The importance of risk management in energy transition

Energy transition is arguably both the biggest opportunity and challenge faced by the oil and gas sector in recent times.

With legislative commitment around reducing carbon emissions, ESG requirements and maturing fields, there is increasing pressure for change. However, businesses across the industry are already taking the opportunity to transfer their expertise from traditional sectors to contribute to the refreshed renewable energy mix.

But as any offshore service provider will know, the sector comes with specific risks – and moving into a new area of business means the threat from operational risk can be increased.

As a result, how companies manage that risk, both from a profitability, reputational and responsibility standpoint, is critical.

MatthewsDaniel, a global leader in specialist services for the marine and energy industries and their insurers, works with customers across the world to help manage risk in traditional oil and gas, while also working with companies as they transition to a broader energy mix.

MatthewsDaniel is perhaps best known for its expertise working with clients in post-risk events – such as loss adjusting – but also supports customers in pre-risk situations, with services such as Marine Warranty Surveys (MWS), risk surveys and wider proactive risk reduction services.

Simon Ward, Director and Chief of Staff at MatthewsDaniel, said: “The global demand for energy is only going to increase, and the need for reliable, increasingly green supplies, will continue to grow.

“As a global community, we are all committed to the transition to a cleaner supply in order to meet the ambitions set out in the COP26 agreement, limiting global temperature rises to within 1.5 degrees C, and to do this we need to utilise the expertise that exists in the traditional oil and gas sector as we transition to this new broader energy mix.

“We work with our clients to support them on this journey, helping limit their potential exposure due to unforeseen risk as they transition to new areas, whether that’s decommissioning existing oil and gas infrastructure or moving into the construction and operation of new renewable energy projects.”

Decommissioning activity is continuing to increase in mature fields such as the UKCS. In these fields, where there are vast amounts of existing infrastructure, there can be a real risk of damaging not only visible assets, but also remaining subsea infrastructure as work is carried out to safely remove and dispose of assets that are decades old and weigh up to 25,000 tonnes.

However, with proper support and project management, clients working with MatthewsDaniel can help protect themselves from potential insurance claims.

Simon added: “The earlier we can engage with clients, the greater benefit we can add to their project. For instance, we can make recommendations for engineering or operational procedures, vessel types, vessel routing or plan changes earlier that could avoid potential challenges and unforeseen costs.”

Beyond decommissioning, the broader offshore renewables sector – including carbon capture and storage (CCS), fixed and floating wind turbines and wave power – offers even more opportunity for skills transference where there is some alignment in activity. Whilst this also has its own challenges that oil and gas companies will need to face, there are a lot of readily transferrable skills and experience from the traditional offshore sector that are equally applicable in renewable energy.

For example, MatthewsDaniel has recently been awarded a project to support the development of a new offshore CCS project in the Netherlands, where it will support its customer with warranties around the pipeline installation, the integration of the pipeline into an existing platform and boat landings on the platform. This utilises the company’s decades of experience as a Marine Warranty Survey provider on a new type of project that is enabled by tried and tested offshore construction methods.

MatthewsDaniel has an unsurpassed global reputation and is a trusted partner the world over with recent project successes in Europe, the Middle East, Asia, Bangladesh and Russia and a host of industry firsts under its belt.

Just one of these was the support provided as MWS on the first tension leg platform (TLP) in the Gulf of Mexico, where MatthewsDaniel provided services from a technical engineering review of the full project scope and suitability surveys of all marine assets to transport and discharge of the TLP hull from Asian to Gulf of Mexico fabricators and it’s tow and installation to site, including the mooring and suction piles installation and hook-up.

MatthewsDaniel has recently strengthened its commitment to the UKCS, and its North Sea clients in particular, with the opening of its new office in Aberdeen.

This will allow MatthewsDaniel, which is a Bureau Veritas Group company, to enhance its offering to clients in the region, providing them with the rapid solutions they need while many are working to navigate the energy transition and manage the associated risks.

While involvement with MatthewsDaniel can be mandated to energy companies as part of the insurance requirements of their project, the company has many clients who proactively  engage without any mandated requirement as they see the value of independent experience and input as this will ultimately help them deliver a successful outcome and reduce the risk of unforeseen costs arising, impacting their budget.

Simon added: “The cost pressures on the energy industry are a continuing challenge and we always want to work in partnership with our clients to make recommendations and support them in offsetting additional pressures to both their budgets and reputations through our risk assessment services.

“We want to make it as easy and as fast as possible for them to get that support and that’s why we have made the commitment to our office in Aberdeen giving immediate local access to our expertise for operators in that area.

“The excitement around the opportunity and challenge of the energy transition is something MatthewsDaniel is prepared for, and we look forward to supporting our clients as they move into this new phase in their businesses.”

Operating since 1962, MatthewsDaniel’s experts are world-renowned in conducting specialist technical reviews both onshore and offshore for critical project phases and activities, employing a well-researched and quality-assured approach to identify and advise on measures to mitigate and minimise risk.

For more information, visit www.matdan.com

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