9
Role of the consultant in offshore oil industry projects J.F. Head, B.Sc, Ph.D.. C.Eng.. F.I.Chem.E., F.lnst.E. Indexing terms: Engineering administration & management, Project & production engineering Abstract: The complete process of evaluation, planning, design, construction and installation of an offshore project is one of the most complex and demanding engineering tasks of modern times, utilising the combined skills of a wide range of engineering disciplines. With the growth of the offshore industry the consulting engi- neer has found himself increasingly involved in all aspects of offshore engineering, from the preparation of the initial feasibility studies to the provision of assistance in the operation of the completed facilities. The consulting engineer's primary role is to provide advice, based upon his knowledge of current and developing technology and the best available industrial practices, using an objective, unbiased approach. The expression of this advice frequently takes the form of a feasibility study for a complete new oilfield development scheme or for individual sections of the proposed production facility or offshore platform. When the project proceeds, the role of the consulting engineer may include preparation of the conceptual design, specification writing and detailed engin- eering design, tender preparation, evaluation and advice on selection of the contractor. The consultant may also be called upon to provide project management services, monitoring progress and costs and verifying per- formance against specification, during the detailed engineering and construction stages of the project, and to provide advice and assistance during commissioning. Other specialist services provided may include technical audits, hazard analysis and safety audits, environmental studies, survey and inspection services, quality assur- ance and certification and provision of training courses for the client's personnel. During the operating life of an offshore field, the consulting engineer may provide services to monitor the performance of production facilities, including equipment and structures, and provide advice on remedial work, expansion, repair and maintenance, and on any modifications which may be required as a result of changes in reservoir performance, changing economic conditions or new legislation. As the offshore oil industry finds it necessary to prospect for future oil and gas production in deeper waters and increasingly hostile environments, and as the larger offshore reservoirs are depleted and reserves become concentrated in smaller and commercially marginal fields, a high degree of technical innovation will be required to ensure the safe, reliable, environmentally acceptable and commercially viable offshore production of hydrocarbons. Participation in these highly complex and costly developments promises to expand the role of the consulting engineer, especially in such areas as research and development, including the preparation of studies and monitoring test programmes for industrial clients, and through joint industry and government-funded development studies. 1 Introduction The history of the offshore oil and gas industry is a rela- tively short one. Possibly the earliest offshore production of oil to which reference can be found was the develop- ment undertaken by Lago Petroleum in 1929, involving oilwells supported on wooden and concrete platforms in water depths of up to 15 m in Lake Maracaibo, in Vene- zuela. By 1934 the same company was building steel and concrete structures to support wells in somewhat deeper waters, also in Lake Maracaibo. In 1937 the Creole field was developed in shallow water off the coast of Louisiana, with the oil-wells and some pro- duction equipment supported on timber piled structures. Following these and a number of similar early develop- ments, the oil industry's offshore operations remained essentially at a standstill until 1946, when a number of new developments commenced off the coast of Louisiana in water depths of up to 16 m, first using platforms con- structed of a combination of timber and steel piling and rapidly progressing to the use of tubular welded-steel structures readily recognisable as the forerunners of today's conventional offshore steel platforms. Throughout the following two decades many more off- shore oilfields were developed, mainly in the Gulf of Mexico, but also in other areas of the world, including the Arabian Gulf and off Nigeria and Indonesia, and during this period the techniques for prefabricating and installing steel offshore platforms were extensively developed. Almost Paper 33O6A (M3, M4), received 7th February 1984 The author is a director of Ewbank Preece Oil & Gas Ltd., Prudential House, North Street, Brighton BN1 1RW, England all offshore developments during this period were in rela- tively shallow waters, in locations where climatic condi- tions were mild and wave heights small. Most were primarily oil-producing facilities, with fairly low pro- duction capacities falling in a range which extended to a few tens of thousands of barrels per day, and usually involving simple equipment for processing oil only, since any unwanted gas produced with the oil was normally dis- posed of at the production site by 'flaring'. In these devel- opments, extensive use was made of 'off-the-shelf packages of drilling and production equipment of the type conventionally employed in onshore oilfields. Offshore, this equipment was mounted in the open on simple, flat, platform decks. The resulting platform weights fell mostly in a range up to 3500 tonnes for the steel-piled structures and 2000 tonnes for the decks and production equipment. The next major phase of offshore development involved North Sea oil and gas, and provided the oil companies with a far more difficult task than anything which they had previously encountered. The environmental conditions were much worse, water depths much greater, wave heights and resulting wave forces on structures substantially larger, and weather conditions generally hostile. In addi- tion, the new fields were further from land than any pre- vious offshore developments. Serious interest in the North Sea as a source of hydro- carbons was first aroused by the discovery of gasfieldsin the relatively shallow waters of the southern area during the middle 1960s. A number of fields in the UK sector, some 25 to 70 miles off the Norfolk/Lincolnshire coast, with local water depths of up to 30 m and maximum wave heights close to 17 m, were quickly developed using pre- fabricated steel platforms and process technology based IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984 397

Role of the consultant in offshore oil industry projects

  • Upload
    jf

  • View
    218

  • Download
    2

Embed Size (px)

Citation preview

Page 1: Role of the consultant in offshore oil industry projects

Role of the consultant in offshore oilindustry projects

J.F. Head, B.Sc, Ph.D.. C.Eng.. F.I.Chem.E., F.lnst.E.

Indexing terms: Engineering administration & management, Project & production engineering

Abstract: The complete process of evaluation, planning, design, construction and installation of an offshoreproject is one of the most complex and demanding engineering tasks of modern times, utilising the combinedskills of a wide range of engineering disciplines. With the growth of the offshore industry the consulting engi-neer has found himself increasingly involved in all aspects of offshore engineering, from the preparation of theinitial feasibility studies to the provision of assistance in the operation of the completed facilities. The consultingengineer's primary role is to provide advice, based upon his knowledge of current and developing technologyand the best available industrial practices, using an objective, unbiased approach. The expression of this advicefrequently takes the form of a feasibility study for a complete new oilfield development scheme or for individualsections of the proposed production facility or offshore platform. When the project proceeds, the role of theconsulting engineer may include preparation of the conceptual design, specification writing and detailed engin-eering design, tender preparation, evaluation and advice on selection of the contractor. The consultant may alsobe called upon to provide project management services, monitoring progress and costs and verifying per-formance against specification, during the detailed engineering and construction stages of the project, and toprovide advice and assistance during commissioning. Other specialist services provided may include technicalaudits, hazard analysis and safety audits, environmental studies, survey and inspection services, quality assur-ance and certification and provision of training courses for the client's personnel. During the operating life of anoffshore field, the consulting engineer may provide services to monitor the performance of production facilities,including equipment and structures, and provide advice on remedial work, expansion, repair and maintenance,and on any modifications which may be required as a result of changes in reservoir performance, changingeconomic conditions or new legislation. As the offshore oil industry finds it necessary to prospect for future oiland gas production in deeper waters and increasingly hostile environments, and as the larger offshore reservoirsare depleted and reserves become concentrated in smaller and commercially marginal fields, a high degree oftechnical innovation will be required to ensure the safe, reliable, environmentally acceptable and commerciallyviable offshore production of hydrocarbons. Participation in these highly complex and costly developmentspromises to expand the role of the consulting engineer, especially in such areas as research and development,including the preparation of studies and monitoring test programmes for industrial clients, and through jointindustry and government-funded development studies.

1 Introduction

The history of the offshore oil and gas industry is a rela-tively short one. Possibly the earliest offshore productionof oil to which reference can be found was the develop-ment undertaken by Lago Petroleum in 1929, involvingoilwells supported on wooden and concrete platforms inwater depths of up to 15 m in Lake Maracaibo, in Vene-zuela. By 1934 the same company was building steel andconcrete structures to support wells in somewhat deeperwaters, also in Lake Maracaibo.

In 1937 the Creole field was developed in shallow wateroff the coast of Louisiana, with the oil-wells and some pro-duction equipment supported on timber piled structures.Following these and a number of similar early develop-ments, the oil industry's offshore operations remainedessentially at a standstill until 1946, when a number of newdevelopments commenced off the coast of Louisiana inwater depths of up to 16 m, first using platforms con-structed of a combination of timber and steel piling andrapidly progressing to the use of tubular welded-steelstructures readily recognisable as the forerunners oftoday's conventional offshore steel platforms.

Throughout the following two decades many more off-shore oilfields were developed, mainly in the Gulf ofMexico, but also in other areas of the world, including theArabian Gulf and off Nigeria and Indonesia, and duringthis period the techniques for prefabricating and installingsteel offshore platforms were extensively developed. Almost

Paper 33O6A (M3, M4), received 7th February 1984

The author is a director of Ewbank Preece Oil & Gas Ltd., Prudential House,North Street, Brighton BN1 1RW, England

all offshore developments during this period were in rela-tively shallow waters, in locations where climatic condi-tions were mild and wave heights small. Most wereprimarily oil-producing facilities, with fairly low pro-duction capacities falling in a range which extended to afew tens of thousands of barrels per day, and usuallyinvolving simple equipment for processing oil only, sinceany unwanted gas produced with the oil was normally dis-posed of at the production site by 'flaring'. In these devel-opments, extensive use was made of 'off-the-shelfpackages of drilling and production equipment of the typeconventionally employed in onshore oilfields. Offshore,this equipment was mounted in the open on simple, flat,platform decks. The resulting platform weights fell mostlyin a range up to 3500 tonnes for the steel-piled structuresand 2000 tonnes for the decks and production equipment.

The next major phase of offshore development involvedNorth Sea oil and gas, and provided the oil companieswith a far more difficult task than anything which they hadpreviously encountered. The environmental conditionswere much worse, water depths much greater, wave heightsand resulting wave forces on structures substantiallylarger, and weather conditions generally hostile. In addi-tion, the new fields were further from land than any pre-vious offshore developments.

Serious interest in the North Sea as a source of hydro-carbons was first aroused by the discovery of gas fields inthe relatively shallow waters of the southern area duringthe middle 1960s. A number of fields in the UK sector,some 25 to 70 miles off the Norfolk/Lincolnshire coast,with local water depths of up to 30 m and maximum waveheights close to 17 m, were quickly developed using pre-fabricated steel platforms and process technology based

IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984 397

Page 2: Role of the consultant in offshore oil industry projects

largely on earlier projects in the Gulf of Mexico. Subse-quently, discovery of the Ekofisk field in the Norwegiansector in 1969, and the Forties field in the UK sector in1970, led to an intensification of the exploration effort inthe northern North Sea and its development as one of theworld's major oil-producing areas, effectively establishing anew West European offshore oil and gas supply industry.An example of a typical North Sea production platform,the Shell/Esso Brent A platform, is shown in Fig. 1, and amodel of an Arabian Gulf production platform for Aramcois shown in Fig. 2. Recently the rate of oil production from

Fig. 1 Shell/Esso Brent A production platformMain production facilities: consulting engineers, Ewbank & Partners Ltd.; structur-al subconsultants (modules), Sir William Halcrow & Partners

Fig. 2 Model of production platform for AramcoConsultancy services in detailed engineering design were provided by Halcrow-Ewbank Petroleum & Offshore Engineering Company

the UK sector has approached 2.5 million barrels per day,considerably in excess of total UK oil consumption, andnew developments are being pursued in both the southernand northern areas. Further major oil and gas field devel-opments have taken place and are continuing in otherareas of the North Sea, notably in the Norwegian sectorand, on a smaller scale, in the Netherlands and Danishsectors.

The North Sea developments have been made possibleas a result of a programme of technical development a id

398

innovation on an unprecedented scale by the offshoreindustry, to meet the challenge of working in deeper watersand extremely adverse environmental conditions, a com-bination of conditions which demands much larger plat-form structures and elaborate enclosures to protectequipment and operators. Fixed platforms have now beendesigned and installed in the North Sea in water depths ofup to 186 m, in locations where maximum wave heightsare in the range 29-34 m, and in even deeper waters inother parts of the world, where, however, theenvironmental conditions are generally less severe. Peakoil production rates for the larger individual platforms aregenerally in the region of 150000 barrels per day, althoughsome facilities designed for rather higher productioncapacities have been installed.

In considering developments of this magnitude andnature it is important to recognise that each project isunique, depending on its own individual field character-istics. Each has its own method and scale of production,platform design, processing requirements and transporta-tion system, and as a result a much higher proportion ofthe equipment is now custom-built rather than 'off-the-shelf.

The topside facilities of a typical major oil productionplatform consist of a self-contained unit of primary pro-cessing equipment which, since the platform normally hasto be essentially self-sufficient for long periods of time, isprovided with the necessary supporting utility systems,crew accommodation, helicopter landing deck and com-munications systems. Equipment for drilling the pro-duction wells is frequently also a part of the platformtopsides, as the drilling of additional wells may continuefor some time after the commencement of production. Theprocessing equipment, which is normally arranged in twoor more parallel trains to ensure continuity of productioneven during failure or maintenance of a part of the system,is designed primarily to separate the oil from associatedgas, and also to remove water produced with the oil. Theprocess facilities further treat the oil to render it suitablefor transportation to shore, either by pipeline or by tanker,as appropriate, and to clean the produced water so that itis of an acceptable quality either to be reinjected into theoil reservoir or disposed of directly into the sea. Since thedisposal of associated gas by flaring is normally no longeracceptable, except in emergencies, process facilities are alsoprovided to treat and compress the produced gas which isin excess of the platform fuel requirements, so that it mayeither be reinjected into the oil reservoir or transported toshore through a pipeline.

The associated utility systems which must be availablefor maintaining the satisfactory operation of the processfacilities and the drilling operations, as well as the platformlife-support systems, include fuel gas for prime movers;electrical power generation and distribution (which canhave a system capacity of up to almost 50 MW for a largeplatform); various types of heating systems for process andspace-heating duties based on waste heat recovery, electri-cal or direct-fired heaters; and water systems for treatingsea water, either to render it suitable for use as coolingwater or for injection into the oil reservoir, and to desali-nate it for domestic and drinking purposes. Other utilitysystems may include those for which materials have to beregularly transported from shore by supply boat or heli-copter, including special treating chemicals for the process,well-drilling fluids and helicopter fuel. Provision of thesefacilities with other process-associated systems such asemergency gas flares, and with living accommodation forup to about 200 personnel, has resulted in the topside

IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984

Page 3: Role of the consultant in offshore oil industry projects

facilities for some of the largest platforms having weightsclose to 30 000 tonnes.

2 Form of project development

Following the identification, by means of geophysical andgeological investigations, of an underground geologicalstructure favourable to the accumulation of hydrocarbons,and of a size which is likely to be commercial to produce, anumber of exploratory wells are drilled to confirm the geo-logical data previously gathered and the extent and natureof any hydrocarbons present in the reservoir. Once provedcommercial, development of the field commences with thedrilling of additional appraisal wells to identify andconfirm the reservoir boundaries and the temperature,pressure, composition and potential production rates ofthe hydrocarbons which the reservoir contains. Avail-ability of these data permits definition of the number andlocation of the production wells which are to be drilled,the type and capacity of the processing equipmentrequired, and the possible need to inject water or to rein-ject into the reservoir any gas which is produced with theoil, to boost or to maintain product flow rates. This leadsin turn to the determination of the number and location ofproduction platforms required, and in the case of oil pro-duction, depending upon production capacity and distancefrom land, the choice of delivering the oil to shore bysubsea pipeline or by tanker, the latter requiring the provi-sion of additional offshore storage capacity and offshoreloading facilities.

The conventional development of a large field mayrequire a number of production platforms suitably spacedabove the field, each accommodating the wellheads for upto fifty wells, many of which will be production wellsdrilled at angles from their respective platforms, in order todrain as uniformly as possible an allocated area of thereservoir.

Early North Sea oil developments, drawing on experi-ence gained in the Gulf of Mexico and the southern NorthSea, used prefabricated tubular-frame steel platform struc-tures or 'jackets', supported on steel piles driven into thesea-bed. A steel superstructure or 'deck mounted on top ofthe jacket accommodates the process plant required totreat the product, facilities for drilling the wells, living-quarters accommodation for personnel working on theplatform and the associated utility, life-support and com-munications systems, the whole assembly commonly beingreferred to as the platform 'topsides'. These facilities areusually prefabricated and assembled onshore into individ-ual steel structures or modules, which can weigh anythingfrom a few hundred tonnes to over 2000 tonnes.

During installation, the jacket is floated to the selectedsite on its side, using either built-in buoyancy of the struc-ture itself or temporarily attached buoyancy tanks, orsometimes supported on a special barge. Once on location,the structure is upended and lowered to the sea bed, andthe piles are driven to secure it in place. The deck structureand the steel-framed modules containing the productionequipment and associated facilities are then transported tothe site on barges, and lifted into place on the jacket usingderrick barges or crane ships. Once installed, the variousproduction and utility systems contained within individualmodules are interconnected to form the complete pro-duction facility, a phase of installation generally referred toas 'offshore hookup'. Pipelines to export products from theplatform are normally fabricated and installed in parallelwith the platform fabrication and installation.

Onshore fabrication of the platform jacket, deck and

modules typically occupies some twelve to twenty months,and offshore installation and hookup a similar period,although offshore installation work tends to be concen-trated in the summer months when there is greater cer-tainty of reasonable working conditions. This period,known as the 'weather window', has an important influ-ence on the scheduling of offshore developments, and inthe North Sea, even during the weather-window period,the sea state and weather conditions may rapidly changeto adversely affect offshore working conditions.

Owing to the inherent difficulties and high cost of off-shore installation work, and recognising the need for largebuffer storage facilities offshore to accommodate tankerdelivery systems, a new form of platform, the 'concretegravity structure', was introduced into North Sea develop-ment as an alternative to the piled steel jacket structure.Gravity structures, which may be several hundred thou-sand tonnes in weight, are designed to be floated to thefield in the vertical position, utilising the inbuilt buoyancyresulting from the large oil storage volume normally pro-vided in the base of the structure. Once on location, thegravity structure is ballasted down to rest in place on thesea-bed as a result of its own large mass.

One of the major advantages of this type of structureresults from the excess buoyancy which is available tosupport a substantial additional load, making it possible toinstall and hook up the deck and production facilitiesmodules while the structure is floating in sheltered watersclose to shore, before being towed to the installation site.The total period required for the construction and install-ation of a concrete gravity platform is similar to that for apiled steel platform, although in the case of the gravitystructure the costs of offshore hookup may be substantiallyreduced by the ability to perform the work under muchmore favourable conditions. The choice between the twotypes of platform depends largely on evaluation of thefunctional requirements of the platform, the sea-bed condi-tions and the overall project costs and schedule.

An alternative scheme for production from offshorefields utilises what is known as the subsea completionsystem, in which the wells are terminated at wellheadslocated on the sea-bed. Such systems could ultimatelypermit gathering and processing of oil and gas entirelybeneath the sea surface, but the present state of develop-ment requires the delivery of oil and gas to a processingfacility above the surface. A number of individual subseacompletions have been installed on fields with convention-al fixed platforms, to reach areas of the reservoir not acces-sible to wells drilled from the platform alone. They delivertheir production through subsea pipelines to the platform-mounted processing facilities. Other recent developmentshave interconnected a number of subsea completions onthe sea-bed, through complex underwater manifold centresdesigned to be maintained by robots. The combinedproduct flow of the wells involved is then directed either totreatment facilities mounted on a fixed platform, orthrough a flexible piping riser system to facilities mountedon board ship or some type of alternative deepwater struc-ture or floating platform.

Alternative types of platform, including guyed towersand tension leg platforms, which could be used in conjunc-tion with subsea completions, are now at an advancedstage of development. The guyed tower consists of a con-tinuous, flexible, steel structure secured to the sea-bed andextending vertically to support a deck and processingfacilities above sea-level. The structure is held in place bycables anchored to the sea-bed in a manner similar to thatin which guy ropes are used to support a vertical mast. In

IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984 399

Page 4: Role of the consultant in offshore oil industry projects

the tension leg system, the platform is a floating structure,similar in configuration to a large semisubmersible drillingrig, which is held in position by vertical cables anchored tothe sea-bed and maintained in tension by the buoyancyforces on the structure. The tension leg platform representsone of the most important forms of development which areexpected to be widely used in water depths where conven-tional fixed platforms are no longer feasible or economic,that is, in water depths in the region of 350 m and deeper.To gain an understanding of the scale of recent North Seadevelopment, where some of the world's largest platformshave been installed, it is interesting to consider some sta-tistics for specific platforms.

Chevron's Ninian field central platform, which wasinstalled in 1978, is the largest of three platforms installedon the field. In addition to supporting its own wells andproduction facilities, the platform acts as a gatheringcentre for production from the other platforms. Peak pro-duction from the field has been reported as being in theregion of 300 000 barrels per day, of which the central plat-form produces roughly half. The reported weight of theplatform's concrete gravity structure is approximately396 000 tonnes, and the combined weight of the steel deckand modules over 45 000 tonnes.

BP's Magnus platform, the world's heaviest single-piecesteel platform, was installed during 1983 in the deepest andmost hostile area of the North Sea yet to be developed.Located in a water depth of 186 m, the platform's expectedpeak production is 120000 barrels per day of oil, 9000barrels per day of natural gas liquids and 1.98 millioncubic metres per day of gas. Reported weight of the steeljacket is 35 400 tonnes, and the topsides weight is 31000tonnes. The total development cost, including wells andpipelines but excluding the cost of removal at the end of itsuseful life, has been reported as £1370 million, of whichapproximately 56% represents the cost of the platform,making it probably the most expensive offshore projectyet, in terms of its £10620 installed cost per daily barrel ofpeak oil production.

Exploration for hydrocarbon reserves normally com-mences with the granting of licences by the Government ofthe host country for exploration of specific geographicalareas. Following the discovery of a commercial field, alicence may be issued for a specific development. Licencesare held by individual oil companies or, where the size ofthe potential investment is very large and the degree of riskhigh, as for example might be expected in the North Sea,by a consortium of oil and nonoil industry organisations.A major oil company, often the principal shareholder ofthe consortium, usually undertakes responsibility as 'oper-ator' for developing the field on behalf of such a group.During the field development phase the operator, frequent-ly employing a managing agent, commissions consultantsand contractors to prepare designs and carry out the fabri-cation, installation and associated activities. Operators andcontractors may draw technical and management supportfrom many other organisations, including research &development organisations and consultants.

Industrial investment to fund exploration and develop-ment usually comes from the private sector. Many coun-tries now have their own national oil corporations whoparticipate in their domestic projects in a variety of ways,frequently in association with the major international oilcompanies, sometimes as operators in their own right. Inthe developing countries especially, this has led to increas-ing involvement in oil and gas projects by the internationalfunding organisations, with whom many of the larger con-sulting firms are registered.

3 The consultant and early offshore developments

In many of the initial offshore developments, especiallythose in the Gulf of Mexico and to a somewhat lesserextent the early projects in the North Sea, the oil industryemployed consulting firms to carry out feasibility studiesand prepare preliminary and sometimes detailed designsfor the platforms and production facilities. The consul-tancies involved tended to be multidisciplinary, staffed andequipped to provide process and project engineering,mechanical, electrical, instrumentation and control engi-neering, and civil, structural and architectural design as anintegrated service, co-ordinated by strong managementteams. The majority of these firms were American-ownedand able to draw on a long and impressive history of expe-rience, particularly in United States domestic oil pro-duction projects. Their major role, after completing theinitial feasibility studies, was to prepare tender packageson behalf of their oil company clients for the engagementof contractors who undertook the completion of thedetailed design, procurement and construction phases ofthe projects. In addition to defining workscope and theform of contract, these tender packages incorporated engi-neering designs which frequently were as complete as pos-sible at that stage, lacking only the detailed definition ofthe equipment items which were to be requisitioned andpurchased by the contractor. Other services provided bythe consultant included inspection and technical and man-agement assistance to the client during detailed design,construction and commissioning. A number of specialistconsultancies were also active during this period, provid-ing services in a number of areas including geological andgeophysical survey analysis, petroleum economic studies,petroleum reservoir evaluation and structural engineeringdesign and analysis.

The very rapid pace of development in the northernNorth Sea, with a number of projects of unprecedentedsize and complexity being undertaken simultaneously,marked something of a change in the manner in which theoffshore industry conducted its projects, with a trend foroil companies to contract out management responsibility,conforming with their earlier practice of letting turnkeycontracts for major refinery works. For many offshore pro-jects, the oil companies themselves then defined the basicdevelopment concepts and design specifications, often uti-lising the assistance of consultants during this phase of theproject, but contracting out the engineering, from initialprocess design through to detailed engineering design andspecification, to the large engineering contracting firms.Overall project management, planning and control wasundertaken either by a managing agent appointed by theoperator, often also an engineering contractor and some-times the same organisation as that responsible for theengineering design, or by the operator's own organisation,sometimes utilising the services of consultants.

The prime objective of project management during thisphase of the offshore industry's development, which tookplace against a background of rapid expansion of thewestern economies, rapidly rising oil consumption and theoil companies' need for additional secure sources of supply,was to ensure production of oil and gas on the scheduleddate. Consequently, project planning and control systemswere oriented to maintain the project programme ratherthan to impose strict cost control, which was generallyregarded as being of lesser importance. Owing to the rapidprogrammes set, the high development content of the pro-jects and a variety of other factors, which have beenreported in some detail elsewhere [1], actual development

400 IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984

Page 5: Role of the consultant in offshore oil industry projects

costs for the early North Sea oilfields showed a very highdegree of escalation over the initial cost estimates, butwere nevertheless similar in magnitude to the escalationthen being experienced with other industrial projectshaving a large development content.

The rapid rise in oil prices in the few years followingOctober 1973 eventually resulted in a substantial fall indemand due to worldwide industrial recession and theintroduction of energy conservation programmes. Duringthe same period, the estimated costs of future offshore fielddevelopments in most oil-producing areas of the worldincreased considerably, as the oil companies made allow-ance for the factors which had caused cost escalation inearlier offshore projects, as high rates of inflation resultedin large increases in the costs of materials and services, andas governments imposed increasing taxation on oilrevenues. Furthermore, many of the known fields remain-ing to be exploited were by now either smaller fields situ-ated in regions where other, larger, developments hadalready taken place or were in deeper, more hostile watersthan before, and when assessed in terms of the existingconventional development methods were often found to beeither uneconomic or only economically marginal.

This led to a substantial reduction in the rate of offshoredevelopment during the late 1970s, and prompted changesin oil company project procedures, designed to containand even reduce future development costs. In addition,numerous studies were initiated within the industry, inwhich consultants were widely engaged to investigate areasfor potential cost reductions in future projects.

Current field-development schedules generally allowmuch more time for developing the design concept thanwas the case in early offshore projects, and operators nowplace greater emphasis on the need for developing com-plete design data and comprehensive feasibility studies,leading to a well-defined design concept and project-planning basis before commencing detailed design. Regula-tory bodies also require more detailed information definingthe nature of proposed developments, assessing potentialhazards and environmental impact. Consequently, theearly stages of project definition now offer both specialistconsultants and multidisciplinary consulting firmsincreased opportunities to provide their services.

4 Specialist services

4.1 Increasing degree of sped a lisa tionThe primary function of the consultant is to provideadvice, the value of which depends upon its having a quali-tative advantage over that available from other sources.To maintain such an advantage, the consultant mustpossess an unrivalled knowledge of current and developingtechnology and the best available industrial practices in hisfield, which tends to lead to a high degree of specialisation.

Currently, even the major international companiesinvolved in offshore developments do not employ per-manent staff to serve all their engineering requirements,and there is a trend among both oil companies and con-tractors to rely more on the employment of consultants forspecialist services. This is largely the province of the small,highly specialised consulting firm or private consultant,but it also presents opportunities for consultants from gov-ernment laboratories, research establishments and the uni-versities. Probably one of the best known and traditionalexamples of specialist consultants in the oil industry is theuse of geophysical, reservoir and petroleum engineeringconsultants to assist in the evaluation of exploration data,assessment of the nature and extent of hydrocarbon

reserves and the development of drilling and productionprogrammes. Specialist services may also involve any ofthe major engineering, scientific or management disci-plines, either individually or in combination, and someexamples of the major areas of consultancy concernedoccur in environmental, hazard and other safety studies,certification, quality assurance, marine structural engi-neering, process and petroleum engineering and telecom-munications.

4.2 Environmental, hazard and safety studiesOne of the most important roles fulfilled by the specialistconsultant is in work on the environmental, loss-prevention and risk-assessment aspects of a project. Themost valuable work in this area is normally done at theplanning stage, when the consultant can assist in guidingthe development of the early project concepts to conformwith existing, and sometimes anticipated future, anti-pollution and safety legislation. In this field in particular,opportunities exist for smaller consultancies to developtheir own expertise and to practise in very specialised areasof interest to the oil industry, for example in studies of thedispersion of gas clouds, ventilation of enclosed spacescontaining production equipment, and assessment of therisks of explosion or toxic hazard.

Recently there has been increasing industrial interest inhazard analysis and operability studies, applied to allaspects of oil and gas production facilities. These studiesare normally initiated early in the engineering develop-ment of a project, when preliminary flowsheets, equipmentlayouts and specifications first become available. The com-plexity and density of equipment in offshore productionfacilities creates 3-dimensional hazardous-area arrange-ments of a very involved nature, requiring rigorous evalu-ation, and the classification of areas for electricalinstallations necessitates detailed study of the processingsystems and the materials which they handle.

Safety studies generally form an essential aspect of allstages of an offshore development, and may extend intothe operating phase when, for example, there may be aneed for a reassessment in the light of changing industrialpractices or new legislation. In the past, this has resulted ina number of consultant-led surveys and audits ofhazardous-area classification, ventilation and fire andsafety systems on offshore platforms. Consultants special-ising in the area of hazard and other safety studies mayalso find themselves called upon, when there is a plantfailure or accident, to assist in the investigation of possiblecauses, and subsequently give evidence at any officialinquiry which may result.

4.3 CertificationIn 1974 the Department of Energy introduced the require-ment that all structures in UK waters should be certifiedas fit for use, as evidenced by the possession of a valid'certificate of fitness' issued by a certifying authority.Certain minimum requirements governing the safety andfitness of offshore installations were defined in the OffshoreMineral Workings Act [2] and related enforcing legisla-tion. The implementation of this legislation established amodel of statutory regulation which has been adopted inprinciple by other nations developing offshore hydrocar-bon reserves.

Certification effectively covers the complete history ofan offshore project. It commences with the detailed designconcepts prepared following receipt of Department ofEnergy approval to proceed with the development,approval which is itself based on the Department's detailed

IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984 401

Page 6: Role of the consultant in offshore oil industry projects

review of the initial feasibility studies and design concepts.Every aspect of the development, from sea-bed surveysthrough the detailed design drawings, specifications andcalculations to final construction is subject to this indepen-dent audit. Materials and equipment must be certified assuitable for offshore use, and the fabrication of platformcomponents, jackets and modules is subject to the scrutinyof a certifying authority surveyor. No offshore installationis issued with a full 'certificate of fitness' until an 'as-built'survey is completed satisfactorily. Since the Health andSafety at Work Act [3] was extended to cover all activitieson the UK continental shelf, certification has also includedthe review of potential health hazards such as high noiselevels in the working areas of offshore installations.

To ensure compliance with the regulations, the Depart-ment of Energy has authorised six organisations to under-take the necessary inspection and monitoring of designstandards and fabrication techniques and to issue certifi-cates of fitness, working to guidelines published by theDepartment [4].

The appointed authorities are the American Bureau ofShipping, Bureau Veritas, Det Norske Veritas, German-ischer Lloyd, Lloyds Register of Shipping and the OffshoreCertification Bureau, the last named being a multidisci-plinary association of British consulting firms. For a parti-cular project a certifying authority is nominated from thislist by the operator, who bears the complete cost of thecertification work.

The Department's published guidelines for certification,which are stated in necessarily broad terms, are open to aconsiderable degree of detailed interpretation, and furtherguidance in some areas concerned has been published [5].A high level of co-ordination is required between thevarious organisations responsible for the development ofan offshore project, to ensure the efficient integration ofthe certification activities and to programme the avail-ability of required design data and documentation, inspec-tion and material certificates for audit in a manner whichwill not delay the overall project schedule. This has led tothe introduction of the function of 'certification engineer'in many offshore projects, and a number of consultantshave developed appropriate systems and procedures andprovide expertise in this field.

4.4 Quality assuranceFrom its earliest days the offshore industry, in commonwith other branches of the construction industry, has rec-ognised the importance of quality control and, only toowell aware of the arduous service conditions and poten-tially disastrous and costly consequences of material orequipment failure offshore, has rigorously applied qualitycontrol to the manufacturing, fabrication and installationphases of its projects, employing consulting firms forinspection services and interpretation of inspection data.Engineering designs and procedures for fabrication andinstallation are usually checked internally by the servicecompanies responsible for their preparation, in many caseswith consultants retained by the operator to undertakeindependent design audits, and these areas became subjectto statutory audit following the introduction of certifica-tion.

The combined application of quality-control proceduresand engineering audits alone does not, however, guaranteefrom the outset the consistent achievement of the specifiedquality of facilities when built, or the efficient, on-time andwithin-budget, performance of the project. Recognising thepotential benefits which quality assurance systems couldbring to these areas, as demonstrated by previous suc-

cessful experience in the nuclear and aerospace industrieswhere the concept was first developed, the offshoreindustry has recently begun to introduce quality assuranceinto its activities, with oil companies, contractors andmanufacturers making extensive use of consultants todevelop the systems and procedures and assist in monitor-ing their application.

4.5 Structural engineeringIn many offshore projects, because of their size, complexityand the special expertise involved, the platform structureand topsides are made the subject of separate contracts forthe design and fabrication stages, the junction betweenstructure and facilities representing a relatively convenientinterface to define. From the earliest application of fixedsteel platforms, structural consultants have provided theoperating companies with civil and structural engineeringservices in the survey and evaluation of sea-bed conditionsand subsea foundations, preparation of pile drivabilitystudies and design of fixed steel structures and pilingsystems; and have undertaken preparation of bid pack-ages, carried out bid evaluations and provided assistanceduring fabrication and installation of structures. Otherstructural services now include detailed analysis anddesign audits for all types of marine structures, includingmobile facilities such as jackup drilling rigs, to prove theintegrity of the structures during the various stages of fab-rication, lifting, load-out, sea transport, launching, install-ation and service under design load conditions. Structuralconsultants also provide design and analysis services totopsides engineering companies for the platform structuralcomponents including decks, modules, living accommoda-tion, flares and cranes.

Consultants have played a major role in evolving moreefficient and cost-effective designs for conventional steelplatforms, and in developing new types of platform such asgravity structures in steel and concrete, tension leg plat-forms and other types of deepwater and wholly underwaterstructures, for which they may also provide a completerange of design services and advice to operators on selec-tion of types of structure for specific applications. Otherstructural services include detailed analysis of existing steelplatforms using comprehensive computer models of thestructures, updated by incorporation of performance dataobtained from structural inspection and monitoring prog-rammes. This may be employed in feasibility studies foramended platform loading, analysis and design of modifi-cations, detailed fatigue analysis and the design of repairsto damaged or fatigued structures.

4.6 TelecommunicationsProduction facilities offshore are highly complex systemswith elaborate requirements for communication, controland shutdown in emergencies. Many offshore facilitiestransmit their products through pipelines to the shorewhere treating plants are located which further process theoil and gas. For economic reasons, it is not uncommon fora number of platforms with different operators, producingproducts of different physical characteristics, to utilise acommon pipeline. The interconnection of different pro-duction systems in this way provides added complexity incontrol of the individual platforms and their interactionwith the control of the pipeline and onshore treating plant,and calls for additional offshore measurement and onshoremonitoring of the flow and quality of the different prod-ucts for control, accounting and tax purposes. Consider-ations such as these, combined with platform-manningrequirements and the local movement of helicopters, work-

402 IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984

Page 7: Role of the consultant in offshore oil industry projects

boats and supply vessels, provide a need for com-prehensive telecommunications and telecontrol systems.

On the platform, it is normally necessary to providecommunications including telephone, radio-paging andpublic-address systems, closed-circuit television sur-veillance and emergency telephone and alarm systems.Mobile radio systems are also provided, as well as marineand ground-to-air communications and aids to navigation.Systems are required for data acquisition, data transmis-sion on and off the platform and control, frequently incor-porating various systems of computer control andsimulation, with communications by such means asoptical-fibre cable, power-line carrier systems, troposcatterand line-of-sight microwave and radio-frequency systems.

In many projects, the study, planning and specificationof these systems, together with the preparation of tenderpackages, tender evaluation, assistance with licences andprovision of contract and management services, are under-taken by specialist consultants.

4.7 Other activitiesNumerous other fields of activity associated with the off-shore industry are served by specialist consultants, amongwhich may be mentioned drilling facilities; heating, venti-lation and air-conditioning; fire protection; acoustics andnoise control; vibration analysis; metallurgy; corrosionprevention and various inspection services. Computer con-sultants provide services in systems analysis, system designand software generation related to diverse aspects of off-shore developments. In many of the areas served, technicaland management training may form an important serviceprovided by the consultant which, when advising clients indeveloping countries, represents an important contributionto technology transfer.

With the exception of certification services and possiblyconsulting services related to platform structures, both ofwhich are normally the subject of contracts entered intodirectly with the operator, specialist consultants may beretained to work on behalf of the operator or his agentsand contractors. Many of the types of work previouslymentioned can be, and in many cases are, carried out byindividual consultants or small, specialised consultingfirms. Many also come within the scope of services offeredby the larger consulting firms, whose main role, neverthe-less, may occur in engineering and project management.

5 Engineering and management

A traditional field of activity of consulting engineers, parti-cularly in the disciplines of civil, mechanical and electricalengineering, has been the overall design of major projectsand the provision of project management services. Thisgenerally has not been the case, however, in the processindustries, where the majority of modern processes, such asthose used in oil refining and the production of petro-chemicals, are owned and licensed by the companiesresponsible for their development. These firms normallyprovide the process design, including certain aspects ofdetailed design, construction advice and commissioningassistance which are considered critical in relation to guar-antees of plant performance, as part of the licensingarrangement.

Virtually all of the basic process technology employedin the production of oil and gas exists in the publicdomain, providing opportunities for the consultant todevelop independently the capability to do work in thisfield. Process engineering, with specialisation in the pet-roleum engineering aspects, is the fundamental discipline

involved, and the process or petroleum engineer plays akey role in all phases of project development. Consultingfirms possessing this capability are therefore enabled toundertake not only process engineering as a specialistservice but also, through the employment of multidisci-plinary engineering teams, a broad range of activities inproject development including prefeasibility studies, feasi-bility studies, conceptual design, specification and detaileddesign, tender preparation and analysis, contract engineer-ing and project management and commissioning services.Other services provided may include audit of third-partydesigns and assistance in the preparation of standards andcodes of practice.

Much of the offshore project work in these areas isundertaken directly for the operators, and often requiresthe deployment of a large manpower resource. Thedetailed engineering for a major North Sea platform top-sides, for example, can consume well in excess of half amillion manhours of engineering and draughting during atypical 15 month design phase, and much of this type ofwork requires even the largest consulting firms to formassociations or joint ventures with others for individualprojects, to employ subconsultants and to engage tempo-rary staff. To facilitate co-ordination and control, espe-cially of the larger projects, the industry tends to favourthe use of dedicated teams of project personnel locatedtogether in a 'task-force' operation. It is in this type ofactivity that the work of the larger consulting firms issimilar to that normally undertaken by the contractors,with detailed engineering design and project managementproving to be areas of real competition.

The earliest engineering phase of an offshore projectnormally occurs in what is commonly known as the fielddevelopment study. This is essentially a technical feasibilitystudy and economic evaluation of possible developmentschemes for a completely new oil or gas field, the startingpoint for which is the initially available reservoir data andinformation obtained from exploration wells. The studynormally proceeds to determine the number and locationof wells required, the type and capacity of production andassociated facilities to be employed and the method oftransporting products from the field. The final stages of thestudy involve the preparation of capital-cost estimates andcash-flow analyses for the overall development.

Other, more detailed, feasibility studies generally followas the development proceeds, concerned with specificaspects such as the production facilities on individual plat-forms, leading to development of the conceptual or pre-liminary design. The resources, range of expertise andaccess to current cost data which are necessary for the suc-cessful execution of these types of study, place the worksubstantially within the scope of the larger multidisci-plinary firms, who have up-to-date experience in the engi-neering and management of offshore projects. Thefeasibility study, in particular, gives the consultant theopportunity to perform in his traditional role of providingexpert advice in a completely objective and unbiasedmanner.

As the offshore industry's projects have become largerand more complex, operators have increasingly made useof outside firms to perform the overall project manage-ment function, generally described as the 'project manager'or 'managing agent/contractor', or to provide to theproject manager some or all of the supporting project ser-vices, acting in a role described as 'project services contrac-tor'. Consultants experienced in large engineering projectsnormally possess the project management personnel andmanagement systems required, and frequently undertake

IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984 403

Page 8: Role of the consultant in offshore oil industry projects

this type of work, providing overall management, planningand scheduling, estimating and cost control, weightcontrol, purchasing and inspection services, and areemployed in monitoring the performance of contractorsduring construction and installation. In the later stages ofproject development the consultant's activities may includethe preparation of operating and maintenance manualsand provision of assistance, including operator training,during the plant commissioning and operation.

Consultants experienced in the full range of engineeringand management activities may also provide engineeringservices in support of production operations. This type ofwork is concerned with the operation, maintenance, modi-fication and expansion of production facilities which arealready on-stream, and requires a detailed knowledge ofthe procedures and constraints applying to offshore oper-ations. Normally administered as individual projects, oftenquite small and with compressed schedules determined byaccess to platforms and timing of maintenance shutdowns,the work includes performance testing, 'as-built' surveys,studies and design, and the management of related con-struction activities.

6 The future

Some recent oil industry predictions have indicated thatfuture oil discoveries are likely to add to the world'shydrocarbon resources in roughly equal proportions infields on land, in offshore fields in water depths up toabout 200 m, and in deep-water fields beyond this depth.Until now, fixed platforms have generally provided themeans of producing oil and gas from relatively accessiblefields in the lower range of water depths. Existing tech-nology, based mainly on the use of platform-supportedwells and production facilities in association with subseawell completions, can provide access to reserves in waterdepths up to 350 m in most areas of the world, exceptingonly those with the most extreme environmental condi-tions.

In the immediate future, a large proportion of new fielddevelopments will involve small fields in moderate waterdepths. By current standards, many of these are consideredto be only marginally economic to produce, and successfulexploitation will depend upon the ability of the offshoreindustry to achieve substantial savings in developmentcosts. In the North Sea, for example, tax changes recentlyintroduced by the UK government have encouraged reass-essment of a number of marginal field discoveries, all ofwhich will need to be developed if the UK is to remainclose to self-sufficiency in oil, but in many cases furtherreductions in development and operating costs arerequired to render the fields commercial.

A number of areas offering potential for cost savings arecurrently under invesigation throughout the industry,including schemes for simplifying existing, operationallyproven, types of production facilities and the introductionof a wide range of technical innovations affectingequipment and structures. Other promising areas forachieving cost savings include the adoption of proceduresto improve feedback of information into the design stageof projects, to ensure that the detailed requirements of fab-rication, operation and maintenance are incorporated; andreview of project-management organisations and forms ofcontract with the aim of attaining more efficient, faster andcheaper project completion. A comprehensive review of themany areas of offshore projects amenable to cost reductionindicates that overall savings in the region of 15-30% ofproject costs may eventually be achieved.

Examination of the cash-flow projections for variousfield developments reveals that very significant improve-ments can be made by taking advantage of the early oilrevenues which may be obtained by reducing the timebetween project inception and the start of oil production.The effect of this can outweigh even fairly substantialincreases in capital costs, and is likely to result in increaseduse of systems designed more specifically for early pro-duction, which in some cases may involve greater capitalexpenditure than more conventional production facilities.One such system makes use of a special steel templateinstalled on the seabed, through which the wells are drilledduring the period when the platform is being designed andfabricated, and upon which the completed platform is sub-sequently installed. Other early production systems involvethe use of temporary and floating production facilities incombination with subsea well completions.

For very deep waters, beyond the range of applicationof fixed platforms, tension leg platforms with wellheadssupported on the platform and floating production facili-ties with subsea well completions are generally consideredto be the most feasible production systems, having a highcontent of existing technology. Floating productionsystems are almost certain to provide the least expensivemethod of producing deep-water fields in the near future,and conversion of existing surplus tankers and semi-submersible drilling rigs for this service is likely to offer thecheapest route to early oil production. The more expensivetension leg platform, which will allow production in waterdepths of 600 m and beyond, may possibly be utilised onlyby the major oil companies when developing larger fieldsof great depths and in environmentally hostile areas.

The use of permanent underwater systems, with all theproduction equipment installed in enclosures on theseabed, either remotely controlled or manually operatedby personnel working and living beneath the sea in a dry,atmospheric pressure, environment presents considerabletechnical problems, especially with regard to maintenanceand servicing, and consequently remains far in the future.Complete underwater systems, fully independent of surfaceproduction installations, may, alternatively, enter service inthe form of remotely controlled production and pumpingstations, capable of delivering the full, untreated, well pro-duction through long-distance underwater pipelines toland-based processing plants.

A feature common to all deep-water systems, and animportant component of many current developments inshallower waters, is the use of subsea well completions.Well servicing and repair is far more expensive and com-plicated for subsea wells, and a high level of safety andreliability with minimum maintenance, important charac-teristics in any production system, become even moreimportant for underwater systems. The use of divers is inany case a costly operation and becomes physically impos-sible at the greatest water depths now being considered,requiring the use of robots and manned and unmannedsubmarine vehicles for inspection, maintenance and repairactivities, and for providing personnel access to under-water facilities.

All of the systems previously described are the subjectsof various offshore industry research and developmentprogrammes, in which consultants are providing a broadrange of services, and some of the systems, or major systemcomponents, are either at an advanced stage of develop-ment or are already in production service offshore. Thereis now, for example, fairly extensive industrial experienceof the operation of subsea well completions in moderatewater depths, an application in which the system is gener-

404 IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984

Page 9: Role of the consultant in offshore oil industry projects

ally considered to have moved out of the innovation stage.Shell/Esso have recently installed a remote underwater-manifold production centre, and Conoco are due to installthe first full-scale tension leg platform later this year. Bothof these facilities are in the North Sea, in water depthswhere a conventional fixed platform development wouldprobably have been simpler and cheaper, but are designedto gain experience for future deep-water application.

A large proportion of the industry's research and devel-opment is funded by the oil companies, equipment manu-facturers and other industrial organisations. Funding forappropriate projects may also be available from govern-ment sources, international funding agencies and, inEurope, from the EEC.

The growing complexity and international nature of oilindustry operations should provide increased opportunitiesfor consultants to offer services in their established areas ofspecialisation, and to develop and expand their expertise,through participation in research and development activ-

ities, into new fields which are of interest to the oilindustry. In addition to being able to act directly for andin the best interests of the client, providing objective adviceand services of a high quality, the consultant will find itincreasingly necessary to demonstrate a high degree ofmobility, with the capability to provide services to clientslocal to new project developments throughout the world, ifhe is to maintain and enhance his role in the offshoreindustry.

7 References

1 North Sea Costs Escalation Study, Department of Energy, EnergyPaper 7, 1976

2 Mineral Workings (Offshore Installations) Act 19713 Health and Safety at Work etc. Act 19744 Offshore Installations (Construction and Survey) Regulations, SI 1974/

289, 19745 Certification Manual, Offshore Certification Bureau, 1981

IEE PROCEEDINGS, Vol. 131, Pt. A, No. 6, AUGUST 1984 405