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DW Monday: FPSOs (2) Solutions for the Supply Chain

By July 7, 2014 November 28th, 2019 No Comments

DW MondayIn late April, we bought together twenty companies from across the FPSO supply chain to identify challenges and solutions for this sector. In a facilitated round table format, representatives from operators, FPSO contractors, EPCs, equipment manufacturers, and shipyards discussed the issues openly and suggested these solutions to FPSO development:

  • Fewer specifications: “We don’t need all the specs on these units. [Rather] we need to define what success is for the project” – FPSO Leasing Contractor
  • Clearer supply chain relationships: “We don’t want customers coming to us with a design from an engineering house and asking us to build it.” – FPSO Leasing Contractor
  • More standard designs and equipment: “There’s a lot more you can standardize on an FPSO than simply components” – Major E&P Company
  • Better relationships between contracting parties: “Some of the majors are going in the right direction – Shell and BP are implementing frame agreements. Chevron is also moving in the right direction” – Shipyard
  • FPSO contracts: “We need to work together in a more constructive environment. We don’t want the industry to be a fight and a scuffle” – Major E&P Company
  • Longer bidding deadlines: “Competition is important but timelines are unrealistic. They’re so short and it’s impossible to base bids on loose data” – Equipment Supplier
  • Increase proportion of company employees: “There are many contractors that are not affiliated with the company – they switch jobs frequently. The industry needs more permanent employees” – Equipment Supplier
  • Appropriate local content: “The problem is when you don’t have enough information [on local requirements, and need] to get more before you commit. It’s a lack of knowledge that’s the problem” – FPSO Leasing Contractor

Our thanks to the participants for your help in this effort. Please call or email if you would like a detailed summary of the findings from this engaging and informative industry round table.

R. Michael Haney, Douglas-Westwood Houston
+1 713 385 2588 or Mike.Haney@douglaswestwood.com