drillsafe – industry trends & opportunities · drillsafe – industry trends &...
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Working together for a safer world
DrillSafe – Industry Trends & Opportunities
Lloyd’s Register Energy - Drilling
Lloyd’s Register Energy - Drilling
Agenda
• Introduction Lloyd’s Register Energy
• Energy Market – Global view • Drilling Market trends
• Industry wide Challenges
• Example of Key Solutions
• Future proofing our Organization
Lloyd’s Register Energy - Drilling
How we started
Our heritage is genuinely historic • formed in 1760 in Edward Lloyd’s coffee house • to examine and ‘classify’ merchant ships according to their
condition
We have 250 years of global marine history • the world’s first ship classification society and this remains our
core activity today
…and over 100 years serving other industries across society • from energy, rail, food safety to power and manufacturing
Heritage an important part of our culture … and forward-thinking approach to our business
Lloyd’s Register Energy - Drilling
Lloyd’s Register today
• £1 billion turnover
• Over 9,000 employees worldwide
• Four business divisions:
• Marine
• Energy
• Rail
• Management Systems (LRQA)
• Three regions: Asia, EMEA (Europe, Middle East and Africa) and Americas
Lloyd’s Register Energy - Drilling
Our governance
• Organisation has new structure from July 2012
• New parent, Lloyd’s Register Foundation, a registered charity concerned with safety of life and promoting education and research
• Lloyd’s Register Group Limited (Lloyd’s Register) now heads operating group, 100% shares owned by the Foundation
• No external shareholders / non-profit distributing
• Lloyd’s Register Foundation compliant with UK Charities Act
Lloyd’s Register Energy - Drilling
Acquisition growth and partnerships are an important strategic factor for us extending our service platforms:
Expanding the Energy Business
2005 2008 2009 2012
Capstone RBMI
2013
Process engineering and safety
Plant integrity and reliability
Joint venture:
Risk management consultancy
Noise and vibration analysis Drilling expertise Subsea domain expertise Human factors expertise
Lloyd’s Register Energy - Drilling
Agenda
• Introduction Lloyd’s Register Energy
• Energy Market – Global view • Drilling Market trends
• Industry wide Challenges
• Example of Key Solutions
• Future proofing our Organization
Lloyd’s Register Energy - Drilling
• The long term energy supply grows by >1/3 growth through 2035 to meet demand (1.5% CAGR) • 80% of Energy still to be from fossil fuels by 2035, with natural gas growing the fastest of the fossils • All fuels show growth (Renewables 6.4%; Nuclear 1.9%; Gas 1.9%; Oil 0.8% CAGR 2035)* • Record E&P spending expected in 2014, but at a slower trajectory • Greater uncertainty over oil price than last year • Potential margin squeeze and exploration/development implications
Energy Market – Global view
World Energy Outlook: BP 2014
Primary energy production
BIllion toe
9
Canada
Multi-Year E&P Spending Forecast
United States
Rest of World
Barclays 2013
IEA crude oil price forecast
International Energy Agency July 2014
*World Energy Outlook: BP 2014
Lloyd’s Register Energy - Drilling
Drilling Market Trends
• 2014-2018: Large number of rigs coming into the market with 230 additional units in 2018 • Seismic activity down (predictor for rig demand) • Strong decrease in floater day rates - Jack up’s still strong, but decline expected, as supply increases • Rates trend towards operating cost level • Margin operators and drilling contractors down
0
10
20
30
40
50
60
70
80
90
100
2012 2013 2014 2015 2016 2017 2018 2019 2020
2012 Forecast
Aug-14 forecast
New-build activity
Lloyd’s Register Energy - Drilling
Drilling Market Trends
A. Cold stacked rigs coming into market.
B. Lifetime extension & New Build start
C. Oversupply
D. Rates Falling/ Sublets increasing
E. Cold Stacking Starts Rig
dem
and
Time
A
B
C
E
D
Lloyd’s Register Energy - Drilling
Agenda
• Introduction Lloyd’s Register Energy
• Energy Market – Global view • Drilling Market trends
• Industry wide Challenges
• Example of Key Solutions
• Future proofing our Organization
Lloyd’s Register Energy - Drilling
Future Technology, Innovation & R&D
Spending on research and development by the oil and gas industry will increase by at least 10 per cent in 2015.
Top 4 drivers as indicated by 250+ professionals and executives from the international oil & gas sector:
• Improving operational efficiency
• Improving safety
• Reducing costs.
• Attracting competent resources
Full findings are expected to be published later this month (September). It is anticipated that the survey will become an annual event.
Lloyd’s Register Energy - Drilling
Industry wide challenges
Industry issue Impacts Foreseen solutions
Shortage of skilled professionals (attracting competent resources)
Barrier to growth across industry Competence assessments and Management, training, technical advice, contracted in technical services
Concerns about rising operating costs and squeezed margins (reducing costs)
Pressure to extend asset life, reduced investment
Asset management, Reliability Engineering, EOR Technology
More global, complex supply chains
(improving operational efficiency)
Reliance on bigger supply chain partners to serve global needs Tougher regulation and rising costs More standardisation
Global Vendor inspection, Smart inspection
Industry safety culture becoming more deeply embedded
(improving safety)
Senior leadership increasingly involved Risk based, rather than tick box
Safety consultancy, holistic risk management approach, People-Systems-Equipment approach
Lloyd’s Register Energy - Drilling
The Energy Challenge
Traditional forms of energy are harder to find - deeper, more hostile, unconventional. As we push the boundaries, new technology present both opportunities, challenges and risks.
15
Lloyd’s Register Energy - Drilling
Agenda
• Introduction Lloyd’s Register Energy
• Energy Market – Global view • Drilling Market trends
• Industry wide Challenges
• Example of Key Solutions
• Future proofing our Organization
Lloyd’s Register Energy - Drilling
Industry challenge: Objectively assess risk and determine whether to continue with, or suspend drilling operations. Particularly crucial, given high cost of pulling BOP (~ $1million per day)
Industry needs: Transparent and consistent decision making acceptable to all stakeholders Quick and accurate determination whether to pull or not to pull Safety of personnel, environment, and equipment
Challenges further compounded because the BOP is:
• one of a few systems that combine multiple, critical functions • highly regulated • not visible when in operation
Example of Key Solutions; BOP Risk Model
A simple component failure in the BOP may
result in non-compliance and have severe consequences 18
Lloyd’s Register Energy - Drilling
LR has met extensively with oil and gas regulators around the world. All have stated they will accept the Risk Model output
as an acceptable means of assessing risk.
Risk model rapidly assesses risk in an unbiased fashion using host nation’s regulations, as well as company specifications and procedures
• Helps operators manage risk to personnel, environment and assets
• Enables operators to make objective decisions based on sound engineering principals and provides a traceable record
• Can reduce days of non-productive time into hours
• All possible equipment failures and their affects are considered, eliminating the need for last minute analysis when component fails
• Risk Model does not take away or replace human decision making
Example of Key Solutions; BOP Risk Model
19
Lloyd’s Register Energy - Drilling
Continuous Improvement
Example of key Solutions; Holistic Risk assessments Balanced approach to operational integrity
EQUIPMENT PEOPLE
PEOPLE
interaction of people with one another, with equipment and with systems
(Human)
SYSTEMS
working methods and data collection, access and availability at point of use
(Organizational) EQUIPMENT
hardware integrity and performance
(Technology)
SYSTEMS
Lloyd’s Register Energy - Drilling
Massive effect
Internation-al impact
Massive effect
Extensive damage
More than 3 fatalities 5
Major effect National impact Major effect Major
damage
Permanent disability / up to 3 fatalities
4
Local effect Consider-able impact
Localized effect
Localized damage
Major health effect / injury 3
Minor effect Limited impact Minor effect Minor
damage Minor health effect / injury 2
Slight effect Slight impact Slight effect Slight damage
Slight health effect / injury 1
No effect No impact No effect No damage No health effect / injury 0
Happens several times per year in a location
Happens several times per year in our company
Incident has occurred in our company
Heard of in E&P industry
Never heard of in E&P industry
Likely occurrence Probable occurrence Credible occurrence Unlikely occurrence Rare occurrence
> 1 occurrence / year
10 -1 to 1 occurrence / year
10 -3 to 10 -1 occurrence / year
10 -4 to 10 -3 occurrence / year
10 -6 to 10 -4 occurrence / year
E D C B A
Security
Reputation
Environment
Assets
People
Severity Rating
Increasing Probability Consequence
Manage for continuous improvement
Incorporate risk reduction measures
Intolerable
EQUIPMENT
PEOPLE
SYSTEMS
Business Risk
Example of key Solutions; Holistic Risk assessments
Lloyd’s Register Energy - Drilling
Example of key Solutions; Holistic Risk assessments
0 10 20 30 40 50 60 70 80 90
100
Equipment Performance
General Management
Quality Management
HSE Management
AIM Management
Structure & Responsibility
HR Management & Communication
Training
Competence
Equipment Condition
Equipment History
Equipment Life Cycle
Lloyd’s Register Energy - Drilling
How Balanced is your Act?
People - Human
Inefficient Operations
Systems - Organizational
Non Compliance
Accidents / Incidents
Equipment - Technology
Non Productive Time
Breakdown Maintenance
Lloyd’s Register Energy - Drilling
Agenda
• Introduction Lloyd’s Register Energy
• Energy Market – Global view • Drilling Market trends
• Industry wide Challenges
• Example of Key Solutions
• Future proofing our Organization
LR Foundation and LR Group invests in R&D from early science to applied research
Emergent technologies
Human & social factors
Structural integrity and systems performance
Resilience engineering
Risk Exposure
Next Resources
Life Extension
Uptime and Efficiency
Smart Supply Chain
LR Foundation LR Group
Commercial-in-Confidence
Lloyd’s Register Global Technology Centres are set up to respond to Offshore and Marine Challenges
• £100 million in two global technology centres
• For Energy - 5 core Technology programmes: • Risk exposure • Next resources • Life extension • Uptime & Energy Efficiency • Smart supply chain
• Research collaboration with internal and external stakeholders
Commercial-in-confidence
Southampton Global Technology Centre – working with the University of Southampton at the heart of world-class marine engineering and naval architecture Disciplines specialised in to meet current and future maritime challenges: • ship design and naval architecture, • fluid dynamics and acoustics, • oceanography, and • humanities and social sciences
Singapore Global Technology Centre – working with global research network to advance technical innovation and support economic growth in the region Research themes of Joint Industry Projects: • Subsea drilling and well control equipment • Risk (including asset performance management and life extension) • Deep-water / floating offshore installations • Enabling / emerging technologies (including renewables)
Next Generation Risk Management Tools
• Time dependent model
• Continuous 3D risk picture
• Enhanced prost processing
• ALARP analysis
• Detailed accidental loads
• Offshore and onshore
• Oil and Gas industry is continuously looking to reduce risk
• Complexity of statistical models and physical phenomena models has increased
• Amount of data is overwhelming to anyone other than risk analysis experts
• EXPLORE translates information to a usable format that safety engineers and managers can understand and use to reduce risks
EXPLORE – Next generation technology for risk assessment
Condition Based Monitoring A New and Safe Way to Detect Forces on Riser Tensioners
Early Warning
Transocean is using the system to establish accurate, empirical baselines for normal tension variation, and this gives them the means for detecting problems in the making or simply knowing when service or exchange needed.
This new way monitoring forces can reduce risk of downtime by providing an early warning of problems, which cause unplanned stresses on the tensioners.
View of the Riser Tensioners over the moon pool
• Problems with the marine riser tensioners (MRT) on drilling rig lead to downtime
• Lloyd’s Register collaborated with client to solve the problem of how to measure the forces on the MRT
• We identified fiber optic sensor system that met these criteria:
• Free of any ignition source
• Lifespan of 20 yrs without needing calibration
• Would not violate the OEM
• Client calculated the mechanics for optimal sensor placement
• Now they can monitor the stresses and anticipate when equipment needs repair or replacement
Wave-in-deck loading Making waves to save lives
Wave in Deck is a collaborative project between Lloyd’s Register Global Centre (GTC) and the Institute for High Performance Computing in Singapore.
The project uses technology to simulate the devastating waves formed in extreme oceanic storms and measure their impact on offshore fixed platforms. The aim is to determine how high above sea level a fixed platform should be to avoid being structurally damaged by these extreme waves. This crucial distance is known as air gap.
If the air gap is not high enough a platform can be engulfed and collapse if it is hit by a large wave.
Wave in Deck researchers are using computer simulations to measure the impact of these waves of on the deck of a virtual platform. This will help to determine the optimum air gap for fixed platforms and assist design engineers in the design of fixed platform structural shapes and interfaces.
Why Wave-In Deck research is crucial.
Seabed subsidence and rising sea
levels due to global warming mean that
new research is necessary to predict
wave-in-deck loadings for new designs
and to reassess the impact on existing
fixed platforms. The knowledge gained
from the research and studies will be
used to help design a state-of-the-art
wave basin in Singapore.
Smart Asset Management RFID as an enabler
RFID application in supply chain and operation could have a dramatic impact on reducing downtime, enable asset optimisation, risk based inspection, assurance and compliance.
Benefits include :
• Instant identification
• Not lost through illegible stamping, mechanical damage or corrosion
• Electronic upload. Can be used to link to: Manufacturing and repair records, Maintenance history and database
• Usage, service history and loading
• Installation records and Well file, What was run into well, Who ran it and when
Smart Asset Management through
Secure tracking
Real-time ID of genuine parts
History and maintenance record
End-to-end life cycle tracking
Context specific recommendations
Rich data for analysis
Enhanced Oil Recover
Partners: Lloyd’s Register Consulting, LR Senergy, Welltec, and DTU
Objective: Develop novel technologies for predicting and performing optimal control of the flow between wells and the reservoir.
Funding: DKK 14M from The Danish National Advanced Technology Foundation
Total budget: DKK ~29M
Duration: 4 years
Work Packages:
WP1: Well flow modelling
WP2: Reservoir-to-well connectivity
WP3: Reservoir uncertainty analysis
WP4: Integration and optimization
OPTION - Optimizing Oil Production by Novel Technology Integration
Lloyd’s Register and variants of it are trading names of Lloyd’s Register Group Limited, its subsidiaries and affiliates. Copyright © Lloyd’s Register [Entity]. 2013. A member of the Lloyd’s Register group.
Duco de Haan SVP – LR Energy - Drilling E duco.dehaan@lr.org
Working together for a safer world
ModuSpec and WEST Engineering Services are now Lloyd’s Register Energy - Drilling
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