Register to download the report. Already a member?

Download PDF

Click Here for $250 / 6 months

Click Here for $450 / year


Jerry Paisley, Regional Manager, Fugro, Singapore

Jerry Paisley, Regional Manager of Asia Pacific for Offshore Geotechnics at Fugro, gives an overview of the company’s South East Asia operations and offers his perspective on the strategic importance of having a presence in Singapore, despite the lack of land space and scarcity of domestic hydrocarbon resources.

How has the company been transformed following the acquisition announcement of Fugro’s Geosciences Division by CGGVeritas? And what do Fugro’s Singaporean operations look like now?

Fugro has been associated with offshore survey, site investigations and engineering and is recognized worldwide as the industry’s technological leader. Fugro has a network of offices throughout the world including the South-East Asia region, enabling us to provide high quality local geotechnical and survey services enhanced by our international support and expertise. For our Singaporean offices, 2013 marks forty years since incorporation and demonstrates our commitment to the country and the region.

Since we divested our Geosciences Division earlier in the year to CGG, we have in essence reverted to being a geotechnical and survey focused company, which has been at the core of our activities for many years. However, as part of the transaction, Fugro did retain a 60 percent ownership in the Seabed Geosolutions joint venture, a specialized seabed node geophysical company.

Needless to say, the divestment has freed up significant amounts of capital for our company and we are currently undergoing a strategic review. Following the announcement of the review in late September, stakeholders will have a clearer picture of Fugro’s business development strategy moving forward. Together with a leading consultancy, we are reviewing our entire operations and where our investments should be directed. These decisions would underpin our commitment to developing our traditional geotechnical and survey business lines.

Considering Singapore’s shortage of geological space and natural resources, what is the strategic importance of your Singaporean operations? How has being based here played to your advantage?

Singapore serves as our regional base of operations. Between the geotechnical and survey businesses, we are operating five vessels from the Singapore hub, covering the entire Association of Southeast Asian Nations (ASEAN) region from as far north as Sakhalin, Russia in the North Pacific, down to New Zealand. Although we have a significant operating presence in locations including Perth, Jakarta, Indonesia and Kuala Lumpur, and Malaysia, among many others, our major marine assets are run from Singapore.

Historically, Singapore was the first place where Fugro was incorporated in the region on the back of the oil and gas industry’s growth in the early 1970s. This move was spurred on by Shell’s mammoth downstream investments in Singapore and production activities in Brunei and Malaysia, who are among our biggest clients locally and globally. Since then, Singapore has remained the operational and financial hub of our regional activities because of its high productivity and conducive business environment. The overall attractiveness of Singapore’s business environment is reflected by the strong presence of a myriad of oil and gas companies both in the Upstream and Downstream sectors.

More specifically, what are your key growth markets you are servicing out of Singapore and simultaneously, what are the most difficult one’s for you to penetrate?

Our activities are broadly categorized into two domains: shallow-water and deep-water markets. For shallow water, our key markets are Thailand, Vietnam, Indonesia and Myanmar. Although Myanmar can be a difficult market to tap into, we are already working within the country and are currently well positioned to leverage the great growth potential it represents. On the other hand, our deep-water markets are more dispersed and include China, Australia, Indonesia, India and Malaysia.

Across all of our markets, Indonesia is proving to be the most difficult to manage from a business point of view. Only fifteen years ago, over 60 percent of our regional turnover would have originated from there. Whereas today, it is probably down to 25 percent. The issue is not limited to Fugro alone since we are seeing many Upstream companies exiting the Indonesia market and fewer entering it due to the lack of transparency, regulatory complexities and challenging business environment. Nevertheless, because of the big projects expected to come online there, we are rather active in the deep-water developments, which is in sharp contrast to the shallow-water markets, which are shrinking and becoming increasingly dominated by the local players.

Given the current trends by upstream offshore companies in the region going into deeper and more remote areas, what are the specific technical challenges of operating in offshore SEA? To what extent are the regional geological characteristics pushing your technical boundaries?

Deepwater remote exploration and field development programs are essentially one of our key areas of expertise. As a key area of expansion for us, we have made significant investments in deep-water equipment and vessels specifically to tackle those frontier areas. These resources enable us to reduce the risks associated with the wells and infrastructure whenever the oil majors venture into those remote expanses.

To what extent do you have to adapt your technologies to suite the environments? Is there any adaptation of the products and technologies you have to provide and use here?

A lot of this is driven by the Macondo incident in the Gulf of Mexico whose impact, in terms of de-risking wells is felt globally. We simply introduce the technology and interpretation techniques, which are identical across our operating markets. Whether we are working for a given client in the Gulf of Mexico or in West Papua in Indonesia, their expectations are the same. Our strength lies in our ability to deliver their expectations within the frameworks of the local regulatory environment.

Having said that, most of our research and development is based in our offices in Houston, USA and Wallingford, UK—all the technologies and innovations they produce are replicated across our entire network. Globally, Fugro owns nine Autonomous Underwater Vehicles (AUV’s), two of which are stationed here. Similarly, Fugro is also pursuing a fleet renewal program in which we have just received a new-build survey vessel in Singapore, the Fugro Equator; 65.6m state-of-the-art multi-purpose DP1 survey vessel. In addition to this, the Singapore office expects to take ownership of a new-build DP2 geotechnical deep-water vessel, the Fugro Voyager, in mid-October. With the upgrading of our regional fleet, we are in fact keeping abreast of European and the Gulf of Mexico regions, demonstrating the confidence we have in the growth potential of our regional market.

Singapore is renowned for its marine and offshore structure building expertise. Considering the fleet investments Fugro is making, what role are Singaporean yards playing in the manufacturing of your assets?

Currently most of the survey and geotechnical vessels are in fact constructed in Europe, Thailand or India, respectively, which are then delivered here for final works. As a fabricator of approximately 70 percent of global offshore rigs and Floating Production, Storage and Offloading vessels (FPSO’s), Singapore is indeed a market leader in that domain. However, not many shipyards do handle the type of specialized vessels we are procuring.

On the other hand, our entire remotely operated underwater vehicle’s (ROV’s) are manufactured and built in Singapore. Globally, our ROV fleet stands at about 150 units and is only second to Oceaneering.

How would you rate the regional competitive environment in your field? And how do you manage the competitor’s threat?

There is certainly a strong competitive environment in the region stemming from regional and international players alike.

For Fugro, we manage this threat by striving to be the best, to meet the expectations of the Oil Majors. Irrespective of the operating location, these multinationals expect a high level of quality and safety standards, which we can deliver throughout our global network. That is why a large proportion of our work is derived from a little over a dozen repeat clients. In addition, because of our extensive historical presence and local geological knowledge, we can also deliver the same solutions to the NOC’s and Independents who are actively engaged in shallow water domestic oil and gas exploration and development.

What do you place a higher premium on: cost‐competitiveness or technological excellence?

For us at Fugro, it is actually a combination of these two. In a given project, it is not always about new technology, but rather carrying out a similar task in a safer and more cost-effective manner.

From a commercial point of view, how does the approach you take with potential clients differ from that of other regions?

We have to be aware and appreciative of the ASEAN regions unique cultural and business practices. We have to understand how to communicate effectively with a client, which in itself may vary widely from country to country given the diversity of the region. That is why it is important to have a local presence. Having been incorporated in Singapore for over 40 years, and in various parts of the region for over three decades, I consider this yet another one of our strengths. This is further supported by our large ASEAN workforce, which helps us understand and navigate the different markets and regulatory frameworks we operate in.

In many ways and industries, Singapore is known for its positioning as a marine and offshore hub, but also as a center for knowledge and innovation. To what extent is Fugro engaging with local stakeholders to develop its capabilities and advance industry knowledge in your field?

The National University of Singapore (NUS) has a Centre for Offshore Research & Engineering (CORE), which carries out a significant amount of research programs. The establishment of CORE in 2003 marked the first step in NUS’ plan to help shape the development of Singapore into a center for offshore and maritime research. Within the few years since its inception, CORE has established strong links with the offshore oil & gas industry, and has established an enviable track record in R&D and education in offshore technology. Some of the high-end research topics taking place there today are mainly centered on the engineering space, as opposed to exploration and production, and ranges from arctic engineering to methane hydrate research.

In that respect, Fugro engages in and funds a number of joint industry projects with various research and academic institutions and industry players. With over 130 jack-up rigs in operation in the Asia Pacific region, we carry out a good deal of survey and geotechnical engineering work to ensure the safety of the sites. Because it constitutes such a large proportion of our work, we are conducting a fair amount of research into improving the prediction and avoidance of jack-up punctures and are actively funding these Joint Industry Projects with NUS.

If we were to meet with Fugro Singapore again in three years’ time, where will you have taken the company?

Over the next five years, I believe we are on track to double the size of our Asia Pacific business. In doing so, we aim to continue focusing on the geographical hotspots like Myanmar, and contribute to the development of the deep-water industry which is still in the early phases in the region. Our commitment to the region is best reflect by the investments we have made in our equipment. The fact that Asia Pacific is receiving the first new-build deep-water geotechnical vessel, as opposed to any other region, is indicatory of the potential we have identified here and is something to be proud of.

To read more interviews and articles on Singapore, and to download the latest free report on the country, click here.



Most Read