Annual report 1995 - OSTI.GOV

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Transcript of Annual report 1995 - OSTI.GOV

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v. / s\ he activity\Jy IKU experienced a notable decline in several of its business segments in 1995. Low oil prices from 1994 kept affecting the market in 1995, but although fully aware of that fact, the company failed to counteract the many changes brought about during the year. Consequently, IKU had problems achieving its income goals in several segments. A significant reduction in new orders (10%) also confirmed the assumptions from 1994 that the company has yet to succeed in making good market adjustments in all its business segments.

Market adjustments were further weakened as the company’s customers underwent a period of structural changes. At the same time, many oil companies maintained their cost-cutting policy, which had a negative impact on IKU.

But 1995 also had some positive trends, such as companies reducing then- own research departments and outsourcing all or part of the activity. How­ever, a characteristic feature of the market is that there are still many compa­nies in a “transition” phase, i.e. they’re searching for the right mechanisms and corporate structures that will ensure efficient utilisation of research resources, both externally and in-house. ' /

It may seem that the market is about to shift focus from volume, to compe­tence. In practice, that means buying competence instead of project ideas or proposals. The shift toward competence is a time-consuming process, so it will probably take some time before the market stabilises under a,new, structure. At the same time, it has been important for the companies to evaluate the value-added contribution resulting from the purchase and-use of R&D resources. This has an effect on the company’s purchasing behaviour and requires that IKU must change the way in which it collaborates with the companies with regard to purchasing.

In view of developments in 1995, the board of directors feels that for IKU to - have a positive future development, it must adapt its resources to the situ-

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ation at hand. The full impact of the market changes is not yet apparent, and there is reason to believe that some of the changes will have long-term effects.

Consequently, the board decided to implement workforce reductions at IKU, a process that will last until the end of 1996. By then the workforce will have been reduced from 154 in 1995 to 130. At the same time, the management’s chief priority will be to adapt the company to the new market conditions. This entails constant awareness with respect to organisational changes and measures.

trategic commitmentIKU strengthened its commitment to strategically important areas of

expertise in 1995 through enhanced efforts and access to so-called strategic resources. Developing new spheres of expertise and technology is a huge task entailing a long-term commitment (3-5 years). Nevertheless, IKU considers it strategically important and necessary. Through its contact with industry, the company has been encouraged to continue developing the chosen spheres.

Within reservoir characterisation, the goal is to contribute toward a better understanding of the reservoirs in order to optimise oil- and gas production strategies. This is based on IKU’s basis of expertise within geology, reservoir description, formation physics, seismic methods and logging technology.

Reservoir characterisation is divided into the part programs formation evaluation and quantitative geological description. IKU has succeeded in giving this area a technological content that has aroused the interest of oil companies. Its development potential was confirmed throughout 1995 by the establishment of major projects on the basis of the company’s efforts. With support from the Research Council of Norway, a strategic collaboration with the Norwegian Computing Centre has got off to a good start.

Oil pollution and contingency planning is still the mainstay of the Envi­ronment Technology department. The product “OSCAR” - Oil Spill Contin­gency and Response Analysis - was further enhanced in 1995 and is now being presented to the operating companies on the Norwegian continental shelf. An interesting ally in this effort is the Norwegian Pollution Control Authority (SFT) which considers it beneficial that oil companies incorporate this type of tool to improve their preparedness against undesired oil spills and subsequent negative impact on the environment. In 1996, developments in the field of processing will continue, and emphasis will be placed on developing a new priority area in collaboration with the oil industry and the government.

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The Exploration department’s focus on migration studies will be expanded in 1996 to include source rock studies. However, the oil companies’ focus on applications for the 15th licensing round in 1995 made it difficult to access the industry as early as expected. Consequently, IKU did not get the clarifications necessary for advancing its sales efforts. The company’s aspirations for these two priority areas are based on a solid knowledge of the oil companies’ needs and they may be important sources of income for IKU in the future. The department has attained a key position within the Research Council of Norway’s user-controlled programs where it is a main applicant for three long-term projects, two within the “LETE” program and one within the deep-sea technology program.

7inanceThe company posted an operating deficit of NOK 7.3 million for

1995 as opposed to a profit of NOK 4.0 million in 1994. The total result including financial income was a deficit of NOK 3.8 million compared to a profit of NOK 7.8 million in 1994. The result includes workforce-reduction costs and early-retirement costs to the amount of NOK 6 million.

Equity is NOK 45.3 million and constitutes 49.5% of the total capital. , Liquidity was improved by NOK 6.4 million during the year and is now NOK 46.5 million. The financial profit was NOK 3.5 million in 1995, 0.3 million less than the year before.

rganisationBecause of the rapid shifts in the market trend, the company’s corpo­

rate structure must be evaluated on a running basis.

In autumn 1995 the management decided to simplify the departmental structure. Consequently, the Reservoir and Well Technology departments were combined into a single department: Production Technology. The company is thus signalling a greater comprehensive research commitment toward oil production, something the customers will deem positive. The management also decided to enhance competence in sales and marketing.

In connection with the year’s budget process, the IKU management has focused on the significance of customer relations in “the new” market. An in-house training process in developing customer relations and market plans will make the company better and more systematically able to focus on market commitment and new orders for 1996, factors that are naturally crucial to the company’s profit goal.

Project management and organisation has proven to be of significant impor­tance to the economic result. Both large and multidisciplinary projects have shown the positive effect of focussing this effort, which will be emphasised also in the future.

(I \JJ ther matters^ The company had 152 employees at the end of the year. Of those, 91

were researchers, 39 of which with doctorate degrees. Two employees received their Ph.Ds in 1995. Nine employees left the company in 1995 and four new employees were taken in.

IKU has currently six consultancy contracts with NTNU professors (NTNU: Norwegian University of Science and Technology). In connection with participation in national and international conferences, 122 papers were- presented which were written by IKU employees.

Annual development discussions with each employee is an essential element in IKU’s organisational development. In 1995 a major HES (Health, Envi­ronment and Safety) survey was conducted at SINTEF in collaboration with the company health service. That was the second time such a survey had been conducted, and the intention is to carry it out once every three years.

Absenteeism due to sickness was 3.6% as opposed to 2.9% the year before. The increase was due to two long-term absences, among other things.

The working environment committee held four meetings in 1995. IKU’s activities entail little risk of damaging the external environment. The part of the activity entailing the greatest risk is shallow drilling. However, such activities are subject to comprehensive safety regulations and controls with the aim of preventing damage.

uture prospectsIn order to enhance its professional expertise, IKU emphasised forging alliances in 1995 through strategically selected business partners. The company considered this to be the right way to develop its competence, and the year 1995 has shown that it was the right decision. The board considers this to be a development which must be continued. The structural changes in the market call for building alliances, and it is important that IKU place greater emphasis on that type of collaboration.

/ KU Petroleumforskning a.sThe company posted a NOK 3.8 million deficit for the year which

will be covered in full by its distributable reserves.

Total investments for 1995 amount to NOK 6.6 million.

IKU’s share capital is NOK 9 million. The shares are wholly owned by the Foundation for Scientific and Industrial Research at the University of Trondheim - SINTER

Trondheim, 7 March 1996

folf Prydz Chairman

Per R. Thomassen Managing Director

I Roger Sollie Rolf H. Utseth Ole Torsaeter Ole Lindefjeld

T. Kjell Roderbuig) Teqe 0yangen / Anders Farestveit Hallvard H0ydalsvik

e

Rolf Prydz Chairman

Roger Sollie RolfH. Utseth .

Per R. Thomassen Managing Director

Ole Torsaeter Ole Lindefjeld

Hallvard Hdydalsvik

i

ncome<^Net operating income

@7\Jet profit (mnok)

Operating income (MNOK) 1995 1994Gross operating income 119,398 136,828External projects 111,014 128,717Project funding from Research Council of Norway 4.884 4,047Gross project income 115,898 132,764

- Direct project expenditure -29,973 -39,725Net project income 85,925 93,039

Basic funding from Research Council of Norway 3,500 4,000Other income 0 65Net operating income 89,425 97,104

Operating expenditureWages and social expenses 63,829 61,934Other operating expenditure 16,947 17,374Rent 5,453 4,708Contribution to joint expenses SINTEF 2,615 2,755Equipment 2,220 1,653Ordinary depreciation 5,699 4,710Total operating expenditure 96,762 93,134

Operating deficit -7,337 3,970

Financial income and expenditureInterest 3,602 3,897- Financial expenditure -43 -34Net financial income 3,560 3,864

Deficit before year-end adjustments -3,778 7,833

Year-end adjustments

Adjustment premium fund 0 542Statutory reserve 0 784Free reserve -3,778 6,508

These two pages present only an extract of the full annual report which is available in a Norwegian version.

^distribution ofj gross operating income bg project duration

^distribution engross operating income by clients

Public s 23.4%\

Research Council I of Norway 1 7%

47% Programs < 2 years Industry 69.6%

Assets (MNOK)Current assetsCash, bank and post accountsBonds and other securitiesAcc. receivable, companies within the SINTEF Group Accounts receivable Other accounts receivable Projects in progress

Fixed assets Other sharesPremium fund, pension insurance Deposits, offices/laboratories Net pension fund CarsScientific equipment

Total assets

Liabilities and equity Short-term liabilitiesLiabilities, VAT, tax deductions, national insurance Liabilities, companies within the SINTEF Group Payment in advance Other short-term liabilities

Long-term liabilities

Pension premium fund

EquityCapital reservesShare capital (900 shares NOK 10,000.-)Statutory fund

Revenue reserves Free reserves

1995 1994

41,5675,000

98727,853

1,3963,520

516

1193,616

2676,791

11,308

91,632

10,291757

22,7189.104

42,870

3,492

Total liabilities and equity

32,99645,269

91,632

33,1556,989

54636,918

3,7064,682

80,324 85,996

5166,007

12900

6,16612,818

98,814

9,833724

21,37510.95742,889

0

0 6,007

9,000 9,0003,273 3,273

12,273 12,273

37,64449,917

98,814

bquihj (mnok)■s

Commissions

Servicecommissions16.4%

83.6% Research

'distribution afj emyloijees bij position

Administrative staff

Technical staffResearchers (total)of whom Dr.ing.Engineers

0 1996m

i 1ees as

Thomassen.PerR. Managing Director

(sSldminulmlion Sneen. Marit

• Andresen, Kitty Bruun• Berg-Hanssen, Harald• Bratsberg, Liv Marie• Ho, Rune• GuIdseth,Bodil• Hels0, Solfrid A Herje, Geira Johansen, Jan Helge• Lyng, Siri• Lynum, Ingunn• Mevik, Margrete• Olden, Laila S.• Pasche, Elin• Sagmo, Mette A.• Sesseng, Liva Soligard, Randi• Stoknes, Ema• Wanvik, Egil

<%x'plomtion Sandvik. Karl Oscar

a Angell-Petersen, Rolf• Austvik, Lars E.■ Borge, Hans■ Bugge, Tom■ Buland, Arild• DaMen, Kristin• Espas, Ann Merete■ Fanavoll, Stein a Possum, Berit■ Gading, Marita■ Gjertsen, Gjert Anders■ Goll, Robert M.■ Hamborg, Martin■ Hokstad, Ketil A How, 0istein■ Krokstad, Wenche

■ Landr0, Martin♦ Lind, Kristin• Lundhaug, Jorunn B.■ L0seth, Helge■ Mittet, Rune■ Monteil, Eric■ Myhr, May Britt■ M0rk, Atle■ M0rk, Mai Britt E.♦ Rendall, Hans■ Ritter, Ulricha Skjervold, Inger Lisbet■ Smelror, Morten a Sneeggen, Cecilie• Solberg, Ellen M.■ Sollie, Roger a Stene, S0lvi■ Sylta, 0yvind■ Saettem, Joar■ Tocher, Bruce A.■ Verdenius, Jacob Geert■ Vigran, Jorunn Os a Vinge, Toruna Wang, Unni Merete■ Weiss, Hermann M.■ 0stmo, Svend

reproduction <Poechnoloqij

Carlsen. Inge M.

■ Akervoll, Idar■ Andersen, Tor• Andersen, Reidun♦ Aunaas, Geir■ Baltzersen, 0ystein■ Bang, Jon• Bj0rseth, Eva Kristin■ Bliefnick, Deborah♦ Baossen, Tony■ Borud, Kristina Brandslet, Ingrid■ B0e, Reidar

♦ Finneide, Gerd B.■ Fjaer, Erhng♦ Frigard, Oddmund■ Glas0,0istein■ Haarstad, Ivar■ Hansen, Anne-Grethe■ Hansen, Olav■ Holt, Torleif■ Holt, Rune Martin■ Horsrud, Per♦ Hustad, Odd Steve■ Jensen, Jan Ivar■ Larsen, Idar■ Leith, Deborah Ann■ Leith, Leslie T.■ Lindeberg, Erik G. B.♦ Martinsen, Atle Magnus■ Mjaaland, Svein■ Munkerud, Per Kristian■ Nes, Olav-Magnar■ Nyhavn, Fridtjof■ Papamichos, Euripides■ Renhe, Lasse■ Ringstad, Cathrine■ Ringas, Jan Einara Rossing, 0ysteinTeqe♦ Sandaunet, Kurt♦ Sandvik, Jan Christer■ Schei, Grethe■ Skjellanger, Anita■ Skjaerstein, Anne■ Skurdal, Hermod■ Slotte, Per Arne♦ Solbakken, Kare■ Solheim, Arild■ Solstad, Arnea Stamnes, Lasse♦ Stavrum, Johannes♦ Stavseth, Amt■ Suarez-Rivera, Roberto■ S0nsteb0, Eyvind F.■ Torkildsen, Torgeir■ Tronvoll, Johan■ Unander, Tor Erhng

■ Vassenden, Erode■ Waag, Tor Inge• Wanvik, Hilde■ Wennberg, Kjeh Erik* Wessel-Berg, Dag a Wicks, Knut♦ 0yangen, Tetje

Environmental 'Poecknolocjij

Singsaas. Ivar

■ Aamo, Ole Morten a Almas, Inger Kjerstia Bakken, Oddveig Merethe A Berg, Toril■ Brandvik, Per Johan■ Celius, Harald■ Daling, Per Snorre• Ditlevsen, May Kristin■ Downing, Keitha Heggenhougen, Tone Aas■ Hokstad, Jorunn Nerb0 a Husvik, Leif■ Kaarstad, Inghild■ Knudsen, B0rre• Larsen, Anne■ Lewis, Alun■ Moldestad, Merete 0verli♦ Neverdal, Gunhild■ Reed, Mark■ Rye, Henrik■ Schou, Liv■ Str0m-Kristiansen, Tove■ S0rstr0m, Stein Erik■ T0mmervik, Teqe Johan

Legend:

■ Scientist♦ Engineera Technical Staff• Administrative personnel

Managing Director

Administrative support

Exploration Production Technology Environmental Technology

— Regional geology — Reservoir geology — Oil spill contingency

— Basin modelling — Experimental reservoir — Process and

— Biostratigraphy and technology environmental analysis

organic geochemistry — Reservoir simulation

— Seismic methods — Formation physics

— Logging technology

<Z=P$o<%$ o<fj hectors

Rolf Prydz, Chairman..................................................................Director, Norsk Hydro a.s.Anders Farestveit............................................................ Managing Director, SchlumbergerHallvard Hdydalsvik.............................................Department Director, Saga Petroleum a.sOle Lindefjeld............................................................ Manager R&D, Conoco Norway Inc.T. Kjell Roderburg.......................................................... Executive Vice President, SINTEFRoger Sollie..................................................................................... Research Scientist, IKUOleTorsaster.......................................................................................Professor, IPT, NTNURolf H. Utseth......................................................................................... Director, STATOILTeije 0yangen...............................................................................................Engineer, IKU

Per R. Thomassen................................................................................... Managing DirectorInge Manfred Carlsen..................................... Manager Production Technology DepartmentKarl Oscar Sandvik.......................................................... Manager Exploration DepartmentIvar Singsaas.............................................Manager Environmental Technology DepartmentMarit Sneen.......................................................... Manager Administrative Support Section

SINTEFv //i he SINTEF Group performs contract research and development for in-

dustry and the public sector. The Group has 2000 employees in Trondheim, Oslo and Mo i Rana. Our scientists work primarily in most areas of technology, but also in the natural and social sciences.

The SINTEF Group is the largest independent research organization in Scandinavia. Our activity profile is based on our vision ((Technology for a Better Society». Our task is to help ensure that our know-how is used to support a sustainable process of value adding in the community.

SINTEF collaborates closely with the Norwegian University of Science and Technology - NTNU in Trondheim. The collaboration involves specialists working together on projects, with joint use of laboratories and equipment. In collaboration with the University we function as a source of expertise of top international standard. The SINTEF Group also collaborates with the Universi­ty of Oslo.

In 1995, the units that make up the SINTEF Group had a total turnover of NOK 1.4 billion. Contracts for industry and the public sector accounted for more than 90 % of our operating revenues.

SINTEF, which is the largest unit in the Group, has its roots in the Norwegian Institute of Technology - NTH, which now forms part of the NTNU.

The SINTEF Group consists of:

SINTEF - The Foundation for Scientific and Industrial Research at the NTNU

EFI - The Norwegian Electric Power Research Institute

IKU Petroleum Research

MARINTEK - The Norwegian Marine Technology Research Institute

SINTEF Molab

The SINTEF Foundation consists of nine research institutes:

SINTEF Applied Chemistry, SINTEF Applied Mathematics, SINTEF Civil and Environmental Engineering, SINTEF Electronics and Cybernetics, SINTEF Energy, SINTEF Industrial Management, SINTEF Material Techno­logy, SINTEF Telecom and Informatics, SINTEF Unimed.