Keeping wells safe
Launched in 2017 to address the formidable challenge of decommissioning facing the oil and gas sector, Well-Safe Solutions is yet to celebrate its fifth anniversary, due to fall in August 2022. Already, however, the company is providing a groundbreaking approach to the safe and cost-efficient decommissioning of onshore and offshore wells.
“Our vision with Well-Safe was to look at different technical and commercial models that could address the challenge that the industry faces when it comes to well decommissioning,” says Phil Milton, Chief Executive Officer at Well- Safe. “We wanted to build a business that would own and operate its own assets, equipped with its own in-house engineering capability, with the ability to offer both a completely outsourced integrated solution, and the flexibility to adapt to customer requirements.”
The company boasted just a handful of employees at its launch. Together, they guided Well-Safe through a series of investment rounds and the purchase of its first rig, the Well-Safe Guardian, in April 2019. “The Well-Safe Guardian is a Sedco 700 series rig,” Phil explains. “She can operate in water up to depths of 1500 feet, with a personnel onboard capacity of 100 people. We’ve carried out a significant amount of work to enhance her for abandonment operations, including the installation of a saturated dive system and a subsea intervention system. These additions will allow us to re-enter some of the old wells with wellhead fatigue where traditionally the work would be carried out by a light well intervention vessel. By carrying out that work from the Well- Safe Guardian, it not only addresses some of the technical challenges, it creates less risk for our customers and is better for the environment – because we’re mobilizing a single asset, rather than multiple.”
That same year, in October 2019, Well- Safe received a £66m investment from MWL, before purchasing its second rig, the Well-Safe Protector, in September 2020. “The Well-Safe Protector is a harsh environment, heavy duty jackup,” Phil says. “Built in 1993, she worked for a significant amount of time in the Northern North Sea, carrying out long-term projects for Equinor. We reactivated and refurbished her, and she’s now complete and ready to go out to work.”
Well-Safe’s specialism lies in the plugging and abandonment of oil and gas wells. In this regard, it’s not alone – many organizations have run similar operations for a number of years, but only Well-Safe offers a complete solution, encompassing everything from well engineering, project management, rig provision and all associated services. In September 2021, the company won the first fully integrated well decommissioning contract of its kind, a multimillion-pound agreement with UK-based oil and gas firm Repsol Sinopec. “The Well-Safe Guardian is currently on location, managing all aspects of a project on behalf of Repsol Sinopec,” Phil resumes. “The standby vessels, the supply vessels, the rig division, the anchor handling for moving the rig, all the engineering work, all the services required to complete the well abandonment, and all of the services in terms of the contracts are managed by Well-Safe. We also do all the logistics, helicopter management, waste stream management, financial control and general delivery of pretty much every aspect.
“Alternatively, we can do the earlier stage Front End Engineering Design (FEED) projects, looking at a well or field and assessing how you might go about the decommissioning of the field to comply with regional or company- specific guidelines or standards,” Phil continues. “That covers every aspect of planning for well decommissioning, right up to actually completing the project and undertaking the associated seabed clearance. We also manage a number of other assets on behalf of our customers, including a project with DNO’s Ketch and Schooner Developments involving a third-party rig. Again, we’re managing the planning and delivery of the well abandonment operations on DNOs behalf.”
Well-Safe’s contract with Repsol Sinopec was followed shortly after, in October 2021, with its second contract: the decommissioning of up to 14 wells on the Banff and Kyle fields on the United Kingdom Continental Shelf (UKCS). “We’ll be heading out to start that project in Q2 of this year,” Phil notes. “Thanks to the schedule flexibility given to us by Repsol Sinopec, we’ll be able to deliver this project as part of that overall schedule, returning to Repsol Sinopec before the end of the year. Managing that flexibility in well decommissioning is essential as we look to realize our efficiencies and deliver our projects on schedule. Our work on the Banff and Kyle project is not a fully outsourced, fully integrated solution, but it demonstrates our flexibility to address the different requirements of our customers. In this case, CNR will manage the majority of the well engineering and project management internally, with the rig provision and some other services coming from Well-Safe and our supply chain partners. It’s proof that we’re a solution-based organization, and those solutions can take many guises.”
Despite its success, the company wasn’t unscathed by the Covid-19 pandemic. “When things kicked off in March 2020, it had a huge impact on both our business and the industry in general,” Phil notes. “Some of the projects we were working on were suspended, tenders were withdrawn, and we had to manage the effect of changes in the price of commodities. We also went through some familiar challenges, such as a shift to remote working, with large parts of the office closed for much of 2020 and 2021. During that time, we benefited from being a relatively new business, with very up-to-date IT systems that made for a relatively seamless transition. With each wave of Covid-19, particularly the recent emergence of Omicron, we’ve had to adapt. But in general, we’ve seen things slowly improve during 2021, with a return to work on a number of projects we were delivering.”
To execute its strategy, Well-Safe is fortunate to be able to draw on a wealth of industry expertise. “We have employed people from oil and gas operators, from the drilling supply chain, and also the services sector, so we have a really wide breadth of experience and knowledge from those different areas of the industry,” Phil says. “Our current headcount has just reached 200 employees, not including the contractors that work for us on various projects. We recently employed 99 people in 2021, and we’re anticipating another 60-to- 70 in 2022. That’s split across our offshore team to manage the assets, and a broad range of expertise in our onshore team, including increasing our newly introduced subsurface specialist team headed up by Mark Davidson who recently joined us from Shell. Although we don’t class ourselves as a drilling company and we don’t do any exploration or development ourselves, we do own and operate a lot of drilling equipment, so we need to be set up with the necessary expertise to support our project delivery.”
Well-Safe expects its recruitment drive to continue. “We’re a new company, doing things slightly differently,” Phil argues. “It’s quite an exciting time to join the business. Because our work centers around well decommissioning, we also fit neatly within the energy transition. As a result, we’re seeing more interest as focus and attention develops around sustainability and the need to preserve the environment.”
The company’s green credentials are particularly relevant as it looks to target a younger demographic of employee. “Particularly among younger ages, there remains a lack of awareness about the opportunities that exist, and the nature of work that’s available,” Phil comments. “There remains a lasting impression that it’s still all about oil and gas exploration. Our HR Manager, Anita Martin, is a board member of the north-east of Scotland chapter of Developing the Young Workforce; an organization dedicated to preparing young people for the world of work. Thanks to her work, we’ve conducted a series of school visits to build that awareness, and we’ve found that it’s created a real buzz among parents and kids who have since enquired with us about future opportunities. We remain focused on attracting that potential, supplementing our existing expertise with modern apprentice and graduate positions.”
With the Well-Safe Guardian already hard at work, Well-Safe is working to get the Well- Safe Protector out on her maiden scope later this year. “We have a number of different opportunities, so we’re extremely hopeful that will happen,” Phil tells us. “As we move towards Net Zero in the UK, some of the older fields will no longer remain economically viable, and we expect that to accelerate the demand for decommissioning. Then, the goal is about continuing to secure a backlog for both our assets, growing our client base in the UK, and widening our well-engineering capability. To do that, of course, we’ll be looking at acquiring and deploying further assets as we continue to grow.”
Not all of the focus is on the UK, however. “We’re also very active in the international market, and although we’re not delivering operations at this time, we are looking at Asia- Pacific particularly as a region of burgeoning demand for our services,” Phil concludes. “There are a number of wells that are shutting, either for economic or integrity purposes, and are ready to be decommissioned. In Australia, for instance, there are a number of projects currently in the early stage of planning, which we expect to move towards execution within the next five years. In Thailand, we’re seeing that activity already underway. We believe we’re in a very favorable position moving forward.”
Services: Oil rig decommissioning