Introduction to floating production storage and offloading

At its core, an FPSO facilitates the processing and storage of oil and gas at sea.  

It stands for floating production storage and offloading (FPSO). These vessels are used extensively by the offshore industry and have become one of the primary methods of oil and gas processing and storage. As its name suggests, an FPSO is a floating vessel that acts as a mobile offshore production and storage facility. They are typically employed and leased by oil and gas companies.  

The vessels themselves are equipped with processing equipment for the separation, storage and offloading of oil and gas that comes from sub-sea oil wells or platforms. When oil and gas is processed, it is safely stored in the FPSO until it can be offloaded onto a tanker or a pipeline for transportation ashore.  

For a deeper dive into FPSO's check out our guide

The FPSO Sector

The slump in oil prices that plagued the oil and gas sector in recent years did not spare the floating production, storage and offloading (FPSO) sector. But now, with oil prices rising and after almost a two year period of absent orders, the market is finally seeing an uptick.

The good news we are hearing is that the oil price stability ($75-$80) has resulted in an uptake of FPSO projects, giving oil companies the confidence to move forward. But the real push is coming from the fast depletion of oil reserves and degradation of field potential due to the stagnation of projects over the last 18 months during the downturn. As such, oil companies have to move forward to develop new fields.

Out of the nine floater awards anticipated this year, five have already been confirmed:

• Fluor for Shell’s Penguins project in the UK
• Offshore Oil Engineering Company (COOEC) for CNOOC’s Liuhua 16-2, 20-2 and 21-2
  fields in China
• TechnipFMC for an integrated EPCI contract from Energean on its Karish FPSO project
  off Israel, with Sembcorp subcontracted to design and build the hull and living quarters
• Yinson Holdings for First E&P’s Anyala and Madu discoveries off Nigeria
• Modec with an EPCI award from Petrobras for the Mero-1 FPSO in Brazil
  Source: Rystad Energy

Digitisation of FPSO

Like many other sectors, oil and gas is experiencing the steady digitization of operational procedures to promote efficiency and save costs. However, unlike other industries, oil and gas have been slow to adopt increased connectivity and the technologies associated with the Internet of Things (IoT).

The rapid conversion of operational technology (OT) and information technology (IT) has resulted in increased efficiency through big data, analytics, sensors, the ability to automate highly sensitive tasks and more.

RELATED: The Great Data Transformation

Going forward, FPSOs will likely have to incorporate more digitisation. From fleet data to analytics tools and predictive analytics, these technologies can be used to determine success rates, estimations of topside components and more.

Monitoring technologies are far better now than they were many decades ago when most FPSOs were commissioned. The digitization of FSPO has helped prolong the shelf life of many older vessels. Companies now have a better grasp measuring the fatigue of vessels and how each project impacts a vessels service life. Organisation now has data on hulls, mooring systems, processing equipment and everything in between.

Not only does this lead to intact components of a vessel being recycled, but the data produced also leads to more efficient designs.

RELATED: How Operators are Making Digital Operational

The sector is already towards the front of this transformation, using digital technologies overall. This is unlikely to result in reduced manning, however, the advantages in reduced maintenance costs as we move more and more to different technologies

David Hartell, Senior Development Manager of Premier Oil said, "The FPSO industry has an opportunity to use digital transformation technologies from other industries including shipping and onshore process plants. We can be “fast followers” with the benefits of this experience able to be applied quicker and more cost-effectively."

The FPSO industry should be “informed customers” of these technologies and apply priority solutions by first focussing on the desired values to be captured (i.e. safer operations, reduced maintenance, etc.), then the underlying decisions needing to be made, what insights were necessary to make these decisions, what data analytics were necessary to obtain these insights, and finally on what data needs to be analysed and how it can be aggregated and processed, Hartell said. 

Increase efficiency by using next-generation technology

In addition to the perennial concern of putting fewer people at risk when carrying out inspections, avoiding downtime gains heightened importance. The employment of drone technologies to reduce costs is certainly something that oil and gas companies are adopting with increasing frequency in the current environment and this is set to accelerate.

FOR MORE GUIDES CHECK OUT OUR GUIDE TO FLNG

Next generation inspection processes are changing the game with regards to cost and exposure of personnel to hazards, bringing opex down but also bringing into play issues like cybersecurity and the difficulty of data capture and translation of data into universally usable formats.

Value the human factor

The bottom line still remains that we need competent people and processes in addition to technology, which became a more difficult prospect in the wake of the demographic carnage established under the Great Crew Change. UAVs and ROVs are huge enablers for cost-cutting, yet there will be no getting away from the necessity and reliability of on-site human supervision.

Be open to a new age of financing

The beginning of the oil price depression in 2014 saw a new type of downturn, unlike previous nosedives in the 1970s and 1980s. This dip has forced longterm strategists to rethink. Could we be seeing the advent of a new generation of in-housing and a move away from traditional project financing?

RELATED: FPSO: In recovery mode

Or will the sector push into a generation of oil price-induced risk sharing? A step-change in the financing of FPSO projects may be here already. The sooner O&G adapts to this prospect, the better.

What other technologies are there?

Digital twins are a technology where dynamic virtual models can be used to
better understand how to safely operate and control complicated process equipment and systems including training operators.

Hartell Said, one important technology is augmented reality – it is a way to better equip a multi-skilled crew onboard an FPSO with more accessible technical knowledge about how to diagnose and maintain equipment and process systems. Another important technology is video monitoring (visual and thermal) and analytics of process equipment and areas to supplement the physical rounds of operational personnel. 

Just recently, Cygnus, one of the largest platforms in the North Sea, broke ground by being Googles first ever Street View tour of an offshore platform. The tour enables users a glimpse into the life of an offshore worker, as the impressive virtual tour allows you to visit the helipad wellhead, control room, accommodation and fitness, leisure and restaurant spaces. 

Check out the Oil & Gas IQ News Stream for info on the FPSO World Congress 2018