March 26, 2014: Panalpina's specialized division for large-scale projects is one of the fastest growing areas of its business. Known as Panprojects, the division experienced 20% year-on-year turnover growth in 2013 and now has over 400 dedicated staff. One of its latest and largest projects involved work on an offshore oil platform section for energy giant BP in Azerbaijan.
The ceiling transport and logistics cost for a single industrial project is expected to cross the $1 billion mark in the near future, such is the growth of this increasingly important aspect of business. Large projects are huge transport endeavours that require expert planning, monitoring and compliance – three areas where Panalpina's Panprojects division has developed best-in-class capabilities and where the company is experiencing growing success.
Panprojects was established in 2002 to directly address the logistics needs of the world's most ambitious industrial projects. The service creates tailor-made, end-to-end transport networks for each project.
Chris Kent, global head of Panprojects, attributes the division's growth to its vast experience and flexible approach to these large jobs that mean it can tailor its workforce and global set-up to suit specific projects.
"We've spent years developing the people and processes that improve efficiency on major projects," he says. "Our people around the world have the local expertise and the global support to establish new routes and continually develop better ways of working on a single project. Their health and safety, together with that of our subcontractors, is a top priority for us and they work in a framework that demonstrates full compliance with legal and regulatory requirements."
Panprojects can be working on up to 40 projects around the world at a time. The majority of its work is conducted in the Middle East, Australia, Latin America and the U.S. The oil & gas industry in each territory is a major user of Panprojects, along with the mining industries of Latin America and Australia and global power and utility providers.
Many of the world's largest industrial projects are located in landlocked, isolated areas, which often require upgrade work to ensure that local road and rail links can carry regular and oversized loads safely. Panprojects conducts detailed route and site surveys along the entire supply chain, being sure to account for limitations imposed by seasonal, climate and even political changes. Moving unusual and oversized loads generally requires authorization and customs clearance at several stages of a journey.
BP platform in Azerbaijan
One of Panalpina's recent major projects is in Azerbaijan where after many shipments of components the topside unit of an off-shore oil platform recently set sail for final assembly in the Caspian Sea. The platform was deployed for the Azeri-Chirag-Deepwater Gunashli field, which is operated by BP.
Panprojects started its work on the West Chirag platform in late 2012. Since then it has handled more than 2000 international and local transports. Specialized equipment, machinery and components continue to be transported by road, air and sea in a constant flow to the site.
The BP project involves lots of critical fast-track moves that demand a flexible approach. Goods come in in all shapes and sizes, and from all over the world, including the UK, the Netherlands, Italy, the U.S. and a number of countries in Asia.
"The importance of on-time delivery at large projects cannot be stressed enough," says Kent. "Delays at multi-million dollar projects mean excessive and avoidable cost. Monitoring is therefore crucial to give shippers transparency but also to maintain a high quality service. We also analyze our own performance to identify potential shortfalls and continually improve our operations."
The West Chirag platform project is handled by Panalpina under its framework agreement with BP, which was agreed in January 2012. This partnership aims to develop the oil & gas industry's most efficient and cost effective supply chain for large-scale projects.