Saipem pursues joint ventures to gain strength in Asia
Saipem's newly acquired Maxita has been assigned construction duties on the Aquila development.
With exploration and development extending to increasingly remote areas, there have never been so many opportunities for the global offshore contractor. However, living up to that title is also becoming harder. Contractors must constantly expand through new joint ventures, acquisitions, or internal realignment.
The Italian contractor, Saipem, is a example of business internationalization. The company announced revenues for worldwide operations last year up 23% from 1995 figures. Progress in the offshore sector has advanced through a series of alliance ventures. In-house skills, meanwhile, have been merged with those of sister ENI company Snamprogetti to form a new all-round offshore engineering operation.
Although Saipem is making inroads globally, the Far East has become its powerhouse region, particularly for pipelines. The contractor's joint venture with Brown and Root, EMC, has just been selected to install a 320-km submarine gas line for CNOC's Ping Hu Field, following the Hai Nan line assignment for Arco several years ago.
- Off Myanmar, Saipem was awarded the EPIC contract for a new 350-km, 36-in. diameter line carrying gas from Total/Unocal's Yadana Field to the mainland west coast. The EMC (joint venture of Brown & Root and Saipem) Sema #1 vessel will handle the deepwater section from the platform. According to Saipem chairman and CEO Fabrizio d'Adda, the real difficulty is not the depth, but the logistics of sheltering vessels and personnel during Myanmar's monsoon period. Semac 1, however, is equipped to work in a monsoon environment.
- Saipem Malaysia is laying four lines for Petronas under Part 3 of the Peninsular Gas Utilization Project. These vary in length and diameter from 3-km, 12-in. to 266-km, 36-in.
- India, meanwhile, is becoming more attractive, now that ONGC is more welcoming to foreign oil companies. Saipem has just been contracted there to install two 48-in. diameter marine pipelines and a single point mooring system for the Essar refining crude transfer project.
- According to d'Adda, other major projects Saipem is watching include Chevron's planned pipeline from Papua New Guinea to Queensland and Vietnam's Nam Con Son gas trunkline.
- The major prize would be a possible 1,200-km line carrying natural gas from Natuna in Indonesia to Thailand. This concept was discussed by government officials in Jakarta recently during talks with potential Natuna contractors (including Saipem). An alternate solution is a pipeline to Indonesia's Aran LNG facility.
Natuna discussionsD'Adda said he detected a very positive mood among Pertamina and Exxon officials to push Natuna towards first gas by 2003, and particularly from Indonesia's technology minister, the main driving force behind the project. The 1,200-km line, if selected, would be standard pipe in standard water depths, but the sheer length would require very strong logistics support, d'Adda believes.
Another point to emerge from the discussions was that the Natuna committee is keen on a contractual strategy very similar to North Sea alliances. "We have been successful in alliances like BP's Andrew for several years," d'Adda points out. "We are ready to mobilize dreadnought units for this type of project."
Saipem has strengthened its hand in the Far East and Australasia by forming a joint venture with Clough Engineering in Perth called SaiClo. The venture is built around the recently purchased construction vessel Maxita, a dynamically positioned, 18,000-dwt ship with variable deckload capacity and a 600-ton crane.
SaiClo is investing millions of dollars into a new pipelay spread that will allow Maxita to perform J-lay of 20-in. pipe in 2,000 meters of water. The laying ramp will be cantilevered out of the vessel on the port side. Rigid and flexible lines will be accommodated, with ROV support provided onboard through Sonsub in Perth.
Three years ago, Snamprogetti completed studies for the aborted Oman-India pipeline, which would have called for a 24-in line in 3,500 meters of water. If these depths prove feasible in the future, they would likelier be the realm of Saipem's larger crane vessel S7000.
Floating productionMaxita will be working shortly on Agip's marginal Aquila oilfield in the Otranto Channel, 45 km offshore Brindisi, Italy. This is a complex, deepwater development in tough environmental conditions.
Saipem's joint venture with SBM, Firenze Producao de Petroleo, is converting a Snam oil tanker to an FPSO at the Intermare Sarda yard in Sardinia. The vessel will be moored over the Aquila reservoir in 850 meters of water, among the deepest yet attempted for ship-shaped floating production.
Aquila is this venture's first FPSO project. Saipem/SBM will lease the vessel to Agip. SBM designed the turret mooring system, plus the modifications to the vessel. The yard itself has been adapted to handle the ship, with outfitting due to be completed early next year. Saipem's newly acquired semisubmersible Scarabeo 7 will complete the wells, underlining the contractor's integrated drilling and production capability.
"FPSOs give solid cash flow," says d'Adda, "through taking on a commitment to generate production in the short term. We are now discussing the possibilities of full field management - but with care, because we don't have competence in terms of reservoir management. Our idea is to form further ventures to do this. We can easily find a partner for operations and maintenance and well management."
Drilling unitsScarabeo 7, formerly a North Sea accommodation rig, will be converted to operate in waters down to 1,700 meters and drilling to a total depth of 7,600 meters. Other Saipem deepwater semisubmersibles, Scarabeo 5 and Scarabeo 6, are currently engaged in long-term drilling contracts for Saga Petroleum.
Saga also appointed Saipem and its joint venture partner in Norway, Aker Maritime, to engineer its current Varg Field development. Varg is a Saipem-conceived platform, specifically designed for a single lift by the S7000. Hookup time is virtually zero, with just two days required to install casings and tubing. Saipem/Aker Maritime also combined recently to remove Esso Norge's redundant Odin platform, again using the S7000.
The service is headquartered in Milan, with operating centers in Houston, Kuala Lumpur and London. Special expertise will include multiphase production, boosting and transportation, subsea separation and steel catenary riser design.
- Elsewhere, Saipem's first Caspian contract was to participate in the refit of the pipelayer Israfil Guzeinov for AIOC. It is now considering co-ownership of rigs for this market with the various Caspian consortia.
- In Nigeria, Saipem is redesigning its base in Port Harcourt. All West Africa EPIC projects are handled through Saibos, its joint venture with Bouygues Offshore, which also extends to South America. In the Gulf of Mexico, Saipem's main impact so far has been in ROV alliance projects with Shell, through its Houston subsidiary, Sonsub. But the intention is for Saipem to build its own presence in this sector, possibly backed by Saibos vessels.
- The Gulf of Mexico will also be one of the markets targeted by Sasp Offshore Engineering, the new company combining the expertise of Saipem and Snamprogetti in platforms and offshore complexes, subsea and floating production systems and deepwater developments. According to Saipem's managing director Stefano Cao, "It will not be a fully fledged detail engineering company, but it will have strong capability in conceptual engineering."
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