The complexity with Offshore contracts
Offshore contracts are notoriously hard to perfect. Workability depends on various factors that cannot be controlled, the weather being one of them. When looking at what should and shouldn’t determine workability, parameters such as weather and wave height are used, which leaves operators vulnerable to exceeding time and cost due to unpredictable circumstances. Vessel owners ultimately want to know the circumstances in which their staff and equipment can function in a safe and efficient manner. That might mean one thing for one operation and something completely different for another under the same conditions.
Wind farm operators want to act as quickly as possible if a turbine breaks down and when regular maintenance is required. A farm with 80 turbines basically requires an ongoing maintenance campaign. In order to mitigate risks, the operators require their subcontractor to have a certain uptime, so they can ensure that they can access the turbines for a maximum amount of time e.g. 95%. In the North Sea, this often translates to a 3m significant wave height: i.e. 95% of the time the wave height is lower than that 3m. This is a simple way of reasoning and works well in contracts. However, it results in a number of unwanted effects:
- It’s an inaccurate parameter: One sea state with 3m height is not the same as another. Ships are not only sensitive to the height of the waves, but more so to where they come from and what the wave period is. This is not reflected well and hence in some cases the ships can operate safely whilst in other cases this is not possible.
- Legal disputes: This leads to a lot of discussion and legal disputes: who pays for the weather down time? A walk to work vessel costs 30k per day (approximately). Who is paying for this when one party says they should have worked because the wave height was lower than 3m, but the other said it was unsafe?
- Traceability: It’s hard to get good readings of the waves. Usually wave buoys are used, but they often have issues and fail to identify wave direction and other relevant parameters.
- Accountability: An increasing desire of corporates to be able to asses, compare and review the performance of their assets, crew and other stakeholders. The direct link between better defined limits, forecasted data and monitored data allows for analyses of the processes involved. Ultimately with the objective to learn and to improve the overall performance.
There must therefore be a better way to use the same information to create parameters that ensure safety and workability. If the operation is safe at a 3m wave height for 95% of the time, it would make more sense to determine workability by the motion of the vessel, instead of the wave height. It’s also much easier to measure vessel motions and determine, based on a jointly decided limit, if it’s feasible to operate. By doing it this way there is an increased up-time guarantee which means increased productivity and profitability. Improved contracting leads to stronger relationships and working partnerships. There is still some way to go with acceptance and assimilation of this new way of working, but the results are already impressive.
To find out more about the new methodology and what the options could be for your operation, don’t hesitate to get in touch with us.