Slow and steady does not win all races. When Usain Bolt won Olympic gold in both the 100 and 200 metre sprints for an unprecedented third consecutive Games in 2016, it was the result of an entire existence built around speed and fastidious attention to detail and fine margins.
For early production facilities (EPFs), speed is just as much a raison d’être - every day of delayed production erodes profit and undermines the investment. If a typical EPF can boast production of 10,000 barrels per day of oil, then a week’s delay could easily equate to $600,000 of deferred revenue at $60 per barrel. A month could defer more than $2.4mn while incurring significant operational costs.
What’s more, EPFs are having their moment. Their sweet-spot is somewhere in the $50-$65 per barrel range. At this price-point, they are economic enough to attract the industry’s attention, but any higher and they begin to lose it to the big industry projects as they become profitable again. Of course, confidence plays a role too - the industry has to be confident of a sustained oil price before it launches wholeheartedly into megaprojects - but it’s hard to escape the conclusion that EPFs are enjoying their time in the sun, making it all the more important to press the advantage and maximise revenue while possible.
Like Bolt, theirs is an existence built around speed and like him, success hinges on obsessive attention to the smallest details. EPF operators are resourceful and adaptable, but even a small mistake along the supply chain can derail and delay a project at great cost. The race to first oil requires serious investment, backed by experience and expertise in every single facet of the project. Take for example, valves.
The additional edge
In Beijing, Bolt famously devoured 1,000 chicken nuggets in ten days to fuel his triple gold. His supreme biomechanical advantages allowed him to do so while still topping the podium. But to maintain his dominance in London and Rio, he had to adjust, shifting to a healthier diet high in protein and vegetables to eke out every possible advantage.
The lesson for EPFs is that speed requires continuous improvement and investment. While some projects might be profitable with relatively little effort, others will demand every possible marginal gain.
Valves make up a relatively small portion of an overall project, but demand exactly this kind of close attention. If they’re wrong or late, the whole project can be held up while the right components are procured.
On the one hand, the need for speed would suggest buying off-the-shelf, ready to ship valves wherever possible. However, on the other, it’s crucial to get it right first time. Even if it’s a case of 90% stock to 10% tailored valves, the ability to get both quickly and reliably is a small detail that the success of the entire project depends on.
Experience and expertise
Just as Bolt gained experience from every race on the gradual path to his records, for operators and suppliers in the EPF space, each project is a learning opportunity.
Developers have become extremely adept at deploying a modular, quick-start design approach to EPFs, allowing them to minimise time to first oil. They have also demonstrated a flexibility and openness to ongoing improvement that is difficult to achieve in larger projects.