rex gaisford

Dr Rex Gaisford CBE 

After completing a PhD in stress analysis at Manchester University and a 3-year stint as a lecturer in the engineering department, Rex concentrated on, the then new field of computer-based engineering solutions. (In the 1960’s, Manchester University together with Ferranti, built and operated the largest computer in the world.)

Following this, Rex joined the computer software business CAS in London. Here he constructed for the CEGB, a digital optimisation model for the entire UK electricity generation capacity for the UK together with the country-wide electricity distribution network and all its sources of fuel (mainly fossil).   

After the successful completion of this endeavour, Rex joined RPT, a large international engineering business headquartered in London, concentrating on large scale civil/mechanical engineering design-and-build projects worldwide. At RPT, he set up and managed a computer analysis adjunct to the business. This developed digital solutions for many of the firms processes which had previously been carried out by more traditional methods. The computer-generated solutions were more accurate and were carried out much more rapidly.  In pursuit of this endeavour Rex recognised the opportunity for computer-based management tools to enable the firm to run and manage very large engineering projects. He initiated a dedicated project management division for the business which, within 5 years grew to accounted for over 50% of the firm’s fee income. 

This coincided with the birth of the offshore oil industry in the UKCS. Rex found it impossible to persuade the firm to invest in the the necessary and critical quotient of oilfield experienced staff, to tap this new business stream. The firm’s management regarded the introduction of oil industry staff to be too expensive and disruptive to the rest of the business. 

Rex resigned to contInue his career in the Offshore Oil industry: 

The new offshore Oil & Gas industry.

His first action on this new and unread path was to join the British National Oil Corporation (BNOC) where heI help the company to buy from Getty, MESA Petroleum  and then develop the Beatrice Field and its associated Nigg Oil terminal.

Immediately, Rex became a member of the BNOC negotiating team buying the field. After the purchase, he was appointed Project Manager for the Nigg Oil Terminal facility reporting to the Project Director. He was later appointed Project Manager for the entire project comprising the Nigg terminal, the offshore and onshore pipelines, two offshore production platforms and eventually, a third production platform. After his 4-year introduction to the offshore oil business Rex perceived the future prospects for BNOC to be unattractive. He therefore resigned and set up RCM Consulting Ltd. 

With RCM, he gathered a team of experienced managers and engineers with whom he had previously worked. They won a contract from Monsanto Oil &Gas to become their project team to develop their exploration success in the central NS (15/21). Rex was appointed Project Manager of their Ivanhoe Rob Roy (IRR) development. After this became well advanced with preliminary design, Monsanto was approached by Amerada Hess who ultimately purchased the entire UK offshore operation from Monsanto.

The great oil price collapse then occurred and the entire industry was flat on its back.. 

Rex saved the project by persuading the UK government to extend its Annex B completion date by one year and by persuading all of the equipment suppliers to continue to support the design effort for 1 year. This on the basis that they received just £1.00 but the company would honour the price agreement if and when the project went ahead within the 1yr time scale. He reduced the design contractors’ team by 60% on the basis that they would continue to be paid to develop the design and support the vendors efforts and reduced the operators project team.

The project was successfully restarted within the year and many of the original project staff were re-engaged.

After the successful completion of the Ivanhoe Rob Roy (IRR) field development using a then novel approach, utilising an FPSO constructed on an existing semi-submersible drilling unit. Flexible connections were made to each individual well head on the sea bed using flexible cable connection and flexible risers. IRR was completed and commissioned in record time and below budget cost. This, despite the huge disruption and the safety modifications introduced when Piper Alpha, its next, door neighbour, suffered its disaster just 6 months prior to IRR target completion.

Even before the IRR project was finally commissioned, most of the project team was reassigned to embark on the design and development of the twin platform Scott Field project. This was the companies’ most recent discovery and SCOTT had a five times larger capacity than IRR. 

The extraordinary cost of the Oil & Gas development industry in the UK when compared with other equivalent operations around the world, had become increasingly apparent. So, although SCOTT was a 500mm barrel field it was initially not predicted to be able to deliver an appropriate return on capital employed when compared to similar offshore developments elsewhere in the world. (This syndrome had prevented a number of rationalisations on IRR). The offshore industry culture had developed in low tax enabled conditions. This culture was totally embedder across the UK industry and totally resistant to change.  On the SCOTT development, Rex concluded that it was necessary to address this industry wide problem, but also recognised that such an undertaking could not be achieved in the context of one project alone, not even one as large as SCOTT.

Rex therefore invited all the oil companies who were active in the UKCS development business, to a meeting in London to address this common problem.  At this meeting, he suggested a name for this endeavour to be CRINE (Cost Reduction Initiative for the New Era). The meeting also agreed upon a methodology and adopted a target - to reduce UKCS development cost to be in line with international comparators. It was calculated that his required a cost reduction down to 33% of current levels (i.e. A 66% reduction).  This together with 12 month, target completion date for the first phase of the CRINE endeavour was adopted and a major conference in London would then be held to announce the outcome. 

Eventually hundreds of industry people working (pro-bono) were seconded to the CRINE project. It delivered its first CRINE report on time, 12 months later. The report was presented to the industry, and the world at large in the QEII conference centre in Parliament Square in front of senior politicians and leaders of all oil industry companies and their supply chains.  The event was massively oversubscribed and was dramatically successful. (It was necessary to organise a repeat event 7 days later in Aberdeen. This was also highly successful and oversubscribed.)

Within 12 months Wood Mackenzie published an independent evaluation of CRINE which showed that costs in the sector had already within 12 months been reduced by c.30%.

The SCOTT project, which was a large  (500mmbbl) undertaking involving many contractors in UK, Europe and the US and which had trialled many of the principles embodied in CRINE, was completed within a tightened budget and was precisely on-time.

In parallel with this busy work program at the centre of the Oil & Gas industry, Rex was invited in 1990 to join the Board of the UK Atomic Energy Authority. He carried out this role for the next 7 years and was instrumental in organising the the approach which the UK government and the UKAEA took to  its complex but necessary reorganisation and future strategy. 

Following the completion of SCOTT, and CRINE, Rex was instrumental in the development of many other off-shore projects for HESS and its various oil company partners and he was appointed one of three Managing Directors of the company. He was also critically involved on behalf of HESS as either operator or non-operator in all its projects across the world, including UK, Norway, Denmark, US and elsewhere. During this period, he also set up HESS subsidiaries including one in Brazil, where he advised the Brazilian government in the design and implementation of its new privatise oil industry/gas sector. 

FOOTNOTE:

Rex retired as a Managing Director of HESSon his 60th birthday. Thereafter, he pursued a consulting career. This included several independent directorships, advice to oil & gas enterprises, advice and support for alternative energy initiatives including carbon capture from hydrocarbon energy generation and many others.