Asia-Pacific Assessment: Trends and Challenges

for Structural Engineers

An in-depth analysis to identify and address the specific challenges for structural engineer
within the Asia Pacific markets
Jamie Davies

Introduction
Whilst most people would consider the Asia-Pacific offshore oil industry as one of the verge of major
change, how many of us have sat back to take the time to understand the entire landscape? Many of
us will get swept up in the excitement of an ever changing marketplace (and understandably so)
without truly understanding the impacts that these changes are having on our day-to-day roles.
The Structural Integrity Management Analysis will give you the opportunity to understand how your
peers are approaching the challenges faced by structural engineers and whether you are prioritizing
the right areas in your SIM program.
Within the analysis, well assess such areas as:
What projects and technologies are currently being prioritized
How much of a role is monitoring technology playing in maintenance and production
operations
What are the major challenges being faced by structural engineers throughout the region
Whether metocean data is being given the credit it deserves and requires
Where the ISO standards will have the biggest impact throughout the region
Should you have any additional questions regarding the survey or the content, feel free to email
Jamie Davies on jdavies@fc-bi.com.

Who did we speak to?

How would you describe your role?
Structural Integrity
Maintenance and Repair
Inspection
Structural analysis
Naval/Marine
Department Head
Board Member
Sales/Business Development/Marketing
Other

How would you describe your organization?

20%

Operator

26%

Tier 1 Contractor
Tier 2 Contractor

9%

Regulatory
Government

4%
9%

Other

32%

Which region are you primarily based in?

Middle East
North America
Africa
Europe
Oceania
Asia-Pacific
0

10

20

30

40

50

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

60

Industry Trends
Q. How much growth would you expect in the following areas?

Brownfield
Development

FPSO's
50

50

40

40

30

30

20

20

10

10
0
%

12.82

25.64

46.15

15.38

Greenfield
Development

0
%

30

40

12.5

50
40

40

30

30

20

20

10

10

2
15

Lifetime Extension

50

1
2.5

2.38

14.29

33.3

38.1

11.9

0
%

8.11

2.7

40.54

35.14

13.51

(5 = High Priority, 1 = Low Priority)

As you can see from the data here, the industry is leaning more and more towards Brownfield
development projects. It would be vastly incorrect to assume that Greenfield developments are
finished, though such projects are certainly taking a back seat.
In terms of Brownfield Development, Life extension strategies and the growth of FPSOs, there is
certainly a shift towards a more commercially-efficient operation. All three areas suggest to us that
operators are not only concerned about lack of opportunities for Greenfield projects, but also that
the profits margins within current operations need to be put under tighter scrutiny.
The data also demonstrates the continued importance of Structural Integrity Management practices
the growth of SIM is not a coincidence when you consider the renewed emphasis on profit margins
and operational efficiency. It should not be considered the industry norm, as if investment is
continued into the older structures and fields in the region, the last fault anyone wants is one in
which the structures end up on the seabed.

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

Although it is an area which we have all assumed is growing strongly, here we can see that FPSOs
are certainly a trend for the future. The practically, and cost effectiveness, of having a mobile
production facility, clearly supports the commercially driven objectives of the operators, whilst also
enabling marginalized fields to be harvested in a cost-effective manner.

Improved Oil Recovert

Enhanced Oil Recovery

60

40
35

50

30
40

25

30

20
15

20

10
10

0
%

14.29

57.14

22.86

5.71

0
%

2.86

14.29

37.14

34.29

11.43

(5 = High Priority, 1 = Low Priority)

What is slightly more surprising is the relative reluctance to incorporate new technology for
Improved and Enhanced Oil recovery. Considering the age of the structures in the Asia Pacific
markets, and the cooling off of Greenfield projects, wed assume that IOR and EOR would stake a
much higher claim. The relative laissez-faire attitude to the technologies is somewhat unusual
considering the benefits on offer.
One might question whether this is because the region is more conservative that the rest of the
world weve seen from previous research that the Asia Pacific markets generally follow trends
from the North Sea and Gulf of Mexico. With IOR and EOR technologies gathering steam elsewhere,
maybe this analysis next year will tell a different story.
Q. How much of a roadblock would you consider current legislation for the development of the
offshore oil industry in the Asia-Pacific markets?

5
4
3
2
1
0
%

5
1
4.65

10

15
2
0

20
3
27.91

25

30
4
37.21

35
5
30.23

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

40

This is certainly an interesting question, as we should also ask whether the legislation is the actual
road-block or a lack of legislation is the real reason. The general feeling around the industry here is
that the latter would be more accurate.
Irrelevant of what the true question should actually be, the Asia-Pacific markets are certainly behind
the North Sea. The rigid structure in place for British, Norwegian and Dutch operators enables
creates an effective and comprehensive roadmap for life extension strategies and, ultimately,
decommissioning projects. When you look at examples in the Asia Pacific markets, complications,
like Production Sharing Contracts for instance, disrupt the forward movement of the industry on the
whole.
That said there are forces at work to correct this challenge.
Petronas and The Department of Safety and Health (DOSH) have recently launched the Offshore
Self-Regulation Management System (OSR-MS) to provide a more comprehensive framework for
management of offshore assets in the Malaysia waters. We suspect that this initiative will also feed
out to other markets within Asia-Pacific.
The system was developed based on the internally recognized PAS 55 Asset Management Standards
and is in compliance with DOSHs statutory requirements. It ultimately allows the industry to make
sensible and business effective decisions to minimize the risk of major incidents, and reduce HSE
hazards to individuals working in the industry.
Whilst this would still seem short of the standards which are set in place for the North Sea, this is
certainly a very positive step, and one on which a comprehensive and efficient regulatory standard
can be based upon.

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

Current Priorities
How much of a priority would you consider
operational efficiency within your
organization?
50
40
30
20
10
0
%

4.65

18.6

37.21

39.53

How much of a priority would you consider

structural integrity management within the
Asia-Pacific markets?
50
40
30
20
10
0
%

11.9

19.05

38.1

30.95

(5 = High Priority, 1 = Low Priority)

As you can see from the data above, the shift to brownfield developments is supported by an
increased emphasis on operational efficiency. As with the trend in the growing number of FPSOs,
there is certainly a drive to gain the greatest commercial value out of all major investments made.
Whilst there is a clear benefit to having mobile production facilities, the increased emphasis on
structural integrity management practices also demonstrates the need to drive higher profit margins
on fixed structures also. Decommissioning is an expensive task, the longer a structure can operate in
a safe and efficient manner, the lesser the blow of decommissioning.

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

Market Overview

Age of Structure
40+
35 to 40
30 to 35
25 to 30
20 to 25
15 to 20
10 to 15
0 to 10

Number of structures
16
75
116
363
262
226
191
484

How much of a challenge are aging assets

in the Asia-Pacific region?
5 (High Priority)
4
3
2
1 (Low priority)

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

30.23 (%)
37.21
27.91
0
4.65

Focus on Structural Integrity Management

Q. What would you consider the main challenges for Structural Engineers?

1. Absent data
2. Structural monitoring
3. Corrosion
4. Implementing new technology
5. Efficient inspection strategies
6. Condition monitoring
7. Risk identification and assessment
8. Recruitment
9. Investment from operators
10. Lack of experience in the region
11. Quality oversight models
12. Structural Fatigue
13. Lack of regulation to support such practices
14. Environmental Loading/1000 Year wave
15. Obsolescence management

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

Considerations for Structural Engineers

Q. How much of a priority is online/real-time monitoring technologies play in your role?
5 (High Priority)
4
3
2
1 (Low Priority)

17.65
47.06
23.53
8.82
2.94

Interesting enough, online monitoring tools seem to be playing a considerable role within operations
at the moment. Though not as much as in the North Sea or Gulf of Mexico markets, it is certainly
higher than most would have previously assumed.
Throughout our research, one of the biggest themes which seem to be developing throughout the
region is the idea of shifting towards a more proactive SIM IMR strategy. Whilst this could be
considered a pipedream, it will always be the ultimate goal. It will be impossible to entirely remove
the concept of reactionary projects, though more comprehensive monitoring tools can most
certainly improve the turnaround time.
The usage of such technologies seems to be high at the moment seems to be high, though there can
certainly be more effective and efficient management and implication.
Q. How prominent would you consider risk-based inspection strategies in the Asia-Pacific
markets?
5 (Very)
4
3
2
1 (Low)

18.18
48.48
30.30
3.03
0

Q. What would you consider the major roadblock for the implementation of RBI?
Unwillingness for engineers to make judgment calls
Industry being too process driven
Substandard approach to safety
Lack of understanding of the RBI methodology
Absent data
Too much reliance on Ex-pat workers
Lack of Experience
Conflicting standards and codes
Lack of regulatory support

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

The use of risk-based inspection strategies is one area which has been under considerable debate in
recent years. Although the regulators in both Malaysia and Indonesia now readily accept the use of
the practice, there has been considerable resistance for operators to demonstrate the need to
implement RBI to shift to RBI from time-interval strategies, it has to be justified.
When you take into consideration the age of structures throughout the region, this need is now
becoming much more apparent.
The challenge now, is implementing a fairly entrepreneurial practice into an industry (and region)
which could be considered to be very conservative and process driven. As you can see from the data
above, a lack of understanding of the basic RBI methodology, experience and support from the
regulators makes implementing such a practice very difficult.
It is also quite interesting that whilst the majority, more than 60%, consider RBI to be highly relevant
to their roles, around a third of the audience do not. This is highly unusual, as most would see RBI as
a business decision as well as an engineering one. Prioritizing the most at risk platforms, investing
more time and budget in these assets to ensure long-term commercial operations, would be
considered a very sensible business decision. However, a third of our respondents do not consider
RBI as a priority.
Compared against previous statistics which demonstrate that operational efficiency would be
considered a high priority within their business (78%) this makes a more unusual case. For most,
RBI and operational efficiency would go hand in hand.

How much of an impact do

you think the shift in
standards (API to ISO) will
impact engineers in the
Asia-Pacific markets?

Would you consider the shift

from API to ISO a positive
move for the Asia-Pacific
markets?

70
60
50

No

40
30

Yes

20
10
0
%

6.06

57.58

24.24

12.12

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

Where do you think the shift in standards will have the

biggest impact?

The shift in standards is one which has been highly publicized in the last couple of months. For the
most part, it has been seen as a positive move, so much so that one of the regions powerhouses is
leading the change Petronas.
Petronas own Riaz Khan is the Task Group Leader and member of the new ISO 19901-9 SIMS
committee, as well as Custodian Nigel Wayne Nichols supporting the development of the standards
as well.

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

Q. How much of a priority would you consider the 1000 Year Wave for structural engineers?
5 (High Priority)
4
3
2
1 (Low Priority)

18.18
39.39
36.36
3.03
3.03

How much of a role should

metocean data play in a
structural engineers role?
45

How much of a role does

metocean data currently play
in design and maintenance
decisions?
60

40
50
35
30

40

25
30
20
15

20

10
10
5
0
%

9.09

21.21

42.42

27.27

0
%

6.06

6.06

54.55

27.27

6.06

This is certainly an interesting area, as the 1000 Year Wave is obviously a concern for most
structural engineers in the region, though metocean data is certainly not playing a strong enough
role within the design and maintenance designs.
Considering the consequences implied against the 1000 Year Wave, defenses and contingency
plans are being implemented for all assets under operation, though it is quite surprising from the
data above that metocean data is not playing a more prominent role in design and redesign
decisions.

Structural Integrity Management Summit, Asia-Pacific (10-11 September, Kuala Lumpur)

http://www.decomworld.com/structural-integrity-management-asiapac/

Introducing DecomWorlds Brownfield Development Series

Hosted by:

Structural Integrity Management Summit

Asia Pacific 2014

10-11 September, Kuala Lumpur, Malaysia

SAVE

$200

DESIGN A ROBUST STRUCTURAL INTEGRITY

MANAGEMENT (SIM) PROGRAM TO ENSURE COMMERCIAL
EFFECTIVENESS AND OPERATIONAL LONGEVITY

REGISTER BEFORE
AUGUST 15TH

Join Asias leading Structural Engineers at the regions only SIM conference, to equip
yourself with the tools and strategies to ensure long-term integrity of all your offshore assets

KEY SPEAKERS

Nigel Nicols,
Custodian Structural Integrity,
Petronas

YC Kuan,
Team Leader - Structural Integrity,
ExxonMobil

Sophia Kangan, Structural

Engineering Lead and
Technical Expert, Pertamina
Hulu Energi ONWJ

Azhari Haron,
Senior Engineer, Structural
Dialog Energy Sdn Bhd

> Learn how you can avoid common roadblocks through practical Age
Management case studies from regional and international SIM leaders including
Petronas, Pertamina and Talisman

Mohamed Daoud, Engineering

Manager (Projects Quality),
Abu Dhabi Company for Onshore
Oil Operations (ADCO)

EXPERT SPEAKERS FROM:

OPERATORS:

> Understand what online and real time data monitoring systems are entering the
market to ensure your SIM programs are being run the most time efficient manner

> Evaluate how ISO standards will impact current operations and what you should
look for to ensure your structure is not non-compliant under new design and
maintenance codes

> Review all the environmental factors which could impact the integrity of your
structure and how leading Structural professionals are compensating for the 1000
Year Wave

2014s leading Structural Integrity Conference

at a glance:

CONTRACTORS:

CONTRIBUTING PARTNERS:

Network with 150+ Senior engineers who are all taking a more proactive approach
to SIM
Enhance your understanding of SIM: 25+ business critical presentations focused on
structural health monitoring, risk based inspection assessments, environment loading,
inspection and monitoring technology, tolerable damage, and API/ISO compliance
Practical case studies from the biggest operators in the Asia-Pacific region and
the worlds leading SIM practitioners in the North Sea: Ensure your program is following
global best practice and lessons learnt for common challenges

MEDIA PARTNERS:

SPONSORS

Learn, debate and build new connections throughout the industry through premium
networking opportunities, including an online networking tool, evening drinks and round
table sessions

Join the leading Structural Integrity Experts for Two Business Critical Days of Learning, Information Sharing and
Business Development: http://www.decomworld.com/structural-integrity-management-asiapac