Annual report 2008 - Aker Solutions

Our business
Products &Technologies
“Our combined capacity, competence and well
proven technology ensures continued growth and
value creation for our stakeholders”
Developments in 2008
Throughout 2008, our positions in the
drilling and topside equipment-related
industries have been strengthened and our
significant order backlog now stretches far
into 2012.
2008 proved to be avery successful
year with records established for both
revenues (NOK 14 216 million) and EBITDA
(NOK 1 448 million, up from NOK 959
million last year). Key developments in 2008
included an excellent order intake with the
award of two new drilling equipment
contracts from the Jurong shipyard in
Singapore with atotal value of USD 419
million. In addition, acontract was signed
with Daewoo in Korea for the delivery of
drilling equipment for two rigs for the end
user Odebrecht.
At the beginning of 2008, Aker Solutions
acquired a majority shareholding in the
Norwegian company First Interactive AS.
Using Aker Solutions’ First Interactive
technology, we are now developing a
service-based drilling optimisation solution
with full real-time 3D coverage for the
entire drilling operation.
In 2007, Aker Solutions acquired 50
percent of the shares in German company
Wirth GmbH. During 2008, there has been
an ongoing harmonisation process
between Wirth and Aker Solutions’ drilling
equipment unit. This process will continue,
further optimising the excellent fit of
complementary technologies between the
units. In January 2009, Aker Solutions
entered into an agreement to acquire the
remaining 50 percent share ofWirth.
Goals for 2009
We will continue to focus on two target
markets for the development of our business:
deepwater drilling including topside
drilling equipment and solutions, drilling
risers and mooring systems; and floating
production units (mooring and offloading
equipment and upstream processing technologies).
In addition we will increase our
focus on upgrades of drilling packages in
the North Sea as well as global sales of
drilling equipment with attractive lifecycle
potential. We will continue to develop our
deepwater drilling and floating production
offering organically and through carefully
evaluated acquisitions. With a growing
installed base of equipment and technologies,
our aim is to increase service
and lifecycle revenues. Our business
portfolio will also be strengthened by our
customers’ increased demand for simulatorbased
and conventional training and
condition-based monitoring.
Moving forward
Our business has grown rapidly over the
last few years. Although the short-term
market outlook is uncertain, we believe the
fundamentals remain strong for mediumand
long term growth. Due to the strong
order situation our expected activity level
in 2009 will be comparable to previous
years within most of our segments. Lifecycle
and service volumes are steadily
increasing as the installed base grows,
which we expect to continue. Moreover,
the demand for upgrades and overhauls is
likely to increase, both in the North Sea
and elsewhere. At year end our order backlog
amounted to NOK 14 705 million, with
deliveries through 2012 –forming asolid
foundation for our future.
Strengthening products and topside
technologies offering
To be in the forefront of key development
trends in our markets, Aker Solutions
decided in 2008 to change the structure of
its Subsea and P&T business areas. These
changes would meet the developing needs
of our customers, provide for strengthened
growth and take full advantage of the synergies
in our deep water drilling business.
Bringing our drilling risers business into the
P&T business area further enhanced our
drilling solutions and topside technologies
offering.
Through the restructuring of the P&T
business area we gain astronger global
drilling and topside portfolio to better
position ourselves for future growth and
value creation. From this reorganisation we
have increased access to competence and
technologies and we have strengthened
Aker Solutions’ ability to mature projects
and pursue business opportunities.
Arctic opportunities
During 2008, the offloading of
crude oil from terminal to shuttle
tanker was successfully performed
at the Varandey field in the
Barents Sea. The offloading, from
the Fixed Offshore Ice-Resistant
Off-Loading Terminal (FOIROT)
with the purpose-built, ice
classed shuttle tanker, Vasily
Dinkov, was the first of its kind.
The FOIROT is owned by the
Russian oil company Lukoil,
which holds the operator license
for the Varandey field, while the
Vasily Dinkov is owned by
Sovcomflot.
Aker Solutions designed and delivered
the Pusnes offshore loading
system installed on the Varandey
FOIROT. The system allows for the
safe and efficient offshore transfer
of crude oil onto highly sophisticated
ice-classed shuttle tankers.
These specialised loading systems
are developed for arctic conditions
and the protection of the arctic
environment, which has the highest
environmental standards.
The Vasily Dinkov is equipped
with the Pusnes bow loading
system, as are all shuttle tankers
operating on the field. Aker
Solutions has received orders for
the bow loading systems, which
include additional safety features
for the protection of the arctic
environment, for atotal of 12 arctic
shuttle tankers.
The Varandey field has approximately
245 days each year with
temperatures as low as -48 ºC,
and an ice thickness of 1.25–1.8
metres. The equipment developed
for the FOIROT by Aker Solutions is
unique to this type of operation.
It includes an advanced control
system for regulating the physical
interface between the terminal and
tanker during loading.
Aker Solutions annual report 2008 33