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Murchison Topsides Removal CNR International UK Limited and Heerema Marine
Contractors Nederland SE and AF Decom Offshore
UK Limited as a Consortium
Presented by: Donald Martin, Jan Gravekamp & Ricky Ryttmar
Date: 16th November 2016
Agenda
Project starting conditions – DM
Consortium contracting model – DM
Project results from CNR International perspective – DM
The basis of success – flexibility in method – JG
The basis of success – flexibility in schedule - JG
The basis of success – project organisation - RR
The basis of success – collaboration, trust and fun – RR
Project results from HAF Consortium perspective – RR
2
3
Project starting conditions
33 Wells plugged & abandoned from topsides 33 Conductors and 66 casings strings recovered 1 subsea well isolated Oil export line decommissioned Fuel gas import/ export decommissioned Topsides production & process systems EDC Platform globally isolated and down manned
Consortium contracting model
Vehicles for collaboration – corporate and contractual,
Needs to be able to provide effective control and governance
of a broad range of project activities,
Opportunity for the suppliers to access emerging decom
markets,
Provides the customer access to complementary
technologies, assets and core competencies
Risk limitation/ sharing
Cost sharing/ reduction
Compliance with local regulatory requirements
“A consortium is an association of two or more organizations with
the objective of participating in a common activity or pooling their
resources for achieving a common goal”.
Contract mechanics
Key clauses CNRI HAF Consortium
1 Scope of work Outcome based framework of what needs to be done. How - Determines removal methods and which party executes the
scope of work split within the consortium.
2 Reimbursement Objective is cost efficiency and predictability. Objective is a fair profit margin.
Lump sum - broken down in within the consortium in accordance of the scope of work split.
3 Schedule of key
dates
Flexible 4 year removal window 2016 - 2020 inclusive.
CNRI had the right to select start date in either 2016 or
2017.
Consortium have the right to change the programme of work within
the 5 year window .
4 Asset handover /
ownership status
Handover Murchison in a safe, known and documented
condition.
Consortium ensure ongoing integrity throughout removal phases.
Title of the facilities transferred to the consortium once offloaded
onshore.
5 Safety
management
systems
Retain status as duty holder and prepare dismantling
safety cases.
Provide a safe system of work tailored to decommissioning and
deconstruction work.
Risk sharing
Key issues Approach CNRI Approach HAF Consortium
1 Major incident during removal
operations
CNRI provision of decommissioning all
risks insurance policy.
2 Waiting on weather Weather risk accepted by the consortium and included in
lump sums.
3 Limitation of liability - Damage to
assets
CNRI indemnify the consortium against
damage to 3rd party assets.
Knock-for-knock on asset and equipment spreads.
4 Delays during preparations,
offloading and logistics at the
offloading/ dismantling site.
Transfer risk through packaging of
offloading and disposal within the removals
contract
Consortiums obligation to managing the interfaces
between site preparations, offloading, quayside logistics,
vessel movements and clashes with other projects.
5 Accuracy and reliability of company
provided information.
CNRI accept the accuracy of information
represented to the consortium.
Consortium perform data collection and validation as
part of the work.
6 Failure to execute/ perform the work Termination fee Parent company guarantee
11
0 - LTIs
1 - RWC
2 - MTC’s
6 - FAC’s
Project results from CNRI perspective
Environmental Performance
- No environmental incidents
- Targeting >97% reuse & recycle
to disposal ratio
Project results from CNRI perspective
Project results from CNRI perspective – 2011 plan
13
2011 2012 2010 2013 2014 2015 2016 2017 2018 2019
Desc
Specify
Well P&A Select
Eval
2020
Facilities
Decom
Desc
Select
DSC –
Aug 29 DSC – Feb 13 Eval
Design
Select
RSC Eval RSC – Jul 13
Desc
Construct – P&A
Construct – DSC
Construct – Detailed Eng Construct – Offshore Execution
Infrastructure
removal
Desc Select
SSC Eval SSC – Jan 14 Construct – Detailed Eng Construct – Offshore Execution
Subsea Removals
Project results from CNRI perspective – 2016 actuals
14
2011 2012 2010 2013 2014 2015 2016 2017 2018 2019
Desc
Specify
Well P&A Select
Eval
2020
Facilities
Decom
Desc
Select
DSC –
Aug 29 DSC – Feb 13 Eval
Design
Select
RSC Eval RSC – Jul 13
Desc
Construct – P&A
Construct – DSC
Construct – Detailed Eng Construct – Offshore Execution
Infrastructure
removal
Desc Select
SSC Eval SSC – Jan 14 Construct – Detailed Eng Construct – Offshore Execution
Subsea Removals
Project results from CNRI perspective – 2016 actuals
15
2011 2012 2010 2013 2014 2015 2016 2017 2018 2019
Desc
Specify
Well P&A Select
Eval
2020
Facilities
Decom
Desc
Select
DSC –
Aug 29 DSC – Feb 13 Eval
Design
Select
RSC Eval RSC – Jul 13
Desc
Construct – P&A
Construct – DSC
Construct – Detailed Eng Construct – Offshore Execution
Infrastructure
removal
Desc Select
SSC Eval SSC – Jan 14 Construct – Detailed Eng Construct – Offshore Execution
Subsea Removals
The Right Scope: Studies
feeding into EIA, DP and
project contracts
Minimise OPEX
from CoP to Idle
Minimise CAPEX
through flexible
removal windows
Cost Performance
• Current overall project EFC is 10% lower than approved sanction budget
• VORs in the consortium removals contract <0.16% of lump sums
• Key learnings from Murchison inform CNRI that can reasonably anticipate 30% -
50% overall efficiencies on future decommissioning programmes
Project results from CNRI perspective
“ I may say that this is the greatest factor: the way in which the
expedition is equipped, the way in which every difficulty is foreseen,
and precautions for taken for meeting or avoiding it. Victory awaits him
who has everything in order, luck, people call it. Defeat is certain for
him who has neglected to take the necessary precautions in time, this
is called bad luck.”
Roald Amundsen (1912)
Flexibility
Flexibility through collaborative contracting
The contract is the best servant and worst master of a major project
18
Navigation through uncertainty
Difficult to define / price
Change over time (technology/ policy)
Require innovative solutions and
creative management
Numerous complex risks
Alignment of risks and interests
Collective ownership of opportunity/
risks
Collective responsibility for delivery
Equitable sharing in ratios of gain/ pain
Cost reduction/ fair margin
Topsides: Hybrid Removal
Hook-down, Preps and intermediate piece small by
AFDO
2 ea. HLV Campaigns for reverse Installation by
HMC
Topsides: Full Reversed Installation Removal
Piece small Modules become Reversed Installation
modules i.e. removed as installed
No preparations for removal from platform
All HD incl. equipment from vessel by consortium
Transportation of modules on SSCV
19
From Hybrid to full Reverse Installation
20
- ~24,500mt Topsides in 26 lifts
- SSCV Thialf 4 trips to Vats
- SSCV Hermod 1 trip to Vats
- Preparatory work for lifting from SSCV
o Topsides splicing work
o Lift point installation as required
o Rigging Installation
Scope 2016
21
Right to defer
Exercised March 2015
Tender work
Hermod-Thialf change
06 June 1016
RSC CONTRACT September 2014
FULL RI
PROPOSED
MAY 2015
FULL RI AMENDED JUNE 2015
FULL RI
ONE CAMPAIGN
PROPOSED
NOVEMBER 2015
FULL RI
ONE CAMPAIGN
AGREED
DECEMBER 2015
MOBILISATION 18 JUNE 2016
Offshore Completion
27 August 2016
Flexibility
Integrated Offshore Planning
- Full Integrated schedule
- Each job card planned in detail on manpower level
- MSO
- NDT
- RAT
- Scaffolding
- Fitting and Welding
- Asbestos (where applicable)
- Splicing (cutting cable trays, power cables, piping)
Used Offshore for monitoring progress
Offshore Planning, Offshore
Daily Progressed S-Curve and 4 day look ahead
PTW System
• E-vision Used
• No work on platform w/o permit
• Identified hazards and controls on permit
• Dedicated PTW controller
• Planning meeting to determine Permits
• PTW meeting to request for and activate permits
All presented this presentation is subject to detailed engineering
Tools to be predictable:
- Thorough platform inspections and engineering
- Well prepared job cards
- Well prepared plan to the greatest detail
- Well prepared plan regarding logistics
- All procedures in place to anticipate on unknowns e.g. asbestos, Norm etc.
- Planner o/b to allow to change the planning
- Experienced personnel
- Crane o/b the platform
- Tailor made Safe Systems of Work (SHE Management Interface Document)
Predictability
Company :
Consortium EPRD :
Subcontractors :
Main Parties Involved
The Basis of Success – Project Organisation
27
The Basis of Success – Cooperation, Trust and Fun
28
Cooperation, Trust and Fun – Cont’
29
Project Results from a HAF Perspective
30
0 LTI Total duration Topside campaign:
81 days
Project Results from a HAF Perspective Continued
Demonstrated flexibility to in order to de-risk CNRI’s completion schedule for plugging wells
- Maximise and utilize own resources
- SSCV Hermod and Thialf
- AF Environmental Base Vats
- Engineering resources
By doing so HAF demonstrated flexibility and cooperation to maximize project outcome
- Between Consortium partners
- Between Consortium and Company
Because of the above, HAF maintained and improved on the Contract program;
- Safeguard Schedule
- Safeguard Budget and Cost
- Safeguard Margins
Matured cooperation beween consortium partners, both onshore and offshore – forms good
basis for further cooperation.
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32
To be continued….