An offshore drilling contractor was considering construction of a new rig design in an unfamiliar location
The client had developed a new semi-submersible drilling rig design, and was evaluating where to have it constructed. They had narrowed it down to two options: one yard with which they were very familiar, and another yard that was not as experienced, and with whom the client had never worked – but who had offered a considerably lower price.
An independent expert view was needed to understand the range of potential outcomes given each scenario
Given the amount of uncertainty regarding the prices being offered, the client desired to have an independent cost and schedule risk analysis conducted to understand the range of potential cost and schedule outcomes for each scenario.
Westney’s approach to addressing these challenges included:
»Development of a predictive range (P25 to P75) of outcomes for both cost and schedule based on each yard’s respective bid and their inherent risks
»A high-level view on the capabilities of key engineering contractors and equipment providers involved in the design and construction of the asset
»Sizing of best case and worst case scenarios for strategic risks / benefits above the estimate and contingency amount
Our work enabled an informed decision on how to maximize cost savings and minimize risks
The client used our analysis to inform what was previously a very difficult and ambiguous investment decision. They were able to go into discussions with their executive board with “eyes wide open”, strong supporting data, and a head start on how strategic risks would need to be managed. Management was able to make a recommendation on which yard to hire for construction of their new design based on the range of likely end-of-project outcomes from an independent expert, instead of on price alone.
For more information on our approach, take a look at how Westney provides a range of likely project outcomes.