The Journey of the Self-Propelled Jackups From Liftboats to MODUs


In recent times, a big migration of self-propelled Jackup barges has taken place from different parts of the world to the Middle East. This started when the oil prices crashed in 2013 and the owners of these versatile vessels in different parts of the world found themselves with lesser and lesser options for their fleet. The Middle East remained the only ray of hope amidst an almost universal gloom. The reason why the Middle East continued to perform better than other regions is that, driven by wise leadership, despite the drop in oil prices, the National Oil Companies (NOCs) in the region continued to operate with an attitude of ‘business as usual’ thus keeping at bay the financial panic that gripped the rest of the world. This strategy of staying calm helped avoid unnecessary panic and keep things ticking, at least at the critical juncture. Later, once the universal wave of panic had subsided, the NOCs in the region decided to put on hold projects thereby controlling spending. As expected, by that time, thanks to the prudent handling of the global oil crisis by Middle East leaders, especially UAE, the strategy had already had the desired result. Markets moved in a controlled manner and the Middle East came through with shining colours.

Faced with the challenge to manage operations at an ever-increasingly tight budgets in light of the fall in oil price, coupled with the global financial crisis the oil majors – especially NOCs in the region – started to examine cost-effective alternatives as opposed to the traditional way of doing things. This led to the resurgence of the self-propelled jackup barges! These extremely versatile, agile offshore units were the perfect answer to the demands of price-sensitive oil companies. Moreover, there were plenty of them around. But what was not known to the oil majors – and probably still remains relatively unknown was that among the swelling numbers of offshore units, not all units were the same. Some were ‘Liftboats’ and others were ‘MODUs’. Seen externally these units seem similar but nothing is farther from the truth. While it is true that the self-propelled Jackups built to MODU standards has its origins in the humble Liftboat, the modern Jackup vessel of MODU design is far removed from its past.

Change comes with a price

All that was set to change in 1985 when the tropical storm Juan hit the Gulf of Mexico. As the storm churned for days in the Gulf, looking to destroy all structures in the Gulf, the frailty of the Liftboats hit home. A lot of the Liftboats made it back to safety but a good number perished at sea. This loss of life and property forced the authorities to sit up and take notice. Literally thirty years after the first Liftboat started work for the oil companies, questions began to be raised and the industry found itself being pushed towards growth of a kind it was not ready for. But the task was difficult. Interested parties, builders, Liftboat owners all jostled to try and influence the regulators because no one was ready for the change.

Present times

Today, the world is better off, but surprisingly not by much. Even today, a large population of the ‘early boats’ continue to operate and the sad fact is that oil companies who charter these vessels remain largely unaware of the difference between the ‘Liftboats’ and the Jackup Barges built to MODU requirements.

A liftboat constructed before the rules came into force, does not comply with a suite of regulations. Typically, the “liftboats” cannot stay elevated on location in very rough weather. Some would say that this makes the Liftboats a ‘Hit-and-Run’ type of unit. That may be an exaggeration of sorts, especially in the Arabian Gulf, where the weather is considerably more benign compared to other parts of the world, but it is a fact that the older Liftboats cannot sustain marginal weather.

What the future holds

It is always a challenging exercise to predict what the future holds. In fact, that is akin to the proverbial crystal ball gazing. But nevertheless, it is an exercise we have always undertaken – and always will. We always want to guess what the future will require because that is what decides our actions of today. The recent financial crisis changed the mindset of the oil industry. When the oil prices dipped, the oil majors battened their hatches and waited for the storm to blow over. But the stormy times lasted longer than anyone could foresee. Consequently, austerity measures adopted by the operating companies assumed proportions never seen before. Even today the same players are busy jostling with one another to beat down the costs and demand services at prices that are barely remunerative.