THERE is no doubt that the past more than six months of tight oil prices has served to focus minds in the offshore industry. However Fugro-Rovtech’s managing director, Grant Aitchison, is cautiously optimistic about the future.
He says Fugro-Rovtech is in good shape. The breadth of services, both of the parent group and Fugro-Rovtech, is proving a wise investment.
Fugro-Rovtech’s own activities range across drilling support, IRM (inspection repair and maintenance), construction support, plus subsea engineering and related intervention.
“We’re having to adapt to different ways of doing business because of oil price-related pressures, but Fugro-Rovtech is well placed to cope,” says Aitchison.
“The underlying business is both solid and sustainable and we should be able to succeed in all but the worst of situations; but that would need the industry to be on its knees first, which clearly it is not.”
He points out that, of course, clients have been looking for cost savings from their contracts with Fugro-Rovtech, as with the supply chain in general, but that the company has, wherever possible, sought to achieve this through operational and technical improvements rather than simply reducing prices. His view is that the high quality of the workforce, technologies – not least a substantial 50-plus fleet of ROVs (remotely operated vehicles), plus their tooling spreads – and long-term stable relationships with clients are crucial, notwithstanding oil-price pressures.
“The key to successful IRM, for example, is to think in life-of-field management and maintenance terms, and we cover all aspects of this. That is a really important foundation of what we do,” says Aitchison.
He acknowledges that life is tougher, especially in the North Sea, where the OSV (offshore support vessel) spot market has all but disappeared this season, but says that Fugro’s construction support flagship, for example, Fugro Saltire, is well placed, with 150 days booked in Norwegian waters supporting Technip on several major projects involving dynamic riser replacement, hot-taps and general construction support tasks.
The 110m vessel, still less than a year old, spent the first 10 weeks of 2009 operating in the Falklands, carrying out geotechnical assessments, and she is proving to be an excellent and versatile work platform.
Fugro-Rovtech has four ships, the other three being Skandi Carla, Skandi Inspector and the Highland Eagle, which is on North Sea IRM work.
Skandi Carla, a purpose-designed and built ROV survey and construction support vessel delivered in 2001, has lately been working offshore India, supporting Allseas on the Reliance Industries-operated Dhirubhai gas development.
“This started out as being a two/three-month assignment, but was extended by a further 12 months. However, Skandi Carla is returning to north-west Europe for summer deployment on the Corrib development off the Irish west coast,” says Aitchison.
Despite current market uncertainties, Fugro’s fleet is well utilised through to the autumn and, with a healthy list of potential projects in the global developments pipeline, plus the absolute need to keep ageing provinces like the North Sea in good health, the underlying outlook is positive.
“We are, for example, currently bidding international work offshore West Africa and Mediterranean Africa,” says Aitchison.
“This includes Angola and Ghana; also Egypt, where Fugro recently successfully carried out in-situ ‘keyhole surgery’ repairs on a production manifold.
“We did a dry run in Aberdeen prior to performing the job offshore. This involved very complex engineering; the planning phase took months, while the task was accomplished in just three weeks working with a team of 12 offshore personnel and dual ROVs.”
A full-scale replica was built of the manifold roof and associated internal beams, flanges and pipework, including the elbow section that had to be replaced. This allowed all the required tooling to be tested prior to the actual offshore operation.
Like the above task, not all contracts require a Fugro ship.
Aitchison says: “We’ve started on what, for us, is a very important contract with a key deepwater operator in Nigeria, providing ROV intervention, related tooling and a wide range of other services from within the Fugro group.
“This is a multi-year contract with options. We’re not using our vessels in this instance, but it’s an important job.”
Meanwhile, subsea engineering is currently the fastest-growing business stream for the company.
Aitchison: “Having the vessels, ROVs and extensive tooling and engineering capabilities gives us a very strong hand. But this is not about taking work away from main contractors … it’s about making us more valuable to them.”
Indeed, the success of subsea engineering is real justification for the considerable investment that Fugro continues to make in Aberdeen, including a purpose-designed, in-build three-floor office complex at Murcar Industrial Estate, of which the subsea engineering department is being allocated about one-third of the 600sq m of new floor space.
The other two-thirds will be occupied by Fugro’s Wellservices division, plus there are yard, workshop and warehousing upgrades in progress – all due to complete in August this year.
Aitchison adds: “This should give us the additional space that we need to cope with expansion of the business over the next year to 18 months.
“This is all about investment in the future.”