Contractors seek role as real partners

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The wind industry is expecting offshore subcontractors to unfairly carry much of the risk while not treating these companies -- the experts, with years of experience in offshore construction -- as true partners. So comment two large Dutch offshore industry contractors that have been active in the early stages of offshore wind, Mammoet Van Oord and Ballast Needam, in the latest issue of Windpower Monthly's sister publication, Windstats Newsletter.

xMammoet Van Oord, a heavy marine transport and installation specialist, owns and operates a purpose built "jack-up" type installation barge named Jumping Jack. This vessel has most recently done foundation and installation work for the Scroby Sands wind plant in the UK and at Ireland's Arklow Bank facility. Mammoet van Oord seriously got into offshore wind in 2002 when it received a contract to install all 80 foundations for the Danish Horns Reef wind farm. "Entering into a new challenging offshore market was our initial perception," says the company's Adrian van Oord, adding that this has so far proven to be a moving target.

x"One complicating factor is that companies like ours mainly work as sub-contractors and are usually called in at the end stage of a project," he says. "Wind turbines are being manufactured in a relatively low-risk series production environment, but real weather related and other risks are included with installation -- and these are passed on entirely to sub-contractors."

xRisk for the contractor is also increased by the highly competitive, project oriented approach. "That means trying to make the best possible risk assessment for each individual project, but in practice we have only limited means to influence lump sum contract prices," says Van Oord. He hopes the rather bleak situation will improve once the number of projects and the total market volume grows. Unforeseen risks can then level out over multiple projects and in turn have a positive effect on the average profit/loss ratio that contractors have been used to living with, he says.

xBallast Needam is a civil engineering and offshore contractor, intending to do its first wind project with the installation of the Dutch 99 MW Near Shore wind farm in 2006-07 (Windpower Monthly, March 2005). Edwin van de Brug of the company agrees that the current situation is far from ideal, where offshore installation sub-contractors bear most of the risks and are at the same time solely selected on the basis of contract price. In the longer term, these involuntary unequal partnerships will work out to be contra-productive, he says, referring also to Mammoet Van Oord.

x"We are international contractors with decades of experience working under huge time pressures in demanding maritime project type conditions," says Van de Brug. "That includes risk assessment, planning and integration of methods, quality procedures and implementation of activities. An essential point we suggest for all parties involved with offshore wind is that they start acting as partners during all project stages."

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