Alistair Birnie, chief executive of Subs
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Subsea UK is driving a concerted effort to capitalize on the opportunities in Russia.
The industry body believes the Russian market presents significant new business for UK companies but only if they act on it now before the window of opportunity closes.
"The UK has the capability and the expertise to support, finance and deliver major capital projects in upstream production, facilities or infrastructure and has a long track record in working with overseas partners in achieving success. We can help build Russian competency in the upstream sector," said Alistair Birnie, chief executive of Subsea UK who has just returned from a highly successful trade mission to Moscow and Murmansk in association with SDI and UKT&I.
"Scandinavian companies and Norway in particular have already made significant in-roads in establishing relationships at the highest level. Some Scottish and UK subsea companies are starting to do the same but we must ensure that we don't leave it too late and lose out to our competitors.
"The UK subsea sector leads the way around the world and the Northern waters of Russia promise to be the next global energy frontier. The unrivaled experience and expertise of the UK's subsea supply chain could hold the key to unlocking the potential in the Russian Arctic shelf. Our industry and our Government need to demonstrate to Russian industry and Government that we can collaborate to overcome the technical challenges, lack of infrastructure and labour shortages."
During his visit to Murmansk, Birnie signed a Memorandum of Understanding (MOU) between Subsea UK and Murmanshelf, an organization that helps businesses enter the oil and gas industry in the Murmansk region. The aim of the MOU is to develop relationships to facilitate UK participation in the region and ensure Uk companies are on the main contractors' sub-vendor list.
At the heart of the opportunities in this area is the giant Schtokman gas field. Located at a depth of over 300 meters and nearly 600 kilometers from the mainland, this field is estimated to hold about 1% of total global gas reserves. Investment in Schtokman alone is estimated at $50 billion with investment decisions scheduled for 2010.
"Murmansk will play a critical role in the development of this field and become the center of onshore production. The region has infrastructure developments totaling $8 billion planned which will transform this region of Russia. The Schtokman field, one of the largest developments in the world, has some unique challenges. As the first of a series of 24 field development in this region, the technologies and methods developed here will potentially be exploited to other parts of the arctic region, making it a hotspot for our member companies.
Subsea UK is a self-sustaining industry body that champions the UK subsea industry at home and abroad. With over 200 members, it represents the entire subsea supply chain in the country which employs 40,000 people and generates sales of £5 billion.