The American oil company and Ekofisk-operator, ConocoPhillips, along with its licence partners, are investing NOK 8.1 billion in the Ekofisk Area Growth Project. The objective is to increase the rate of oil recovery in a profitable and safe manner. The challenge is how to combine old and new installations, parallel to the running production. A total of 6,000 man-years, mostly employed by subcontractors, will be invested in the project until 2005, when the Growth Project is completed.
One key part of the project will be the construction of a new wellhead platform, which will be connected to the existing Ekofisk Complex. According to Bard Atle Hovd, who is the head of the Ekofisk Area Growth Project and a former platform manager at Ekofisk, ConocoPhillips brings decades of offshore experience to this effort. He notes that oil has been produced from fixed installations on Ekofisk since 1974, and reconstruction and modification processes are continuously on-going on the field.
Preparing for the future
As ConocoPhillips started production from the Ekofisk II facilities in 1998, it became obvious that because there were limited slots on current installations to drill new wells and the processing and water separation facilities need to be increased, its production capacity would not be able to satisfy the estimated future production plans. The Ekofisk Area Growth project has been conceived to manage these complex issues.
Hovd says the project has been challenging. "Upgrading offshore modifications is like demolishing an old house; when you remove something, you always find something hidden," he says. "In addition, both the weather conditions and maintaining the rapid pace of the project have been a great challenge."
Yet Hovd remains confident the project will be completed successfully. "Project management is about good planning, preparation, and having sufficient information to make the right decisions. If circumstances require that we must revise these decisions, we must evaluate the consequences before we act."
Getting to zero
ConocoPhillips has set very ambitious goals for safety, health and environment, identified by the by the phrase "Getting to zero". The company encourages teamwork and building the right attitudes as the key in this effort. The emphasis on zero tolerance stands like a rock in the company's management philosophy.
Hovd says that a great deal of the project's success is related to the subcontractors' performance. ConocoPhillips has been very satisfied with the quality of the work delivered by its business partners so far.
The success of the project is also linked to the company's efforts to integrate the subcontractors in the common safety, health, and environment (SHE) policy. Says Hovd: "We concentrate a lot on safety and see no contradictions between safety and effectiveness. Rather these issues depend on each other. Thanks to their valuable expertise in complex offshore operations, 70 per cent of the subcontractors are Norwegian."
He continues: "Most of my time is occupied by following up the 'Getting to zero' philosophy. We strongly believe the best way to increase efficiency is to reduce unintended incidents." *
Quality beyond price
The company is cost-effective and price-conscious, but there are also other factors to be considered when making a NOK 8.1 billion investment. "We must not only focus on man-hour rates and quota prices but on what we get back in terms of quality of facilities, resources and expertise used to execute the project," says Hovd.
When ConocoPhillips and its license partners decided to put another NOK 8.1 billion into Ekofisk, it was based upon a strong belief in the field's future profitability. It was also based upon the fact that the North Sea is one of the safest and most predictable areas for major investments worldwide.
ConocoPhillips North Sea Operations accounts for about 17 per cent of the ConocoPhillips Group's total oil and gas production, and is ConocoPhillips' biggest business unit outside the US. The Ekofisk Area Growth project was not seen as an extremely profitable project at corporate level. But once again, background experience has shown that the Ekofisk field always delivers beyond expectations.
