Remote location is a key factor to be considered in the development of projects in deepwater frontier areas. This has been amply demonstrated in existing projects in locations like East Africa, some Pacific areas, and the Arctic. In all cases the supply chain network is not as extensive as in traditional operating areas. The local area network that exists will, in most cases, have to rely on the international network for its supply. As a result the base cost for project execution is relatively high due to cost of procurement and the expense of getting equipment, materials and people to the location. Certainly the reaction time of the supply chain will be longer. These conditions may mean moving all needed equipment and materials to the location at the beginning of the project. This will prove especially true when dealing with locations restricted to seasonal operations. The cost of unplanned events is very high because appropriate support may be a considerable number of days or even weeks away from the project site and cost a large amount of money to mobilize. Waiting times will always be longer than those in more traditional areas. Given the uncertainties of the supply chain, circumstances may prevent the arrival of the necessary material at all or not in any kind of timely fashion. In the Arctic, this can result in the entire operation being delayed or moved from one year to the next because of the limited duration of the working season.
…“getting it right the first time” is extremely important.
One very simple but extremely important lesson learned in previous operations in frontier areas is that “getting it right the first time” is extremely important. A mistake in a frontier area is likely to be far more expensive to correct than the same in mistake in an environment like the North Sea or the Gulf of Mexico.
Frontier projects will naturally demand significantly more planning, more review, more contingencies, more material, more spare parts and more time than projects closer to major infrastructure. Distances between manufacturing and warehousing locations and the project location not only have the potential to drive up project cost, but have the added potential to drive the project schedule to a point where existing logistics structures do not have sufficient availability, or to the point of multi-season operations. A deepwater operation may require a considerable fleet of vessels stationed on location for at least the initial stages of the project or at least during the working season in seasonal areas to be able to provide sufficient support for efficient and sustained operations. When considering the possibility of dealing with emergency situations such as blowouts or spills, clearly the response mechanisms must be on location because any delay in mobilization is unacceptable due to the environmental sensitivity.
Getting it right the first time, every time, drives an increasing demand for rigorous project management, logistics control and engineering. Simply moving people from around the globe to offshore deepwater work locations in frontier areas is a complex logistical challenge and is made more difficult by the need to co-ordinate movements of supplies and equipment. Such projects naturally consume relatively high volumes of man hours and demand a highly skilled group of personnel that can draw on previous experience related to operations in remote areas and extreme environments. It is important that a true understanding of the environment is embedded in the team that manages the project. Ideally, the team should be located as close as possible to the location where the work will be performed.
When considering all of these factors it is simple to conclude that logistics, security of supply and support may be the most critical factors in successful execution of such projects. The key question from the operating company to the service company in a frontier area will always be, “Will you actually deliver?”
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Deep Water Team Leader
Curtis Wendler has been in the oil and gas industry for 37 years, including 17 years in operational and management positions at various locations in the Middle East and North Sea. Following his operational career, he spent 12 years in technology development and global technical support. He was then seconded to Halliburton’s Deepwater Team and currently serves as the Deepwater and Complex Wells team leader in the Global Technical Solutions group. Curtis holds six patents related to well testing and has authored a number of professional papers related to well testing, heavy oil, high-pressure/high-temperature (HPHT) issues, Arctic operations and deepwater operations.
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