Regulatory Management
[TN Petróleo, # 70, mar/apr 2010]
Regulatory Management
Through the regulatory support service in Brazil for international companies wishing to operate in the Oil & Gas industry, Forship, supported by strategic partnerships with industry experts, expands its portfolio of solutions
Customization
Scope of Forship regulatory services developed by highly qualified managers, engineers, and technicians:
· Issuance of regulatory directives, procedures, and technical reports;
· Translation and interpretation of the local laws and regulations;
· Review of regulatory and project documents;
· Answers to technical queries, as well as recommendations of preventive and corrective actions;
· Translation of specifications, reports, and drawings of the project;
· Physical inspections on the installations.
· Repetro inventory and as built inspections;
· Technical support to interface with the Brazilian authorities;
· Supply of specific manpower.
Technical and bureaucratic obstacles - especially those relating to regulatory issues - are one of the main problems that foreign companies of the oil & gas production, shipbuilding and petrochemical industries face both in installation and operation in Brazil.
These obstacles end up having a major impact on schedule and prices, affecting their competitiveness in the Brazilian oil market, which is booming due to acceleration of the activities in shipyards and offshore basins, thanks to new projects for oil & gas exploration and production. Mainly in Santos Basin, location of the great discoveries of pre-salt oil reserves, besides the other Brazilian basins, which have attracted investors and foreign companies to the country in recent years, and have created new businesses.
Many of these international players already know Forship Engenharia, a Brazilian company with strong presence in the Oil and Gas, and shipbuilding industry, with expertise recognized in the offshore commissioning area, operating anywhere in the world where its services are required, with operations in Americas, Europe, Africa, and Asia.
Participating, in recent years, in the main offshore commissioning projects for Petrobras and other oil companies, Forship ended up having to provide services related to several regulatory issues, while trying to offer a complete service and support to its clients. It all began as a complementary service and then turned into a new line of business.
Complementary Service
“The Regulatory Support area was born during the commissioning process of major projects carried out by Forship, in which we ended up getting involved in several regulatory issues.” says Antonio João Prates, Director of Engineering. “It was a consequence, a byproduct of our portfolio. But the growing demand for an integrated solution eventually led us to consolidate the regulatory support area as an expert consultancy with high-added value, consistent with the strategic goals of Forship.” he added.
Based on the knowledge of Brazilian market and its services portfolio for complex industrial projects, Forship, began offering regulatory support so that international companies could meet the requirements of Labor, Environment, Customs, Maritime and Petroleum authorities, among others.
To consolidate this new line of business, it searched for an experienced professional in this area. Nowadays, regulatory support services are coordinated by Cristiane da Costa Guimarães, Project Manager directly subordinate to the Director of Engineering, with support of Forship International and strategic partners - specialized consulting in the regulation and taxation area.
“There is a number of specialized companies which are distinct parts of this work. Usually, the foreign players use such consultants, whether in labor, environmental or customs area. The fact that we offer a nearly complete package, with some subcontracted consultants, is a very great convenience.” says Prates. “Clients have expressed great satisfaction. And demand has grown in this area.” adds Cristiane.
Surprise Box
Partnerships are essential because large enterprises have multiple regulatory aspects. “The characteristic of Forship work is essentially multidisciplinary. We carry out any complex industrial project, whether offshore or onshore (petrochemical companies, power companies, mining houses, etc.).”observes Antonio Prates.
“The regulatory aspect is a surprise box. Anything can happen, from a labor issue to a technical problem, an environmental requirement, etc. To meet this demand, we mobilize internal resources, skilled professionals who work directly in the project and can be allocated for a research in the regulatory area, or, in some cases, we may contract specific consultants.” highlights the Executive.
The starting point of this whole process occurred when, a few years ago, the consortium in charge of a project for Petrobras required a study in the regulatory area, and Forship developed it in addition to the commissioning work. It did not take long for other clients, with complex demands, begin to require regulatory support for projects carried out by the engineering company.
The Director of Engineering confirms that the high volume of regulatory requirements always frighten companies. “Every country has regulatory bodies, but Brazil excels them all,” jokes the Executive. “The shock is the amount of regulations and how to interpret each one.” He said it is important to evaluate two different ways. “Sometimes the solution A has the lowest risk, but is extremely costly, requires project change, etc. But there is another way, the solution B. Let’s minimize the risk. We prepare the technical report this way. It is a matter of managing costs and risks.”
New Consolidated Area
In the beginning of 2008, the first specific contract for supply of this type of support was signed with P&M DI BV, the consortium between Petrobras and Mitsui Group. “P&M is responsible for the construction of two drilling rigs that were going to operate abroad in Petrobras projects. However, due to acceleration of the drilling activities in oil and gas fields in Brazil, P&M decided to analyze the possibility of adapting these drilling rigs to operate in Brazilian waters” highlights Antonio Prates.
Forship was contracted to develop a study of the impact of this decision on the design and construction of vessels. The work lasted a month, and the end product was a document summarizing the guidelines for compliance with the requirements from the Brazilian Ministry of Labor and Employment (MTE – Ministério do Trabalho e Emprego), the Directorate of Ports and Coasts (DPC – Diretoria de Portos e Costas), the National Agency for Telecommunications (Anatel – Agência Nacional de Telecomunicações), the National Petroleum Agency (ANP – Agência Nacional de Petróleo), Internal Revenue Service (RFB – Receita Federal do Brasil), as well as the National Council for the Environment (CONAMA – Conselho Nacional de Meio Ambiente) and the Brazilian Institute of the Environment (IBAMA – Instituto Brasileiro de Meio Ambiente), supervisory and regulatory bodies, respectively, of the Ministry of the Environment.
Soon after, Forship began the services for a broader project with Hydro Brasil. The Brazilian company is providing regulatory support for the Peregrino field development project, from the consortium formed by Hydro (of Norway) and Anadarko (of USA), which operated this asset in the south of Campos Basin. The following year, StatoilHydro, a result of the merger between Statoil and Hydro, took complete control of this asset, which since 2009 became into only Statoil.
The products and services under the contract with Forship include compliance with the Maritime Authority standards, from MTE and ANP, including the development of directives and operational procedures for compliance with the Brazilian standards, analysis of project and supply documentation, translation of standards, as well as answer to technical queries of the client.
Forship contract, with one of the most complete scopes in the regulatory support area, was signed in May 2008 with Maersk (of Denmark), to provide regulatory consultancy and specialized manpower for the FPSO Peregrino project. This FPSO, which will be installed in the field of the same name (operated by the Norwegian Statoil), with a production capacity of 100 barrels of oil per day, is being built in Dalian, China, and the modules integration at Keppel shipyard, Singapore. Maersk is responsible not only for the design and construction of this FPSO, but also for its operation and maintenance in the Brazilian waters.
The production system of Peregrino field foresees the installation of two fixed platforms and an FPSO. The jackets have been acquired by contract with Kiewit Offshore shipyard, in the USA, and the FPSO was chartered by Maersk. The development plan of Peregrino field foresees 30 (thirty) production and 7 (seven) injection wells.
Forship contract foresees compliance with a set of requirements, from the Ministry of Labor and Employment (MTE), the Directorate of Ports and Coasts (DPC), the Internal Revenue Service (RFB), the National Agency for Telecommunications (Anatel), and the National Petroleum Agency (ANP).
“The project also involves the allocation of experts from Forship Rio and Forship Asia, in Singapore, especially when the FPSO is near the sail way to Brazil, for the coordination of activities related to NR-13 and NR-10, as well as verification of the fiscal measurement system, according to the criteria of ANP.” said Cristiane Guimarães.
Forship current portfolio includes, besides commissioning services, operation & maintenance, construction & assembly, as well as technical consulting services. Regulatory services became a new line of business of the company. According to Antonio Prates, “For Forship, commissioning was the key word some time ago; now it is operability.”
Positive Expectation
According to the evaluation of Antonio Prates, the new service line will have many clients, mainly due to acceleration of the Oil & Gas industry. “I see a growing and constant demand in this sector.” he said. It is growing due to the compliance needs of the companies, foreign operators, which are being established in Brazil.
“They have this grace period to comply with the Brazilian regulations, understand, interpret, and perform all the activities according to the requirements in the country.” says Cristiane. “And it is constant because these standards are under continuous change: many of them are still being developed and organized; there are changes from time to time. And we have to continuously update this information.”
The new regulatory milestone, related to pre-salt, will also influence this service. Antonio Prates and Cristiane Guimarães say, so far, there has been no demand for regulatory support in relation to pre-salt. “The market is concerned, waiting for the rules of the game. This will certainly have technical implications. This change will have consequences, evolutions. The technical regulations will be changed.” values Antonio Prates, saying that, at present, the support area is more attentive to another aspect, which will have a great demand: the local content; in other words, good businesses ahead of the new business area of Forship.
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