There is a term often used in the offshore sector, “lessons learned”, at the end of every operation or every project it is best practise to sit together and discuss what could be improved, what was effective and where any residual risks remained in the tasks.  This information is then aggregated and fed back to the companies and should be applied subsequently.

The goal of this task is to make things safer and more efficient.  It is based on the same principles as the scientific method.  We do things, we see what happens, we record it and learn from it.  It is a good foundation.

To date I have been involved in most aspects, from design to installation and remedial works on over $200 billion (USD) of energy infrastructure projects around the world, and I carry in my head a very long list of lessons learned: most of it now so deeply engrained that it is second nature.  I have seen local content issues, ineffective labour laws and union actions destroy industry momentum in many places, such as Australia and Brazil to the detriment of all parties.  I have seen tens of millions of dollars lost to logistics issues.  I have worked in most of the oceans and seas of the world and am very familiar with time lost on projects due to ocean swell (wave heights and periods), wind and tidal currents, not to mention visibility.

(Source: CommonWealth Magazine)

I could simply write an article on the broad range of considerations that cause problems for projects, environmental and geophysical factors, unexploded ordnance, regulatory frameworks, inexperienced crews and under resourced projects, an endemic of false economics, micro-management and excessive churn in the skill base.

Taiwan has it all.

Anachronistic and ineffective marine regulations, onerous and redundant policies and processes, poorly framed local content requirements, strong ocean currents, complex and challenging climatic conditions, exhausting import restrictions, inhumane crew change mechanics and most of the developers are framing such poor contracts that the end products will be barely up to specifications and are not likely to meet the projected energy outputs for their full lifespans.

There are so many ways Taiwan is more complex to work in than any other country I have ever been to.  In Nigeria, if I had someone who need to get home from a ship that was 300km off the coast because their partner was ill or a relative died, I could get them to almost any point on the planet within 48 hours.  I know that, because I had to do it several times.  Same was true in Congo, Angola and most of sub-Saharan Africa.

Most of the time in Europe, I could get someone off a ship and home within 12 hours.

If you remove COVID-19 from the situation, in Taiwan, it can still take 9 days to get a crew manifest approved.  It would take at least 2 weeks to get someone home.  I know that, because I have seen it happen several times over the last year.  This is not even related to quarantine or PCR testing requirements, it is simply about the paperwork for a crew change.

In Taiwan, every port has different requirements for entry. There is no simple, modern, national regulatory framework for getting a ship in and out of a port.

You cannot imagine the complexity in even getting food out to a ship.  These large energy projects require expensive large construction vessels with hundreds of people on them, mainly specialists with extensive experience and training and assembled from dozens of countries around the world.  These ships are very expensive to run, even when they are not actively involved in production.

In Taiwan, the restrictions to load a container with food and send it out to a ship, to keep the crew well fed and prevent the ship from coming into port, is beyond anything I have seen anywhere else.  Every container, quite rightly, has a manifest, a list of everything in it, where it came from and where it is going.

My understanding is that in Taiwan, there is no option to state that the destination is to a vessel offshore.  It can only be from port to port in almost every permutation of paperwork possible in the country.

This means that on several occasions, the construction vessel (not the most fast moving entity in the world) has to pack up its operations, seafasten everything on deck, transit to a port, wait for a pilot, moor at a quayside, load on all it needs and then head back out.  It may be able to endure for three or four weeks with its supplies, and then lose a week from this process of coming in to load up again.  A 25% loss in productivity right there, and a lot of additional costs.  Let’s be generous and call it a 20% loss.

Climatic conditions mean you can only work in the Formosa strait for about half the year anyway.  There are some processes, vessels and equipment that could extend that, but with the restrictions on bringing even critically specialist vessels into or out of Taiwan, it doesn’t make it an option for most companies.

Then you add local content restrictions, strong currents, delays in bringing in equipment, sourcing local alternatives, under-developed local skill base and all of the other challenges and the mathematics just don’t stack up.

In the North Sea, operating between Norway, the United Kingdom and the Netherlands you may end up with about 300 days a year that you can remain operational offshore.  You may lose something like 5 to 10% extra in operational inefficiencies, delays, breakdowns and similar.  We would typically come in at less than 1% breakdown time on most well run vessels, for instance.

This adds up to a rough comparison of perhaps a total efficiency in the North Sea of around 70%.  So, something that would cost you a million dollars in a perfect world, may end up around one point five in real terms in that environment.

Compare that to Taiwan, where you have mobilised your fleet, your crews and a broad range of specialist equipment here for a project.  On the drawing board, the project might take 18 months end to end, with no weather.  Once you factor in climate, regulations, logistical delays, restrictions and other practical considerations, you are probably running at around 20 to 30% efficiency if you are lucky.  So, a one million dollar perfect operation would cost you four or five million in real terms in Taiwan.

This inevitably leads to short cuts, substandard results, poorly designed contracts, over inflated budgets, excessive breakdowns, resource shortages, skill gaps, elevated risks and massive impacts on time and materials.

Now, the more cynical people may think that it is not that big a problem if some large companies lose some money on a few projects.

You could not be more wrong, and this is why.

Taiwan sits on several fault lines, some of those fault lines are political, technological and social.

(Source: CommonWealth Magazine)

Already there are major EPC companies talking about leaving Taiwan for good as soon as their commitments are done with the current projects, and this is not a threat being made, it is internal chatter.  It is what my peers are saying to one another across several companies when we meet for drinks or dinner or have back-channel discussions about a broad range of topics.

It happened in Australia after Gorgon and Wheatstone project budgets ballooned out of control because of union representatives stopping multi-million-dollar a day operations because of the wrong flavour ice cream was being provided (not an exaggeration).  It happened in Brazil because of excessive local labour content requirements and local corruption.  It happens all the time, and most of the time it is a major regional issue, but not that important globally.

In Taiwan, the stakes are higher.

The political stakes are huge.

If, over the next twelve months, Taiwan assembles a group of key government stakeholders from across the departments with a clear focus to make things work, to streamline the processes and to work with companies, then there is a chance to turn it all around.

If Taiwan drags its heels, has a fractious and fragmented internal approach to interacting with (not just developers) but contractors and major sub-contractors, and does not look to rationalise processes then the companies will disappear.  Momentum will evaporate, energy shortfalls will not be met in time, water, power and infrastructural development will become increasingly risk prone, desperate and done by lower quality companies willing to cut every possible corner.

Taiwan is at a crossroads.

Down one road lies a modernised, sustainable, integrated country with a solid foothold in the international community.  Down the other road lies a desperate country wriggling on the end of a hook for the shadow that peers across the strait, looking for every sign of weakness.

I love Taiwan.  Of all the countries I have ever worked in, lived in or travelled to, the people of this country are the most loving, welcoming, kind and generous anywhere in the world.  I want to make this my home.  I want to be here and make a stand with you, working side by side to get it right.

I am not the only one that feels this way.

Help us to help you.  Let us all join together to make things work.

(Source: NPI)

We can solve the freshwater scarcity, we can provide all of the clean power that is needed to fuel growth, we can build a modern infrastructure, we can develop the local skill base and expand the economy for the benefit of all.  These are not overly difficult technical issues, they are problems with political will, a divided vision and a lack of imagination with financial modelling.  As someone who has built a lot of big projects around the world, none of the problems here are that complex from an engineering perspective.

So, Taiwan, we wait, holding our breath, to see which road you choose.

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About the author:

Kim Asher has spent over 2,500 days offshore on heavy construction projects in over a dozen countries.  She also has a decade spent as a business analyst and has degrees in both international relations as well as subsea acoustics.  She now lives and works in Taiwan on renewable energy projects.  The contents of this article are her personal views.

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