Out Of The Frying Pan

After four years at Independent Project Analysis (IPA) I’ve moved back into the oil industry. Truth be told, I never really left, but for the past four years or so I’ve been working at IPA as a project analyst. This role has given me (and my former colleagues) the rather unique opportunity to watch oil and gas projects as they evolve from the early stages of planning through execution and ultimately start-up. For those that are familiar with the TV programme Grand Designs, the analogy I often use should explain it well. Essentially an IPA project analyst is like being the Kevin McCloud of the industrial world. Like many of the houses being build on that programme, it turns out that many oil and gas projects might have a firm idea of how much it will cost and how long it will take before they start, but few of them achieve their goals. Which is where IPA comes in. Through statistical analysis of data from hundreds of oil and gas projects, IPA has been able to develop an insight into what drives successful projects, and what is likely to lead to failure. Armed with this knowledge it’s usually pretty clear when a project is headed for disaster before it even begins.

Into The Fire

My new job is with the small but promising oil and gas venture Twinza Oil. The main asset is the Pasca A gas-condensate field in Papua New Guinea which is under development, having started FEL 2 around about the time that I joined the company. One of my roles is to be involved in delivery of the project, and ensure that the project delivers the optimum commercial value to the business.

Given my recent work with IPA which involved gaining insight into the various tradeoffs between cost, schedule and operability targets that a project may set, one might think that this should be a straightforward task. Sadly the reality is that my IPA experience merely makes me more aware of all the potential pitfalls. It is going to be a daunting task ahead, but one that will allow me to finally get to put much of what I have learned about oil and gas asset development into practice. At the end of the day it’s easy to be a pundit sitting on the sidelines; far harder to take your own medicine and make the tough decisions.

The First Week

I’m sure many of my former colleagues will be interested to know what life is like at a small E&P company in comparison to life at IPA. Firstly I can safely say that it has been busy since the moment I stepped into the office. One of the bigger differences so far is simply the number of meetings that I’ve had in a single week compared to my previous job. Essentially there are a large number of contractors, vendors, stakeholders etc. and with a small team of just six people in the office, there is an awful lot for each person to do. The biggest challenge is ensuring that nothing falls down the cracks.

So what have I actually done? Can a new team member just joining the company be expected to contribute straight away? My answer is, “absolutely”. Documentation is a key part of any project, and we’ve made a start on this, which has meant I got to start contributing to the project from the very first day. Not only that but there is important ‘networking’ to attend to as well.

  1. IPA research indicates that one of the strongest drivers of successful project outcomes is having clear business and project objectives. So naturally I’ve described these for the Pasca A Development Project, with realistic quantification of targets and goals. It didn’t take very long, but I was surprised by how difficult it is to determine exactly what numbers to use in describing some of the targets.
  2. A key document for any project is the field development plan (FDP). These documents can run to well over a couple of hundred pages, and at the start of last week ours was running to precisely zero. Several meetings and workshops later, during which the content and responsibility for various sections of the FDP was agreed, I’ve made a start writing up all the project and facility sections. It makes a change from reading them, and for all the despair I may have had in the past at how long it takes to read through the document, I guarantee you it pales to insignificance next to writing it.
  3. Pre-FEED engineering needs to start soon if we are to keep to the some of the milestone dates we have identified. Of course everyone knows that late changes to scope will lead to cost and schedule overruns, so before we can award the pre-FEED contract we need to make sure that the basis of design (BOD) is squared away. Fortunately this update work had already been started before I joined, so my involvement was simply to review/refine and then participate in meeting with the engineering contractor to discuss the changes. The biggest thing I learned through this process was that everything I had suspected at IPA about design codes driving heavier and more expensive designs appears to be true.
  4. All IPA project analysts know that soils and permits are two classic areas that will trip up projects if their planning is deficient. It was great to see that the project has already conducted a very comprehensive site survey and shallow hazard investigation. However this is by no means the end of the story, and there was yet another meeting with a survey contractor to discuss potential vessel availability for environmental baseline surveys, geotech and metocean.
  5. In the background the whole week was the realisation that there were many tasks ahead of us, but we didn’t have an integrated schedule which could tell us whether or not our planned target dates were feasible. No worries, we’ll create one. It’s sad that within an afternoon I had managed to create an FEL 2 schedule that was already more comprehensive than some other projects I’ve seen, with most of the activities networked. Resource loading wasn’t possible however. Not because I couldn’t be bothered – I really want to know whether our resources are sufficient – but we don’t have Primavera and the schedule tool we’re using doesn’t seem to handle resource loading properly. Something to address in the future…
  6. The reservoir side of the project hasn’t been forgotten either. During the week we met with a potential reserve auditor to investigate how they could help deliver a reserve certificate on a schedule that met our plans.
  7. Most importantly it’s clear that it’s not all hard work at Twinza. Evening activities have included a SEAPEX meeting where in between the beers I caught up with not just some old acquaintances from the industry, but even an old acquaintance of my parents (they had all worked together many decades ago). I was also invited to watch the Brazil-Japan friendly soccer match that was hosted in the new Singapore stadium. For those of you that know me it won’t be a surprise that I had no idea who the big name players were, but some chap called Neymar scored four goals and quite a few fans were delighted.

So all that is just the first week. I suspect it’s going to be an exciting ride as this project continues towards FID and onto first gas.

Oh, and supposedly I’m supposed to be helping with our other assets too…

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