Posted on Saturday 14 December 2013 by Ulster Business

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Belfast will have a Christmas tree with a difference lighting up its skyline this year as the Blackford Dolphin oil rig is refurbished by Harland & Wolff Heavy Industries.

The gigantic offshore exploration and drilling platform is undergoing a two month refit after international oil group Dolphin Drilling appointed the iconic Northern Ireland engineering firm to undertake what could be a pivotal contract.

The deal – worth "tens of millions of pounds" – is the latest in a series of projects Harland & Wolff has undertaken in the lucrative oil and gas sector and if completed successfully, management believe it could open the door to more high profile contracts.

Aberdeen-based Dolphin Drilling awarded Harland and Wolff the contract for the dry docking of the Blackford Dolphin – nicknamed The Beast – earlier this year.

The Aker H-3 propulsion assisted semi-submersible rig underwent a major deep-water upgrade in 2006 to 2008, at which time, H&W designed and built its 130 man accommodation blocks, power generation modules, mud room and additional buoyancy units.

H&W won the latest project over other well established international players after proving its mettle with some other high profile refits.

Those included the dry docking and service of the 272-metre long, 46 metre wide SeaRose Floating Production Storage and Offloading vessel for Canadian company Husky Oil, which needed the ship back in operation at the White Rose oil field off the Newfoundland coast within a tight time frame.

Head of Sales & Marketing David McVeigh (pictured) said its work on the Sea Rose "made a big noise" and gave the company major credibility in the market.

The ship is, he says, the "crown jewel" of Husky energy's fleet and the job had to be in completed on time. In fact it came in a few days early and as a result H&W is now talking to Husky about other projects which may previously have gone to bigger companies.

"Delivering that project in the way we did was the game changer for us in this market, not just because of what we were able to do but because of what everyone else wasn't able to do," said McVeigh.

"Most projects like this in Europe in the last five years have been late and ended up in court. This was the only one that was on time, it came in under budget and we had no injuries."

The job has opened doors beyond Husky, who introduced H&W to other key contacts in Canada, and the market is now looking at H&W as a serious player. That includes Dolphin, whose fleet H&W had previously refitted in the 1990s but who had gone elsewhere in intervening years. McVeigh is confident the Blackford Dolphin job will yield more work from them and others.

"If we succeed with the rig coming in there are three or four even bigger jobs next year which we are up for grabs," he said.

WEIGHT OF HISTORY

Few companies are so closely tied to a region's history as Harland & Wolff.

Many people will have parents and grandparents who worked there and as the firm which built Titanic, the most famous ship of them all, it remains a big part of the tourism story being told a stone's throw away in what is now known as Titanic Quarter.

Such was the scale of its economic contribution and the sadness that accompanied its decline in the 70s, 80s and 90s that the company's every move is – somewhat unfairly – viewed through a historical lens.

In its heyday Harland & Wolff employed thousands in its shipyards. The numbers fell as low as 93 as shipbuilding in the UK and Ireland declined, before things began to turn around after the company embarked on a major diversification strategy eight years ago.

Now a subsidiary of Norway-based Fred Olsen Energy ASA, the current management are working hard to make a force for the 21st century as a multi-disciplinary advanced engineering firm.

The company refocused on four main areas of activity: ship-building, repair and conversion; design engineering; renewable energy generating technology; and steel fabrication and installation.

Today H&W's core workforce is just shy of 200, with other workers on short term contracts meaning around 600 are currently on site. McVeigh says H&W is "growing cautiously" and adding about 20 new staff every half a year.

McVeigh doesn't refer to the last ship to be newly built at H&W, he refers to the "most recent" – a roll-on roll-off ferry called Anvil Point, which launched in 2003. But he says the economics of shipbuilding don't stack up in Belfast any more, and the management are unlikely to gamble the company's future on "vanity projects".

That's not to say the firm's traditional ship building skills are not in demand in the repair and conversion sector. Its second dock is busy all year round with up to 70 vessels coming in for work, including the entire Irish Ferries fleet and vessels from Stena Line and P&O.

H&W has also put those skills to use in the renewable energy sector, which has yielded a series of big contracts over the last six years.

Large projects it has completed include the manufacture of revolutionary new steel foundations for two offshore meteorological masts to be installed on the Dogger bank offshore wind farm site in the North Sea; completion of 30 offshore win turbines installed off the Cumbrian coast in the Irish Seal; and a 60-turbine wind farm now installed off the west coast of Scotland.

While it is still getting interesting renewables contracts – including offshore substations and floating platforms for offshore wind turbines – McVeigh says the renewables market has cooled and with those projects having a long lead time, it will take a while to heat up again.

That makes H&W's shift of focus to oil and gas all the more important. A steady flow of commissions to build large-scale accommodation, transformer and power generation modules for the offshore oil industry has complemented other design engineering projects. Current contracts include making innovative foundations and piling jackets for major oil platforms.

H&W's most recent financial results showed turnover of £42m and profit of £3.6m. The profit line could, says McVeigh, be higher but H&W is putting a lot of investment back into the company to ensure it has the capabilities to provide a quality product – with around £10m of capital spend last year including new paint halls with renewable roofs for the oil rig work.

McVeigh describes the 60 day job on Blackford Dolphin as a "light job" compared to the full refit in 2006, but the class of client and size of the platform make it significant.

EMPLOYMENT BOOST

The 360ft high Blackford Dolphin platform is too big to fit beneath H&W's iconic gantry cranes Samson and Goliath, meaning Samson (the seaward crane) will be moved on its tracks to the city end of the building dock for the duration of the refurbishment contract.

While taxi drivers might tell tourists they aren't used any more, Samson and Goliath – now their official names on insurance documents – are in fact fully functional and in regular use.

If they were not paying for themselves they would quickly become unaffordable to keep, with McVeigh noting similar gantry cranes in a shipyard in Malmo were sold for one kroner to avoid the cost of maintenance.

The cranes are not on mains power and move on two diesel engines with the equivalent horsepower of two Bugati Veyrons (though a little more slowly). It is 120 metres to the top of Samson (over 450 steps), which is slightly taller than Goliath, and should they ever go out of use the panoramic views of Belfast would make them an amazing tourism attraction.

For now, the Dolphin Drilling rig is being worked on in H&W's main building dock, which at 556 metres by 93 metres and 12 metres deep is one of the largest in the world.

With the rig going straight to a North Sea drilling contract, H&W has brought in 600 temporary workers to complete the renewal, upgrade and maintenance work on time.

About 200 will be hired from the local labour pool, while a further 200 will be drawn from Scotland and the north east of England, and the rest from European countries such as Poland, Portugal and Lithuania because there are no longer enough skilled steelworkers and welders left in Northern Ireland to fill the full complement following the decline of the ship building industry.

"These are wages that can support families. These are highly skilled people, highly trained people who will be contract in for a minimum of 60 hours a week. We have to give the guys the hours to get them to come," said McVeigh.

He notes that the skills pool for traditional skilled manufacturing roles such as steelworkers, welders and electricians "isn't what it used to be" but says the quality of welding done by H&W's staff is "as good as anywhere in the world" because its rig foundations, platforms and ships are all built to go in or under the water.

If all goes according to plan, we'll have to get used to many more of these colossal structures making their way up Belfast Lough.

The contracts it is likely to tender for next year could be much bigger than the Blackford Dolphin refit as many rigs have not been refitted for 10 to 15 years. That, H&W hopes, will bring far more jobs to Northern Ireland.

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