FPSO

10 REASONSWHY THE OIL & GAS INDUSTRY LOVESFPSOs

©Bluewater

10 REASONSWHY THE OIL & GAS INDUSTRY LOVES FPSOs

www.fpsoasia.com

THE 14TH ANNUAL

16-19 September 2013MAX Atria @ Singapore Expo

According to the latest data, in the oil and gas industry today there are 190 FPSOs in commission around the world, 172 of which are actively operating on fields. In 2010, it was estimated that the global FPSO market was worth $5.5 billion, by 2014 it is set to hit $16 billion - a 72.5 per cent year on year increase. Growing energy demands in the Orient and Occident alike and discovery of new oil and gas fields will only serve to push the market higher.

In this piece, we take a look at some of the reasons why oil and gas companies in arenas from theArctic to the South China Sea are embracing this one-stop-shop vessel as their unit of choice.

©Modec


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THE 14TH ANNUAL


SWIFT ROLL OUTS = QUICKER TIME TO PRODUCTION

Compared to other genres of floating hardware in the oil and gas arena, the turnaround on an FPSO can be relatively short. The average semi-submersible oil rig takes between three and four years to kit out and build, and a jack-up rig between two and three years.

From laying the keel in dry dock to first launch, an FPSO could be rolled out in months to a year, or even less if an existing vessel is simply being modified into an FPSO.

LESSENED INVESTMENT = DIMINISHED OVERHEADS

As an example of how much a rig costs, the Deepwater Horizon was commissioned for $560 million in 2001 whereas an FPSO refit or fresh construction would cost considerably less.

The largest FPSO in operation today - Exxon’s Kizomba A - cost $800 million to construct, but with the ability to be easily refitted at regular intervals, it will outlast its fixed position counterparts by decades.

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FPSOS DO NOT HAVE TO BE CUSTOM BUILT

Unlike their fixed platform and semi-submersible counterparts, an FPSO does not have to start its life as an FPSO. The first ever floating production, storage and offloading unit, BP’s Castellón, was an oil tanker in a former life, and many of its descendants are also vessels that have been converted from transporters to harvesters of hydrocarbons. “Recycling” assets in this way brings inherent cost-saving benefits, although design issues may arise with regards to access/egress regulations and the layout of ship activities will differing to that for oil and gas production, particularly in the area of berthing personnel.

FPSOS CAN EVADE HARSH WEATHER

Unlike their fixed position cousins, many FPSOs are mobile units and, as such, are able to navigate away from potentially perilous weather conditions. Semi- permanent anchors can be cast off - with enough forewarning- and risers disconnected to escape adverse weather events. In cases where elusion is not an option, side thrusters can be used to maintain an even kilter.

In this way, FPSO have a strong advantage over permanent installations, particularly in the hurricane-riddled Gulf of Mexico, cyclonic activity zones like the South China Sea and iceberg-infested waters around the Arctic circle.

FPSOS CAN HOP FROM FIELD TO FIELD

FPSOs were initially conceived as the panacean solution to develop marginal fields - and so find themselves ideally disposed to a world with rapidly exhausting conventional reserves.

Once the source of hydrocarbons has plateaued or headed for decline in a specific site, an FPSO unit can then move on to its next target. Although subsea tie-backs are now increasingly common, FPSOs allow owner/operators the option to dispense with the overheads incurred by costly platforms whilst retaining value in a reusable unit.


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ABANDONMENT COSTS ARE SIGNIFICANTLY LESS THAN FOR FIXED PLATFORMS

When a well becomes economically unviable due to under-production or depletion, the removal of equipment, capping of the well and any environmental clean up that has to be enacted before the well can be abandoned, could reach into the hundreds of millions of dollars. An FPSO considerably minimises this expenditure as little permanent infrastructure has to be considered.

FPSOS ARE IDEAL FOR DEEP WATER DRILLING

With operators having to drill deeper than ever before to hit the black gold, deep and ultra-deep water plays like the Santos Basin, the US Gulf Lower Tertiary and the Arctic region are becoming more plausible choices for an oil-thirsty world. In areas such as these, where subsurface pipelines would be logistically challenging and export by shuttle tankers is increasingly expensive, an FPSO provides the best of both worlds as a tailored upstream and midstream unit rolled into one.

ASSET INTEGRITY COSTS LESSENED WITH FPSOS

Safety and maintenance is always a game of margins, and with fixed structures invariably located in harsh climates and rough waters, risks and costs are high. With smaller crews, the ability to dodge adverse weather events, and the mobility to put into port or dock for regular repair and inspection, the FPSO is its own solution to the problem of offshore asset integrity.


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FPSOS ELIMINATE THE NEED FOR COSTLY AND SPRAWLING UNDERWATER INFRASTRUCTURE

In a situation where laying pipelines is not a cost-effective solution, the FPSO is particularly well-adapted. FPSOs tap in to existing well centres with its retractable risers, negating the need for extensive undersea hydrocarbon transportation.

FPSOS ARE MORE ENVIRONMENTALLY-FRIENDLY THAN RIGS

In the post-Macondo era, the potential of the oil and gas industry to do severe and life-changing damage to the environment has been highlighted to an extent not seen since the Exxon Valdez disaster of the 1990s. While many rigs have been in operation for several decades and have a permanent ecological footprint, an FPSO can be designed and redesigned for more environmentally friendly field operations than their immovable brethren.


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THE 14TH ANNUAL

16-19 September • Singapore Expo

CRITICAL KEYNOTE INSIGHTS FROM LEADING VESSEL OWNERS, OIL OPERATORS, EPCS, SUBCONTRACTORS AND FINANCIERS

OVER

60 SPEAKERS

OVER

500 DELEGATES

OVER

10HOURS NETWORKING

W W W . F P S O A S I A . C O M

HASSAN BASMA, CEO,

BUMI ARMADA

MAARTEN VAN ALLER, COO, PETROFAC FLOATING PRODUCTION

THYL KINT, CTO, BW OFFSHORE

JON DUNSTAN, COO, EMAS OFFSHORE

JOSE LUIS RODRIGUES DA CUNHA, P55 CONSTRUCTION MANAGER, PETROBRAS

MARTIJN DEKKER, STONES FIELD DEVELOPMENT MANAGER, SHELL

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FPSO