Successfully Delivering in a Challenging Market

ISSUE#1 | 2015

www.kcadeutag.com

I know that these challenges are on everyone’s minds as we each worry about the impact they might have on us personally and professionally. We cannot predict when the oil price will rise again and to what level. We know the industry is cyclical, and we know that with a growing global population the demand for oil and gas will increase in the future. However, the laws of supply and demand dictate the price. We cannot control this.

So what are we doing to position KCA Deutag in this new oil price environment? How can we as a business maintain the forward momentum we delivered in 2014 into 2015, despite what is happening in the wider industry?

Your senior management team are committed to seeing the business successfully through this volatile period and over the last six months we have made some difficult decisions which we believe will successfully deliver results and enable KCA Deutag to continue to flourish.

As you all know, we have implemented a number of cost saving initiatives and looked at ways to restructure our business to ensure that we continue to deliver top quality service to our clients whilst operating more efficiently. Our aim is to try to retain as many talented people in our business as possible to ensure we are well placed when market conditions improve, which they surely will at some point.

For every one of us, our focus in 2015 should be to continue to improve our performance, delivering operational excellence for our clients and growth in the business where we can despite

the oil price. If we work as one team with these common goals, we will all support the group in achieving its key performance targets this year. We can do this by following our core values

and working the KCA Deutag Way. This has never been more important than it is today.

We have a strong business model and our HSE record is market

leading. At the end of November 2014 our TRIR was down from 0.52 at the start of the year to 0.33, the best ever recordable rate in the company’s history. At the end of February 2015, it had reduced even further to 0.30. Whilst we must continue to strive to do better, this is a fantastic achievement, positioning us well to respond in these market conditions, as clients recognise the strength of our HSE performance.

Our business is based on long term relationships with our clients. If we perform better than anyone else and support them in these difficult times, I believe that we will retain existing clients, win new ones, and cement our position as a trusted and valued partner.

In the midst of this, it is important to remember the strength of the people who work here and your commitment to KCA Deutag. While the oil industry is facing challenging times, I believe in its long term future and the ongoing success of KCA Deutag as one of the world’s leading drilling and engineering contractors.

Norrie McKay CEO

Message from the CEO

I cannot start my message today without referring to the current challenges in our industry brought about by the reduction in the oil price.

“While the oil industry is facing challenging times, I believe in its long term future and

the ongoing success of KCA Deutag.”

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NewsT-700 Celebrates Three Years TRI Free

Congratulations to the T-700 crew on reaching three years without a single recordable incident.

On February 13th 2012, the T-700 land rig started operating in the Netherlands for NAM, a Dutch exploration and production company. Three years on, the crew, subcontractors and client representatives continue to demonstrate an ongoing commitment to health and safety.

This tremendous achievement marks a significant milestone in our goal to create an incident and injury free environment and is the result of working with the right attitude and the will to succeed.

A huge well done to everyone who contributed to this success.

Azerbaijan Celebrates Significant Safety Milestones

KCA Deutag’s Azerbaijan operation reported a 36% drop in recordable incidents in 2014, from 0.52 to 0.33. In addition to this, over 1.8 million man hours were completed without a single LTI, across the entire rig fleet.

Tale Javadov, HSEQ manager for KCA Deutag in Azerbaijan said: “Whilst we are proud of our achievements in 2014, we must not become complacent. We must continue to maintain and develop our HSEQ performance for 2015 and beyond. “One of the key factors in accomplishing our improved performance in 2014 was our active engagement with each area of KCA Deutag’s Azerbaijan operation. We conducted two ‘perfect day’ workshops to share and discuss the measures that needed to be adopted to prevent accidents. Several TRIC workshops also took place to help educate offshore supervisors about their roles and responsibilities for ensuring all hazards associated with working offshore were properly risk assessed.

“Rig engagement calls between on and offshore management teams have also proved to be a valuable approach to sharing information, raising HSEQ issues and finding suitable solutions. Congratulations to everyone involved.”

T-72 Minister Visit

On the 25th October 2014, a delegation of 28 high profile legislative personnel including the Pakistan Minister of Petroleum, visited the T-72 Rig, currently operating in the Margalla North Block for MOL Pakistan.

The main purpose of the visit was to evaluate KCA Deutag MS against local laws and regulations Including, Pakistan – Oil & Gas Industrial Rules 1974, Labour and Manpower Law – CIM 1923 / 1952 and Shop & Establishment Act 1969, whilst assessing the industrial working relationship on the rig and the support provided to the local community.

Security clearance of its expatriate staff, ERP, country crisis management plan and policy objectives were also audited during the visit to the satisfaction of all concerned.

The Minister of Petroleum also expressed his satisfaction on the implementation and mitigation of the legislative rules concerning theT-72. Well done to everyone involved.

In This Issue03 News

04 T-46 - Albania Demobilisation Outstanding Contribution Award

05 Training - Rig Floor Mock Up

06 Regional Focus: Canada

08 SCM Apprentices

09 Business Efficiency

10 An interview with Norrie McKay, CEO

12 Business Excellence Update

13 HR - Health and Safety Focus UK Operations Performance Workshops

14 Journey of an E&M Auditor

16 Bentec Update

17 Land Commercial and BD Conference

18 Five Minutes with Tony Byrne

19 Celebrating Success

Get in touch

We hope you enjoy this edition of Venture. If you have any feedback, or suggestions for articles in the next edition, please contact:

communications@kcadeutag.com

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the project, held in our Bad Bentheim offices, where details of the project and challenges were described, and a Project Execution Plan (PEP) was created.

This plan covered the full project life cycle from the preparation of Cost Time Resources (CTR’s) for rig-down at location, through packaging and transportation to preparation of customs clearance documentation. It covered every stage right through

to the loading and transportation of the rig once it reached Germany and culminated in the off-loading of the rig at the storage facility. From the outset, safety was given a top priority, especially during the critical rig-down and loading

Rig Manager, Dave Wood, has been commended for his successful solution to a problem that resulted from a serious incident in the field, caused by rig crew using an inappropriate tool for a job.

The incident happened because a crew member used a piece of wood to displace mud in the drill pipe tool joint when making a connection whilst Dave was a Rig Manager on the East Azeri platform. The person then dropped the piece of wood in the tool joint, which was pumped down the drill

To minimise expenses following its release, a decision was made to demobilise and transport the rig for storage in Germany.

The demobilisation process followed meant that it was achieved within time, within budget and without recordable incident. So what was the process we followed to successfully demobilise, pack and transport the T-46? It started with a kick-off meeting for

Commending outstanding performance

Rig manager receives recognition for outstanding contribution and dedication.

T-46 Successfully Demobilised

Rig T-46 has been successfully demobilised after more than 2 years of drilling operations in Albania following its release by the clients.

string causing a blockage. A number of failings were reported at the time of the incident; using the wrong tool for the job and furthermore, failure to report the event at the time leading to normal operations continuing, which caused rapid pressure increase. The incident resulted in two days NPT and significant cost to the company. Azerbaijan Country Manager, Phil Woods tasked Dave with developing a solution to replace this homemade tool which was commonly used in the field. A design was developed,

phase. A general risk assessment was performed by all personnel involved, where participants were asked to address the risks associated with their specific task, and to provide a proposal for the mitigation of those risks. The general risk assessment is considered a very effective tool and ultimately ensured that this job was executed safely and without incident.

Regular meetings and reporting by the project team, headed by Rig

Manager, Said Kamrani, and Global Supply Chain Management to select and appoint a provider for sea transportation and a vessel at competitive rates, all contributed to the successful demobilisation of rig T-46. Congratulations to all involved.

Contributed by: Phil Woods

Contributed by: Said Kamrani

produced, and successfully trialled offshore, resulting in new ‘Dunkers’ being supplied to all platforms and mobile units working for the BP Caspian region.

We would like to say well done and thank you to Dave for all his time and dedication, which has seen the project taken from inception to successful conclusion. We would also like to thank BP and Jim Morton, RDS Project Engineer for his assistance and valuable contribution.

“From the outset, safety was given a top priority.”

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Training – Rig Floor Mock Up

Following on from several incidents that have occurred surrounding rig start-ups, involving personnel new to KCA Deutag, a 2 day training event was developed by the UK Training Manager at the request of the UK operations team.

The training was designed to ensure that all personnel, both new and old, understand the KCA Deutag way of working whilst highlighting awareness and the use of appropriate safety tools.

For the event, a mock-up of a rig floor was constructed in the warehouse in Aberdeen and the teams from Nexen Scott, and CNRI’s Ninian North and Murchison platforms were invited to attend. The course commenced with a series of presentations starting with an explanation of the company’s visions and core values. This was followed by more tailored presentations on Rig Floor Safety and Lifting Operations, coupled with good discussions on all relevant KCA Deutag safety tools: TRIC, pre-shift briefings, risk assessments, manual handling assessments and work guidelines.

The crews were then given an introduction to Kompass and practical sessions on completing TRIC cards for the tasks they were about to undertake. The crews then began hands on training by completing a range of tasks, as explained by Scott Jenkins, UK Training and Competency Manager;

“The tasks included lifting the pipe onto the cat walk and then up the V rig floor, setting it in the rotary table using pipe slips. Once set, picking up another joint of pipe and stabbing it into the joint in the rotary table and making it up using a chain tong. When complete, using the rig tongs to torque the pipe ensuring correct hand and body positioning at all times.

When the task was successfully completed the crews had to repeat it – this time in reverse, laying the pipe joints back out onto the cat walk.”

Scott summarises, “Every employee has a responsibility to understand their role and everything it covers but most importantly how they should operate the “KCA Deutag Way”. By completing this form of training the crews learn first-hand the correct way of working in a safe, controlled environment. This event was the first of its kind in the UK, but hopefully it will be repeated in the future as the feedback from attendees was very positive.”

Contributed by: Scott Jenkins

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Unlocking Canada’s Oil and Gas Industry

Contributed by: David Fong

FEED work for the Hebron platform over a two year period and in 2012, was tasked to deliver the detailed design.

This presented a challenge for the RDS team, as over 150 skilled local workers were required to support the team in St John’s to see the project through to the final drilling operations phase. “The recruitment and retention of talent is an ongoing challenge that needs to be managed throughout the project to ensure we have a competent and highly skilled crew delivering safe, trouble-free operations,” said David.

Following early involvement in the development, the company knew the project inside out, from the rig design to the harsh environment. This was key to KCA Deutag being awarded the

contract for drilling operations on the Hebron platform.

Once Hebron is installed, there will be only two offshore platforms in the Newfoundland and Labrador region, both of which have been designed by RDS.

Rodrigo Rendon, Head of Business Development at KCA Deutag said: “Like any new region, Canada comes with its challenges. It is a sub-arctic environment, with icebergs, snow and freezing temperatures, so operating in the Canadian Atlantic is no mean feat. The Hebron platform will be built using a reinforced concrete gravity based structure designed to withstand sea ice, icebergs and meteorological and oceanographic conditions. It is a major project that will deliver significant benefits to Newfoundland and Labrador

“We have seen an increase in overall oil and gas activity in Eastern Canada and with new technology extending the life of existing fields in ways that weren’t possible just a decade ago, we are constantly looking into emerging opportunities. “The Canadian offshore market remains relatively healthy despite the current climate and it will continue to be a region of focus for KCA Deutag in years to come.”

Last year, KCA Deutag expanded its operations in the Canadian offshore drilling sector following the award of a multi-million dollar contract with ExxonMobil.

Fast forward 12 months and the Hebron project is really beginning to take shape from an operational perspective. With a team of 28 people already in place, the platform is currently under construction in Korea.

David Fong, Country Manager for Canada, said: “Over the last few years, Canada’s status as a strong global player on the oil and gas stage has risen significantly. With the third-largest accumulation of proved reserves in the world, after Venezuela and Saudi Arabia, Canada has the potential to become a global energy superpower.

“The ongoing development is already influencing the market in North America, with Canada’s production poised to reach 3.6 million barrels a day in 2015.

“There are currently three offshore oil projects operating offshore Newfoundland, Canada. The Hebron field, which is estimated to hold around 700 million barrels of recoverable heavy oil resources, will be the fourth.

“The platform is currently under construction in Korea. We have a team of 10 who are based at the shipyard and we expect to complete phase one of the project within the next few months.

“With production expected to begin by 2017, we will be launching a huge recruitment campaign next year to find talented crew members.”

KCA Deutag’s expansion into Eastern Canada is a key strategic success for the business and capitalises on the work carried out by RDS in the early stages of the project.

RDS delivered engineering work scopes for the two Hibernia rigs from 1991 -1997, establishing its presence in Newfoundland and Labrador. This was a significant contract win for RDS, as the majority of Canada’s offshore output derives from the Hibernia field. In 2010, due to the company’s involvement in the Hibernia project, RDS was commissioned by Worley Parsons to carry out the FEED work and detailed design for the Hebron platform.

A team of engineers and drilling operations personnel from St John’s and from the RDS office in Houston completed the

“The Canadian offshore market remains relatively healthy despite the current climate

and it will continue to be a region of focus for KCA Deutag in years to come.”

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Successful Implementation of the First SCM Apprenticeship

Programme in Russia

On 1st September 2014 KCA Deutag launched the Supply Chain Management Apprenticeship Programme (SCM APP). A pilot project aimed at developing the skills of the warehouse workforce. Based on the German dual education system, this internal training programme

was developed in conjunction with the Tüv Rheinland project team with a focus on working the KCA Deutag Way to deliver safe,

effective, trouble free operations.

A group of 12 trainees began the programme in September, undertaking 5 months of theoretical and practical training before taking an intermediate exam at the end of January 2015. Arne Semsch, Regional Supply Chain Manager for Russia explains;

“The theoretical curriculum targets functional topics such as Logistics, Warehousing, Transport and Procurement. Furthermore, critical subjects such as HSE, technical basics, SAP training and English lessons were conducted to adhere to KCA Deutag’s requirements. The utilisation of all safety tools such as SET, TRIC and TOFS as well as active monitoring were also stressed by instructors, guest speakers and mentors.

The practical part of the curriculum covers the physical aspects of working in the Central Warehouse (CWH). Based on the theoretical input the trainees, mentored by the existing specialist workforce, apply practical training under real working conditions. Every working day started with a safety meeting conducted by the team leader, emphasising the importance of safe work and the utilisation of the available safety tools. This also provided an opportunity to discuss examples of good catches and active monitoring. The combination of theoretical knowledge mixed with practical education taught by the experienced and skilled CWH team aims to build a strong foundation for later work.

At every stage of the SCM APP the progress of each trainee is evaluated, analysed and measured by both SCM and English instructors against the initially set requirements and targets.

I am pleased to report that the exam, divided into three major parts: a written test, a verbal test and a SAP case study, was passed by all trainees, with an impressive average result of 85%, reflecting the hard work of trainees, instructors and mentors.”

On completion of the intermediate exam the trainees were then qualified to undertake on the job training at the rig site. Each trainee will work two training shifts on different

rigs, to experience and gain a full working understanding of the diversity and particulars of each drilling operation. To complete the apprenticeship programme the trainees will need to pass a final examination at the Tyumen Training Centre in the summer of 2015. This final examination will be managed by an external organisation.

Contributed by: Maria Nikolaeva

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Supporting Efficiency Through Global Supply Chain

Management

In 2012 KCA Deutag launched a Business Efficiency campaign, a project created to increase productivity, reduce expenditure and

release capital to be reinvested in the growth of the company. Now in 2015 we look at what this has meant for the business so far, and

what it means going forward.

A major part of the campaign was managed by the Global Supply Chain Management (SCM) team, with a focus on implementing an improved supply chain process that will transform the way we work across all KCA Deutag divisions and locations. Ian Anderson, PMO for SCM explains:

SCM set a target of 50% of our annual PO spend to be through contracted suppliers by the end of 2014. Through achieving this we are able to leverage improved deals with our suppliers. We continue to create platforms with agreed prices and schedules from reliable suppliers which will significantly reduce the need for ad-hoc purchasing, not only saving costs but also increasing efficiency for the Group by streamlining the purchasing process. For our team, this improvement will mean that more time can be spent on critical contracts and negotiations rather than low value day-to-day procurement.

We’re also streamlining our due diligence processes and creating a robust pre-qualification system for suppliers. This will guarantee that all of our suppliers are both aware of, and comply with KCA Deutag’s Supplier Code of Conduct.

Headed up by Jessica Gerdsland, the system efficiencies work stream has also implemented a number of improvements, including a new automated PO process for items maintained on pre-agreed contracts. Following on from this the SCM team are piloting an improved search facility and material master request form which will speed up and simplify the identification of equipment and spares as well as the process for requesting new codes.

Responding to the challenges facing our industry currently, SCM has established the Cost Avoidance Project. Continuing on from the deliverables of the business efficiency initiatives the project aims to achieve further cost savings, avoid costs and implement further efficiencies for the business.

With a focus on reducing total costs of purchased goods and services, and improving planning and execution, SCM has initiated contract negotiations for existing and proposed agreements.

Through this project our Land operation has identified saving opportunities and are negotiating across their regions. Offshore will also facilitate saving initiatives in Norway, Azerbaijan, Singapore and Sakhalin. The group as a whole benefiting from any savings negotiated. Talking about the future of these campaigns, Andrew Mojsak, Head of SCM, said: “Business Efficiency is not a project that ended in 2014. It supports the long-term sustainable growth of our company and could result in significant savings year on year.

“It’s essential that all employees, across the globe, utilise the existing contracts that are already in place. This will ensure we get maximum value from our suppliers, not just in terms of costs but also in quality and service. Failing to use these contracts can have costly and time-consuming implications for the company.

Andrew concluded: “Sustainable growth is a core value to our company and the leverage from the success of Business Efficiency allows us to enhance the opportunities and potential of the Cost Avoidance Project. In addition to driving down costs and increasing productivity, it allows us to reinvest in our future and fulfil our vision of being recognised as the world’s most successful drilling and engineering contractor.”

Contributed by: Ian Anderson

“We will be able to leverage improved deals with our

suppliers.”

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The CEO’s ViewAn interview with Norrie McKay

Having been in the business for the last thirty-four years, our CEO Norrie McKay has been through many of the ups and downs in the oil industry. Today, he shares his experience and his plans for KCA

Deutag as he takes the group forward into the future.

How did you get to where you are today? I started out with Schlumberger in 1981 as a Field Engineer before completing long term assignments in Libya, Italy, France, North and South America and progressing through the ranks into senior management roles. I joined KCA Deutag in 2011 as Executive Chairman and became Chief Executive Officer the following year with the remit of focusing on accelerating the growth of the business while delivering safe, effective, trouble-free operations.

Why is the price of crude oil affecting the industry in the way it is?

The market is driven by the major oil producers, many of which, with a lower crude oil price are not receiving a high enough return on their investment. As a result they are reducing their capital investment programmes and mothballing those projects which are not economically viable.

In general with a reduced oil price, the industry needs to improve operating margins and this is a key area of focus not only for KCA Deutag, but also our clients.

What do you think is going to happen to the price and do you think this will lead to a long term correction?

The substantial decline in the price of oil is not unusual and has happened many times before. The last dip in the oil price was in the 2008 global financial crisis when the price declined from a peak of $147 per barrel to $32 per barrel.

The price at the moment is driven by oversupply at a time when global economic growth is slowing down, reducing oil consumption and negatively impacting the price. The major oil producers today are Russia, Saudi Arabia and the United States as a re-emerging entrant to the market. The production of US shale oil has changed the supply and demand dynamics and it is taking time for the market to adjust to this. I do not think we should expect this to happen quickly.

However I do believe that, given the cyclicality of the industry and increasing demand which is forecast to rise by 5 million barrels over the next five years, the oil price will recover although to what level and over what time period is unclear.

The challenge for us will be to identify where this additional supply will come from and to be ready to support that.

How did you decide on KCA Deutag’s response to this?

In making decisions on how we operate our business in this new low oil price environment, we looked to position the company for growth and secure its long term future no matter what the oil price is. Our people are our most important asset and it was fundamental to us to ensure that we retained as many people in our business as possible, so we are ready once the market returns. Hence the difficult decisions we made and when we asked for your support, the loyalty shown by each and every one of you was greatly appreciated.

Aside from the oil price, what are the main issues which will secure the future success of the industry?

I believe that new technology will continue to open up new frontiers in the oil industry, enabling producers to access previously inaccessible fields, improve recovery rates and lengthen the lives of existing fields.

To operate this new technology the industry needs young skilled people to join and grow with it. Whilst this is not an issue in the current market, I believe that once the market recovers, finding and retaining exceptional talent will once again be a priority for every business working in the oil and gas industry.

How are you shaping KCA Deutag to compete in this new environment?

Our main aim has been to ensure that we continue to be successful in 2015 and beyond. As part of the ongoing management of our business, the senior management team constantly reviews the way the group operates to ensure that it fits our needs and maintains our position in the market place. We compete on two major fronts - quality of service and price.

As the oil price dipped we have seen increasing pressures from our customers to reduce costs and certain projects have either been postponed or cancelled. As a result we took additional steps to manage our cost base which was too high for the current environment,

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whilst maintaining the quality of our service offering and removing any inefficiencies in our business.

The strength of our relationships with our clients and our reputation as a premium drilling contractor are of paramount importance to our future success. We must all continue to work hard to maintain and improve these through adhering to our core values and working the KCA Deutag Way.

What opportunities are there for expansion into new markets?

There are a number of regions we are actively targeting for expansion which could make a real impact on our business. Obviously in today’s market our primary focus is protecting our current business and ensuring that we remain in a strong position going forward. However, it is also true that there are still opportunities out there, and we will be evaluating these very carefully to ensure that the risk profile and return on investment are aligned with the best long term interests of the company before committing any resources to new projects.

What are the group’s key performance targets for 2015? Do you think these are achievable?

Our performance in 2014 was strong and maintaining this forward momentum will be difficult in 2015. However, we have set some demanding targets for the current year. To deliver these we all need to continue to improve our performance in all aspects of our work. We must tightly manage our invoicing, inventory and payables in order to maximise cashflow. We should spend our company’s money wisely, and consider the cost implications of the decisions that we make to improve margins.

Where do you see KCA Deutag in 5 years’ time?

With over 125 years of experience KCA Deutag has been in business longer than any of its competitors. We would not have this kind of heritage without being flexible in our approach and delivering the quality of service which our customers demand.

Over the years we have adapted our business model to meet the requirements of a changing marketplace

and successfully grown the company despite the cyclicality in the oil price to reach our market

leading position. We have been innovative in our approach and expanded our service

offering as the industry evolved.

During the next five years, we will continue to adapt the shape of our business as we respond to the changing oil price environment.

I am confident that by focusing on high quality service delivery to

our customers we will continue to be successful and grow.

“I am confident that by focusing on high quality

service delivery to our customers we will continue to

be successful and grow.”

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Training courses were held in Bad Bentheim, Dubai and Aberdeen with World Quality Days taking place in Baku, Tyumen and Azerbaijan. Alan Whitmore, Group Head of Business Excellence and Quality, explains,

“The training courses and the World Quality Days offered employees a rare and highly beneficial opportunity to attend a selection of quality-themed training courses on topics including management systems, QA awareness, business improvement tools & techniques and internal audit & facilitations skills. Drop-in sessions were also available in each location during the World Quality Days allowing all employees to seek advice on how to deliver excellent quality work in their individual working environment.

“During the events attendees from various divisions worked collaboratively on activities such as identifying improvement opportunities across the company and sharing ideas and examples of best-practice from different divisions.”

Alan continued, “The Business Excellence team would like to extend their thanks to all the attendees of the training courses and 2014 World Quality Days, across the globe. The feedback has been hugely positive and the team look forward to welcoming colleagues to future events.”

Delivering Quality Throughout the Organisation

At KCA Deutag we pride ourselves on delivering world-class quality work to our clients. To support this, the Business Excellence and

Quality team coordinated and hosted a number of events in 2014 to promote quality and training throughout the organisation. Global

events focused on taking quality out on location, sharing knowledge and ideas on how we can continue to strengthen our performance,

and the important role our employees play in supporting the quality of work we provide.

Contributed by: Lola Ajagbonna

The Business Excellence team would also like to congratulate the teams and locations involved in the 2014 ISO9001:2008 recertification process. Seven locations where assessed by various Det Norsk Veritas (DNV) assessors, all verifying the demonstration of a high level of compliance within KCA Deutag. Congratulations to all personnel at the locations visited for delivering an exceptional result.

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UK Operations Performance Workshops - 2014

In November, UK Operations held their annual Rig Superintendents Performance Workshops. The aim of these workshops is to aid the

creation of performance contracts for each rig, but also to share and discuss important topics highlighted over the year.

Lynne Clow, SVP HR, explains, “Every member of the team was asked to complete a Personal Objectives Plan, with stated objectives in the areas of health, safety and environment not only for their work but also their home life. These objectives make up part of the new ‘Office Safety Inspection’. Carried out fortnightly the inspections ensure that all areas we work in, and the people we work with abide by our health and safety value.”

Exploring health and safety further, the team visited the Weatherford drilling rig in Aberdeen with UK Operations

A number of people were also congratulated for their hard work and presented with an award for their contribution to recent successes. Stuart Sutherland and Colin Campbell, who both work onshore, received their level 2 qualification for leadership and team skills. John Munro, a Driller on the Dunbar platform and Chris Clark, Senior Rig Superintendent, also received their qualification for leadership and team skills. Steve Bunch, who also works on the Dunbar platform, was congratulated on his 35 years’ service with KCA Deutag.

The Heather Alpha and Dunbar platforms were also commended as they both scooped a UK North Sea ‘Rig of the Year’ accolade. This award is based on the following criteria: total recordable incident rate, potential matrix factor rate, competency, training, number of pre and post tasks submitted and non-productive time. As well as these figures, the rigs were judged on overall performance throughout the year.

Manager, Jim Paterson. This provided them with an opportunity to experience first-hand the potential hazards that are on a rig site, whilst gaining an understanding of the challenges that our colleagues face on a daily basis in our operations. Jim delivered an inspirational session, outlining the life cycle of oil, key rig equipment and gave attendees a greater understanding of the different types of rigs that KCA Deutag operates. The session proved not only beneficial in providing a full overview of what we do as an organisation, but it also gave the team a greater understanding of what the function can do to support our people in operations.

HR – Focusing on Health and Safety

Leading by example

As one of our core values, health and safety is an integral part of the culture of KCA Deutag. One department showing initiative and leading by example is the Corporate HR team. With an increased

focus on health and safety throughout their department the HR team demonstrate how they are living the value.

Contributed by: Craig Thomson

Contributed by: Hannah Rossiter

In attendance were all UK Rig Managers, Senior Rig Superintendents and Assistant Rig Superintendents. Pauline Weddell, Head of Organisational Development addressed the main theme of the workshops, ‘Ownership and Accountability’. UK HR Manager, Fayona Milne and UK Maintenance Manager, Ian Milne were also presenting, specifically focusing on the avoidance of non-productive time. In addition to this, Peter Williams, Offshore Operations Manager gave an overview of the current status of the company in terms of where we are now and what our key objectives are for the mid to long term future.

Rig Managers were also asked to create and deliver presentations, highlighting what brought them success and what improvements they would like to see on their rig over the next 12 months.

Over the two day event, guest speakers from TOTAL and EnQuest gave an insight into what they, as clients, feel KCA Deutag does well and where some improvements could be made.

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Journey of an E&M Auditor

Since re-joining KCA Deutag in July 2013, John Anderson has moved into the role of auditor within the Corporate Equipment and

Maintenance (E&M) team.With more than 14 years of industry experience, John tells us about his career to date and what it takes to become an equipment and

maintenance auditor.

Contributed by: John Anderson

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“I am looking forward to a busy, but enjoyable year.”

Why become an Equipment and Maintenance auditor?

Carrying out compliance audits was already part and parcel of my daily duties in previous roles, but I now get to carry out technical audits worldwide throughout the organisation. From a personal perspective, the most rewarding part of my job is I get the chance to meet some of the interesting people throughout our organisation and to sample what it is like to work and live in other parts of the world. Professionally, it is extremely useful to observe how our equipment is operated and maintained on the ground and the challenges that often extreme environments pose.

Do all audits have similar findings?

All of our rigs are governed by our E&M World Wide Standards, so you would think that the findings would be similar. However no two audit reports are the same. There are some common findings captured during these audits which have led to the corporate E&M team reviewing current procedures and creating additional guidelines to better support our maintenance colleagues.

What countries have you visited carrying out your auditor duties?

I have been to Oman, UK North Sea, Germany, Angola, Norway and Nigeria so far and plan to visit Algeria, Russia and Sakhalin Island this year. One of my biggest challenges when working abroad is the language barrier. On some audits a translator is needed to ensure that the questions being asked are understood by the rig crews being audited and their feedback is communicated clearly in return. It is great to be able to witness first-hand how our core values are being put into practice globally and then share these findings with our senior management team.

What training was given for your role as E&M auditor?

Full training was provided before I was given my first auditing assignment. This included, Lead Auditor Training (ISO 9001:2008), Moduspec Rig Inspection Workshop, Auditing Techniques for Internal Auditors and Safe 2 Lead. Having received this training I feel more confident in my ability to carry out audits knowing I have the relevent skills and experience to do my job in a thorough, impartial and effective manner.

What type of audits do you carry out?

Operational Integrity Reviews (OIR) and Operational Readiness Reviews (ORR) are the main focus of my role, but I also participate in supplier and equipment & maintenance audits. These audits are vital if we are to maintain technical

integrity of our equipment and assets.

What are the best things about being an E&M auditor?

I get to interact with other functions, for example Operations, Supply Chain Management, and HSSE, which helps broaden my understanding of how different functions interact with each other. It also helps to promote a more joined up approach to carrying out our daily business. I also like that I get to see first-hand all the good practices that are being carried out across our business, and through our audit report we can highlight and share these ways of working so that other installations can benefit from them.

What projects are you currently working on?

We have just completed our Remote Auditing project, which allows us to gather information from different rigs without the need to travel there in person. This will also be an aide to the teams going on OIR’s and ORR’s, where we can request some of the information that we require beforehand to shorten time spent on rig-sites.

What does the rest of the year have in store for you?

I am looking forward to a busy, but enjoyable year, as I continue to build relationships and progress within my career at KCA Deutag. As part of our E&M objectives for 2015, we will be implementing a Global Maintenance System, developing a Governance and Assurance framework and enhancing the use of our Asset Management System, all of which will help the Business Units to operate effectively whilst ensuring our asset and technical integrity is managed properly. For more information on any subject listed above, please contact John Anderson on john.anderson2@kcadeutag.com

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Building on Success

2014 was an extremely successful year for Bentec, as the company launched a number of new innovations and secured challenging

projects across the globe.

Contributed by: Stefan Witte

“With a complete product portfolio, our customers can now benefit from Bentec’s one-stop-shop approach to oilfield equipment.”

Excellence in service

In line with Bentec’s life-cycle approach, the company has enhanced its global service offering, which includes tailored training programmes. The new mud pump model and Variable Frequency Drive simulators provide hands-on training with realistic scenarios and tasks, so participants can learn at their own pace without being exposed to potential risks, which can cause costly delays in drilling operations.

“We are in a good position to lead our customers along the path to success and help them advance their facility’s operational performance,” said Dirk. “We are looking forward to the exciting projects and challenges to come.”

The year saw Bentec’s first top drive being deployed in the UK North Sea for a satellite platform and three fast-moving desert rigs manufactured for drilling operations in the Khazzan field, Oman.

Bentec also undertook the design and fabrication work for a new generation arctic cluster slider rig for operations in Komi, North Russia.

Dirk Schulze, Chief Executive Officer of Bentec said: “We are very proud of our achievements over the last year and the projects we have been involved in. This success is the result of our deep-rooted commitment to maintain the highest quality standards in health, safety and the environment. It also demonstrates the breadth of our capabilities, from innovation and technical expertise to our ability to operate across the globe in the most challenging environments.”

One-stop shop for oilfield equipment

Last year also marked the launch of the Iron Roughneck, the final addition to Bentec’s unique product portfolio. The Iron Roughneck is a safe and versatile alternative to conventional pipe connection techniques. The tool was designed and built to maximise the efficiency of pipe handling operations for safer, faster, more reliable drill string connections. The first units are now in operation in Romania.

Further advancements in Bentec’s equipment range include the top drive, which is now available in 275, 350, 500 and 750 tons. Offering the lowest non-productive time rating, more than 100 Bentec top drives have now been installed across the globe, both onshore and offshore.

Another newcomer to Bentec’s product range is service loops, a highly reliable power and control supply solution for all common top drives. With a five-year track record of failure-free operation, Bentec has built more than 120 service loops over the last year.

“With a complete product portfolio, our customers can now benefit from Bentec’s one-stop-shop approach to oilfield equipment. It allows us to provide a diverse and adaptable service,” said Dirk.

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Development teams, entering and assessing new markets, building strong long-term relationships with new and existing customers, providing continuous support to in-country teams, developing contracts in line with KCA Deutag Standard Contracting Principles, preparing bids and commercial models, negotiating with clients and contributing to successful operations across KCA Deutag’s land rig fleet.

We would like to congratulate the Land Commercial and Business Development teams on their tremendous achievements throughout 2014 and wish them another successful year ahead.

The Commercial Way

In November 2014, the Land Commercial conference took place in Dubai. The two day event provided a platform for open discussions

between staff from across the globe.

Contributed by: Julia Kononova

Everyone was given an opportunity to share their experiences from working in different regions, which helped to exchange best practices, ideas and lessons learned whilst enhancing international cooperation. The main aim of the event was to celebrate the efforts and successes of the Land Commercial and Business Development teams throughout 2014 and plan for the year ahead.

A panel of Commercial and Business Development managers gave an insight into operations in the Middle East, Africa, Russia, Europe and Kazakhstan, looking at the current market, future opportunities and recent achievements within these regions.

Additional sessions were dedicated to legal support and guidance, customer relationship management system implementation and the success of a Russian combined drilling services project.

Andy Hendry, President of Land, delivered a presentation on the business unit’s 2014 results and unveiled his vision for 2015.

The group worked in teams to discuss and define the ‘Commercial Way’, a more tailored approach to the ‘KCA Deutag Way’. It was agreed that as well as adhering to the company’s core values, worldwide standards and procedures, it was crucial to work in closer collaboration with Supply Chain, Operations and Equipment and Maintenance departments to deliver accurate, high-quality bids and to maintain our position as one of the world’s leading drilling and engineering contractors for many years to come.

Mike Finlay, Head of Land Commercial, gave an overview of the highlights and performance achievements of the Commercial and Business Development teams in 2014. These included new contracts awarded by Shell Brunei (T-203) and BP Oman (T-94 and T-95) and the extension of the T-47 contract in Kazakhstan. In addition a new build rig (T-506) commenced operations in Russia on schedule and another new-build was added to a Combined Drilling Services project in Russia. The team also explored possible business opportunities in Saudi Arabia.

These achievements wouldn’t have been possible without the help of the Commercial and Business

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Five minutes with...Tony Byrne

Tasked with spearheading the company’s legal and compliance activities Tony is an integral member of the Executive Management Team, reporting directly to Chief Executive Officer, Norrie McKay.

How do you like to relax outside work?

No one is going to believe this, but when time allows, I enjoy cycling and playing tennis (not at the same time, mind you!). I’m a keen football fan, coming from Glasgow, and my allegiances lie with Celtic – not sure if I should admit to that? My wife and I like to travel and as part of that we try to visit Paris a couple of times per year. It’s a fantastic city and it gives me a welcome opportunity to brush up on my French. I’m also a bit of a wine bore and I love music and cars.

What did you want to be when you were growing up?

Tragic as it sounds, I almost always wanted to be a lawyer! I did go through a phase when I was quite young when I had notions of becoming a doctor, but they soon wore off when I reached High School and discovered that science wasn’t my thing - not ideal if you want to study medicine! From around the age of 12 or 13, I set my sights on becoming a lawyer.

What are you currently reading or watching on TV? I don’t watch much scheduled TV, tending to use catch up or box sets. Most recently, I watched the latest series of Spiral, a French police/legal drama set in Paris. Bookwise, I have just finished reading Hotel Splendide by Ludwig Bemelmans, a funny old book written by a funny old man.

Do you have any words of wisdom you’d like to share?

Not to sound too contrived, but I have always lived by the rule that we should always give it our best shot, every day, in everything we do. A strange source for a quote but as I believe Duke Ellington once said “a problem is a chance for you to do your best.”

Tell us about your role at KCA Deutag.

I joined KCA Deutag as General Counsel in September 2014. In summary my role is to guide the group in all of its legal affairs and to lead the group’s legal functions worldwide.

How do you usually start your day? My day starts before I even get into the office. At home the first thing I usually do is take my Blackberry off charge and check emails before putting on a pot of coffee. The last thing I do at night before I leave is write a to-do list with the top five things that I need to do the next day. When I arrive in the office – if there are no urgent matters that need my attention, then I check my to-do list and start my day.

What’s your favourite thing about your job? It’s difficult to narrow this down to one specific thing. Two aspects probably top the list. These are the variety of work and the quality of the people that I work with across the whole business. The type of work can vary quite materially, For example this week my workload ranged from reviewing the content of a new company website prior to its launch to advising members of the Executive Management Team on a strategic global project. There’s rarely a dull moment.

How did you get to where you are now? Growing up in Glasgow, it all started with studying law at the University of Glasgow. On graduation I joined a law firm in Edinburgh where, for the next 12 years I worked between the firm’s Edinburgh and London offices. I then became a partner in a law firm in Glasgow, where I stayed for a number of years. Throughout my career I have had the privilege of working in the complex and fast paced energy industry, some of my key client relationships being in the oilfield space. I have spent most of my career advising on mergers and acquisitions, private equity deals, and general corporate matters. I relished the opportunity to join KCA Deutag, as it allowed me to expand my experience in this field, to put my existing skills to good use and become part of a dynamic global business of the highest quality.

“A problem is a chance for you to do your best.”

Interview by: Communications Team

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Celebrating Success – The Importance of Safety

It has once again been proven that an excellent HSE culture results in an excellent HSE record and leads to excellent operational performance, as demonstrated by the T-221 operating in Kurdistan.

Contributed by: Martin Nehrdich

Personal Success - Climbing Mount Kenya

Setting another target to keep fit has become the driving force of Libyan Country Manager, Graham McIvor.

The T-221, a new build Bentec SpeedRig®, began operations in Kurdistan in 2012 and since then has delivered an exceptional safety and operational performance record, one that we would like to congratulate the whole crew for achieving.

Some achievements include, 1,000 days without LTI as of the end of January 2015, one year without recordable incident and 24 consecutive months in green light NPT with an average of 0.17% during the last 12 months.

Employing 67% Kurdish nationals the rig has been in continuous operation for Marathon Oil since 2012. The results from the latest client feedback questionnaire are also very impressive, with the rig obtaining, out of a possible 31, 23 excellent grades and 8 good.

We are proud of our crews working on the T-221 who achieved such an outstanding level of performance.

A journey starting back in 1999, Graham dreamed of climbing Mount Kenya with his family. Born in Kenya, Graham relished the opportunity to return to where he grew up and complete a lifelong goal.

After the first experience, Graham’s thoughts soon turned to Africa’s highest mountain, Kilimanjaro. In August 2001, Graham and eldest daughter Shelly, reignited the dream, and planned another trip, this time to visit the farm where he grew up and to climb Mount Kilimanjaro. On September 5th, Graham and his daughter began the ascent of the mountain, completing 4 days of climbing to reach the final camp at Barafu, at 4,681m. The final days’ climb took just short of 5 and half hours to reach the 5,895m summit, an achievement that Graham admits was not easy, and describes having to dig into areas of you that are rarely touched.

Fast forward to 2015, and Graham had set himself yet another challenge. At nearly 67 years of age fitness had become a great motivator. After a series of injuries resulting in Graham steadily becoming more unfit, he knew that only a serious challenge would motivate him enough to reach his fitness goal. And so the challenge of climbing Mount Kenya a second time was set, and he began a long 9 months of winter training. Graham set the target of reaching Point Lenana over 3 days, a journey that saw him climb for up to 7 hours a day, whilst battling altitude sickness, to reach the 4,985m summit. The final day, although the shortest of the climbs, in Graham’s words, the ascent to the summit was the toughest. “For me, those 3 and quarter hours were tough and I can understand why people decide to pull out. My advice – just keep going…reaching the top is worth it.” But as they say, what goes up must come down, and after a few congratulatory photographs, Graham began the descent. Returning to Shipton’s camp, Graham changed the original plans to stay for one night on the mountain, and instead chose to descend the full way and head for Old Moses base camp. Graham explains, “The original plan was to stay the day and night there then descend, but it is strange that all you want to do is get off the mountain once you have peaked. You have had enough of being cold, dirty, tired and nervous, and you just want a bath and safety.”

So what’s next for Graham? He doesn’t know, but says it won’t be a mountain because of the altitude, but maybe Lourdes to Compostela? Just another target to keep fit! Well done Graham.

Contributed by: Graham McIvor

“Some achievements include, 1,000 days without LTI.”

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www.kcadeutag.com

Driving KCA Deutag’s vision to be recognised as the world’s most successful drilling and engineering contractor through measurable performance improvement, delivering safe, effective, trouble-free operations.

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