Duco is one of the founding fathers of the North East subsea industry and a quarter of a century on is still growing strongly. Peter McCusker reports on this Tyneside success story
In a new research and development facility on Malaya Drive, Walker, more than 30 of the world’s leading R&D subsea engineers are creating and refining ground-breaking technologies never seen before.
On the testing floor nearby, rows of temperature and pressure machines will put their creations through months of round-the-clock trials to prove their robustness and suitability.
Down the valley, about a three-minute walk away, on Wincomblee Road, next to the River Tyne, is Duco’s main manufacturing plant which creates its bespoke, world-leading umbilicals. Opened in the late 1980s as a partnership between Dunlop and French company Coflexip – hence the name Duco – its initial aim was to develop the groundbreaking technology needed to recover oil and gas reserves from the North Sea.
Over the past 25 years it has led the world in the thermoplastic subsea umbilical market and now, as the exploration and production companies head into deeper and deeper waters the need for reliable supporting infrastructure is ever more critical.
Consequently, just a stone’s throw from this factory, a new multi-million pound facility is being created by Duco’s owner French oilfield services’ giant Technip (it merged with Coflexip in 2003).
This new vertical-helix steel umbilical plant is set to open early next year and is designed to help the company capture the lion’s share of the rapidly developing global subsea market.
Jean Louis Rostaing, managing director of Technip Umbilical Systems, said: “We are currently the main player in the thermoplastic umblicals market.
“But 70% of developments now require steel umbilicals as the subsea sector is going to greater depths in the ocean and we had no real capacity to allow us to do this properly. As a result of this investment we will be able to secure a large portion of both the thermoplastic and steel umbilical market.”
Subsea production is now the main type of recovery method in most deepwater oil and gas provinces. The global market is currently worth around £20bn and is expected to quadruple to £80 bn by the end of the decade.
Subsea production systems involve the installation of a series of wells on the seabed which can be operated from a fixed or floating platform.
Umbilicals are an essential part of all subsea developments as they provide power, control and chemical supply to accompany the work of the subsea production equipment.
With all subsea developments presenting their own unique challenges, depending on depths, topography, pressures and temperatures, all of Duco’s umbilicals are bespoke.
The company recently created the world’s largest subsea umbilical, in terms of outer diameter and weight, and one particular umbilical for the Skarv development in the North Sea comprised of over two dozen hoses, housing fibre optics, electrical power cables, chemical injection lines and hydraulic control.
Next door to Duco’s riverside facilities is the home of world-renowned subsea flexible pipe making company Wellstream and close by are other leading lights of the Tyneside subsea sector.
Rostaing, who came to Newcastle from Paris five years ago, said: “What’s happening in the North East subsea sector now is really good. This is a real hub for the industry and there is a real bond between companies in the sector.
“There are a lot of people coming into the North East to work because they know there is not just one subsea company, there are a number, and it gives bright people a chance to develop their careers in the North East region.
“This is good for the region and the industry and it’s also really important for clients. They can visit us here at Duco, then go to SMD and Bel Valves.
“This works to the advantages of the North East and our clients. We are a region that can offer a full package to the industry’s main companies.”
The UK is the leading player in the global subsea industry. Recent figures from industry body Subsea UK show that the UK accounts for £9bn of the £20bn market worldwide.
Around the time Duco established its base in Walker fellow subsea companies were also developing in the area to service the North Sea market.
These include remotely-operated vehicle (ROV) company SMD in Wallsend, Bel Vales and flexible pipe maker Wellstream, which are both in Walker. These companies are now all world-leaders in their field, and have helped in the creation of a skilled supply chain in the region. They have also prompted the growth of spin-off Tyneside subsea businesses such as pipe laying and ROV specialist IHC Engineering Business.
Senior executives of these companies formed industry body Subsea North East to develop the sector, and it recently unveiled a £30m plan to develop a centre of excellence in subsea and underwater engineering.
In conjunction with Newcastle University the Neptune National Centre for Subsea and Offshore Engineering will be based in Walker and will be the only one of its kind in the UK.
Rostaing added: “A further good thing about being here in the North East is the close relationships we have with the universities. Here at Duco we are fully support the Neptune centre. We have the facilities to test the capabilities of most of our products on site, but things such as hyperbaric testing we have to source from outside of Duco and the UK
“Research and development is a big part of what we do. Our markets are becoming more and more demanding requiring deeper, bigger and longer umblilicals. There is now an emerging demand for smart umbilicals, which can identify any problems in performance as they emerge. The new Neptune centre will help us to develop these.”
Duco is the global home of Technip Umbilical Systems (TUS), which also has facilities in America, Africa and Asia.
At its handful of locations in this corner of Walker, Duco employs 515 people and around 80 contractors, with many working on the new facility.
TUS’ main sales teams are based in Newcastle and service the worldwide global susbsea market. They have already secured orders for its new vertical-helix steel umbilical factory which is due to open early next year.
While the original Duco factory is a horizontal helix thermoplastic production facility the new facility’s production line stands upright.
Consequently this 200ft high grey, blue and red building, with the Technip logo, is now prominent site .on the Walker quayside.
The vertical facility has nine floors from which production line components can be added. A goose-neck line funnels the completed umbilicals on to one of two new carousels to the north and south of the plant
They are both close to the Shepherd Offshore’s 250-tonne hammerhead crane, which lifts complete Duco umbilicals on to ships for transport across the globe. Alternatively, thermoplastic and steel umbilicals can be spooled directly from the carousels on to ships berthed at the adjacent dock.
Back up the bank at the research and development facility Duco’s development and design teams are creating blueprints for new recovering technologies. These that will be operating up to 4000m below the surface off the coast of Africa and South America at pressures of 20,000 psi, that have never been possible before.
Rostaing, a keen golfer who lives in Newcastle with his wife and family, says he enjoys living in the region, with its culture, coast and countryside.
Over the past five years he has become aware of a further strength of the business “We have lots of good people and want to keep our good people. I used to be surprised how the people of the North East and Newcastle like to stay in the North East and Newcastle.
“As part of the Technip Umbilical Systems group we ask people to go to the States to other locations worldwide, but now I see now why they don’t want to go. I can see now what the North East has to offer.”