'It's not just technology that makes a difference to enterprises, but the business models being used'

Mr. Sanjay Joshi,
Country Manager and Managing Director, Aker Solutions India
'The entire oil & gas industry is now focused on cost effective project execution strategies in order to make the industry sustainable even at lower oil prices. It is up to us to ensure our people and processes can keep up with these requirements', says Mr. Sanjay Joshi, Country Manager and Managing Director, Aker Solutions India. In a candid interaction with Rakesh Roy, he articulates about the shifting focuses in project management strategies, customer expectations, technology developments and various other key concerns in the changing business environment of the oil & gas sector.

How has the project management strategy in oil & gas projects changed with the changing business environment?
Today, large oil and gas projects are becoming increasingly complex and technologically demanding. The prevailing tough market conditions require lean project budgets, with an emphasis on optimized and cost efficient solutions in design, execution, and operations. In this scenario, project management has to be dynamic and focused on delivering the best value through the best solutions. Sometimes this involves innovation and cuttingedge technologies, while in other cases it’s a matter of reworking existing solutions to do things faster, better and cheaper.

We have launched #thejourney, a global improvement program across Aker Solutions. #thejourney encompasses all our improvement efforts - and we see that it is delivering real, tangible results.

The goal is to increase cost efficiency across the business, and share these benefits with our clients. We are building a stronger culture of continuous improvement, as well as a competitive and sustainable organization.

Aker Solutions is also actively looking at partnering with various companies to provide complete, comprehensive, and holistic end-to-end solutions to our customers in order for them to derive the most value out of such partnerships.

What are the challenges faced by engineering service providers regarding the customers’ changing expectations? As a services provider to oil & its allied industries, how does your organization respond to these challenges?
The entire oil & gas industry is now focused on cost effective project execution strategies in order to make the industry sustainable even at lower oil prices. It is up to us to ensure our people and processes can keep up with these requirements. Operational excellence is at the core of Aker Solutions' strategy as we seek to forge a sustainable future for our industry and the world it serves.

We are systematically increasing efficiency by analyzing our deliveries and eliminating tasks that do not add value for the customer. To help us with this, as part of or global improvement program #thejourney, we are rolling out Lean methodology and tools across our operations globally. This method of working has already demonstrated significant reductions in lead-time and project man-hours, cost reductions, simplification of processes, and mor .

How has the oil and gas market changed as the industry has gone from the shallow reservoirs of the past to deepwater?

The global need for oil and gas grew by about 1 million b/d in 2015, averaging about 94 million b/d. This trend is expected to continue, with a projected consumption of about 96 million b/d in 2017. Developing deepwater reserves will be essential to ensure that supply meets demand.

Accessing reservoirs at greater depths requires complex technology, which can result in a very high E & P spend for operators. This kind of capital expenditure needs careful deliberation considering the drop in oil prices, which has led to deferral or cancellation of many deepwater projects.

In such a scenario, the development of new technologies that can access these reservoirs at viable capital investments becomes crucial. It is only with constant development and refinement of new solutions that the oil and gas industry can stay sustainable. This is where we have taken a step towards the future with our subsea technologies like the subsea compression system.

How has technology in the oil & gas industry evolved in the last few years & what are the future trends?
As an industry, we are at a turning point. We need to reassess the way we work, and invest in research and development to create innovative and costefficient solutions for our clients. At the same time we must also focus on standardization and effectively utilization of already existing technology.

One example of the first is the Aker Solutions subsea compression technology, which is opening up new opportunities in deeper waters, harsh environments and in areas far from shore. Subsea compression has a long list of merits: it provides a better business case by cutting costs and increasing production, it is safer, being remotely operated, and minimizes the environmental footprint. We delivered the world's first subsea compression system for the Åsgard field in Norway in 2015.

However, we believe that it's not just technology that makes a difference to enterprises, but the business models being used. Aker Solutions believes that clients must have access to the best talent across all our offices around the world. For instance, we have teams in Oslo, London, and Mumbai, which ensures faster and more cost-efficient solutions on the Johan Sverdrup mega-project for Statoil.

How do you see the Indian scenario in offshore and deepwater oil & gas developments?
India needs to significantly reduce its dependence on energy imports. This puts a major focus on developing our hydrocarbon assets wherever discoveries have been made. The development of deepwater fields on the east coast of India offers a great opportunity for the country in the current market scenario. The services and hardware supplies are available at a competitive pricing to help oil companies make investment decisions.

It is important to build local expertise in these areas to support the development and reduce dependence on external expertise. The government's Make in India campaign is addressing some of these issues. However, to ensure that we continue to attract the best technologies and players, the policies for this sector should also be consistent with internationally accepted norms.