petro-facts october 2015

7/25/2019 Petro-facts October 2015

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ctober2015

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Petrofacts October2015

4 Ourrecord ofthe companysnews,activities,newcontractsandagreementsaround theglobe

8 CountingthegainsofsandHowPetrofachas madeits inroadsintothe Algerianmarket

14 WhereweworkTherearec ausesfor celebrationontheBerantaifield, offshoreinMalaysia

16 Iamfascinatedbywhatwedo,andwhatwearecapableofdoingTimWeller,PetrofacsChief FinancialOfficer,talksprospectsand pressures

20 Inpraiseof thehumblevalveTheunsung componentwhichplays akeyrolein virtuallyallofourprojects

26 Gas:big markets,bigprojectsA graphicrepresentationof Petrofacscontributionto gassuppliesworldwide

28 SharjahkeepsgoodcompaniesMeetsomeofthebusinesseswhichmakeour workin Sharjahpossible

34 ThebigpictureTheSantuarioNorthEastfield,Mexico,wherefirstoilhasjust beenachieved

36 OpportunityisheadingdownstreamTargeted diversification hass eenPetrofacachievesuccessinrefining

40 I alwayscarryAsingleitem,carriedtoworkeachday,revealsa lotabouta person

42 DoublevisionTwogeneralmanagerscomparenotesfromopposite endsof India

44 Meetsome ofthe Petrofacpeoplearoundtheworld,astheytalkabouttheirprojects,their plans,and somemorepersonalaspects oftheir lives

GalkynyshgastreatmentplantinTurkmenistan.Photoby PhilSayer

ontributors Petrofacts

og

HelenCampbellJournalist

Helen,a languagesgraduate,writes onenergy,shippingandtechnology

LeeHoaglandPhotographer

TheFTandNewYorkTimeshavepublishedAbuDhabi-basedLee

elenunneurnalist

rten years,elenwas BankingorrespondentofeDaily Telegraph

JayDanielWrightIllustrator

JaywasborninNottingham,butcurrentlylivesinGlasgow,Scotland

Featurearti cle:Countingthegrainsof sandSeepage8Algeriais inadynamicstatetoday,saysLeilaMansour

eatures

eople

over

nside this issue

ThePetrofac editorialteamis respondingtotheoperatingenvironmentbypublishingtwoeditionsthisyear;contactpetrofacts.editorial@petrofac.comwithcommentsorcontributions.Everyemployee shouldreceivea copy;[email protected] youdliketoreceiveacopy

EditorLucyAlmond

Art DirectionEstersonAssociatesPictureEditorsMillieSimpsonAnnWhatleyLucyPinkstoneConsultantEditorPaulKeersPrintedbywww.push-print.com


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28

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44MexicoSantuarioNorthEastisineffectanew field

AlgeriaInten years

Petrofachasachievedspectaculargrowthhere

SharjahFromthishub,weship toaround25corecountriesforPetrofac

MumbaiMyown

lunchboxtravelsto theofficeeachdaybylocal train

NorthSeaThisistestamenttoourrecordofsustainedoperationsdelivery

TurkmenistanWealwayswant ourinnovationstobebe provenandcertified

PerthThisfeelsmorelikea bitowntomethanacityoftwomillion


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Log

PetrofactsOctober2015

CONTRACTRENEWALSINTHEUKUNDERPINOPERATIONSarge-scalerenewalof contractsin theUK ContinentalShelf,worth approximately$400million,servesstestamentto ourrecordof sustainedoperationsdeliveryon behalfof customers

trofacsOffshoreProjectsdOperations(OPO)sinesshas securedntractrenewals forerationsand maintenanceorkworth approximately00milliononthe UKontinentalShelf (UKCS).Thelargestof theseawards

ortheprovisionoferationsand maintenanceamsfor CNRInternationalrossitsNorthSeaassetsethree platformsin theniancomplex;Murchison;dTiffany forthenexteyears.AlsointheEastIrishSeatrofachas securedao-yearcontractrenewalmEni, coveringoperationsdmaintenanceservicesthe Douglasfixedplatforms;shorestorage installationdPointof Ayrterminal;andtyholder responsibilityforeIrish SeaPioneererationssupport vessel.Thisbuilds onPetrofacsistingportfolioofserviceovisionfor Eni,includingdutyholderoftheHewettldandassetsintheuthernNorth Sea.

tweerPetroleumin Bahrainsawardeda contracttotrofacsOffshoreProjectsdOperationsbusinesstopplya newgas dehydrationcility Petrofacsfirstprojecthe Kingdom.Thecontractcovers thestallationofa newgashydrationfacility,which isefirstina seriesof plannedscapacity projectsheduledforthenextthreeto

fiveyears.Witha capacityof500 millionstandardcubic feetofgasaday, i twi l lbeasignificantpartof Tatweerscommitment tosecure thedeliveryof naturalgasneededtomeet thegrowingdemandsofthe Kingdomof Bahrain.Atthe signing,Manivannan

Rajapathy,Deputy ManagingDirectorof PetrofacsOffshoreProjectsandOperationsbusiness,said:This award

buildson ourgrowingportfoliotrackrecordin theMiddleEast,wherewevedemonstratedourabilityto safelydeliver projectperformanceand integrity.Wenowlookforwardto

workingcloselywith TatweerPetroleumand toplaying akeyroleinthesuccessfulfuturesupplyof energyfromtheBahrainoilfield.AndrewH Kershaw,Chief

ExecutiveOfficerfor Tatweer

Petroleumadded: Installationofthenewgas processingfacilitywillbea significantmilestoneandis acriticalpieceofBahrainsfuture energystrategy.Signingthis contractisthenextbigstepforTatweerPetroleumin theimplementationofits long-termdevelopmentplanfortheBahrainoilfieldandweareallveryexcitedandproudto beabletomovethisprojectahead.

PETROFACSECURESFIRSTWININBAHRAIN

WalterThain,ManagingDirector,PetrofacOffshoreProjectsandOperations,says:Thispackageis greatnewsforthebusinessandforeveryoneinvolved.Inthe

currentclimate,morethan ever,itis vitalthatoperatorscanhaveconfidencein thesupplychainto continueto generatevaluefor them.This large-scalerenewal ofcontractsthatwe

haveheldin somecasesformorethana decade istestamentto ourrecord ofsustainedoperationsdeliveryonbehalfofourcustomersrightacrossthe UKCS.

CNRIsNinianCentralplatform,oneof theNorthSea assetsincludedin thecontractrenewalsCOURTESYOFCNRINTERNATIONAL


toredefinetheir portfoliosandreinvestcashin newerprospectselsewhere.Accordingto informationprovider1Derrick, almost$6billionof assetswerefor saleintheUK NorthSeaas atend-April 2015,with aquarteofthat valuecomingontothemarketduring thefirst quarteManyoil majorsanda rangeofsmallerindependentcompanieshave assetsonthemarket.

Thefloodof assetshascreatedsomethingof abacklog,pushing pricesdowandmakingdeals morelikelyAnewwaveofassetsaleactivityandinfluxofNorthSefirst-timerswould createnewopportunitiesfor Petrofacas

thecompanysexperiencemakesitwell-placedto winnbusiness,eitheras dutyhold(morecommonlynowservicoperator)or insupportfunctionsduringthetransitionaryphaseas NorthSeaassetschangehands.

Petrofacpi oneeredoutsourcedasset managemin1997viathecreationofthedutyholder model.Sincethewehave managed19 assettransitionsand enabledsixnentrantoperatorsin theUKC

ASSETSCHANGEHANDSINNORTHSEA

6NEWUKCSENTRANTSENABLED

19ASSETTRANSITIONSSINCE1997

Petrofacscontract tosupportthenew operatorof theSeangasfieldin theSouthernNorthSeacouldheraldawaveofsimilaropportunitiesfor thecompany,as theoil pricedownturnis leadingmajorstodivestmatureassets.

Oranje-NassauEnergie(ONE)UK LimitedtookovertheSean operatorshipinJune,followingits purchaseof 50%intheproducingfield fromShellandEssoattheendof2014.InJune,ONEawardeda$45-million,three-yeardutyholdersupportservicescontractto Petrofac,with theoptionoftwo one-year

extensions.Thecontractsupports

around40jobs(on-andoffshore)and willsee thecompany provideoperationsandmaintenanceservices totheSean facilities, located68milesoffshore,north-east ofLowestoft.In total,In total,Petrofacemploys4,000 peopleforits UKCSoperations.

Petrofachas beensupportingnew entrantsintheNorthSeasincethe1990s,whenit pioneeredthe dutyholdermodelof outsourcedassetmanagement.Thisprovedattractiveto smallerindependentoil companiesandthoseenteringtheregionforthefirst time.

Thesecontractswereoriginallyseenasa lifeoffieldoffering.But intheir matureformtheyhave sometimesactedas abridgingphase,wherecompanieswithoutoperatingequity inthe UKCS

areableto benefitfromPetrofacs procedures,processesand relationshipswithregulatorsduringtheirtransitionto fulloperatorships.PetrofacsupportedONEthroughoutits preparationsfortransferof operatorshipforSean,includingits interfacewithUK regulators.

Therecouldbe moresuchagreementson theway.ThesalebyShellandEssoof theirinterestsin Seancame asloweroilprices areleadingthe majorsJA

MIEJONES

4,000PEOPLEON-ANDOFFSHORE


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trofachas beenawardedantracttosupport

aintenancemanagementstem(MMS)implementationBumi Armadasfloating,

oduction,storageandloading(FPSO), theArmadaakenboundfor theNortha. Theseservices willberformedbyBumi ArmadapportedbyPlant Assetanagement,the asset

rformancemanagementnsultingbusinesswithintrofac.

Petrofacwas selectedcauseof theirtrack record

MMSservicesforFPSOojects.TheArmada Kraken,nvertedfroma Suezmaxice

asstanker,will bedeployedineEast ShetlandBasin.TheKrakenfieldvelopmentis oneofthe

biggestheavy-oil fieldprojectscurrentlyunderdevelopmentintheUKCSwithananticipatedproductionlifeofup to25years.

Thescopeofworkincludesdevelopmentof anintegratedrisk-basedmaintenanceprogramme,associatedrepairandreplacementstrategiesandsparesholdings.Recognisingthe potential

valueandcostsavingsto beachieved, PlantAssetManagementwill applyitssystematicmethodologytorationalisesparesholdingswiththeexpressaimofensuringeffectivecost controlwhenowning,stockingandmaintainingequipmentsparesforthelifeofthe asset.

BuildMETM,PlantAssetManagementsproprietary

assetmanagementprogramme developmentplatform willsupport theproject. Itwill provideacontrolled environmentinwhichtodeveloptheassethierarchy,assignmaintenance,conductthe criticalityassessment andsparesanalysis,andbuild billsofmaterials.

BusinessManager(Europe)

ofPlant AssetManagement,JohnMorrison,says: Wearedelightedtohave securedthiswork,which willbe executedanddeliveredby adoptingaclosepartnershipagreementwithour clientthat optimisesthecombined skillsof PlantAssetManagementand BumiArmadapersonnelin KualaLumpurto provideahighquality, costeffectivesolution.

PETROFACRECOGNISED

ORSETTINGSTANDARDINSAFETY

We aredelightedtohavesecuredthiswork,whichwillbe executedanddeliveredbyadopting aclosepartnershipagreementwith

ourclient

MANAGINGANDMAINTAININGTHEARMADAKRAKEN

Theteambehind theUZ750projectalsowon aclientsafety award

Directorof KOCPipelines,receivedtheaward fromKOCCEOHashemS. Hashem.

TheteambehindtheZADCOUpper ZakumUZ750Projectalsowon aclient awardasBest ContractorSafetyInitiatives for2014.

Theteam designed,producedanddelivereda widerangeof corporateand projectHSSEinitiativesto makesure

thatall employeesandcontractorswho areon siteareengagedandsafeatalltimes.

TheUZ750projectisa majoroffshorefielddevelopmentinthe UnitedArab Emirates.Itis located80kmoffthecoastofAbuDhabiandis beingconstructedonartificial islandsa hugeonshoreprojectthatrequiresanunusual blendofoffshoreskills.

Twosafetyawardshavebeensecuredby Petrofacfromclientsfor projectsin KuwaitandAbuDhabi.

ThecompanysKuwaitOilCompany(KOC)Pipelinesprojectteamwon theKOCCEOsHealthSafetySecurityandthe Environment(HSSE)awardfora secondconsecutiveyear.

Theawardwas presentedbyHashemS. Hashem,ChiefExecutiveOfficerof KOC.

TheKOC PipelinesProjectrecentlyclocked15.5 millionmanhours withouta lost-timeincident(LTI),andthisHSSErecognitionfor thesecondsuccessiveyearshowsthe commitmenttosafetybyeveryoneinvolvedinthe project.

ThePetrofacdelegation,whichincluded AndyNickerson,HSSE DirectorofOnshore EngineeringandConstructionbusiness unit,andMohamedShanan, Project


PetroleumDevelopmentOman

(PDO)has awarded Petrofacanengineeringandprocurementcontracttoprovideservicesfor itsYibalKhuffproject, afield locatedapproximately350 kmsouthwestof Muscatin theSultanateofOman.

Underthe termsof thefour-and-a-half-yearcontractPetrofacwill beprovidingreimbursabledetailedengineering,and constructionandcommissioningmanagementsupport services

andprocurementon an

incentivisedpass-throughbasis.Thiswill extendthroughoutconstructionandduringstart-upof theintegratedoil andsour gasfacility.

Thetotal contractvalueisexpectedto bearound$900millionwith aroundone quarterofthe revenuesrelatingtoprofessionalservices(engineering,constructionandcommissioningmanagement).

Developmentof thefield willaddtoPDOsfutureoil

productionwhilstthe

associated gaswill beutilisedforpower generationandenhancedoil recoverydevelopments.

CraigMuir,ManagingDirectorforPetrofacsEngineeringand ConsultingServicesbusiness,says: Thiscontractbuildson theRababHarweelIntegratedProjectwhichwe arealreadyexecutingalongsidePDOand representsafurthermilestoneinthedevelopmentof ourEPCmdeliverystrategy.

Itreinforcesour presence

inOmanwherewehaveanumberof projectsandengineeringoffice, andwherthiswill furthercomplementouragenda forincreasingincountryvalue. Wewill contintomaintainastrongfocusonthisaspectof ourdeliverybyaccessingthe localsupplychainand recruitment oflocaresourcesandwe areverymuchlooking forwardtogrowingandstrengtheningtteamworkingalongsidePDOtodeliver thisproject.

ENGINEERINGANDPROCUREMENTCONTRACTAWARDEDINOMAN

PETROFACAMBITIONSREWARDEDINKUWAITKuwaitis, andwillcontinuetobe, oneof ourcoremarkets,andis ofstrategicimportanceto Petrofacsambitionsinthe MiddleEast.

Petrofachas signeda contractwiththe KuwaitOil Company(KOC)fortheir manifoldgrouptrunkline(MGT)system inthenorthof Kuwait.

Thelump-sum engineering,procurementand construction(EPC)project,valued atapproximately$780 million,isintegralto KOCsplanstoincreaseandmaintaincrudeproductionoverthe nextfive

years.Threenew gatheringcentres(GCs),which formpartofthe broader project,arealreadyunderconstructionwithPetrofacexecutingtheEPCcontractforGC 29.

Due forcompletiontowardstheendof2017,theMGTsystemwill providethefeedstockto eachofthegatheringcentres viathreeindependentnetworksof

intermediatemanifoldsandpipelines.Eachof thegatheringcentreswill becapableof producingaround100,000barrelsof oilperdaytogetherwithassociatedwaterandgas.

MarwanChedid,ChiefExecutiveof PetrofacsEngineering,Construction,Operationsand Maintenancedivision,said:Wehavea long

trackrecordin Kuwaitwhichextendsoverthelast15 yeaandthe MGTawardrepreseourtwelfthprojectinthecountry.Kuwaitis, andwillcontinuetobe,oneof ourcomarketsandisof strategicimportancetoPetrofacsambitionsinthe MiddleEastWelook forwardtoworkingwithKOCtodeliverthisprojsafelyand onschedule.


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uringthe past 18yearsPetrofachas madesignificantinroads

to theAlgerianmarket,thanks toits involvement ina numberof

ajor oiland gasprojects.RobinKnight describeshowitasbeendone andwhatliesahead

ALGERIA:COUNTINGTHEGAINSOF

SANDPetrofacts October201

Locatedina remoteregionAlgerias Sahara Desert,where the terrain consistsinterlockingsanddunes, thElMerkcentralprocessingfacilityoperatesasa keyproductionhub fortheBerkineBasinregion.


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Grassrootstraining isoneofthemosteective toolsthat thecompanyhas

AdelHaddadVice President and CountryManager,Algeriasince 2009.JoinedPetrofacin 1998.Amech anical engineerbytraining,he hasworkedmainlyintheoilandgassectorinIndia, Kuwait,GeorgiaandKazakhstan.

ahamMacMillan

ce President&Director ofojectsAlgeriafor Onshoregineering& ConstructionEC).JoinedPetrofacin001as asafety studiesanager,and transferredtoojectmanagementin 2007.


Algeriaisa specialmarketwithitsownenvironmentsof risksand challenges,observesLeilaMansour,PetrofacsLegalRepresentativeand BusinessDevelopmentManager inAlgiers. Despitethis,she says,the companysspectaculargrowthsinceit openeditsfirstofficeinthecapitalin1999has madethenameofPetrofacin hercountry arespectedlabelofseriousnessone renownedfor itsabilitytodeliverhighqualityservicesontimeandtobudget.Successhas nothappenedovernight.

Thecompanywas firstestablishedinAlgeriain1999,andthefirstcontractawardedin2000 the$660millionOhanetdevelopment.But it wasnot until2007that Petrofacmade itsnextbreakthrough theawardof a$600 millionengineering,procurementandconstruction(EPC)contractto designandinstallcompressionfacilitiesat threegas-producingfieldsatthehugeIn Salahdevelopmentin thecentral Sahararegion.Sincethen, growthhasbeen impressive,

muchofit linkeddirectlyor indirectlytolargeventuresassociatedwith theAlgerianstate-owned oiland gascompanySonatrach.A furtherfour EPCcontractshavebeensecuredwithacombinedvalueexceeding$5 billion,and thecompanynowhasmorethan800staff(includingover350 expatriates)workingin thecountryat ninesites.ThreemajorEPCprojectsarestill

ongoinga $1.2billioncontractto developsoutherngasfieldsin theInSalahdevelopment(SFDP); a$ 650million jointventurewiththe Italianfirm Bonattitoextendthelifeofthe AlrargasfieldinsoutheastAlgeria;and a$970 millioncontractfora gastreatmentplantandassociatedflowlines/pipelineattheRegganebasinin theSahara1,500kmsouthwestofAlgiers.Mostrecentlythe companywona

five-yearcontractwith Sonatrachtoprovidea rangeof engineeringdesign andprocurement(EDP) servicesas wellassigninga contractforthe provisionalundertaking ofa jointventure,also for

EDPservices.Theobjectiveisto buildlocalcapability andcapacity.Theseagreementsare excellentillustrationsofourstrategyin action,saysCraigMuir,ManagingDirectorof PetrofacsEngineeringandConsultingServices(ECS)business.Theyuseourinternationalcapabilityto maximisein-countryvalue.And theysupport ourlonger-termsustainabilityin Algeria.Thesesuccesses havenot been

achievedeasily.TheIn SalahSouthernFieldsDevelopment,to giveone example,hasbeen along challengingprojectaccordingtoGrahamMacMillan, VicePresident Operationsand DirectorofProjectsAlgeriafor PetrofacsOnshoreEngineeringandConstruction(OEC)businessunit. Firstgas is scheduledforlaterthis year,withfurther expansionasadditional wellsbecome availableto behookedup.There hasbeen somedelay,heexplains,duetotheknock-oneffectoftheterroristattackattheIn Amenassiteinearly2013,whichresultedinmorethan

oneyearofstandbyas theclientandPetrofacevacuatedexpatriates.TheIn Amenasincidentapart, Algeria

hasbeenrelativelystablesincethe turnof

thecentury.Nevertheless,as Grahamstresses,Wherever wework inthe worwehavetoremainvigilantaboutthespecificsof ouroperatingenvironment.Thats justcommon sense.VedPrakashGupta,the companys

ProjectManagerat Alrar,adds:Constructionin Algeriahas haditschallengesintermsof logisticsandtheavailabilityof skilledmanpowerandqualifiedcontractors. Alraris noexceptiButwe dounderstandthe operatingenvironment.Indeed,every Petrofacprojectherehas beencompletedsuccessfully, andboth theAlrar andRegganeprojectsareprogressingwellaccordingtoAlgeria CountryManagerAdelHaddad.Resourcestocounter thechallenges

facingAfricaslargestcountry relyoverwhelminglyon thehydrocarbonsector. Oiland gasrevenuesaccount fo58%of thegovernmentsbudget,98% oAlgerias exportearningsand 28%of itsgrossdomesticproduct.Substantial

untappedoiland gasreservesdo exist,mainlyin theSahararegion, makingitlikelythatAlgeriawillcontinueto woooutsideinvestors.

PaulNicholson

DirectorEngineeringandConsultingServices(ECS)NorthAfrica.JoinedECSin2013. Some25yearsprojectandconstructionmanagement, developmentandimplementationexperiencein theonshoreandoffshoreoiland gasindustry.


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ForPetrofac, winningthe $2.3billion EPCntractforthe ElMerk centralprocessingcility(CPF) in2009 wasthe differentiatingoject,saysGrahamMac Millan.Wewonatcontractduring theglobal financialwnturn.Itensured stabilityovera periodhenour peersreally struggled.Firstoil atElMerkwas achievedin

arch,2013andthewholeprojectwasmpletedsix monthslaterin lessthanfivears.Morethan1,000kmof electricalblewaslaidandtodaytheEl MerkCPFeratesasa keyproductionhubfortherkineBasinregion.OneexplanationforPetrofacsuccessoriesinAlgeriasuchas ElMerkhasbeenecompanysfocused andsustainedveto developstronglocal relationships.heyare acutelyimportant,notesRomenah,ProjectManagerat theRegganevelopment.Paul Nicholson,DirectorCSNorth Africa,echoes thesentiment:heyarethe cornerstoneforalloursinessdevelopment andgrowth.JigneshDoshi,Project DirectorontheDP,explains:About 60% ofour labourrcecomesfromlocaltowns.Henceourationshipswith thelocal authoritiesandoplearevery important.Our biggestncernisthatonceourworkstartsperingdown,therewill notbe adequatemploymentina desertcontextlikethisforcalpeople,unless otherprojectvelopmentsfollow.

prioritybe giventoAlgeriansinrecruitment,suchinitiativeshave emphasisedthatPetrofacis inAlgeria forthe long-term.Theadventof alowoil priceerameans

thatcompetitionfor businesswill inevitablybecomemoreand morechallenging,acknowledgesAdel Haddad.Andthere isagreementamong Petrofacexecutives

that,as JigneshDoshiputsit,whiletherearetremendousopportunitiesin Algeria,aswithallourmarkets,it requirestimeandpassiontoget thingsdone.Nevertheless,with thelikelihoodof a

renewedpoliticalpushfromthetop tofurtherdevelopAlgeriasconsiderableoilandgasassets,andbringthemtomarketwithina morecompetitiveframework,plus southernEuropesongoingneedfor moregas,the overallfutureforoil andgasservicescompaniesinAlgeria appearsencouraging.Petrofac,in particular,looks wellplaced

tothrive, witha fully operationalengineeringand representativeofficeinAlgiersnow supportingacost-effectivebusinessinthefield allunderpinnedbyastrongtrackrecord.It hastakenus nearlytwodecadestolearnhowto performhere,concludesGrahamMac Millan.Inthelasttwoyearsourpeershavetriedtoenterthismarketbutarefindingit heavygoing.Algeriais notsoeasytoenterasanewcomerbut thoroughly rewardingonceyouarein.

InAlgiers LeilaMansouradds anotherperspective. InAlgeria relationshipsdevelopthe countryisin adynamicstatetoday. Severalchangescan happenduringthelifeof thesameproject.Thisis acountrywhereyou mustalwaysbeon thealertaschangecanhappenswiftly.Ontheotherhand,as relationshipsdeepen,

eachprojectcan behandled differently,andbetter,thanthe previousone.ThatsveryrewardingAnotherkeystrategyhas beento invest

ingrassrootstraining oneof themosteectivetoolsthe company hasaccordingtoAdel,andanimportantweaponinthestruggleto combatunemployment.Inlate-2010Petrofacfundedtheconstructionandoperationof acentre900kmsouthofAlgiersat HassiMessaoud,designed tohelpyounglocalsacquirethe skillstheyneedfortheoilandgasindustry.Over800individualshavegraduatedin fivetechnicaldisciplinesandthe facilityhas beenwidelypraisedatlocal andnationallevel.OtherPetrofacfundshavebeenusedto

upgradeatrainingcentreintheIn Salahtownship,builda craftcentreatElMerktoimproveskillssuch aswelding andpiping,andfacilitateEnglish languagecoursesforengineersthroughthe BritishCouncil.Also,says PaulNicholson,each memberofourengineeringteamhasafullydefinedtraininganddevelopmentplan.Given arecentlyenactedlaw whichlays downthat

VedPrakash GuptaProjectManagerAlrargasfieldproject.ElectricalEngineer bytrainingwithbackgroundin thermalandgaspowerplantsin theoilandgas industry.JoinedPetrofac2007 asDeliveryManagerforthe InSalahgasproject.

RomenShahProjectManagerforthe

Regganeprojectmanagingengineering,procurementandconstruction.Achemicalengineerbyqualification,hehas 25yearsexperienceinprojectmanagementonvarious types of projects.JoinedPetrofacin 2002.

JigneshDoshiProjectDirectorSouthern

FieldsDevelopmentProject,InSalah. JoinedPetrofac2002.A civilengineerbytraining,he workedpreviouslywith BechtelinUAE andIndia.


ProfileLeilaMansour,PetrofacLegalRepresentative,Algiers

AsthefirstAlgerianwomantoworkasan oilfieldengineerinthe AlgeriaSaharadesert,LeilaMansourclearlyhaswhatittakestosurviveandflourish.Itwas anexciting

experience,she recalls.Iwas involvedinloggingoperationson theoil wells,responsiblefor someveryexpensive andsensitiveequipmentandfor thecrew.Tospendmorethan72hourswithoutmuchsleepwasnothingexceptional.The best

momentwasgettinganinvoicerelatedto theoperationssigned bytheclientandthengoingbacktothebase office.Workingatthetimefor

Schlumberger,Leilarealisedfromtheoutsetthatthedesertworkplacewasessentiallyamasculineenvironment.ItmeantthatI avoided

askingthemenforhelpincaseitwasusedas areasontojustifytheirdelaysor losttimeintheoperation.I justhadtocarryonwithoutcomplaint.Eventuallypeopledidofferme theirhelpwhich,ofcourse,I refused!Thisunabashed,can-do

attitudehastypified Leilascareer.Born inAlgiers, shegrewup betweenAlgiersandParisbeforeattending

USTHBAlgiersUniversity,whereshe studiedelectronicengineering.Mynatureis toseeka

challenge.Atthat timetheelectronicsdisciplineat theuniversityhadthe bestrating,soit becamemychallenge.In1993shegraduatedwithhonours.JoiningSchlumbergerin

theSahara,the companysubsequentlytransferredhertoParis. Thereshe oversawthecompanysbusinesstieswiththe globalcreditinsurerCoface herfirstmoveawayfromengineering.Itwasveryexcitingtofind

oneselfdealingwith banks,andnegotiatingbestvaluedatesto allowinvestmenttobeon time,she remembers.LatershejoinedABB

LummusGlobalNetherlandandwas responsiblefor its

IntenyearsPetrofachasachievedspectaculargrowthin Algeriaandmadeitsnameknown forthehighqualityofits services.

businessinAlgeriauntilitsolditsoilandgasinterests.Andshortly after,in 2004,Petrofaccame callingwith anewchallengeto beLegaRepresentativeand SeniorBusinessDevelopmentManagerin Algiers.Leilawashappyto accept.Today,shesays, Idont ha

aspecific jobframeworkwhlimitsmy orientation.As LegRepresentativeand SeniorBusinessDevelopmentManagerImin contactwithkindsof people,fromthoseithelowestpositionstothosethehighest.Leilaexplainsthat sheis

mostlyself-taught.It pushemeto learnlegal proceduresandthebestwaytodealwittheauthorities,banks andministries,she adds.Mostofhertime,Leila

admits,isdedicatedtoher joInten yearsPetrofac hasachievedspectaculargrowtinAlgeriaandmadeits nameknownforthe highqualityofservices.Weareallproudtoworkforthiscompany.It hasbecomepartofmy life.Whathaskepther with

Petrofac,she reflects,isthetrustinvestedbytopmanagementin people.Lookingahead,she hopestobemore involvedin corporasocialresponsibilityissues.Yetmindfulthat successin

businesscan neverbe takenforgranted,characteristicalshehasanothergoalinmindInherwords:Inertiaisthemaindangerthreateningthedominantposition ofacompany.MyfocusinPetrofacinthe futurewillbetoconcentrateon avoidingthatdanger.


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PetrofactsJune2014

WHEREWEWORKJUMPFORJOY

All those who work orhaveworked ontheBerantaifield offshoreinPeninsularMalaysiahavesomethingto celebrate.Notonly hasthe assetsurpassedtheone millionmanhourmark ofsafeoffshore operationswithout al ost-timeinjury(LTI),but itwasalsoHari Merdeka orMalaysiaDay in August.Thefieldhas operated

formorethan 961dayssafely,since hittingbothfirstgasandfirstoilinlate2012andearly 2013respectively.

Thesafetyachievementalsoincludescompletionworkdone bycont ractorsandvendors.

Petrofacis operatorofthefieldandhasledthedevelopmentunder ariskservicescontract,workingalongsideits partner

SapuraKencanaPetroleum,onbehalf ofPETRONAS.Hari Merdekameans

IndependenceDay.It isanationalholidaywhichiscelebratedon31 Augusteveryyear, whenpeoplefromall backgrounds,raceandreligioncelebratetheformationofMalaysia,andits independencefromcolonialrule.Photograph byIanTeh

Petrofacts June2014


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AMFASCINATEDBY WHATWE DO ANDWHAT WEARE CAPABLEOF DOINGcompanysChief FinancialOcerknowsallabout

xpectations especiallythoseof theCity. HelenDunneeetsTimWeller to talkpressure,prospects andperformance.

hotographsby JoakimBlockstrom

s Fridaymorningattheend ofa busyeekfor PetrofacsChiefFinancial OfficermWeller.On Tuesday,the companynounceditsinterim resultsto thearket. AfterbriefingCity analysts,mhas spentthe interveningdayseetingsomeof Petrofacsinstitutionalvestorsand explainingthose resultsintail.Yesterday, forexample,he wasininburghto meeta numberofareholders,includingStandardLife,eof Petrofacslargestexternalinvestors.doverthenextthreeweeks,he willitinvestorsin London,EuropeandorthAmerica,where morethan 20%Petrofacs sharesarenow held.Itsa prettyintensiveperiod,Timncedes.Theinvestorroadshowtakestweenthreeand fourweeks.Theocessisthenrepeatedafterthefullyearsultsareunveiled. Igenerallyvisit theUS

acoupleoftimesa year,andtheresanannualEuropeanroadshow.Indeed,overthecourseof ayear,Tim,

togetherwithmembers ofhis investorrelations teamand Petrofacsexecutiveteam,will meetaround300 investors,sometwicea year.WemeetStandardLifetwoorthreetimesayear,headds.Meetinginvestorstoexplain Petrofacs

storyandhighlightitsprospectsisavitalpartof Timsrole,andone hetakesveryseriously.Quite simply,the investorsownthebusiness.Itis theirmoneythatisatrisk.Manyboughttheirsharesatthetimeof Petrofacsfloatand areloyaltothecompany.ButTimalsohastoexplainthebusiness modelandperformanceto Cityanalystswhorecommend whetherinvestorsbuy,sellor holdsharesin Petrofac.Managingtheinvestorinterfaceis a

veryimportantpart ofthe CFOsjob.Wearethepeoplewhohavetofacetheinvestorandanalystcommunity,and makesurethat theyvery clearlyunderstandourexpectationsfor thebusiness sothat theycanset realisticgoals.WhenPetrofacslippedout oftheFTSE

100indexintotheFTSE250,it didnotsufferfrom anexodusof shareholderswhichother companiesinsimilar positionshaveexperienced.Wedid notseea bigshakeout ofour existinginvestors,andactuallyour currentsecondlargestexternalinvestoracquiredtheirstake afterourexit fromthe FTSE100,says Tim,indicatingthatthe loyaltyofthe investmentcommunityreflectsan understandingofPetrofacsstrengths,suchas itsrecordbacklogand significantopportunitieswithinits coreMiddle Easternmarkets.Timadds: Afrequentmistakemade in



10/27


Ifany executiveof alistedcompanysaysthatthey dont look atthesharepriceseveraltimesonthedayofan announcement,they areprobablynottellingthe truth

executiveleadershipteam,bothon abusinessand personalbasis,and that

helps,he explains.Itis veryimportantthatwedonotseekto dressup badnews.Wehavetotellitlikeit is.Wehavetoadmitmistakes andexplainthe reasons.

Toughcall

Themost significantwarningcameinNovember 2014when Petrofachad toresetmarketexpectationsfor2015 verydramatically,says Tim.We shavedmorethan20% offearnings expectationsand,asa result,thesharepricedroppedbymorethan25% thatday.Itwasthe biggestbadnewsstoryIveeverhadtodeliver.It wasntahappy day.Theanalystscallwastough.As arepresentativeofthecompany,you feelbad forthe investorandanalystcommunitybecause youvedisappointedthem.

Ironically,there isa Citymantrathatprofitswarningsgenerallycomein threes.Itispartlydueto humannature,explainsTim.The firstwarningusually alertsinvestors thatthereis aproblem,butnobody leastof allthecompany reallybelievesitwillbe quiteas badasit seems.Thesecond warningprovidesanupdate,asthegrimrealitystartstodawn.Andthe

finalone deliversthe grislytruth.Itis importantforTim andhisteamto

keepabreastof operationaland financialperformanceacross thewhole companyiftheyaretoensurethattheCitysexpectationsreflect arealistic viewofPetrofacsprospects.Timholds frequentformaland informalmeetingswithhisteam,who haveresponsibilityforallaspectsof thecompanysfinancesincludingbusinessunit anddivisionalfinance,financialcontrol,tax, treasury,IT,internalaudit,mergersand acquisitions,andrisk, aswell asinvestorrelations.

Theyare expectedtounderstandnotjust Petrofacsb usiness but the sector inwhichit operates.Wearea majorplayerintheindustry,andmyteamandI mustunderstand thatlandscapeand howwe fitintothe broadermarketplace,he explains.Regularsenior-levelinternalmeetingsarekeyopportunitiesforTimand histeamtounderstand developmentsacrossall ofPetrofacsbusinessunits indetail. Onceagain,Timemphasisesthe needforopenness,honestyand transparencyinthis dialogueso thatPetrofacs seniorleadershipteamcan developa detailedandaccurateview ofthe companysperformanceand prospects.

vestor relationsis toseek as highauationaspossible bytelling areally

odstorywhichisnotbackedupbyality.But thatis nota sustainablesition. Hebelievesit ismoreportant toget thecompanycorrectlyued.Beingopen, honestandnsparentwith analysts andinvestors

keytothisprocess.Thegoodstoriesustbetoldalongsidethemoretrickyes,andTim hashadsomedifficult

oriesto explaininrecent months.Overthe pastyear,Petrofachasliveredthreeprofitswarnings a

sultoffallingoilprices,a difficultonomicbackground,over-ambitiousecastsfor IntegratedEnergyServicesdsome unforeseenoperationalallengessuchas theadditionalnstruction costsrelatedto ECOMsggan-Tormore project.Youdontgetalot ofsleepthenightforea majorprofitswarning,Timmits.Itiseasyto delivergoodnewstitis veryhardto deliverbadnews.

s attimessuchasthesethatationshipswith keyinvestorsandalysts comeinto play,reinforcingTimsefor regularcontact.They willhave

etandwillknowmembersofthe


and,ultimately, in thesaleofthe companytoVodafone.I likebusinessesthat create

things,explainsTim.At Petrofac,I amfascinatedbywhatwe doandwhatwearecapableofdoingandbelievewecan bereallyproudof ourfeats ofengineering.It isfundamentallyimportantto methateverybody inmy financeteamunderstandsthese thingsand reallygetstoknow ourbusiness.Timis currentlya non-executivedirector

ofG4Sand TheCarbonTrustandhas hadnon-executiveroles withbusinessessuchasBBC Worldwide andStanleyLeisure inthepast.Iseemynon-execrolesasanopportunitytoget exposuretodifferentbusinessesandmarkets,he explains.Butalsotobringvaluetoeachparticularcompanythroughmy financialexpertiseandbroadercommercialexperience.Forexample,havingworkedfor utilitycompanies,I havedevelopedanunderstandingof theinterfacebetweentheprivateand publicsector,which wasanattributeG4S werelookingfor giventhatgovernmentoutsourcingis amajorbusinessdevelopmentchannelfor thecompany,he says.Asa non-exec,I haveaveryrealresponsibilitytolookaftertheinterestsof acompanysstakeholders

Itis very importantthatwedo notseektodressup badnews.Wehave to tell it likeitis. Wehavetoadmitmistakesandexplainthereasons

inthebroadestsenseoftheword.Hebelievesnon-execdirectorscan act

asimportantchecks andbalancesforbusinesses,and claimsto havelearnalotfrombothperformingtheroleandtpeoplehe hasmetasa result.Hisownexperience hasalso renewedhisrespecforthose whoperform therole atPetrof

Shareprice

Despitethetravailsofthepast12 monthPetrofacsshareprice improvedfollowintheresultsannouncementandallbutonCityanalystnow ratesthecompany aseithera buyora hold.WasTimrelieveIfanyexecutiveofa listedcompanysaythattheydontlookatthesharepriceseveraltimeson thedayofan importantannouncement,they areprobablynot tethetruth,Timsays.Buthealsobelievesthat,if acompanysinvestorrelationsactivitiesareeffective,thepriceatwhicsharesultimatelysettleshould notcomeashock.Indeed,he suggeststhatthe toofthe analystsconferencecall, whichtaplaceon themorningofbigfinancialannouncements,providesan indicationofhowthesharesarelikelytoperform.So,Iask,whatsthe sharepricethismorning?Ihaventlooked yet,he laugh

Careeropportuni ties

Hisfocus ondetailprobablyhasa lottodo

withhis engineeringbackground.Indeed,havinggraduatedinthe subject,Timinitiallyaspiredto bean engineer,but therewerelimitedcareer opportunitiesavailable.Ofthe70studentsin myyear,fewerthan10 becameengineers,recallsTim.Therest becameinvestmentbankersoraccountants.Tim joinedKPMG asatraineeaccountant.Heshunnedinvestmentbanking becauseof itslackofa tangibleproduct,adding:It isquitehardfor myinvestmentbankingbuddiestoexplainto theirkidswhattheydoonaday-to-daybasis!Accountancyappealedbecauseof its

parallelwithengineeringfrom anumeracyperspective.I wasalreadyfinanciallyliterate,he says.Havingbecomea partnerinKPMGs InfrastructureBusiness Unit,heleftin 1997tobecomeaserialChiefFinancialOfficer,first joiningthe GranadaGroup,beforemovingto InnogyHoldings(nowRWE npower), RWEThamesWater,UnitedUtilitiesand enduringa shortperiodwithCable &WirelessWorldwide, wherehealsohadtodeliverthreeverybigprofitswarningswhichculminatedin thedepartureofa numberof seniorexecutives


11/27


INPRAISEOFTHEHUMBLE

VALVEIfyouarea fanof comicbook

characters,youmay beaware ofTheEnforcers,a fearless team

whoapplythe rules anddirect

theaction. Sowho, orwhat,isthePetrofacequivalent?At

Petrofacts, wewouldnominate

thehumblevalve that unsungcomponentessentialto every

projectthe companyhasever

designed,built, maintainedormanaged.PeterHalliday reports

Petrofacts October2015| 2


12/27

|PetrofactsOctober2015

astyourmindbackto everyplumbingueyou haveexperiencedathome.inkof theirritatinglittleniggleslikeappingtap,or ashowerthatwontstayat

eright temperature.Thinkof thebigger,oredisturbingdramas,likeanerflowingcistern, ora badlybehavingiler.Almost allof theseplumbingissuesnbetracedbacktothesamerootcausevalveof onetypeoranotherthatis not

tinginthe wayitshould.Thethingis, intheoil andgasbusiness,esameprincipleapplies.Exceptonaggerscale.Much, muchbigger.Stripit backtoitsbareessentialsand,t like your domestic plumbing system,eryoil andgasinstallationfroma

ellhead,toa processingfacility,to apeline,to arefinery ismadeupof aotleycollectionof pipeworkandvalves,thmaybe afew pressurevesselsthrownor goodmeasure.And,becauseit isthevalvesthatcontainostof themovingparts,theytendtobeemost temperamental.Theyare the

ostlikelypointsof failure.Theycan weart,they canmalfunction and,especially

heyareincorrectlyspecified,theycanmplyfailto withstandthe rigoursofdaysoiland gasbusiness.Theyrangeinsizefromtinylittleneedleves,togargantuanman-sizedgatelves.Theyrangein weightfroma fewncestomorethan30 tonnes.They

ngeinpricefroma fewcentstondredsofthousands ofdollars. And,in

anyways,itis thesevalvesthatarethealworkhorses,or TheEnforcers,of ourdustry startingandstoppingthe flow,gulatingit, sendingit inthe rightdirection,eventingit fromgoingin thewrongection, relievingpressurebuild-ups,andtingasthe lastlineofdefencewheneverngsgo awry.fyouarein anydoubtabouttheroleof

evalve,considerhowmanyof themareutinelyspecified,procured,fitted,tested,aintainedand,whennecessary,replaced.Overthecourseof 2015,accordingtotimatesfrom theMcIlvaine Company,eoilandgasindustryis settospendahopping$19billionon valves.Ofthat,0.3billionwillgoonnew valves,$6billion

lbespentonrelatedequipment,and$3lionwillbeeatenupon spareparts.Whysomuch?Well,againaccordingtocIlvaine,evena modestlysizedgasocessingplant,builtata costof50million,wouldrequire a$5 millionvestmentinvalves80% ofwhichwould

on relatively simpleon/offvalves,and

Estimated2015 industryspendon valves:

Overleaf,theGalkynyshgasplantinTurkmenistanisPetrofacslargestEPCprojecttodate.

Abovea ndright, theBerantaifieldinoffshorePeninsulaMalaysia,operatedbyPetrofaconbehalfof PETRONAS.

20% onmore sophisticatedcontrol valves.And,of course,Petrofacsown

experience bearsthis out.Take,forexample,the $1 billionRababHarweelprojectinOman,consistingof sourgasprocessingfacilities, associatedgatheringandinjectionsystems, andexportpipelines.Forthis contractalone,Petrofacspecialistsarespecifying,procuring,testinganddeliveringupwardsof 15,000different valves including14,000 manualvalves,650 actuatedvalves,300 controlvalves,and200 pressuresafetyvalves.

Thecostofmanyofthesevalvesmayberelativelymodest at,say,$250-to-$500apiece. But,dependingon theirpurpose,valvescan getvery sophisticatedveryquickly,andthe priceescalatesaccordinglyso,for example,it isnotunusualtopay morethan$300,000foralarge emergencyshutdownvalve.

ToughlifeAvalvehasa toughlife.And,asthe oilandgasindustry evolves,presentingever more

difficultand demandingconditions, itgetstougherall thetime.

Dependingon whattheyarefo randwheretheyaresited,manyvalveshavetowithstandawide rangeof demandingconditions. Theyoften haveto contendwitha highlycorrosivemix ofmaterials,fromseawateratthe lowerendof thetoxicityscale,through tothe highlypoisonous,corrosive,flammable,andexplosive propertiesof hydrogen sulphide

$9bn

,

$MSpendonvalves foronegasprocessingplant:

Valves involved on theRababHarweel project


atthe other.Theycan experiencepressuresofmorethan300bar(so,theyhaveto bearounda hundredtimestougher thanthevalvesin thetyresof yourcar).Theycanfacetemperaturesofmore than600C(whichis ator approachingthe meltingpointof manyeverydaymetalssuch aszinc,aluminiumandmagnesium).Orinanemergencydepressurisationsituationat agasplant, forexample,temperaturesmaysuddenlyplummetfrom +30Cto -100C.Thevalves controllingthe procedure needtomaintaintheir integritythroughoutitall.

Inan industrythatwont toleratesafetycompromises,has arelentlessfocus onproductionperformance,treatseven a

singledropofspiltoilas areportableincident,andhas neverbeenmore costconscious,evermore expectationisloadedontothelotof thehumblevalve.

Misbehavingvalve

Itis generallytrueto say,justlikethosedomesticplumbingproblems,in anyoil

andgas incident,a misbehavingvalve willbeatthe rootof manyissues orwillhavefailedto prevent them.Letstakethe mostnotorious caseimaginable,the DeepwaterHorizonoilspill .Here,thecauseoftheaccidentwastracedbacktotheconspicuousfailureof eightdifferentsafetysystems threeof whichwerevalvesor valvecontrolsystems.

Consideralsothat, in theUSlegalindustry,there isa dedicatedclassofattorneyscalled valvefailureinjurylawyers.They earntheir moneybyrepresentingoil andgas workers whohavebeenhurtina valvefailure andthefactthatthey evenexistspeaks volumesabout

theprevalenceof suchincidents.So,clearly,in anyasset integritycampaign, andin everystatutorytestingregime,valvesarealways aprime focus.But,remember,thejobofa valveis notjusttostopthingsfromgoingwrong.Itis alsoaboutenablingthingstogoright.Awholeclassof valves,the so-calledcontrol

valves,arethere toregulatethe flowthrougheveryfacetofan oilandgasfacility.They thereforehave adirect impontheperformanceof thatfacility.And,tachievethe optimumperformance,all othedifferentvalves needto becorrectlyspecified,sized,situatedand safeguard

Inrecent years,thequestion ofvalvequalityhas edgedup thePetrofacagendThefactis,thecompanyhadbeguntosufferfrom qualityand integrityissuesnothingonthescaleof amajorincidentbutan on-goingseriesof nigglingissueslikeleakagethroughvalve casings,or thsheeringofvalvestems,allofwhichweradding tocosts andcausing delays.

Theissues becameso prevalentthatvalveintegritybecamea regularagendaitemof thecompanyssix-monthlymanagementreviewmeetings,and ateaofquality specialists,under theleadershofDr AndrewThomas,QualityDirectorwithOnshoreEngineeringandConstruction,was chargedwithfinding


13/27

| Petrofacts October2015

lution.A supplierqualitymanagementstemanda bi-monthlyvendor forum

ereput inplace, bringingcloserrtnershipswith themajor valveppliers,a morescrupulousregime of

onitoringand testing,anda systematicayof capturingandreportingon any

atedqualityconcerns.Thismaysoundsimpleintheory,but thealitycan bemore complex.Thevalvedustryis unusuallyfragmented,withndredsofdifferentsuppliers using

ousandsof different sub-contractors.vena highlyreputablesupplierwith veryphisticatedvalvedesignsmay outsourcemeofitsmanufacturingtoa thirdparty,

dthatswhere qualityissues canmetimescreepin, explainsAndrew.

ualityinitiativeotherperspectivecomesfrom Richard

ng,Vice PresidentofEngineeringandegrityAssuranceatEngineeringand

onsultingServices.He says:Issueswith

valvequalitycantakeawhiletocometolight.Oftenthepurchaserisnotthe enduser,which meansthe manufacturermayneverget thefeedbackunless somethinggoesseriouslywrong.

Althoughsomeissuesdo continuetosurface,andnotalltheinformationisalwayspassedbackdowntheline,thequalityinitiativehas beena definitesuccess somuchso thatvalvequalityisno longera regularagendaitematmanagementmeetings.

Whenitcomestoactuallyoperatinganoilandgasfacility,it isdifficult tooverstatetherole thatvalveswill play. Practicallyeveryoperationwe everundertake

involvesa valvein someform oranother,explainsRoyArmishaw,Vice PresidentofOperationsin AsiaPacific,who overseasallof thecompanyscurrentoperationsinMalaysiaandThailand.They arethe focusofour testingandcertificationregimes.Theyarethesubjectof ourupgradecampaigns.Andthey arethe mainreason

whywe wouldimplementa shutdown.Anadded considerationis thatRoy and

histeamsrarelygettooperatea shinynewplant.Instead,theyoften inheritan ageingfacility;theirjobis tonurseitbacktofullproduction.The symptomsyou facein anoldplantareexactlythesameasthoseyouwouldfacein anoldhouse.Theplumbingis pastits prime.Youtake thingscautiously.And youprepareyourselfforthefactthatanystopcockor theoilandgasequivalent mayfailjustwhenyouneeditthemost.

Hethereforeimploresall designerstothinkthroughthe everyday realitiesofoperatinga plant.Youcan neverhavetoo

manyvalves.We areforeverhavingtoisolateasectionofplant.Anditsanabsolutepainifthedesignerhasgivenyoutoofewvalvestoworkwithorif theyareinthewrong place.

YetanotherperspectivecomesfromValveEngineerJohn Fowler,who isbasedinthe AberdeenOfficesof Offshore

Learningaboutvalvesat theINSTEPtrainingacademyinMalaysia,oneof twotrainingfacilitiesthatPetrofacbuilttosupportPETRONAS workforce.


ProjectsandOperations,and managestheBPisolation valvescontract.Simplyput,thismeansthat,foritsNorthSeaoperations,BP hasoutsourceditson-goingvalverequirementstoJohn andhissix-strongteam.On anannual basis,theywill specify,procureandtest around1,000differentvalveson behalfof BP.Andthisgivesthemarareinsightintotheinnerworkingsof thevalve business.

Thebig issueis timing,explainsJohn.Thesearenttypically off-the-shelfitems.Theytendto beone-offs.Sowe areoftenlookingat 50-weekleadtimes. Theproblemsarisewhen a bespoke valveisneededquickly.Then,instead ofcarefullyselectingand negotiatingwith therightmanufacturer,you suddenlyfind yourselfatthemercyofa thirdpartyvendor.

Theymayhavea similarvalvein stock,whichtheyarewillingtosellyoufor100,000.But it needsto bemodified,whichmay costanother50,000.So,insteadof gettinga custom-madevalve for80,000,you endup payingalmosttwice

asmuchforsomethingthatsnottothepreferredor optimumspecification.

Consequentlya bigpart ofJohnsroleisto workverycloselywithBP,understandingand advisingonvalvespecifications,keepingon topofmaintenanceschedules, planningwellaheadfor anyshutdowns,carryingajudiciou s stockof themostfrequentlyuseditems,anddoingafull qualityinspectiononeverysingleitem theyhandle.

Havingacquiredmorethan 4,000valves,andtrackedthedetailsof eachothem,the teamhas excellentrelationshiwiththe manufacturersand suppliers,aarekeento sharetheirinsightswiththegreater Petrofacorganisation.Valvesawhatwe do.Itsourbreadandbutter.SoanyoneinPetrofacever hasany valve-relatedquestions,wecan usuallyhelp,saysJohn.

3DprintingAlthoughvalveshave beenaroundforaslongastheoil andgasindustryitself,andstillcontinuetofulfilthesamebasicfunctions,theydo keepon evolving.Allof theleading manufacturerspridethemselvesontheir spiritof innovation.InfactPentair,oneofthelargestmanufacturers,claims tofile around60relatedpatentsevery year.

Forexample,onehot topicin todaysvalveindustryis thepotentialfor 3Dprinting.Theoretically,thisoffers hugepromise. Highlycomplexdesignsbecom

easierto manufacture.Short runsofone-offitemsbecome cost-effectivetoproduce.Goodscanalsobe madewhetheyare needed,insteadof wherelaboucostshappentobe low.And oneofthelargervalvemanufacturers,GE Oil& Gahasannouncedthatit isalreadyusing3printingtoproduce controlvalveparts wspecialconfigurations.

Evenso,there isan understandableindustryreluctanceto adoptcompletelynewor novelmanufacturingtechniquesAsRoyArmishawputsit,Wedo likeinnovation,but wealwayswant ourinnovationsto beprovenand certified.Inour situation,tried-and-testedis goo

Withsoverymanyvalvesbeingproduced,whichfulfilsucha criticalroleawide rangeof judicious,incrementalinnovationscontinuesto takehold.Throughitssupplier qualitymanagemeprogramme,Petrofachasstruck upa gorelationshipwith amanufacturercalledEmersonProcessManagement.

RobertHechinger,thecompanysWorldwideQuality Director,providesausefulanalogy:Comparea 1964FordMustangwith abrand newFordMustan

Theybothdo exactlythesamethinganfromthe outside,theylook quitesimilar.But,belowthesurfaceitis atotallydifferentcar itis morereliable,morecomfortable,more economical,andmucmuchsafer.

Itmaysoundstrangeto sayso,butvalvesareevolving inmuch thesame w

Theeffluentwaterand centralseawaterinjectionfacilityinKuwait,a projectforthe KuwaitOilCompany(KOC).

Numberof valves acquiredforBP NorthSeaoperations:

4,000Temperature at whichavalve may have to operate:

600CPressure(bars) whicha valvemayhaveto withstand:

00


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|PetrofactsMarch2015

89

TurkmenistanandKazakhstan2.5%oftotalworldproductionofgas

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ETROFACROJECTS

Petrofacts March2015

ialay

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40''gas pipelineEPC

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BIGMARKETSBIGPROJECTSForecastingagencieshavebeenpredictinga glob

ageof gasformany years.Technology, market

forcesandpolicyareall atplay.Developmentssuch

asthe NorthAmericanshalegas revolution,LNG

regionaltradedealsandtheroleofgasasa

transitionfuel todecarbonisationhaveall playeda

majorrolein positioninggas asthe fuelof thefuture

Accordingto the BP Statistical Review,natural

gasisexpectedtocatchupwithoilandcoaland

emergeasthe mainhydrocarboncomponentofa

moresustainableenergymix overthe next20 year

Itis thefastest-growingfossilfuel, mainlyusedfor

powergeneration,but alsoin homes,offices,shops

andothercommerciallocationsforheatingandcooling, andas araw materialin theproductionof

fertilizerand otherchemicals.

Despitepressureson theindustrytoday

withgas pricesdownandcapitalinvestmentunder

pressure longer-termtrendsstill pointtothe

increasingsignificanceofnaturalgas inthe energy

mix.Over thepastdecade, theworldhas consume

around30trillioncubic metresofgas but reserve

todayare30 trillioncubicmetresmorethan they

werein2004.

GAS


15/27

|Petrofacts October2015

sall aboutdeliveringthe serviceourstomerswant.We listen,we diversify,weliverand,most importantly,we care.Itsearthat SalimKhoury,SeniorManagerperationsfor oneof Petrofacson-siteterers,Abela& Co,isbrimmingwithdefor thecompanythathesbeenwithr25years.nPetrofacs TowerOne cafeteria, helsits story.Abela&Co beganitsjourneyhe UnitedArab Emiratesin 1967,beforeecountrywasformedin itscurrentguise.eywereknown asthe Trucial Statesckthen,hesays.SadlyMr Abelaisnongerwithus,but theethosof hisfamilysinessstillexists today.Salimtalksaboutarecentstaffsurveyhere89% ofthosesurveyedsaidtheyjoyedworkingforthe business.

OurCEOknowsthenamesof everyoneworkingherewhichis morethan3,000people andheis alsointerestedinhowwe arealldoing.Thatsgreatleadershipinmy book.Everyperson isempoweredto makedecisionsthat impactoursuccess,whichbreedsa senseofbelonging,he adds.Forsure weenjoyourtriumphsbutwe alsoreflect,andreact,whenthingsdontgothewaywewantthem to.Salims energyandpace arewell-known

evenmoresothanusual today.Its acrazyday,he explains.Weve justwonbackacontract,soI haveto gotoJebelAlitodealwiththesetup. Dependingon themoon,it couldbethelastdayofRamadansotrafficwillbe crazierthanever,andImtryingto geteverythingin orderbeforemy

summerholiday.Hiswife andthreechildrenarealreadyin Lebanon escapingtheblisteringUAE heat,and itsclear heslookingforwardto joiningthem.Beforeleaving,Salimiskeentopointout

howthewholeAbela&Co teamplaytheirpartin keepingPetrofacsworkforcefedandwatered.I onlyvisitoncea week,sosuccessisreallydownto theguysontheground.Since wewere awardedthecontractin 2008,we havemadegoodprogress:allourfoodis preparedin oneofourtwocentralkitchensinDubaiandtransportedtoourcustomersquitealogisticsoperation.Lookingathis watch,Salimrattlesoff

somemore statistics:at Petrofac,8,000mealsa monthareserved, thats96,000mealsa year;in theUAE,Abela&Co

SHARJAHKEEPSGOODCOMPANIESetrofacemploysmore than6,000peoplein theUAE;000of thosein Sharjah alone.But itdoesnt stop there.

any companies acrossthe UAE are involvedin keeping

ewheelsturning locally-owned,locally-managedr internationalcompaniesbasedin the region.

ayeKrause-Whiteingmeets thepeopleinside thesupply

hainecosystem.Photographsby LeeHoagland

OODFORHOUGHT

orsurewe enjoyouriumphsbut wealsoreflect,ndreact,whenthings dontothewaywewantthemto.

alimKhoury, Abela &Co


PRINTSAMONGMENAsfor themost interestingjob, its probablythebusinesscards. Lastyearweprinted around140,000.

Thats a lotof networking.EliasKhoriaty,PioneerPrintingPress


16/27


rvesmorethan 120,000meals adayhichtranslatesto over43 millionmealsear.As Napoleonwouldputit, anarmy

archingonits stomach.When pressedoutthemostpopulardishtheyserve,limlaughs.Without adoubt, itschickenyani,requestedbyevery nationality!

an highlyrecommendit,hesays.Withjust0.002%ofAbela& Cossinesscomingfrom Petrofac,Salimpressesthateverycustomer isportant tothem, regardlessof size.Andthan exuberantwave, hedisappearsoutthefrontdoorsintothefiercesunshinedon tohis nextappointment.

oomserviceeratiobetween expatriatesand localsheUAE isoneof thehighestinthe worldt around80/20 andnotallnewcomers

anagetosort outtheir accommodationforetheyarrive. Petrofacsemployees

eno exception,so havingarrangementsthhotelsiscriticaltosmoothrunningforwarrivals.Oneofthosehotelsis theGoldenTulip

otel overlookingthe KhalidLagoonandMajaz Waterfront justa stonesthrow

mPetrofacsoffice. Asan apart-hotel,eare anideal property,says Alexherfan,OperationsManager there.

Wehave264 unitsfromstudiostosuites,short- andlong-stays,singleresidents

family groups. Atypical Petrofacstay isounda month.Alextakesthe Petrofacaccount veryriously. Didyou know12,000bed

ghtswereused bynew employeesin14alone?Andinthefirstsixmonthsofsyear,we arerunningclose to7,000.atamountsto revenuerunningintolionsof Dirhams.So yes,Petrofacisimportantclient. Thehospitality

industrycan beprettycut-throat,and weworkhard inorder tostay competitive.

Keepingnewarrivalshappy cantalwaysbeeasy?Surehesmiles,itgoeswiththeterritory. Thebiggestchallenge isensuringthatwegiveourguestswhattheywant,andwithintheconfinesofwhatworkscommerciallyfor usas abusiness.

ManyPetrofacguestsstay forweeks atatime,andtheirstayisthebackdropfortheirfirst impressionsabout theUAE.Weoffera guidinghandinthatinitialperiod,saysAlex.Ourteam takethatresponsibilityvery seriously.Its oftenthesimplethingsthat makethebigdierences,likeimprovinginternetaccess andthenumberof TVchannels available.We havearelationshipbuilt onrespect andtrust.Thatsimportantto me,truly,andis theethosof theentire GoldenTulipbrand.

Hiseyeslightup whenaskedaboutanyfunnystoriesfrom hiswork inhospitality.Icould probably writea book,helaughs,butheis thenquickto pointout thatconfidentialityis themostprizedpossessioninhistrade,andrefusestonamenames.Wedidhaveoneindividualwho thoughttheirbedroomwas haunted,hesays.

Naturally,theywere movedintoanotherroomand welooked intothe claims...

MorningrushSittinginlandfromthehustleofDubaiisMeydan,wellknown forits horseracingandhometotherichestracedayin theworld andalsowhereDHLhas locateditsbrand newfacility.

Wehad outgrownour previousspaceinDubaiAirportsTerminal2, saysRyanHunter,Vice President ofCommercial,anda realbonusforour driversaretheindoor,air-conditionedloadingbayshere.Withthe UAEssummertemperatures

reachingthemid-high forties,thisis nottobe underestimated.

Walkingaroundtheir coolloadingbaymid-morning,the parcelconveyorbelt issilentas theearlymorningrushhasalreadypassed.Notfor longthoughlaughsFadiAbu Touq,NationalCustomerManagerEngineering& Manufacturing.Comefouroclock,itwillbe ahiveofactivityagainas allthevanscomeinfortheevening deliveries.

Sowhatisa typicalparcel?Well, it snotwhatyou probablythink,saysRyan. Themostcommontype ofshipmentPetrofacsendsthroughDHLiselectricalandengineeringequipmentdestinedforprojectsites.Documents,whilealargepartoftheload,are secondary.From thishub, weshiptoaround 25 corecountriesfor Petrofac.

Butitcantgo smoothlyallof thetime,andthe morechallengingaspectsofPetrofacsbusiness,Ryan andFadiagree,arethe criticalityandtime sensitivityofallits shipments.

Withthe companycelebrating25 yearsofbusinesswithPetrofacintheMiddleEastthisyear,bothmen areproudof thelongrelationshipthathas beenestablished

withthebusiness,andRyaniskeentoadd:Nocustomeristoolargeortoosmallforus andthat verymuch includesPetrofac.

PressonAreturndrivefromMeydantoSharjahfindsanothercompany meetingPetrofacsneeds.Thistimeitsintheheartof theindustrialarea,ajourneynotforthefaint-hearted.Tankersqueuing toaccessSharjahMunicipalityssewageworksclogupalmosteveryinchof thejam-packedroad.Hundredsof businessesarehere,includingPioneerPrintingPress.

Pioneerspremisesarein contrast to

GUARDOFHONOUReingincludedis amajoronsiderationfor ourguys,articularlythosewehaveaced inclientlocations.avidStockton,G4S


IN-FLIGHTSERVICEWehavebeenhandlingthecompanystravelformorethan tenyears;andthenumbersspeakfor themselvesKhalidAlSerkal,EmiratesAirline


17/27


HLs stateof theart facility. Herethesidualaromaof solvents,andtheashesof ink,give someindicationofe30yearsofhistoryin thebuilding.Operatingin theEmiratesince 1982,oneeris a family-runbusiness whichwasughtby GeneralManagerElias Khoriatydhiscousinin1997.Westartedwithewarehouseand todaywe havefive,assays,smiling.Hesnota manforstandingstill ,andis atmeon theshop-floorsurroundedby hisanyprintingpresses.He pausesfrommetotimetopassonadvice,examineantjob oraskhowoneof hisemployeesoing.Ithink themost challengingjobwevenefor Petrofacwas theproductionofmepipinginspection handbooks,heys.Wehadtouse adurablepaperhichwouldntdeterioratewhenused inefield.Thatcausedusa fewproblems.Asforthe mostinterestingjob,itsobablythe businesscardswe producecross allpositions inthe company.Itsscinating.Last yearwe printedaround0,000business cards.Thatsa lotoftworking,he laughs.

eypersonnelckontothehighwayto Dubaiand intoaazeofroadsto theAl Quozindustrialarea.isisthemainUAEcentreforsecuritympanyG4S,fromwherethe localCEOvidStocktonoversees12,000people.Petrofachas 200G4S contractorsorkinginitsoffices.Wefieldteamsofallesto ourcustomers,explainsDavid.

Whatwe prideourselvesonfirstandemostis addingsignificantvalue toerydaylife whereverweare working.With42accommodationsitesin arietyofUAE locations,andalmost 100%

ofthe workforcebeing expatriateandsingle-status,howdo theymanagethis?ItsatopicthatstrikesachordwithDavid.Iam passionateaboutthe welfareofour

people:we have39 nationalitiesfrom allsortsof backgroundsliving inmore than40accommodationsites,he explains.Howeveryoneintegratescanthrow upchallengesof course,butwe allworkhardatit.Allnew joinersparticipateinacomprehensiveinduction programme.Andof course,thereis specialisedtrainingdependingonthe natureof thecompanytheyaregoingto beworkingfor.Beingincluded isa majorconsideration

forourguys,particularlythosewehaveplacedin clientlocations;the mannedsecurityand facilitiespersonnelwe haveworkingforPetrofacgenuinelyfeel partoftheculture. Sinceour relationshipbegan in2004,theresbeenvery littlechurn ofpeoplewe haveplaced.And thatspeaksvolumesabouttheworkplaceenvironment.

International carrierAfew dayslaterits theenormouscorporateheadquartersof EmiratesAirlineswhich loomslarge.The worlds

biggestinternationalcarrier,it isalso theairlinewhich fliesthousandsof Petrofacsemployees aroundthe worldfor bothbusinessand pleasure.Itis animpressivefacility:twohuge

buildings,its ownmetrostation,and alargeatriumbathedin sunshineandfullofshops,restaurantsand otherconveniences.Andat10 oclockin themorning,theplaceis absolutelybuzzing.Butthen, asKhalid AlSerkal,District

Managerfor Sharjahandthe NorthernEmiratessays,Theairportis 24/7,so ourHQnever sleepseither.Itsour maincentreinthe UAEsomost

ofour 84,000employees areeitherbasedhere orpassingthrough. Itsa greatfacility,dont youthink?Heis quickto praiseEmiratesasa

greatemployerandbrand. Butnot foronemomentdoanyof uslosesightoftheimportanceof ourcustomers,hesays,seriously.Sohow doesPetrofac fitinto Khalids

clientportfolio?It isrewardingtoserve allourloyalclients,and Petrofacis oneofthem,he says.Wehavebeen handlingthecompanystravelfor morethanten years;ourbusinessrelationshipisexcellentandthenumbersspeak forthemselves.During2014,almost 10,000Emirates

ticketswereissued andused byPetrofacsSharjahoffice withmostfrequentvisitstoChennai,London andShanghai.Khalidis amanwhohas allthefactsat

hisfingertips.Ive beenwith Emiratesfor15years,andhadthe opportunitytoliveandworkina numberofcountries,hesays.Such experiencesare enriching;dealingwith different environmentsandcultures.It keepsyour mindopen.AndwithEmirates,there isalways

somethingnewto learn.I liketothinkthat

helpsme addvalueto theclientsthatIworkwith.Onthatnote,our timewasupandwitha

heartyhandshakeanda promiseof coffeesoon,Khaliddisappearedinto thethrongoftheatrium.Aftermakingthe shortjourneyfrom

Dubaiback toPetrofacs SharjahHQ,itspleasingtosee theG4S guysstewardingvehiclesatthefrontofthebuildings,threeofwhicharefromDHL,PioneerandTheGoldenTulip.The onlything missingfromtheframeisanEmiratesplaneflyingoverhead,but youwouldnthave towaitlongtoseeoneof those

HOME AWAYROMHOMEfcoursePetrofacan importantclient.hehospitality industryanbe prettycut-throatoweworkhardtoay competitive.lexCherfan,olden TulipHotel


COOLDELIVERY

Themostcommontype ofshipmentis electricalandengineeringequipmentdestinedfor project sites.RyanHunter,DHL


18/27

|Petrofacts February2014

BIGPICTURESANTUARIONORTHEAST

Petrofacts February2014

Followingmorethantwoyearsof hard work,thePetrofacMexicoteamachieveda milestoneinJuly,indeliveringfirst oilfrom theSantuarioNorthEast fieldinTabasco,southern Mexico.Thedevelopmentwasfirstidentifiedbythetechnicalteaminearly 2013and

drillingcommencedlaterthatyear.ThefirstwelldrilledSantuario401 wastestedandfoundto be100%oilbearingwithcombinedflowratesofmore than2,500barrelsofoil perday.Threefurtherappraisalwellswere drilled andfoundtobe oilbearing,all ofwhich

weresubs equentlycompletedas developmentwells. Testingdemonstratedthattheexistingin-fieldpipelineswould,aftersignificantrepair,becapableofsafelycarryingtheadditionalfluids.SantuarioNorthEast isineffectanewfielddiscovered

ina matureproducingenvironmentandisourclientPEMEXslargestonshorediscoveryinthelastfiveyears.Theinitialfocusison safeproductiobuttheteam islookingathowfurthervaluecanbecreatedinfuture.PhotographbyMartin Varg


19/27


OPPORTUNITYSHEADINGDOWNSTREAMargeteddiversificationmakes soundbusinesssense,

ndin recentyears, Petrofachasmadestridesinto

edownstreamsector, with successin refining.etrofacts looks athow thestrategyis playing out


Asever,the AnnualReportandAccountsisa signpost:in hisforeword,GroupCEOAymanAsfarisaid thatthe companywassuccessfullycontinuingits businessmodeldiversification.In particular,he reportedthatthe Engineering,Construction,

Operationsand Maintenance(ECOM)businesshad movedfurtherdownstream,withsomenotablesuccessesintherefiningsector,andthe potential tomakeasimilar moveintopetrochemicals.Of course,this typeof diversification

makessoundstrategicsense, particularlyina loweroil priceenvironmentwhen,often,refiningcan becomemoreprofitable.It alsohelps that,in severalofPetrofacscoreMiddle Easternmarkets, manyof thenationaloilcompanies areactivelyinvestingintheir refiningcapacity.Buthow doesa companylikePetrofac

actuallymakethemoves?Itsalong,slowjourney, which we take step-by-step, saysChristopherMcDonald, ExecutiveVicePresident ofECOM, responsibleforbusinessdevelopment.Thestrategyissimple.Wepartner withcompanieswhohavecomplementaryexperience.And,bitbybit,we buildour owncredentials.Inthe MiddleEast,for example,Petrofac

knowsthe clients,it knowsthe contractors,anditknowshowtodeliverlarge,demandingprojectsin aswelteringdesertclimate.So,it makessensefor Petrofactotie-upwith othercompanieswho have

deepexperienceof deliveringrefineryprojects,but norecordof workingintheMiddleEast. Thatway,the differententitiescanpursueaprojectthatneitherwouldbeconsideredforon theirindividualmerits.Andthewholebecomesfargreaterthanthesumof theindividualparts.Thisapproachbeganseveral yearsago.

Thereweresome disappointmentsalongthewaybutin 2015,itgainedrealtraction.Withincrementalprogress,successfirst

camein December2012, whenPetrofacwasawardedtwo engineering,procurementand construction(EPC)packages, valuedat $1.4billion, forSaudi

AramcosJazan Refineryand Terminalproject.Bestdescribed asa tankfarm,thisassignmentplayedto Petrofacsexistingexperience,so therewas noneetoenlist aco-venturepartner.But itgavePetrofacan all-importantfoot-in-the-do

intothe refiningsector.And,with astronemphasisonemploying anddevelopingSaudinationals,it reaffirmedthecompanys commitment tolocal deliver

Big breakthroughNext, in November2013,camethe bigbreakthrough:a $2.1billionrefineryimprovementprojectfor OmanOilRefineriesandPetroleumIndustriesCompany(ORPIC),awardedon a50/50joint-venture basis to Petrofac andKorea-basedDaelim IndustrialCoLtd.Oneofthe largestoiland gasengineeri

procurementand constructiondealsevawardedin Oman,this contractincludeanupgradeofan existingfacility,plusthadditionofnewrefiningunits,whichwillthetotalcapacityof theSoharRefinerymorethan 70%.Theprojectismovingonapace.By A

2015,the teamwas celebratingmore thfivemillionmanhourswithouta singlelotimeincident (LTI).During thesummermonths,theconstructionphase hadcommenced.Andeverythingis ontracktomeet thebruising 36-monthscheduleAnothermajorlandmarkcame in

February2014.Leadinga three-wayjoint-venture involving Korea-basedSamsungEngineeringCo Ltdand CB&NederlandBV,Petrofacreceivedawardnotification forKuwaitNational PetroleuCompanys(KNPC) CleanFuels ProjecMinaAbdulla (MAB1)refinery.Locatedinsouthern Kuwait,the

totalvalueofthe contractis$3.7billion.Thescopeofthelumpsumengineeringprocurementand constructioncontracincludestheprovisionof 19newrefiningunitsat MinaAbdulla(some50kmfromKuwaitCity),the upgradeof fiveexistingunitsat Shuaiba(10kmfurthersouth),an

Belowandleft,construction workcontinuesapaceontheSoharRefineryimprovementprojectinOman


20/27


companyinginter-refinerytransferlines.Itisa largelygreenfieldandpartlyownfieldproject, saysprojectdirectorupDasgupta.Anditis afirstforKNPC,ew refineryprojectto internationalandards,which willbring abig increaseto

eexistingcapacity yetbe morevironmentallyfriendly.

efiningcredentials

August2014,justsixmonthsaftertheNPCwin, Petrofacwas ableto celebratetanotherrefining success:a sizablegineering,procurement,constructiondcommissioningcontractfor arefineryckageinthenewRefineryandtrochemicalsIntegratedDevelopmentAPID)projectin Johor,Malaysia.Awardedby PRPCRefinery andCrackernBhd,asubsidiaryofPETRONAS,thismpetitivelytenderedcontract isvaluedmorethan$500million.Itincludesthreephurrecoveryunits, twoaminegenerationunits,two sourwater strippingits,a liquidsulphurstorageunit,andaphursolidificationpackageunit. And,asellas addingto Petrofacsrefiningedentials,it isalso thecompanysfirstajoronshoreprojectin Malaysia.So,movingon fromthese initialccesses,how aboutfuture prospects?espiteuncertaintyover thefutureofitabilityof refining,andover-capacityrossthe globalmarket,manyoperators

econtinuingto invest,particularlyin theddleEast.Asa recentMcKinseyreporttsit:MajorcrudeexportersintheMiddlestcontinueto addto refiningcapacity,otivatedby anumber offactors.First,suringsecurityof domesticsupplymainsa toppoliticalprioritySecond,ddleEast playersaremotivatedbyaintainingtheir competitivenessin theobalcrude markets.Consequently,Petrofacis seeingaalthypipelineof futureopportunities.d,dependingon theproject, thempanyisgettingto thestagewhereitnpursue opportunitiesand achieve

pre-qualificationin itsown right.AcrosstheMiddleEast,thereisalsoa

tendencyfor newrefineryprojects tobecloselyintegratedintopetrochemicalprojects.And,by followingthesamestrategyas inrefining,Petrofacis keen

todevelopits credentialsin thisrelatedfield.We arein petrochemicalsnowwherewe werein refiningafewyearsago,explainsChristopher.You couldsaywearea coupleof yearsintoa ten-yearjourney.

Eventhoughthereis ahealthymarketoutthere,Petrofacneedstobeverydisciplinedinits biddingbehaviour.Wecant andwe wontgo aftereverything,hesays. Biddingis anexpensivebusiness.Asinglebidmaycostus US$12or13 million.Soweneedto gothrougha rigorousscreeningprocess.Realistically,c anwewin?Canwewin andmakemoney?And,if so,whatsour differentiator?But,whenitcomesdowntoit,whats

actuallydifferentabouta refiningorapetrochemicalsproject?In fact,all ofthecomponentsare quitesimilar,saysPaoloBonucci,Vice Presidentandheadof onshorebusinessdevelopmentatECOM.Justlikeanyotheroilandgasfacility,a

refineryor a petrochemicalsplant ismadeupof piping,machinery, pressurevesselsandvalves.The difference isthat,traditionally,Petrofac hasworkedon what

I wouldcall horizontalprojects.They arespreadacrossa largearea.Youhave theluxuryof space.Sodesignsdontneedtobeparticularly complicated.Bycontrast,a refineryaswellas a

petrochemicalproject isa verticalproject.Everythingissqueezedinto asmaller area.Sothedesignsandthe pipeworkbecomethatmuch morecomplex.Thecoreskillsarethesame.But

youneed somereferenceprojectstoshowthatyou canadaptthemto thedownstreammarket.We arenow atthatstagein refining,andwe areheadingintheexactsamedirection forpetrochemicals.

EverythingisontrackonOmansSoharRefineryimprovementprojectto meetthebruising36-monthschedule


We areinpetrochemicalsnow wherewe

were in refininga few years ago.

You could saywe are a coupleofyearsintoaten-yearjourney


21/27

|Petrofacts June2014 Petrofacts June2014

Ifyouhavean itemwhichyoutaketoworkeveryday,whichsayssomethingaboutyouandyour work,let us know, [email protected]

I ALWAYSCARRYMYTIFFINTIN

SaiN Acharyais thepipingdeputy

leadengineerbased inMumbai,

wherelunchtime istaken seriously.Indianlunchboxes,calledtins or

dhabbas,come inall shapesand

sizes. Here,Sai tellsus abouthis

owntin tinrituals.Photographby AtulLoke

Theflavour ofhome-cookedfoodisunique.Mineispreparedbymy wife:Ipreferlessspicyfoodandsheknowsmytasteverywell.Everyday,I eatsteamedrice,roti, sauteedvegetable,dal(lentil soup),saladand yogurt.

Cookinginvolvesskill,planning andtherightingredients,andshe managesitall.Onspecialoccasionsorfestivals,I gettoenjoyspecialistsweetdishes too.

Mytinitselfis aMiltonlunchboxwithitsowncarrystrap;Miltonis averypopularlunchboxmanufacturingcompany.

Tiffintinsaredeliveredjustin timeforlunch;everyday,a mancalledVikaspicksupthefreshlycookedfoodfrommyhomeanddeliversitto myoffice,supportedbyafully-fledgedlogistics team.In fact,all overMumbai,dhabbawallahs whoareknowntobepunctualanddisciplined useacomplexsystemto getthousandsof these

lunchboxesto theirdestinationseveryday. Myown lunchboxtravelsto theofficeeachdaybylocaltrain!

Theeffort ismuch appreciated.Itgives immensesatisfactionandpleasuretohave delicioushome-cookedfoodwhich provides abreakfromwork. Itis alsohealthy,hygienicandnutritious.

Youknow,thereis asayingthatfoodconnectswiththesoul.I believethataftermanylong hectichours ofworkingeatinga balancedmealnot onlynourishesyourbodyandmind,italsoenhancesyourwork productivity.

Ido haveonehealthtip:oneshouldnttalkwhilehavingfood.So Ieatmylunchatmyworkstationin silence,accompaniedby thebackgroundchatterofthe latestgossipfromothersin theoffice.


22/27


Accordingto Plato,Youcannot

conceivethe manywithoutthe

one.Inthecaseof Petrofacsengineeringcentrein Chennai

today, thatone isK RSR Krishna.

Eightyears ago,Krishna

movedbacktohis studenttownofChennai havingworkedall

overthe worldfor engineering

companies,includingPetrofac.

Hewastaskedwithsettinguptheoperation,and todayit isthe

singlelargestengineering office

inSouthern India.

Theoriginalideatoopenengineeringcentresin India

camein 2003,explainsKrishna.

ThefirstofficeinMumbaiwas

alreadyatcapacity,sohe waschargedwithfindinga second

siteand Chennaiwaschosen

inconsultationwiththeteamin

Sharjah.Imactually fromthe

neighbouringprovince ofAndhraPradesh,but Istudied

hereformydegreein

instrumentationengineering.

AndI amnowdefinitelyoneofthe longestservinggeneral

managers,saysKrishna.

Althoughnotthe oldest

Theoriginalplanwasfor100people,butKrishnasaysthat

KRSR KRISHNA

etrofacsengineeringcentres in Indiaaree powerhouses of its project delivery.

etrofacts talks totwo ofthe companys

eneralManagers KR SR Krishna inhennai andPawanKumarin Delhi

ocompare notesfromopposite endsfthe country. Photographsby RaySmith

WHENSOUTHMEETSNORTH

OUBLEVISION thingsstartedto goreally well.Wegotmoreandmorework,

wemobilisedmoreandmore

people,andsoon wewere

deliveringprojectseverywhere.

Today,there are2,100people,including700working on

project-contracts.These

includeprojectand engineering

managers,engineers,designers,and3D modellers.

Petrofacs successstory in

Chennaiisall downtothestaff

members,whose tremendouscontributionsmake thissuch

adependable office,

demonstratingthe cultureand

valuesof Petrofac,saysKrishna.Buthe canalsorecalla

timewhenitwasjusthimanda

fewothers.Whenyourea small

team,it isveryimportanttoestablishthe rightkindof

culture,heexplains. Now,we

areahugeteam,andit isequally

asimportant.Krishnadescribesa truly

multi-cultural,multi-lingual,

multi-religiousoperation.There

arefour differentlanguagesin

SouthernIndiaalone;andallthemajorfaithsare represented

here,he says.Wetryto liveand

celebrate togetherin an

inclusiveway.EvencompetitorsinChennairemarkupontheir


PAWANKUMARteamspirit, headds proudly.

Krishnaisequallyproudof the

rangeof workthatChennai

doesfor Petrofacand itsclients,

supportingallfour divisionsof

ECOMfrom concepttocommissioning.Right now,

wehavemorethan10projects

inprogress,hesays.These

includework inAlgeria, SaudiArabia,Iraq,Oman, theNorth

Seaand AbuDhabi. Employees

alsosupport Petrofacsofficesin

Sharjah,Wokingand Aberdeen.Internationalassignmentsare

commonin India,and Krishnais

noexception.He hasworkedin

Qatar,Kuwait, Malaysia,Oman,theUnited ArabEmirates,and

evenSiberia.I mhappytomove

wherethe companywantsme

togo,heexplains.Infact,oneyear,it wasntjusta questionof

movingmilesit wasmoving

fromone extremetoanother.

Iwentfromminus53degreesinSiberia,to around50degrees

inSharjah adifferentialof more

than100,he laughs.Itmight

notsoundit,butitwas a

fantasticlife experience.Krishnaisnow looking

forwardtosharing hisexperiences

withhis newcolleague, Pawan,

whomhehasmetat industryeventsinthe past.

ForPawanKumar,his new

appointmentas General

Managerof PetrofacsDelhi

officerepresentsboth anew

beginningand a homecoming.Bornandbredinthenorthern

capitalof NewDelhi, Pawan

didntremainin hishometown

forlong.Fromearlyon,I wanted

tobecome anentrepreneurand

technocrat,he says,first getting

adegreeinmechanicalengineeringandlateranMBA.

Althoughnew toPetrofac,

Pawanis aveteranofthe

sector, withalmost 34yearsexperience.He beganhis career

withEngineersIndia,whichhe

referstoas themotherorganisationfortheoilandgasindustryin India,stayingthere

fornearly23 years.He wenton

toholda seriesof positionsat

MottMacDonald,FosterWheeler,Dodsaland Essar,

beforebeingapproachedby

Petrofactoheadup theDelhi

EngineeringCentre(DEC).Thecomplexityof theprojects

thatPetrofactakeson really

appealedtome,he adds.

TheDEChasworkedonlargecontractssuch asADCOsgas

compressionprojectand

KNPCsClean FuelRefinery

projectin Kuwait.The latterwas

aturningpointforthe office.KNPChas broughta revolution

inthe developmentofparticular

downstreamprocesses and

plantdesign, hesays.Weincreasedour numbers;

wedeveloped oursystems;

andweprovedthatwe can

deliverbetterprocesses.Pawanis keentoseethe DEC

adaptas itgrows. Managing

anddeliveringcomplex

processingplantsrequiresthesimplificationand organisation

ofourprocesses,andIm

lookingforwardto the

developmentofcapabilitiesand

capacities.Today,there are

600engineers anddesigners,buttheaimis toenhancemanpowerto800bytheend

ofnext year.

TheDelhiofficeitselfisin the

cityof Gurgaon,30km

south-westofthe capital.Gurgaonis thehappening city

oftomorrow Indias own

SiliconValley,says Pawan.

Heis alsoimpressedbytheatmosphere inthe office.Every

organisationhas itsown colour,

buthere itsverylively.People

arehappy;theyhaveagreat

dealofownershipfortheir

projects.It feelslikea proper

community.

LikeChennai, theDelhi offi

hasan impressive programmofsocial events,fromfestival

picnics.ButPawanis most

lookingforwardto celebrating

thefourth anniversaryof theofficeitself,at theendof

October. Weare invitingour

familiesin,heexplains.Itwil

bea wonderfulevent.PawanKumarshares his

namewithafilmdirector,a

footballer, andeven a

professionalwrestler but waskedwhathe doesinhis ow

sparetime,he laughs.Ihardl

haveany sparetimetheseda

ButI lovenature,beingwithm

family, andmost ofall travellinhe explains,detailingtripstha

haveincludedMalaysia,

SingaporeandMadagascar.Aftermorethanadecadeo

travellingthe worldfor pleasu

aswellas work,Pawanislookingforwardto returningto

hishometownafterall these

years.It is veryexcitingto be

partofthis,hesays.Iam surPetrofacsvisionfor Indiawill

helpthe organisationreach n

heights.I thinkwe haveavery

brightfutureahead.


23/27


People

Petrofachas its fairshare of globetrotters,andsomehaveworkedin allcornersof theworld.

JennieSaywell hearsthe travellerstales of

oneof them,MarkGillett.PhotographbyMarkLehn

In2001, SeniorConsultantMarkGillett movedfromhisSouthAfrican homelandto

England.There,threeyearslater,PetrofacsPlantAssetManagementoffered hima job.Andsobegana careerthatwouldsee Markliveandworkacrossall fourregionswherethecompanyoperates.Hisfirstrole forthe

newly-formedPAMCBMnetteam involvedsettingupconditioningmonitoringprogrammesfor clients.Althoughbasedin England,theinternationalscope ofMarksjob meant that he was posted

FOURCORNERS

OFTHEEARTH

MarkGillettonthe shorelineofhiscurrenthome townofPerth, Australia


Ivebeenveryblessedto havebeentoplacesthatmost peoplewill nevergo to,andto seesomeunrealsights

tosome exotic destinations.Iworked onvarious projectsfromtheNorthSeaall theway

downto PapuaNewGuinea,hesays.IwassenttoKuwait,notlongafterthewar,withblackenedground andbombed-outbuildings. I wasalsosent toLibya.Marks lastassignment wasin Basra,Iraq.Youstartoffwiththeshockofbeingpickedupatthe airportinanarmouredvehicle, andbeinghandeda bullet-proofvest.Itwas quitean experience!In2007,Markmovedtothe

PAMMaintenanceIntegritygroup,workingon

maintenancestrategiesforclients.His firstassignmentwasinAlaska,andwhilehe

wasmostlybased inAnchorage,the actualprojectwas250milesinsidetheArcticCircle,ina placecalledDeadhorseinPrudhoe Bay.Whatan incredibleplace

thatwas,Mark recalls.Inwinter,its completelyfrozen.Insummer,the tundraisalllakesand grasslands,teemingwithwildlife.Ive neverbeenonefor photography,butI wassoinspired,Iactuallyboughtacamerathereand then.Thecountrysidewas just

astonishing,andit wasfullofincredible down-to-earthpeople mostlysporthuntersandfishermen.I thoroughlyenjoyedmyselfthere.Aftertwo yearsMarkleft

Alaska,with amazingstoriestotell,includingcoming within100metresof amotherpolarbearandhertwocubs.Heremembers:Wewereina

vehicle,andwheneverabearissighted,thewildlife securitypeoplecordonit off. If thebearisnthungry,itl l justgo tosleepbut ifitshungry,itsakillingmachine.Wehad rangerstellingus,Dontyou daregoanycloser!Markdecidedtorelocateto

theMiddleEastin 2011,whilethecompanywassettingupanAbuDhabioffice,andfoundhimselftradingone extremetemperaturefor another.WhenI leftAlaska,itwas-50C awhite-out,hesays.WhenI landedin AbuDhabi,itwas50C:a100Cswing!Abu Dhabiwas aninteresting

moveforMark,whosawit asareal meltingpotof cultures.However,his timethere wasshort-lived:no soonerhad hesettleddownthan theteamwonaprojecton theRumailaoilfieldinIraq.MarkwasmadeProjectManager,and workedthereon a rotationalbasis,

splittinghistime betweenBasraandhome.Bythe timetheproject wascompleted,Markwas runningthe rotatingequipmentdepartment.Fouryearsafter arrivingin

AbuDhabi,the startof 2015speltthestartof yetanothernewjourneyfor Mark.ThisJanuary,he acceptedhiscurrentjob inPerth, workingontheINPEX project.Theyrecallingita megaproject,hesays.It involvescombiningthreeverylarge facilitiesinto

one giantproject.Its absolumassiveforus.INPEXmightbea projecto

mammothproportions,butMarkfindshis newhomeofPerthto havemoreof apersonalatmosphere.Perthfeelsmorelikea bigtowntothanacityof twomillion,hesays.Itsreally welcomingalaid-backhere;theresamassiveexpatcommunity.Youarewhatyouare,andeveryoneishappy withthat.MarkswifeJanice and

daughterAlexandra havemovedwith himto AustraliaTheyneverlived anywhereotherthan SouthAfrica befotheyrefindingthisallawfuexciting.Im thoroughlyenjoyingAustralia, hesays,admittingthathe feelsmoresettledwith hisfamily aroun

him.Itsso nicebeingabletogohomeeverynighttomyfamily.Before, Iwas goingfrohotelto rentalto communalhouse,which isnot alwayseasy,he adds.Aftera decadeof livingin

differentplacesacrosstheworld,Mark islooking forwatostayinginone place atleast,fora fewyears.Ivedoanenormous amountoftravellingin mylifetime,andliketodolesstravellingnow.veryhappytosaythatIvenogotona planeforfourmonthsnow!However,Mark hasone fin

destinationin mindonce hisdaughterhascompletedherschooling.Ivebeen veryblessedtohavebeentoplacthatmostpeoplewillnevergto,andtoseesomeunrealsights.ButthenextplaceImmovingtois England,he saIwanttorelocatebacktoLymingtonin theNew Fores

Ihavea lotoffamilyandfrienthere thatstheplaceIrealcallhome.

Does Mark deserve the title

of Petrofacs most prolific

globetrotter? Do you knowsomeone who has li ved in mo

places th an Mark? Are you

thinking of relocating, and

would like advice fromcolleagues with similar

experience? Do let us know

at petrofacts.editorial@

petrofac.com


24/27

People


nceagain,the competitionineSpringissueof Petrofactsracteddozensof entries.Thecompetitionset youthisgicalchallenge.Youand alleagueneedto exchangeauableitem.However,youvefoundinthe pastthatythingyousendto eachherinsecurelygets stoleninansit.So youagreeto puttheminsidea box,whichcanbeckedwith severalpadlocks.Youeachhavea numberofdlockswiththeir

correspondingkeys.Unfortunately,neitherofyouhavekeystoanyof theotherspadlocks.Howcanyousendtheitem

securelyintheboxto yourcolleague,sothattheycanopenit? Rememberthatanythingyousendin anunlockedbox(like akey,oranunlockedpadlock) willgetstolen.Thefirstfiveluckywinners

whoworkedit out,andeachwonan iPodshuffle,were:

KashyapMishra fromDelhi;AlecJones fromWoking;VinodMartulefromMumbai;DaveWardfromSouthampton;andRanjith ChandrasekaranfromMumbai.Andthesolution?Youput

yourvaluableitemin thebox,lockitandretainthekey.Youthensend thepadlockedboxtoyour colleague.Shecannotopenit but she

putson her lock,retainingthekeytothat,andsendingthebox,now withtwo padlocks,

backtoyou.Youthenunlock and removeyourown padlock.Theboxremainssecuredwith yourcolleaguespadlock,to whichshehasretainedthekey.Soyoucansafelysendit backtoheragain,andshewillbe abletounlockituponreceiptandremovethevaluable item.Congratulationsto allof our

winnerswhocameupwiththesolutionand goodlucktoeveryone considering thisissuespuzzle!

buildinghasa panelof threehtswitches,which arebelledOnandOff.Allofemare currentlyOff.Theomstowhichtheyarewiredealldistant.Onlyoneoftheeeswitchescontrolsthehtin thebasement,whichisongwayaway,andliketheherrooms,cannotbe seenmthe switches.

Youwantto discoverwhicheofthethreeswitchesntrolsthelightin thesementbutyou onlywantmakeonejourneyinordertonfirmthe answer.Youarealoneinthe building;ucannot dismantlethe

witchesor traceany wiring.tthereisa way,usingthe

witches,andwithout visitingyotherrooms, whichwillableyouto gooncetothesementandknow whichonehe threeswitchescontrolslight.Whatdo youdo?

ryourchancetowinonefiveAppleiPodShuffles,easeemailyour answerpetrofacts.competitionpetrofac.com.Closingdateentries is1 January, 2016.

anyou solvethisissueslogicpuzzle andwin yourselfa prize?

WHICHSWITCH?OGICPUZZLE

JAYDANIELWRIGHT