There’s not a quick fix solution to the range of issues currently facing the subsea industry. Short–term measures and knee-jerk cost-cutting may have worked in previous downturns, but this time we must take a long-term approach and implement fundamental changes that will deliver lasting results.
That’s why the theme for Subsea Expo 2016 is “Time for Transformation”. This week will be about turning the rhetoric into action to safeguard the future of the UKCS and the country’s £9billion subsea industry.
The conference will explore the fundamental behavioural changes the industry must make to deliver the cost reduction and widespread efficiencies needed to secure and define our future.
As one of the world’s most mature and complex basins, operating in the UKCS was becoming increasingly challenging long before the oil price crashed. If we are to maximise economic recovery, implementing transformational change quickly and effectively will be key.
The UK still boasts the single largest concentration of subsea capability and excellence in the world. Our challenge is to maintain that position in the face of the current low oil price and increasing global competition. This means we need to stop talking about working together and actually do it so that we can be smarter, more efficient and quicker at developing new technology.
Subsea techniques and technology were largely honed in the North Sea in the eighties and for many UK subsea companies this province continues to be their biggest market. However, with fewer discoveries and ageing fields, this market will reduce in significance in the medium to long-term with larger, emerging provinces coming to the fore.
However, right now there are still significant opportunities in the North Sea. We need to squeeze more from our existing assets. For subsea this means a focus on integrity and production assurance with the aim of maximising financial returns on subsea assets over their operational life.
The transformation must lie in changing the way we work to simplify, standardise, co-operate and collaborate. It’s also about recognising that everyone in the supply chain has a role to play. Those who don’t engage will not survive.
With a focus on innovation and technology, the pioneering subsea industry is well-positioned to influence different, more effective ways of working together to increase efficiency, optimise production and reduce the cost per barrel.
The up-turn is going to take much longer than anticipated and the oil and gas landscape, particularly in the North Sea, will not be the same again. But the subsea sector’s ingenuity and can-do attitude, for which we are renowned around the world, will play a vital role in making sure we are ready for the future.
Subsea UK is leading the charge for change through its role as the voice of the sector, engaging the whole supply chain in collaboration and influencing the decision-makers in industry and politics.
Subsea Expo provides an opportunity for the industry to come together, discuss their subsea challenges and work towards a common goal. We are looking forward this week to hearing about all of the great things that companies are doing to ensure that we have a strong future in the North Sea and our leading position in the global market is maintained.
With so many of the globe’s leading subsea companies under one roof, the conference has fast become the best place to hear about what’s going on in the sector. Despite the climate, numbers of attendees at Subsea Expo are up on this time last year and I am confident we are going to have a great show.
My optimism stems from the fact that the UK’s subsea sector is prepared to roll up its sleeves and find the best way forward. With our back up against the wall, we are going to come out fighting.
Neil Gordon is Subsea UK’s chief executive and this week’s Energy Voice guest editor.