North Sea oil industry veteran's 40 years in sector

Former Amec Energy chief executive, NOF Energy honorary president Dennis Clark, OBE, reflects on his years in the industry, with Peter McCusker

Dennis Clark
Dennis Clark

As the potential magnitude of the North Sea oil industry began to crystalise in the early 1970s, Dennis Clark’s boss at the time sensed an opportunity.

“We can do it all,” he told young Clark. “It’s basically a box on legs, which is put in the North Sea. We are going to be building oil refineries on stilts.”

This was no Yosser Hughes boast and within a few years Ray Daniels, managing director of Press Construction, had turned his vision into reality

Hartlepool-born Clark had joined the Darlington-based business in 1966. At the time Press was successfully meeting the construction needs of the Teesside petrochemical industry.

By 1972 as a chief surveyor at Press, Clark was part of a team which set up the North East’s first offshore fabrication base in a former ship repair yard at Howdon on the north bank of the Tyne, near Wallsend.

Press senior executives had hitched up with partners in Houston, as the US was already working in the offshore environment in the Gulf of Mexico, and secured two North Sea fabrication jobs from Shell.

With it being the first major project of its type Shell senior executives would travel up to Howdon every couple of months to see how the work was progressing.

Clark says modestly: “We did not really know what we were doing, and we later discovered the North Sea temperatures and wave heights meant it is totally different from the American experience.”

The Auk was the first fixed platform in the North Sea and for Press its contract with Shell consisted of five topside modules with a total value of £2m.

The BBC TV programme Tomorrow’s World filmed on site as Press developed new techniques for moving the huge structures. “It was all pathfinder stuff,” said Clark.

He continued: “When the contract was finished we had lost money so I put together a contract claim and Bill Bell the chief executive of Shell arrived with his top lawyers and commercial people.

“The chief executive told everyone to leave the room except me and the MD. He referred to me as ‘Mr Clark’, I was only 27 at the time and no one had ever addressed me like that.

“His commercial man put an envelope on the table and said ‘take what’s in there, and if you don’t like it then there’ll be no more and we’ll be off’.

“There was £250,000, and an order for two more topside packages. We took it.”

Press’s lead in becoming the first modular construction yard in the North East and producing the first topside in the North Sea established a path for others and by the early 1980s there were 30 fabricators across the UK, including many famous North East yards such as Redpath, Whessoe and Laing.

Press continued to grow with the Howdon yard expanding its riverside footprint into what is now the Hadrian Yard – where Clark’s latest venture the OGN Group is based.

The OGN (Offshore Group Newcastle) Group, has secured hundreds of millions pounds worth of offshore fabrication contracts since its launch in 2008 – and its new jacket for Talisman Energy in the North Sea’s Montrose field is due to be completed in the next few weeks.

OGN which employs 1,000 people, also has ambitious plans in the offshore wind sector having secured planning permission for a new facility to make jackets (foundations) for offshore wind turbines.

In 1982 as managing director of Press Offshore, Clark had helped grow the business into the biggest fabricator in Europe. It had a global reach and offices in Aberdeen and Great Yarmouth as well as employing 5,000 workers at the Hadrian Yard in Newcastle.

Clark reflects that one of the biggest challenges of his career – and one which in hindsight secured most kudos – was an industrial relations issue in 1987.

It was a job for Exxon and Shell in 1987 on the Kittiwake development which was the biggest structure in the North Sea at the time.

Clark said: “We’d finished the job on time but 2,000 workers downed tools and said they wanted a completion bonus. If we’d given in that would have been the downfall of the industry.

“I told the Exxon chairman the management would load it out and sea fasten it. ‘We’ll not let you down’. We had 1,200 people at the gates shouting at us, we didn’t lose our bottle and we got the next job off them on the back of it

“Normally with the oil companies it’s a master/servant relationship but that day the Exxon bosses looked us in the eye and you could tell it had changed. There was appreciation and gratitude.”

Not long after Clark was honoured to receive an OBE from the Queen for services to the oil and gas industry.

In the same year, 1989, Press was bought by Amec and Clark was made chairman and chief executive of its process and energy division with a seat on the main board.

It purchased engineering design consultancy Matthew Hall and by 1993 the energy division had almost trebled in size to a business with revenues of £700m.

Around this time Clark was asked by John Bridge, chief executive of the Northern Development Company to bring together the North East offshore industry, leading to the formation of the NOF.

In the early 1990s the oil price fell sharply, there was a lack of investment in the North Sea and the number of UK fabricators fell from 20 to four.

Clark said: “The fiscal regime became tougher and the lack of interest in the sector from the last Labour government is demonstrated by the fact that there were some 16 energy minsters.”

Clark left Amec and later joined East Anglian outfit SLP in 1999 before returning to the North East and establishing the OGN Group in 2008.

Clark sees similarities between the 1980s and today in the industry. He said: “Thatcher was a great supporter. Very encouraging. She needed the income and revenues and she encouraged the oil companies to invest.

“George Osborne has done more than anyone since to encourage investment, although that may also be a reflection on the mass lobbying we have undertaken and the Scottish independence vote.”

A Government report into the future of the oil and gas industry has recently been published. Known as the Wood Review its goal is encourage further investment on the United Kingdom Continental Shelf to ensure the country maximises recovery of the remaining reserves of oil and gas.

Clark, as one would expect, has strong views on the future of the UK oil and gas industry and these will be covered in The Journal energy pages next month, when the Government publishes its official response to the Wood Report.

Journalists

David Whetstone
Culture Editor
Graeme Whitfield
Business Editor
Mark Douglas
Newcastle United Editor
Stuart Rayner
Sports Writer