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New technologies - the cost comparison conundrum

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Oilfield Technology,

Danny Constantinis, the Executive Chairman of EM&I, discusses the cost comparison conundrum associated with new technologies in the oil and gas industry.

One of the principal problems of getting new technologies accepted, is being able to compare the costs with traditional techniques, which usually involve consequential costs, such as safety preparations, off-hire, cleaning, plant shutdown, dive or maintenance teams, weather dependency, POB costs, and the time required to complete the work.

These consequential costs are often far higher than the actual direct costs of doing the work, but operators are so used to them that they consider these part of 'normal operations.'

Robotic and digitised methods often avoid many of these consequential costs, but at first sight may appear to have a higher direct cost than traditional methods, and it is difficult for operators to carry out a true 'overall cost benefit analysis', which would then reveal the true and very substantial cost benefits.

Operators are focused on improved safety, which is a vital benefit of robotic and digitised methods but is also difficult quantify.

For example, new technologies such as the EM&I ODIN diverless UWILD, and NoMan remote confined space inspection technologies, which have emerged from the JIP (Joint Industry Project) for HITS (Hull Inspection Techniques & Strategy), have been shown to deliver over 50% cost savings, as well as improved safety, by reducing risk to divers, working at height or putting people into confined spaces.

There has been a natural conservatism in the oil and gas industry, but this is disappearing with the need for permanent improvements in safety and cost reductions demanded by stakeholders, and perhaps it is time for a joint industry effort to assess true safety and cost benefits of innovative methods, and provide guidance to operators on the relative merits and 'business readiness' of emerging technologies 

This is a step change for the offshore oil industry to embrace these new technologies, which are more efficient, effective, and safer than traditional techniques. The attendance at the recent FPSO Research Forum, which EM&I hosted at their Technology Centre in Cumbria, and was the first ever in the UK, broke all records, and demonstrated the tremendous interest in the new technologies.

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