Before discussing the degree to which Scottish companies have, or have not, been involved in the delivery of the Seagreen Project it’s probably worth outlining what exactly that project involves. In simple terms Seagreen, when completed, will be Scotland’s largest and deepest offshore wind farm, made up of 114 wind turbines located in the North Sea 27km off the coast of Angus. Once operational, the turbines should provide enough green energy to power more than 1.6 million Scottish homes, displacing more than 2 million tonnes of carbon dioxide currently generated by fossil fuels every year.
Onshore and Offshore Project
The project as a whole has a budget of more than £3bn and is jointly owned by SSE Renewables (49%) and TotalEnergies (51%). In terms of logistics and project management Seagreen is a genuinely huge undertaking. The onshore component of delivery involves – amongst other things - the development and construction of an operational base, the construction of a dedicated substation, the installation of underground cables from landfall at Carnoustie to Tealing, the development of an export cable landfall site at Carnoustie and the development and installation of the required harbour infrastructure.
If anything, the offshore portion of the project is even more demanding, involving challenges which include the manufacture of associated infrastructure, the installation of the turbine foundations, including suction caissons and pin piles, the installation and commissioning of the wind turbines themselves and the laying, connecting and burying of the subsea electrical cables. An overarching demand presented by the Seagreen project as a whole must be the co-ordination of all offshore and onshore activities to make sure that the disparate and individually complex aspects of delivery are managed seamlessly in order to ensure that – as planned – the first power generated by Seagreen will arrive in early 2022.
Manufacturing Location Controversy
As a rule, large scale renewable energy projects tend to be controversial, although one which is located 27km out to sea in a part of the UK used to dealing with the presence of oil and gas platforms could perhaps expect to be waved through somewhat more enthusiastically than most. As it transpired, there has been a degree of controversy attached to the Seagreen project, but it has centred not upon the existence or location of the turbines, but rather the fact that they haven’t all being engineered and manufactured in Scotland itself.
Instead of being manufactured exclusively by Scottish companies, some of the major complex components were awarded to overseas companies such as Eversendai, an international engineering and construction company with HQ in Malaysia. This situation caused an uproar in Scotland, with voices such as the GMB union claiming that the decision to outsource the production to foreign companies gave the lie to the claims – frequently made – that renewable energy would lead to a ‘green jobs’ revolution in Scotland. The decision was regarded as being a particular slap in the face for the Scottish manufacturing sector because at the time companies such as Burntisland Fabrications (BiFab), (in 2021 taken over by Harland & Wolff) with engineering sites in Fife and Stornoway, had secured backing from the Scottish Government to secure parts of the contract. SSE renewables claimed, however, that the gap between the submissions from overseas firms and that made by BiFab was, in their words “too significant to close”.
Nor was this the first time a decision of this kind had been made. In 2019, EDF built a wind farm 10 miles off the coast of Fife but, once again, ignored BiFab in favour of having the majority of its supply chain delivered in Indonesia. To any casual observer, the decision to hand major elements of the work of delivering a large-scale project that’s going to sit off the coast of Scotland – a country with a rich heritage of ship building and large-scale construction – to companies based in the Far East or Middle East might seem somewhat perverse. The fact of the matter, however, is that Seagreen packed a double whammy in terms of the demand placed on any contractors by being a huge project set to be delivered to an extremely tight timetable. The expectation is that the project will be delivering electricity to upward of a million homes by late 2022, a target which means that any yards involved in manufacturing would collectively have to be able to handle the capacity involved in turning a project this size around in a relatively short window of time.
Capacity and Expertise
In layman’s terms, building and installing the platforms for the wind turbines in the kind of deep water to be found 27km off the shore of Scotland is akin to building a tall building, only the top of which is visible above water. Building the tall building in question, however, involves shipping the various components out to the site, offloading them into the deep water and then carrying out the work involved in installation, all the while dealing with the kind of wind and currents that are a fact of life in this part of the world. It’s perhaps instructive to point out that the initial trial offshore turbines to be constructed in Scotland were in fact constructed on the existing structures of decommissioned oil rigs, which may help to explain the fact that anyone looking for a contractor to deliver a complex, sophisticated offshore wind farm development will, first and foremost, be looking at companies with a good recent track record in terms of oil and gas platform development. Although it’s impossible to be privy to the precise thinking of the people behind the Seagreen project – and commercial sensitivities mean we’ll probably never know what the situation vis-à-vis the respective prices quoted for the work was – it seems clear that the decision to award some major parts of the project to companies such Eversendai to its modern well equipped and efficient oil and gas fabrication yard in the Middle East was made on the basis that this company was easily able to demonstrate its ability to deliver in terms of capacity and expertise.
One of the driving imperatives of any project of this size – and involving this degree of capital outlay – is the speed at which it has to start delivering a return for investors. Similarly, for the UK government – particularly post COP26 and further commitments regarding net zero – the onus of a project of this size and scope is for it to start delivering renewable energy as quickly as possible, and while the expertise and experience may well be available in Scotland the unfortunate truth seems likely to be that the priceless combination of experience, expertise and capacity – the holy trinity needed to deliver excellence and scale at speed – can only be found by sourcing internationally as well as domestically.
Scottish Connection
While seeming to provide bad news for some Scottish engineering companies, however, the Seagreen Project has been extremely good news for Pinnacle, the Scottish based company behind MatriX, the project management software which is being used to deliver Eversendai’s share of the Seagreen project. MatriX has traditionally been used by Eversendai when working on oil and gas projects, and so when Petrofac, the company behind the contracting out of the work to Eversendai, insisted that they use Matrix rather than the traditional spread-sheet based method of project management, they were only too happy to comply.
Not only was using MatriX a prerequisite of Eversendai being given the work, it was also stipulated that they had to use people on the ground, closely involved in the construction phase of the project, who were familiar with the MatriX software and how it works.
Having very successfully used MatriX in the delivery of oil and gas projects, Eversendai were able to transfer it across to the delivery of a renewable energy project with little if any change to the overall framework, with the only real differences amounting small shifts in the nuances of the reporting style and the requests put forward by Petrofac. Despite these differences in the reporting structures and the templates, fundamental processes relating to areas such as material takeoffs, production planning and quality control – basically everything from the front end to reporting – remained almost exactly the same. One of the key drivers behind Petrofac’s insistence on the use of MatriX, as well as the fact that Eversendai were only too happy to comply, was the fact that it has proved to be an effective and robust system for the delivery of a wide range of past and current projects, including, a number of new offshore and onshore oil and gasfacilities for major companies such as Saudi Aramco. Another indicator of the key role that MatriX was to play in the delivery of Seagreen was the fact that Eversendai, having let some people go when the most recent downturn in the oil and gas industry hit, now found themselves in the position of having to entice those same people back, and the reason why they needed those specific people was because they immediately brought with them hands on proven experience of successfully delivering projects via MatriX.
Maximum Efficiency
At this point it’s probably worth exploring what it is about MatriX exactly that means so many parties involved in Seagreen felt that it was the only project management tool they could imagine working with. It has to be remembered that a customer handing a contract of this kind to a company like Eversendai will only do so if they feel utterly confident that it will be delivered on time and in a cost-effective manner, notwithstanding complexities such as shipping the component parts of the project some 4,000 miles from the manufacturing base in the Middle East to the site of installation in Scotland, dealing with the cost of shipping and the various regulatory frameworks involved in the process. In addition to this, Eversendai themselves had to be certain of being able to make money from the project, which is why maximum efficiency at all stages had to be the bare minimum that MatriX could deliver.
See The Whole Picture
From a strategic perspective, the main improvement offered by MatriX when compared with the use of spreadsheets – no matter how sophisticated – is that the structure of MatriX is predicated on being able to pull together an integrated picture of the entire project. In the past, project management may well have been driven by an excellent spreadsheet or database for the engineers, a first-rate spreadsheet or database for production planners, a superb spreadsheet or database for the Quality Assurance department, and so on, all of which amounts to spreadsheets or databases made up of separate silos. With MatriX, on the other hand, the various information streams are brought together in the form of a single integrated database which provides a visible, traceable outline of the project as it develops. By consulting MatriX anyone involved in the project can gain a clear sense of exactly what is happening across the board here and now, and what the impact will be of decisions being made by the various departments along the chain of production. At the same time, despite the integrated and comprehensive nature of the information contained within MatriX, the software prevents the all too common issue of the same information being duplicated across various departments in a manner which renders it redundant. With MatriX the people tasked with delivering a project have one clear version of the truth of the state of that project to work from at any given time. Each application across MatriX has its own governances which ensure that the information entered into them – from day one – is 100% correct, and as this information feeds through the system – and is added to by other people – it remains wholly accurate.
Scottish Project Management Excellence
At the time of writing the first stages of the Seagreen Project have been delivered on time and on budget, and MatriX has played a huge role in making that happen. The disappointment of some of the work not being contracted to Scottish yards – a fact which reflects the genuinely global nature of the industry as much as anything else – can be tempered with the knowledge that it is Scottish excellence, in the form of MatriX, which has been underpinning delivery of some significant components. From an investor’s point of view, project management using MatriX can help to ensure that the kind of profit forecasts made at the outset of such a project are met without the kind of delays and revisions which can so often erode margins. If unforeseeable problems do result in those margins being eroded, the fact that MatriX has been used to track every moment of delivery will make it possible to go back and find out exactly what could have been done – and what could be done better on the next project – to prevent that margin slipping and to maximise gains on the next project.
