Delays are a constant threat to profitable project execution, and enough delays can derail a project completely. Project delays clearly pose a serious risk, particularly for construction yards.

Launched in February 2009, DNV’s investigation into the causes of offshore newbuild project delays was conceived to identify leading causes for these delays and offer recommendations for avoiding them.

The study was coordinated by a five-person DNV team that met with a number of yard managers, owners, and manufacturers and collected data from DNV’s international network of personnel with experience in offshore newbuilding.

Offshore, not shipping

The team concluded that most offshore newbuild project delays are not related to hull deliveries but are related instead to the commissioning process. In fact, DNV’s research suggests that many yards fail to adequately acknowledge and plan for the differences between ship building projects and the construction of offshore units.

In shipping newbuilds, vessels are relatively simple in design, and they are generally equipped with proven onboard systems that are easy to install; the vendor supplies the equipment, the yard installs it, and the commissioning (usually) proceeds without significant delay.

By contrast, systems installed on offshore projects are often supplied by multiple vendors, leaving the yard to manage systems integration — a process that can have a significant negative impact on normal work flows.

Often, detailed certification requirements are left out at the initial stage, requiring purchase orders to be placed during the installation process. Such planning errors result in additional testing and verification processes during commissioning, which can lead to delays.

Furthermore, many yards lack the technical and organizational experience to manage the commissioning of complex, often unique systems. Yard personnel are frequently unfamiliar with the highly specialized nature of offshore suppliers, a situation that results in failure to complete the work on time.

The commissioning process is further complicated by incompatible software and/or electrical systems, which require the yard to work together with multiple suppliers that may have different ideas about how these systems should be integrated. Managing the twin challenges of system compatibility and multi-organizational communication is a very sophisticated and complex task, one that is often underestimated by all stakeholders involved.

Because commissioning takes place at the final stage of the newbuild project, the process often exposes system anomalies, uncompleted tasks, and inadequate testing that should have been managed during installation.

DNV has identified five critical success factors in the commissioning process:
• Systems to ensure a smooth transition from the newbuild process to integration and commissioning;
• A detailed planning and commissioning strategy;
• A focused and multidisciplinary approach to complex integrated systems;
• High-quality personnel with extensive experience with systems and the commissioning process; and
• Strong and detailed procedural development such as specific test procedures in line with the appropriate acceptance criteria.

The DNV study determined that in many cases, systems were not mechanically complete before being offered for commissioning. As a result, yards have been forced to test and re-test different systems individually and then test the entire unit as one integrated system.

The study also revealed that system shut-down functions are often poorly defined, resulting in complex and time-consuming design queries.
Finally, the study concluded that a lack of clear guidelines to manage cause and effect testing resulted in avoidable delays.

The critical path

Another significant challenge yards face during the commissioning process is determining the “critical path” or optimal procedures to ensure a smooth commissioning process.

Yard personnel fail to ask critical questions such as which system should be completed before the testing of related systems can commence or
what order of systems tests reduces the likelihood that tests must be repeated several times. Establishing and maintaining the optimal commissioning and test sequence with a well-defined strategy can help reduce the risk of delays.

To secure the best critical path, it is vital that the process is managed by a dedicated team that comprises representatives from the yard, owner, and vendor, rather than ad hoc systems integrators for each process. Prior to managing the commissioning process, the project team should work together to achieve the optimal development, design, and commissioning procedures. Having a strong commissioning procedure in place — one that details the relevant tests together with relevant acceptance criteria — enables efficient final testing, thus avoiding delays for subsequent tests.

Drilling units

On drilling unit newbuilds, common problems range from late deliveries of equipment to the failure of vendors to ensure a timely involvement of a class society in the certification process. Late deliveries often require that work on equipment continues in transit, which often results in significant costs related to off-hire time.

Likewise, vendors that are slow to consult with class societies installing equipment without the proper certification, which leads to the yard receiving additional Design Approval comments. Worse, incomplete Design Verification and Product Certifications can delay the issuance of the appropriate drill notations, resulting in unwanted scrutiny from the charterer and/or the shelf state.

Knowledge transfer

For owners, it is important that the individual responsible for the design and review of systems takes part in developing the critical path and is directly involved in the commissioning process.

DNV recommends that once the owner’s engineering manager develops procedures and specifications and reviews the design with the yard, the same engineer should then take an active role in the commissioning process. This ensures sound and good knowledge transfer throughout the project.

From the yard’s perspective, DNV recommends that a dedicated engineer be tasked with three responsibilities: managing the integration process, verifying that the critical path is followed, and ensuring that systems are mechanically operational prior to the commissioning process commencing.

As always, having the right personnel with the operational experience capable of running commissioning programs on behalf of the yard is critical.

To run smoothly, strong leadership and good communication are needed from both the yard and the owner. Project teams should maintain direct involvement from the beginning of the build through to commissioning to ensure a consistent and methodical work flow and to ease multi-organizational communication. In addition, quality assurance personnel should be involved at an early stage to assist in controlling quality duties and risks.

DNV presented these findings to yards and owner site teams in Korea and Singapore and to the DNV Rig Owners committee in Houston last year. Further presentations will take place in 2010, beginning with yard owners and manufacturers in China.

At present, DNV is developing best practices and classification and statutory requirements for commissioning activities to help the industry avoid delays. These internal instructions and the recommended practice are scheduled to be released in April 2010.

This flow chart shows a typical example of a DNV offshore newbuild commissioning critical path. DNV will release Recommended Practices for commissioning in April 2010. (Image courtesy of DNV)

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