with Asgeir Knutsen, General Manager, General Manager
In 2009, you were appointed as head of EMERSON in Norway, during the global financial crisis, just before the second boom in Norwegian oil and gas, and when Roxar became integrated within the Emerson Group. How have these factors shaped you strategic priorities and management of the company over the last few years?
When I started at EMERSON, it was in the middle of the crisis. The company reviewed its strategy going forward in Norway at that time. Despite the downturn, EMERSON set a goal for 2014 to double its business in Norway. As you mentioned, Roxar came into the picture and was acquired, which meant that EMERSON would have additional strength going into the market. EMERSON then covered not only topside portfolios in the automation branch, where the company is a complete supplier, but also subsea and downhole, thus creating a complete portfolio for subsea, downhole and topside. The acquisition therefore contributed to us becoming a more complete solutions provider.
Did the acquisition of Roxar allow you to double your business as intended?
This goal was intended without Roxar, and was based on the old Emerson portfolio from a few years ago. Acquiring Roxar meant more than doubling the business. Emerson is structured such that each national company takes care of all of its divisions in that country. The acquisition of Roxar was a new division coming into play. While Roxar is still global, EMERSON takes care of the total portfolio in Norway. While there are currently two separate channels, Roxar and Emerson Process Management, the merging process has already started.
Are you looking to integrate operations further in the years ahead?
Emerson has a strategy for operating some years after the acquisition before full integration is really implemented. Integration plans are therefore still in the pipeline.
What value does this partnership bring to technology development?
Cooperation in technology between Roxar and Emerson has already started, and is moving rapidly. For example, Emerson has a leading position in wireless instrumentation, and the company is now ensuring that Roxar’s portfolio is comprised mostly of wireless technology as well. Additionally, most of Roxar’s topside products are adjusted to the Emerson’s technology. In terms of integrated operations, EMERSON is examining ways to integrate Roxar downhole and subsea equipment into the asset management systems the company has as part of its portfolio today.
How do you see EMERSON and its role in contributing to this concept of integrated operations in Norway?
Most or all of the major oil companies have envisioned this as part of their production concept. I see a turning point now where technology is mature enough to let companies achieve the integrated operations model and EMERSON’s products are at the forefront of this technology direction. Until now, integrated operations were mostly used for huge machinery in power generation. This technology can now be used for minor or smaller equipment on platforms and it can be used to communicate the health of the installation to onshore facilities. This is the whole meaning of integrated operations: doing maintenance based on the health of the equipment onshore also monitored from onshore facilities.
What do you see as the main driving factors pushing oil producers to want to integrate this technology?
Offshore cost and safety are the two main drivers. The available technology gives much more rapid warning signals, thus avoiding dangerous situations.
What are the key technologies that have come about recently that allow you to develop the next step for these concepts?
Wireless technology makes it more cost effectiv to measure more points of process equipment. It is very much about communicating intelligent information from the process equipment into databases and making it easy readable for maintenance people. The communication technology from field to operator has improved substantially in Norway, creating a seamless integration of technology from offshore, downhole, subsea and topside to onshore.
Statoil is now driving strongly against more rational operations of their installations. Now they have seen that technology is available and are doing sets of projects to implement it. It is also important to realize that this is about working processes as well as technology. You will not receive the benefit of technology if companies do not change their way of working. This is as big of a hurdle as designing the technology.
What impact do you think you can have on the operations of a company like Statoil?
Depending on what you mean by efficiency, it can be a lot. It is well known that the efficiency or utilization in respect of extracting oil from fields is now around 50 percent on the NCS. In other parts of the world it is 25-30 percent. In one respect that is efficiency. It is also about how many people are needed to run a platform. Of course with new working processes and high technology use, it is possible to be more efficient when it comes to a critical line of safety as well. Companies are aware that efficiency is not all about technology its uses. It is a fine line of balance between enough competent people offshore combined with the use of technology. This is becoming true of smaller companies as well.
E&P companies in Norway have expanded to about 50 operators on the NCS. Do these companies see the same benefits as Statoil?
Companies want to utilize the technology to prevent increasing the size of their organizations more than necessary. Statoil and the bigger players are in a somewhat different position as their organizations are all accustomized to large workforces in their methods of doing operations. Smaller companies can form their organization around newer opportunities when it comes to modern working processes and technology.
What would you say to the traditionalists in the industry who say it is always better to have an expert on the field close to the operation in order to assess what is going on?
Even being a supplier of technology I think it is important for EMERSONsuppliers of technology solutions to also realize the importance of competent people on site. I think there is always a balance between optimizing the use of technology and having experienced people.
How do you see the integrated operations concept shaping the Norwegian production environment over the next five years?
It is clear that it will affect not just the green fields being developed today. I think the concept of equipping and manning of all fields today will be somewhat different compared to the past.
Given that Norway has always been a leader in innovation, how do you view Norway’s importance for EMERSON in terms of developing new concepts and furthering innovation within the company?
I think it has been realized at a very high level in Emerson that Statoil and other companies are setting the pace internationally in new methods of production. The company is paying attention to what is going on in Norway and really adapting technology into that.
What would be your personal ambition for the next three to five years?
Emerson is working at being a solution provider and discussion partner for oil companies to really adapt technology in a balanced way for them to use. My goal is to have EMERSON seen as an honest and good discussion partner for them to realize their ambitions.