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ISSUE#1 | 2016

Performance Matters

www.kcadeutag.com

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Whilst we performed relatively well compared to our peers in 2015, 2016 is proving to be an extremely challenging year for our business as operators continue to question their forward drilling plans and we experience increasing pressure to reduce our prices further. Whilst there are some new business opportunities out there, these continue to be limited.

Having worked in the oil industry for over 30 years, this is one of the most difficult downturns I have ever experienced. We cannot avoid the harsh reality of the current outlook but by working as one team the KCA Deutag Way, we will make the very best of the year ahead. As the current conditions continue it is up to each one of us to get the basics right and do our jobs safely and to the best of our ability so that we keep delivering industry leading operational and HSE performance.

It is also important for us all to support each other to keep motivated and recognise those individuals who have performed in a way which exceeds our expectations. If we do all these things and control what we can control, we will be well positioned for any eventual recovery in activity.

Norrie McKayCEO

As I write this article it is the middle of May and the crude oil price, upon which the industry is now fixated, has finally shown some signs of an improvement, closing in on $50 per barrel. Although it is too early to say whether this improvement will be short lived or if it will be sustainable in the longer term, industry commentators seem to think that this is the start of something more meaningful, and let’s hope they are correct.

Recent disruption to production in key countries is the main reason for the current oil price surge as global stock levels are slightly reduced, and there have also been indications of increasing demand. These short term supply restrictions however need to translate into a longer term correction in the supply versus demand dynamics of our market for there to be a need to increase drilling activity once again.

Even if the price of oil does continue to rise to higher and sustainable levels there will be no dramatic change in our activity straight away. Our business relies on the operational budgets of our clients and they will take some time to decide to increase activity, so we will still have a tough period ahead of us even then.

“We cannot avoid the harsh reality of the current outlook but by working as one team the KCA Deutag Way, we will make the very best of the year ahead.”

Message from the CEO

“This is one of the most difficult downturns I have ever experienced.”

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Contents03 News

04 Our 2015 Annual Award Winners

08 How to Succeed in a Challenging Market 09 Raising Environmental Awareness Ahmad Shahid takes only 4 weeks to earn his White Helmet

10 Performance Matters

12 Baltic Sea Circle 2016

13 Five Minutes with Sheena Houston

14 Land Update

15 Getting the Most Out of a Dollar

16 First Two New Bentec Iron Roughnecks in Operation

17 Moderating the SPE’s PetroBowl Competition Remembering Those Who Died in the Norway Helicopter Crash 18 Drilling Automation

19 The Clair Ridge Sail Away Statoil Renews Norwegian North Sea Drilling Contracts

Get in touchWe hope you enjoy this edition of Venture. If you have any feedback, or suggestions for articles in the next edition, please contact: communications@kcadeutag.com

NewsDART® Oman successfully delivers its first ever IWCF accredited well control coursesEarlier this year DART® Oman delivered its first ever IWCF accredited well course. The Level 3 and 4 Drilling Well Control courses were successfully completed with the assistance of DART® UK, Dinesh Babu and Murshid Al Kindi.

Initially set up to serve candidates in Oman it is hoped that other countries will use DART® Oman to deliver Well Control and Stuck Pipe courses providing quality cost effective training without the use of third party providers. Oman will operate as an additional DART® training centre to Aberdeen.

The crew of the T-67 celebrates one year without a recordable incident Our T-67 rig in Algeria achieved the milestone of one year TRI free on 17 March 2016.

At the time Country Manager, Jackey Jipping said: “This achievement is testament to the skills of the whole team, their dedication to the operation and continued focus on providing an excellent service whilst maintaining a safe, effective and trouble-free operation.

“This milestone is never reached by chance, but though dedication, motivation, teamwork and safe systems of work.

“I would like to thank everyone who has been part of and contributed to the T-67 operation and wish you continued success moving forward.”

The Iron Roughneck goes into Production for an Algerian ClientIn December 2015 Bentec won a major contract for the delivery and installation of 12 Iron Roughnecks for an Algerian customer. Facing strong international competition the Bentec sales team convinced the customer to make the order with new technical features and a value adding concept. “This order is a huge step in the market and shows once more that Bentec has become a recognised quality supplier in the oil and gas industry”, says Thomas Kipker, Head of Product Management.

The Piltun team offshore Sakhalin Island achieves 1 year TRI freeCongratulations to Rig Superintendents, Alan Paterson, Goran Perec and Drew Mair and their teams on reaching a one year Total Recordable Incident free operation on 2 March.

The team’s commitment to working the KCA Deutag Way is second to none and the attitude and effort shown in every aspect of their work is very well appreciated by both the client and KCA Deutag alike. Keep up the great work guys. You are doing us proud.

Our 2015Award

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Contribution through Excellence Award RDS Project Team – Gullfaks BSteinar Gjesteby (left) and Bjarne Tresselt (right) accept the award on behalf of the team The Gullfaks B Drilling Upgrade project was awarded to RDS in October 2012. The main parts of the scope were the pipe deck crane, horizontal to vertical and vertical pipe handling, draw-works brake, SCR switchboard, skidding control system and integration of the control system. The project completed in September 2015, TRI free and one month ahead of schedule, taking 105,000 onshore hours and 41,000 offshore hours to complete this project.

Offshore Rig of the Year Award - Lunskoye Senior Rig Manager, Frank Sinclair being presented with the Offshore Rig of the Year Award by Bob Petrie - Country Manager, Sakhalin Island.

The Lunskoye A crew – Offshore Platform of the Year The Lunskoye A team consistently delivered impressive results in 2015 and on 5 November celebrated 182 perfect days, whilst completing a range of complicated operational activities. The rig performed extremely well over the course of 2015 and it was awarded six “gold medals” by SEIC for its strong performance last year.

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AnnualWinners

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The Azerbaijan Team - Country of the Year With seven year round operating strings, our Azerbaijan operation is the largest in the Offshore Business Unit. Throughout 2015 the country delivered a number of notable successes, including the Chirag being awarded the “Bob Dudley” Award for safety performance, the 10 yearly shut down of the West Azeri which was delivered ahead of schedule and the Central Azeri reaching 12 years’ LTI free. Overall the Country exceeded expectations on safety and rig performance. In December 2015, the Azerbaijan team also successfully retained its entire work scope through a competitive tender process.

The crew of the T-400 - Land Rig of the Year The T-400 was the clear winner in this category. It had another exceptional year in 2015 and had been TRI free since it first spudded as a Prototype HR 4000 rig in the VCNG field 4.5 years ago. Built by Bentec, the rig’s drilling and commercial performance is very strong.

Our 2015Award

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Holger Egbers and Uwe Heemann accepting the Project of the Year Award from Dirk Schulze, CEO of Bentec, on behalf of the KCA Deutag and Bentec Land Rig Delivery Teams

The KCA Deutag and Bentec Land Rig Delivery Teams produced an outstanding performance in 2015, completing the design and build of eight new land rigs for clients in Oman, Brunei and Russia ahead or on schedule, and on budget.

The Offshore Award Winners - Rune Lorentzen, President Offshore and RDS (second from left) presents the awards to Albee Armstrong (far left) winner of the CEO’s Special Recognition Award, Phil Woods, Azerbaijan General Manager (second from left) who accepted the Country of the Year Award on behalf of the Azerbaijan Team and Bob Petrie, Country Manager - Sakhalin Island (far right) who accepted the award on behalf of Lunskoye A, winner of the Offshore Rig of the Year.

Team of the Year - The Global HR Team In a very challenging year, the global HR team worked tirelessly to manage the process of change which the business has undergone. In addition, to introducing new worldwide standards in the early part of 2015, the team successfully launched Project Solar in pilot countries across the world and completed the internal restructuring of the HR team, establishing two new service centres based in Aberdeen and Dubai in October, to better service the group. They completed all of this whilst providing extensive support to the group’s ongoing cost reduction programme.

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AnnualWinners

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Albee Armstrong - Winner of the CEO’s Special Recognition AwardOperations Manager, Albee Armstrong retired in March after a 20 year career with KCA Deutag. During that time he worked in various locations for us including Iran, Libya, Saudi Arabia and Sakhalin before taking up his position in Myanmar. Here he spearheaded a fantastic turnaround in the safety performance of the SHWE platform and in September last year it passed a key milestone of one year, TRI and LTI free.

CEO’s Special Recognition AwardGroup Head of Operations Geoff Monsen, left receiving the CEO’s Special Recognition Award from Jack Winton, outgoing President of HSSE and Operations.Geoff received the CEO Special Recognition Award for the instrumental role he played in successfully resolving the well control issue we had last year. During this time Geoff spent 10 weeks in-country supporting the team and our client, and his knowledge and experience proved invaluable.

Snezhana Lotkova, Sakhalin HR Manager accepting the Team of the Year Award from Bob Petrie, Country Manager – Sakhalin IslandSnezhana joined the team in Sakhalin in 2004 and is committed to her charity work which now supports three social and rehabilitation centres for children aging from 3 to 18 years old in the cities of Korsakov, Aniva and Yuzhno, 6 disabled children and an orphanage.

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How to Succeed in a Challenging Marketby Rune Lorentzen, President of Offshore and RDS

Contributed by: Offshore

that are available, we must be able continue to deliver an industry leading HSE and operational performance.

I am certain that 2016 is going to be a very challenging year as offshore activity continues to be low and investment by the oil exploration and production companies is delayed or deferred until the oil price rises.

This year we must control what we can control and continue to operate our rigs safely, effectively and trouble-free. We must continue to deliver at the highest level and at the same time give value for money to our clients.

We have two major operational readiness projects ongoing this year, Hebron in Canada and the Cat-J for Norway. In the current environment we cannot afford to get these wrong and we should do everything possible to impress our clients on these projects.

We must also continue to focus on managing our costs. There is no doubt that we will see continued cost pressures from our clients, and we must be able to respond to that.

The merger of RDS and the Offshore division last year has not only helped us to improve our efficiency, but the two divisions are now working much more closely as a team, enabling KCA Deutag to provide a much better service offering to existing and new clients with a one stop shop for engineering design and platform drilling services. This is invaluable in the current climate.

For RDS, 2016 will be very difficult. There are likely to be no greenfield projects as the oil majors delay investing in this area until the oil price improves, but we do expect to see some new brownfield projects, which have been less impacted by the current market conditions.

However, whether you work in Offshore or RDS, we are all committed as one team to making the very best of 2016. We can only do that by delivering an outstanding operational and safety performance. Without that we will not succeed.

Throughout the very difficult business environment in 2015, the Offshore Division worked hard to successfully retain all its contracts by delivering a best in class HSE and operational performance which prevented our clients from suspending drilling operations or going to tender. This is a fantastic achievement in the current environment, particularly when the division is the world’s largest international platform services operator, with approximately 40 client owned platforms under management, and our competitors are keen to show to our clients that they can offer a “better solution” and, importantly in this market, can do it cheaper than us.

The statistics don’t lie however - In 2015 the Offshore Division recorded its best ever total recordable incident rate of 0.45 per 200,000 man hours worked. In achieving this we also reduced dropped objects by 28% and our non-productive time fell to 1.84% at the year end, our lowest ever.

We also delivered some real safety highlights during 2015. In September, the SHWE team in Myanmar led by Operations Manager, Albee Armstrong, turned around the safety performance of the platform, passing a key milestone of one year, TRI and LTI free. As a result of this Albee received our CEO’s Special Recognition Award in the 2015 KCA Deutag Annual Awards.

This high quality HSE performance has not gone unnoticed by our clients. In May 2015, in recognition of our excellent safety performance on the Murchison platform in the UK sector of the North Sea, the International Association of Drilling Contractors presented us with the Chairman’s award for “Best Safety Performance of an Individual Unit” and in February of this year KCA Deutag in Norway was awarded ExxonMobil’s HSE Award for 2015.

Our operational and HSE performance was also instrumental in KCA Deutag Azerbaijan winning the re-tender for the operations and maintenance of all seven BP platforms in the Caspian Sea, retaining its entire work scope. In conjunction with this RDS also won the contract for engineering support services on all drilling packages for projects in the Caspian Sea that are operated by BP from the Azerbaijan, Georgia and the Turkey Region.

The conclusion from all of this is that to retain existing contracts and to secure the limited number of new ones

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Ahmad Shahid takes only 4 weeks to earn his White Helmet

Raising Environmental Awareness

Having originally joined KCA Deutag in Pakistan in 2009, Ahmad Shahid joined the T-202 operation in June 2015 as a Derrickman. He completed the required mandatory and advanced rig training with the rest of crew before the operation started up in September of last year. With his excellent working style and approach towards safety, Ahmad was recognised as a potential candidate for the position of Assistant Driller.

The global competence system (“GCS”) began to be rolled out on the T-202 in October. All the crews were given a clear message that any promotion would be dependent on the successful completion of GCS training and this would form part of each person’s appraisal.

With the required skill set and motivation, Ahmad worked with his supervisors to complete the Derrickman logbook in 4 weeks. Once this had been verified, he was given an opportunity to complete his IWCF level 3 training, which Ahmad successfully passed, and was subsequently promoted to the position of Assistant Driller in December, 2015.

Ahmad said “With the global competence system I found out what I knew and how to improve my way of working. I am now very much looking forward to growing my experience further with KCA Deutag.”

Let’s all congratulate Ahmad on achieving his goals and wish him all the best in his future career with KCA Deutag working the KCA Deutag Way!

On Wednesday 30 March, the UK arranged an environmental awareness session for the staff in Minto House in Aberdeen, as part of their annual HSEQ Plan. The session was very well attended on the day, providing an excellent opportunity to discuss how we monitor and measure our office waste figures. There was also active participation in a “Bin Quiz”, proving to be both educational and competitive for those taking part. The UK’s “Drop in the Ocean” video, which has been rolled out to excellent effect across the UK operation and clients, also provided an overview of our environmental responsibilities offshore.

Environmental Stewardship is one of KCA Deutag’s Core Values, where we aim to respect and minimise the effect we have on the environment. KCA Deutag in Aberdeen now provides compostable plates, soup bowls, cutlery and water cups which can be turned into accredited compost within 7 weeks and is now widely used by farmers in the North East of Scotland. Thanks to everyone who attended and actively participated on the day.

Contributed by: HSSE, Aberdeen

Contributed by: Land

In picture: Ray Harrison, HSEQ UK Manager, with event organiser Jane Findlater and

the winners of the “Bin Quiz”, Bruce Cowen, Arthur Murphy and Heather Cassie

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Currently led by Country Manager Phil Woods, KCA Deutag has been operating in the country since 1995 when it was awarded its first

offshore drilling contract and has a twenty year history of working with BP in Azerbaijan providing design, construction support, platform

services, commissioning and brownfield engineering services to its platform drilling operations. Since then 228 wells have been drilled,

and in 2015 Azerbaijan won KCA Deutag’s Country of the Year award for its safety and rig performance.

KCA Deutag awarded first platform drilling contract by BP The Chirag is mobilised in 1995. First oil delivered in November 199724 slotsWater depth of 121mRig Manager, Dave Wood

BP’s Shah Deniz sails awayDelivers first oil in October 200615 slots105m water depthKCAD runner up rig of the year 2015Rolling year recordable free for 2015Rig Manager, Graham Halidu

BP’s Central Azerti sails awayDelivers first oil in July 200548 slotsWater depth of 130mBecomes 12 years LTI free in 2015Rolling year recordable free for 2015Rig Manager, Tomislav Klenkar

BP’s West Azeri sales awayDelivers first oil in December 2005 48 slotsWater depth 112m10 yearly shut-down delivered ahead of schedule in 2015Rig Manager, John Smith

In December of last year, KCA Deutag in Azerbaijan won the re-tender for its entire work scope for the operations and maintenance of BP Exploration’s seven platforms in the Caspian Sea, whilst RDS was also awarded the engineering support services contract.

Performance MattersContributed by: Offshore

1995 February 2005 September 2005 April 2006

HSE 0.12, reduced from 0.52 in 2013

NPT1.54, compared to the target of 2.25

Number of wells drilled23 wells delivered, compared to 18 wells planned 21% improvement 820 days shaved off the planned AFE

Savings achievedWells delivered ahead of plan allowed more wells to be drilled demonstrating efficiency with enhanced production to the client

KCA Deutag Azerbaijan 2015 Performance Statistics

Embedding A Strong HSE Culture Into Performance

Close engagement with key stakeholders Crew participation and involvement at every stageOne to one workshops on improving HSE and operational performance

Well delivery KPI’s embedded in the well construction processRaising the bar on preventing incidentsEmbedding intrusive investigations into every incident and taking the lessons learned forward to prevent further incidentsReporting and implementing sustainable improvements

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Commenting on winning the BP re-tender Phil said “At the end of the day you can talk a good talk but performance really does matter, especially in the current environment. At the time of the tender we had been really focusing for some time on improving our performance and demonstrating to our client the importance of safety at every level of well delivery. As a result we exceeded our client’s expectations achieving a substantial reduction in non-productive time well ahead of previous years’ targets, and recording one of our lowest ever recordable incident targets of 0.12.”

BP’s East Azeri sails awayDelivers first oil in October 200648 slots150m drilling depth Rolling year recordable free for 2015Rig Manager, Drew Tannock

BP’s Deepwater Gunashli sails awayDelivers first oil in April 200848 slots176m water depthRolling year recordable free for 2015Rig Manager, Brian Jennings

BP’s West Chirag sails awayDelivers first oil in November 201348 slots169m water depth Rig Manager, William Blanchard

In December of last year, KCA Deutag in Azerbaijan won the re-tender for its entire work scope for the operations and maintenance of BP Exploration’s seven platforms in the Caspian Sea, whilst RDS was also awarded the engineering support services contract.

Performance Matters

July 2006 July 2007 July 2013

KCA Deutag’s first platform in AzerbaijanRig Manager, Dave Wood – 24 years with KCA Deutag, 6 so far in Azerbaijan15 original crew members still on the Chirag today, all local employeesNo process safety events in the past 4 yearsExcellent team work, with a notable desire by the team to continue to learn and improveImpressive safety recordNo well control incidentsTransparency with incident reportingVisible leadership

One of the largest countries in the offshore business unitA total workforce of 719, servicing 7 platforms

545 local Azeri citizens174 expats

75.4% nationalisation

The Importance Of Deep Dives Into Accident Investigations

Played a vital role in reducing TRIREnabled us to deeply address the underlying causes of incidentsImproved the safety of our people Ensured the safe execution of our operationsPersonnel are now much more aware of why incidents happen and how to prevent future occurrences

Our Team

The Chirag 1, Winner Of The 2015 BP Bob Dudley Award For Safety

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Baltic Sea Circle 2016 - Bentec Service Engineers Rise to the Challenge

Contributed by: Bentec

Are you looking for something different and extraordinary next summer?” ask the organisers of the Baltic Sea Circle 2016 on their homepage. Bentec electrical service engineers Steffen Foppe, Christopher Gerlings and Nils Wanning decided to accept the challenge and signed up for the charity event.

This involves a 7,500 km road trip around the Baltic Sea with a car that is at least 20 years old and is worth less than €2,500. You can forget about using a navigation system or a GPS – This is not permitted and neither are highways. The rally starts in Hamburg on 18th June at the well-known Fish market and finishes there two weeks later with a big party on the finishing line and the prize giving ceremony.

“Give it all for your team and for a good cause” is the motto of event. Each team is required to raise €750 for charity in order to participate in the rally. Half of the money will go to the official charity partners of the Baltic Sea Circle and the other half will go to the charities chosen by the participants themselves.

At the moment Steffen, Christopher and Nils

spend every evening whipping their VW T3 van into shape. “This is a lot more work than we had expected. There is almost no part of the van we have not dismantled yet” says Steffen.

We wish our colleagues good luck in their adventure.

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project and generalist roles in both international HR, in the Offshore business unit and in UK HR while working for RDS.

During this time, I also spent two years studying part-time to obtain my postgraduate degree in Human Resources, becoming CIPD qualified last year. This was a lot of work but worth it in the end.

How do you like to relax outside work?Holidays - I love going to visit new places and experience new cultures. My most recent trip was touring the East and West coast of America. Nothing beats the buzz of New York. It was really special and I am sure I will be back there again soon.

What did you want to be when you were growing up? When I was quite young I wanted to be a vet as I was obsessed with animals but as I got older I think I just knew I wanted to do something people orientated that involved variety and exposure to lots of different things.

What are you currently reading or watching on TV? I am currently reading Breaking Night by Liz Murray. It’s a young woman’s memoir about overcoming challenges when she finds herself living on the streets at the age of 15.

Do you have any words of wisdom you’d like to share? Treat others in the same way that you would like to be treated. I am a firm believer in this and always ensure I practice it.

Five Minutes with Sheena Houston- HR Coordinator

Tell us about your role at KCA Deutag?I currently work as an HR Coordinator in the UK HR Service Centre in Aberdeen. This team was developed and implemented towards the end of last year. The Service Centre model is still very new to KCA Deutag and has seen a big change for HR and the business, with all routine UK HR advice and administration now centralised into one location for the first time. My role involves dealing with a variety of HR requests that come in on a daily basis and the administration of HR documentation. This ranges from for example processing new joiner or leaver paperwork, responding to compensation and benefits enquiries to recording sickness absence.

An important part of my role is to use my experience to add value to the service centre team and share that knowledge with my colleagues to ensure that everyone in the team understands and can assist in all areas of the business.

How do you usually start your day? I kick start my day by going to the gym. I find this wakes me up and sets me up for the day ahead!

What’s your favourite thing about your job? The variety of things I learn and am exposed to on a daily basis. There is never a dull moment in HR! I enjoy interacting and dealing with people, and the people I work with at KCA Deutag are great. I also like to solve new challenges and gain new experience to develop my skills.

How did you get to where you are now?I spent four years at Robert Gordon University studying for my undergraduate degree in business management. I completed my student placement with KCA Deutag during my third year there before returning 6 months after graduating to work in the Human Resources team. I have been with the company full-time now since 2012 and have worked in both

Following the launch of the new UK HR Service Centre last year, the communications team speaks to Sheena Houston, to find out more what it takes to be a modern HR specialist.

Interview by: Communications Team

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efficiently exiting markets where we no longer have activity, such as Gabon and Libya, and continually look at the structure of our business to ensure it is operating as efficiently as possible. Whilst this has led to tough decisions in some areas such as Europe and Nigeria, it is essential that we manage costs to ensure we can keep the business in these areas for when the market recovers.

For 2016 the priorities for the Land Division are very clear. We must deliver the level of operational excellence our clients demand by maintaining a strong safety record and eliminating as far as we possibly can non-productive time. Our target Total Recordable Incident Rate for this year is 0.48 - but I would want us do better than this and we know we can. In the last year all the incidents and injuries we have had could have been avoided if people had taken the time to think about the risks before acting.

In parallel with this we need to win new business. In the current market this is a challenge as there are so many companies chasing less work, but with our drilling expertise we are better placed than most. There are three layers to our new business strategy:

Increase utilisation by getting stacked rigs back to workIdentify opportunities for increased revenue stream, particularly in countries where we have substantial operations alreadyContinue to look for opportunities that will grow the Land business and offer good returns focusing on those that can add critical mass to our existing business or gain an entry to new market

Finally, we need to ensure that we optimise our cash spend by getting the best return for each dollar we spend and looking for long term structural ways to reduce our operating and capital expenditure.

If we do all of these things, there may be some bumps along the way, but I have no doubt that the Land division will successfully come through this current downturn in good shape.

At the time of writing the Land Division currently employs over 4,000 people in more than 15 countries, and owns and operates a fleet of 56 rigs - many of which are newly built or have been significantly renewed over the last ten years. We have a good presence in key markets and a strong reputation with our clients as a premium drilling contractor, performing well on many projects and operations. So there is a lot for us to be proud of and in my view we are well placed to not just survive the downturn but also to take advantage of opportunities as they arise.

There have been some great achievements in 2015. Russia saw full utilisation over the year and significantly exceeded its financial targets, as well as introducing a new rig, T507, into the fleet. We also set up an older rig, T392, to act as a training rig next to our base in Tyumen, which will allow us to sustain our growth in Russia through developing skilled operators for our equipment. In Oman we successfully mobilised the 5 Khazzan rigs. All of these are now drilling and we are seeing improvements in well delivery times. In Algeria we mobilised the T45 and at the end of the year started both this rig and the T212, achieving full utilisation in this important market as well. We also mobilised the new rig T203 to Brunei.

We cannot however escape the fact that in this market, there continues to be pressure to reduce costs further, and we have no option but to respond to this. Since my appointment in June last year, we have removed the Land division’s regional management structure and are currently in the process of relocating the majority of the business unit management team to Aberdeen, where I am now based. We have renewed our focus on

Land Updateby Simon Drew, President of Land

In the midst of the current market turbulence it’s easy to lose sight of the fact that we still have a large and very successful Land operation.

Contributed by: Land

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The ongoing market conditions which we are all currently experiencing place essential demands on each individual within Equipment & Maintenance Asset Integrity to promote innovative and pragmatic approaches which will reduce our cost base for the long-term.

The commitment of individuals as well as cross-company co-operation has contributed to a number of initiatives which are helping us to weather the strong headwinds facing our industry.

Our Owned Equipment Firstly, the Land Business Unit Asset Integrity Management Function has begun to centrally coordinate the technical approval of capitalised expenditure for all our equipment. This gives us the ability to view the full range of items in stock, helping us to improve utilisation of idle equipment and achieve cost savings.

Rentals GroupManaged by Scott McPherson, this group comprises Drilling Equipment Specialists Günther Blekker and Marco Krieger. Its main aim is to maximise the return on equipment across the Land Business Unit. The resulting revenues will be used to build-up a rental pool of well control equipment and drill pipe.

Drill Pipe Management With responsibility for the availability of drill pipe and inventory levels, Günther also monitors and co-ordinates Land’s operational needs as well as rental opportunities. In less than a year savings on new investments of $1.9M have been generated through this activity.

Well Control Equipment Management Similarly for Well Control, Marco monitors the availability and certification

status of our BOPs. This central overview enables him to finely balance the operational needs of the business with potential rental activity. In 2015 Land achieved almost full utilisation of its available well control equipment. During the same period $1.3M of additional revenue was generated for Europe.

The potential savings identified for well control equipment at the beginning of 2015 are currently being achieved through the purchase of KCA Deutag’s first BOP stack from a Chinese manufacturer for our Russian Operation. This will generate savings of 50% compared to equivalent western manufacturers.

Strategic Maintenance ApproachWe have also looked differently at the way we handle our major equipment overhauls and this has resulted in further efficiency improvements. E&M Manager Lothar Horstjann and Drilling Equipment Specialist Christian Plenter have laid the foundations to achieve annual savings of $1.9M. The key to this was to schedule equipment overhauls in line with operating hours and fuel consumption instead of a calendar based system. This approach has been developed for top drives and generator sets and is now being considered for other types of equipment as well.

The Group’s Future Focus Increased use of Innovative ideas and technologies including extending the use of performance improvement initiatives on new build rigs to existing KCA Deutag rigsImprovement of the project planning process to reduce financial losses through NPTIntensive promotion of alternative

maintenance approaches. Evaluation and, if possible, adaption of the mix between reactive, preventive, predictive and proactive maintenance with the aim of lowering the lifecycle cost involved Achievement of full utilisation of fit for purpose assets for either our own fleet or for rental purposesCompletion of API 4G CAT III/CAT IV Rig Structure Inspections by authorised internal KCA Deutag inspectorsContinued reduction in the use of third party companies for asset management tasks whenever possibleWorking with the Corporate team to assist end users by making the PM-Module more user friendly

A Team ApproachAll these cost saving initiatives, as always, are the result of team work and co-operation across many functions of our business starting from the initial idea, enthusiasm for a particular activity, realisation and integration into our strategies and standards, and finally implementation into our maintenance tasks. There is also a huge potential to improve our efficiency and establish new business opportunities from the work being carried out.

As Henry Ford, Founder of the Ford Motor Company once said: “Who always does what he is already able to do, always remains what he already is.”

Land Updateby Simon Drew, President of Land

Getting the Most Out of a Dollarby Dieter Diroll, Head of Asset Integrity, E&M Land

Contributed by: Land

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First two new Bentec Iron Roughnecks in operation

Contributed by: Bentec

The first was sold to a customer in the Czech Republic and the second is operating on the T-203 in Brunei. Both systems are remote-controlled and provide the fastest sequence based cycle-time during the make and break process. Compared to competitor systems, Bentec’s iron roughnecks stand out because they require less maintenance and as a result have the highest degree of uptime.

KCA Deutag T-203 Rig Manager, Ron Klunder says: The T-203 is a 2,000 HP Bentec Desert rig working in the tropical environment of Brunei. The Rig commenced operations on 29 October 2015 after extensive commissioning and testing by KCA Deutag and the Shell Global Rig Start-Up Team. It is one of the few complete Bentec rigs in the KCA Deutag fleet. (2,000 HP AC Draw works, HT-750 Top Drive, 1,600 HP AC Mud Pumps, Rotary, Hydraulic Cathead, Iron Roughneck and entire soft product range). The T-203 has the premiere on the TD-750-HT top drive and is the proud owner of the second Bentec IR-100.

If you start asking people what they think about the Bentec Iron Roughneck it’s all very

positive. For example, the Safety Trainer Officer particularly likes the dead man switch which has to be pushed when operating the Iron Roughneck. The Mechanic is impressed with the central lubrication system which makes his life easy and ensures all points are greased in accordance with the schedule. The Roughnecks are happy with the space saving design compared to models offered by the competition. The Driller finds the laser guided tool joint finder very efficient and accurate and I, as the Rig Manager, like the fact that the Bentec

Iron Roughneck IR-100 has not given us any problems whatsoever and that it is drastically reducing die consumption and therefore our rig costs. So, overall Bentec has a very satisfied customer here in Brunei.

“If you start asking people what they think about the Bentec Iron Roughneck

it’s all very positive.”

In the last edition of Venture Bentec announced the launch of its new iron roughneck. Today we are proud to report that the first

two roughnecks are already in operation.

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Moderating the SPE’s PetroBowl CompetitionImran Raza, Assistant Rig Manager in our Land division, talks about this new experience

Remembering those who died in the Norway Helicopter Crash

The helicopter was returning from the Gullfaks B platform in the North Sea, when it got into difficulties. Whilst KCA Deutag had no personnel on the aircraft the lives of the families, friends and colleagues of those who died has been changed forever, and our thoughts are with them and our personnel on the platform at this time.

We can never underestimate the importance of ensuring everyone associated with our operations gets home safely at the end of each day. All our other objectives pale in comparison. Please work safely in everything you do. Safety must be our number one objective.

Rune LorentzenPresident, Offshore and RDS

Regional qualifier competitions now take place in Africa, Asia Pacific, Europe, South America and Caribbean, the Middle East, and North America, and the best 36 teams are invited to the PetroBowl championship at the SPE Annual Technical Conference and Exhibition.

I have been a member of the SPE in the past, and when the position of moderator of the event became available thought it was the right time for me to apply for it, as I have recently moved into a managerial role and I felt that it would help me to achieve my personal and organisational targets.

The position is totally voluntary and since I hadn’t any previous experience I had to go through two rounds of interviews. So, I was delighted when I got the role. As the moderator I was responsible for running the qualifier with 8 universities participating from different countries. I had to ask questions, judge whether the answers were

correct, refer to the jury if I was in doubt and keep a track of the time.

The event was very important for me so I prepared well for it by going through previous PetroBowl events videos and memorising the competition rules. I also had to speak in front of an audience. This wasn’t new for me, but still seemed challenging. As the saying goes “the biggest enemy of you is your own fear”. I kicked-off the event feeling slightly nervous but quickly settled to moderate the event for the rest of that day.

Some senior figures in the industry were also there either in the jury or as speakers. Representing KCA Deutag in the presence of such an audience was an excellent experience for me and the whole event overall was very interesting. I am now looking at possible options for becoming an SPE Representative, and being an active member not only in the business side of the industry but also its social side.

Contributed by: Land

On Friday 29th of April thirteen people lost their lives in a tragic helicopter accident off the Norwegian coast in a very dark day for

the oil industry.

The PetroBowl competition pitches the Society of Petroleum Engineers student chapter teams against each other in a series of quick-fire rounds, answering technical and non-technical industry-related questions.

Contributed by: Offshore

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On drilling rigs we currently see mainly rig equipment automation which promotes a hands-off approach to the operation of heavy machinery, eliminating the number of people in the red zone and improving efficiency, all with the objective of meeting our zero harm core value targets. There is, however, a second application for automation which is becoming more and more important: SCADA (Supervisory Control and Data Acquisition).

In order to keep up with the times, KCA Deutag has developed the FX Concept in close cooperation with Bentec and our clients. The FX Concept is a data interface between rig equipment and a remote computer which is capable of recording and manipulating drilling parameters. The aim is to capture learnings and to improve drilling performance by providing automated supervisory control to the driller.

The first step is the F Concept, which uses a one directional interface to transmit process and drilling equipment data to a third party data acquisition computer. The second step is the FX Concept featuring a two way data connection, which permits the client or a third party not only to receive data, but also to send commands to the rig equipment. Both systems use the industrial OPC protocol via Modbus. OPC is a control system specification providing access to raw, interpolated aggregate data. The markup language is WITSML, which is a commonly recognised data transfer standard in the oil and gas industry.

Currently there are two systems developed for remote management. The first takes control of the weight on the bit (WOB) and the top drive speed with the objective of improving the rate of penetration (ROP). The second allows the client to remotely operate all rig equipment from “slips out” to “slips in”.

These give the client the opportunity to remotely run in / pull out of the hole, drill, ream and control tool face orientation within the anti-collision zones of the travelling block in the derrick, by utilising their own algorithm. Both systems are based on the

same hardware and software. Each of the FX Rigs is equipped with a dedicated Programme Logic Controller (PLC), an HMI display screen, automated speed throttles and indicator lights. The PLC checks the received commands for plausibility, machine limits, equipment status and applicable safety constraints, such as block position and pressure limit before permission is given to alter the rig’s internal equipment parameters. The HMI display screen provides feedback to the driller on the remote system and parameter status. Motor driven speed and torque throttles move with the remotely provided set value enabling a seamless hand-over/ take-over in case there are any issues,

for instance through an unexpected loss of data communication. A dedicated, hardwired button allows the driller to decide when he accepts remote supervisory control and when to intervene. A flick of a switch or any manual intervention to the speed or torque setting will cancel the automated activity immediately. An indicator light also displays the status and requests from the remote system to take over control.

The real advantage during the engineering of this new technology has been the single source of the rig equipment, because all the rigs were fabricated by Bentec. Bentec rigs already had such a high level of equipment integrity and automation in-built and this, together with the close cooperation of the Bentec engineering department, was key to successfully developing the Supervisory Control and Data Acquisition interface.

At the current time, three FX Concept systems are installed on KCA Deutag’s land rigs for different clients in the Netherlands and the Sultanate of Oman. All of them have recently passed the final hardware, software and risk assessments ready for the first test run under real conditions later this year.

Drilling Automation- the KCAD FX Concept

by Christian Vahle, Electrical Projects Engineer LEMP

New automation technologies on drilling rigs may completely change the way we operate our land rigs. Drilling has always been just in the hands of people, but now this is about to change with the help of computer-controlled drilling.

Contributed by: Land

“The real advantage during the engineering of this new technology has been the single source of the rig

equipment”

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RDS have been involved in the Clair Ridge project from the concept study in 2006 and at its peak the RDS London project employed over 230 people.

RDS have been involved throughout the project; the pre-FEED, FEED and Detailed Design phases, and will continue to provide hook up and commissioning support throughout the remainder of 2016 in Aberdeen.

The RDS team has recorded zero incidents throughout the various engineering, factory acceptance tests and construction support phases which is testament to the robust approach to HSE

In March of this year we were delighted to announce that KCA Deutag had retained the drilling contract for seven of Statoil’s platforms on the Norwegian Continental Shelf.

The contract is for the provision of drilling operations, maintenance services and engineering support for the Gullfaks and Oseberg fields. This two year extension from the original contract period commences on 1 October 2016 and will run to October 2018 with an additional option to extend by two further periods of two years each. It is worth up to NOK 2 billion.

KCA Deutag also operates the Kvitebjørn platform for Statoil under a separate contract and in 2013 the group was awarded the management,

and belief in safe, effective and trouble-free operations.The Clair Ridge drilling platform will stand in 140m water and is a fully mechanised rig. The combined weight of the DES and DSM is approximately 7,500 tonnes.

Commenting on the success of this project, Andy Lawson, RDS Business Manager – UK Greenfield said “We have overcome a number of challenges throughout this Project and seeing the modules ready to go in all their glory is a proud moment for us and my thanks go out to all involved in supporting this significant achievement for RDS.”

operation and maintenance of two Category J jack-up rigs which will also begin operating on the Norwegian Continental Shelf next year.

At the time of the award Rune Lorentzen, President of Offshore and RDS said: “Today’s contract award extends a long standing relationship with Statoil in Norway. We are delighted that the quality of our operational performance and the value that KCA Deutag can bring as a premium drilling contractor has been recognised. We look forward to continuing to improve our performance as we move forward.”

Paul Horne, Norway Country Manager said “Congratulations to the whole team. This is a great achievement in such challenging times.”

The Clair Ridge Sail Away

Statoil Renews Norwegian North Sea Drilling Contracts

In March of this year, the Clair Ridge platform reached a major milestone when the RDS designed drilling facility modules were loaded onto a vessel for sail-away from the Hyundai Heavy Industries yard in Ulsan, South Korea.

Contributed by: RDS

Contributed by: Offshore

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