VALUE PROPOSITION OF OFFSHORE STEEL STRUCTURE DECOMMISSIONING

Image

Value Proposition of Offshore Steel Structure Decommissioning Project by Mr. Ahmad Rizal bin Abdul Rahman

Entitled Value Proposition of Offshore Steel Structure Decommissioning, the seminar presented by Mr. Ahmad Rizal bin Abdul Rahman focused on the D28 EPCIC Project, which has enjoyed many successes since the very beginning of its’ development. As a Staff Structural Engineer with Petronas Group Technical Solutions (GTS), Mr. Ahmad Rizal proudly shared the process and the reasons behind the success of the D28 project at the annual International Construction Week 2019 held at the prestigious MITEC in Kuala Lumpur last March.

According to Mr. Ahmad Rizal, majority of the offshore oil and gas platforms in existence have always been installed using the conventional crane barge. This has resulted in significant installation costs as the mobilisation and charter rates for the steel vessels are excessively expensive. In order to minimise the costs of installation, oil and gas companies in search of new wells have little choice but to be innovative and ready to change the norms in which the installation of other established offshore platforms are accustomed to.

With that in mind, the team behind the D28 project had embarked on their exploration to find a site that is nearer to the shore in order to reduce the distance, and in turn, minimise the time- as well as cost-consumptions of installing their platform. As per the usual method of appraisal, the team had drilled more wells at the site in which they deemed best after the discovery of hydrocarbon at the first drill in order to find more information regarding the site as well as to determine its’ economic feasibility for further development. After ticking off all criteria, the offshore platform site was determined to be 85 km north-west of Bintulu, Sarawak, and that is where the legendary D28 success stories took place.

Mr. Ahmad Rizal stated that some of the oil and gas wells had been reserved, so early developments of these wells had many resources in the early 2000s whereby oil prices were arguably good. Due to the resources being used up earlier on, the current crisis faced in the industry is that there is a lack of large oil fields to be developed. Therefore, projects like the D28 platform had to explore smaller-scale marginal fields in order to sustain in the industry. Although this condition might mean that there are less resources to be gained, it is nonetheless an opportunity not to be missed.

Based on the objective to minimise the costs of installation, the D28 project had carefully gone through the process of selecting the best site and materials. In terms of the condition in which the site is to be placed at depends on the depth of the water, whereby shallower waters allow for a cheaper execution. The weight of the topside of the platform had also been considered to ensure that it is light and small in order to keep its’ fabrication and installation costs low. Apart from that, D28 also managed to keep their costs low by drilling only six wells compared to other larger-scaled platforms, which also means that they have use conductors.

The major contributor to the success of the D28 project in its quest to be cheap but feasible lies in its’ lightweight structure. Unlike other larger-scaled contemporaries using the typical massive and hence, costly, structures of offshore platforms, the experts and professionals behind the installation of the D28 project applied a lesser-favoured installation strategy by using a rig-installed structure, most notably the Jack-up Rig method. The most significant advantage of using the rig-installed structure such as a jack-up rig is that it does not add any extra masses onto the platform due to the fact that it is small and lightweight in itself and therefore, economic. On top of that, the water-depth in which the D28 platform is based at is only less than 60 metres and it has got a lifting-span of merely about 550 tonnes only, making it easier, and thus, cheaper to charter and install the steel structures to the offshore site.

The installation process of the D28 platform is a unique one due to its lightweight structure and design. The fact that the lightweight topside was installed after the drilling and installation of its jacket were completed, made possible by using the jack-up drilling rig, deviates from the installation process of other established offshore platforms, making it an even more exceptional project. Although the life-expectancy of the topside is only 15 years, which is about 50% less than that of other larger platforms, the overall costs of installing the D28 platform is nothing short of remarkable.

In fact, the exceptionally low cost of installing the D28 offshore platform is not the only applaudable achievement in which the project has accomplished. It is with great honour that this project has also been successful as the first offshore platform to use the jack-up rig system during its installation process, the first to have conductors as support to its lightweight structure, as well as the first to be fabricated under a covered workshop. It is worth noting that fabricating structures under a covered workshop has benefitted the project immensely in terms of reducing its time-consumption, and in turn, costs as well, due to the fact that natural bad weather conditions could not deter its fabricating process. Not only did the D28 project manage to reduce the duration of time during its fabricating stage, the method used in the piling part of the installation stage also played a role in minimising the time it took to complete the project mentioned. Unlike other platforms which normally take around 8 hours per well by using the welding method during the piling of the structures, D28 used mechanical connectors instead, which reduced the time to only 1.5 hours per well offshore.

All in all, the installation of the D28 offshore platform only costs a meagre 26 million USD, and given that the installation process started in March of 2018, the total time taken to reap its harvest was only 8.5 months, which means that oil could already be extracted from that platform as early as November in that same year. Although it is undeniable that the jack-up rig is unique in that it is only usable with the specific conditions in which D28 was subjected to, Mr. Ahmad Rizal concluded his seminar by attributing these major successes of the D28 project to the risky yet achievable “doing things differently” mindset that those involved in this project had throughout its completion.