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forum
A magazine from DNV no 01 2012
FOSNAVÅG: Small
community - big impact
KONGSBERG:
Corporate responsibility
YARA:
Feeding the world
+
LOOKING TO
A BRIGHT FUTURE
OLA BORTEN MOE
NORWAY’S MINISTER OF
PETROLEUM AND ENERGY

12 – no 01 2012
MAJOR OIL AND GAS ACCIDENTS IN THE PAST FEW DECADES HAVE FORCED
SIGNIFICANT IMPROVEMENTS IN TECHNOLOGY, PROCEDURES AND REGULATIONS.
“NOW, WHEN SEEKING OPPORTUNITIES IN THE ARCTIC AREAS WE MUST ENSURE
THE SAME LEVEL OF RISK AS IN THE NORTH SEA,” EMPHASISES KNUT ØRBECK-
NILSSEN, DNV COO DIVISION NORWAY, RUSSIA AND FINLAND.
TEXT: SVEIN INGE LEIRGULEN PHOTOS: DAMIR CVETOJEVIC
il and gas producing countries have experienced several catastrophic accidents
in the past 30 years. Alexander L. Kielland in Norway, Piper Alpha in the UK,
Montara in Australia and Deepwater Horizon in the US have all claimed many
lives or caused significant oil spills.
Mr Ørbeck-Nilssen explains that another common characteristic with all these tragedies
is that they were completely unexpected. However, they have forced the development of
improved procedures, standards and technologies. On the regulatory side, responsibilities
have become clearer and new governmental safety agencies have been established.
“Offshore safety has never been so high on the public agenda as in the past year. The
industry is debating how to improve technologies and safety solutions, and authorities in
both the US and the EU are developing stricter requirements for oil and gas operations.
There is no doubt that the rules of the game will change with more focus on offshore
safety, environmental protection and risk assessments,” he predicts.
RISK MANAGEMENT ENHANCES SAFETY
“The use of a risk management approach is vital to increase safety. We should not confuse
the risk of a certain event taking place with only the consequences it may result in.
That is not taking into account the likelihood for the event to occur. This approach, the
so-called ‘worst case scenario’ will lead to many decisions without a sound factual basis.
“This is not what risk is about. Risk management is about increasing safety by analyzing
what and where something can go wrong, minimising the probability for it to occur and
ensuring that you can reduce its consequences,” he clarifies.
An oil and gas operator who embraces this approach within its management system will
be able to enhance and manage safety levels, continuously. Authorities that base their
regulations on a risk based approach will also have a pragmatic tool that enables them
to decide on an acceptable level of risk for their countries to harvest resources. This also
provides the basis for regulations that allow for technology development and new and
better solutions. Risk analyses will further provide a common interface for discussions
between stakeholders, for example regarding a decision of whether or not to allow an
industrial activity.
no 01 2012 – 13
DNV HAS BEEN INVOLVED IN THE LNG INDUSTRY SINCE THE 1960S, AND THE COMPANY IS WORKING
ON PROJECTS RIGHT ACROSS THE SPECTRUM OF LNG ACTIVITIES. TODAY, LNG IS ONE OF THE FASTEST GROWING
ENERGY MARKETS AROUND THE WORLD. GIVEN THE NUMBER AND SCALE OF NEW LNG PROJECTS PROPOSED OR
UNDER CONSTRUCTION, GLOBAL PRODUCTION CAPACITY COULD MORE THAN DOUBLE BY THE END OF THE DECADE.
DNV IS WORKING HARD TO SHARE ITS COMPETENCIES WITH CUSTOMERS AND THE INDUSTRY, ENSURING
LNG REMAINS A VIABLE, COST-EFFECTIVE AND SAFE ENERGY SOURCE.
nother expanding area of business Compared to other fuel sources, LNG is to help with studying the distribution of
for DNV concerns the growth of good for the environment and – with the LNG, and we share our experience with
the Arctic region. The United developments being made here – good for other countries in the Nordic region. We
States Geological Survey believes that the Norwegian business. For example, DNV have also met with the EU commission
Arctic seabed contains nearly 20% of the has come with many new concepts for LNGfuelled
ships, such as Triality, a concept for on our experiences and advise on how to
and with the Russian government to pass
world’s oil reserves and 30% of its gas
reserves. Add to that the fact that ships will new, energy-efficient tankers. DNV has extend the use of LNG.
soon be able to sail across an open Arctic taken a lead in this area, and research
Ocean during the summer months, and it programs such as these are on-going
What is being done to raise the knowledge necessary
to develop infrastructure for distribution
is no wonder DNV expertise in Arctic matters
is so sought after.
and refuelling terminals on a global basis?
throughout the country.
With these two issues very much in the Norway already has a leading position in the use
spotlight, DNV Forum decided to take the of LNG as a fuel, such as on ferries and supply Norway has, alongside other countries and
opportunity to speak to a key player on ships. What explains Norway’s pioneering role in maritime operators in Northern Europe,
these topics. Rikke Lind, a Norwegian politician,
was appointed in 2005 to the posi-
at the distribution of LNG as a marine fuel
this area?
financed a feasibility study that is looking
tion of State Secretary of the Norwegian We have a long heritage as a maritime in ports around the North Sea and Baltic
Ministry of Trade and Industry. Due to nation, and over recent decades we have Sea. Once this study is complete it will
Norway’s prominence in the shipping industry,
ownership of oil and gas resources and Combining the capabilities of these two therefore the decision-making process, for
built our competence in the energy sector. undoubtedly improve the knowledge, and
location close to Arctic waters, Ms Lind is disciplines, it is no wonder we are now taking
a global lead.
panies that are considering LNG as a ship
the authorities, ports and shipping com-
often involved in these issues both domestically
and internationally.
The three main efforts that explain fuel.
Norway’s pioneering role in environmental Much of this understanding is being
THE FUTURE OF LNG
shipping are: The NOx Fund; LNG a fuel gained through the pioneering work in a
Norway has taken the lead developing the “LNG on ferries; and the use of LNG as fuel on number of ports, and the report highlights
as fuel” concept for shipping. What development some offshore vessels.
these as examples that others can benefit
do you see here in a global perspective?
The Norwegian government also has from. A project being undertaken at the
an important role to play. We did work LNG terminal in Gothenburg is an exam-
20 – no 01 2012
TEXT: RICHIE MACTAGGART PHOTOS: NINA E. RANGØY
I “Compared to other fuel sources, LNG is good for the environment and – with the developments being made here – good for Norwegian business,” says Rikke Lind, State
Secretary of the Norwegian Ministry of Trade and Industry.
no 01 2012 – 21
Content
01 2012
FORUM 01.2012
PUBLISHED BY
Det Norske Veritas as
NO-1322 Høvik, Norway
Tel: +47 67 57 99 00
Fax: +47 67 57 91 60
EDITOR
Eva Halvorsen
Tel: +47 67 57 97 19
eva.halvorsen@dnv.com
DESIGN AND LAYOUT
Coor Service Management as/
Coor Design
graphic.services@dnv.com
PRINTING
Grøset Trykk AS, 12 000/ 2012
COVER PHOTO
© Statoil
02 Editorial
03 News
11 President Zuma discussed
carbon capture at DNV
12 DNV COO Knut Ørbeck-Nilssen:
Low risks in the North?
16 Norway’s Minister for Petroleum
and Energy:
An industry for the future
20 State Secretary of the Norwegian Ministry
of Trade and Industry, Rikke Lind:
Two topics, one voice
24 Statoil’s Ingbjørn Refsdal:
Statoil step change gets noticed
26 Fosnavåg – A small community with
global impact:
28 Mayor Arnulf Goksøyr:
Defined by the sea
30 CEO of Olympic Shipping Stig Remøy:
“If you can’t dream it,
you can’t make it”
32 Founder of Havila Shipping Per Sævik:
Living an adventure
+ Arctic operation
LOW RISKS
IN THE
HIGH NORTH?
34 Gassco’s Thor Otto Lohne:
Towards new ownership on the
Norwegian continental shelf
36 CEO of Oceansaver Steinar Riise:
Under the waves
38 CEO of KONGSBERG Walter Qvam:
A value-based technology leader
42 Yara’s Tore Jenssen:
Feeding the world
46 Executive chairman of Cool nrg Nic
Frances: A green light on the horizon
50 Kuwait Petroleum International’s Fouad
Qabazard:
Searching for the ideal process
53 Deepwater technology centre
in Singapore
54 Norwegian Sea Rescue:
Safeguarding life at sea
58 Carbon Trust’s Benj Sykes:
Creating “innovation that delivers”
62 President of NACE International
Oliver Moghissi:
Drawing the corrosion-risk picture
64 Last word of John Tiratsoo:
Pipeline research: Where next?
+ LNG
TWO TOPICS,
ONE VOICE
© Det Norske Veritas as, 2012
O
A
12
20
DNV COO Knut Ørbeck-Nilssen:
LOW RISKS IN THE NORTH?
State Secretary of the Norwegian Ministry
of Trade and Industry, Rikke Lind:
TWO TOPICS, ONE VOICE

Through its operations on five continents, Norway-based KONGSBERG is continuing to expand its reach, product range and distribution systems
into new and existing markets. With the aim of further strengthening its international operations, the Group is well equipped to provide 24/7
customer service, technical support and distinctive high-end systems and products. The Group employs close to 6,500 people and has offices
in more than 25 countries.
38 – no 01 2012
TECHNOLOGY KNOW-HOW, STRONG CULTURE AND INTERNATIONAL FOCUS ARE MAJOR FACTORS PROPELLING
THE EXPANSION OF KONGSBERG, THOUGH ACCORDING TO PRESIDENT AND CEO WALTER QVAM, INNOVATIVE THINKING
AND MARKET CREDIBILITY ARE ALSO IMPORTANT FACTORS.
TEXT: STUART BREWER PHOTO: NINA E. RANGØY
that the Group is maintaining a high level “It’s all about delivering systems that help
of activity in virtually all key segments. The the operator make the optimal decisions
order backlog remains stable at a high level or run the optimal operations – by always
and ongoing efficiency measures are supporting
continued profit levels. Further, able in the control room environment –
having the full operational picture availtainties
related to the global economic
situation are everyday challenges facing our market shares are continuing to grow at sea, in space or during defence operations,”
points out Mr Qvam.
global companies.
and we are working on significant new
To KONGSBERG, a technology corporation
that is one of the leading suppliers have great potential. This combination people, technology and dedication –
business and technology opportunities that “Our vision – World Class – through
of sophisticated systems and products provides a robust commercial platform forms the basis of our ambition. We have
to the maritime, oil & gas, space and for KONGSBERG, and this is particularly described our value proposition as ‘Extreme
defence industries, these challenges also important for us given the uncertain global performance for extreme conditions’
represent opportunities. “KONGSBERG market situation.
because KONGSBERG’s solutions are often
has grown significantly, mainly through “All businesses have a desire to grow used by operators that undertake complex
product development, global expansion
and key acquisitions, as well as – and these are important drivers for Mr Qvam has definite views on how
and improve their financial performance and challenging tasks in difficult situations.”
through competence development,” says KONGSBERG too. However, for us, the KONGSBERG is to further its standing in
Walter Qvam, the President and CEO of ability to adapt quickly and deliver innovative
systems, products and services that and even strengthened focus on quality,
the marketplace. These include a continued
KONGSBERG. “This has served us well
and our strong focus on collaboration improve safety, security and efficiency are research and development and internationalisation.
“We also place great empha-
with our customers and being seen as a equally important,” emphasises Mr Qvam.
very reliable organisation has been, and
sis on the importance of the KONGSBERG
will continue to be, key for us.”
FULL OPERATIONAL PICTURE
culture, and our values and ethical standards
describe how we should work and act
KONGSBERG’s performance in recent KONGSBERG is continually developing
years is a story of growth in revenues as its position as a high-end supplier of systems,
products and services to its custom-
He continues: “Our future growth
to achieve our ambitions,” he says.
well as in profitability. “Our progress has
been steady and almost all our areas have ers. “Although delivered to very different and business strategy are centred around
improved in recent years,” says Mr Qvam. industries, there is a strong commonality this framework and focus on a strong performance
culture, partner “Our second quarter results this year show in KONGSBERG’s systems and products.
collaboration,
I KONGSBERG Maritime’s K-Bridge integrated bridge system including ECDIS electronic chart display, ARPA radar, propulsion control system and conning display.
no 01 2012 – 39
42 – no 01 2012
WITH LESS ARABLE LAND AND MORE PEOPLE TO FEED IN THE WORLD,
THE SOLUTION LIES IN NEW TECHNOLOGICAL SOLUTIONS AND IMPROVED AGRICULTURAL PRODUCTIVITY.
TEXT: JANNICKE WITSØ PHOTO: NINA E. RANGØY
I Yara is the world’s largest supplier of mineral fertilizer. “Using the best agricultural practices is key to ensuring a food supply for the growing world population.”
no 01 2012 – 43
54 – no 01 2012
NORWEGIAN SEA RESCUE IS KNOWN
TO BE THE ORGANISATION
THAT GOES INTO BAD WEATHER
WHEN OTHERS LEAVE IT.
TEXT AND PHOTOS: CHRISTINA SMEBY
no 01 2012 – 55
© Damir Cvetojevic
+ Corporate responsibility
+ Management systems
+ Sea rescue
A VALUE-BASED
TECHNOLOGY LEADER
SAFEGUARDING
LIFE AT SEA
KONGSBERG in brief
hroughout the world, most industries
are in a state of transformation.
Tincreasing competition, new technologies,
global value chains and uncer-
FEEDING
THE WORLD
38
42
54
Kongsberg:
A VALUE-BASED TECHNOLOGY LEADER
Yara’s Tore Jenssen:
FEEDING THE WORLD
Norwegian Sea Rescue:
SAFEGUARDING LIFE AT SEA

+ Editorial
BALANCING TWO
PERSPECTIVES
The recovery from the financial crises that started in 2008 is slow. Some
parts of the world have come out of the crisis already, but Europe and the
US remains hard hit. We know that the crises will be over one day, and we
look for positive signals that we are on the way to recovery.
In the meantime we see increasing unemployment in many countries, low growth rates, large
reductions in public spending, and volatile financial markets in Europe and the US. The rest of
the world is fearfully following these developments, acknowledging that their consequences
may very well have a global impact.
At the same time, we have for some years been witnessing an emerging climate crisis. In
December, world leaders were gathered in Durban at the COP 17 talks. Few people are optimistic
that the two degree target is within reach. During the World Petroleum Congress in Doha, also
in December, it was evident that there is an abundance of oil and gas reserves, and that these
fossil fuels will remain the main source of energy throughout the next several decades. Consequently,
we will continue to experience the effects of climate change, such as more extreme weather
and natural disasters. This means that adaptation to climate change will be an important focus
in the years to come.
We are facing these two very different crises at the same time; both of which have to be dealt
with. The financial crisis has a short perspective and the politicians are working hard to bring us
into smoother waters. The climate change issue, however, has a much longer perspective.
Balancing these two perspectives is a huge leadership challenge, both within the business and
the political arenas.
Many large companies, including DNV, are in good shape because they have taken strong medicine
in the past two years. But the troubles facing the government finances have also impact on
trade and businesses. For shipping, this will mean more problems on top of those arising from
the over-contracting of ships up until 2008 – ships that are now hitting the water. However,
shipping is a global and cyclical industry, and I am convinced that the growing global need for
energy and commodities combined with reduced newbuilding activity and increased scrapping
will bring the world fleet in balance in 2-3 years’ time. In the current business environment, the
response from DNV is to focus on continued cost-efficient and high-quality classification services
and to provide advice and support to our maritime customers and other stakeholders.
HENRIK O. MADSEN
Chief Executive Officer
Regarding the oil and gas industry we aim to become a world leading risk management service
provider in challenging operational environments. In addition to this we recently acquired 74.3%
of the shares in the Dutch company KEMA thereby creating a world-leading consulting and certification
company within the cleaner energy, sustainability, and power generation, transmission
and distribution sectors. By this move we will meet the needs of an industry in rapid transition
and growth. The combination of cleaner fossil-fuel-based power generation, the increased use of
renewables and the growth of electricity as an energy carrier will truly make a global impact.
In our quest to have an impact on the low carbon economy we see that industries worldwide are
recognising climate change as a serious societal problem. More and more companies are realising
they are expected to contribute to finding solutions and act in a responsible and responsive manner.
We are positioned to assist them living up to these expectations.
2 – no 01 2012

+ News
The HS Chopin is a 3,500 TEU container vessel owned by Hansa Shipmanagement in Hamburg.
THE HS CHOPIN BRINGS
DNV NAVIGATOR TO 2000
DNV Navigator No. 2000 has now been installed on the HS Chopin. The event took
place while the 3,500 TEU container vessel visited the port of Hamburg. Navigator is a
software package that simplifies port clearance procedures and ensures that the crew
has the information needed for any port in plenty of time before the ship arrives
there. The system has been recognised by the industry as the tool that offers the
most comprehensive and all-in-one database, with worldwide port information, regulations,
procedures and port clearance forms.
The final handover from DNV to the owner was managed by Lawicki Marek, the
master of the HS Chopin, and Jörg Langkabel, DNV Country Manager, Germany.
“Through developing guidelines and standards for CCS
in collaboration with governments and industry, DNV
has taken an instrumental role in paving the way for
the safe and cost-effective deployment of CCS,” says
DNV COO Division Americas Elisabeth Tørstad.
+ THE WORLD’S FIRST
CERTIFICATE OF FITNESS
FOR SAFE CO2 STORAGE
DNV AWARDED THE WORLD’S FIRST CERTIFICATE OF
FITNESS FOR SAFE CO2 STORAGE TO SHELL’S QUEST
CARBON CAPTURE AND STORAGE PROJECT.
DNV has issued the world’s first certificate of fitness
for a CO2 storage development plan to Shell’s Quest
Carbon Capture and Storage (CCS) project. The proposed
Quest project will capture and permanently store
underground more than one million tonnes of CO2
per year from the Scotford Upgrader, located near Fort
Saskatchewan in Alberta, Canada. Together with industry
and governments, DNV has recently developed
recommended guidelines and best practices for CO2
geological storage selection and risk assessment.
RECOGNISED AS A GLOBAL LEADER
IN SUSTAINABILITY ASSURANCE
DNV was rated as a global leader in the sustainability assurance market in a study carried
out by the independent analyst firm Verdantix. The overall breadth and depth of
DNV’s assurance services and proven expertise were considered to be among the best
in the sustainability assurance market.
According to the study, DNV is one of the six leading providers in the global sustainability
assurance market.
“Being ranked as a leading international provider of
sustainability assurance services is a strong recognition
of DNV’s focus on business development in this area
for several years. Our proven capabilities will constitute
the best basis for increased customer awareness of DNV
in the market place,” says Antonio Astone, Global
Product Manager for Sustainability Assurance Services
in DNV Business Assurance.
no 01 2012 – 3

+ News
POSITIONING FOR THE ARCTIC
The Sustainable Arctic Marine and Coastal
Technology research centre at the Norwegian
University of Science and Technology (NTNU) in
Trondheim has opened.
This centre for research-based innovation has been
sponsored by the Norwegian Research Council, DNV
and several international oil companies.
“There is great optimism about industrial developments
in the northern seas. Developments and industrial activity
are very likely to take place in the years to come,”
says Knut Ørbeck-Nilssen, COO Division Norway, Finland
and Russia.
Knut Ørbeck-Nilssen,
COO Division Norway,
Finland and Russia.
+ WORLD’S LARGEST HEAVY LIFT VESSEL
DOCKWISE’S NEW HEAVY LIFT VESSEL, THE DOCKWISE VANGUARD, WILL BE ABLE TO LIFT
AND TRANSPORT UNITS OF UP TO 110,000 TONNES. THE MAXIMUM CAPACITY OF AN
EXISTING VESSEL IS 75,000 TONNES.
With its width of nearly 80 metres and length of 275 metres, this is the first semisubmersible
heavy lift vessel to be built in accordance with DNV’s new class rules for this
type of ship. The vessel has no forecastle, which allows it to carry cargo of “unlimited”
length. Its deckhouse is mainly positioned outside its hull, allowing it to carry 70 metre
wide cargo. The vessel is going to be built by Hyundai Heavy Industries in Korea, due
to be delivered in October 2012.
As DNV is perceived to be the leading class society when it comes to heavy lift vessels,
and as Dockwise is a front runner within heavy lift vessels, the two organisations have
cooperated to ensure this new innovative vessel meets all the safety standards.
© Dockwise
+ DNV SUCCESSFUL IN THE TANKER SEGMENT
DNV’S STRONG MARKET SHARE OF THE GLOBAL OIL TANKER ORDER BOOK IS 25.5%
(GRT). DUE TO THE MISERABLE FREIGHT MARKET, THE ORDERING ACTIVITY FOR OIL
TANKERS IS EXPECTED TO REMAIN LOW.
DNV’s strong market share of the global oil tanker order book is 29.9% (grt). Due
to the miserable freight market, the ordering activity for oil tankers is expected to
remain low.
Of the current global order book of 25 shuttle tankers, 19 are to be built to DNV class.
DNV has been equally successful in the LNG market, where 20 out of 48 new LNG
ships ordered globally this year are to be built to DNV class, all in Korea. Some of
the orders have associated options, so these figures may increase.
The wave of new orders this year is a consequence of the expected demand for more
LNG-carrying capacity in the years to come.
“DNV’s strong position in the shuttle tanker market reflects the fact that DNV has been
extensively involved in this highly specialised oil tanker sector right from the start in
the North Sea in the 1970s,” says Jan Koren, DNV’s Business Director Tankers.
4 – no 01 2012

+ News
LARGE SCALE INTEGRATION OF WIND ENERGY
DNV leads newly established R&D network addressing large scale integration
of wind energy
The objective of the network is to address key risk elements for the grid investments
that will be required to integrate large amounts of wind energy into the transmission
grid. The initiative is funded by Nordic Energy Research, and consists of four leading
universities; NTNU, KTH, CTH and Risø / DTU, STRI, Statnett and DNV.
“Efficient integration of renewables is a key aspect
when moving into a low carbon future,” says Kjell
Eriksson, vice president and head of DNV’s energy
research activities.
“Offshore wind parks are planned with capacities far exceeding what we have seen
so far. In order to accommodate the EU 2020 target up to 40 GW of offshore wind
power may be installed in the North Sea requiring grid investments in the order of
11–28 billion Euros,” says Kjell Eriksson, vice president and head of DNV’s energy
research activities. “Over-investing will lead to increased cost of electricity, while
under-investing may result in a net without the expected reliability and robustness.
A risk-based approach is therefore needed to find the right balance.”
“We are now able to provide the most complete set of
risk-based software for operational integrity management
and asset integrity to the energy, maritime and
healthcare industries,” says Are Føllesdal Tjønn, managing
director of DNV Software.
DNV HAS BOUGHT
SOFTWARE COMPANY
SYNERGI SOLUTIONS
DNV has acquired Synergi Solutions, thus enlarging
its software portfolio extensively and gaining 30
new employees.
As a leading provider of asset integrity software for the
energy and maritime industries, DNV is now extending
its portfolio to include risk-based software for operational
risk management. Quality, Health, Safety and
Environment (QHSE) is a field that is growing increasingly
complex in many industries, and recognised systems for
managing these risks are vital.
+ DNV WINS
BRONZE
AWARD IN
PRESTIGIOUS
INTER-
NATIONAL
GREEN
AWARDS
The Green Awards are
well respected and internationally
recognised as
the benchmark for global
excellence.
“Sustainability has been
singled out as an area
where DNV aspires to
take a leading future
position and this award
well reflects DNV’s
growing status in this
important arena,” says
Bjørn K. Haugland COO
DNV Sustainability and
Innovation.
At the recent 2011 International
Green Awards in
London, DNV was awarded
bronze in the category
Best Green International
Business Award for large
companies.
+ SUSTAINABLE ENERGY
FOR ALL
At the UN Private Sector Forum in New York recently,
UN Secretary-General Ban Ki-moon kicked off his new
global initiative Sustainable Energy for All, aiming to
engage governments, the private sector and civil society
partners worldwide with the goal of achieving sustainable
energy for all.
Through this initiative, Mr Ban Ki-moon aims to achieve
three major goals by 2030: universal access to modern
energy services, a 40% reduction in global energy
intensity, and an increase in renewable energy use
worldwide to 30%. DNV is committed to supporting
the initiative.
“We are committed to contributing through our dedicated
staff, international network and risk management
expertise to achieve the goals of this UN-driven initiative,”
says DNV COO Sustainability & Innovation Bjørn
K. Haugland.
no 01 2012 – 5

+ News
Kawasaki Heavy Industries obtained DNV Approval in Principle for both the gas supply
system of the vessel and the LNG fuel tanks. Next, KHI plans to perform a safety
assessment of the vessel with DNV.
LARGE LNG-FUELLED CONTAINER SHIP
GRANTED APPROVAL IN PRINCIPLE
Kawasaki Heavy Industries has completed the development of a large 9,000
TEU container ship fuelled by LNG and obtained Approval in Principle from
DNV. The ship is designed with a new type of LNG tank that provides more
space for container cargo.
The LNG is stored in prismatic low pressure insulated tanks and this is the first time
that such tanks have been proposed for a large container ship. KHI has also adopted a
unique technology, the Kawasaki Panel System, for heat insulation in order to reduce
the rate of evaporation of LNG.
“By joining forces, 2,300 experts will meet the needs of
an industry in rapid transition and growth,” says DNV
CEO Henrik O. Madsen.
+ DNV AND KEMA CREATE A
LEADING ENERGY COMPANY
DNV HAS ACQUIRED 74.3% OF KEMA’S SHARES, CREAT-
ING A WORLD-LEADING CONSULTING AND CERTIFICATION
COMPANY WITHIN THE CLEANER ENERGY, SUSTAINABIL-
ITY, POWER GENERATION, TRANSMISSION AND DISTRIBU-
TION SECTORS.
DNV and KEMA will form a world-leading energy
consulting, testing and certification company that can
drive the worldwide transition towards a safe, reliable,
efficient and clean energy ecosystem. DNV KEMA will
consist of all 1,800 KEMA employees and 500 employees
from DNV’s renewable energy and sustainability
activities. The new company will be led by Thijs Aarten,
the CEO of KEMA, and headquartered in Arnhem, the
Netherlands. Mr Aarten will report to a Supervisory
Board chaired by DNV CEO Henrik O. Madsen.
“It is important to understand the environmental imperatives that shipowners face,
but it is also important to recognise that, in reality, the uptake of new technologies
is a balance between risk and business need. Together, DNV and KHI have struck just
the right balance with this vessel,” says DNV President Tor E. Svensen.
WELL INTEGRITY GUIDELINE
The CO2WELLS guideline is the result
of a major joint industry project which
brought together upstream operators
and power utility companies. Aimed at
project developers and authorities, it
describes a generic framework process
for managing the risks associated with
existing wells at carbon dioxide (CO2)
storage locations, both onshore and
offshore.
DNV has previously published industry
guidelines covering the full CCS value
chain of capture, transport and storage.
The new well integrity guideline provides a solution to CO2 storage challenges.
6 – no 01 2012

+ News
+ DNV CONTRIBUTES TO CHINA’S PROJECT
EXCELLENCE
DNV RECENTLY CO-ARRANGED THE CHINA NATIONAL PROJECT EXCELLENCE AWARDS
TOGETHER WITH THE INVESTMENT ASSOCIATION OF CHINA.
The awards were presented at the Investment Risk Management and Control Forum,
a conference organised by the Association. The co-arrangement is part of DNV’s ongoing
commitment to contribute to the development of risk management competence
and sustainability solutions in China.
The Three Gorges project received particular recognition, winning the 2011 National
Project Excellence Special Award with a score of 93.63 out of 100.
“Managing the risks involved in all these massive national projects in China is a major
challenge. However, huge costs can be saved if only 1% of the risks are well managed,”
said DNV’s Sharon Guo, managing director DNV sustainability centre in Beijing.
+ DNV TO CLASS THE
WORLD’S MOST ADVANCED
SEISMIC VESSEL
PGS’ new fifth-generation Ramform series of seismic
vessels is to be built by Mitsubishi Heavy Industries Ltd
in Japan. The order for two seismic vessels, plus two
options is signed.
When completed in 2013, these vessels will be the most
technically advanced seismic vessels featuring 3D seismic
data acquisition and analysis capability. The vessels will
be built to DNV class.
The new seismic vessels are the first in the fifth-generation
Ramform series – the Ramform W-class. With a
length of 104 metres and a breadth of 70 metres, the
series will use diesel electric for the main propulsion
system to ensure quiet operation.
© Getty Images
The Ramform W-class, a PGS offshore
3D seismic vessel.
MAKING THE RIGHT DECISION ABOUT
AGEING FACILITIES
DNV has developed a rapid, semi-quantitative method for evaluating the asset
condition of ageing onshore and offshore oil and gas facilities, including a prioritisation
of the risks and the work required.
Put to the test in both Africa and Europe, the aim is to support the investment or
divestment decisions that often occur when such facilities near the end of their design
life. As the North Sea oil & gas province matures, more assets are changing ownership
to “tail-end” producers that are more able to take advantage of advanced technology
and obtain investments in subsea tie-backs to extend feasible production. This creates
a challenge as the facilities will need attention to continue to operate safely and economically.
A rapid evaluation of their physical condition and ability to continue safe
and effective production is often required to support a due diligence, assist in price
negotiations and meet regulatory requirements.
© PGS
no 01 2012 – 7

+ News
“It’s essential for DNV that the new concept meets the strict requirements of the
existing safety and integrity regime, and I’m pleased to confirm that this concept
does,” says Asle Venås, DNV’s global pipeline director.
+ NEW DEEP-WATER PIPELINE CONCEPT
REDUCES COST BUT NOT SAFETY
DNV HAS DEVELOPED A NEW PIPELINE CONCEPT, CALLED X-STREAM, THAT CAN SIGNIFI-
CANTLY REDUCE THE COST OF A DEEP- AND ULTRA-DEEPWATER GAS PIPELINE WHILE
STILL COMPLYING WITH THE STRICTEST SAFETY AND INTEGRITY REGIME.
The Norwegian Ambassador to China Sven Sæther
(right) and DNV Vice President Joerg Beiler opening
the tap in a recent ceremony to celebrate the clean
water that has arrived at Sanfeng Village.
WATER AND SANITATION
PROJECT IN CHINA
Another water and sanitation project supported by
DNV has been completed and handed over to the
local villagers in Jilin, China.
Since 2005, DNV has continuously supported projects in
north-eastern China by collaborating with the Norwegian
and Chinese Red Cross. In total, more than 3,000 villagers
in 1,000 households have benefited from the projects.
The project in Sanfeng Village consisted of bringing clean
water from a nearby mountain through a gravity tank
and modern piping system to each household and constructing
an ecological sanitation facility for each family
in the village. Health training and education were also
an important part of the project.
“Our quality of life has improved greatly. The most
important thing is that we feel much happier and have
more confidence in the future,” one of the villagers told
visitors after the ceremony.
X-Stream is based on established and field-proven technologies which have been innovatively
arranged. It can reduce both the pipeline wall thickness and time spent on
welding and installation compared to deep-water gas pipelines currently in operation.
The exact reduction in the wall thickness depends on the water depth, pipe diameter
and actual pipeline profile. Typically, for a gas pipeline in water depths of 2,500 m,
the wall thickness reduction can be 25 to 30% compared to traditional designs.
INCREASING ENERGY EFFICIENCY IN
OFFSHORE SHIPPING
“The project will identify
and implement best practice
solutions with regards
to energy efficiency,
acknowledging that the
synergies between energy
efficiency and environmental
impact will be a
competitive advantage for
the partners,” says DNV’s
Sverre Alvik, head of section
environment and
energy efficiency.
A project has been established to identify energy efficiency and fuel saving
initiatives for the offshore shipping industry. The partnership involves a collaboration
of seven Norwegian offshore shipping companies.
The Joint Industry Project is called Energy Efficient Offshore Partners, and consists
of BOA Offshore, Eidesvik Offshore, Farstad Shipping, Gulf Offshore Norge, Havila
Shipping, Siem Offshore and Solstad Offshore, and DNV who is project manager.
8 – no 01 2012

+ News
+ DNV JOINS GREEN GROWTH LEADERS
DNV HAS JOINED GREEN GROWTH LEADERS TO ACCELERATE GREEN GROWTH
DEVELOPMENT WORLDWIDE.
The purpose of the Green Growth Leaders initiative is to accelerate green growth.
This group is among the first in the world to explore the link between “green” and
“growth” and create an open-source platform for the exchange of knowledge, case
studies and communication.
“We firmly believe there is a case for green growth through demonstration and
communication, and that sustainable practices will make businesses stronger and
the world better,” says DNV COO Sustainability & Innovation Bjørn K. Haugland.
DNV’s concept vessel Triality.
TRIALITY WON THE LLOYD’S
LIST INNOVATION AWARD
The Greater China Pipeline Technical Consultative Committee is DNV’s second
pipeline committee in the world and the first of its kind to be established outside
Europe.
PIPELINE COMMITTEE IN CHINA
DNV has established a Greater China Pipeline Technical Consultative Committee. Yang
Zupei, the Secretary General of the CNPC Oil & Gas Storage and Transportation
Standardisation Committee, has accepted DNV’s invitation to be the chairman of the
new committee.
The Lloyd’s List Global Award for the shipping industry’s
best innovation project in 2011 was won by DNV.
Ioannis Kourmatzis, COO Division Europe and North
Africa, accepted the award at a ceremony in London’s
Hilton Hotel.
DNV chose to nominate Triality as its candidate from
among several innovation projects. Triality is a crude
oil tanker concept fuelled by liquefied natural gas, has
a hull shape that removes the need for ballast water,
and will considerably reduce emissions to air.
no 01 2012 – 9

+ News
“In coal bed methane-based LNG developments, we see gaps between the knowledge
of project development practices of onshore contractors newly involved in coal bed
methane and the requirements of owners of mega LNG developments. DNV sees
an opportunity to reduce project construction risks by establishing and aligning
best practices through third-party monitoring of project performance,” says Hans
Kristian Danielsen, Head of DNV Cleaner Energy in Australia.
DNV REPORT CONFIRMS HUGE POTENTIAL
FOR COAL BED METHANE IN ASIA
Coal bed methane may become as important for Asia and Australia as shale gas has
become for North America. For this to come true, the coal bed methane industry must
overcome critical commercial, technical and regulatory challenges.
Coal bed methane is a methane gas which, with the help of hydrostatic pressure, is
locked within unmined coal seams. A DNV-facilitated study has concluded that reliable
verification schemes, more comprehensive performance monitoring systems, more
specific environmental guidelines and more reliable risk mitigation options are needed
to make this industry expand. Almost 40% of the global coal bed methane reserves
are located in China, Australia, India and Indonesia.
+ DNV ACCELERATES ITS CARBON CAPTURE
AND STORAGE ACTIVITIES IN ASIA PACIFIC
CARBON CAPTURE AND STORAGE, ENABLING THE USE OF CO2 FOR ENHANCED OIL AND
GAS RECOVERY, IS CURRENTLY BEING PLANNED FOR PROJECTS IN ASIA, AUSTRALIA AND
THE MIDDLE EAST.
DNV, together with the industry, has recently developed recommended guidelines
and best practices for CO2 geological storage selection and risk assessment. DNV
is in close dialogue with energy ministries and leading energy companies throughout
Asia. Areas addressed include feasibility studies for CO2 capture from onshore
power plants, offshore and onshore gas production from gas streams containing high
amounts of CO2, and subsequent storage in depleted gas fields. The use of CCS to
enhance oil recovery is also high on the agenda.
“One of the most difficult hurdles facing CCS is locating
geological sites which are safe for long-term CO2
storage and have the required CO2 storage capacity
and injectivity” says Chief Technology Officer Dr Jens
Petter Tronskar of DNV’s Clean Technology Centre in
Singapore.
“A number of companies have been awaiting the internationally
recognised ISO 50001 standard, and this
accreditation is very important for providing energy
management system certification to clients worldwide,”
says Tor Gunnar Tollefsen, Global Product Manager
for Management System Services in DNV Business
Assurance.
+ ACCREDITED FOR NEW
ENERGY MANAGEMENT
STANDARD
The new standard ISO 50001 is the first internationally
recognised energy management system standard, and
DNV was among the first certification bodies to receive
accreditation.
DNV Business Assurance was granted the full accreditation
scope under the Dutch RvA scheme, and offers
certification to organisations worldwide. DNV Business
Assurance has already been active in energy management
for several years, offering certification according
to EN 16001, the European energy management system
standard, but also according to national standards.
10 – no 01 2012

+ Carbon capture and storage
PRESIDENT ZUMA DISCUSSED
CARBON CAPTURE AT DNV
THE SOUTH AFRICAN PRESIDENT, JACOB ZUMA, NORWAY´S KING HARALD V, THE NORWEGIAN MINISTER OF OIL
AND GAS, OLA BORTEN MOE, AND NUMBER OF INDUSTRY PLAYERS MET AT DNV RECENTLY TO DISCUSS COOPERATION
AND THE FUTURE FOR CARBON CAPTURE AND STORAGE (CCS). DNV ENCOURAGES A CLOSE COOPERATION BETWEEN
STAKEHOLDERS IN ORDER TO REALISE CCS AS AN INDUSTRIAL OPPORTUNITY.
TEXT: SVEIN INGE LEIRGULEN PHOTOS: NINA E. RANGØY
President Zuma visited DNV as part of
his State visit to Norway, and CCS was
on the agenda.
“Developing CCS into a mature solution
is a long-term assignment which many
countries and companies now have taken
a great responsibility to handle. I am therefore
glad to see that a number of industrialscale
CCS projects are already in operation
or in development, and several of these
are located in Norway and in continental
Europe,” said DNV CEO Henrik O.
Madsen in his speech to the representatives
from South Africa and Norway.
He continued in his speech, “However,
though considerable technical developments
have been achieved, challenges
remain for a global deployment of CCS.
The challenge is complex, but it looks
promising. It is all about obtaining sustainable
interaction between technology
developers, regulatory bodies, and financial
institutions. And it is not least about building
trust amongst the public.”
This is why DNV has taken the role in
developing international guidelines and
standards for the whole CO2 value chain;
from capture and transport to safe storage
of CO2. These have been developed
through a collaborative approach with
industry and regulators. After the launch
early last year, the guidelines have been
widely used in the industry, and the new
European CCS directive is referring to
DNV’s guidelines for CO2 transport and
I President of South Africa Joseph Zuma entering DNV’s head office together with DNV CEO Henrik O. Madsen.
storage. Our aim is for many other countries
to use this compiled knowledge as
basis for their own regulations. DNV has
been chosen by the European Commission
to facilitate the European Union’s knowledge
sharing network, where experiences
from the European CCS demonstration
projects are captured.
Closing up the meeting, President Zuma
commented: “Climate change will affect
all of us. The development of the CCS
technology is an attempt to meet this challenge.
It is clear to us that this is a part of
the total solution. This technology is really
welcome, and it is important that we work
together moving forward.”
no 01 2012 – 11

+ Arctic operation
12 – no 01 2012

LOW RISKS
IN THE
HIGH NORTH?
MAJOR OIL AND GAS ACCIDENTS IN THE PAST FEW DECADES HAVE FORCED
SIGNIFICANT IMPROVEMENTS IN TECHNOLOGY, PROCEDURES AND REGULATIONS.
“NOW, WHEN SEEKING OPPORTUNITIES IN THE ARCTIC AREAS WE MUST ENSURE
THE SAME LEVEL OF RISK AS IN THE NORTH SEA,” EMPHASISES KNUT ØRBECK-
NILSSEN, DNV COO DIVISION NORWAY, RUSSIA AND FINLAND.
TEXT: SVEIN INGE LEIRGULEN PHOTOS: DAMIR CVETOJEVIC
Oil and gas producing countries have experienced several catastrophic accidents
in the past 30 years. Alexander L. Kielland in Norway, Piper Alpha in the UK,
Montara in Australia and Deepwater Horizon in the US have all claimed many
lives or caused significant oil spills.
Mr Ørbeck-Nilssen explains that another common characteristic with all these tragedies
is that they were completely unexpected. However, they have forced the development of
improved procedures, standards and technologies. On the regulatory side, responsibilities
have become clearer and new governmental safety agencies have been established.
“Offshore safety has never been so high on the public agenda as in the past year. The
industry is debating how to improve technologies and safety solutions, and authorities in
both the US and the EU are developing stricter requirements for oil and gas operations.
There is no doubt that the rules of the game will change with more focus on offshore
safety, environmental protection and risk assessments,” he predicts.
RISK MANAGEMENT ENHANCES SAFETY
“The use of a risk management approach is vital to increase safety. We should not confuse
the risk of a certain event taking place with only the consequences it may result in.
That is not taking into account the likelihood for the event to occur. This approach, the
so-called ‘worst case scenario’ will lead to many decisions without a sound factual basis.
“This is not what risk is about. Risk management is about increasing safety by analyzing
what and where something can go wrong, minimising the probability for it to occur and
ensuring that you can reduce its consequences,” he clarifies.
An oil and gas operator who embraces this approach within its management system will
be able to enhance and manage safety levels, continuously. Authorities that base their
regulations on a risk based approach will also have a pragmatic tool that enables them
to decide on an acceptable level of risk for their countries to harvest resources. This also
provides the basis for regulations that allow for technology development and new and
better solutions. Risk analyses will further provide a common interface for discussions
between stakeholders, for example regarding a decision of whether or not to allow an
industrial activity.
no 01 2012 – 13

+ Arctic operation
I In the high north the conditions are tough. Extremely low temperatures and long periods of darkness create a demanding working environment for personnel, but it also affects
the material properties and operation of equipment.
I “As the industry moves north into the Arctic, and seen
in the light of risk management, both policy makers and
the industry must agree on an acceptable risk level. As
a minimum we should maintain the same risk level as
in the North Sea,” says Knut Ørbeck-Nilssen, DNV COO
Division Norway, Russia and Finland.
“This is indeed how many companies
and countries, such as Norway and the UK,
have managed their oil and gas operations
for many years. Here, both regulations and
operations are based on risk management,
and the responsibility falls on the operator
to obtain a certain safety level,” says Mr
Ørbeck-Nilssen.
MANAGING ICY RISKS
20% of the world’s undiscovered resources
may be found in the Arctic regions. He
points out that exploration has already
started in the harsh environments found
in Greenland, Shtokman and the Barents
Sea, with more to come.
“In these locations, achieving safe
operations is more demanding than in for
example the North Sea, where oil and gas
has been produced since the 1970s in some
of the world’s most challenging conditions.
In the high north the conditions are
much, much tougher. Extremely low temperatures
and long periods of darkness create
a demanding working environment for
personnel, but it also affects the material
properties and operation of equipment,”
he explains.
Snow, slush, fog and icing can reduce
the functionality and availability of safety
barriers. And closely linked to this is the
question of how emergency preparedness
and oil spill recovery can be provided in
case of an accident.
“How do you remove oil from ice, and
how do you evacuate 100 people in a
–50 o C snowstorm 200 km from the shore
with limited infrastructure in remote
locations?” he asks.
“These are just a few examples of the
safety challenges we must face in the years
to come, but I know that much research
and development is already in process,”
Mr Ørbeck-Nilssen points out.
14 – no 01 2012

Major accidents
since 1980
ALEXANDER L. KIELLAND
The collapse of the Alexander L. Kielland
rig in 1980 is still fresh in the minds of
the international oil and gas industry and
particularly in the Norwegian community.
A bracing on one of the legs broke, probably
due to fatigue, and the unit had
no redundancy against this eventuality.
Shortly after, the leg was lost, causing a
rapid list of 30–35 degrees. After twenty
minutes the rig turned upside down completely.
Nobody had foreseen this accident
which caused 121 lives.
INTERNATIONAL COOPERATION
He emphasises another important issue,
which is international cooperation.
“All five Arctic coastal states must work
together to implement the same understanding,
standards and regulations with
regards to offshore safety. A great example
of cooperation is the Barents 2020 project
between Russia and Norway. Since 2006,
experts from both countries have worked
closely together in order to learn, develop
and harmonise rules for safety in the
Barents region. This was initially a bilateral
initiative, but it is now developing into a
significant pan-Arctic project,” he states.
Mr Ørbeck-Nilssen believes that as the
industry moves north into the Arctic, and
seen in the light of risk management, both
policy makers and the industry must agree
on an acceptable risk level. As a minimum
we should maintain the same risk level as
in the North Sea.
He explains that, since the consequences
in these sensitive areas will be much higher
in case of an accident, the emphasis must
be on developing solutions which reduce
the probability of undesired events.
“Further, to minimise the consequences
of an accident, the industry and the regulators
must work together to find appropriate
mitigation measures in order to meet the
agreed risk level,” he underlines.
“We recommend that the five Arctic states
agree on common regulations, and the
industry must develop technologies and
standards adapted to the harsh Arctic conditions.
I see this more as an opportunity
than a threat, as long as we manage the new
risks in a systematic, unified and transparent
manner,” concludes Knut Ørbeck-
Nilssen.
PIPER ALPHA
Eight years later, on the UK continental
shelf, 167 lives were lost in the Piper
Alpha disaster, making this the worst
offshore accident ever experienced. An
explosion was caused by gas released and
ignited by hot gas turbine casings or frictional
sparks.
MONTARA
In 2009, an oil and gas leak and subsequent
slick took place in the Montara oil
field in the Timor Sea, off the northern
coast of Western Australia. Lasting for
74 days, it was one of Australia’s worst
oil accidents.
DEEPWATER HORIZON
The Deepwater Horizon accident happened
on April 20, 2010 when the
control of the Macondo well was lost
resulting in explosions and fires on the
drilling rig. It was the largest oil spill in
US history, and in comparison to the
Exxon Valdez’ 500,000 barrels spill, the
Macondo well released five million barrels
into the Gulf of Mexico.
no 01 2012 – 15

+ Interview
AN INDUSTRY
FOR THE FUTURE
2011 WAS A GOLDEN YEAR FOR NORWAY’S OIL AND GAS INDUSTRY. IN ADDITION TO THE HISTORIC AGREEMENT WITH
RUSSIA ON THE MARITIME DELIMITATION IN THE BARENTS SEA, THREE NEW GIGANTIC OIL DISCOVERIES SUPPORT
THE MINISTER OF PETROLEUM AND ENERGY’S STATEMENT THAT “THIS IS AN INDUSTRY FOR THE FUTURE”.
TEXT: SVEIN INGE LEIRGULEN
Ola Borten Moe became Norway’s
new Minister of Petroleum and
Energy only a few months before
the long awaited treaty between Norway
and Russia on the maritime delimitation
in the Barents Sea and the Polar Ocean
entered into force on 7 July 2011.
What does this agreement mean to both of the
countries?
With this treaty, we are setting an example
on how delimitation issues can be resolved
peacefully, in accordance with international
law and within the framework of modern
international jurisprudence. Norway
and Russia are also making it clear that
there is no ongoing race for resources in
the Arctic, but that they both – as responsible
Arctic coastal states – are adhering to
international law.
New opportunities for petroleum activities
and cooperation are now emerging in
areas of the Barents Sea that were previously
closed to such activities. The treaty
also covers cooperation in these areas –
not least with regard to the exploitation
of any transboundary petroleum deposits
that are discovered. Such deposits are to
be exploited as one unit.
Norway has already started the geological
mapping on its side of the delimitation
line. This will be one element in an impact
assessment that we will carry out for this
part of our continental shelf.
What is Norway’s future strategy in the north?
As mentioned, the geological mapping of
the new areas in the South-East Barents Sea
started last summer and will continue in
the summer of 2012 as part of an impact
assessment process, as described in our
Petroleum Act. Such an impact assessment
is required as a basis for opening this area
for petroleum activities.
In addition, we plan to award new production
licences in the Barents Sea South in
our ordinary licensing rounds.
Could you comment on the safety challenges
and environmental risk posed by O&G activities
in such sensitive, harsh and remote areas of the
world?
Norway has carried out petroleum activities
in the Arctic for more than thirty
years. Our experience is that the conditions
in this area require the same kind
of regulation of safety and the environment
as other parts of the Norwegian
Continental Shelf. The basic frameworks
and conditions for the petroleum activities
have now been determined by the
Government through the integrated
management plan for the Barents Sea
and Lofoten, which was adopted by the
Norwegian parliament in June this year.
What is the importance of cooperation on health,
safety and the environment, such as the Barents
2020 project between the Norwegian and
Russian O&G industries?
I believe that this project is very valuable as
a means of sharing experience and knowledge
between Norway and Russia. This project
will therefore continue into a new stage.
How will Norway work to ensure the same low
level of risk in the northern areas as in the North
Sea?
The petroleum legislation applies in the
same manner to all parts of the Norwegian
Continental Shelf. A thorough risk analysis
must be carried out by the licensees as the
basis for any petroleum activity – including
in the north. In addition, concrete requirements
are set with regard to discharges
and emissions to sea and air – in the
16 – no 01 2012

© OED
I Ola Borten Moe is Norway’s Minister of Petroleum and Energy, one of the world’s biggest oil and gas producing countries.
no 01 2012 – 17

+ Interview
© Scanpix
I In addition to three new gigantic discoveries in 2011, new opportunities for petroleum activities are now emerging in the Barents Sea. To Ola Borten Moe there is no doubt the
oil and gas industry has a promising future.
Norway’s oil industry
In the late 1950s, very few people believed that the Norwegian Continental Shelf (NCS) might contain rich oil and gas deposits. With the
Ekofisk discovery in 1969, the Norwegian oil and gas adventure really began. Oil production from the field started on 15 June 1971, and
in the following years a number of major oil and gas discoveries were made.
Norway is ranked the fifth-largest oil exporter and the tenth-largest oil producer in the world. Correspondingly, the country is the secondlargest
gas exporter and the fifth-largest gas producer in the world.
In spite of more than 40 years of production, only around 40% of the total expected petroleum resources on the NCS have been produced.
Norwegian oil and gas production has remained at a plateau level of about 3 million barrels per day since 1995. Production reached a peak
of 3.4 million barrels per day in 2001. In 2009, the oil production had decreased to 2.4 million barrels per day and it is expected to shrink
further in the years to come. However, because of increasing gas production and new discoveries, the total petroleum production is likely
to grow in the coming years. From representing approximately 43% of the total Norwegian petroleum production in 2009, gas production
will probably increase to more than 50% in 2013.
Source: Ministry of Petroleum and Energy
18 – no 01 2012

I “We must ensure the same low risk level in the
northern areas as in the North Sea through risk analysis,
international knowledge sharing and concrete requirements
for emission and discharges,” says Norway’s
Minister of Petroleum and Energy, Ola Borten Moe.
OFFSHORE WIND
same manner as for all other parts of the
Continental Shelf. We also work together
with other Arctic countries on knowledge
sharing. I was recently on a trip to the
USA and Canada where this was one of the
issues we discussed.
What impact has the Deepwater Horizon accident
had on the progress of exploration and production
in Norway and in particular the northern
areas of the country?
This accident has raised our awareness of
our petroleum regime and its robustness
with regard to safety levels, emergency
preparedness and liabilities. New technologies
are under development to improve
blow-out prevention, and such technologies
will also be applied in Norway. We
have, however, found no immediate need
to change our legal regime for our petroleum
activities.
NEW GIGANTIC DISCOVERIES
Three new high impact discoveries in
only the past few months have given the
Norwegian oil and gas industry a bright
future. Norway has not seen a similar oil
discovery since the mid-eighties. According
to Statoil, Aldous/Avaldsnes is a giant oil
discovery, and they estimate the combined
discovery may be one of the biggest on the
Norwegian Continental Shelf’s. In combination,
these may represent an oil structure
of between 1,7 and 3,3 billion barrels
of recoverable oil equivalent.
Statoil, along with partners Eni Norway
and Petoro, has also made a significant
oil discovery on the Skrugard prospect in
the Barents Sea. The estimated volume of
the discovery is between 150–250 million
recoverable barrels of oil equivalent, while
Statoil sees opportunities for a further
upside in the license of up to 250 million
barrels – to reach a potential total of 500
million barrels.
What impact do these discoveries have on
Norway and its O&G industry?
© Statoil
Apart from increasing the general attractiveness
of the Norwegian Continental
Shelf as a petroleum region, these discoveries
will – like all other profitable discoveries
– be matured for development in due
course.
Norway has a very long coast line which
may create opportunities for offshore
wind energy. What is Norway’s strategy
for offshore wind energy?
Norway has put in place a legal framework
for utilising offshore wind energy.
This legal framework was complemented
by a national strategy on the development
of an offshore wind sector.
However, in order for offshore wind
to be attractive, costs must be brought
down. This is a challenge that has to be
addressed by the industry. The public
sector is also contributing. Since 2007,
government funding for research, development
and demonstration work has
roughly quadrupled. This includes three
centres for environment-friendly energy
research that target different aspects of
developing offshore wind energy.
In order for offshore wind power to
become a sustainable option for domestic
energy supply, it will take research efforts
to tackle both costs and technological
challenges. However, despite the fact that
there is no domestic market at present,
we see that companies which combine
expertise from the hydropower sector and
offshore sector are pursuing business
opportunities in more mature offshore
wind markets such as the UK and
Germany, and even China and the US.
The Ministry supports these internationalisation
efforts through INTPOW.
no 01 2012 – 19

+ LNG
TWO TOPICS,
ONE VOICE
DNV HAS BEEN INVOLVED IN THE LNG INDUSTRY SINCE THE 1960S, AND THE COMPANY IS WORKING
ON PROJECTS RIGHT ACROSS THE SPECTRUM OF LNG ACTIVITIES. TODAY, LNG IS ONE OF THE FASTEST GROWING
ENERGY MARKETS AROUND THE WORLD. GIVEN THE NUMBER AND SCALE OF NEW LNG PROJECTS PROPOSED OR
UNDER CONSTRUCTION, GLOBAL PRODUCTION CAPACITY COULD MORE THAN DOUBLE BY THE END OF THE DECADE.
DNV IS WORKING HARD TO SHARE ITS COMPETENCIES WITH CUSTOMERS AND THE INDUSTRY, ENSURING
LNG REMAINS A VIABLE, COST-EFFECTIVE AND SAFE ENERGY SOURCE.
TEXT: RICHIE MACTAGGART PHOTOS: NINA E. RANGØY
Another expanding area of business
for DNV concerns the growth of
the Arctic region. The United
States Geological Survey believes that the
Arctic seabed contains nearly 20% of the
world’s oil reserves and 30% of its gas
reserves. Add to that the fact that ships will
soon be able to sail across an open Arctic
Ocean during the summer months, and it
is no wonder DNV expertise in Arctic matters
is so sought after.
With these two issues very much in the
spotlight, DNV Forum decided to take the
opportunity to speak to a key player on
these topics. Rikke Lind, a Norwegian politician,
was appointed in 2005 to the position
of State Secretary of the Norwegian
Ministry of Trade and Industry. Due to
Norway’s prominence in the shipping industry,
ownership of oil and gas resources and
location close to Arctic waters, Ms Lind is
often involved in these issues both domestically
and internationally.
THE FUTURE OF LNG
Norway has taken the lead developing the “LNG
as fuel” concept for shipping. What development
do you see here in a global perspective?
Compared to other fuel sources, LNG is
good for the environment and – with the
developments being made here – good for
Norwegian business. For example, DNV
has come with many new concepts for LNGfuelled
ships, such as Triality, a concept for
new, energy-efficient tankers. DNV has
taken a lead in this area, and research
programs such as these are on-going
throughout the country.
Norway already has a leading position in the use
of LNG as a fuel, such as on ferries and supply
ships. What explains Norway’s pioneering role in
this area?
We have a long heritage as a maritime
nation, and over recent decades we have
built our competence in the energy sector.
Combining the capabilities of these two
disciplines, it is no wonder we are now taking
a global lead.
The three main efforts that explain
Norway’s pioneering role in environmental
shipping are: The NOx Fund; LNG a fuel
on ferries; and the use of LNG as fuel on
some offshore vessels.
The Norwegian government also has
an important role to play. We did work
to help with studying the distribution of
LNG, and we share our experience with
other countries in the Nordic region. We
have also met with the EU commission
and with the Russian government to pass
on our experiences and advise on how to
extend the use of LNG.
What is being done to raise the knowledge necessary
to develop infrastructure for distribution
and refuelling terminals on a global basis?
Norway has, alongside other countries and
maritime operators in Northern Europe,
financed a feasibility study that is looking
at the distribution of LNG as a marine fuel
in ports around the North Sea and Baltic
Sea. Once this study is complete it will
undoubtedly improve the knowledge, and
therefore the decision-making process, for
the authorities, ports and shipping companies
that are considering LNG as a ship
fuel.
Much of this understanding is being
gained through the pioneering work in a
number of ports, and the report highlights
these as examples that others can benefit
from. A project being undertaken at the
LNG terminal in Gothenburg is an exam-
20 – no 01 2012

I “Compared to other fuel sources, LNG is good for the environment and – with the developments being made here – good for Norwegian business,” says Rikke Lind, State
Secretary of the Norwegian Ministry of Trade and Industry.
no 01 2012 – 21

+ LNG
I “There is a great opportunity to make the Baltic a Model Region for environmentally related infrastructure at ports and to initiate a new generation of ships powered by gaseous
and environmentally friendly fuels like LNG,” says Rikke Lind, here photographed in Oslo harbour. The vessel on the far left is the LNG-fuelled Nesodden ferry.
ple of this; DNV is a partner there, bringing
forward its expertise.
Norway has recently had the role of leader of the
Council of Baltic Sea States in the previous period.
It has been decided that the Baltic Sea will
be an ECA (Emissions Control Area). What consequences
will this decision have on Norwegian
shipping?
First and foremost, the Norwegian chairmanship
was very useful in allowing us to
create awareness of LNG as a fuel for the
maritime industry in the region.
We are leading the way in developing
environmentally friendly initiatives for the
shipping industry. This means we are well
positioned when it comes to the plans we
want to see come to fruition in the Baltic
Sea. There is a great opportunity to make
the Baltic a model region for environmentally
related infrastructure at ports, and to
initiate a new generation of ships powered
by gaseous and environmentally friendly
fuels like LNG. Short-sea shipping and sustainable
shipping in the Baltic Sea region
also need to happen and we will be pushing
to make them so.
We have seen interest from several countries,
and we look to the development of
LNG terminals around the Baltic Sea that
could potentially lead to small-scale use.
Particularly positive is that Viking Line will
operate with a dual-fuel ferry on its route
between Stockholm and Helsinki. This
may be the first of several LNG-powered
vessels that will operate in the Baltic Sea.
The Baltic Sea is an area with special
environmental challenges, which the new
IMO requirements will help improve.
I believe that the maritime players in the
area are very aware of the environmental
benefits of LNG as a fuel, and I hope that
the Norwegian authorities have played a
role in this.
THE FUTURE OF THE ARCTIC REGION
How do you see development, both short- and
22 – no 01 2012

“DNV has taken a lead within LNG,
and research programs are on-going
throughout the country due to the
knowledge we have in Norway.”
long-term with regard to further the establishment
of the oil and gas activities in the Arctic zone?
Extraction of petroleum in the Arctic
zone can provide new opportunities for
Norwegian petroleum companies and
Norwegian suppliers. Exploration and
extraction will have to take place within
the parameters set by the Ministry of
Petroleum and Energy, and shall ensure
consideration of environmental conditions,
fisheries and other business interests. The
activities must also be carried out within
the framework provided in the Management
Plan for the Barents Sea and the sea areas
off the Lofoten Islands.
The maritime delimitation line between Norway
and Russia is now in place. How do you foresee
that cooperation with Russia will be in the
future?
The recent treaty on maritime delimitation
and cooperation in the Barents Sea and
the Arctic Ocean provides new opportunities
for Norwegian-Russian economic
cooperation, both offshore and onshore.
We have great expectations that the treaty
will open up for greater growth in the
North, and increased cooperation and
exchange of expertise across the border.
What opportunities do you see for Norway
from an industrial perspective?
Norway has the world’s most advanced
and second largest offshore fleet, after
the US. Norwegian offshore shipping and
other maritime companies have significant
experience in oil activity at sea in harsh
weather conditions. A specific initiative by
the government has aimed to strengthen
maritime expertise and research. This will
help ensure that the Norwegian maritime
industry is poised to exploit opportunities
and meet challenges related to Arctic oil,
gas and marine resources, and open new
transport routes for energy and shipping
in the North.
Increased petroleum activity in the Arctic
could also provide development and operating
projects for Norwegian suppliers who
already possess great expertise in petroleum
operations in cold climates.
The political climate is now in place to ensure
cooperation with Russia on security and sustainability
in the future. What are the Norwegian
government’s next steps?
The relationship between Norway and
Russia is currently very good, and there
are frequent meetings and visits at both
the political and business level. The
Norwegian authorities are using every
opportunity to address the challenges
related to the framework conditions for
investments in talks with Russian authorities.
Challenges and problem cases are
also discussed in meetings between
Norwegian and Russian authorities.
The private sector has for years requested
strategic priority of Russia in terms of
improved conditions for investments in
the Russian market. Our government is
now working on a national strategy for economic
cooperation with Russia, to identify
the potential for increased cooperation
and the challenges Norwegian industry is
facing in Russia.
How can human and environmental safety be
ensured?
Norway underlines the need for an
improved Polar Code with regard to safety
and the environment. It is important for us
to ensure that the design and use of equipment
is suitable for operation in Arctic
waters, and that environmental concerns
are addressed in a proper manner.
An Agreement on Search and Rescue
(SAR) through the Arctic Council (Canada,
Denmark, Finland, Iceland, Norway, the
Russian Federation, and Sweden) was
signed in May 2011; this will improve
search and rescue response in the Arctic.
The Council is now working on a similar
common instrument for Arctic oil spills.
The signing of the SAR Agreement is a
positive step toward building partnerships
in the Arctic. In particular, it reflects the
commitment of the Arctic Council states
to enhance their cooperation and offer
responsible assistance to those involved in
a range of activities, as the Arctic region is
opening up for shipping and energy developments.
no 01 2012 – 23

+ Integrity management
STATOIL STEP CHANGE
GETS NOTICED
THE GROUNDBREAKING TECHNICAL INTEGRITY MANAGEMENT PROGRAM (TIMP) IS IN USE ON ALL STATOIL INSTALLATIONS,
BOTH ONSHORE AND OFFSHORE, IN NORWAY AND DENMARK. INGBJØRN REFSDAL, VP MODIFICATIONS WAS LEADER OF THE
TIMP TEAM. THE WHOLE TEAM, SUPERVISED BY MR REFSDAL, WORKED DEDICATED THROUGHOUT THE PROJECT ALWAYS ON
THE LOOKOUT FOR FRESH IDEAS, DIFFERENT APPROACHES AND WAYS TO IMPROVE OPERATIONS.
TEXT AND PHOTOS: KAIA MEANS
In his previous position as VP Operations
at Statoil, Ingbjørn Refsdal addressed the
need for a holistic approach to technical
integrity management since vital information
was created and located in various
systems.
Mr Refsdal’s time is now dedicated to
improving Statoil’s technical integrity
management system – through changes in
work processes, methodology, competence
and tools, based on best practices in the
industry. TIMP brings a uniform approach
to the follow-up and management of technical
integrity across all the company’s disciplines
and assets. As the users gain more
experience by using the system daily, TIMP
will be continuously improved to support
the control and management of the assets’
technical integrity in a lifecycle perspective.
The TIMP team has created a system
that is based on streamlining information
and making it available to decision-makers
through a common work platform, visualised
in a portal. Other industry players
have shown interest in the program, and
Mr Refsdal explains his willingness to share
Statoil’s experience with others.
“As an industry, we should become much
better at talking together and sharing our
experience. We have a tendency to work in
separate silos. We share information after
an incident, but why wait? We have to get
I “As an industry, we should be much better at talking together and sharing our experience” says Ingbjørn Refsdal
VP Modifications at Statoil.
better at sharing how to reduce the likelihood
of major accidents,” he says.
DECISIONS
TIMP is now in use for all Statoil operating
facilities, offshore and onshore, in both
Norway and Denmark (Kalundborg). It
centres on a portal where information is
accessed and evaluated. TIMP gives users
colour-coded graphics that provide a full
overview of and detailed reports on the
condition of the asset at any given time.
Decision makers are better able to prioritise
based on relevant information and
assessments. Aligned work processes provide
a common way to follow up the tech-
24 – no 01 2012

nical integrity, which is a prerequisite for
a more optimal prioritisation of mitigating
measures to ensure adequate safety and
avoid severe production losses.
“But TIMP is not really just a tool, it’s
a concept. You can’t separate the portal
from the change in culture, the difference
in understanding and the knowledge
and competence surrounding it,” says Mr
Refsdal. “TIMP is a step change for managing
the technical integrity of oil and gas
plants, and the TIMP concept and the way
it has been implemented across all Statoil’s
assets has become a reference project in
the oil and gas industry,” says Erik Østby,
DNV’s Customer Service Manager for
Statoil. A common risk-based method for
measuring and visualising the actual technical
condition of components and systems
allows better decisions and the allocation
of resources for repairs and modifications
across the various operations.
One important aspect of TIMP is the
training of staff in understanding risk and
the more efficient use of SAP, in which
DNV has worked alongside the TIMP
teams. In the course of seven months,
approximately 1,600 employees have been
trained in safety barrier management as
a key element of controlling major accidental
risk. A key success factor of the
TIMP project is the interplay between the
methodology developed for measuring the
technical condition, the tailored work processes,
the dedicated training of personnel
and the IT tool supporting the entire process.
If one of the four elements had been
left out, the quality and thus the value of
TIMP would have dropped significantly.
DETAILS AND OVERVIEW
In the TIMP Portal, users can go down
to detailed levels and obtain information
on every tag concerning the condition of
each piece of equipment in a production
facility.
The TIMP Portal brings together information,
facilitates reporting and creates a
common rating system for the technical
condition where there were previously
many different rating systems and scales.
“People have to see why it’s useful for
them to be part of it,” Mr Refsdal says.
“People always ask, ‘What’s in it for me?’
The people who are using the portal can
see that it gives them more structure. They
know what their responsibilities are. They
have the complete overview in one place.
They see the value of it.”
The result of the hard work behind the
program has been good planning, a tight
roll-out and dedicated employees across
the board.
As the program has become known in
the industry, Mr Refsdal has been invited
to give presentations about it at conferences
and seminars.
INTERNATIONAL INTEREST
“There’s been a lot of interest in the project,
especially internationally,” he says.
“And it’s always important to ask what we
can learn from others. The whole concept
centres on learning.” The TIMP project
team visited other companies and even
other industries, such as aviation and
high-speed rail companies, when gathering
their initial input on how to create the
system. Part of Mr Refsdal’s motivation
in giving talks to the industry is to obtain
feedback and improve the program even
more.
CONTINUOUS IMPROVEMENT
The program was implemented in 43 facilities
over the course of just seven months.
Mr Refsdal says this rapid implementation
was important in order to support a true
shift in the way people work, not just incremental
change.
“When you make a system, sometimes it
just stops there. But that’s when the real
job starts. You have to change behaviour.
People have to experience what’s in it for
them, or else they will go back to their old
behaviours. It’s an ongoing process,” he
says.
The future of TIMP might see even more
expansion. There are plans to use it for
subsea operations, for pipeline integrity
and load-bearing structures; and perhaps
also for drilling.
Technical Integrity Management Program – TIMP
Four main elements:
A competence program based on training initiatives
Work processes with clear roles, responsibilities and follow-up methods
Technical integrity assessment of equipment and systems based on defined criteria
The TIMP portal, which visualises technical integrity and assists in work processes
TIMP has completed 100 training sessions with 1,600 Statoil engineers and managers. It has been developed in cooperation with many
different groups of expertise in Statoil as well as with DNV.
no 01 2012 – 25

+ Fosnavåg
26 – no 01 2012

FOSNAVÅG –
A SMALL COMMUNITY
WITH GLOBAL
IMPACT
A MUNICIPALITY WITH 8,500 INHABITANTS ON THE VERY EDGE OF THE
NORWEGIAN COASTLINE HAS MADE A SOLID IMPRESSION ON THE ENTIRE GLOBAL
MARITIME COMMUNITY – AS A HUB FOR MARITIME OFFSHORE ENTREPRENEURSHIP,
AND AS A CENTRE FOR VALUE CREATION AND TECHNOLOGICAL EXCELLENCE.
TEXT: JANNICKE WITSØ PHOTOS: NINA E. RANGØY
Located on the north-west coast of Norway, Herøy is a part of the unique Norwegian
maritime cluster. The municipality has undergone a massive transformation over the
past six decades – from having an industrial base dominated by the fishery sector to
one that has evolved into a breeding ground for the flourishing offshore supply industry.
And as a tribute to this, Herøy’s administrative centre of Fosnavåg was last year chosen as
the “most business-friendly city” in Norway – for the second time in three years.
So what is so special about this small municipality?
And what has been its recipe for success?
no 01 2012 – 27

+ Fosnavåg
DEFINED BY THE SEA
FOR CLOSE TO EIGHT YEARS, ARNULF GOKSØYR HAS BEEN THE MAYOR OF THE MUNICIPALITY OF HERØY –
A COMMUNITY THAT NEVER CEASES TO IMPRESS WELL BEYOND REGIONAL AND NATIONAL BORDERS.
THIS MAKES HIM PROUD – AND HUMBLE. PROUD OF THE DRIVE AND ACHIEVEMENTS OF THE PEOPLE OF HERØY.
AND HUMBLE IN THE FACE OF THE FORCES OF NATURE THAT HAVE BROUGHT NOT ONLY CHALLENGES TO HERØY,
BUT ALSO OPPORTUNITIES – OPPORTUNITIES TO REAP THE REWARDS OFFERED BY THE SEA.
Herøy is a coastal community that
owes much of its success to the sea.
The sea has not only been the basis
of the community’s existence for centuries;
it has also been the very source of Herøy’s
industrial growth and development. In
recent history, the fishing sector has been
the main industrial activity here, but since
1970 Herøy has also become a major offshore
supply metropolis.
According to the mayor, the residents of
Herøy have worshipped opportunities provided
by the sea throughout history.
“We have many stories about the sea
that define us as human beings. Historically
speaking, the fishing sector has been tough
on the community in Herøy. It has hardened
us. Women and children were left
behind when the men went to sea. There
have been many tragic stories. But many
happy stories as well. All these experiences,
however, have taught us to be tough but
humble, willing to take risks but not careless,
and competitors but not at all costs,”
says Mr Goksøyr.
However, some major changes have
had dramatic repercussions for the community.
Starting in the 1950s, the number
of fishing vessels decreased as a result of
technological developments and increased
efficiency in the industry. For the people
along the Norwegian coast, increased efficiency
meant less need for manpower. The
result was a dramatic decline in the number
of fishermen – from 100,000 in 1950
to approximately 12,000 today.
Somewhat in parallel with the technological
revolution that was transforming
the fishing industry, oil was discovered in
the North Sea.
Mr Goksøyr elaborates. “We increasingly
acknowledged that further expansion
wouldn’t happen within the fishing industry.
Soon after oil was discovered in the North
Sea, a few people from Herøy with insight
from the fishing industry saw potential synergies.
In essence they, with Per Sævik in
the lead, were the ones who kicked off the
offshore adventure in Norway. They saw
clear parallels between fishing and offshore
activities; for instance they saw that both the
design and equipment were similar.”
Still – even with these basic premises in place,
how did Herøy succeed beyond anyone’s wildest
imagination?
According to Mr Goksøyr, more than one
thing makes people from Herøy and its
surrounding areas stand out.
It is said that people from Herøy have
historically been more inclined to take risks
than their neighbours along the Norwegian
coast. They have travelled farther out to
sea. They have invested more of their turnover
in new equipment and technology.
And they have taken more risky decisions
concerning investment and growth.
Good cooperation and healthy competition
is another significant aspect.
“I’ll tell you a true story from our community.
One of our offshore shipowners
recently invested in a newbuilding that was
designed to be 120 metres long. When he
found out that his neighbour, a fellow
shipowner, had ordered a vessel that was
122m he called the shipyard and asked for
his vessel to be made three metres longer.
That’s how we do it here,” says Mr Goksøyr.
Mr Goksøyr also thinks it helps that the
people of Herøy have a down-to-earth perspective
on their own wealth.
“You won’t see a millionaire in Fosnavåg
building a gigantic mansion for the money
he has earned. The shipowners and other
industry leaders live in the houses they
have always lived in. They funnel the money
they earn back into their business. And
they give back to society. Some of our
shipowners are engaged in building an
amusement park and a new hotel in
Fosnavåg because they realise that job
security isn’t enough to attract the best
employees. We need to focus on establishing
an even better environment for raising
families, and we need a good variety of
recreational activities,” says Mr Goksøyr.
But more than anything, the mayor thinks
that the innovative spirit of the people of
Herøy and its neighbouring communities
is the region’s main competitive advantage.
“The maritime cluster is highly technology
focused. You have scientists working
day and night surveying fish, their tracks,
the speed at which they swim and much
more. People here have their finger on
the pulse when it comes to what customers
want and what their next moves will be,”
says Mr Goksøyr.
In the end, with value creation of close
to 300% over the past decade and a hightech
innovative environment, it is safe to say
that the future of Herøy and the rest of the
Norwegian maritime cluster looks bright.
28 – no 01 2012

I Mayor of Herøy municipality, Arnulf Goksøyr next to the statue “Fiskerkona” (The fisherman’s wife).
no 01 2012 – 29

+ Fosnavåg
“IF YOU CAN’T DREAM IT,
YOU CAN’T MAKE IT”
STIG REMØY IS THE CO-FOUNDER AND CEO OF OLYMPIC SHIPPING AS, A SHIPPING COMPANY THAT SPRANG UP ON
THE FOSNAVÅG SCENE SOME 15 YEARS AGO. TODAY, HE IS ONE OF FOUR SHIPOWNERS WITH ORIGINS IN REMØY –
A SMALL ISLAND WITH JUST 200 INHABITANTS LOCATED CLOSE TO THE CENTRE OF FOSNAVÅG.
What started out as an adventure
with just three vessels in 1996
has grown into a top-performing
company of some 22 high-tech vessels
today. Over the past 15 years, the company
has invested close to NOK 10 billion in
offshore supply vessels with cutting-edge
Norwegian design and technology and
business has flourished – leaving Olympic
with a comfortable profit level and a turnover
of more than NOK 1 billion. Today,
the company operates offshore supply
vessels all over the world. This expansion
seems to be continuing, because these
days Olympic is seeking new opportunities
in up-and-coming markets such as Brazil,
where the demand for offshore supply
expertise is exploding.
But where did it all start and how did
Mr Remøy get where he is today?
“MY HEART IS IN FISHING”
At the age of 19, Mr Remøy invested in
his first ship – a fishing vessel built in
1941 and owned by the Remøy family. It
was a major investment for a young man.
“My father provided a guarantee for my
share in the vessel, the Jan Mayen,” says Mr
Remøy. “This investment was my first
encounter with the maritime sector from
a business perspective. And that was it!
Fishing is where my passion lies and is the
breeding ground of my ambitions. Today,
I think it’s safe to say that part of the success
of Olympic can be attributed to experiences
and lessons learned from the fishing
industry.
“When I took over as captain of the
Jan Mayen at the age of 21, my ambition
was simply to be best at what I did. I
quickly discovered, however, that in order
to be the best captain I needed a vessel
equipped with the best technology and the
best people. So we equipped this old vessel
with high-tech equipment and the best
people. And that investment paid off.”
FROM FISH TO OIL
When Olympic Shipping was established
by Stig Remøy and his friend Bjørn
Kvalsund in 1996, two offshore vessels and
one trawler were what they could afford.
Their competitive advantage at that time
was their knowledge of the fishing industry
and technological know-how. As it
turned out, experience of and expertise
in the fishing industry were an incredible
strength for those wishing to prosper in
the offshore supply sector.
“When the oil adventure started in the
North Sea, the technology used was mainly
American. However, some shipowners
from Herøy – with Per Sævik of Havila in
the lead – quickly discovered that offshore
supply ships and fishing vessels share many
similarities, such as design and equipment.
We saw an opportunity and took it. Today,
70% of the design and technology related
to offshore service vessels on a global basis
is Norwegian,” says Mr Remøy.
So Olympic started equipping its three
vessels with the best technology money
could buy. Says Mr Remøy: “We chose the
most expensive path, which didn’t correlate
with our financial situation or the
old vessels we were operating. But still we
managed to interest investors, based on
a promise to buy them out 6–12 months
later. That strategy worked and as early as
in 1998 we were in a position to invest in
the best and most advanced technology.
Since 1996, we have invested more than
NOK 10 billion in offshore and fishing
vessels.”
NEW OPPORTUNITIES
When Olympic was established in 1996,
its vessels operated exclusively on the
Norwegian continental shelf. Today – with
22 vessels in operation – only a handful
are located in Norwegian waters.
And the journey does not end there.
Together with other Norwegian offshore
supply companies, Olympic is experiencing
growing demand for high-tech vessels
in the North Sea. Trends such as more
extensive operation in deep waters, far
from shore and in harsh environments
further increase the need for the expertise
the industry has acquired over the years.
And the extreme drive for innovation so
characteristic of the offshore supply sector
30 – no 01 2012

I Stig Remøy in front of his office in Fosnavåg. “We saw an opportunity and took it.”
is an attribute that entices operators, oil
companies and other offshore enterprises
around the world to look to the Norwegian
maritime cluster for assistance. Brazil is one
such market where Olympic and the rest of
the Norwegian offshore supply industry is
facing great opportunities these days.
“Brazil represents unique and unparalleled
opportunities for the offshore supply
industry. Companies here are moving from
shallow to deep waters and are looking for
expertise. Olympic will be a part of this
adventure,” says Mr Remøy.
AN ENVIRONMENTALIST
Mr Remøy is a man of ambition also when
it comes to environmental performance.
In its vision, Olympic emphasises its
responsibility towards the environment.
However, the path towards a focus on the
environment in shipping has been long.
Mr Remøy recalls: “The first vessel contracted
by Olympic in the mid-1990s had
one of the first diesel-electric engines.
At that time, these vessels were NOK
12–15 million more expensive than those
with diesel-mechanical engines. Today,
although far from being where we should
be, everybody talks about environmental
management in shipping. And Olympic is
indeed walking the talk when it comes to
the environment. The company operates
several diesel-electric hybrid propulsion
offshore construction vessels. As opposed
to crude oil tankers where the ratio of
steel to technology is 80/20, these vessels
contain 80% technology and 20% steel.
Furthermore, they represent a 95% reduction
in NOx emissions and a 50% reduction
in energy consumption compared to
conventional vessels. And what is more,
the company is currently building a liquefied
natural gas (LNG) vessel which will
represent a 92% reduction in NOx emissions,
a 23% reduction in CO2 emissions,
a 100% reduction in SOx emissions and in
the emission of particles compared to conventional
vessels.
THE PROFESSOR
In the end, however, Mr Remøy believes it
is not enough for the industry to invest in
innovation and new technology.
“If Norway is to continue to excel within
this sector, we need to acquire even more
knowledge and expertise. That is something
the education system must also take
into account. Olympic has therefore sponsored
a professorship at Ålesund University
College for the past year.
“In the end,” says Stig Remøy, “it comes
down to the ability to dream and be innovative.
Like Walt Disney said – If you can’t
dream it, you can’t make it.”
no 01 2012 – 31

+ Fosnavåg
LIVING AN ADVENTURE
“WHEN OIL WAS DISCOVERED IN THE NORTH SEA, IT WAS CLEAR TO US THAT RUNNING A LARGE SUPPLY VESSEL AND
A LARGE FISHING VESSEL WERE TWO VERY SIMILAR OPERATIONS. SO WE TOOK A CHANCE. AND WE SUCCEEDED,”
SAYS PER SÆVIK, FOUNDER OF HAVILA SHIPPING ASA.
Per Sævik is a key figure in the offshore
supply adventure that swept
Norway off its feet in the 1970s. His
name is widely known on the Norwegian
maritime and political scene. Not only
has he been president of the Norwegian
Shipowners’ Association, but he is also a
former mayor of Herøy and was a member
of the Norwegian parliament from 1989
until 1993. And Mr Sævik is by no means
resting on his laurels – as he still holds
many prestigious positions in the public
and private realm. Today, after successfully
building up and selling two shipping
companies, Mr Sævik is in charge of one
of Norway’s most profitable shipping conglomerates
– Havila – a company that is
in many ways a maritime cluster in itself,
comprising expertise in everything from
ship design to shipbuilding.
Norwegian offshore
industry
Norwegian offshore companies are usually
located in small communities with long
traditions of working in the fisheries sector.
The companies themselves have a strong
research base that goes back 40 years, and
the relations between offshore companies,
yards, ship designers, maritime banking and
the maritime supply industry are unique.
Currently, Norway has the world’s secondlargest
offshore supply fleet, only surpassed
by the United States. However,
the Norwegian offshore supply vessels are
larger, more specialised and more technologically
advanced.
Mr Sævik was a pioneer with regard to
seeing the vast opportunities for the Herøy
community in the offshore sector. In the
late 1960s when the first oil was discovered
in the North Sea, Mr Sævik was, like other
Herøy shipowners, active in the fishing sector.
Fishing is still an important industry in
Herøy, and today the municipality accounts
for close to 10% of the total revenue from
Norwegian fishing. However, as the expansion
within the fishing industry became less
predictable, the opportunities within the
offshore industry became evident to Mr
Sævik. This foresight turned out to be a
gold mine for the Herøy community.
Havila Shipping ASA, Per Sævik’s third
shipping company, was established in 2003
and has its head office in Fosnavåg. Today
Havila has a very modern fleet and operates
27 vessels, 17 of which have joined
the company since 2005. The vessels are
highly specialised, ranging from platform
supply vessels to anchor handling tug supply
vessels and rescue and recovery vessels.
The total market value of the Havila fleet
is close to NOK 5–6 billion. Havila’s goal
is to be the leading provider of qualityassured
supply services to offshore companies,
both national and international.
Part of its competitive advantage lies in its
in-house maritime cluster.
A CLUSTER IN ITSELF
Says Mr Sævik: “What differentiates Havila
from other companies is that Havila is a
cluster in itself; designer, owner, yard, supply
ships and equipment. And our aspirations
are growing. Havyard Design – the
Havila ship designer – has offices in countries
such as India, Brazil and Singapore,
to name a few. Our ambition is to go far
beyond the Norwegian continental shelf,
although this area will remain very important
to us.”
The main market for the Havila fleet is
the North Sea and the Asia Pacific region.
Brazil has also become an interesting market,
and three Havila vessels are currently
working there on long-term contracts with
Petrobras.
Says Mr Sævik: “Brazil is a market filled
with opportunities. However, due to cultural
differences and language barriers,
it is a more demanding market for us
than the North Sea. So we hire the best
Brazilians to work for us, and we have
ambitious goals.”
A COMPETITIVE SPIRIT
Herøy and its neighbouring municipality
of Ulstein are indeed in a league of their
own with regard to value creation on the
Norwegian mainland. According to Mr
Sævik, it was Idar Ulstein – the founder
of Ulstein Shipyard – that first helped
him and several of his colleagues into the
offshore supply industry. Today, the density
of maritime companies in Herøy and
Ulstein is very high, and the manner in
which they cooperate in a cluster is unique
– with designers, shipyards, ship owners,
suppliers of equipment, banking systems
and operators working closely together
to boost value creation and profit in the
industry.
Says Mr Sævik: “One of the advantages
of Herøy and Ulstein is the close and
intimate relationships within the cluster.
This was essential in the switch from fish
to offshore, and it is also how we main-
32 – no 01 2012

“Internationalisation is the key for many businesses in
rural areas of Norway. However, you must prove that
you have learned your lesson at home before you can
make it in the international market,” says Per Sævik,
founder of Havila Shipping ASA.
tain our high degree of innovation today.
Furthermore, it is an advantage that the
dialogue and relations between the various
players in the industry are informal. These
relationships are characterised by loyalty.”
Mr Sævik thinks that a healthy dose of
competition is part of the reason for the
incredible success over the past few years.
“I think Herøy is where it is today largely
as a result of its roots in fishing – and fishing
has always been strongly competitive.
In short, we cooperate where we can and
compete for the rest. And you will find
that there is an extreme willingness to
take risk in this region. People here have
an independent spirit – and this spirit has
taken them far,” says Mr Sævik.
LOCAL COMMUNITY
Like his fellow shipowners in Herøy, Mr
Sævik is preoccupied with giving back
to the local community. This is not only
because he feels gratitude towards his
neighbours, but also because he realises
that in order to attract employees to Herøy,
the community needs to offer something
more than just a good and stable income.
“If Fosnavåg is to remain an attractive
coastal town, we need to invest. This is
social responsibility. Work is a blessing,
but it is important that we make it more
lucrative for our youth to stay and not
move to the bigger cities. One way to do
this is through investing in their well-being
and prosperity. That means investing in
recreational activities, hotels, schools and
much more. If we don’t, we will lose the
best people,” says Mr Sævik.
no 01 2012 – 33

+ Pipeline infrastructure
TOWARDS
NEW OWNERSHIP
ON THE NORWEGIAN
CONTINENTAL SHELF
THE OWNERSHIP OF THE GAS INFRASTRUCTURE ON THE NORWEGIAN CONTINENTAL SHELF IS CHANGING HANDS.
WITH ENERGY COMPANIES SELLING SHARES IN THE 8,000 KM LONG PIPELINE INFRASTRUCTURE THAT ENSURES ENERGY
FOR A MAJOR PORTION OF EUROPE, NEW TYPES OF OWNERS ARE MOVING IN – INVESTMENT FUNDS AND CONGLOMERATES
WITH STRONG INFRASTRUCTURE EXPERIENCE BUT LIMITED NATURAL GAS KNOWLEDGE.
TEXT: JANNICKE WITSØ PHOTO: NINA E. RANGØY
“The Norwegian gas infrastructure’s availability
and reliability will not be affected by
this change of hands,” says Head of Business
Development and Finance at Gassco, Thor
Otto Lohne. “In addition to the new owners’
skills, we will still have the operational
experience and technical knowledge of the
exiting companies since they are significant
users of the transport system.”
Today Gassco controls the delivery of
20% of the total supply of gas in Europe.
The gas infrastructure connects the gas
producing wells on the Norwegian continental
shelf, the onshore gas processing
plants and the receiving terminals in four
European countries. Precision, punctuality
and predictability are mandatory for
Gassco, which monitors every single gas
movement and transaction 24 hours a day.
NEW KIND OF OWNERSHIP
Gassco was established by the Norwegian
authorities in 2001 as an independent gas
infrastructure operator, to ensure that the
agreed service quality is delivered to the
users of the transport system at all times.
Mr Lohne elaborates: “Given Norway’s fortunate
situation when it comes to its abundance
of natural resources, our mandate is
to operate and develop the gas transport
system so that the discovered petroleum
resources can result in maximum value
creation.”
The owner of the gas infrastructure itself,
on the other hand, is Gassled – a joint
venture owned by oil and gas producing
companies on the Norwegian continental
shelf. Their participation in Gassled was
originally based on their expected usage
of the gas infrastructure. But increasingly,
the conventional owners seem to be finding
ownership less important and are moving
out – introducing new and unfamiliar
faces.
So far, four of the big owners in Gassled
– ExxonMobil, Total, Statoil and Shell –
have announced the sale of their stakes to
investment funds.
Says Mr Lohne: “Part of the reason why
we are seeing oil and gas companies selling
is the relatively low return on investment,
which on the other hand is regarded as
interesting for investment funds that are
looking for low risk and stable returns.
Furthermore, I believe some of the oil
and gas companies have sold their shares
because of the increasingly regulated
European gas market, which has made it
less advantageous for gas producers to also
be on the owner side.”
The new owners bear no resemblance to
the conventional owners, and their experience
and knowledge when it comes to natural
gas may be limited. With investment
portfolios including such diverse sectors as
railways, infrastructure, pharmaceuticals
34 – no 01 2012

I “Part of the reason why we are seeing oil and gas companies selling is the relatively low return on investment, which on the other hand is regarded as interesting for investment
funds that are looking for low risk and stable returns,” says Thor Otto Lohne, Head of Business Development and Finance at Gassco.
and now gas infrastructure, their level of
insight cannot be expected to equal that
of Statoil, ExxonMobil, Total and Shell.
But surely this must have some implications
for the operations on the Norwegian
continental shelf, and not least for Gassco’s
role?
IMPLICATIONS FOR THE NORWEGIAN
CONTINENTAL SHELF
Mr Lohne says there is a need to review
the work and decision-making processes
of the new owners. However, in his view,
extensive stakeholder dialogue is imperative
to successful business. In the end, he
does not envisage major implications for
the operations on the Norwegian continental
shelf.
“I don’t foresee any big changes. The
quality and predictability of Norwegian gas
supply will remain high, and we will continuously
take the necessary steps to ensure
that. The new owners will have a seat at
the table and be represented by people
with relevant expertise in the Norwegian
gas infrastructure. But the most important
thing, I think, is to have an open, transparent
and comprehensive exchange of views
with the users – the gas producers and sellers,”
says Mr Lohne.
In the end, for any business entity
involved in the transport of energy to millions
of people, it is the quality and predictability
of supply that matter the most.
Says Mr Lohne: “Let there be no doubt:
Ensuring a predictable and high quality
gas supply is, and will remain, a key issue
to manage in our operations.”
And, with an impressive delivery rate of
98.8% in 2010, Gassco is certainly placed
as a predictable supplier of energy to a
volatile European economy.
Owners of Gassled
Petoro AS
Statoil Petroleum AS
ExxonMobil Exploration and
Production Norway AS
Total E&P Norge AS
A/S Norske Shell
Norsea Gas AS
ConocoPhillips Scandinavia AS
Eni Norge AS
DONG E&P Norge AS
GDF SUEZ E&P Norge AS
RWE Dea Norge AS
as of 31 December 2010
no 01 2012 – 35

+ Oil and gas
UNDER THE WAVES
CEO STEINAR RIISE AT NORWEGIAN START-UP COMPANY OCEAN INSTALLER HAS HIS LONG-TERM SIGHTS
ON A BIG SHAREOF THE INTERNATIONAL OFFSHORE SURF MARKET, EYEING A TURNOVER
OF USD 500 MILLION WITHIN FIVE YEARS.
TEXT AND PHOTOS: KAIA MEANS
There is no lack of ambition among
the people behind the start-up of
Ocean Installer. Their sights are
set on growing from a turnover of zero to
USD 500 million in just five years. At present,
the company has 60 employees and
has just signed its first contract, a technical
study for ConocoPhillips. It also has a ship
lined up for a five-year contract starting
in May – Solstad Offshore’s MS Normand
Clipper.
Ocean Installer
Ocean Installer aims to cover the full
engineering, procurement, construction
and installation (EPCI) value chain for the
offshore industry. Being a start-up company,
it wanted to establish best practice
processes and procedures. DNV assisted
Ocean Installer in aligning objectives,
strategies and actual way of operating
through:
formulating the strategy with
a visionand values
developing an integrated
management system
aligning the design of processes
and procedures with relevant ISO
and OHSAS standards
establishing a risk management
framework
establishing business frameworks
for effective software selection
and development.
At the head of its team sits a person who
has been part of a story of similar growth
in the subsea, umbilical, riser and flowline
(SURF) market before.
“I’m a visionary person,” admits CEO
Steinar Riise. “I see possibilities instead of
problems in most things. I have been very
conscious about always having good people
working close to me, so we as a strong team
can make things happen.”
His career started as a project engineer
in Brown & Root, based in Stavanger.
There have since been many takeovers
and mergers in the subsea market, and
Mr Riise spent most of his previous career
with Subsea 7. As Subsea 7 Norway’s
Commercial Director from 2005 to 2008, he
had only one assigned task, merely to triple
the annual revenue over a three-year span.
DRAMATIC LIFT
“That’s a significant lift for any company.
The whole organisation had to be lifted to
a new level. We made our targets, so I was
satisfied,” he says. He has been involved
in all aspects of SURF, both technical and
commercial. When the merger of Subsea 7
and Acergy was announced, several people
on the Subsea 7 team decided the market
needed a new player.
The idea took shape in January 2011
with the backing of Hitech Vision who
invested through the HitecVision Asset
Solution fund. Mr Riise emphasises that
many highly experienced people in the
business have already been hired by Ocean
Installer and that the Normand Clipper
is a well-known ship in the industry.
“The subsea industry is like a small
family. Everybody knows everybody. The
Normand Clipper was renovated in 2005
and her capability is well known,” he says.
The company is in an intensive hiring
period now, including in Aberdeen, and
plans to have 150–200 employees by the
end of 2012.
TRENDSETTER
“ We are going to be a trendsetter, building
our business on known technology
and experienced personnel. They have
ideas for improving systems that would be
very tough to implement in a large, heavy
organisation. With us, they can just do it.”
At first, Ocean Installer will be looking
only to the North Sea market, but by 2014
it will be expanding its view to include the
global market, with Australia and Mexico
first in line. Brazil and West Africa are also
seen as potential markets. The company
will order a new Construction Support
Vessel (CSV) with delivery in late 2013.
As one of the largest of its kind, this vessel
will support the global SURF market.
Mr Riise believes that one of Ocean
Installer’s main strengths is that its new
and small organisation will be highly flexible,
with straight lines from the customer
to the top decision-makers.
“Customers will know that they’re not
just a number in a row; they will enjoy all
our attention. In addition, employees will
36 – no 01 2012

I “We’re going to be a trendsetter, but not through new technology,” says Steinar Riise, the CEO of Ocean Installer.
be able to influence the direction of the
company,” he says, adding that the investor,
HitecVision, has signalled by its support
that the ambitious goals are seriously
within reach.
Having been part of the enormous
growth of a small company to a big one,
the drive to achieve something similar
again is his motivation.
“The most important reward is the job
itself. We want to have fun at work,” he says.
Thinking big has become a habit for Mr
Riise, who is married with six children from
the ages of 3 to 14. There are plenty of
family logistics to take care of during the
weekends, shuttling kids to various soccer
and hockey matches. This would appear to
be a ‘piece of cake’ for somebody who has
experience of handling the most complex
projects for the oil industry. In any case,
Mr Riise does not shy away from handling
complexities. He relishes the challenge.
“When I was with Brown & Root and
Subsea 7, we went from a schedule with
four ships and grew to 25 ships. I want to
be part of that kind of adventure again,”
says Mr Riise.
no 01 2012 – 37

+ Corporate responsibility
© K ong ngsb
sbe berg Mar
ritime
KONGSBERG in brief
Through its operations on five continents, Norway-based KONGSBERG is continuing to expand its reach, product range and distribution systems
into new and existing markets. With the aim of further strengthening its international operations, the Group is well equipped to provide 24/7
customer service, technical support and distinctive high-end systems and products. The Group employs close to 6,500 people and has offices
in more than 25 countries.
38 – no 01 2012

A VALUE-BASED
TECHNOLOGY LEADER
TECHNOLOGY KNOW-HOW, STRONG CULTURE AND INTERNATIONAL FOCUS ARE MAJOR FACTORS PROPELLING
THE EXPANSION OF KONGSBERG, THOUGH ACCORDING TO PRESIDENT AND CEO WALTER QVAM, INNOVATIVE THINKING
AND MARKET CREDIBILITY ARE ALSO IMPORTANT FACTORS.
TEXT: STUART BREWER PHOTO: NINA E. RANGØY
Throughout the world, most industries
are in a state of transformation.
increasing competition, new technologies,
global value chains and uncertainties
related to the global economic
situation are everyday challenges facing
global companies.
To KONGSBERG, a technology corporation
that is one of the leading suppliers
of sophisticated systems and products
to the maritime, oil & gas, space and
defence industries, these challenges also
represent opportunities. “KONGSBERG
has grown significantly, mainly through
product development, global expansion
and key acquisitions, as well as
through competence development,” says
Walter Qvam, the President and CEO of
KONGSBERG. “This has served us well
and our strong focus on collaboration
with our customers and being seen as a
very reliable organisation has been, and
will continue to be, key for us.”
KONGSBERG’s performance in recent
years is a story of growth in revenues as
well as in profitability. “Our progress has
been steady and almost all our areas have
improved in recent years,” says Mr Qvam.
“Our second quarter results this year show
that the Group is maintaining a high level
of activity in virtually all key segments. The
order backlog remains stable at a high level
and ongoing efficiency measures are supporting
continued profit levels. Further,
our market shares are continuing to grow
and we are working on significant new
business and technology opportunities that
have great potential. This combination
provides a robust commercial platform
for KONGSBERG, and this is particularly
important for us given the uncertain global
market situation.
“All businesses have a desire to grow
and improve their financial performance
– and these are important drivers for
KONGSBERG too. However, for us, the
ability to adapt quickly and deliver innovative
systems, products and services that
improve safety, security and efficiency are
equally important,” emphasises Mr Qvam.
FULL OPERATIONAL PICTURE
KONGSBERG is continually developing
its position as a high-end supplier of systems,
products and services to its customers.
“Although delivered to very different
industries, there is a strong commonality
in KONGSBERG’s systems and products.
“It’s all about delivering systems that help
the operator make the optimal decisions
or run the optimal operations – by always
having the full operational picture available
in the control room environment –
at sea, in space or during defence operations,”
points out Mr Qvam.
“Our vision – World Class – through
people, technology and dedication –
forms the basis of our ambition. We have
described our value proposition as ‘Extreme
performance for extreme conditions’
because KONGSBERG’s solutions are often
used by operators that undertake complex
and challenging tasks in difficult situations.”
Mr Qvam has definite views on how
KONGSBERG is to further its standing in
the marketplace. These include a continued
and even strengthened focus on quality,
research and development and internationalisation.
“We also place great emphasis
on the importance of the KONGSBERG
culture, and our values and ethical standards
describe how we should work and act
to achieve our ambitions,” he says.
He continues: “Our future growth
and business strategy are centred around
this framework and focus on a strong performance
culture, partner collaboration,
I KONGSBERG Maritime’s K-Bridge integrated bridge system including ECDIS electronic chart display, ARPA radar, propulsion control system and conning display.
no 01 2012 – 39

+ Corporate responsibility
strategic alliance building, internationalisation,
strong product development, global
customer support and continuous improvement
programmes.”
Some 84% of KONGSBERG’s revenues
come from international markets, giving
the company confidence in international
expansion. The Group has a strong foothold
in the Far East, having long-standing
relationships with several leading shipowners
and shipyards in Singapore, South
Korea and China.
ETHICAL SUPPLY CHAIN MANAGEMENT
As part of its efforts to enhance its competitiveness
and value creation, KONGSBERG
has developed an ethical supply chain
management programme. Nils Molin,
KONGSBERG’s Corporate Social
Responsibility (CSR) Manager, explains,
“Our growing international initiatives and
growth expose us to new, more obvious
challenges related to human rights, labour
rights, corruption and environmental and
climate issues, either directly through our
own operations or indirectly through our
value chain. This means that we continuously
strive to ensure that we comply with
international guidelines and our own
guidelines in these areas. This programme
runs in a parallel with our anti-corruption
programme managed by our Compliance
Department. Together, these two programmes
have been given top priority.
“We are affiliated with the UN Global
Compact initiative and have decided to
use the intentions embodied in the ILO
conventions, the OECD’s Guidelines for
Multinational Enterprises and the UN’s
Universal Declaration of Human Rights
as the basis for our CSR work.
SIGNIFICANT RISK
“Inadequate compliance with the said
principles in the supplier chain, whether
in the first link or further down the chain,
may translate into significant risk for
KONGSBERG in terms of the quality of
deliveries and the Group’s reputation,”
emphasises Mr Molin. “In addition, it is
our genuine conviction that good working
conditions and environmental practices
are positive in the long term for our business
as well as for our business associates.”
KONGSBERG hired DNV to assist in the
development of its ethical supply chain
management programme. Its cooperation
with DNV goes back many years and mainly
involves work relating to the maritime
segment. DNV has also assisted the Group
with environmental reporting and, more
recently, its climate strategy.
“We know the people at DNV and we
know that they stand for quality. That’s
why we chose them for the project involving
CSR in the supplier chain,” says Mr
Molin. “We know that DNV has good experience
and expertise in this field, given the
work they have done for other companies.”
The project will develop a strategy to systematically
identify and manage corporate
responsibility risks in the Group’s supply
chain. This includes establishing supplier,
monitoring and auditing performance,
engaging high-risk suppliers to improve
practices, and setting up an internal organisational
structure to manage the Group’s
supply chain activities.
SUPPLIER CONDUCT PRINCIPLES
“To clarify the Group’s sustainability
expectations vis-à-vis suppliers, we have
developed Supplier Conduct Principles.
These principles cover a wide range of
issues such as human rights, labour standards,
the environment and anti-corruption,
and are based on international standards
in the area,” explains Mr Molin.
The project is one of the Group’s official
CSR targets and has been reviewed and
approved by the Board of Directors. The
project is also firmly anchored in the corporate
executive management and in the
various management groups in the business
areas.
NEW FIELD…NEW EXPERTISE
“The importance of providing information
and anchoring the processes at the
management level and with all those
involved on the operational level cannot
be overestimated,” says CEO Mr Qvam,
who adds: “This is a new field and it calls
for new expertise and new routines, meaning
that the process may engender some
uncertainty in the organisation. It can
also be a challenge when results are not
directly reflected in improved earnings but
rather in reduced risk and better quality
deliveries, both of which are more difficult
to measure. By the same token, it is important
that this work is implemented in existing
processes and that we set goals, review
reports and ensure follow-up at management
level. Full management support is
crucial to success.”
According to Mr Molin, one of the
main points relative to the Group’s work
on CSR challenges in the supplier chain
is the individual supplier’s willingness to
make improvements. “We don’t expect all
suppliers to comply with every single one
of our supplier conduct principles from
day one, but we do expect each supplier
to demonstrate a willingness to redress any
non-conformity found and to participate
in systematic improvement work. It is still
early days for this programme. During the
first year, we plan to take many small but
important steps and then re-evaluate the
entire process as we go forward.”
“Our business backbone is first and
foremost a high market standing. We are
operating with credibility and we work
with credible suppliers. This has and will
support our comprehensive portfolio of
products and strategic business alliances,”
concludes Walter Qvam.
40 – no 01 2012

I “The key to success is having leading technologies, a strong culture and values platform and solid financial performance, as well as market credibility and an innovative way of
doing things,” agree Nils Molin KONGSBERG’s Corporate Social Responsibility Manager (left) and Walter Qvam, the President and CEO of KONGSBERG.
no 02 2011 – 41

+ Management systems
FEEDING
THE WORLD
WITH LESS ARABLE LAND AND MORE PEOPLE TO FEED IN THE WORLD,
THE SOLUTION LIES IN NEW TECHNOLOGICAL SOLUTIONS AND IMPROVED AGRICULTURAL PRODUCTIVITY.
TEXT: JANNICKE WITSØ PHOTO: NINA E. RANGØY
42 – no 01 2012

I Yara is the world’s largest supplier of mineral fertilizer. “Using the best agricultural practices is key to ensuring a food supply for the growing world population.”
no 01 2012 – 43

+ Management systems
I “We realised we wanted our own tools in order to
ensure good management systems. So we sat down
with DNV,” says Tore Jenssen, Director for HESQ and
Product Stewardship in Yara.
Food security is perhaps the most
severe global challenge facing mankind
today. Unfortunately, the state
of our climate further complicates the
picture – with negative and severe effects
on growing conditions. Access to water is
just one of many issues at stake. More food
needs to be produced for more people
from less resources. With limited land
available, 90% of the growth in crop production
is expected to come from new
and innovative solutions.
Yara is a global company specialising
in crop nutrition and industrial solutions.
The company is currently the world’s
largest supplier of mineral fertilizer. In
addition, it provides industrial products
and environmental solutions to markets
around the world. Based on more than a
century of experience of manufacturing
and applying plant nutrients, Yara believes
that sustainable agriculture will be part of
the solution to the food crisis – and to climate
change.
Says Tore Jenssen, Director for HESQ and
Product Stewardship in Yara: “Today, almost
half the world population relies on mineral
fertilizers for their food. With arable land
per capita decreasing fast, agricultural productivity
needs to increase dramatically. At
Yara, we believe that using the best agricultural
practices is key to ensuring a food supply
for a growing world population. What’s
more, these best practices protect the
environment. Sustainable agriculture is part
of the solution to some of the global challenges
we are faced with today.”
Yara has many hi-tech products, ranging
from its low-carbon-footprint fertilizers to
its many best practice application tools that
preserve land and maintain yields. However,
its current lead in the global debates and
deliberations on climate change and food
security can also be attributed to the company’s
unrelenting focus on strict standards
of health, safety, environment, quality and
product stewardship.
SAFETY AT WORK
Yara’s HESQ and Product Stewardship
policy sets out a zero goal for injuries and
44 – no 01 2012

“Today, almost half the world
population relies on mineral
fertilizers for their food.”
occupational illnesses, as well as for accidents
and environmental incidents. The
working guideline is that every accident is
preventable. Similarly, environmental challenges
are specifically addressed in Yara’s
health, environment and safety activities.
In 2010 it was the first fertilizer company
to launch a campaign focusing on reducing
its products’ environmental footprints.
Yara’s activities are also guided by the
principles of product stewardship, as set
out by Fertilizers Europe. These guidelines
ensure that the entire value chain is scrutinised,
from product development and the
purchase of raw materials, through production,
storage and distribution, to sales,
delivery and usage.
“At Yara, we set very high standards for
ourselves. And we realise that, in order to
be the best and have the highest productivity,
you need the best management systems.
We believe that good safety systems
are key to the entire business. That’s why
we decided early on to hire a third party
to certify that our operations were in line
with our high standards,” says Mr Jenssen.
In 2005, Yara asked DNV to review its
internal systems.
Says Mr Jenssen: “We realised we wanted
our own tools in order to ensure good
management systems. So we sat down with
the DNV experts and had a thorough look
at our systems. This turned out to be a very
valuable collaboration. We felt safe when
DNV, a global provider of certification
services, helped us identify our own risks
and then told us how to manage these with
the right set of tools. Their guidance and
reassurance were important to us. We now
have a global frame agreement with DNV
on all management systems certification.”
Like several other industries, the fertilizer
business is faced with many challenges,
including stricter product quality requirements,
more focus on safety and environmental
issues, climate change, production
of healthy food, soil protection and biodiversity,
water scarcity, and the risk of misuse
of fertilizers for terrorism. “It is evident
that HSEQ will become increasingly important.
And we realise the importance of
our product stewardship program,” says
Mr Jenssen.
Today, in addition to being certified
to the international ISO 9001 Quality
Management Systems standard, Yara has
been certified to the ISO 14001 Environmental
Management Systems standard and
the OHSAS 18001 Occupational Health
and Safety Management Systems standard,
and to the European Industry’s Product
Stewardship System.
SUSTAINABLE AGRICULTURE
With its best practice experiences at hand,
Yara is looking at new ways of contributing
to a sustainable future in which the world
supply of food matches the demand – and
where agricultural yields are optimised.
Says Mr Jenssen: “We’re witnessing an
increasing specialisation in agriculture.
The world needs food to be produced as
cheaply and efficiently as possible, so precision
agriculture will become increasingly
important. Let me give you one example –
in traditional agriculture today, about 50%
of the mineral fertilizer disappears into
the air or soil without the plants having a
chance to take advantage of it. Now, with
new tools we have developed together with
farmers, the plants manage to absorb 80%
of the mineral fertilizer.”
In addition to producing high-quality
plant nutrients, Yara provides advice to
farmers and other industry players.
“Through advising farmers to deliver nutrients
to crops according to specific needs,
the farmers’ profits increase and so do the
benefits to the local environment,” says Mr
Jenssen.
In his mind, the main challenge facing
the future food supply is climate change
leading to shortage of water. But Yara is
working on a solution.
Says Mr Jenssen: “We’ve increased our
R&D efforts and are now looking into ways
of predicting when plants need water.
What we’re studying is the plant’s diet. We
are not medicating them. A healthy plant
is a result of a healthy diet. It has less need
of medicines. It’s the same for people.
People who consume the right nutrients
have good health.”
no 01 2012 – 45

+ Sustainable business
A GREEN LIGHT
ON THE HORIZON
SINCE IT WAS FOUNDED JUST FOUR YEARS AGO, AUSTRALIAN COMPANY COOL NRG HAS DELIVERED THE WORLD’S FIRST
ENERGY EFFICIENCY ‘CDM PROGRAMME OF ACTIVITIES’ – NOT ONLY REDUCING CO2 EMISSIONS AND IMPROVING ENERGY
SECURITY IN A DEVELOPING COUNTRY, BUT ALSO REDUCING ENERGY POVERTY ON AN UNPRECEDENTED SCALE.
TEXT: HANNE CECILIE NORSET CHRISTIANSEN PHOTOS: NINA E. RANGØY
primary focus is to deliver
mass energy efficiency campaigns,”
says Nic Frances, “Our
founder and Executive Chairman of Cool
nrg. “But our secondary focus is to do
things – with a bias – for the most disadvantaged
people in communities.”
Delivering sustainable solutions on global
warming, and reducing poverty levels whilst
at it, may sound like a daunting task. Cool
nrg, however, is fully committed to doing
both, paving the way for a new approach
to climate change, which could very well
have a revolutionary impact in developing
countries.
“Hearing world leaders at the Davos
World Economic Forum discuss global
warming, it really struck me that climate
change was actually becoming one of
our biggest social issues,” he says. “The
extreme consequences we knew were possible
already ten years ago, with hundreds
of millions of people losing their homes,
made then poverty levels pale into insignificance.”
Mr Frances started devising strategies for
reducing CO2 emission more rapidly than
the long-term renewable energy solutions
that were being discussed at the time.
Spotting an opportunity in a newly started
carbon market in New South Wales,
Australia, he set out on a project to give
away energy efficient light bulbs to households,
effectively selling the credits to
power companies who had to show that
they were aiming to create energy efficiency.
“We managed to reach nearly 60% of
the homes in New South Wales, and that
opportunity of scale in doing energy efficiency
became very exciting,” he says.
THE CLEAN DEVELOPMENT MECHANISM
This experience inspired Mr Frances to
start researching the UN’s Clean Development
Mechanism. One of three flexible
mechanisms set up with the Kyoto Protocol,
it was designed to help developed countries
meet emission targets by enabling them to
purchase offsets created by CDM projects
in developing countries. As he explains,
the thought was to simultaneously allow
developing countries to leapfrog the
problem of meeting future emission targets,
by helping them achieve sustainable
development in the process.
“The problem was that most of the CDM
activity was going into industrial activity in
countries like India and China,” he says.
“While that was great for reducing overall
CO2 emissions, it was doing nothing to
alleviate energy poverty.”
He discovered a part of CDM called
Programmatic (or PoA – Programme of
Activities), which allows several smaller
voluntary projects to be validated as larger
carbon credit deliveries.
“At that point no one had done a PoA
yet, mainly because it is extremely complicated
and costly,” he explains. Taking on
an enormous personal risk, Mr Frances set
up Cool nrg with the intention to use PoAs
to catch emissions on a large scale, by giving
energy efficiency directly to the poorest
people in communities.
LUZ VERDE – THE GREEN LIGHT
In 2009, Cool nrg successfully completed
a pilot project in partnership with the
Mexican government in the Mexican district
of Puebla. Aptly named Luz Verde
(meaning ‘green light’), the project saw a
million energy-efficient light bulbs distributed
to poor households in less than one
month. The project, which was validated
as a PoA by DNV, is not only the first-ever
Programmatic CDM project to be registered
and completed. Significantly, it will
46 – no 01 2012

I Nic Frances, founder of Cool nrg, has spent 20 years working in the not-for-profit sector, setting up businesses committed to using the market to deliver on social goals. It was
after being invited to attend the Davos World Economic Forum in 2001, as one of the world’s leading social entrepreneurs, that the imminence of climate change dawned on him.
no 01 2012 – 47

+ Sustainable business
also be the first to create carbon credits,
meaning Cool nrg has succeeded in delivering
profitable solutions on some of
today’s most pressing social issues.
“We had wonderful stories come out of
the Puebla pilot,” says Frances. “Poor families
were telling us that they were hearing
so much about climate change, but felt it
was really difficult for them to do their bit
to help. There was a feeling that Luz Verde
was their chance to contribute. Things like
that were really lovely to hear.”
“THREE THINGS, NOT TWO”
Mr Frances however makes it abundantly
clear that emission reduction is not the
only benefit to come out of the Luz Verde
experience. He explains that what makes
the energy efficiency PoA so extraordinary
is its ability to amalgamate all the social
goals which CDM was set up to deliver on.
“The exciting thing about our Mexico
pilot was that it turned to do three things:
Firstly, it cut emissions. Secondly, it created
energy security for the country, because
by cutting emissions, people were using
less energy so there was more to go round
– in other words improving a poor country’s
energy security. Finally, because you
were doing it with the poorest people, it
reduced energy poverty. That’s the most
interesting thing about energy efficiency
– it’s the only thing that does all three of
those things. Renewable energy development
and industrial energy efficiency do
cut emissions and do improve energy security,
but they don’t reduce the power bills
of the poorest people unless you give the
energy efficiency to them.”
DWARFING OFFICIAL DEVELOPMENT AID
In July, the Mexican government contracted
Philips and Cool nrg to deliver
their commitment to distribute a minimum
of more than 25 million light bulbs
to 6.5 million Mexicans (with an aim to
increase the number of bulbs to 50 million)
by Christmas. Mr Frances explains
that even if only the first round of light
bulbs are distributed, it will save, on average,
the recipient homeowners a month’s
salary every year for the next ten years.
Combined, those savings constitutes an
impressive $300 million dollars every year
48 – no 01 2012

I In 2009, Cool nrg successfully completed the pilot project Luz Verde (meaning ‘green light’) in partnership with
the Mexican government in the Mexican district of Puebla. The project saw a million energy-efficient light bulbs
distributed to poor households in less than one month.
– ten times as much as Mexico receives in
annual Official Development Aid from the
US (its largest donor). Mr Frances believes
treasury savings, as a direct result of the
individual household savings, could even
double that number.
“Together with DNV, we have taken on
huge risks to deliver something that has
turned out to become real anti-poverty
funded by the Mexican government and
potentially part funded through CDM, and
that is something we are very proud of.”
THE FUTURE IS OPEN-SOURCED
Cool nrg’s unique idea has attracted the
South African Standard Bank to take
an equity position in the company. Mr
Frances hopes this will help the Mexico
experience spread to African countries.
“Developing countries are the places where
CDM will be continuing, and for this to
most likely happen there is by using
PoAs,” he says. “Cool nrg obviously has
some real skills in that, and we will happily
take the job. But the most important
thing is that these countries have access
to the PoA in its own right.”
While he is adamant that energy efficiency
PoAs can benefit most developing
countries, he says the problem arises when
governments start off by looking for a
carbon benefit.
“It really is all about the strategy,” he
says. “Let us first of all have a conversation
about what’s the best strategy for energy
efficiency in the country we go into, about
how we meet our three commitments of
CO2 reduction, creating energy security
and reducing energy poverty. Then we
need to work out how to manage the
distribution, and ask how we are going to
fund it. That is not a matter of creating
carbon credits – it is a matter of making
sure the energy efficiency is working. If it
is, then we can start looking at whether all
is in place to start generating carbon, and
if that can partially or fully fund all the
activity. Getting that order right is crucial.”
While 20 years in the not-for-profit sector
may have taught Nic Frances a thing or
two about priorities, it has undeniably also
equipped him with an insatiable appetite
for social improvement.
no 01 2012 – 49

+ Health, safety and environment
SEARCHING FOR
THE IDEAL PROCESS
“A MINOR FAILURE CAN HAVE A HUGE IMPACT. IN THIS INDUSTRY, YOU NEED TO SEARCH FOR THE IDEAL PROCESS AND
ENSURE THAT YOU CARE FOR EACH INDIVIDUAL INVOLVED. THAT’S THE ONLY WAY TO ACHIEVE A SAFE AND SUSTAINABLE
BUSINESS,” SAYS FOUAD QABAZARD OF KUWAIT PETROLEUM INTERNATIONAL.
TEXT: PER WIGGO RICHARDSEN PHOTOS: KPI
Fouad Qabazard is the Group Manager
of Health, Safety & Environment of
a leading global oil company. Kuwait
Petroleum International (KPI) – known by
its trademark Q8 brand – was established
in 1983 to manage the refining and marketing
interests of its parent company,
the government-owned Kuwait Petroleum
Corporation, outside Kuwait. Today, KPI’s
portfolio of facilities includes some 4,000
filling stations, around 40 airport refuelling
facilities, four refineries (including
two in the planning phase) and three
lubricant blending plants, as well as supporting
storage depots, warehouses, jetties
and other infrastructure. These facilities
are concentrated in Europe and East Asia.
Years ago, when Mr Qabazard was new
to his position, he had to investigate an
incident at one of the company’s petrochemical
sites in Europe. A very senior
manager – who at that time had some 25
years of experience – said something that
struck a chord.
“Luckily no-one was seriously hurt that
time,” recalls the HSE manager. “But, as
with all incidents, we needed to know what
had really happened and why – to investigate
the underlying causes. The operating
manager used some simple words, saying:
“I didn’t know what I was doing was wrong.
No-one had told me. The training I had
been through had not corrected me.”
“I can’t forget what this experienced
manager told me. It really affected me.”
Mr Qabazard leaves us in no doubt. He
is really interested in achieving the company’s
overall goal; to sustain a level of
performance that is consistently superior.
He is interested in safeguarding the daily
working conditions of the person he met
after that incident and all the others working
for his company.
INTEREST PAYS OFF
And, when benchmarking against other oil
companies, he has shown that this interest
pays off. Concawe – a European organisation
carrying out research into safety and
environmental issues relevant to the oil
industry – has ranked Kuwait Petroleum
International’s overall performance among
the top quarter of companies.
“If that senior manager did not know,
how can we expect thousands of others in
our organisation to know? So, wherever
KPI does business we need to simplify and
make our procedures and routines userfriendly
and practical. We have to ensure
positive thinking, actively share information
within the company and with our stakeholders,
and further develop our safety
culture. The regular reporting of incidents
is of course crucial, but reports also have
to be simplified; they should not be overwhelming,
they must simply contain what
is needed. That way the content of the
report will be understood and we can all
learn from the incident, which is the main
objective.”
However, Mr Qabazard wants to share
the credit and results his company has
achieved over the past few years. “No-one
can walk alone,” he says. “In the same way
as we have to share experience internally,
we also have to search for best practices
and learn from outside. When following
up an explosion in one of our refineries
some ten years ago, we decided to bring
DNV on board. Your focus on asset management
and tools for process risk management
has been very useful and taken
our company closer to its ambitions.”
ZERO INCIDENTS BY 2020
One of Kuwait Petroleum International’s
strategic goals is to have zero incidents
and zero accidents by 2020. Due to this,
all types of injuries and losses have to be
reduced and each individual’s workplace
should be in safe surroundings.
The head of HSE continues: “Through
continuous improvements based on critical
50 – no 01 2012

“Wherever KPI does business, we need to simplify
and make our procedures and routines
user-friendly and practical.”
I Kuwait Petroleum International’s focus on one vision, one mission and one main direction is to be followed up by clear advice to all those involved.
no 01 2012 – 51

+ Health, safety and environment
I “Building trust and confidence is a must for Kuwait Petroleum International. One accident of any kind is one too many,” says Group Manager of Health, Safety & Environment
Fouad Qabazard.
views throughout our activities, we have
established one vision, one mission and
one main direction. This is not only a
management tool. In the end, this is
crucial and has led to clear advice to all
individual employees who are involved
at all levels.”
KPI’s current focus is on improving
its performance in process safety management
and crisis management and
understanding its risk portfolio. When
operating, for example, a filling station in
a city centre, especially when residential
development is continuing in the area, KPI
has to ensure that it continually reassesses
the associated risks and can demonstrate
suitable control of these risks to relevant
stakeholders.
TRUST AND CONFIDENCE
“Building trust and confidence is a must
for KPI,” emphasises Mr Qabazard. “One
accident of any kind is one too many. It
has to be easy for our neighbours to trust
us, and we have to communicate with our
stakeholders to ensure we are perceived
as trustworthy.”
When asked about his personal ambitions,
Mr Qabazard becomes more visionary:
“Remember, we are all as human beings
connected to each other. We need to protect
our communities, our local environment
and the global environment. We have
to take care of the world and ensure our
children and grandchildren have safe and
clean surroundings. My intention is to contribute
both personally and through my
management position in an industry that
has a huge impact.
“We have some results that prove our
contributions,” he proudly remarks, mentioning
that Q8 was the first company to
introduce unleaded fuel in Europe as early
as in 1985, and that it is currently trialling
environmentally friendly zero-carbon service
stations in Denmark and Italy.
52 – no 01 2012

Subsea technology +
DEEPWATER
TECHNOLOGY CENTRE
IN SINGAPORE
DNV HAS LAUNCHED A DEEPWATER TECHNOLOGY CENTRE IN SINGAPORE. THE AIM IS TO SERVE THE OIL AND GAS
INDUSTRY IN THE WHOLE ASIA PACIFIC REGION AND TO BECOME A SIZEABLE AND COMPLETE COMPETENCE CENTRE
FOR DEEPWATER OIL AND GAS DEVELOPMENTS.
TEXT: TORE HØIFØDT PHOTOS: NINA E. RANGØY
DNV’s long track record in R&D, experience
in the deepwater oil and gas industry,
and its strong position in developing industry
acclaimed technical standards, create a
perfect strategic fit with Singapore’s strategy
of becoming a hub for deepwater competence
in Asia. “The establishment of the
new Deepwater Technology Centre in
Singapore has become a reality due to
a very constructive cooperation with
Singapore’s Economic Development Board
(EDB),” said Remi Eriksen, who is in charge
of DNV’s operations in Asia and the Middle
East.
The Guest-of-Honour at the opening
ceremony, Minister of State for Trade and
Industry Mr Teo Ser Luck, affirms this
close relationship between Singapore and
DNV: “DNV and Singapore have enjoyed
a strong partnership over the years. With
the Deepwater Technology Centre,
Singapore would become DNV’s first and
only deepwater hub in the Asia-Pacific.
This will take our partnership to a higher
level. Thank you for this strong vote of
confidence in Singapore.”
“The Deepwater Technology Centre
will focus on three core sectors,” said
Alex Imperial, Managing Director of the
Deepwater Technology Centre. “The first of
these sectors includes subsea, umbilicals,
risers, flow lines and pipelines. Secondly,
we will focus on floating systems, including
production and drilling. Finally, it will
work within the fields of drilling and wells.
Our ambition is to have 55 highly qualified
professionals at the centre five years from
now,” he added.
I “We will capitalize on DNV’s 40 years of experience in
offshore and deepwater, and on the leading position of
our well established deepwater centres in Houston, Oslo
and Rio de Janeiro,” said DNV’s COO Remi Eriksen at
the opening ceremony in Singapore.
no 01 2012 – 53

+ Sea rescue
54 – no 01 2012

SAFEGUARDING
LIFE AT SEA
NORWEGIAN SEA RESCUE IS KNOWN
TO BE THE ORGANISATION
THAT GOES INTO BAD WEATHER
WHEN OTHERS LEAVE IT.
TEXT AND PHOTOS: CHRISTINA SMEBY
no 01 2012 – 55

+ Sea rescue
NOT A JOB
FOR EVERYONE
”COAST GUARDING IN THE NORTHERN WATERS IS NOT A JOB FOR EVERYONE,”
SAYS CAPTAIN FRED-TONNY HANSEN ON THE RESCUE VESSEL DET NORSKE VERITAS.
Any country with a massive coastline
has a history with the sea. The sea
gives life and takes lives, and it has
an unpredictable temper. The Norwegian
coastline stretches out over 20,000 km. It
has given Norwegians food and livelihoods
for centuries, but it has also been the main
reason why wives on land keep saying their
prayers at night. Fortunately, safety at sea is
better now than it used to be, but the dangers
of working at sea are always apparent.
From 1845 to 1854, 700 people lost their
lives at sea each year and, with a population
at the time of 1.5 million, the consequences
were devastating. In 1891, the
Norwegian Sea Rescue was founded to save
lives and property at sea.
As the backbone of Norwegian maritime
safety since it was established, the
Norwegian Sea Rescue is estimated to save
society approximately NOK 1.2 billion and
rescue about 30 people from certain death
each year. It is a humanitarian, voluntary,
membership-based organisation with 42
high-speed rescue vessels stationed strategically
along the coast, depending on
the season and demand. Fifteen of the 42
vessels are operated by volunteers, while
the remainder are manned by professional
crews who live and work on board.
A COMPLETE TOOL FOR SEA RESCUE
One of the vessels manned by a professional
crew is Det Norske Veritas. Partly sponsored
by DNV, this rescue vessel is a result of
close cooperation between DNV and the
Norwegian Sea Rescue to make a new type
of rescue vessel. It is built of aluminium,
has a total weight of 87.2 tons and is 22.5
metres long and 6.38 metres wide.
Det Norske Veritas is an example of a
high-speed (30-knot) rescue vessel with a
bollard pull of 20–25 tons. This makes it
flexible in its mission to reach the place of
emergency quickly and it has the capacity
to tow big ships to safety on its own. It also
has equipment to deal with fires, engine
trouble, etc.
Since the vessel was launched in 2003,
it has been a key performer in Norwegian
Sea Rescue operations. It has partaken in
1,031 missions in total; ten lives saved from
certain death, 21 craft saved from sinking
and 932 vessels assisted. It has been stationed
at numerous places along the coast,
currently stationed in Lofoten; the historic
fishing centre of northern Norway just
above the Arctic circle, where the winter
days are without sunlight and the summer
nights are without escape from sunlight.
That means the rescue vessel has two
very different seasons; in the summer it
deals with pleasure boats, ships and piloting
work. In the winter, it deals with herring
trawlers from October onwards and
winter cod trawlers from February to April.
A WAY OF LIFE
Captain Fred-Tonny Hansen, Engineer
Robbie Madsen and Officer Karl Evjen
make up one of two crews that man the
vessel for four weeks at a time. Fred-Tonny
has worked for the Norwegian Sea Rescue
for 16 years and has been with the DNV
vessel right from the start.
The vessel is not just the workplace for
the crew, it is also their part-time home.
The crew are on call four weeks at a time,
24 hours a day.
”There can be a lot of waiting around
on the job. Waiting is also a good thing, it
means that no one is in distress. You have
to be able to handle the waiting, and then
you have to handle the adrenalin when
something happens … It’s not for everybody,”
says the captain.
The ship now needs a thermal imaging
camera; local people have started to raise
money, and DNV has also contributed. The
Norwegian Sea Rescue will cover the rest.
A thermal imaging camera makes it possible
to find people in the sea by the temperature
change in the water. This makes
the search, especially in the dark
of winter, more likely to succeed.
Another part of keeping the coastline
safe has to do with the environment, and
the next development step is for the rescue
vessels to get equipment for preventing
the consequences of an oil spill.
56 – no 01 2012

I Captain Fred-Tonny Hansen, Engineer Robbie Madsen and Officer Karl Evjen at the rescue vessel Det Norske Veritas.
no 01 2012 – 57

+ Green innovation
© The Carbon Trust
I “We need innovation that delivers, stretching both minds and horizons. GBP30 million spent for a few billion saved is a no-brainer” – Benj Sykes, Director of Innovation at the
Carbon Trust
58 – no 01 2012

CREATING
“INNOVATION THAT
DELIVERS”
IN THE GREEN SPHERE, THE CARBON TRUST IS AT THE FOREFRONT OF STIMULATING THE DEVELOPMENT OF INNOVATIVE
SOLUTIONS WHICH AIM TO CONTRIBUTE TO THE DEVELOPMENT OF A LOW-CARBON ECONOMY – AND CUT COSTS.
TEXT: STUART BREWER
The renewables innovation community
has become increasingly important
in the UK as it has with the rest of
the world. This increased focus is exacerbated
by rising energy bills, thereby placing
the economic imperative on the energy
industry to reduce costs. Coincidentally
this has led to the development of and
investigation into innovative solutions
seeking to help developers and operators
reduce their costs. Among the leading players
stimulating the energy supply chain to
find effective solutions is the Carbon Trust,
the UK-based not-for-profit company.
“Put simply, our mission is to accelerate
the move to a low carbon economy. We
support the entrepreneurs who are developing
the next generation of low carbon
businesses in diverse industries, including
offshore wind,” says Benj Sykes, Director
of Innovation at the Carbon Trust. “The
UK is in the vanguard and it is exciting.
We see the power of the market, coupled
with smart policy, as the best route to costeffective,
low-carbon technologies. In
addition to tackling climate change, the
work we’re doing provides a stimulus for
economic growth.”
OFFSHORE WIND ACCELERATOR
The Carbon Trust’s ongoing work to stimulate
innovation in the markets for offshore
renewables has leveraged over GBP
55 million. Its work includes the Offshore
Wind Accelerator (OWA) programme, that
aims to cut the cost of wind energy by at
least 10% by 2020, by focusing on the
development of technologies that have the
potential to cut the capital, operating and
maintenance expenditure on offshore
wind farms, targeting typical conditions of
the UK’s Round 3 sites, in deeper water
and further from shore than existing offshore
wind developments. The current
focus is on foundations, cables, wake effects,
electrical arrangement, and next generation
marine access transportation and logistics
technology.
Today’s offshore wind farms are typically
less than 25km from shore in relatively
benign sea conditions, shallow water, and
consist of up to 100 turbines. Maintenance
personnel transfer is possible from boats,
about 90% of the time, when significant
wave heights are below 1.5m. The new
‘round three’ and ‘Scottish Territorial’ offshore
projects may be as far as 300km from
shore in harsher sea conditions, and may
incorporate as many as 2,500 next generation
high capacity turbines. At these sites,
Key figures:
By 2030, within the operations and maintenance phase alone:
The UK and Europe alone will require between 60 and 150 next generation wind farm service vessels
Many will be fitted with the latest “compensated” personnel transfer systems
Over which up to 1 million transfers per year to and from wind turbine foundations will occur
These shall be supported by 30–40 multi-purpose offshore “mother vessels” providing a high capability marine base and place of safety out
in the wind farm
Not to mention the tens of thousands of crew, technicians and support personnel who will operate and maintain this logistics infrastructure.
no 01 2012 – 59

+ Green innovation
© Momac
I The Carbon Trust selected 13 new concepts, including a giant robotic arm developed by Germany’s Momac. The arm uses sensors to assess the motion of the vessel and
automatically keep the transfer platform stable.
today’s access means would only allow
transfers about 200 days a year. As part of
this OWA programme, the Carbon Trust
launched its Marine Access competition last
year with the aim of finding technologies
that can be developed and commercialised,
to make transfers possible for over 300 days
a year.
I ExtremeOcean Innovation’s TranSPAR craft was also selected as one of the winners
in the Carbon Trust competition.
© Transpar/Extreme Ocean
BACKED BY OFFSHORE WIND DEVELOPERS
In partnership with wind developers DONG
Energy, E.ON, Mainstream, ScottishPower
Renewables, RWE, SSE, Statkraft, and
Statoil, the competition was divided into
three categories: vessels, launch and recovery,
and transfer systems. It attracted 450
submissions from companies and innovators
across the world, from which the
Carbon Trust selected 13 new concepts
that could improve access and help cut
60 – no 01 2012

© Nauti-Craft
I Australia’s Nauti-Craft was shortlisted for a new ‘pond skimmer’ concept that uses advanced suspension technology to keep the hull stable, while speeding up transfer times.
the cost of energy. These include a giant
robotic arm developed by Germany’s
Momac, which uses sensors to assess
the motion of the vessel and automatically
keep the transfer platform stable.
Australia’s Nauti-Craft was shortlisted for
a new ‘pond skimmer’ concept that uses
advanced suspension technology to keep
the hull stable, while speeding up transfer
times.
The Carbon Trust is now working with
the winning entries to develop the concepts,
accelerating them towards demonstration,
and then commercialisation, if
the concepts prove effective and practical.
GREEN GROWTH OPPORTUNITY
“We trawled the globe looking for revolutionary
new ideas that can transfer engineers
safely in the huge swells around the
UK’s coasts. People have been building
boats for thousands of years, but we’ve seen
some truly radical departures from what
you would think a boat should look like.
These designs could significantly improve
the economics of offshore wind and keep
our engineers safe far out to sea. Our analysis
shows offshore wind is a green growth
opportunity which could create up to
230,000 jobs in the UK by 2050,” says Sykes.
The Carbon Trust believes that together,
the global market opportunity for these
wind turbine access solutions could be
worth more than GBP2bn by 2020, of
which the UK could capture up to 50%.
Commenting on the OWA programme
and competition, DNV’s Project Sponsor,
Donald Brown says “DNV is the technical
delivery consultant for the Access competition.
We have had an exciting mixture of
unconstrained out-of-the-box thinking,
combined with experience transfer from
other industries and evolution of current
technology. Providing these concepts can
be successfully developed and commercialised,
and accepted by the industry stakeholders,
the challenge will be overcome.”
“The initial set up was taken with a longterm
view to find the right approach, but
we were pleasantly surprised by the outcome.
This demonstrates the real value in
collaborating. Working together to find
the solutions,” says Sykes and concludes,
“Of course there will be failures along the
way and objections still need to be heard,
but we need to hold course and just get on
with it. After all, we need innovation that
delivers, stretching both minds and horizons.
GBP30 million spent for a few billion
saved is a no-brainer.”
no 01 2012 – 61

+ Material technology
DRAWING THE
CORROSION-RISK PICTURE
ASSET MANAGERS WANT TO REDUCE CORROSION RISKS. TO ENABLE THEM TO MAKE THEIR DECISIONS
IN A FAMILIAR CONTEXT, CORROSION PROFESSIONALS HAVE STARTED APPLYING RISK PRINCIPLES.
OPTIMISED CORROSION MANAGEMENT IS THE GOAL.
TEXT: EVA HALVORSEN PHOTOS: DAMIR CVETOJEVIC
There is zero tolerance for failures
that affect people or the environment,
and asset managers’ expectations
regarding corrosion-risk reduction
are now higher than ever before. This is
true across most industry segments where
the demand for corrosion management
has grown, such as the oil and gas, chemical
process, nuclear, bridge, and aircraft
industries. At the same time, the infrastructure
in countries that experienced their
peak industrial growth more than 30 years
ago is becoming increasingly difficult to
manage. Although most assets can be operated
beyond their original design life, the
information related to their construction,
maintenance and historical damage may
be of low quality or have gaps.
“These factors complicate risk assessment,
causing apparently unlikely events to
occur without warning,” explains corrosion
expert Oliver Moghissi. He is the director
of the DNV Materials and Corrosion
Technology Center located in Columbus,
Ohio, USA. He is also the President of
NACE International, the world’s leading
corrosion society, with more than 27,000
members from over 110 countries. NACE’s
mission is to ‘Protect People, Assets, and
the Environment from the Effects of
Corrosion’.
I “By monetising the benefit in terms of reduced risk, the corrosion professional allows the asset manager to make
decisions in a familiar context, and he or she can prioritise expenses and risks across the entire asset,” says Oliver
Moghissi, the director of the DNV Materials and Corrosion Technology Center located in Columbus, Ohio, USA.
He is also the President of NACE International, the world’s leading corrosion society. Here he is making a speech
at the CORCON Corrosion Conference in Mumbai, India, earlier this year.
“Corrosion professionals are increasingly
using risk principles to optimise corrosion
management,” says Dr Moghissi. “First of
all, this is a result of the asset managers’
higher expectations, but it is also a consequence
of the asset managers’ desire to
better understand the recommendations
of corrosion professionals. Another aspect
is the need to optimise corrosion-related
maintenance expenses.”
COMMUNICATION GAP
To be able to understand the total risk picture
better, asset managers need to understand
the effects of corrosion. According
to Dr Moghissi, there is today a communication
gap between asset managers and
corrosion professionals.
“Corrosion professionals tend to have
the technical knowledge to identify and
mitigate specific threats, but lack the abil-
62 – no 01 2012

“Corrosion professionals are increasingly using risk principles
to optimise corrosion management.”
ity to assess the importance of all threats
and prioritise activities to mitigate them.
On the other hand, asset managers tend to
understand the risk-optimisation process,
but lack the ability to identify and mitigate
specific corrosion threats and assess the
probability of failure,” he elaborates.
The communication gap is being
addressed in two ways. The first is through
the development of corrosion management
plans, codes and standards. To meet
this need, NACE has developed a new corrosion
management standard practice for
pipelines that can be understood by those
both inside and outside the corrosion profession.
A similar plan for highway bridges
is under way.
The second way is to ask corrosion
professionals to put their technology into
a decision-making context, such as a riskbased
approach.
“After all, asset managers are not inclined
to engage in the study of corrosion science,”
says Dr Moghissi.
DIFFICULT ROLE
The corrosion professional needs the ability
to better quantify the return-on-investment
for corrosion-mitigation expenses, for
instance in terms of maintenance optimisation.
The existing role of the corrosion
professional is difficult because his/her
technical recommendations result in an
expense with a difficult to measure
benefit. As an example of this, Dr Moghissi
mentions the fact that nothing happens
when the structure does not degrade.
“By monetising the benefit in terms of
reduced risk, the corrosion professional
allows the asset manager to make decisions
in a familiar context, and he or she can
prioritise expenses and risks across the
entire asset,” says Dr Moghissi.
no 01 2012 – 63

+ Last word
PIPELINE RESEARCH:
WHERE NEXT?
IT COULD HAVE SOUNDED LIKE ONE OF THOSE OLD JOKES: “AN ENGLISHMAN, AN IRISHMAN, AND
A SCOTSMAN MET UP TOGETHER AND…”. BUT IN THIS CASE, IT WAS A PRESIDENT OF NACE
INTERNATIONAL, A PRESIDENT OF PRCI, A CO-CHAIRMAN OF EPRG, AND A NUMBER OF HIGH-LEVEL
SUBSEA PIPELINE INDUSTRY REPRESENTATIVES, AND IT WASN’T A JOKE.
The occasion was the recent meeting of the DNV Pipeline committee, under the chairmanship of Colin
McKinnon of Wood Group/JP Kenny; it’s rare to see such an influential pipeline-industry group in one
room, and I was privileged to have been invited to listen-in to the group’s conversations.
JOHN TIRATSOO,
Pipelines International
The DNV Pipeline committee’s general aim is to discuss current needs in the subsea pipeline industry and
help monitor the development of new codes and standards to reduce future risk. With this in mind, and
under DNV’s aegis, a number of joint-industry projects have been established, and the committee reviews
and updates progress on these as part of its work. From time to time the committee invites guests to discuss
specific subjects: at this recent meeting, a number of guests had been invited to review the subject of
‘Pipeline research and development: the needs of today and tomorrow’.
DNV’s first pipeline code was issued in 1976, since when the company has created a number of internationally
recognised standards and recommended practices for the pipeline industry. Based on its project experience,
research, and joint-industry development work, the organisation also issues a number of pipeline
codes which comprise service specifications, standards, and recommended practices, and which are highly
regarded within the international pipeline community. These are complemented by upwards of 13 recommended
practices which give detailed advice on how to analyse specific technical aspects according to
DNV’s researched criteria.
In its focus on R&D needs, the committee was asked to keep ‘big safety’ in mind: rather than relying on
standards that apply to ‘trips and slips’, industry nowadays needs to improve its safety leadership, and add a
consideration of safety to the design review process. It was acknowledged that feedback from operations to
designers could only be beneficial. As was pointed out, optimum design is not robust design, particularly as
the intended use for a subsea pipeline may change over time: for example, moving to multi-phase flow from
single-phase, changing third-party threats, or varying seabed currents.
Improving communication skills was seen as one of the most important current targets, combined with the
need to improve corrosion management guidance for those outside the profession, and helping stakeholders
and decision makers understand the significance of corrosion technology.
Probably one of the most important outcomes was an acknowledgement that research kept confidential for
too long is essentially wasted research. Although research has to be funded, and the current model in many
countries was that industry has voluntarily to provide this funding, it is clear that the results must be made
public as soon as reasonable. A two-year moratorium, to allow the funding companies to have some of the
technological rewards from their investments, was seen as acceptable; longer delays were not. A good example
DNV’s initiatives in making the details of the JIPs with which it is involved openly available through its
website. The spirit of this meeting was wholeheartedly in support.
64 – no 01 2012

© DNV/Anders Øvreberg

12,000/ 01-2012 1103-001
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