Efficiency gains compensating for wage hikes and recruitment challenges. Danish experience from the North Sea. Speaker: Mr. Peter Blach CEO - Offshore Center Danmark WWW: www.offshorecenter.dk The copyright of this entire training material vests by Offshore Center Danmark. All rights reserved. The information contained herein is the property of above company and is supplied without liability for errors or omissions. No part may be reproduced or used except as authorized by contract or other written permission. 1
Efficiency gains Subjects Subjects: North Sea characteristics Challenge #1 Optimizing ROI from manhours Challenge #2 Recruitment challenges Lessons learned
Efficiency gains North Sea Characteristics The North Sea: 1859: Oil trace discovery. 1910: Natural gas discovery. 1966: Exploration drilling. 1971: Commercial production. Defines brent crude oil standard. Political stability in the region. Matured infra structure. Western Europe s largest oil and gas reserves. One of the key non-opec producing regions. Totals more than 600 installations. 3
Efficiency gains North Sea Characteristics Danish Sector: Depth < 60 m. Reservoir rock: primarely chalk - some sandstone reservoirs. Permeability: from single digit md. App. 60 offshore installations. Aberdeen Stavanger N Original recovery rate: 5-7% Current recovery rate: 25-30% Production: 350 MBOD. App. 130 producing wells. Horisontal drilling. Water injection wells. UK NL DK D Esbjerg Swing producers. 4
Danish Efficiency Offshore gains Activity The North Danish Sea Characteristics Oil and Gas Fields Dan the largest Danish Oil Field 5
Efficiency gains North Sea Characteristics North Sea Infra Structure Gas Planned gas Oil 6
Danish Efficiency Offshore gains Activity Installations Challenge #1in the North Sea Optimizing ROI(Return On Investment) from manhours. Approaches: Strategic spare part stock inventory Long lead items. Units for refurbishment. Inventory based on decades of acquired data. Goal: Elimination of lead time and express orders and delivery. Kit systems management Parts lists management linked to specific replacement jobs. Cross search facilities on multiple kits and inventory lists. Ensuring all parts and tools are available for re-ocurring jobs. Goal: Elimination of unproductive manhours. Comprehensive database on component MTBF data MTBF = Mean Time Before Failure. Essential to service and refurbishment scheme planning. Goal: Elimination of unforeseen breakdowns causing production loss and unforeseen expenditures. 7
ChallengesActivity Efficiency gains ChaSea Challenge #1 Optimizing ROI on manhours. Approaches: Strategic inspection schemes Yearly inspection campaigns to inspect for abnormalities like excessive corrosion/abrasion, free spans etc. Logging and monitoring wear and tear. Goal: Development of wear and tear curves for components to ensure an optimum service life before refurbishment or replacement. Strategic replacement and refurbishment Schemes based on MTBF data. Replace before malfunction. approach. Goal: Eliminating unforeseen replacement and refurbishment. 8
Danish Efficiency Offshore gains Activity Installations Challenge #2in the North Sea Recruitment challenges. Approaches: Expats vs. Local workforce considerations Going from 99% expats in 1970 to app. 10% in 2010. Local workforce emerging as expats. Adjustments to global conditions. Flow of expats ensure that danish offshore industry is kept in sync with global offshore conditions and development. Goal: Ensuring that the local industry interacts and develops with the global industry. Adjusting business to workforce Unmanned installations and interventions. Work class ROV and robot technology. Diverless solutions. Goal: Implementation of technology in compliance with available workforce competences. Adjusting workforce to business Focus on identifying and filling competence gaps. Continous education of workforce. Goal: Ensuring that workforce competence level complies with the requirements from the industry. 9
Danish Efficiency Offshore gains Activity Installations Challenge #2in the North Sea Recruitment challenges. Approaches: Cluster activities Recruitment from inside the cluster. Profiling the industry through the cluster. Goal: Gathering of forces in a cluster structure to gain strength and synergy for the industry. Branding of Esbjerg as Offshore Capital of Denmark Gathering of offshore relevant courses and education in Esbjerg. Advertising the industry to the younger generations. Networking and joining forces. Goal: Full representation of the industry from one branded location. Facilitating synergy. Flexibility in courses and education Dynamic structures to ensure cooperation between universities, companies and relevant organisations. Developing courses and educations to fill competence gaps in local work force. From 1 day course to Master Degree level. Goal: Elimination of competence gaps in the available workforce. 10
Danish Efficiency Offshore gains Activity Installations Lessons learned in the North Sea Lessons learned: Global outlook and international awareness is key to ensure a dynamic and long term viable oil and gas industry. Adjusting business to available technology and workforce. Adjusting workforce to available technology and business. 11
Danish Efficiency Offshore gains Activity Installations in the North Sea Discussions Questions? Mr. Peter Blach CEO Offshore Center Danmark Niels Bohrs Vej 6 DK-6700 Esbjerg Ph: +45 3697 3670 Mail: pb@offshorecenter.dk WWW: www.offshorecenter.dk 12