Fadhili Gas Plant - Offsites & Utilities (Package 3)

Saudi Arabia

Eastern Region

Gas Field

2,000,000,000

Construction

2021-Q1

Saudi Aramco - Fadhili Gas Plant - Sulphur Recovery Unit SRU (Package 2)

Saudi Arabia

Eastern Region

Gas Treatment Plant

2,500,000,000

Construction

2021-Q2

Saudi Aramco - Hasbah Field Increment II

Saudi Arabia

Hasbah

Gas Field

1,600,000,000

Construction

2019-Q2

Saudi Aramco - Liquefied Gas Station For Shadqam & Al Uthmaniah Gas Plants

Saudi Arabia

Abqaiq

Natural Gas Liquefaction (NGL)

74,000,000

Construction

2018-Q3

Saudi Aramco - Liquefied Natural Gas (LNG) Receiving Terminal

Saudi Arabia

Jeddah

Liquefied Natural Gas (LNG)

1,000,000,000

Feasibility Study

2017-Q3

Saudi Aramco - Master Gas System Expansion (MGSE) (Overview)

Saudi Arabia

Various

Natural Gas Liquefaction (NGL)

4,050,000,000

Construction

2020-Q1

Saudi Aramco - Master Gas System Expansion (MGSE) - Phase I

Saudi Arabia

Various

Gas Pipeline

1,650,000,000

Construction

2017-Q2

Saudi Aramco - Midyan Gas Processing Plant

Saudi Arabia

Tabuk

Gas Processing

800,000,000

Construction

2016-Q4

Saudi Aramco - Unconventional Gas Program - Tight Gas Production Systems A

Saudi Arabia

Turaif

Gas Field Development

200,000,000

Construction

2020-Q4

arabianoilandgas.com

JANUARY 2017

PROJECTS

Project

Country

City/ Region

Facility

Budget

Status

Completion Date

Saudi Aramco - Unconventional Gas Program - Tight Gas Production Systems A and B (Overview)

Saudi Arabia

Turaif

Gas Field Development

3,500,000,000

Construction

2020-Q4

Saudi Aramco - Unconventional Gas Program - Tight Gas Production Systems B

Saudi Arabia

Turaif

Gas Field Development

800,000,000

Construction

2020-Q4

Saudi Aramco - Uthmaniya Gas Treatment Units

Saudi Arabia

Uthmaniyah

Gas Network

900,000,000

Engineering & Procurement

2019-Q4

Shell - Pearl GTL Scheme - Onshore & Offshore Facilities

Qatar

Natural Gas Liquefaction (NGL)

20,000,000,000

Construction

2019-Q3

Tatweer Petroleum - Central Gas Dehydration Facilities

Bahrain

Awali

Gas Processing

100,000,000

Construction

2018-Q3

VOPAK HORIZON - Fujairah Oil Terminal Expansion (Phase 7)

U.A.E.

Fujairah

Gas Storage Tanks

200,000,000

Construction

2017-Q4

ZADCO - Upper Zakum Full Field Development - 750 Project - Surface Facilities - EPC 1

U.A.E.

Abu Dhabi

Oil Field Development

1,300,000,000

Construction

2017-Q4

ZADCO - Upper Zakum Full Field Development - 750 Project - Surface Facilities - EPC 2

U.A.E.

Abu Dhabi

Oil Production

4,200,000,000

Construction

2017-Q4

ZADCO- 750 West Region- Capacity Expansion & Sulphate Reduction Plant- EPC 3

U.A.E.

Abu Dhabi

Oil & Gas Field

300,000,000

EPC ITB

2019-Q1

Project

Country

City

Facility

Budget

Status

Completion Date

ADCO - Bab Far North CO2 Injection Pilot Project

U.A.E.

Abu Dhabi

Oil Field Development

305,000,000

Construction

2016-Q4

ADCO - Mender Field Development

U.A.E.

Abu Dhabi

Oil Field Development

350,000,000

Construction

2018-Q3

ADCO - North East Bab (NEB) - (Al Dabbiya) ASR

U.A.E.

Abu Dhabi

Oil Production

2,500,000,000

EPC ITB

2020-Q1

ADCO - North East Bab (NEB) - Phase 3 (Al Dabbiya)

U.A.E.

Abu Dhabi

Oil Production

2,500,000,000

Construction

2017-Q4

GCC OIL â&#x20AC;&#x201C; DECEMBER 2016

ADCO - North East Bab (NEB) - Phase 3 (Rumaitha-Shanayel)

U.A.E.

Abu Dhabi

Oil Production

2,500,000,000

Construction

2017-Q4

ADCO - Rumaitha North CO2 Injection Project

U.A.E.

Abu Dhabi

Oil Field Development

200,000,000

Construction

2016-Q4

ADCO - South East Asset- Sahil Field Development - Phase 2

U.A.E.

Abu Dhabi

Oil Field Development

175,000,000

Construction

2016-Q3

ADCO- Bab Integrated Facilities Project- Expansion

U.A.E.

Abu Dhabi

Oil Field Development

3,000,000,000

Feasibility Study

2020-Q1

ADCO- Buhasa- Wellhead Automation

U.A.E.

Abu Dhabi

Oil Field Development

100,000,000

FEED

2019-Q3

ADCO- Fujairah MOT - Hydraulic Pressure Recovery System Turbine

U.A.E.

Fujairah

Oil Field Development

800,000,000

FEED

2017-Q1

ADCO- South East Asset- Tie-in Project (A,B, C & D)

U.A.E.

Abu Dhabi

Oil Field Development

650,000,000

Construction

2018-Q1

ADMA OPCO - Nasr Full Field Development - Phase 2 (Package 2 - Platforms)

U.A.E.

Abu Dhabi

Oil Field Development

200,000,000

Engineering & Procurement

2018-Q4

ADMA OPCO - Nasr Full Field Development - Phase 2 (Package 3)

U.A.E.

Abu Dhabi

Oil Field Development

200,000,000

Construction

2018-Q4

ADMA OPCO - Umm Shaif Super Complex- Additional Gas Supply & Flexibility Assurance

U.A.E.

Abu Dhabi

Gas Production

494,000,000

Construction

2016-Q2

ADMA OPCO- Nasr Full Field Development - Phase 2 (Package 1 - Wellheads and Pipeline)

U.A.E.

Abu Dhabi

Oil Field Development

900,000,000

Construction

2018-Q4

ADMA-OPCO - 100 MBD DAS Facilities Upgrade Project

U.A.E.

Abu Dhabi

Oil Field Development

48,000,000

Construction

2017-Q1

ADMA-OPCO - Nasr Full Field Development - (Overview)

U.A.E.

Abu Dhabi

Oil Field Development

1,700,000,000

Construction

2018-Q4

ADMA-OPCO - SARB Offshore Oil Field Development - Package 2

U.A.E.

Abu Dhabi

Oil & Gas Field

500,000,000

Construction

2016-Q4

ADMA-OPCO - SARB Offshore Oil Field Development - Package 3

U.A.E.

Abu Dhabi

Gas Pipeline

600,000,000

Construction

2016-Q1

ADMA-OPCO - SARB Offshore Oil Field Development - Package 4

U.A.E.

Abu Dhabi

Gas Processing

500,000,000

Construction

2017-Q3

ADMA-OPCO - Umm Al Lulu Field Development - (Overview)

U.A.E.

Abu Dhabi

Oil Field Development

2,500,000,000

Construction

2018-Q1

ADMA-OPCO - Umm Al Lulu Field Development - Package 1

U.A.E.

Abu Dhabi

Oil Field Development

800,000,000

Construction

2018-Q1

ADMA-OPCO - Umm Al Lulu Field Development - Package 2

U.A.E.

Abu Dhabi

Oil Field Development

200,000,000

Construction

2016-Q4

ADMA-OPCO - Umm Shaif Infield Pipelines Replacement

U.A.E.

Abu Dhabi

Oil Field Development

500,000,000

EPC ITB

2015-Q4

ADMA-OPCO- Bu Haseer Field

U.A.E.

Abu Dhabi

Pipeline

200,000,000

Engineering & Procurement

2018-Q3

ADMA-OPCO- Lower Zakum - Oil Lines Replacement (Phase 1)

U.A.E.

Abu Dhabi

Pipeline

950,000,000

Construction

2016-Q4

ADNOC & EMARAT - Fujairah Terminal Expansion Phase 3

U.A.E.

Fujairah

Oil Storage Tanks

40,000,000

Feasibility Study

2018-Q4

ADNOC- Ghasha Field

U.A.E.

Abu Dhabi

Oil & Gas Field

1,000,000,000

FEED ITB

2025-Q1

ADOC - Hail Offshore Oilfield

U.A.E.

Abu Dhabi

Oil Field Development

500,000,000

Engineering & Procurement

2018-Q3

ADOC - Mubaraz Field Expansion

U.A.E.

Abu Dhabi

Oil Field Development

500,000,000

FEED

2017-Q4

JANUARY 2017

arabianoilandgas.com

PROJECTS

Project

Country

City / Region

Facility

Budget

Completion Date

Status

Al Dhafra Petroleum - Haliba Oil Field

U.A.E.

Abu Dhabi

Oil Field Development

500,000,000

EPC ITB

2023-Q2

Al Hosn Gas - Dalma Field

U.A.E.

Abu Dhabi

Oil Field Development

800,000,000

Feasibility Study

2020-Q4

BAC - NOGA - Bahrain International Airport Modernization Program - New Aviation Fuel Farm & Fuel Hydrant

Bahrain

Muharraq

Oil Storage Tanks

200,000,000

EPC ITB

2019-Q1

Bahri - Very Large Crude Carriers (VLCCs) Construction

Saudi Arabia

Various

Very Large Crude Carriers (VLCCs)

1,000,000,000

Construction

2017-Q4

Bapco - Offshore Blocks

Bahrain

Various

Exploration

80,000,000

EPC ITB

2020-Q2

BPGIC - Fujairah Oil Terminal (Phase 1 & 2)

U.A.E.

Fujairah

Oil Storage Tanks

200,000,000

Construction

2017-Q1

Duqm Petroleum Terminal Company - Duqm Liquid Jetty

Oman

Duqm

Oil Storage Terminal

1,000,000,000

EPC ITB

2019-Q4

Duqm Petroleum Terminal Company - Duqm Liquid Jetty - Topside Facilities

Oman

Duqm

Oil Storage Terminal

250,000,000

EPC ITB

2019-Q4

GASCO - Integrated Gas Development (IGD) - Expansion (Onshore Pipeline)

U.A.E.

Abu Dhabi

Gas Production

12,000,000,000

Construction

2016-Q4

GASCO - Yas - Mina Zayed Gas Pipeline

U.A.E.

Abu Dhabi

Gas Processing

45,000,000

Construction

2015-Q1

GASCO- Integrated Gas Development - Expansion (42 Inch Pipeline)

U.A.E.

Abu Dhabi

Oil Field Development

450,000,000

Construction

2018-Q4

Gulf Petrochem - Oil Storage Terminal Facility at Fujairah - Phase 2

U.A.E.

Fujairah

Oil Storage Tanks

300,000,000

EPC ITB

2019-Q1

Hydrocarbon Finder - Block 7 Onshore Exploration and Production

Oman

Al Wusta

Exploration

50,000,000

Engineering & Procurement

2019-Q1

IPIC & Mubadala- Fujairah Refinery (EPC 1 & 2)

U.A.E.

Fujairah

Refinery

3,500,000,000

EPC ITB

2018-Q4

KNPC - Expansion of Ahmadi Depot

Kuwait

Ahmadi

Oil Storage Tanks

250,000,000

Construction

2019-Q3

KNPC - Matlaa New Depot

Kuwait

Northern Kuwait

Oil Storage Tanks

500,000,000

EPC ITB

2019-Q4

KOC - Exxon Mobil Corporation - Ratqa Lower Fars Heavy Oil Handling Facilities - Drilling Package

Kuwait

Jahra

Oil Field Development

500,000,000

Construction

2018-Q2

KOC - Jurassic Production Facilities Off-Plot Works

Kuwait

Northern Kuwait

Oil Field Development

300,000,000

EPC ITB

2018-Q2

KOC - Kuwait Environmental Remediation Program (KERP) - North Package

Kuwait

Northern Kuwait

Oil & Gas Field

100,000,000

Construction

2021-Q4

KOC - Kuwait Environmental Remediation Program (KERP) - Overview

Kuwait

Oil & Gas Field

300,000,000

Construction

2021-Q4

KOC - North Kuwait Jurassic Early Production Facility (EPF) - Phase 2

Kuwait

Northern Kuwait

Oil Production

100,000,000

Engineering & Procurement

2017-Q3

KOC - North Kuwait Jurassic Oil and Gas Field Development

Kuwait

Northern Kuwait

Oil & Gas Field

1,300,000,000

Engineering & Procurement

2018-Q2

KOC - Ratqa Lower Fars Heavy Oil Development - Phase 1

Kuwait

Northern Kuwait

Steam Injection

4,500,000,000

Construction

2019-Q2

KOC - Soil Remediation Services - Lot A

Kuwait

Oil & Gas Field

100,000,000

Construction

2017-Q3

KOC - Southern Kuwait Maintenance of Oil Production Facilities

Kuwait

Kuwait South

Oil Production

150,000,000

Construction

2020-Q3

Masirah Oil Ltd - Block 50 (Masirah Bay Offshore) - Exploration

Oman

Masirah Basin

Exploration

25,000,000

Construction

2020-Q1

Medco Arabia - Block 56 Onshore Exploration and Production

Oman

Adam Ad Dakhliya

Exploration

20,000,000

Engineering & Procurement

2020-Q4

MOG - Block 54 Onshore Exploration and Production

Oman

Al Wusta

Exploration

50,000,000

Engineering & Procurement

2020-Q3

MOG - Block 55 Onshore Exploration and Production

Oman

Al Wusta

Exploration

45,000,000

Engineering & Procurement

2019-Q1

OOCEP - Block 60 Concession - Onshore

Oman

Oil & Gas Field

1,100,000,000

Engineering & Procurement

2020-Q4

OTTCO - Ras Markaz Crude Oil Park

Oman

Duqm

Oil Storage Terminal

400,000,000

EPC ITB

2019-Q4

PDO - Amal Steam Phase 1C Surface Facilities

Oman

Amal Oilfield

Enhanced Oil Recovery (EOR)

80,000,000

Construction

2018-Q1

PDO - Amal Steam Phase 1C-2

Oman

Amal Oilfield

Oil Field Development

300,000,000

EPC ITB

2019-Q1

PDO - Yibal Khuff Sudair Field Development

Oman

Northern Oman

Oil Field Development

3,000,000,000

Construction

2019-Q1

Qatar Petroleum (QP) - Bul Hanine Redevelopment (Offshore)

Qatar

Bul Hanine

Oil Field Development

11,000,000,000

FEED

2028-Q1

Qatar Petroleum - Al Shaheen Offshore Field Development Plan

Qatar

Oil & Gas Field

500,000,000

Construction

2017-Q3

Sabic - Oil-To-Chemicals Plant

Saudi Arabia

Yanbu

Oil Production

30,000,000,000

Feasibility Study

2020-Q4

Sadara Chemical Company - Jubail Petrochemicals Complex - Refinery Tank Farm Package

Saudi Arabia

Jubail

Oil Storage Tanks

500,000,000

Construction

2016-Q4

Saudi Aramco - Annual Onshore Maintain Potential Program (MPP)

Saudi Arabia

Red Sea

Maintenance

5,000,000,000

Construction

2021-Q2

Note : The above information is the sole property of DMS Projects. Budget figures are shown as US $ values.

arabianoilandgas.com

Source: dmsprojects.net

JANUARY 2017

FIVE MINUTES WITH

Dick McAdam, vice president of SPX Flow Middle East

FIVE MINUTES WITH...

ABOUT THE INTERVIEWEE: Dick McAdam is the VP of global pump sales, & VP of Middle East pumps, valves, filtration sales at SPX FLOW Power & Energy.

What is the most notable difference that you see in the regional industry now compared to that in the 1980s? The sector in those days was still dominated by the seven majors - Exxon Mobil, BP, Shell, etc. As a consequence, the available products were entirely from the US, Europe or Japan. Now, the market has grown so much in size and has become so competitive, importing products from everywhere on the planet including China, India and Mexico. So there has been a shift from buying just American products to choosing from a global selection.

1.47

Do you feel the regional industry has become more focussed on return on investment? Yes. In those days, regional players in the oil and gas sector were very loyal to certain companies. Any product that had the GE brand on it, for instance, was highly desired here in the GCC. In its simplest form, that was true of the cars as well. In the 1980s, the cars on the streets were all American. Today, this is obviously not the case.

2 . 2 5

What do you think is the rest of the world’s opinion about the oil and gas sector in the Middle East? Compared to the other regions of the world, I think these days the oil and gas sector in this region has cutting-edge technology in terms of products and progress. For example, the

Abu Dhabi funds are about $3tn and there is so much resource behind them. I remember going to an ADNOC seminar, which were the very early days of horizontal drilling. This was at a time when the global industry hardly knew about it. In Abu Dhabi, they were already doing it. So I think that here in the region they want the best of technology, which they can afford to buy. The rest of the world can clearly see these indications.

Will SPX-Flow be undergoing any major change in the corporate strategy in 2017? I think that 2017 is going to be a flat year over 2016 here in the region, which is a good thing. Elsewhere, the market is still down. Here, Bahrain will build a new refinery this year; Oman has the Duqm project, which is one of the biggest projects in the world; Kuwait is building a refinery; there is the East-West pipeline in Saudi; and there are also a lot of new projects happening in Abu Dhabi. JANUARY 2017

4.03

0.00

Oil & Gas Middle East delves beneath the corporate strategy to understand what really makes the industry’s leaders tick

“THERE HAS BEEN A HUGE SHIFT FROM BUYING JUST AMERICAN PRODUCTS TO CHOOSING WHAT IS THE MOST COMPETITIVE AND WHAT IS GOING TO GET THEM THE MOST RETURN ON INVESTMENT IN THE SHORT TERM.”

3.05

How is your company surviving the decline in oil prices? With the downturn, we had to address our capacity for manufacturing facilities elsewhere in the world (in terms of headcount), but not in the GCC. Despite the global decline, the region has been one of the success stories in the last two years. This is mainly because of the huge funds and reserves of the regional NOCs. Additionally, their plans are not just for the short-term, rather they extend those for 25 years. Thus, the current market condition is just a bump in the road. arabianoilandgas.com

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A leading fabrication contractor in the Onshore & Offshore Oil & Gas, Rigs/Jack Up Repair & Upgrades, Ship Building and Ship Repair z An interdisciplinary company offering one-stop-shop services z 280,000 sq. meters yard space and 545 meters water front z QMS certified with API Spec Q1 & ISO 9001 z HSE certified with ISO 14001, OHSAS 18001 & OSHAD z ASME certified with A, PP, S, U, & U2 stamps, National Board stamps NB & R z

Ali & Sons Marine Engineering Factory P.O. Box 133393 | Abu Dhabi | United Arab Emirates T +9712 551 2432 | F +9712 551 2431 asme@ali-sons.com | www.asme.ali-sons.com