Lightweight, modular subsea components designed to reduce ownership costs by 50%

Lower costs, improved productivity and increased yield. These have always been the goals of the global energy industry. However, after the exceptionally difficult business conditions of the past five years and current market volatility, this mantra has become more meaningful than ever. It is now the driver of significant advances in technology, design methodologies and integrated implementation processes.

Investment emphasis also has moved away from high-profile stand-alone developments, which have potential for big rewards but come with higher risk of cost overruns and delayed returns. Instead, the focus is now on more tactical exploitation of existing discoveries, converting contingent resources to reserves. Priorities are now shorter-cycle, adding cost-effective capacity to existing pumping processes, for example, or maximizing extraction at a lower lifting cost.

The significance of small differences. In these circumstances, increasing margins is not just a question of increasing capacity. Instead, it’s about creating significant impact from small differences across the entire value chain and developing the capability of identifying where those small changes can be made most effectively.

At Baker Hughes, we believe there are significant volumes of contingent resources that can be made economic by adopting a new approach to product development and supply (Rystad data indicate that this volume could be as much as 16 Bboe). Our research suggests that the economic development point for subsea projects can be reduced by an average 30%.

Nonetheless, these small changes do require a big shift in mindset. It requires meaningful partnerships between suppliers and operators at a much earlier stage in the design and development process. Digital tools, planning and risk management are central to that process. To reach the economic target, it is imperative to design flexibility and modularity into subsea technology.

The potential of tie-back capabilities. Developments in tie-back technology are just one illustration of the value that can be created. The industry has come a long way since tie-back connections of 2 to 3 km (1.2 to 1.8 mi) were considered extraordinary. Engineers have continued to push the boundaries of technical capability to tie back fields. From fiber optic cabling to vessel size, all have expanded aggressively—as have the number of potential reservoirs that could be exploited in a financially viable way.

Fig. 1. Operators can extend the life of mature fields by utilizing long tie-back capabilities to increase operational efficiencies and keep pipelines full of product.

Today, we are looking at tie-back distances of more than 100 km (62 mi). Fields in the Gulf of Mexico that have been producing since the 1970s, and which reached what was considered to be end-of-life, can now realistically increase their capacity by using tie-back technology to keep pipelines running, Fig. 1.

Lowering the total cost of ownership. By having advanced technology that improves tie-back capabilities, another shift is under way, as firms like Baker Hughes endeavor to extract redundant costs through improved designs. As with the components of our Aptara TOTEX-lite subsea system, we have been re-thinking our tie-back technologies to make them modular, structured, compact and more responsive to changing conditions across the life of field, Fig. 2.

That means looking at materials in a new way, for example, by bringing in composite materials from the aerospace industry to create pipes that are vastly lighter than traditional products. This can achieve significant cost-savings: there may be initial, front-loaded expenditure, but eventually fewer materials mean fewer costs and less impact on the environment.

Fig. 2. The subsea system is easier to install and gives operators more flexibility when making late-life infrastructure decisions.

Although making things less-expensive and lighter-weight is essential, re-thinking design goes beyond that. The fundamental design can present further opportunities to eliminate costs that have traditionally been overlooked. In this case, we have re-designed the flow path of our pipes, which means they require fewer valves and smaller valve blocks. Fewer components equates to lower costs and less risk.

Manufacturing and digital. With new designs and material specifications in place, manufacturing the product becomes easier and quicker—and the cost-savings start to ripple out through the value chain. Logistics and transportation consume less budget, as smaller and lighter pipe can be transported by smaller and lighter vessels. Deployment and installation are quicker and easier, which then makes it possible to identify and address any quality issues that arise much earlier in the process.

Of course, digital developments also come into play. The advantages of Industrial IoT, digitalization and automation are already understood. It’s certainly true that smart sensors on a subsea tree can deliver data that transform our understanding of platform operations, maintenance and integrity. Robotics in fabrication plants have automated several processes for a long time, but with machine-learning capabilities they can improve their own performance over time. Each iteration of manufacturing becomes an opportunity to improve the process for suppliers and operators, and embeds quality consistency, productivity and on-time delivery into the process. Again, there are cost and productivity benefits to be gained.

Other seemingly straightforward changes can cause profound shifts in attitude and approach. If, as Baker Hughes believes, early and consistent engagement with operators is a critical part of improving equipment design and manufacturing, then that engagement needs to be enabled. Digital publishing technologies give operators real-time information on where their specific product is in the manufacturing stage. It enables them to view their equipment as it goes through production, view testing results, and assess ongoing plans for bringing it onsite and installing it.

Fifty-fifty thinking. Our goal is to ensure that our tie-back initiatives are 50% lighter than traditional alternatives, with shorter lead times and sufficiently flexible technologies, so that they can evolve to suit the changing needs of a field over its lifetime. The ultimate goal is another 50%, by which we plan to cut the total cost of ownership associated with our products.

Of course, current developments raise questions about where to go next. With tie-back technology becoming more robust and critically more cost effective, does it really need an existing platform to tie-back to? That’s just one of the questions posed by the new technology and the capabilities it introduces. Could it be possible to use a vehicle to inspect, manipulate and control the field, and then use tie-backs to transmit power locally? Can we use data produced by smart subsea sensors to challenge field design still further and produce something that is genuinely transformative?

Early partnering with operators will improve results. Those questions are best answered in close collaboration with operators, rather than being considered in theoretical isolation by suppliers and designers. It’s another indication that the relationship between suppliers and operators is moving away from the straightforwardly transactional—and that this can only result in improved outcomes for all parties.

The fundamental truth is that, so far, the energy industry has not needed to innovate at the rate seen in other industrial sectors. But the productivity curve is changing. Staying ahead of it is going to require a combination of big changes and eureka-type moments, incremental shifts and 0.1% adjustments at the edges. Simply accepting existing working practices and cost centers just because they’ve always been there is less sustainable than ever. And as we have seen recently, price stability has not returned and we at Baker Hughes are focused on delivering economic projects in uncertain markets.

This is the opportunity to move forward, establish more sustainable ways of doing business, bringing in the technologies and changes to create sleeker businesses—Baker Hughes is well prepared to manage these volatile times and deliver exceptional value to our customers.