Overcoming technical, strategic and operational challenges of operating vessels in the Arctic.

Unlocking the Arctic: Upstream operational risk, safety and collaboration

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The Arctic is a vast area which can have very different operating conditions. While some areas have icy conditions all year round, others are covered by ice only in the winter, and ice thickness will be very different from place to place.

Operational, research and technical skills are key to successful operations in the region.

From Ordinary Seaman to Owner of HARNVIG Arctic & Maritime, we spoke with Klaus Harnvig Krane, about the considerations on operational risk, safety and collaboration in the Arctic.

RISKS & MITIGATION

We asked Klaus to explain the risks of exploration and operation in the Arctic.

“It's a big question as the risks are very much related to the area and the time of the year.

“How's the weather? How's the ice – is it heavy, are there icebergs, and are there growlers? How's the light? How's the darkness? How cold is it, or how warm is it? Temperature, light, ice and weather conditions, are all part of the risk factors you will have to investigate.

“Asking yourself these questions should be one of the first tasks when planning your operation and building your risk profile. For example, you have Southern Greenland which is in the Arctic. You have hardly any ice there, but you have horrible weather most of the year. Then you have North-East Greenland, where you have icy conditions all year round but in summertime the weather is gorgeous – there is no wind and 24 hours of sunshine.

“You would need to start with 2D seismic surveys, which can be a challenge itself. Then you move on to 3D seismic surveys and bottom sampling, which can be particularly challenging in ice-covered waters. Then you do the electro-magnetic measurement, which can be done from an aircraft.”

These are some of the things you will need to take into consideration when you are determining the risk profile of an operation.

“I was engaged in a Kara Sea drilling operation where we expected to have quite a long ice-free period but small icebergs and growlers which needed to be taken care of. We created a setup to keep the drill rig free from any drifting glacial ice.“

While the above factors were key in determining the risk profile of an operation, Klaus also mentioned the importance of equipment and the distance of the journey as important factors

“In many cases, you can design new for operations. At the moment we don't really have drilling rigs that can handle ice impact, but you can build a drill ship which can take impact from small icebergs. “Then you don't have to have ice management, you don't have to have four icebreakers to tow away the icebergs and makes life much easier.

“This is another important consideration when planning your operation - can you design the equipment to withstand the impact from the ice and the weather.”

Distance can be one of the most challenging factors in the Arctic. The supply distance can be very long and can give some challenging conditions for an entire operation.

“When people ask me, what do you think is necessary compared to a normal drilling operation in the North Sea, one of the issues is the distances, evacuation, and the amount of support that you can get. For example, North of Greenland compared to the North Sea is very challenging.

“In the North Sea you have 45 vessels within the vicinity. You have a rescue setup, helicopters from the surrounding countries, and you will probably have a large number of supply boats. Within a couple of hours, you will have 2-3 tugboats or supply boats which are able to assist and start rescue operations.

“You don't have that in the high Arctic. You need to think about that, you need to have your own gear, you need to be able to handle situations on your own, and not counting on too much help from the outside. In a worst-case scenario where you have to evacuate the entire rig, where will they evacuate to?

“You need to have those vessels on standby and have plans in place. You may not have 12 hours sailing to the nearest hospital where you can take 60 people. You may have 4-5 days of sailing without any helicopter support. These are the challenges you may need to handle, but again, so much depends on the time of the year.

“If you are planning a year-long operation then it starts to be quite complicated. You will need to have a setup for the summer seasons, a setup for the shoulder seasons, and for the high winter - three completely different conditions to operate in.”

SAFETY & THE POLAR CODE

After the sinking of the MV Explorer in 2007, the pressing need for controls on operations in the polar regions lead to the creation of The Polar Code by the IMO.

The Polar Code lists mandatory measures and recommended provisions for operators in the waters surrounding the two poles. These are in place for safety and to prevent pollution.

In a region as unforgiving as the Arctic, safety precautions are a must. It is essential that they are a priority to protect crews and all equipment.

“When you design your complete operation, of course you want to have as much up-time as possible. You have to look at means of escape and evacuation to safe areas. That means you have to look into your redundancy and go through the complete hazard identification - all the "what if" scenarios.

“What happens if you have a situation like the cruise vessel (The Viking Sky) we had in Norway recently. Did they do a proper hazard identification? One hundred years ago, you had a worse-case scenario of a sailing vessel - don't ever put your vessel in bad weather with the coast to your lee. You could be trapped, grounded, and have your vessels lost. You do everything you can to avoid that situation, but the other day they put a vessel in that situation. Even though it was a short distance, you must consider what if to do you if you lose all propulsion in that situation. Four miles from the coast in 8-10ms of waves, what will my situation be if I lost all power and all propulsion? Did they do that exercise? I don't think they did.

“Perhaps they thought, “Ok, we're a big vessel we can take it, we've done it before so no problem.” So, they should have asked themselves that question, what can we do if that happens, and is it an acceptable risk? Will we take that risk or will we not? And obviously they thought, "We can take that risk", which they did but I would say they were extremely lucky.

“It could have ended in a disaster. They could have lost the vessel, they could have had 1 000 tonnes of fuel oil on the Norwegian coast and you could have lost a considerable number of lives as well. The Polar Code has a requirement to document all of this - for it to be in the polar operations manual - what do I do if this happens, and is it an acceptable risk?”

The Polar Code entered into force on 1 January 2017. While two years may not be enough to judge the full implications of the code, we asked Klaus whether he believed it was sufficient.

“I will tell you in 100 years when there are no accidents, then maybe it has been sufficient!

“At this point we still need to see how they will be interpreted. We haven't seen a large-scale Arctic operation where the Polar Code is utilised to the full extent. But I think the Polar Code is a very good step forward, it is raising awareness, it is stating that you have to do your operations risk assessment, you have to have a risk model, you have to have monitoring, you have to take you have to figure out what to do in all sorts of various scenarios before you go into the area.

“It's basic common sense in a way (the Polar Code) if you look at it, but global industry is not always driven by common sense. Now operations are required to exercise this common sense, and document that you have used it.”

While Klaus believes The Polar Code is a great step forward, he does have concerns over how it is exercised by operations – specifically with regards to flag states and the class.

“Do they go for the minimum solution? Do they accept a minimum solution? Will they come up with further requirements, or will they say, this is just not good enough? It will take an expert to give a qualified answer to that question.

“My fear is that some flag states will simply just sign it off and say, "Hey, there's a polar water manual, that's fine." It will be skimmed through and they will say, "Ok, it looks good." And there you go. It's a question about everybody in the entire operation being responsible. They must take this equally seriously as a weak link puts safety at stake.

"It's a question about everybody in the entire operation being responsible. They must take this equally seriously as a weak link puts safety at stake."

COSTS VS RISKS VS IMPACT

As with many businesses across any industry, an investor in a venture needs to balance the right solution with acceptable costs.

“There is always a question about balancing the costs because you have a lot of technology available for mitigating all sorts of risks - let’s say you have a 3D seismic campaign in ice-covered waters and you would have a number of ice management boats available which would then be the first means of evacuation. For drilling you would have standby boats, you would have icebreakers in the vicinity.

“With regards to technology, everything you touch in the Arctic is much more expensive than almost anywhere else in the world.

Costs aside, Klaus believes the right solutions in the Arctic will involve a combination of using the right equipment and finding the right time when you have the least environmental impact in your area operation. At present though, he has concerns that many Arctic exploration operations are using non-specification equipment - mainly non-ice classed vessels and drilling rigs.

“They are hardly winterized so what we see is that the operators go in with equipment that is not really suited for Arctic use. They want to keep the costs down because they don't want to have higher costs than anywhere else in the world.

“I think they need to accept that if they want to extract Arctic oil, they will have to accept higher costs. You need to be able to protect the environment better, or you need to at least have better equipment to protect the environment - in the same way that you are protecting it elsewhere.

“We have certain areas in the world where there are more oil field accidents than in others, but you have other areas where you hardly have any accidents at all - like the Norwegian sector for instance. So, it’s crucial how you plan, what equipment you are planning to use and what safety setup is available around you in operation and what do you put in place. All these things have got to be much better in the Arctic.”

COOPERATION & COLLABORATION

With new sea routes opening and the potential of oil and gas discoveries, Russia has been in the process of staking its claim across vast areas of the Arctic. With this Russia first tactic for shipping operations, other players have been left lagging behind. While Klaus believes that Norway and to some extent, Canada, are building knowledge in the area, their Russian counterparts are “building a lot of knowledge through operating in the Arctic.”

EU imposed sanctions on Russia mean that there is little chance for non-Russian operators to collaborate. Recently, the Russian government set out new rules for foreign naval vessels sailing on the Northern Sea Route.

In summary, the foreign state must send a notification about a voyage at least 45 days ahead of its intended start. The notification must include standard information such as the name of the ship, its objective, route and period of sailing. Additional details would also be required, such as the ship’s length, width, dead weight, draft, type of engine power, and the name of the ship’s captain.

One could see this as being excessive, but Klaus had a leveled view on the topic but did foresee challenges.

“The 45 days’ notice, I think is kind of fair. If you want to access this extremely difficult sea route, you need to give us some notice and 45 days is one and a half months. On a long-planned journey or in a fixed-contract for a vessel taking 10 loads of cargo from one port to another using the Northern Sea route, is quite fair.

“In the competitive market its extremely difficult because you may have a vessel somewhere in the China Sea and you get the opportunity to go and load somewhere 8 days from now. Then you have to deliver it Rotterdam (or wherever in Europe) and then you don't have 45 days to notify them.

With that in mind, these rules are not in place to stop vessels or operations from using the Northern Sea Route.

“I think it all boils down to co-operation along the Northern Sea Route. It used to be the Ministry in Moscow who were in charge of that, and now it's with a different organisation. They are really good and efficient, and you can talk to them.

“I think it all boils down to co-operation along the Northern Sea Route. "

“If you have an issue or if you want to ask for dispensation for these 45 days, I'm sure they are open to this. Everybody has to protect their interests, and I think because they want to protect their interests, they have to setup what needs to be in place. They must know when the vessels are there and when they are going, where should the icebreakers be, and so on.

“I think close co-operation with the Northern Sea Route administration is the key to enter the Northern Sea Route, when you are ready to.”

Klaus will deliver a presentation on Ice Management - its definition, best practices, future technologies and developing holistic approaches at the Arctic Oil & Gas Conference taking place 21-22 May 2019 in London.

The event brings together key stakeholders from the oil and gas industry, assessing the challenges and solutions for oil and gas exploration, production and transportation in Arctic and ice-infested regions.

Book your place now.

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