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  • 2014 April 11

    Oleg Timofeev, Deputy Director General of Krylov State Research Center: “customers need both technical and financial solutions”

    Oleg Timofeev, Deputy Director General of Krylov State Research Center and Chairman of Science and Engineering Board at Russian Maritime Register of Shipping, tells IAA PortNews about the development of new shipbuilding technologies, challenges and prospects of the industry as well as about LNG shipping. 

    - Mr. Timofeev, what are major directions for the development of shipbuilding technologies and production of marine facilities?

    - The shipbuilding is not likely to change considerably in the nearest time but new solutions are required for the off-shore Arctic projects as the conditions there are absolutely different from conventional regions of navigation and maritime activities – standard approaches are not applicable there.  Generally speaking, all technologies for our Arctic projects will be probably associated with underwater facilities as horizontal ice load is a challenge for, let’s say, the Kara Sea. I refer to automated unmanned platforms. For example, a Gazprom operates a subsea production complex at Kirinsky field. Only three companies in the world manufacture such platforms today. Such complexes can be designed for several wells and their average cost is about $200 mln.

    Another area for innovations is the transition to new treatment of formation fluid. It is conventionally delivered to the shore while today they tend to offshore treatment.  Shell’s floating LNG facility could be a good example. The largest floating structure will be able to produce only 3.2 mln t of LNG per year. So, the market needs a space-saving and efficient technology for gas liquefaction. 

    Another interesting activity for us is the development of technologies for offshore production of synthetic fuel.   

    When speaking about innovations we should take into consideration that shipbuilding is a hard industry with an exclusively high cost of product. For example one Airbus craft costs $300 while one icebreaker costs EUR 1 bln, a platform for Shtokman – approximately $4.5 bln. Therefore, nobody wants to risk here, with innovations in particular.

    - What are the opportunities of Russia in this sphere and what is the role of Krylov State Research Center?

    - We have accumulated certain experience in this sphere and our basic task here is to unite our domestic developers. Unfortunately, we are separated from each other because the market is not sufficiently developed in Russia. The center undertakes to integrate “clever minds”. 

    A production platform could be the first result of this work. Such a platform will let develop small-scale gas fields including liquefaction of gas. Upon the field depletion, the platform will be moved to another field but it needs a customer. In Russia, our customers are vertically integrated oil and gas producers. However, to implement this project we need a licensed private company and adequate financial schemes for investment into the project. 

    Technical development and studies for a conceptual design have been carried out for 5-6 years on the basis of the methanol project for the Barents Sea, which could be relocated to different fields. This project would be interesting if we could raise loans with 2-3-pct annual interest (not 13% as it is possible today). We understand now that the customers need both technical and financial solutions.  

    As for the technical ability of Russia, I should note that the subsea equipment built for the defence industry is very reliable. There are forms designing and manufacturing good equipment able to work at the depth of up to 6,000 m, like Proletarsky zavod, Malachite etc. The problem is that potential customers are not aware of this opportunity.  Moreover, it is easier for them to place orders abroad rather than to develop the industry here. 

    - You chair the Science and Engineering Board at Russian Maritime Register of Shipping. Is the Register able to keep up with the times when it comes to the recent trends and modernization of rules in compliance with the new realities?


    - Actually, Russian Maritime Register of Shipping keeps abreast of the recent trends, updated the rules and issues new ones, pushes forward to the offshore areas. The Krylov Center cooperates with the Register introducing our experience into the Rules and Regulations.

    - Lots of new ship designs appear in Russia today. Could you explain this ‘boom’ and name the brightest design of the Krylov Center?

    - Owing to the federal special-purpose programme “Development of civil marine facilities” some 50 new designs have been developed in Russia from 2009. 

    The Krylov Center develops conceptual designs of quite high level of readiness. Our conceptual design of a drilling vessel has entered the international market. In the presence of Vladimir Putin, Krylov State Research Center signed a cooperation agreement with the Italian shipbuilding concern Fincantieri S.p.A. 

    It is an Arctic class vessel. Fincantieri was chosen as a partner as it is really able to build such a vessel while standard vessels should be better built in Asia. We consider those marine facilities as a highly technical product.

    - There are plenty of new designs, which is a positive fact. However, what do you think about the possibilities to build such new vessels in Russia?

    - It is not easy. First of all, any partner coming to our offshore projects attracts its own contractors and ideas. Former production sharing agreement is not applied today as it contradicts WTO regulations.

    Besides, the quality and compliance with construction terms is not a competitive advantage of domestic shipbuilders as compared with foreign shipyards while this is a matter of investment profitability for the customers.

    If we divide the domestic industry into scientific research, designing and shipbuilding, I would say that we are not behind the rest of the world in the sphere of applied sciences, and in some positions we are superior.  

    But the designing ideology of our bureaus does not contribute to the result as work payment is based on standard hours, not on optimal technical solutions. It is also our weakness. That is why we are confirmed that conceptual and preliminary designs which determine technical and commercial advantages of products should be the area of responsibility of applied sciences and top-engineering.

    - From 2015, stricter requirements on sulphur content in ship bunker (down to 0.1%) come into effect in the Baltic and the North Seas. What alternative fuel is the most promising one in your opinion and what are the challenges of its use?


    - In our opinion, LNG is the most promising fuel, though we see some negative aspects. For example, the calculations carried out for the conversion of icebreakers “Moscow” and “Saint-Petersburg” show that it will reduce their endurance from 35 to 7 days with the space available for fuel system. 

    However, it is or for certain vessels, like ferries, short-sea vessels and liners. With LNG bunker terminals in Rotterdam and Primorsk such liner could efficiently operate at the line. Bunkering infrastructure should be developed in the Baltic Sea. The future is most likely in gas fuel. 

    As for us, we are willing to cooperate in issues related to the development of gas storage systems (the storage time of liquefied gas is limited because of gas evaporation) and refitting of gas engines. 

    Standard duel-fuel engines are now produced by Wartsila. We do not see such a manufacture in Russia so far. We should find partners in Russia. 

    As for gas storage systems, Russia lacks adequate specialists.

    - What are the development plans of Krylov State Research Center for the nearest time?


    - This year we start operating new ice basin and plan commissioning of new maneuvering and seakeeping basin and offshore basin in 2016 having closed the old ones.

    We strive to concentrate the resources and optimize the number of employees. The older generation resigns and the transfer of knowledge is complicated. There is a breach in continuity of generations. For example, 30% of the personnel at our department are the employees below 30 y.o., there is a “breach” in middle-age personnel and kind of a “rise” among 70 y.o. specialists and elder. 

    As for investments into the development, they are mostly our own and are partly allocated by the state. There are some state programmes which foresee financing of capital expenses with 50-pct co-financing from the business profits. 

    Interviewed by Nadezhda Malysheva and Vitaly Chernov