The Schiehallion Field is situated in the UK waters of the North Atlantic, some 100 miles west of the Shetland Islands. The field is now successfully producing oil, utilising a newbuild FPSO, currently the largest of its type in operation, together with subsea wellheads, flowlines and flexible risers.
Although the field came on stream as scheduled in July 1998, many problems were experienced and overcome during the design, construction and commissioning of the FPSO. This paper gives details of the most significant and examines their root cause. The paper examines the project management and contracting strategies used for the development, how these worked in practice and how they were amended as a result of early difficulties.
The provision of the FPSO was conceived as an alliance between BP and the three main contractors, with arrangements for sharing risk and reward between the parties. However, the management and contracting strategies had to be radically changed during the development phase. The paper highlights how strategic decisions made during the feasibility phase determined the root cause of most of the resulting design and construction problems.
The paper concludes that there is no "one best way" to execute a project. Each mix of technology and contractors is affected by different drivers, and hence needs a different approach. The paper provides other operators with valuable insights into the technical challenges specific to FPSO's and to management issues which can affect project performance.
Schiehallion represents a capital investment of some $1.5 billion, split approximately three ways for the major components of the development: wells and subsurface; subsea; and FPSO. This paper focuses on the latter of these components, the FPSO design, construction and commissioning; its execution and some of the major issues leading to its delivery for sailaway to location in January 1998.
A pre-sanction contract was awarded to a consortium of three contractors in June 1995, following the evaluation of offers based on the conceptual designs of a number of consortia. The objective of the pre-sanction phase was to develop the concept to a point at which the costs and schedule were sufficiently robust for the development to be sanctioned by the field partners.
Partner and governmental sanction of the development scheme and budget was approved in March 1996. First steel was cut for the hull in October 1995, prior to sanction, at the contractor's risk, and for the turret and topsides shortly after sanction. The keel was laid in June 1996. Topsides equipment delivery and installation, including the turret, were underway by 1st quarter 1997. FPSO completion, ready for installation, occurred in early January 1998. Installation was delayed waiting for suitable weather, but was achieved in April, allowing first oil to be delivered in July 1998 as sanctioned.
The hull is of a double sided, single bottomed construction, the double sides serving as ballast tanks. Processed oil is stored in seven pairs of tanks, one pair forward of the turret. Cargo, inert gas and vent piping is supported on the main deck. The accommodation is located in a safe area at the stern of the vessel, behind a fire and blast wall. The central control room is situated within the accommodation. The "engine space" below the accommodation is utilised for utility equipment and electrical switchgear. A second electrical and control equipment room is situated in the forecastle. Cabling from the fore and aft equipment rooms is routed down each side of the hull at main deck level.