Efficiency Improvements Keep Deepwater Afloat, Reducing Costs Bit by Bit

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Researched by Industrial Info Resources (Sugar Land, Texas)--As oil prices remain low halfway into the second year since the price dropped, it would seem a wonder that multi-billion dollar offshore oil projects would still be anything more than the ravings of a mad man. However, one of the things that this lean time is proving is that the market is adept at trimming fat. With prices not permitting waste, offshore operators and service providers are looking at ways to improve efficiency.

The addition of some equipment and the removal of others should mean an increase in small-scale project numbers. As operators look to trim costs, bringing in outside help may be seen as an excess cost, meaning potentially fewer opportunities for service providers. However, even International Oil Companies (IOCs) do not generally manufacture their own parts, so opportunities may still be lurking in the waves for small parts suppliers and others who can supply equipment. While these smaller initiatives may not garner much media attention, knowing the equipment running out there and the right person on the platform or in the office could go a long way.

Many types of efficiency improvement can be carried out by operators' existing crews on site; however, regardless of their skill, new parts and equipment will still be needed, which will be opportunities for those who can supply them. Thus, cost cutting is likely to come in the form of cutting outside contract labor. Flying or boating technicians and crews out to platforms and Floating Production, Storage and Offloading (FPSO) facilities and then having to house them for the duration of the work are on top of the cost of the labor itself. However, parts suppliers whose products can demonstrably improve process efficiency or reduce maintenance downtime may yet find a market by getting involved with offshore operators early on while each operator searches to standardize aspects of their respective processes and equipment.

Efficiency projects can take many forms, however, including major undertakings such as the redesign of the Equus platform topsides, owned by Hess Corporation (NYSE:HES) (New York City), in order to reduce the platform's weight, utilize new asset management software to monitor and improve turbine performance, and to further standardize certain types of process equipment. As monitoring and big data find more of a foothold in the industrial world, small electronics manufacturers who supply components for the monitors may yet find demand for their goods in this market. Where major players such as GE Oil & Gas, a subsidiary of General Electric Company (NYSE:GE) (Fairfield, Connecticut), will be the suppliers and installers of these big data solutions, the material components they use to gather data must be supplied by someone.

Industrial Info is tracking over 2,000 offshore installations around the world with more than 7,000 contacts between them. These include FPSO facilities, tension leg platforms (TLP) and even offshore compressor platforms working in both oil and gas production offshore. Within these consistently updated profiles, Industrial Info tracks more than 5,000 pieces of equipment offshore, including gas turbines, internal combustion engines, electric motors and separation units.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.