West Atlas - Keppel Corporation

Knowing what it takes
Rigbuilding requires excellent project management
With new yards entering the
arena to build rigs amid the
offshore boom, Keppel
Offshore & Marine’s (Keppel
O&M) Chairman & CEO
Mr Choo Chiau Beng issued
a strong word of caution –
that many were
underestimating the
difficulty of building rigs.
He shared the complexities of
building rigs at the Pareto
Securities’s 14th Annual Oil
& Offshore Conference in
Oslo, Norway, in August
2007.
Mr Choo explained that rigs
were akin to specialised
factories.
To build them successfully,
one has to manage the
supply chain well as it
involves the sourcing and
integrating of several
complex components from
different vendors around the
world.
He added that many Chinese
yards underestimated the
risks in building rigs. The
Japanese yards were not in
the rigbuilding business
as they recognised that
managing the supply chain
was a huge challenge.
Not only does the design and
construction of rigs call for
strong engineering and
production experience, it also
demands yards to have a
robust procurement system,
so as to fulfill on-time
deliveries. Above all, yards
need to have strong project
management teams to
execute in a timely and costeffective
manner.
Keppel O&M’s Chairman & CEO Mr Choo Chiau Beng likens rigbuilding to the construction of specialised factories. To build them successfully,
he shared, one has to manage the supply chain from vendors around the world
Business 9
The two-day conference
from 29 to 30 August 2007
attracted a multitude of
offshore oil and gas
companies from all over the
world and was attended by
over 1,400 people. They
included Prosafe, Seadrill,
Pride International, Skeie
Drilling & Production,
Gulfmark Offshore, BP and
Scorpion Offshore, among
others.
On the outlook of the
offshore business, Mr Choo
said that market
fundamentals were strong
for the foreseeable future,
although the concern of a
spike in the already volatile
oil price continued to lurk. A
good level for the rigbuilding
business, would be a long
term and stable oil price of
US$45 per barrel.
Mr Choo’s remarks at the
conference, where the air
was filled with optimism,
came amidst the high
volume of jobs currently
being executed by Keppel’s
yards.
To date, a total of seven
jackup newbuildings has
been delivered by Keppel this
year, all either on or ahead
of schedule. keppelite
Keppelite I September 2007