Power of Scotland

Power ofScotland

Wednesday April 25 2012

Taking it to the limits

The Subsea sector reaches further and goes deeper

Intrepid Crew A confident Helix Well Ops

charts course in new waters

Wednesday April 25 2012 | the times

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Power of Scotlandthe times | Wednesday April 25 2012 3

Looking to the next generationWelome to the first issue of Power of Scotland, under the Business Insight banner, which focuses on Scotland’s all-important energy policy.

A commitment to supply the nation’s power from alternative sources by 2020 was always going to be a demanding one, and here we examine some of the pitfalls — not least the need to examine the small print when it comes to energy number-crunching.

Where, we ask, will the next generation of Scottish engineers come from, and is the talent pool in our schools and universi-ties deep enough to keep up with the demand for computing skills?

A measure of the challenge comes from Aberdeen, where fast-growing companies are taking the search for oil and gas further and deeper, consolidating that city’s reputation as the UK’s major oil capital.

Welcome

For energy industry com-panies moving into new provinces around the globe, failure to ensure that the right tax plans are in place can be a costly error.

Each country, from Nigeria to Mexico and Brazil to Kazakhstan,

has its own set of rules which have to be analysed and understood to ensure any profits made from overseas ventures are subject to as little tax as possible. The aim is to secure the maximum possible tax deductions using transfer pricing models, such as moving head office costs from Aberdeen, or wherever you are based, into Houston, Mexico, Brazil or wherever you are expanding.

Theoretically the Organisation for Eco-nomic Co-operation and Development (OECD) sets a common standard, but the reality is that not everywhere adheres to it. Each country has a different set of rules — rules which constantly change so you need to keep ahead of the game.

This is exactly why members of the UHY International, the Worldwide Net-work, have established an energy special interest group (SIG) which I chair. The UHY network consists of firms with offices in nearly 240 major business cen-tres in 78 countries and the SIG already has members from 17 countries including USA, Canada, Australia, Nigeria, Nor-way, Brazil, Kazakhstan and Dubai in the UAE. It was inaugurated in London last year and we will meet for the first time in Houston during the Offshore Technology Conference, the biggest event in the world for the offshore oil and gas industry.

The initiative is being driven by Camp-bell Dallas in Aberdeen, which is the only Scottish member of the UHY network, along with UHY advisors in Houston and UHY Haines Norton in Perth, Australia. The integration of services and resources into a single industry-focused practice is already delivering tangible benefits to our clients. We can share the latest research on emerging trends, locate individual experts on specific issues, collaborate on accounting and tax issues which are unique to energy enterprises and develop industry specific benchmarks based on leading practise.

Every tax authority in the world is short of cash and everybody wants your money. Our aim is to make sure that the tax take is as low as possible. It is a black art and requires constant attention to detail without losing sight of your overall objective of making a profit. One of the primary aims of the Energy SIG is to help us reduce our clients’ tax cost to the low-est reasonable level.

The Energy SIG is a platform from which common standards are delivered. Wherever our clients are going there will be a multiplicity of issues and the black art comes in melding these together so you have appropriate structures to ensure that everything you do is fit for purpose.

Businesses should always be asking the question: “Is there a better way of doing this?” If there is a Double Tax Treaty with the country in which you are operating it may set out the relationship between two companies and what can and can’t be done — and that can have significant implications for head office, not just the operation in the new country.

The challenge is to understand how these Double Tax Treaties work, how businesses can make full use of them and how the tax system works in the host country. In Aberdeen, we can’t pos-sibly know everything about what hap-pens in every country in the world, so we need friends, more importantly trusted friends, so that when new cli-ents begin working in new territories

such as Ghana or Greenland, where we recently had some issues, we are able to understand the tax and accounting of the country they are planning to do business.

It is our job to liaise with fellow Energy SIG members, ideally in advance of clients going to overseas jurisdictions, to put in place the most appropriate arrangements. Companies have to be properly organised and prepared for Transfer Pricing so if there is a challenge from the equivalent of HMRC in the host country, they have a comprehensive supporting dossier. If you are challenged and have failed to pre-pare properly, the fines are considerable. It is critical to have have a strategy and to understand it. You need to monitor it constantly.

Another major issue is how to get your money out once you have paid your tax. This is often not as easy as it might seem and you need to understand the regime in which you are operating. Sometimes you have a Double Tax Treaty to help you but Brazil, for example, doesn’t have one with the UK and this can cause dif-ficulties. Mexico is slightly easier and in the US and Australia we are operating in more familiar territory.

Whatever country you are operat-ing in, you have to clearly understand the rules particularly if you don’t plan to use the money to expand and want to repatriate your profits. Then there is the problem of how you handle this in the UK — how does the related tax and accounting work?

The answer is, that it is extremely complex and a lack of preparation can be costly. We believe the Energy SIG is going to help us to ensure that wher-ever our clients head in search of energy resources we can provide the appropriate tax advice to help their cash flow by mini-mising their tax burden.Ian Williams, an international tax expert, is chairman of leading independent account-ants Campbell Dallas, and has recently joined the firm’s Aberdeen office. He is the driving force behind the newly formed UHY Energy SIG.

Inside ...Where’s the fresh talent?Major players set out to address a skills shortfall and attract new graduates Page 4

CommentaryPeter Jones on a market that faces a challenge Page 5

Cover storyHelix Well Ops’ ongoing journey to success reaches the coast of west Africa Page 8

Special reportThe subsea sector ticks all the boxes but deserves a level playing field Page 10

Businesses should always be asking: is there a better way of doing this?

The Energy Special Interest Group will meet for the first

time in Houston at the Offshore Technology Conference

Whether operating in the US or Africa, keeping ahead of the game is crucial when it comes to diverse tax rules writes Ian Williams

The towering challenge of tax requires friendly advice

© visithoustontexas.com


Power of Scotland4

View our interactive edition online

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It may seem slightly perverse, but — even in a recession — the oil and gas sector continues to be chal-lenged when it comes to obtaining individuals with the right skills to meet its needs. Matching the supply of talent, particularly from schools and universities, to the require-ments of companies is one of the biggest issues facing the industry.

Serious questions remain about how to ensure that the next generation of engi-neers and other technical specialists see a career for themselves in hydrocarbon fuel exploration and production — especially in light of growing competition for gradu-ates in particular in competing areas such as renewables.

The problem is not a particularly new one but capturing new engineering talent is taking on an urgency as the current generation of employees in oil and gas move towards retirement.

One of the main issues faced by oil and gas employers is that many graduates

who have studied much-needed STEM (science, technology, engineering and mathematics) subjects then go on to take up non-technical careers in areas such as business management and financial services.

Another is the continuing public per-ception that oil and gas careers involve long periods of time on isolated and windswept North Sea platforms while heaving mud-coated drilling bits around. The sheer breadth of opportunity avail-able within the sector is not always appreciated.

The oil majors are working hard to change this, and in doing so, they are having some success. BP, for instance, is taking on nearly 250 graduates this year as well as almost 140 interns. Accord-ing to the company’s head of graduate recruitment in the UK, Emma Judge, the problem isn’t the number of students coming through university: it’s the fact that competition for them is so fierce.

“This year, the number of people we are looking for has gone up, but so has the number of applications,” she explains. “We haven’t had any problem filling the vacancies.”

Part of the reason for this, she believes, is that BP is a strong brand which offers excellent career prospects across a range of engineering, technical and non-busi-ness disciplines. The company has a num-ber of programmes in place encouraging both school pupils and undergraduates to consider working in the sector. Some of these, such as its Ultimate Field Trip team contest for university students, promotes

opportunities in the oil and gas sector to STEM students: this year’s challenge was to develop a plan to create the first zero carbon oil refinery by 2030. The prize is an eight week paid internship to Trinidad and Tobago and a visit to the company’s operations in the Gulf of Mexico.

Other BP initiatives include Discov-ery Days which allow undergraduates to spend a full day with the company to see if their skills and personality fit the industry; and, at school level, teacher resources and enhancement of the local curriculum.

Those who join the company are placed on a programme called Challenge which oversees their professional and personal development and introduces them to the ethos of the company. They then progress through a three to four year syllabus involving close personal mentoring.

“It’s up to us to ensure that the oppor-tunities we offer are attractive,” says Judge. “I think we do have a strong prop-osition. We are going to continue to need good engineers and scientists and our long term plan is to increase our number of graduates. We are keen to invest in our future talent programme.”

Shell is another major operator which has a well developed recruitment pro-gramme in place to ensure it captures both those with new degrees and experi-enced engineers.

“We have very robust and well devel-oped initiatives and have a significant recruitment programme for graduates,” says Sjoerd Brouwer, the company’s wells engineering manager.

“We need to ensure a career in the industry appeals to youngsters,” he says.

It is easier to get the right people now than it was five years ago when the profile of the industry was less well known, he says. Like its competitors, Shell faces the issue of persuading STEM graduates that they can have a hugely rewarding career by staying within a technical industry and ensuring their core skills and knowledge are well used.

In this day and age, recruitment is also about persuading youngsters in particu-lar that a career with a traditional hydro-carbons company can appeal in terms of environmental responsibility.

“Our core values are built around sus-tainable development — we have to be a good citizen,” Brouwer says. “We invest in projects with a low environmental footprint — we are a keen advocate of gas, for instance, which is a clean source of energy, as well as carbon capture and storage.”

He concedes that it remains a chal-lenge to get the message across to schools and universities that hydrocarbon fuels will fulfil energy demand for at least the next 50 years and that companies like Shell have a strong role to play in this.

“The fact is that this is not an old, dirty industry. We are continuing to invest in alternative sources of energy as well as in finding the most efficient and responsible ways of obtaining energy from fossil fuels.

“We are also interested in working with communities, governments and NGOs in order to ensure that our plans are accept-able and add value to the wider society.”

Despite the sector’s problems with recruitment, some firms are having success in changing graduate perceptions, writes Andrew Collier

This is not an old, dirty industry. We are finding the most responsible methods of obtaining energy

Despite a shortfall in the industry, it is easier to get the right people now than it was five years ago

Where are the new engineers queuing up for these jobs?


Bryan Innes, Senior Client Partner

CommerCIal rePort: toWrY

advice that brings innovative approach to executive rewardsR

ewarding and just as impor-tantly, retaining directors and key senior executives has never been more topical. Political point scoring and sensitivi-ties over the payment of large

bonuses and pay rises for directors come at a time of large-scale austerity measures. Private employers though, have the right to pay what they believe is the going rate for individuals who are crucial in driving the business for-ward – and employing many others as a result.

The questions that many employers are asking however is, what is the most effective way of rewarding and retaining these people? Employers are now looking at adopting an innovative and paternalistic approach to financial well-being that ensures these key members of staff make the most effective use of their remuneration, rather than simply leaving them to make financial decisions themselves.

Employers already engage in executive health screening therefore it seems only appropriate that they look at the financial wellbeing of their key staff. Until now concerns over impartiality and commission bias has resulted in employers being nerv-ous of introducing advisers to their key staff. Ensuring that the advice is dispensed by professional fee only advisers should alleviate this concern.

There are three key issues at present where obtaining impartial financial advice has never been more important:

Continued investment/market volatil-ity affects existing investments, potentially affecting an individual’s financial plan and therefore their personal objectives.

Changes to tax and legislation resulting in higher tax rates, pension changes and restrictions to income tax reliefs all need to be reviewed.

The final point is in relation to the advice sector with the rules arising from Financial Services Authority’s Retail Distribution Review (RDR), which will be implemented in January 2013. Regulation will come into force which will see changes to advisory remuneration (banning of commission) and the increased requirements on adviser basic qualification levels.

These two changes alone will dramatically affect many advice firms and some analysts are predicting a reduction in adviser numbers by as much as 40%. Working with a firm that is committed to RDR and has the scale and capability of dealing with directors and senior executives will be of significant benefit to high earning employees, ensuring that both the employee and employer get the maximum value from the reward.

Staff engagement is an ongoing challenge for employers, with those at the top and bot-tom of the pay scale particularly affected. By employing a professional adviser to deliver impartial financial planning you are introduc-ing a new and innovative approach to reward. Advising senior executives with complex affairs and high demands requires specialist

financial planning skills, where the adviser remuneration needs to be impartial. Advice needs to be delivered by professional fee-only advisers whose sole focus is on advising the individual. Asking the employee benefits adviser to advise the Chief Executive is like asking your GP to carry out heart surgery.

Helping people to identify and understand their strategic financial objectives takes time. Key employees are naturally focused on the business strategic objectives, understanding and managing the risks whilst being able to deliver success. They will know what success looks like year in, year out.

These questions are a given for many sen-ior employees, yet how many would be able to answer the same questions for themselves personally? How can they achieve financial success if there is no plan? Individuals will be at different stages in their personal and business lives and it is important that they are able to identify and understand their own strategic objectives so that they can plan ac-cordingly. At Towry our approach is to work with private individuals to achieve their strategic financial objectives with the least amount of risk.

Towry is a leading UK firm of Wealth Advisers that are retained by a number of pri-vate and public sector companies to deliver fee-only financial planning advice to their directors and senior executives. Bryan Innes is a Senior Client Partner at Towry and can be contacted on 01224 615080.

Anyone m aking the long trek up to Caithness to visit John O’Groats will see something quite remarkable a few miles north of Wick. When I saw it,

I thought it altogether more impressive than the dismal collection of buildings that comprise Britain’s most northerly mainland village.

You see it from some way off, but it only becomes apparent what it is when the road rises over it on a bridge. Beneath the bridge are little railway tracks on which big yellow pipelines on little bogies sit. The tracks stretch into the distance, the longest being 7.7km.

This is where Subsea 7 assembles oil and gas pipelines in 7km lengths, the fi nished pipes being eventually lugged out to sea across the adjacent beach. Were it in central Scotland, I suspect it would be a sightseeing attraction. As it is, it demonstrates the enormity of some the challenges facing subsea engineers.

It is also the most visible sign of what has become a major Scottish success story — designing, building, operating, and maintaining the subsea wellheads and associated underwater equipment that is increasingly important to the offshore oil and gas industry.

Today in the North Sea, about 45 per cent of production is through subsea wellheads which are either tied back to hub platforms or operated through a fl oating production, storage, and offl oading system. As exploration and production has moved into deeper and more hostile waters, so innovation and know-how has developed to make Britain a leader in subsea technology and Scotland the host to most of the world-leading companies.

As the rest of the world increasingly looks offshore for new sources of oil and gas — in the Caribbean and Mediter-ranean Seas, off Brazil, west Africa and Sri Lanka — so there is a growing opportunity for these companies to cash in. Recent sales trends of Scottish companies (see chart) make a couple of important points.

One is that even though peak produc-tion occurred more than a decade ago, the value of the market for equipment and expertise in the UK Continental Shelf is still growing. The second is that the market in the rest of the world is growing rather more quickly. Interna-tional sales were 28 per cent of the UK oil and gas supply chain’s total sales in 2001, but by 2009, they were 45 per cent.

The subsea sector is an important part of this story. Scottish Enterprise reckons there are about 800 Scottish companies involved in it to some degree, producing about £4 billion of products and services and having the potential to grow at 20 per cent annually.

But just as there are opportunities, there also challenges. One which is hampering growth and is probably top of most companies’ list of worries is an acute skills shortage. It seems extraor-dinary that in the subsea sector, where average pay is about £55,000 a year or twice the average UK income, there are

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vacancies. But Oilcareers.com currently lists more than 1300 subsea jobs, most of them in Aberdeen.

Partly, this is an industry-wide problem. The oil industry is seen as in decline, even though there are about 40 years more life in the North Sea and decades more world-wide. It is also viewed as dirty and dangerous, a percep-tion fuelled by the enormous media coverage of BP’s Deepwater Horizon disaster and Total’s current Elgin fi eld gas leak. And, especially to the young, the production of hydrocarbons for burning is seen as a prime cause of climate warming and eventual environ-mental disaster.

Beyond this, the talent pool coming out of our schools and universities is not deep. All manufacturing, not just the oil and gas sector, complains that the number of school leavers with decent qualifi cations in maths and the sciences is too low.

Efforts by the industry to change things, from the distribution of ingenious teaching kits to primary schools to persuading universities to offer new courses, are being made. But this will take a long time to bear fruit, too long for an industry which now has a bulge of technicians and engineers in their fi fties planning retirement.

Somehow the challenge has to be met. It is not just the oil and gas industry which needs subsea engineers, but also the clean technologies of the future — carbon storage, offshore wind, wave, and tidal power. Having the technology is one thing, but we also need the people to install and operate it.

The talent pool coming out of our schools and universities is not deep

Peter JonesEven this most visible sign of success faces a big challenge

Oil and Gas Supply chain sales

souRce: scottish counciL DeveLoPment anD inDustRY


Power of Scotland6

commercial report: Hunter adams

People are at the heart of our business, according to the corporate cliché. Yet statistics from the Chartered Institute of Personnel and Development (CIPD) reveal a different real-

ity: UK Employment Tribunals, arguably the best measure of employee happiness, received a total 218,100 claims during 2010-11, a staggering 44 per cent increase on 2008-09. So why do human resources problems hamper Scottish development?

The success of regional opportunities, such as Aberdeen’s sustainable energy corridor ‘Energetica’, pivots on the attrac-tiveness of our region and country.

But development visionaries often forget a region is only as attractive as the businesses within it. Attractive, engaging businesses become the destination. How often have you heard companies aspire to be like Google or Apple? We can recog-nise a great corporate culture when we see one but it remains frustratingly difficult to implement in an industry focused on nuts and bolts, oil and gas. My business specialises in turning these elusive but critical objectives into pragmatic recom-mendations and, most importantly, com-mercial results. Here’s what we’ve learnt.

Great corporate culture grows from rig-orous strategy. It would be inconceivable to lead a multinational business without a robust financial strategy, yet human resources strategy is the poor relation in the boardroom. This is ironic when you consider the cost of failing to engage with your workforce. Take, for example, an engineering business with 500 employ-ees and a turnover rate of 30 per cent per year. With the recruitment process potentially costing up to £50,000 per post, 150 positions a year could cost a company £7.5 million in recruitment, not taking other factors into consideration. In our experience, human resources is a critical commercial activity, with a hidden power to make or break a company.

Ensure you plan for it. If you talk the ‘people at our heart’ talk, learn to walk the walk. There is no substitute for face to face consultation. Real corporate change

is fuelled by conversations, not question-naires. It takes courage to understand what your employees really think and it can help to seek support to do this — but imagine having employee endorsement at the centre of your corporate strategy.

Managing mergers and acquisitions is essentially about managing people and managing culture. Last year, I led the $955 million Wood Group PSN merger from a people perspective and, despite natural apprehension, we retained a com-mitted, engaged workforce ready to share the chapter ahead. This year, we managed the restructuring of a refinanced business, halting a staff turnover level in excess of 50 per cent (on average per annum). The right strategy bears fruit.

Great corporate culture demands a flexible, creative way of working. The

Why great corporate culture demands flexible working

Why does HR hamper development and how can Scottish companies unlock potential to drive productivity and competitiveness, asks Dean Hunter

current economic climate demands ‘more with less’ from every business, from every industry. New flexible working mandates for employees are due to be implemented by the UK Government this year. But the same principles apply to industry dynam-ics. We have experienced an increase in our outsourcing services as management teams recognise the need for an industry expert, but without the overhead and commitment.

This is not old-style consultancy where a fresh-faced graduate in a sharp suit tinkers with your business, then leaves you to pick up the pieces. We have nearly 150 years of expertise combined in your industry and can be a publically recognised member of your team, or alternatively advise behind boardroom doors. The consultant has our full support while they are placed with a client company, allow-ing them to draw on the knowledge and expertise of the rest of company.

Flexible working extends to time. We might be involved for an intense three month assignment or for a period of a year or more. If we can do it, you can. I would urge you to challenge the assump-tion that every business needs an HR department, a marketing department and a logistics department. The one-stop-shop is an outdated and economically obese way of running a business. Flexible thinking and working has the power to increase productivity and create a happy and healthy business. This is not just for nimble SMEs. Innovation giant GE is one of the global companies leading the flex revolution within its businesses.

GE’s Susan Peters recently urged change: “There is a need to be less hier-

archical and rely more on teams. This has increased dramatically in the last couple of years ... the world isn’t the same, so we need new parameters.” This shift in thinking should be easy for us. The UK energy industry applies world-class ingenuity and breathtaking creativity to technological and engineering challenges day in, day out. Let’s apply the same fresh thinking to business support services.

We have abundant natural resources: The UK Government has set a target that by 2020 15 per cent of the UKs energy is to be sourced from renewables. The rest will have to be drawn from oil and gas. However, the UK is in the fortunate posi-tion that 40 per cent of our oil and gas reserves are still to be extracted. Under the right business conditions, the industry will continue to flourish and supply a significant proportion of the UK’s energy requirements to 2020 and beyond.

We have enviable economic resources: National accounting group UHY Hacker Young announced this month that Ab-erdeen has overtaken London to become the only major city in the UK that man-aged to grow its economy during the reces-sion. Its analysis of official calculations of ‘Gross Value Added’, the measure of a region’s contribution to the UK economy according to the value of the goods and services it produces, revealed that Aber-deen is the only Top Ten UK city where GVA per resident grew, rising 1.1 per cent from £28,442 to £28,731 in 2010.

But this is not quite enough. We will only unlock lasting the productivity and global commercial success of Scottish businesses if we develop the human resources to match.

dean Hunter challenges the dated one-stop-shop way of running a company and is an advocate of flexible thinking and working as a way to create a healthy business

Dean Hunter, an established figure in the Scottish human resources community, founded Hunter Adams in June 2011. Prior to this, as HR director at oil giant Production Services Network (PSN), he was responsible for around 8,500 employees in more than 20 countries. In less than two years he reduced the staff turnover of the company from 40 per cent to 7 per cent, propelling PSN into 50th place in the Sunday Times’ 2011 Best 100 Companies to Work For in the UK.

Hunter Adams delivers pragmatic human resources services to drive customer competitiveness,

profitability and growth in a wide range of industries. By the company’s 100th day of business, it had secured more than £400,000 worth of contracts for work in the UK, the US, Norway, Singapore, Azerbaijan and Australia. As the company approaches its first birthday next month, Hunter expects turnover to exceed £1 million.

He was recognised as Outstanding HR Director of the Year in 2008. He is co-founder of the Scottish HR network Employment Eye, a group with more than 200 members, and is a Fellow of the Chartered Institute of Personnel and Development (CIPD).

Resources that add up to growth


sean Buchan believes that the energy industry’s skills gap is a worldwide issue

The UK energy mix is evolving, fast. The exact composition is determined by the availability of natural resources, alongside environmental, political,

fi nancial and technological infl uences. By the end of the 21st century, the industry we know today will be unrecognisable. The BP Energy Outlook 2030 predicts that global primary energy consumption will increase by a staggering 39 per cent before 2030. This escalating demand for energy will mean changes in the industry overall and staffi ng logistics will become increasingly important.

In the 2011 Maxwell Drummond International Energy survey, participants recognised the looming problem of sig-nifi cant resource gaps in people and skills. Reservoir and petroleum engineering and drilling and fi eld operations are expected to be the areas most likely to be affected. Last year, BP publicly expressed concern about fi nding the right people with the right skills to complete new projects in the North Sea.

The lack of skilled personnel in critical areas isn’t just a UK problem, according to Sean Buchan, vice president for Eu-rope, Middle East and Africa at executive search consultancy Maxwell Drummond International. Buchan says: “We are wit-nessing a high demand for experienced oil and gas professionals on an international basis. The energy industry is inherently global; therefore it is common for workers

to move between energy capitals such as Aberdeen, Houston and Dubai for the right role. People with the right skills are a valuable commodity. There is no doubt the skills gap is a worldwide concern.”

The Asia Pacifi c region is increas-ingly demanding, in terms of both energy consumption and production. Australia has an increased focus on exploration and production (E&P) both onshore and offshore. However, the lack of experi-enced professionals in technical disci-plines could have serious implications on the timing of project development and completion.

Buchan continues: “In Australia, the skills gap in the natural resources market is extreme as the country is experiencing exponential growth both on and offshore. As more projects reach the sign-off stage, I can see labour shortages continuing for some time, particularly in the key techni-cal disciplines such as engineering, subsea and subsurface.

“Our Perth offi ce works with vari-ous Australian E&P companies, major contractors and service providers who are looking to recruit experienced individuals in the oil and gas industry from places like Aberdeen and Norway, markets which have a high concentration of subsea and offshore production expertise.”

The trend for deepwater developments is evident in Brazil, a region experienc-ing an unprecedented boom in E&P. The Government estimates that 250,000 workers will be needed for the develop-

call for right people in the right place

ment of new oil fi elds over the next four years. From Maxwell Drummond’s experi-ence, government red tape has historical-ly made it diffi cult to bring foreign talent into Brazil, though there are indications that this is changing. Buchan explains that stringent local labour practices, laws governing the importation of workers and an extensive work visa program all con-tribute to the pressures on recruitment.

“Visa issues have been a problem in Brazil but are thankfully are now much simpler. Previously, a company wanting to employ an expatriate had to prove the skills they were looking for were unavail-able locally. Nowadays, although a com-pany wanting to bring in foreign talent will still face paperwork, a work visa will be granted in 60-90 days if all the proper procedures are carried out. These small changes are vital in order for Brazil to meet its global potential.”

Africa has also benefi ted from an im-

commercial report: maXWell drummond

The lack of skilled personnel in critical areas is a global problem and needs innovative approaches to realisethe potential in the ever evolving energy industry

Distant horizons no obstacle to client serviceSean Buchan joined Maxwell Drummond in 2006 and has signifi cant experience in executive search at the most senior levels in the Natural Resources sector. His client base ranges across the full spectrum of the oil and gas supply chain. Buchan is currently responsible for leading the Europe, Middle East and Africa region. Prior to this he worked for a global recruitment business and was responsible for establishing its oil and gas practice.

Maxwell Drummond International is a global executive search consultancy. In a crowded market, Maxwell Drummond differentiates itself through its in-depth knowledge and experience across the energy industry, from oil and gas through

to mining and renewable energy.Founded in 1987 by Andrew

MacDonald, Maxwell Drummond has gone on to establish itself internationally and now has offi ces in London, Aberdeen, Houston, Calgary, Singapore (right), Rio de Janeiro and Perth. Maxwell Drummond’s client base ranges from the world’s leading energy companies and investment banks to mid-size businesses and start-ups.

proved regulatory regime. The continent as a whole has long been tainted by above ground risks and lack of a legal framework but as companies are gaining an under-standing of how to deal with the local political environment, more attention is being drawn to the newfound oil reserves says Buchan.

“As we would expect in an emerging market, new activity is leading to a talent shortage in the region. However, African countries are already making a signifi cant attempt to attract top managerial talent to the region. There has been a steady rise in both permanent and contract salaries and it is expected the increase in average executive compensation will continue.

While senior and middle management typically comprises expats, technical specialist roles are more commonly being fi lled by local citizens, an indication that developments in training the regional workforce are gaining pace. An increas-ingly common request from our African client base is to re-attract the national diaspora back to their home country. As the region matures we expect this trend to continue and become increasingly important.”

While changes in regulations are wel-come, often other solutions are required to attract and retain new talent to the oil and gas industry. In Canada, there is a increasing trend for workers with experi-ence in natural resource sectors to transfer their skills to the Canadian oil sands projects in order to plug the skills gap.

Ernst & Young’s Human Resources in Canada’s Oil and Gas sector report revealed that Alberta will be an estimated 77,000 workers short in the coming dec-ade, partly due to large projects such as those around Fort McMurray in Alberta and associated pipeline projects. While skills transfers can be a solution, Buchan urges the industry to be cautious.

“Some skills are less transferable, such as those of petroleum or reservoir engineers or people working in drilling and comple-tions who specialise in the Oil Sands market. Therefore, it’s important for the industry to attract the young qualifi ed en-gineers into the sector and into Canada.”

With evidence that a skills gap af-fecting some locations may last up to 20 years, he believes one solution lies in collaboration. “Geographical regions must now begin to share knowledge and experience, technology, business models, operations and maintenance practices to benefi t the industry, individual businesses and employees. This way, we will fulfi l the potential of each industry and secure the brightest energy future for all.”


Power of Scotland8

Cover story

experience and expertise not only forms the DNA of the Aberdeen business, but also its heart.

“The key to the success of our business lies with our people,” says Nairn. “Most of our clients recognise our core strengths are, of course, that we provide a good ser-vice but also that we are a steady ship; we have experienced and longstanding staff. The senior management team here, and also some of those in Houston, all worked on Seawell in the 1990s.”

That grounding, the strong sense of teamwork, has been essential to the development of Helix Well Ops. It has helped it through the challenges, along with the celebrations. Highly-skilled engineers and technicians they may be, but the Helix Well Ops management have also been part of a crew.

“For the first two years we barely broke even but the next few were very good for us,” continued Nairn. “At first we only had half-year utilisation; they were tough times. However, once we started to win the longer contracts, things began to pick up for us. We’ve seen a lot of change. To put some perspective on it, we used to have around a dozen staff onshore and a similar number offshore, plus a lot of sub-contracted workers. Now, we have 80 onshore and 300 offshore.

“Another aspect of our business that makes us unique is that we employ all those offshore workers. Before, and as is still the case in many parts of this indus-try, the majority of work would be done by sub-contracted staff. However, a cou-

ple of years ago we decided it would be better to employ all our offshore staff; it gives our workers a better sense of own-ership in our projects, and productivity is better, and because of good utilisation we can carry a high level of workforce.”

To help exploit the year-round utilisa-tion, Helix Well Ops commissioned a new vessel in 2009, the Well Enhancer, to work alongside Seawell. However, expand-ing the fleet was not enough, and Helix Well Ops have also begun to expand their horizons.

“Due mainly to the North Sea weather, winters can be lean,” explains Nairn. “So last year we made our first foray out of the North Sea, opening up the market in Africa, with a contract for Exxon Mobil.”

The three-month campaign in west Africa was the area’s first well interven-tion and subsea well operation to be carried out from a monohull intervention vessel, and it was also the deepest opera-tion conducted from Well Enhancer. The waters west of Africa are being developed fast, and the value that vessel-based operations — as opposed to rig-based work — can offer Helix Well Ops’ clients is clearly significant. This is because Sea-well and Well Enhancer can deploy much more quickly than a rig, and as they are specifically designed for well interven-tion, this means any down time on the well is reduced, allowing the client to resume operations more swiftly and get back to the demanding business of oil or gas production.

Speed, and the resulting cost savings,

Steady hand with keen eye on new discoveries

The deep, churning water of the North Sea does not give up its treasure easily. Of course, it is no longer just the chase for shoals of silver that pits man against such a treacherous envi-ronment; now, the

relentless pursuit of black gold has cre-ated not only a new offshore battlefront, but the engineering and technology nec-essary to grapple with it, and a whole new breed of worker to attempt to command it.

In addition to key elements such as innovation and skill, it is the grittier qualities such as bravery and tenacity that have also come to define Scotland’s oil and gas industry, and the men and women who work within it. Hardly sur-prising, then, that Europe’s oil capital now has such a global reputation for producing — and exporting — talented people, genuine industry leaders.

Helix Well Ops, the Aberdeen-based company that has driven the market for subsea well intervention, and now domi-

nates it, is a prime example. Strong, sleek, dynamic and powerful, the stars of the Helix Well Ops show are undoubtedly their hardy fleet, the MSV Seawell and Well Enhancer. Both are purpose-built well intervention and saturation div-ing vessels, with the Seawell, launched in 1986, in operation since 1987, and the bigger and more recently-launched Well Enhancer, in operation since 2009.

However, it’s not just the intrepid Sea-well that has been on a long, hard journey over the past 25 years or so. Helix Well Ops, as a company, is also much trav-elled. At the time of Seawell’s launch, the proud owners were Stena Offshore, later becoming Coflexip-Stena and then Tech-nip through a series of mergers. Follow-ing a sale of the Seawell to Houston based company Cal-Dive International in 2002. the business became Well Ops UK. With Cal-Dive then rebranded as Helix four years ago, Helix Well Ops UK remains as a business unit within the Helix Energy Solutions Group.

So yes, the branding may have changed, along with the ownership, but some things have remained consistent for this global leader in rigless well interven-tion. Each time the business moved on, the assets also changed hands, and that meant not only the Seawell, but the work-force too. Most of this small band had worked the vessel since the early 1990s, some even from the start of Seawell’s life in the late 1980s.

Steve Nairn, vice-president of Helix Well Ops UK, believes this wealth of

Last year we made our first foray out of the North Sea, opening up the market in Africa

Helix Well Ops is no stranger to stormy waters but has mastered them to gain a pivotal role in the subsea sector, finds Ginny Clark


are clearly a key element in the appeal of Helix Well Ops services, but it is also the wide range of work that can be carried out from the fl eet that has been crucial to their growth and reputation.

Oliver Willis, Helix Well Ops’ business delivery manager, says one of the reasons for their full order book and “unprec-edented demand” is the varied range of services that they offer.

“If you are too specialised, then you don’t last long,” he says. “You need to cover all the bases. We might be work-ing in one area in construction, running and tying in a new tree, in another on fi eld deconstruction, suspending wells and removing subsea infrastructure. Our range of experience supports that breadth of service we offer, from saturation div-ing, to well abandonment to complex logging and pumping jobs. We can run coiled tubing — and we’ve even picked up a Harrier from the seabed. We can and do work in new fi elds, but the bulk of our business is with ageing assets, production enhancement, well maintenance, carry-ing out well integrity checks, and in the decommissioning market.”

Leigh Beck, Helix Well Ops’ opera-tions manager, explains the benefi ts of this diversity. “It’s the classic business model — a fi nger in every pie,” he says.

Steady hand with keen eye on new discoveries“On one site, we can be involved in part of the creation from diving and construc-tion through to completion, we can help maintain the well, carry out repairs in the event of failure or improve the effi ciency, then fi nally decommission it. When there is a slump in one aspect, it can drive others.

“I think we’ll continue to do what we do well. Things have changed a bit now, in that we do have viable competition, which we didn’t have before, but we also have a healthy order book.”

Beck is a good example of how the MSV Seawell has served as an enabler for personal career growth. “It’s defi -nitely part of what makes Helix Well Ops unique,” he adds. “I came in through a sub contract, as a fi eld engineer. I would have very busy spells followed by quiet spells, when I would walk about the ship asking questions, or pop up on bridge, and as a result of my interest in the wider business was earmarked for a future job.

“That’s the really good thing about the oil industry, and the marine industry generally: there are very few remaining employment sectors where you can come in at the very lowest rung of the profes-sional ladder and be given the opportunity to work your way to the top, with further education at college when required.”

A well of experienceHelix Energy Solutions Group is an international oil and gas production and contracting services company. Its world headquarters are in Houston, USA, and it is listed on the New York stock exchange. Helix works mainly in the Gulf of Mexico, out of Houston, in South East Asia, from Perth, Australia, and in the North Sea, from Aberdeen.

Group subsidiary Helix Well Ops, is based in Dyce, Aberdeen, working primarily in the North Sea, the Mediter-ranean and in the waters o� west Africa.

As a global leader in subsea well inter-vention, well maintenance, saturation

diving, well abandonment and decom-missioning, Helix Well Ops provides fast, flexible well-management services. The market leader in rigless well intervention, Helix Well Ops has two purpose-built vessels, MSV Seawell and Well Enhancer, and currently employs around 80 people onshore, and 300 o� shore.

Helix Well Ops has worked for the majority of the main oil and gas producers within the North Sea, and has also been involved in a number of other projects. For example, Seawell and Well Enhancer have also retrieved planes from the sea on behalf of the MOD.

Nairn insists that collective experience, is also important to a sense of shared destiny. “We’ve always had good leader-ship,” he says. “Most of us have known each other for over 15 years now and get on well. We’ve seen the investment and we’ve seen the growth; this is defi nitely a good place to work.

“When we were bought in 2002, it was a new experience for us. We had previ-ously been part of a much larger local organisation. Helix could have put a new

team in over here, but we were tasked to be more self-suffi cient and to develop the business and market at a regional level with the existing team. It’s been a very rewarding past 10 years, and we are cer-tainly empowered to make key business decisions. There isn’t a big management structure overall, so it doesn’t slow down decision-making and that makes us faster on our feet. We have a good customer base and a good reputation — and we’re in this for the long-term.”

Steve Nairn says the company has seen a big increase in staff, both onshore and offshore

dundeerenewables.com


Power of Scotland10

Surf City is a tongue-in-cheek nickname for West-hill, the dormitory town west of oil city Aberdeen. There was no outbreak of brash Hawaiian shirts during the unseasonably high temperatures there in late March though: Surf is an acronym for Subsea

Umbilicals, Risers and Flowlines, staples of underwater engineering.

Westhill and Aberdeen host a world class cluster of subsea construction and engineering skills with international heavy-weights such as Technip and Subsea 7. Skills honed in the challenging environments of the North Sea — deep water off Norway

and somewhat shallower depths in the UK sector — underpin an industry that is usu-ally viewed in the corridors of power as a subset of oil & gas.

Which is an issue in itself, if anything can be said to be problematic about a fast growing, manufacturing, exporting collection of companies, that tick all the boxes on the UK and Scottish govern-ments dream lists. Subsea should be a poster child. Its sharp-end activity and supply chain support some 50,000 UK jobs and produces £6 billion worth of services and products annually from 800 companies.

“That £6 billion is around a third of an estimated £20 billion global market,” said Neil Gordon, chief executive of Subsea

UK, the Aberdeen-based industry asso-ciation which helps 250 member compa-nies to grow their businesses domestically and overseas.

“The UK is seen as the centre of excel-lence and many of the major subsea companies have their operational head-quarters here.”

Some 70 per cent of the global subsea vessel fl eet is controlled from these fi rms’ Aberdeen operations while Subsea UK calculates that 56 per cent of output is from exports. The strong manufacturing supply chain is spread throughout the UK: Scotland, and Aberdeen in particu-lar, is the epicentre, but there are strong pockets in north east, north west and south east England. Subsea UK has estab-

The underwater engineering industry is a poster child for UK growth, exports, manufacturing and jobs and deserves a level playing fi eld, Rob Stokes hears

Subsea surfs the wave of change

Special report: Subsea sector

Aberdeen’s position as an existing hub will benefi t from the North Sea’s role as a test bed for new underwater technologies


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lished branches in all three to encourage engagement between subsea companies and their supplies.

Underlining its reach and global cre-dentials, Subsea UK’s recent annual con-ference and exhibition attracted 3,000 delegates and it also helps to organise Australia Oil & Gas, covering a strong growth territory for subsea, and Subsea Asia in Kuala Lumpur. It will be involved in Rio Oil & Gas in Brazil later in the year.

“The industry is enjoying very strong growth,” Gordon said. “Aberdeen is one of the few UK cities that did not go into recession in the past few years, and one reason for that is subsea.”

Analysts at consultants Rystad Energy in Norway predict that annual output in the subsea industry could double globally to £40 billion over the next fi ve years. Even the Chinese economy would strug-gle to match that. All hunky dory then, but the UK industry thinks it could go further and faster given a stable tax envi-ronment for its energy customers and a level playing fi eld with other industries on grants and tax breaks for R&D invest-ment — more of which anon.

When Vince Cable, the UK Secretary of State at the Department for Business, Innovation & Skills (BIS) visited Aberdeen last autumn, he left ostensibly impressed by what he had seen and heard from the subsea industry. Subsea UK will press its case again this summer when it holds its annual parliamentary reception for MPs.

“We’re engaging more with BIS,” said Neil Gordon. “Though we are often seen as a subset of oil and gas, we obviously support a number of different industries

such as renewables. Many techniques honed in oil and gas — construction, cable laying, surveying — are applica-ble to offshore wind farm developments. Marine renewables such as wave and tidal energy schemes will also call on these skills.”

Subsea UK’s current theme is ‘Reach-ing Further, Going Deeper’ — which encompasses seizing global opportunities and reaching into untapped oil reservoirs in the utmost depths.

Some 35 per cent of UK offshore oil wells involve subsea equipment tied back through underwater fl owlines to existing infrastructure such as platforms that may be some way off. “But because technol-ogy is always advancing, we can reach further, go into deeper water at higher pressure and perhaps tap into smaller reservoirs that were uneconomic before,” said Gordon.

Enhanced oil recovery techniques are all the rage and subsea will play its role in developing and proving technologies that can be exported. Demand from defence and oceanography also point to a bright and diverse future that Gordon is keen to project to recruits and policymakers.

“We need a long-term government view on support for the energy industry, such as in Norway, and in Brazil, where a 1 per cent tax on oil and gas revenues gets put back into the system.”

The oil and gas industry, and by impli-cation subsea, was stunned by a politi-cally motivated £10 billion windfall tax on UK oil producers in the 2011 Budget. By contrast, the 2012 Budget gave the green light for companies to strike contracts

with Government over tax relief for the future costs of decommissioning obsolete oil and gas infrastructure.

It removed a signifi cant risk for North Sea investors and — coupled with incen-tives to boost investment in small fi elds, old ‘brownfi eld’ assets, and deep water fi elds West of Shetland — went some way to restoring confi dence after activity was dented in 2011 going into 2012.

Though reassured by the Budget, Gor-

don argues that subsea is an industry that merits being treated in its own right along-side creative industries, IT, life sciences and other offi cial ‘key’ sectors prioritised for government support for R&D and skills development. Or, for that matter, aero-space and cars, which tend to be favoured by governments because of the numbers they employ and their totemic status.

“If this rapid doubling in size of the global market materialises we want to be

Neil Gordon believes one reason for Aberdeen’s immunity from recession is its subsea sector


Power of Scotland12

Subsea pursues recruits to maintain momentumwell placed to capitalise on it and would certainly want a level playing fi eld with industries in other countries whose gov-ernments support subsea,” Gordon said.

This cannot be delivered under exist-ing grants and allowances, he maintains. “Government policy has been not to sup-port funding for the oil and gas sector. We argue that North Sea oil and gas will be here for at least the next 50 years. If we support it, it will be worth trillions of pounds”.

Large oil and gas operators invest for the best returns, so the “cloud hanging over the UK” for the past year because of long-term tax uncertainty had been unhelpful, he said. “We now have some clarity, and that is welcome. We may still see investment in the UK, but it will slowly shrink because of international competition for it. Operators investing bil-lions need to see that there will be a stable tax environment for 10 to 20 years ahead.”

In the early days of UK oil and gas, technologies and technical skills for developing the then large offshore fi elds were largely imported from America, proved in the Gulf of Mexico. Back then, major offshore operators such as Shell and BP used their own resources to develop large fi elds that were economi-cally attractive to tackle thus. They would look to outside project and engineering capability for particular products.

Action now revolves more around smaller, independent oil companies seek-ing to develop remaining, harder-to-exploit brownfi elds where the most easily extracted oil has been removed by the majors.

These players will rely more on ‘tieback’

developments that use underwater fl ow-lines to link subsea wellheads to existing platforms and other infrastructure to sep-arate out oil for onward transport. They rely more on the sub-contract market.

Extracting more from old fi elds places increasing demands on technology, par-ticularly at greater depth and pressure and at higher temperatures. This time though, most technology and solutions are home-grown, many springing from that world-class cluster in and around Aberdeen, whether UK or foreign owned.

As major operators look more toward larger fi elds in very deep water off Africa, Australia, Brazil, Asia and Gulf of Mexico, the North Sea is now the ideal test bed and launch pad for exported technology and know-how.

Aker Solutions, a leading global oil services company with a strong presence in subsea, has watched the story evolve. 30 years ago it provided the world’s fi rst subsea control system, for Shell’s Cor-morant fi eld. Its recent subsea contact wins include subsea connection systems

for A/S Norske Shell’s Draugen fi eld in the Norwegian sector of the North Sea. Demand for its products is growing, par-ticularly in developing countries, as the need for oil continues to outstrip supply.

Last year saw a 20 per cent increase to 1,100 in its UK subsea workforce and it is still recruiting across all activities from the shop fl oor to engineering, supply chain and manufacturing.

It has a strong graduate entry pro-gramme, extensive apprenticeships, and

If you want to get ahead, think deep. Subsea cannot get enough of the right skills despite o� ering long term careers with good rewards, scope for advancement and globe trotting. Some firms need hundreds more sta� over the next two years.

Industry association Subsea UK is pursuing short, mid, and longer term initiatives to help address this.

The immediate focus is on spreading know-how about conversion courses to equip engineers and technicians with relevant skills. Conversion can be quick as many engineers know project management, for example in rail and roads. The subsea specifics are tacked on.

Technicians are in high demand. Subsea UK trawls the military. A recent event near the two Morayshire RAF bases saw five companies present to 90 military personnel.

The association also collaborates with members on a common framework for safety training so anyone working in subsea will start

with a shared understanding of best practice.It is particularly useful for new recruits to the

industry including technicians from equipment manufacturers and others who normally fly a desk. Subsea UK expects it to raise performance in the industry.

With a view to the medium term, beer and pizza evenings in universities introduce engi-neering students to subsea, its innovations, high rewards, and long-term career potential.

For the longer term benefit of the industry, Subsea UK is actively engaging with school-children to sow interest in an exciting world of underwater technologies.

A website (www.inside-industry.org.uk) is set to introduce youngsters to new sectors, includ-ing renewables and subsea.

Subsea UK is also in talks with the European Space Agency, right, about educational events around the theme of outer space meeting inner space to draw on similarities in the challenges and technologies involved in both.

© esa

continued on page 14

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commercial report: ViKiNG Sea tecH

If what is involved in bringing oil and gas to shore remains a mystery to most people, then what goes on subsea remains even more of an enigma. Beneath the ocean waves is the arena in which Viking

SeaTech excels, providing a range of services based on 20 years of operational experience in some of the world’s harsh-est offshore environments. Previ-ously known as Viking Moorings, the company relaunched as Viking SeaTech earlier this month, with Group chief executive Bill Bayliss extending the company’s range of seatech services to meet the demands of the fast-changing energy sector.

In addition to the rebranding, the Aberdeen-headquartered company has built on its core marine equipment sup-ply and rental services to introduce new products and services. Viking SeaTech is now able to offer the full spectrum of rig move operations including rig posi-tioning, inspection, maintenance and support services and, for the first time, the provision of industry personnel.

The company is also extending its geographical spread. Currently operat-ing across key global markets with op-erational bases in Aberdeen, Stavanger, Singapore and Perth, Australia, Viking SeaTech’s plans are well-advanced to add Indonesia and the Gulf of Mexico to its sphere of activities later this year.

Each region within the company has a specific expertise which collectively gives the group its global clout. For instance, based in Stavanger, Wolfgang Wandl - mananging director Norway, runs one of the biggest operations in the Viking SeaTech group with 40 employ-ees, including marine support staff, and bases in Mongstad, Kristiansund and

Hammerfest. They are also one of the few companies in the world certified to inspect certain types of heavy chain and are specialist in mooring rigs with enormous spreads.

Norway’s expertise and track record was instrumental in Viking SeaTech re-cently winning the Ocean Rig tender for the rig Leif Eriksson. Elsewhere, Petter Nilsen leads the Viking SeaTech opera-tions in Singapore, recently securing the largest marine hire job ever awarded in Singapore with Van Oorde while, Chris Forde, managing director Australia, con-tinues to work with all the major oil and gas companies in what is an increasingly busy region. To meet this huge growth in demand he is currently overseeing the company’s move into new and larger offices in Perth next month.

Meanwhile, in Aberdeen, managing director for the UK and Africa, Duncan Cuthill, has set up a new marine con-sultancy department enabling Viking SeaTech to offer the full-spectrum of rig-moving services. As the UK oil and gas industry moves into deeper waters with a focus on pre-lay systems up to 2,000m, Mr Cuthill is optimistic about future projects not only in Shetland and other North Sea locations, but in the Mediterranean and west Africa working for UK clients.

Within the Group itself, a core set of values have been cemented into the Viking SeaTech psyche based on simple yet effective policies to ensure that everyone in the company operates in a safe, united and ethical way. This ap-proach forms an integral part of Viking SeaTech’s bold vision to become the best supplier of rig moves and mooring operations for the offshore oil and gas industry.

Bill Bayliss, Group Chief Executive of Viking SeaTech, is a man who relishes the cut and thrust of the business world: he enjoys having influence and making things happen. Throughout his career, which has seen him preside over large multi-national companies on both sides of the Atlantic, the Middle East and Norway. Bill has often resisted taking the easy option. Within days of taking the helm at Viking Moorings in September 2011, he launched a 100 day strategic plan that continues to propel the company forward. Bill’s quick, flexible approach to business owes much to his sporting abilities. He played cricket at a high level as a young man, enjoys golf and ski-ing on a regular basis and supports West Bromwich Albion. So what makes him tick?

How did you get into energy business? There was no master plan. The world was changing at a fast pace. At school, I was into sport and education wasn’t the highest priority for me although I did do well having a Masters Degree in Engineering. I was initially employed as a mechanical engineer and went to college at the same time. I started at the bottom serving my apprenticeship doing everything from paperwork, sales and finance. The exposure this gave me at a very early age, particularly in the nuclear and petrochemical industries, has stood me in good stead when it comes to the energy sector. It also taught me that no matter what your background or level within a Company, everyone has something to contribute.When did you begin your oil and gas career?I started work in offshore oil and gas industry in 1991 working with Brown and Root (B&R) in London and Aberdeen, then Kvaerner Engineering in Norway. I then returned to B&R in Aberdeen taking on various engineering, project management and operations roles, including a two year assignment in Canada as the General Manager to the Hibernia field. Work for Kellog B&R (KBR) as Business Manager for the Conoco Southern North Sea operations and latterly Global Operations and Maintenance Director followed. In 2004, I joined Petrofac to grow an engineering, procurement, construction and commissioning support business. As Vice-President, I managed five business units

with an annual turnover of circa $300 million and support staff of 1,800. Five years later, I moved to Dubai as Chief Operating Officer of Topaz Engineering before joining Viking in 2011. What are your key strengths? My key strength is taking people with me wherever I go. I don’t know why that is, I think it’s born out of respect and maybe for what I stand for. I’m not a ‘fence-sitter’ and like to shake things up. Quite often I play devil’s advocate just to move things on and bring about change, something that can be quite difficult for a lot of people to deal with. Since joining Viking SeaTech in September last year, what have you achieved?The organisation has been restructured and a new leadership team is in place. A set of values now underpins our new HSE QA and IT policies together with the Code of Business. One of my personal values that I feel passionate about is that we must be able to deliver a service to our customers without compromising the legal or Health, Safety and Environmental (HSE) aspects of our work. It’s our number one value.

On the financial side, we have completed the financial restructuring which has injected a significant amount of money to enable and support our planned activities. Our balance sheet is robust and secure.

We have also developed a number of strategic initiatives called the Viking V to underpin our drive and commitment to evolve, change and grow the business. Key to this will be new services such as manpower and survey and positioning together with country entry into Indonesia and the Gulf of Mexico.So what about the future?I want to maximise the opportunities created in the restructured business to strengthen our global position in the oil and gas market. I also want to wisely manage our capital investments.

We have the backing of one of the world’s great banks in HSBC. This provides considerable financial security and it also places a significant responsibility for us to deliver growth and deliver shareholder value. This will take hard work, commitment and talent – attributes that Viking is already known for. However, I am confident that the foundations we have in place will allow us to build a much stronger business so that Viking SeaTech will become a genuinely global market leader in 2012.

Bill Bayliss, Group chief executive of

Viking Seatech

a new name and fresh horizons for Viking


Power of Scotland14

has recruited successfully in the UK from the military and also the shipping and car industries while tapping into surplus NASA space agency personnel in the USA.

“Competition means it’s tough getting the people we need in Aberdeen,” says Matt Corbin, managing director of Aker Solutions, who runs its subsea division in the UK. “The city’s got fantastic skills, but they’re in high demand.”

The flipside is that anyone relocating to Aberdeen knows there will be other employers to offer top dollar if they wish to switch companies. “I moved here and love it,” said Corbin. “Subsea is dynamic and high spec.” Through Aker’s Norwe-gian parentage, Corbin notes Norwegian oil and gas operator Statoil leading the way in subsea compression of gas and separation of hydrocarbons. “We have a great relationship and will be working with them on the first subsea compres-sion stations in the North Sea. You can guarantee if that’s a success, as we think it will be, then it will go worldwide.

“Aside from the oil, there is a lot of decommissioning of old infrastructure to follow, and a lot of our skills will naturally flow into renewables.”

Business is good too at Westhill based Proserv, a leading international energy company employing more than 800 people in 10 countries and 21 sites. “The business climate is good and we are still creating jobs worldwide,” CEO David Lamont said on his return from a trip to the Middle East. “A lot of projects that were delayed are starting to firm up.”

Proserv is ready. It has welded five

operating groups together in a year and recently saw Alex Salmond, the Scottish government’s First Minister, open the company’s new 27,500 sq ft subsea test and assembly facility. It doubles capacity and is thought to be the UK leader based on size and capabilities.

In May, Proserv will be at the flag-ship Offshore Technology Conference in Houston, Texas, presenting its uni-fied face and showing off new technol-ogy. This includes a multi-string cutting system developed in Scotland but with worldwide applications where subsea wells are being abandoned. It is a timely development after the Gulf of Mexico fatalities and massive oil spill in BP’s Macondo field.

The integrity of existing and obsolete wells and installations is a concern for the industry, regulators and the public and will move increasingly centre stage

as more fields reach the end of their lives, creating more work for subsea. Proserv’s main focus though is on the inde-pendent, second and third generation oper-ating companies developing brownfields.

“Our edge is in our response time,” Lamont said. “Big operators spending a billion dollars on a development naturally take a long time over it. Smaller compa-nies want to act quickly and we can get fit-for-purpose small systems designed and in place quickly.”

He is another convert to Aberdeen. “This city and its environs are leading the world in subsea. There’s a tremendous skills set and a skills shortage. There’s been great investment by the industry here, including a lot of small, entrepreneurial technology companies. There’s something about Scotland that supports these.”

While recruiting experienced peo-ple, Proserv also trains its own. It has a graduate fast-track programme and is impressed enough with Scotland’s apprenticeship scheme to use it as its standard model worldwide.

Lamont commends the industry to technical graduates. When Alex Salmond visited, he quoted estimates that 50 per cent of the value remained in the North Sea even if more than half of the oil had gone.“There could be even more there,” Lamont said. “It will take longer and a lot more technology than in the early days, and it’s all home grown technology and knowledge that is being exported glob-ally. If you start a career today in oil and gas you will retire in oil and gas.”

Both Corbin and Lamont take the view that as strong contributors to the national

economy, employment, exports and train-ing, subsea companies should qualify for R&D grants and incentives available to engineering firms in any other sector.

Oil and gas is a conservative industry by nature, and for good reasons when the environmental and financial risks are high. Technology therefore tends to evolve incrementally and with little stand-ardisation, and engineering comprises a high proportion of hours on any project.

David Pridden, chief executive of the Aberdeen-based National Subsea Research Institute (NSRI), an organi-sation in waiting, would like to see this change in some areas. “We’re about revo-lution, not evolution. We’re asking how we bring across ideas from other fields of science such as medical technologies and apply them to subsea.”

NSRI is being developed by the Uni-versity of Aberdeen, the Robert Gordon University (Aberdeen) , the University of Dundee, Newcastle University and Sub-sea UK to provides a focus for R&D as

Proserv has welded five operating groups together in a year and has doubled test capacity

The reason we have such a thriving subsea industry is because of things we did when we had perfect market conditions

continued from page 12

The Times Scotland - Power of Scotland (Issue 2)Published date - Tuesday 26th June

Focus 1: The Technology Innovator! How can technology help secure our energy future?

In the June edition the Power of Scotland looks at the technology and innovations that are being applied to the oil industry, from the seabed to the desktop, to improve efficiencies and pro-long the life of the oil resource.

Focus 2: Energetica - Home of the Next Age of Energy!

Energetica is an ambitious and exciting plan involving the public and private sector that will create a “new generation energy community” that stretches north from Aberdeen’s Bridge of Don area to Peterhead and west to the airport.

In the next edition we talk to Energetica Project Director, Sara Budge, who is driving this exciting and innovative initiative that will play a significant role in attracting inward investment and the creation of employment - through the attraction and development of skilled people from the oil industry.

The Times Scotland - Power of Scotland (Issue 3)Published date - Tuesday 2nd October

Focus 1: Subsea Global Activity

UK subsea firms have a reputation for subsea excellence and are in an ideal position to take advantage of the emerging opportunities in areas such as Brazil, Australia, Russia and the Arctic?

The Power of Scotland meets the leading companies in the UK Sub-sea market to discover how they have driven the industry to become global pioneers.

Focus 2: Scotland continues to lead the world in renewable energy

Scotland is increasingly being recognised as the global leader in the renewable energy sector. In this feature the Power of Scotland talks to the people and organisations that have earned Scotland this international standing in the sector.

Promote your business in the next issue of Power of Scotland

For more information on how to advertise please contact Neil Girvan T: 0141 335 9066 E: [email protected]


Oil and gas needs support with skills gap

Transformation training is the biggest human resource issue for the wider Oil & Gas industry, reckons OPITO, an Aberdeen-based, industry and trade union led, skills, training and workforce

development organisation that delivers solutions in 32 countries as the de facto global benchmark for safety training.

“There’s a big issue around mid-tier experi-ence,” said Larraine Boorman, managing director. “The sector is mature with much experience likely to retire in five to 10 years. We have developed initiatives to attract youngsters, but the mid-gap of maturity and experience is becoming a real problem.”

One obstacle, she believes, is that people do not always imagine that their technical, engineering, geology, science and other skills are transferable.

OPITO devised a 12-week Transformation Training programme based in Kinloss, Moray-shire, which grafts on energy industry skills as well as safety qualifications. It is successful, but small scale.

“The next stage is for industry to provide more detailed understanding of its needs so we can scale up to full potential,” Boorman said. OPITO researchers are focusing on younger ages but could soon include older demographics.

The organisation is in early talks to embed training into the UK government review of Post-16 education so it may be hopefully be jointly funded by government in colleges as a strategic contribution to a key growth sector.

“The Department for Business, Innovation and Skills seems keen but the timetable is unclear,” Boorman said.

Addressing general concern about lack of science, technology, engineering and maths skills, OPITO is working with primary schools. It is developing an initiative to provide teachers

with ready-made science lessons, some featuring hydrocarbons.

Boorman added: “We have industry support, but further work is needed to educate the education system to understand that innovative solutions like this make it more exciting to learn and for youngsters to understand the sector.”

well as skills training and education.Supported by the UK Government

and 20 companies, its research strategy and priorities are formed by businesses on its board and its Subsea Technology Advisory Group. The goal is to help the industry achieve strategic aims in a cost efficient, co-ordinated fashion so that there is no duplication of effort and wasted funding.

Examples cited in its prospectus include improving sensitivity of seabed monitoring and a way to detect just a few molecules leaking for a pipeline. A whole panoply of technologies could be applied to inspec-tion, data monitoring and management, and communication with subsea systems.

“The reason we have such a thriv-ing subsea industry is because of things that we did when we had perfect market conditions — deep water developments in the Norwegian sectors and shallower ones in the UK sector,” Pridden said.

“Now the UK is a mature oil province and the deep water focus is switching to West of Shetland. So NSRI’s focus will be on keeping existing stuff going and devel-oping small fields.”

Post-Macondo, there is also increased emphasis on the integrity of subsea sys-tems and components, and on perfor-mance. The main research focus globally is on flow, subsea separation and processing of hydrocarbons, and power, and the horse had already bolted on these, Pridden said.

“So NSRI will look at integrity and per-formance as applied to the North Sea, but ultimately exportable if new technologies can be developed. Our goal is to have that in the next three to four years.”

Larraine Boorman says that the lack of maturity and experience is becoming a problem

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Well Ops UKHelix House, Kirkton DrivePitmedden Road Industrial Estate, DyceAberdeen, AB21 OBGUnited KingdomT: +44 (0)1224 351800F: +44 (0)1224 351801

[email protected]

The global leader in subsea well intervention

Well Ops UKHelix House, Kirkton Drive, Pitmedden Road Industrial Estate, Dyce, Aberdeen, AB21 OBGT: 01224 351800 F: 01224 [email protected] www.helixesg.com

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The Challenge

We’re innovating You

We’re recruiting

BP

We’re investing

We’re innovatingFor over 40 years, BP has been operating in the North Sea. To be successful, we’ve had to be innovative, as we explore and develop its valuable energy assets.

We’re investingThe North Sea is a major business for BP and we are currently investing at the highest annual level for more than a decade, with four major new field development projects underway in the UK and two in Norway.

We’re recruitingWith challenging and varied work, in a wide variety of geological conditions, you’ll get best in class training and development, whilst working alongside hugely experienced colleagues. With a highly competitive package, flexible working hours, and a friendly and welcoming culture, there’s no better place to progress your career and develop as an expert.

BP is an equal opportunities employer.

Are you up for the challenge?bp.com/northsea

5681_BP_North_Sea_2_338x264.indd 1 11/04/2012 15:51

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