Elgin and Franklin fields will be operated by Elf Exploration UK plc (EEUK) in an environment quite different from earlier generations of North Sea developments. Production personnel are becoming increasingly exposed to fluctuating commercial pressures in the oil & gas industry and need to be prepared to respond to these. At the same time, more and more Operators consider some functions which are important to successful production as ‘non-core’ activities and look to contractors to provide and support these functions through contracts which motivate performance.

Not only are skills transferring between Operators and contractors but also technology is being employed to reduce the size of offshore crews. In addition, production from Elgin and Franklin will commence under a goal setting legislative regime, which increases pressure upon Operators to ensure that they have access to the right people to ensure safe and responsible operation.

In an environment where competition for people with the right mix of knowledge, experience and adaptability is strong, EEUK has adopted a strategy for operation and maintenance of Elgin and Franklin which will enable contractors to demonstrate their commitment to new ways of working. Some companies that have supplied critical equipment and systems, have been given the opportunity to be involved long term in the successful and safe production of gas and condensate.

This paper discusses how EEUK has considered the risks of trends in contracting strategy, which are relatively new to them as a company, and balanced these risks against benefits of new ways of working. Through development of a suite of contracts to support operation and maintenance of Elgin and Franklin, EEUK has recognised the need to obtain services from the most appropriate source. Performance measures and incentives, which are being established, take account of the responsibilities and commercial considerations of both EEUK and its contractors.

The paper concludes with a summary of lessons learned so far in implementing a strategy that requires EEUK to manage some complex contractual relationships when Elgin and Franklin enters its Production Phase in year 2000.

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