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Structural Integrity
Asia Pacific: Market

Analysis
An in-depth analysis into the market
conditions and challenges faced by
Structural Engineers in 2014
By Jamie Davies
Petronas, Pertamina, TWI, Bureau Veritas
Structural Integrity Gap Analysis
An in-depth assessment of the Workforce and Human
Resource challenges faced by Structural engineers
in the Asia-Pacic region
www.decomworld.com/decommissioning
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Design a robust Structural
Integrity Management (SIM)
program to ensure commercial
eectiveness and operational
longevity
Expert speakers from Petronas,
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and Talisman, as well as 120+ of
the regions leading structural
Engineers
Introduction:
Structural Integrity Management can now nally be conrmed as one of the most excit-
ing and innovative elds within the Oshore Oil and Gas industry. For a practice which
incorporates essential safety and business critical initiatives, it is truly surprising that it
has taken this long.
However long it has taken to realize the importance of such processes is now irrelevant,
as Structural Integrity Management is now at the top of the priority for the vast majority
of operators worldwide. That said, the advancement which said operators have made
varies greatly. The North Sea for instance has made substantial progress, recognized
throughout the community as leading structural integrity management practitioners
worldwide. This is a stark contrast to the Asia Pacic markets.
Here, well concentrate more on the market conditions and challenges presented to
structural engineers in Asia Pacic. Whilst there are substantial strides being made (a
faster rate of evolution than anywhere else), structural integrity management is still to
be rened as an art form.
Glossary of terms and acronyms:
SIM Structural Integrity Management
EOR Enhanced Oil Recovery
IOR Improved Oil Recovery
FPSO Floating Production Storage and Ooading (vessel)
RBI Risk Based Inspection
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Section One: Market Overview
Estimated number of ofshore locations
How does the Asia Pacifc region compare to the North Sea Continental Shelf?
Estimated number
of oshore
installations
India
262
Bangladesh
1
Vietnam
46
Thailand
265
South Korea
1
Phillipines
8
Papua New
Guinea
1
New
Zealand
7
Myanmar
9
Malaysia
249
Japan
1
Indonesia
485
China
144
Brunei
160
Australia
78
0
100
200
300
400
500
North Sea Continental Shelf
Asia Pacic
40+ 35-40 30-35 25-30 20-25 15-20 10-15 0-10
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As you can see here from the data, ageing assets are not a problem conned to the Asia
Pacic, though purely by the number of assets falling into each of the categories, it is
certainly an area of concern. In fact, when you actually consider the average age of each
the assets within each region, the North Sea Continental Shelf would appear to be in
worse condition (26.04 years compared to 18.03 in Asia Pacic), but this simply averts
the argument itself.
Operators in the North Sea markets are far more experienced and advanced when
considering SIM programs the average age should not be a concern here. What should
receive more attention is the pure number of assets which are operating beyond the
design life in the Asia Pacic markets. For arguments sake, well assume that the initial
design life is 20 years thats 784 (47%) platforms.
When you consider that SIM programs in the Asia Pacic region are not up to scratch,
this is certainly a worrying statistic. But how much of a priority has SIM been made in
the region?
Bureau Veritas Technical Director Gary Strong thinks it should be taken very seriously
by all operators There is obviously a mix of old and new assets out here, but on the
older assets the operators are trying various forms of Enhanced Oil Recovery (EOR) to
maximize the eld life, this is going to lead to platform extensions, removal and addi-
tion of equipment and changes in overall Center of Gravity and overall weight manage-
ment poloiciesetc. and so life extension should be pretty near the top of the list of main
considerations
But for those not considering life extension projects there could be some signicant
consequences directly impacting the commercial viability of the assets. Potential
structural failure of platforms or other structural assets reducing the eects of the EOR
program and potential for a signicant incident oshore, such as a Frankling Elgin or a
Piper Alpha type of incident.
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Another area of interest is the growth of EOR techniques and new innovations which are
now entering the market.
When you consider that traditional extraction techniques usually bring between 30-35%
of the oil available in a reservoir to the surface, there are huge commercial advantages
of investigating such innovations. Some have suggested that by EOR could assist in
extracting up to a further 20% of the reservoirs capacity combined with IOR technolo-
gies this would account for up to 75% of the reservoirs total volume.
Many operators worldwide are already incorporating such techniques into the opera-
tions for elds under operation, but with the vast increase in commercial eciency this
is an area which we should expect vast growth through the next 10-15 years.
Demand for EOR Market value of EOR

EOR techniques currently being applied
The market for EOR is estimated to be valued at $38.1bn (2013), however with antici-
pated annual compound growth rates of around 25%, this could increase to well over
$500bn this is certainly an area which has to be taken into consideration for SIM
programs. What eects will such techniques, by denition designed to prolong the life
of reservoirs, have on already ageing structures?
North America - 38.9% Europe - 9.5%
Asia Pacic - 20.7% Rest of World - 30.9%
Current
(2013)
$38.1bn
Estimated
2023
$500bn
0 10 20 30 40 50 60
Chemical EOR 10.3%
Gas EOR 38.2%
Thermal injection 51.5%
Percentage
T
e
c
h
n
i
q
u
e
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Another area of concern for structural engineers should be the growth of FPSOs not
only in the Asia Pacic markets, but worldwide. Structural integrity for FPSOs, most
notably hull and mooring line integrity, has been and will continue to be a major
headache. In essence, the silver bullet has not been found yet and there is an array of
technologies available to engineers to combat the challenge however it will continue
to press industry thought leaders.
Whilst FPSOs are still in the vast minority currently, there is certainly excitement in the
Asia Pacic markets. It would appear that such innovations could lead the way to vast
commercial gains through the next 10-15 years.
FPSOs in operation
FPSOs in planning stage
0
5
10
15
20
25
30
35
40
South
East Asia
Northern
Europe
Mediter-
ranean
India Gulf of
Mexico
China Canada Brazil Australia Africa
0
10
20
30
40
50
60
Gulf of Mexico Europe South East Asia Africa Brazil
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Section Two: Immediate challenges for Structural Engineers
Having discussed three of the growing industry trends impacting the Asia Pacic mar-
kets (its worth noting that these are only three of many), its important to understand
the real challenges and trends which facing structural engineers. How operators will
approach and execute SIM programs very much depend on the development of the
following themes:
The growth of risk based inspection programs
For some this would be considered evolution of common practices and to others it
would certainly seem like a revolutionary idea. Whilst there are still some parties who
are sticking with the timed inspection programs, it is clear that RBI is vastly more ef-
cient and benecial to already time-pressed engineers.
Basing the frequency of inspections against the condition of a structure rather than the
age would certainly seem like a logical step, though there are some barriers in place
before this could be described as a universally accepted technique. Whether it would be
regulatory obstruction, absent data or a lack of experience in the workforce, we are still
some way o the perfect system.
But how would you determine the risk prole of each of the individual structures?
Although it could appear to be a vastly complex initiative, each structure should be
graded against two pieces of criteria in the rst instance:

Probability of failure

Consequences of failure

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Whilst this would be considered a very simplistic approach, it can oer a clear risk prole
of structures to build a new strategy against.
But why have such initiatives not taken a more prominent role within the industry? The
answer is relatively simple regulation.
In short, regulation has not caught up with the practices of structural engineers in the
region. Organizations like Petronas, Pertamina and PTTEP all seem keen to move for-
ward with such initiatives, though there have been some restrictions due to the current
regulations in place. There is progress being made, though there is currently a ne line
between operating through the most ecient practice, and remaining compliant.
In my opinion, the benets of RBI will provide a positive benet to everyone involved
as you can focus your money on the assets which are high risk commented Sophia
Kangan, Structural & Project Engineering Lead at Pertamina.
You can tell with time based of course but you have to treat everything as equal. With
RBI you can dierentiate on technicalities, on its contribution to your company; you can
treat these assets on what is already dened.
Every asset has its own criticality, so we can keep the focus on the high critical, and
mitigate the risk immediately. We can treat each asset individually, dependent on the
risk.
Sophias points were also echoed by Bureau Veritas Technical Director Gary Strong. RBI
oers a more specic inspection locations and techniques looking for specic degrada-
tion mechanisms, also potential a greater frequency between inspections. Risk-based
focus looking at the most dangerous items rst them moving down the criticality list,
until the analysis cycle repeats
That said a lack of data, both structural for the platform and previous and current met-
ocean, recent inspection history, any damage or repair history, changes in process, basic
Change of Management over the many years of platform operations, can lead to some
pretty signicant roadblocks.
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Integrating met-ocean data into SIM programs
Whilst the 1000 Year Wave is certainly a popular phrase for any structural engineer at the
moment, as the name suggests, it remains highly unlikely. However, it has highlighted
the importance of using other forms of data to develop a robust SIM programs, most
notably, met-ocean data.
Incorporating scientic knowledge of wave systems is a relatively new concept, but can
oer great insight to how your structure will stand up against not only the 1000 Year
Wave, but more common occurrences such cyclones and typhoons.
Although still undervalued today, met-ocean data enables us to understand some com-
plex environmental situations which directly impact the condition of oshore assets:

Wave height and velocity

Impact of opposing wave systems on members

Force exerted by breaking waves

Resulting force of the largest wave crests

Force exerted on hulls of FPSOs

Changes in wind direction and the resulting changes to wave conditions

Although these are just a few of the areas which need to be taken into consideration,
there is currently a lack of support through regulation to account for such conditions.
MARIN is making some considerable progress in this area through the CresT Joint In-
dustry Project, along with a number of partners throughout the global community. One
of the most important questions which this initiative will address is What is the highest
(most critical) wave crest that will be encountered by my platform in its lifetime? For a
question which would seem so important to the long lasting health of the structure, it is
one which has still not been answered.
Whilst there are also other areas which are taken into consideration, TLP is one of the
main aspects. Already there have been three areas which have been specically identi-
ed as a potential cause of failure:

Tendon overload

Tendon slack

Wave loading on deck

MARIN believes that TLPs are sensitive to dynamic response, which can result in both
overloaded and slack tendon. The CresT JIP combines met-ocean wave modeling,
hydrodynamic and reliability knowledge to gain a greater understanding on how such
environmental occurrences can negatively aect the integrity of a structure. Integrat-
ing such practices into a proactive SIM program can greatly increase the reliability and
lifetime of assets in operation.
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Are API standards dated?
Another obstacle for the oshore oil industry seems to be a shift in standards whilst it
would not be considered a major shift by any accounts, the introduction of ISO requires
a shift in culture.
The introduction of ISO standards gives a substantially more in-depth view of the struc-
ture, taking into account more advanced engineering techniques and analytical prac-
tices. Whilst working to the API standards is not necessarily incorrect, the level of detail
is not provided to ensure that the structure is appropriately assessed. In essence, using
ISO standards can mean that previously assessed structures could be non-compliant
under new codes.
But will this have a major impact on the structural engineering community?
Not for the most part. Not for us in any case, I cant comment for the operators and the
OEMs however comments TWIs Ian Partridge Ive heard some moans, but these were
the same moans as when the API standards came in.
Its just the idea of change most people dont like the idea of change, dont forget its
a very conservative industry. The fundamental physics or the technologies underneath
the standards are the same its just changing the rules, as far as Im concerned the basic
knowledge is still the same.
Whilst the basic engineering fundamentals will not change, ISO presents more complex
algorithms and techniques to identify deeper lying structural inadequacies. This is sim-
ply another stage of evolution within the oshore oil industry, though it will impact the
approach taken to structural integrity management practice. How many non-compliant
assets are we going to unearth when using the new standards?
This is not the major challenge however; there will always be non-compliant assets ir-
relevant of how robust and ecient your SIM program is. Culture is more likely to be the
larger roadblock.
Yes, there are always new ideas, but you have to understand that this is a very con-
servative industry. Some of the more innovative stu will take time to come online Ian
continued.
The Asia-Pacic markets have one benet, though it is well disguised Its a young work-
force, unlike other regions around the world where theres a better mix of younger and
older engineers.
Younger engineers will work to any standards, so I dont think this is a massive issue
around this change, as long as the guys as ISO make sure that they are eectively com-
municating with the workforce here.
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This is also the same argument when applying new technologies and innovations as a
conservative industry, there can be some levels of pessimism. However, Ian thinks that
there can be ways around this:
The rst question which is always asked is Where has it been done before? Learning
from the North Sea and the Gulf of Mexico is a massive concept here. If its been done
in either of these regions the operators here (In Asia) will be quite happy with it. Do-
ing something new themselves is very unlikely to happen over here. There isnt a vast
amount of R&D as such. Theres a lot of research and development which you would
classify as validation of work from elsewhere, but not early adopters. This is cultural as it
is anything else no-one wants to do something which might not work.
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Compensating for absent data
When discussing any SIM program it is important to note that data is king. Without
relevant and accurate data, condition and structural health assessments cannot be
made. This is a very simple point, however absent data is one of the major challenges for
structural engineers.
But what are we dealing with such a dilemma in the rst place? There would appear to
be several reasons:

As SIM has not been prioritized in the past, data was simply not stored in an ef-
fective manner as there was a clear lack of understanding of the importance of
such information

Contractors are not being held to account for the means in which data is collated,
analyzed and stored. In regions such as Asia Pacic, there needs to be stronger
levels of accountability and transparency throughout the supply chain

With assets changing hands several times in its life time, this data can simply be
lost in transition

Without a standardized approach to documentation from contractors and opera-
tors, comparing, analyzing and storing data is an immensely dicult task

Structural integrity management remains a complicated process, but without the tools
to build an accurate and complete picture, this becomes an immensely dicult task. In
short, absent data is preventing structural engineers from making the most informed
decision when performing health checks and structural assessments
But what can we do as an industry to make sure that the approach to SIM is more than
best guess?

Enforce more rigorous regulations to ensure that data is being collated and
stored in an eective manner

Create a culture of accountability throughout the supply chain (both internal and
external) to safeguard that the appropriate measures are being taken

Standardize the means and documentation in which data is collecting, analyzed
and stored, throughout the region. There are too many variations making such
tasks inconceivably dicult

It is now the task of some engineers to ll in the holes and complete the picture for a
robust SIM program, but how is this being done eectively?
But how does absent data directly impact the eectiveness of SIM programs?
Data is the rst process out of 4 processes in the overall SIM programs. It is very crucial
to continue to the next processes for Data Evaluation, SIM Strategy development and
SIM program implementation commented Petronas Principal Structural Integrity Alex
Elpianto.
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There is no one answer to all cases of absent of data. The best is to get the understand-
ing of the data required to overcome certain issue and start working on it to make it
ready. The key word is knowledge.
Software is denitely a powerful tool in the Evaluation process especially in the non-
elastic zone to perform Progressive Collapse Analysis. However, the qualied engineers
to operate, model and analyze the results are the primary solutions for SIM Alex added.
Development of offshore
structures standards API, ISO,
NORSOK
API ISO NORSOK
API RP2A WSD
20
th
Edition
API RP2A LRFD
1
st
Edition
ISO CD 19902
Committee Draft
ISO CD 19902
Final Draft
ISO DIS 19902
Draft Standard
ISO 19902
Published
API RP2A LRFD
2nd Edition (2010)
API RP2A WSD
Supplement
API RP2A WSD
21st Edition
API RP2A WSD
Supplement 1
API RP2A WSD
Supplement 2
API RP2A WSD
Supplement 3 API RP2SIM
Norsok N-004 R1
Norsok N-004 R3
Norsok N-004 R2
Norsok N-004 R5
Norsok N-004 R4
31 DecomWorld SIM North Sea 2013
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Moving into the digital world
Despite the Oshore Oil industry being relatively conservative in nature, there are some
impressive new technologies entering the market place, eectively digitalizing certain
areas. Once again in some quarters these advances are being met with some pessimism,
though the drive towards commercial eciency demands progression in technical
implementation and assessment.
Online monitoring tools are one such innovation which is drastically improving the ef-
fectiveness of SIM programs. But why are such technologies needed? The simple answer
is that of knowledge irrelevant as to whether you operate through a RBI or time based
inspection program, youll only nd faults in the structures when you actually look for
them. Online monitoring tools are changing the rules of the game to ensure that faults
are known when they actually occur.
Whilst continuous monitoring of at risk platforms is clearly a benet, it might also be
worth taking into consideration the use of unmanned platforms.
Although unmanned platforms would not be considered the norm by any stretch,
trends show that there are now more in operation than ever before, with growth
expected to continue upwards. These assets can be more ecient from a commercial
perspective (costs are dramatically reduced when man power is removed), however the
simple challenge of not knowing when there has been a collision can be a headache.
Irrelevant whether a risk based or time based approach to inspection is adopted, with-
out a human presence on the platforms, a collision can cause signicant damage by the
time it is identied. This is obviously the worst case scenario; however it does present a
real problem, one which online monitoring tools can compensate for.
But what other areas can these tools assist with?

Design Verication

Foundation stiness

Wave loading

Collision detection

Air gap measurements

Of course there is skepticism, but there are a number of examples where advanced
monitoring tools can make substantial contributions to operations:

Provide a clear and convenient picture of the health of your assets almost instan-
taneously

Identify problems and inadequacies during and ahead of planned inspections to
oer a more proactive approach to maintenance and repair projects

Assist in avoiding catastrophic failures

Create a far more involved and exible SIM program
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Increasing deck mass and removal of idle/redundant equipment

To ensure that operators are moving from a reactive to proactive program, the impor-
tance of real-time and eective data cannot be underestimated.
Floating Production Storage Ofoading Vessels
As mentioned previously, the growth of FPSOs is certainly not an area which is going
unnoticed. New technologies such as FPSOs are ever increasing the protability of oil
companies worldwide and becoming a more popular venture for increasing production
across the board.
One of the areas which is of major concern are the moorings lines themselves, however
there are now also growing debates about the maintenance of the hulls. Hull structural
integrity is becoming increasingly recognized as a safety and business critical element
by operators.
But are structural engineer qualied to make these decisions? In short, there is a gap in
expertise. To most eectively combat the challenges of hull integrity, naval architects (a
new breed of engineer in the region) are required.
Another point which is worth noting would be the age of these assets to address this
argument, there are two sides:

These assets are already beyond their initial operating design life

FPSOs are increasingly staying on station for longer periods

As it stands, current operations are not sucient to compensate for such operating
periods. Some of the larger challenges here are driven by a basic understanding of some
of the key principles, but also the time in which these inspections can take (due to the
nature of FPSOs). For example:

Hull Inspection Competence not dened

Cargo tank inspection challenges - 95.5% of operators found cargo oil tank
inspections to be medium or dicult to carry out and taking more than 6 days,
some reportedly up to 23 days

Inspection criteria governed by Class CVI

Subsea hull inspection challenges access as well as competency

Lack of awareness of present available techniques or technology available on the
market to perform such projects

Due to strong growth predicted in the FPSO market these are challenges which have to
be addressed in the immediate future.
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Conclusion
As you can see there are still some substantial hurdles to conquer before we could con-
sider the Asia Pacic region in line with SIM practitioners in the North Sea, though there
is substantial progress being made in a very swift manner.
There seems to be a considerable shift in priorities and its obvious that operators are
starting to maneuver with the same mentality as those in the North Sea markets. Aside
from the safety and functionality concerns which are addressed through an eective
SIM program, the commercial gains are more than abundant when you take into con-
sideration the advances in oil extraction techniques. It is clear that there is a very bright
future for the oshore oil and gas industry in the Asia Pacic.
Each of the sections discussed in this paper are critical to the development of SIM in
the region, however due to the complex nature of integrated all these practices, we
can expect to see come challenges on the road. As with any process which would be
considered new, the techniques, individuals and variety of practices will need time to
bed in to become a uid function. The rst steps have been made, but there is still some
way to go.
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All of the contributors in this white paper will also be speaking at the Structural Integrity Man-
agement Summit, Asia-Pacic.
At Asias rst Structural Integrity Management conference, youll benet from:

Learn how you can avoid common roadblocks through practical Age Management case
studies from regional and international SIM leaders including Petronas, Pertamina and
Talisman

Understand what online and real time data monitoring systems are entering the market
to ensure your SIM programs are being run the most time ecient manner

Evaluate how ISO standards will impact current operations and what you should look for
to ensure your structure is not non-compliant under new design and maintenance codes

Review all the environmental factors which could impact the integrity of your structure
and how leading Structural professionals are compensating for the 1000 Year Wave
Other expert speakers include:

By downloading this report you are also entitled to an exclusive $100 discount to attend the
meeting. Simply go to https://secure.decomworld.com/structural-integrity-management-asia-
pac/register.php and enter REPORT100

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