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NorSkans Brazilian Roots

-- FROM THE FULL PICTURE MAGAZINE --

NorSkan Offshore combines all of the offshore expertise of operations in the North Sea, with equipment, manpower and expertise from Brazil. The result? Brazil's leading supplier of advanced offshore services. Kongsberg met NorSkan Offshore's President at their Rio headquarters.

NorSkan's offshore vessels include pipe-layers, anchorhandlers and multipurpose ships
NorSkan's offshore vessels include pipe-layers, anchorhandlers and multipurpose ships.

The President of NorSkan Offshore, Hans Falnes Ellingsen, shares a vital anecdote that sheds light on the founding of what is today Brazil's most advanced offshore shipowner.

"Helge Møgster of DOF [the owner of NorSkan Offshore] looked at the offshore market back in 2000 and noticed some striking numbers. At the time, Brazil was producing around a thousand barrels per day; Norway was producing close to 3 million," says Ellingsen. "There were three drilling rigs working in the North Sea, and 28 in Brazil."

A few years later, Norway-based DOF bought a 50 per cent share of Brazil's NorSkan Offshore, and has since built the company up into a USD 1 billion operation. All of the company's advanced offshore vessels (including pipe-layers, anchorhandlers and multipurpose ships) are equipped with Kongsberg dynamic positioning, automation and control systems.

Brazilian roots

The Full Picture magazine met Ellingsen at Norskan's offices Rio offices in Brazil. Ellingsen has a long personal relationship with Brazil. He first came to the country only one and a half years old. His family returned to Norway only two years later, but his older sister and brother never let him forget the times in Rio. As he grew up, Ellingsen nurtured a desire to return. "It became an obsession for me to return to Rio de Janeiro."

His fated return happened when he was 20 years old, as a coincidence. "I took a job on a pipelaying vessel, not knowing they would send me to Rio de Janeiro," he explained. He stayed with the vessel in Rio for two years and then returned home to continue studies in order to become a Captain. After becoming a captain, he returned to Rio. "There was always something that brought me here, even if I didn't choose it," Ellingsen commented.

Ellingsen was working for Solstad Offshore in 1996, when the company won its first contract in Brazil with Petrobras. At that time, most Norwegian offshore boats and workers had never been south of the English Channel. In 2000 Solstad had three Norwegian flagged vessels operating in Brazil. "This early experience was very valuable. We learned the ropes on ships worth USD 2.5 million; today, the ships are worth over $250 million. That's what we are investing in each vessel today; it was a learning curve, and although I knew Brazil, there was still a lot to learn in doing business here," said Ellingsen.

In 2002 DOF came into the picture. They had been looking at Brazil for quite some time. The two operated NorSkan Offshore as a joint venture between DOF and Solstad up to 2005 in Brazil and also in Singapore. At the time, the two agreed to split this business geographically. Solstad Offshore, which had first opened up the Brazilian market, left, in order to take over the entire business in Singapore. DOF remained as the sole owner of NorSkan Offshore in Brazil. "DOF is an ambition company and saw the potential for growth in Brazil, especially."

Brazilian operator

Today, DOF has $1 billion invested in Brazil and seventeen vessels in operation, of which seven were built in Brazil. The company has five newbuildings under construction in Brazil and has plans for more. The rest of the fleet is composed of foreign vessels operated by NorSkan.

"All the newbuildings are high-end multipurpose vessels, loaded with high capacity winches and advanced ROVs that can go down to 4,000 meters, the latest mapping and survey equipment. We also have a prototype for installing christmas trees (systems that control oil and gas flow at the subsea well-head). This is a completely new concept that can do the job in half the time a rig takes," said Ellingsen. Traditionally, christmas trees are installed by semi-submersible rigs, which are comparatively slow and expensive.

The NorSkan Offshore vessel arrived in February 2010 for operations in the Santos Basin, and managed to install nine trees in the first month. "This should help open the market for several of these vessels. Because of Tupi and the rest of the pre-salt areas, demand for equipment is tremendous and we have positioned ourselves well. Now we're investing in the most advanced vessels ever built in Brazil. They will be equipped by Brazilian suppliers, built in Brazil and manned by Brazilians. This makes a difference," said Ellingsen.

A social angle to operations

Finding specialized employees in Brazil is a problem that all companies working here face. Ellingsen believes that social programs such as Bola Pra Frente (see the article on Bola Pra Frente on page 20 of this magazine) are one of the solutions for acquiring this manpower.

"We understand that to be a Brazilian company and to be respected as such here in Brazil, we must look outside the company. We need to look at our environment and recognize the needs of this environment," says Ellingsen.

NorSkan Offshore's involvement with Bola Pra Frente started at a fortuitous time. The famous Brazilian football player Jorginho who had founded the project was worried that the kids who didn't have a chance to continue football careers would go back to the street.

Jorginho sought to give these kids training in specialized trades through the program; that is how the partnership began. It started with English classes and this year Bola Pra Frente, with the support of companies such as NorSkan, will train thirty teenagers to work as seafarers through a partnership with CIAGA, the Brazilian merchant marine academy.

Through another partnership with SENAI (a Brazilian trade training institution), NorSkan Offshore is training forty teenagers for positions onshore. "I see that 99 per cent of the kids that have the chance are eager and enthusiastic to study. They want to do this", said Ellingsen.

Together, NorSkan and Kongsberg Maritime are also investing in an apprentice program for the kids from Bola Pra Frente to work in their offices. So far, NorSkan has been able to place five of these apprentices in their offices and eight new seafarers from the program aboard their ships.

"I get emotional when I see these things. We are trying and if everyone tries within their circle of influence, the world will be better, but someone needs to go first and show the way," said Captain Ellingsen, with the emotion vivid in his eyes. He is also happy to announce that the seafarers that show the most potential will be selected to further their education to eventually become officers.

Newbuildings

In the last three years NorSkan closed a variety of contracts. Among them the following ones are to be highlighted:

Skandi Ipanema: An Anchor Handling Tug Supply Vessel with a three-year contract for OGX, with an extension option for one more year. This vessel will be delivered in 2010 and will be the first Brazilian vessel contracted by OGX.

Skandi Santos: A Subsea Equipment Support Vessel with a five year-contract for Petrobras, with an extension option for five more years. This is the first vessel in the world doing offshore testing and installation of christmas trees, the contract is together with Aker Oilfield Services.

Skandi Vitoria: A Pipe Laying Support Vessel with a four-year contract for Petrobras, with extension option of four more years. This is the most advanced offshore vessel built in Brazil, made through a joint venture with Technip. This vessel will operate as a pipe-layer for Petrobras on depths down to at least 2000m.

Company history

NorSkan Offshore Ltda. represents the DOf Group's activity in Brazil. It is the management company for all the group's vessel operations in the region. With more growth anticipated in the region, NorSkan Offshore expects to grow from 330 to 640 employees in 2010. NorSkan has been a supplier to Petrobras since 2003. In 2007 and again in 2008, the company won the General Safety Award for its operations with Petrobras.

NorSkan Offshore was established in Brazil in the year 2000 due to the bright outlook forecast for the Brazilian offshore oil and gas industry. Today NorSkan Offshore and the DOf Group operate one of the largest and most diversified fleets of state-of-theart Brazilian-flagged vessels. The fleet is considered to be the most technologically advanced in the Brazilian offshore industry. furthermore, NorSkan Offshore is the largest Norwegian capital company in its segment in Brazil. The company has long term-contracts with several large customers like Petrobras, Shell, Chevron, British Gas, OGX and Statoil.

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