Local company claiming oil company subcontractor not following the rules
Jim Hynes, with Sea-Force Hyperbaric Inc., stands inside the state-of-the-art Mobile Hyperbaric Reception Facility at a grand opening at Newdock in St. John’s Wednesday.
— Photo by Rhonda Hayward/The Telegram
The company Subsea 7 has been tasked with engineering and installing underwater connections, risers and flowlines at the Terra Nova oil field. Its work requires deep-sea divers.
The $100 million in local work was celebrated, when announced earlier this year, but a local company has now come out swinging — claiming it is not being given “full and fair opportunity” for a subcontract with Subsea 7 as it completes tasks at Terra Nova.
Sea-Force Hyperbaric is still in its infancy, in possession of a hyperbaric reception facility for deep divers. The facility is stationed in a building at the NewDock yard off Water Street, near the St. John's waterfront. It is prepped to take 18 divers for decompression at a moments' notice — in the case of a catastrophic incident offshore.
The company has at least one stand-by contract under its belt, but says its attempts to discuss a potential contract on Suncor Energy’s subsea work have been rebuffed.
“In the case of Subsea 7 and its campaign for Suncor Energy we have been ignored, our correspondence has not been acknowledged, and we have been subject to blatant disregard by Subsea 7 of their benefits commitments to this province and the supply community,” states a letter written and signed by Sea-Force Hyperbaric directors Jim and Barry Hynes, sent to Sandy Martin, a vice president of Suncor on the east coast.
The letter was forwarded late Wednesday afternoon by email from Sea-Force Hyperbaric to a list of political representatives, regional oil company leaders and reporters.
Speaking with The Telegram this morning, Jim Hynes acknowledged his company did ultimately receive a response from Subsea 7 to its inquiries around a potential contract, as outlined in the letter.
He said the response was “dismissive” and claimed the company turned down Sea-Force Hyperbaric’s services by citing a lack of prequalification as a contractor, without offering an opportunity for such an evaluation.
“They just ignored us, for months,” Hynes said, of attempts to enter into discussions with the company and have the Sea-Force Hyperbaric operation evaluated.
Subsea 7 and Suncor representatives have seen the Sea-Force Hyperbaric facility, he said, but have not performed any kind of detailed audit, as would be required for a potential contractor.
Hynes clarified that Sea-Force Hyperbaric is not demanding to be awarded a contract, but is arguing it has not been given fair consideration for use as a stand-by facility for divers.
“In the case of Subsea 7 and its campaign for Suncor Energy we have been ignored, our correspondence has not been acknowledged...” — Jim Hynes and Barry Hynes, Sea-Force Hyperbaric, in letter
“Suncor is confident in the proven capability of the contractor Subsea 7 — who is a global leader in its field. The company has the people, processes and equipment to execute the program with safety as the top priority, and meet all of the needs of the project including hyperbaric capacity,” stated Suncor Energy spokesman John Downton, in a written response to the accusations.
“When considering new services and suppliers Subsea 7 has a thorough due diligence process intended to ensure that potential contractors have the processes, procedures, equipment and capabilities to safely provide the services offered. Prequalification is an essential first step in that process — which in this case was not completed,” he stated.
He added Subsea 7 has proven equipment on standby in the case an incident offshore. It is the same employed by that company for fall 2012 and winter 2013 work programs.
In a statement to the media, Subsea 7 says its standby for emergencies involves certified equipment aboard the project vessel Seven Falcon. As for the complaint of Sea-Force Hyperbaric, the company responded as follows: “Subsea 7 recently assessed prequalification submissions for the provision of hyperbaric reception facilities to support the 2013 offshore work program for the Terra Nova Project. Following its due diligence process, which aligns with internationally accepted standards, Subsea 7 determined that the submissions did not meet requirements, and potential suppliers were therefore not successful in the prequalification process.”
Meanwhile, the president and CEO of the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB), Scott Tessier, was copied on the letter from Sea-Force Hyperbaric. Disputes over the “full and fair opportunity” provisions for local contractors fall to the offshore regulator.
The board is expected to provide an initial response to the Sea-Force complaint later today.
This is an updated version.