Stena Drilling – Supporting Energy Transition and Energy Security

Stena Drilling talks to us about the critical role of oil and gas in the transition to renewable energy sources.

Stena Drilling was formed in 1996, managing four semi-submersible drilling units working predominantly in the North Sea. That North Sea focus has remained key for Stena Drilling, but in the late 90s the construction and acquisition of Stena’s first dynamically positioned drilling rig, Stena Tay, opened up deep water and subsequently ultra-deepwater basins, worldwide. This paved the way for the business to transition from being a regional contractor to becoming a worldwide contractor.

“In 1999, we took delivery of our first deepwater drilling unit, Stena Tay. Based on the success of that, we then built a midwater unit in Germany, specifically for midwater Norwegian operations, Stena Don, delivered in 2002,” recalls Erik Ronsberg, Stena Drilling’s CEO. “Over the years since then, the business has increased in size. We have bought and sold rigs, but the biggest change for our business was in 2005 when we ordered our first drillship. A further three followed, all from the Samsung Heavy Industry Shipyard in Korea. The first unit, Stena DrillMAX, was delivered on the 31st of December 2007. These are big ships, with capabilities to transit and operate globally. This transformed our business and led to us increasing our staff and support requirements significantly.”

Stena Drilling is privately owned, part of the Stena Sphere of companies. The parent, Stena AB is a family-owned business based in Gothenburg Sweden. The Sphere [of companies] includes Stena RoRo, dealing in roll-on roll-off shipping; Stena Line, one of Europe’s largest ferry operators; Stena Bulk, which operates tankers worldwide; Stena Fastigheter, which owns and manages real estate worldwide; Stena Finance, which supports and manages the financial aspects of the group; and finally Stena Adactum, an investment business with a broad portfolio, from kitchen suppliers & windfarms to garden centres & florists. Stena Metall, a separate part of the wider Stena Group, is one of the largest metal recycling companies in the Nordics. All these Stena companies form an ecosystem of which Stena Drilling is a critical part.

“We’re a diverse group, with a very engaged owner who is keen to add value for our clients, maintain repeat business and protect the environment around us,” Ronsberg says.

A Small Company with a Big Reach

While Stena Drilling has seen a great deal of growth, it is still relatively small compared to its peers. However, this also gives the business a great deal of versatility.

“We are privately owned and can make decisions quickly. We have high-value assets which we keep well-maintained, and we have a very can-do attitude regarding finding solutions to our clients’ challenges,” Ronsberg points out.

Stena Drilling has been particularly successful in finding solutions following the fallout of both the market downturn in late 2014 and of course in 2020, when faced with the Coronavirus situation. When the market collapsed, many peer companies were forced into bankruptcy and subsequent restructuring, while Stena Drilling stayed whole and retained its talent.

“It has been difficult few years for us, navigating the downturn while keeping the group together,” says Ronsberg. “Of late, Covid created a massive drop in demand and contracts dried up. In order to remain intact, we had to look after our people and maintain our assets. We managed to keep our strong culture and keep our drilling units ready to go back to work.”

Today, Stena Drilling is in a stronger position.

“We have six drilling units in operation at the moment. We are hoping to bring another into the market soon, although we have not exercised the option for purchase yet, for a small business we have a very wide reach,” Ronsberg says. “We have just operated a unit off Eastern Canada, now on its way to Egypt; two working in the North Sea; one off Israel and two working off the coast of Guyana in South America. We have managed very well to get these contracts worldwide.”

Fuelling the Transition

Of course, the oil and gas sectors are reaching a key turning point right now, and everywhere you go people are using the word “transition.” But what Ronsberg wants to draw attention to is the key role oil and gas will play in that transition.

“We’re a great supporter of the transition to renewable energy, but it has to be done with care,” he says. “There has been a huge focus on promoting green energy, which we support, with regards to wind and solar power. In fact, one of our sister companies is one of the biggest wind turbine owners in Sweden. But it is important to balance that with just now to provide the oil and gas we need for the transition.”

It is clear from speaking with Ronsberg that sustainability is a core part of Stena Drilling’s outlook moving forward.

“We have a big focus on sustainability and cutting waste. We received ISO 9001 energy management certification last year, which requires us to constantly look for better ways to reduce the fuel we use and reduce emissions at all times,” he explains. “We changed our lighting systems on rigs, installed more efficient equipment, use sophisticated digital solutions to reduce fuel burn, and are optimising drilling technology to reduce the energy we need to run the units. We have also installed solar cells at our base office to reduce the electricity we require from the grid, which has also been very successful. The majority of these initiatives have spawned from innovations submitted by our people on and offshore.”

Stena Drilling’s tagline is “Care, Innovation and Performance,” which is a philosophy Ronsberg stands by.

“‘Care’ means care for resources, the environment, for people and the way we do business,” he says. “‘Innovation’ means we encourage our colleagues on and offshore to think ‘Could you do something better?’ They do not need to reinvent penicillin, but if there is a better way of doing something we want to hear it. Your crazy idea may not be so crazy when someone else sees it. And finally, there is ‘Performance.’ We need to deliver top performance at all times, to be working at our peak & keeping our clients satisfied.”

Achieving More Together

This philosophy sounds great on paper, but it is people that put that philosophy into action, and Stena Drilling draws people from all around the world.

“We have a multinational crew on all our rigs. We have reached that point from being a company founded in the northeast of Scotland, where our biggest contingent is from, but regardless of that we always try to give everyone an opportunity,” Ronsberg says.

Once people are part of Stena Drilling, Ronsberg encourages sincere and open communication across the group to strive to keep everyone on the same page.

“I try to let people know how the business is doing by giving an overview of how the group is performing and what future work is going to be like,” he tells us. “I like to hear people’s views and encourage curiosity, so management can ensure positive stewardship. By promoting an open-door policy, I hope that everyone feels empowered.”

This means more than just coming to the boss if you have a good idea, it also means nobody should be embarrassed or feel apprehensive if there are things they are not sure about.

“Everyone has a job, and everyone has the right to put their hand up if they’re not clear what’s happening,” Ronsberg insists. “It is an approach that is paramount for safety, among other things. People can and should always stop the job if they do not understand the task at hand or if they feel there is a safety issue.”

As well as ensuring safety, it also engenders empowerment at every level within Stena Drilling.

“We have a culture that tries to empower people. I believe in the saying Together Everyone Achieves More (TEAM). I like to think that we are listening to our staff,” Ronsberg says. “Visible leadership is very important, and we try to do that as much as possible while empowering everyone throughout the business.”

It is also key for innovation within the business.

“We all need to pull in the same direction to be more sustainable. I am clear with our people – if you have any innovative ideas, please bring them forward and share them. That is the ethos,” Ronsberg points out. “Innovation impacts everything we do. Good enough is not good enough. It can lead to complacency. Stay curious and keep learning!”

It is an outlook that is more important now than ever.

“Society is waking up to the fact we will need hydrocarbon energy for some time yet. That is not a reason not to invest in renewables, but we have a good future going forward providing we continue to deliver high value, sustainable forms of work which create value,” Ronsberg says. “Right now, there is much more focus on other locations to go forward with during our transition to cleaner fuels, which will hopefully lead to prices going down for consumers as well, but this must be done in an environmentally astute manner. We are hoping to bring a seventh drilling unit into our fleet this year, and then looking forward with our clients.”

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