The CEO of Proserv has called for the oil and gas industry to make dynamic changes to the way it acts and behaves.
Speaking at Offshore Europe, David Lamont said the North Sea has many years of profitable life ahead if the sector urgently adopts more collaborative and efficient business practices.
â€œWe must embrace and rekindle the pioneering spirit that made the North Sea great in the past to ensure the North Sea industry doesnâ€™t fade out prematurely, but really flourishes in its latter years,â€ he said.
â€œDespite talk in recent years of the urgent need to act and collaborate, even before the oil price crash, the industry as a whole still has a long way to go. Everyone knows what needs to be done but the inertia in the industry is of great concern. The time is now to put a stop to this and make dynamic changes to the way we act and behave. Changing our approach to how we think and do business will see the industry thrive, rather than simply survive.â€
The CEO said that the industry must challenge the conventional by looking beyond standard practices of simply challenging the supply chain to trim costs. Any material change will only come by changing the fundamentals in the way we work together.
â€œAs a start, we must stop over-engineering if we are to reset the cost base. Realizing the value of the huge number of marginal fields in the UKCS will only be possible if we as an industry collaborate and cooperate to make the most of the existing infrastructure, enhanced only by the most appropriate and efficient technology and engineering know how. Applying the same old engineering practice and business model is simply not an option.â€
Lamont cited American industrialist, Henry Ford who said, â€˜Coming together is a beginning; keeping together is progress; working together is successâ€™.
â€œWhile we are seeing real efforts and actions to collaborate, it is still the exception rather than the rule,â€ he added. â€œToo many people in the industry are still holding their breath for a return to the â€œgood old days of $100 oilâ€ which simply wonâ€™t happen, and even if it does, the practices of the recent past are too wasteful in any case.â€
Lamont also challenged the industry to change its â€˜remove the old and replace with the newâ€™ culture to a â€˜brain surgeryâ€™ mindset that has underpinned Proservâ€™s growth and track record for doing more with less.
â€œThe challenges and opportunities that the industry faces with brownfield subsea developments are varied but all too often, the industryâ€™s initial response to them is not. The typical reaction to a problem is to undertake a complete system change when sometimes a more flexible and simpler approach may be appropriate, especially in a low commodity price environment. After all, you wouldnâ€™t replace your car if the windscreen wiper wasnâ€™t working.
â€œIngenious simplicity is at the core of Proservâ€™s approach. We work with our customers to maximize the use of their existing infrastructure and assets by delivering appropriate products and services specifically developed for brownfield applicationâ€”driving costs down, while providing industry leading reliability and enhanced functionality.
â€œOften, that may mean focusing on only one aspect of a system that requires attention and layering on, or working alongside the existing system, rather than recommending a complete change out. This minimizes any production downtime and maximizes the use of existing infrastructure.
â€œFor example, when the electronics in the subsea control module require replacement, either because of reliability issues or changes required elsewhere in the system, we apply subsea system â€˜brain surgeryâ€™.
â€œWe focus on solving the electronics issue rather than changing-out the entire control moduleâ€”a costly process that brings significant risks because of the changes made to all the external interfaces.
Replacing only the electronics allows for the external interfaces to remain intact. In addition, it gives operators a truly â€˜maintenance freeâ€™ subsea production control system and uninterrupted production, with state of the art system capability to allow the use of advanced system monitoring and data gathering.â€
Lamont concluded by saying that the industry has both a moral and an economic obligation to work collectively towards maximizing total production from difficult reserves.
â€œWith more than 80% of world energy use still reliant on fossil fuels, the maintenance and optimization of aging brownfield subsea fields are critical. On mature brownfield assets with dwindling production, the longer it takes to make the right and cost effective decision to maximise output, the more expensive that decision becomes.
â€œBy not changing its operating model, the industry will risk the future of that asset. A subsea asset which is losing production revenue, against a backdrop of increased operating costs, is only going to become less viable to the point of shut-down and decommissioningâ€”denying the world recovery of a limited and valuable resource.
â€œNo matter what the commodity price is now or in the future, we have it within our power as an industry to control costs, improve efficiencies and prosper. We owe it to ourselves and to the next generation.â€