The lead time for offshore projects has traditionally ranged from three to five years, from the time the operator commits to a development until first production is achieved. During this period a number of basic assumptions are made upon which the financial viability of the project is evaluated. These assumptions tend to cover both commercial and technical factors, such as type of development, field life, oil price, inflation etc., and during the period of the project the relationship between these factors will change. The impact of the rising oil price in the 1970s provided unexpected windfalls to operating companies, while the corresponding fall in 1986 resulted in a significant belt-tightening exercise During the project cycle, decisions previously made on the basis for the development will be questioned in a never ending search to keep the project "on schedule and within budget". The engineering industry, for example, will be very familiar with weight-saving (shaving) exercises as topsides become heavier and budgets spiral upwards.

However, even in the price collapse of 1986, the industry did not shelve projects which they had started, instead, companies looked for the opportunity to reassess earlier decisions and to effect changes/reductions within their budgets.

During a project it is the operator who retains control over the budget and who will make the key decisions. In the preliminary engineering phase, detail evaluations of various schemes will be undertaken and an approved development configuration will ultimately be selected The selection process will consider both technical and commercial factors and relate them to safety, reliability and cost effectiveness. A cheap but unproven option will be penalized through the application of a higher contingency factor than an option that demonstrates the use of proven technology.

If the FPF is to be seen as a serious contender for a development project then it will need to demonstrate low risk and high reliability. There is little benefit in trying to persuade the oil companies that a "new FPF design concept" will offer even greater savings unless they are already satisfied that the FPF is technically and financially competitive with other development schemes. It is one thing to suggest that savings of up to 30% may be made on the cost of a new-built FPF, through the application of 20/20 hindsight, but this will not convince operators that they can be any more confident in the performance of the unit at the end of the day.

1986 was a year that saw the delivery of two new concepts in floating production. The Petrojarl PTS, a sophisticated monohull, began production testing on the Oseberg Field for Norsk Hydro, while the GVA 5000 FPV began production for the North Sea Sun Oil operated Balmoral Field. These two units share the distinction that in their own class they were the world's first purpose-designed and -built floating production units; they also share the distinction that both were ordered in a high oil-price environment.

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