Engineering success

Having undertaken over 8000 projects in more than 100 countries worldwide, Penspen has tackled almost every conceivable challenge in a range of technical and geographical areas.

Penspen is a leading independent group of companies providing studies, engineering, operations, integrity and maintenance to the oil and gas industry for pipelines, production, and transportation and storage facilities both onshore and offshore. The Group provides specialist services on an individual or integrated basis, drawing on its 56 years of experience.

Marketing manager Sabrina Bagarella elaborates on Penspen’s activities: “Penspen’s success is based on technical leadership, its reputation, strong emphasis on staff training and a comprehensive technical offering to clients. We were formed in 1954 by Ken Spencer, who was also a founding member of the British Pipeline Industries Guild. Our long track record, coupled with the fact that we don’t have any ownership ties with suppliers or contractors, is our strength and we aim to provide clients the best possible independent service.”

Discussing how Penspen has developed, Sabrina comments: “In the last five years the Group has grown 400 per cent, mostly through organic growth aided by strategic acquisitions. Traditionally we have been a pipeline and facilities engineering company but we have expanded to undertake operations and maintenance services. In 2005 we acquired an American company called GreyStar and a few years later we bought a Welsh company called ProGas. We already had a division in that field called Unipen. All these together are now a significant business unit.”

Indeed, GreyStar’s presence in the Group was the catalyst for establishing Penspen’s Asset Management Services business, along with Penspen’s existing integrity business centred in Newcastle, the UK, and its existing operations and maintenance business in the country. The subsequent purchase of ProGas, based in South Wales, in 2008 further developed this business area and the synergies within this part of the Group have started to generate significant benefits, particularly in the UK and Mexico.

Penspen works for international oil and gas companies like BP and Shell, as well as national oil companies, which are increasingly important due to their role as owners of the oil and gas resources. The Group sees the value in having regional offices and runs 15 around the world. Sabrina reveals Penspen’s approach to projects: “We cover the whole spectrum of the lifecycle of a project, meaning that we’re involved from the beginning, with conceptual and feasibility studies, to the very last stages including activities such as maintenance and defect assessments. This leads to involvement with a huge variety of clients, such as international development banks, contractors, operators, consultancies and governments.”

Penspen’s in-depth involvement with clients and its ability to match its offering to specific requests help set it apart in the marketplace. “We try to be flexible enough to tailor our services for each client,” Sabrina confirms. “We have 1600 employees, so we are medium sized and this allows us to accommodate our clients’ requirements. We have to work closely with them.”

Another of Penspen’s standout qualities is its commitment to educating its workforce and also contributing to the training of engineers in the wider oil and gas industry. The Group provides specialist training services and professional development services – oil and gas basics, history of pipelines, pipeline basics, monitor and surveillance risk assessment, and routing and hydraulics. “We are very well known as pipeline experts, so we offer a great deal of training, which is important because there is a shortage of resources in the industry and in the UK specifically,” Sabrina explains. “Lead by our technical director, Professor Phil Hopkins, Penspen has contributed to, and continues to support Newcastle University’s MSc in Pipeline Engineering. Several Penspen employees come from that course. We are convinced that the co-operation between industry and university is essential to develop highly qualified professionals.”

The Group has experienced growth in several regions and worked on flagship projects in a cross section of geographical locations. The Nabucco Gas Pipeline project is one such venture, and involves a dedicated gas transit and transportation pipeline spanning in excess of 2840km, from Turkey to Austria via Bulgaria, Romania and Hungary. Penspen was appointed in December 2007 as owner’s engineer for the development and the project is worth five billion euros.

Speaking about more of the Group’s undertakings, Sabrina says: “We have a significant project for PEMEX in Mexico. We are one of the few British companies that have important business in the Americas, a region that has historically been ground for US companies. The specialist skills we possess in integrity, operations and maintenance, apart from our reputation as a Group, have secured us this very important contract there.

“The Abu Dhabi Crude Oil Pipeline (ADCOP) project is another important job for us and we are working closely together with the main contractor, China Petroleum Engineering and Construction Corporation. The pipeline is currently being built and has strategic relevance for Abu Dhabi. It will transport crude oil from Habshan, the collection centre for the bulk of Abu Dhabi’s onshore crude oil production to a new crude oil storage and export facility in Fujairah. The project comprises a single 48-inch diameter pipeline, main and intermediate pumping stations, main oil terminal and offshore loading facilities.” Penspen’s flagship projects include the feasibility study for the Trans Sahara Gas Pipeline, the Turkmenistan-Afghanistan-Pakistan Gas Pipeline, among many others.

In light of Penspen’s considerable growth over the past years, the Group has been able to celebrate a very prestigious honour. Sabrina explains: “In April 2010 we were awarded the Queens Award for Enterprise in the category of International Trade, which we are very proud about. We are very grateful to our staff and to all of our clients and partners for putting confidence in our company.”

As the UK’s most esteemed awards for business performance, the Queen’s Awards for Enterprise recognise and reward outstanding achievement by UK companies. This is the first time the Group has won the Queen’s Award and it comes in acknowledgment of Penspen’s exports growing by 90 per cent to £75 million over three years. Currently, 70 per cent of sales are exports.

CEO of Penspen David Stanley is pleased with the Group’s efforts, commenting: “Our ability to grow in the way we have and continue to achieve is based on the outstanding performance and quality of work from our personnel. The most significant factor in our success is our reputation and this relies completely on how well our workforce performs. I am enormously proud of what everyone at Penspen has achieved.”

Given the Group’s escalating success, Sabrina is optimistic about Penspen’s future and believes it has the necessary qualities to prosper for another 50 years, and beyond: “There are other sources of energy that have been developed but the world is mostly dependant on oil and gas, so we won’t be short of work in the near future. While market conditions and the price of oil will affect our clients, which of course will affect us, there is plenty of work for the Group for years to come and I expect us to keep growing.

“I hope our high retention level with staff remains while we grow, as some of our employees have worked for us for 25years or more. I envisage our flexibility remaining; we can work in a small study and, at the same time, be handling large multi billion dollar contracts, as we are doing right now in Europe and the Middle East.”

Valuing clients above all else and recognising the need to tailor its services to suit individual needs and objectives, Penspen looks forward to improving its services further and meeting new challenges in the coming years, whilst maintaining its tried and tested adaptable approach.

Services: Engineering and management