PartnerShip: After the crisis, the Oil & Gas market has recovered for the major Oil & Gas groups. What were the signs of this?

Christian Brugård: Everything is linked to the price per barrel, which fell in late 2014. When it reached 30 dollars in 2016, the major Oil & Gas companies reached the low point of the market. Since then, the large companies are doing better, but they’re still pushing aggressively for cost reductions and reduced rates. Today we see a strong recovery, but how much are the major groups ready to invest in projects? In 2017, 11 large projects Float Production Unit projects were launched globally. This was a turning point for the market. In 2018, between 12 and 15 projects are expected, and even if this is extremely difficult to predict, we expect between 16 and 19 major projects in 2020. In addition to this several other smaller and larger non-floating production projects have been sanctioned, and will be sanctioned in the same period according to our analysis. 

PS: What about service providers like BOURBON?

C. B.: For those companies, the low point was reached last year; since then, the market has been making progress, particularly for the drilling sector. 2018 is a pivotal year for service providers who are beginning to be active again. Today, 60% of the service vessel fleet is operational, i.e.. 5% more than at the beginning of the year, which is a rather good sign. Furthermore, some new strategies have come about, but without major innovations: costs have been systematically brought downward, but with more effective, more reliable, more automated solutions. This is excellent for principals! Likewise, we observe that subcontractors are teaming up in order to offer integrated solutions. Recently, we saw companies making joint offers in developing Oil & Gas fields. In every way, innovation is a greater challenge for the players on this market than ever.

PS: But there are still many stacked vessels...

C. B.: Currently, the offshore support vessel activity has resumed: between January and July 2018, utilization for the active fleet has bottomed and started to climb again. That's a good indicator of the market recovery. However, out of the 4,600 OSV in the worldwide fleet 1,200 are still stacked, including 600 that are over 15 years old: with the recovery, it will be necessary to reinvest in those vessels, but will it really be worthwhile for the oldest of them? That will depend on the vessel type, how they were maintained, but 15 years is generally a limit not to be exceeded. BOURBON, like the other service providers, will have to face this challenge, but with limited cash on hand. That's a real challenge.

PS: During this time of crisis, digitization is at the heart of technical evolutions. How do you analyze this strategic change?

C. B.: Digitization is a major issue. It is based on 3 main focuses: sharing, collecting, and analyzing information and connecting equipment and people. It is already in place for the most part, but it is starting to develop and be more generalized. In Oil & Gas, improving the quality of analyses will make it possible to optimize platform operations and vessels, reduce the financial and operational risks with a more analytical approach and possibly to reduce OPEX. BOURBON has also been one of the pioneers in this area. The first step of digitization will probably result in a better risk analysis of offshore investments and operations: for example, a better understanding of exploration and production costs. More and more staff will be transferred to shore, fewer on-board work hours will be necessary, which will reduce OPEX. However, new CAPEX investments will be required, either to outfit new vessels or conducting retrofitting of existing equipment. 

PS: One last word on autonomous vessels?

C. B.: They are obviously coming to the market, that seems unavoidable to me. Within five or ten years, there will be the first autonomous conventional vessels. It will probably be longer in Oil & Gas due to more complex operational patters. But I could be wrong, it can of course move much quicker in Oil & Gas as well. In my opinion, the first step consists of connecting vessels in order to reduce crew size, which is happening with BOURBON. As for the drilling industry, a portion of monitoring already takes place on shore. 
 

 "For several months now, we have decided to operate a strategic shift inspired by the logic of airline companies: in fact, these two activities have very similar business models," explains François Leslé, CEO of Bourbon Mobility. Thus, the company aims for the same standards in terms of services, comfort and safety, by capitalizing firstly of all on its key strengths: operational excellence and technical reliability of its vessels. Because one can only succeed by building on solid foundations. 

All employees, at all levels of the company, are leading this new approach: "it is one of the key elements of this new direction" continues François Leslé. "There must be a real team spirit within Bourbon Mobility! Everyone must work together to achieve the same goal, in collaborative mode. All initiatives must be valued and we encourage feedback of information from the field to exploit positive potential ideas”.

The service offer has been redefined according to 3 major lines to make it clearer:

• a "Crewliner" service for long-distance transport, 
• an "Inter-field" service for the transport of personnel between oil fields, 
• and a made-to-measure "Specific Support" service. 

With an average base/platform journey of four to five hours and even up to 12 hours, the comfort of our passengers remains a priority. "Our vessels, which are serviced in our Surfers Repair Centers, have a record technical availability rate, but we must now change paradigms and search for a 100% service rate," adds François Leslé. "This strategy represents a fundamental change: the vessel becomes a means and the passenger is placed at the center of this logic."
 

Initiatives are also being taken to make the passenger experience more pleasant. A WiFi network will thus be available on all vessels, with a supply of films and media modelled on the standards of airlines and which passengers will be able to consult on their personal mobile devices. This service is currently being tested in Nigeria and Gabon and will, if results are conclusive, be deployed on vessels before the end of the year for clients who request it. Similarly, a snack service will be available from mid-2019 to respond to a real demand expressed by clients.

Going beyond the vessels themselves, BOURBON is planning to diversify its services. Reflection is in progress as to an UBER-type solution based on digitization for inter-field services, which would enable us to know the number of seats available in real time, book according to needs, and allow the client to pay according to the use of the vessels. This service should be finalized within two years. "The group is also preparing door-to-door offers for personnel in order to become what we could call an offshore travel agency, by taking charge of the persons concerned from their homes to the platform," says François Leslé.

Another symbol of the transformation of Bourbon Mobility is the fact that the company is working on an business model based on a rate per seat to encourage clients to optimize the occupancy rate and to pool means in order to continue to reduce their operating costs. In short, BOURBON proposes a real transformation of existing models.

The embarkation/disembarkation solution called "Boat Landing" is one of BOURBON's great achievements in the field of safety. With what results? 

BOURBON invented Boat Landing thirty years ago. No deaths have ever occurred with this service: it is still the most reliable system ever devised for the transfer of passengers on the open sea. Transfer between the vessel and the platform is extremely dangerous. There is no alternative solution currently available on the market that can compete with Boat Landing in terms of safety and duration. We can disembark 50 people in 10 minutes! 

People who discover this service may feel a certain amount of stress. How do you help them overcome it?

We are currently developing a 3D glasses project with a Major. The aim is to prepare newcomers for disembarking with the Boat Landing procedure. Once they have gone through the procedure virtually, they will better manage their stress and know what to expect. In addition, we have equipped all personnel who have never disembarked this way with green armbands so that the seamen can recognize them and provide specific assistance. 

Do you think you can still improve your equipment and reduce the time required for transfer?

Yes. The duration of transfer at sea is not a mere detail. New equipment is being studied to better respond to local constraints and to expand our zone of coverage. Even though Boat Landing is perfectly well adapted to West Africa, it is perhaps less so under the conditions that we encounter elsewhere, for example, where the needs related to the sea and the weather are different. We are therefore considering other technical solutions, such as the use of motion compensated gangways, to ensure an optimum quality of service with total safety.

India, the world’s fifth economic power, driven by a booming economy, is also experiencing unparalleled expansion of its oil and gas activity, in particular in the marine and subsea offshore sector. “BOURBON initially secured a position on the spot market” explains Jean-Charles Audouin, Area Commercial Manager. “This was substantiated, in a rather short space of time, through 2 contracts with Subsea 7, followed by McDermott, for the Indian national company ONGC”.
On the agenda, a repair mission on the S2AB field, then construction support work on the S1 Vashista field, with the same vessel, Bourbon Evolution 807, equipped with HD ROVs commissioned by Bourbon Offshore DNT.

BOURBON then pursued its development on the Indian market for Reliance Industries, by concluding a long-term inspection-maintenance contract for Bourbon Hélène on the KGD6 field, end 2017, followed by a second contract for the Southern Ocean for construction support on the KGD6-Rseries field. 

Bourbon Hélène is carrying out a production, inspection and cleaning support mission for subsea facilities. This namely includes conducting visual inspections with the ROVs, implementing corrosion inspection measures and cleaning concretions deposited on oil structures. As regards the Southern Ocean, it will undertake survey and support work for the construction of a KGD6-Rseries field subsea production system.

“This new milestone is important as it illustrates that we’ve earned the trust of our customers in this region through our experience and our service quality, and we’ve adapted to local regulations (local content, regulatory requirements and specific tax regimes)” states Jean-Charles Audouin. “We’ve been working with the Indian crews for a long time now, and that’s a great advantage. These sailors are highly proficient, experienced and work readily with BOURBON standards. Moreover, we can propose a fleet of modern SPS-qualified vessels, a real imperative on the Indian offshore market. What could be seen as a market entry obstacle is actually, right now, for us, a differentiating factor!” 
 

The group also benefits from its international footprint. With part of its fleet rolled out in Singapore and another in the Persian Gulf, BOURBON can serve India from the West as well as from the East and has, as such, a geographical asset for the Indian market, which is seasonal and monsoon-based.