When he was young, Sun Yuanhui had the inspiration to become an engineer. The chairman of US drilling contractor Northern Offshore recalls how he admired the engineers who worked with his father, a foreman at a railway plant in Beijing, and the idea of becoming one of them took root.

Ever since, the soft-spoken Sun has devoted his life to engineering jobs, apart from three years after high school between 1975 and 1977. These he spent in a village near Beijing under a campaign launched by Chairman Mao during the Cultural Revolution.

Sun's leadership skills became apparent soon after he was appointed deputy chief of the village, where he managed to introduce businesses from Beijing.

By the time he left the village, local farmers were earning about five times as much as they had been three years earlier.

Appreciating his entrepreneurship, his seniors wanted to retain him even after he got confirmation from Tsinghua University in Beijing for a four-year bachelor programme in engineering mechanics.

Upon graduation, Sun, who was born in Beijing in 1956, was appointed assistant professor at Tsinghua and taught engineering mechanics there for three years before earning a scholarship to pursue his Masters and PhD degrees in civil engineering at Rice University in Houston, which he now calls home.

He has held a number of jobs in offshore engineering, including senior engineering analyst at Bechtel Offshore, principal in engineering, Asia Pacific’s business development director and chief representative for Noble Drilling in China and chief technology officer and group vice president at TSC Offshore Group.

He is also at the helm of Shandong Offshore Equipment, the parent of Northern Offshore (NOF) and Blue Ocean Drilling.

At Noble, he spearheaded the construction of three JU2000E jack-ups and one deep-water semi-submersible drilling rig at Dalian Shipbuilding Industry Corporation.

He worked collectively on a number of offshore projects, such as China’s first semi-submersible conversion project for the Liuhua oilfield in the South China Sea.

As the chief executive of Shandong Offshore Equipment and Blue Ocean Drilling, Sun led the strategic effort to purchase Northern Offshore in 2015 from Norwegian owner John Fredriksen.

He believes demand for drilling services will increase as companies commit to more exploration and production activity amid the oil price recovery.

Dayrates

Worldwide jack-up utilisation is around 69%, with almost 360 jack-up rigs under contract — a significant improvement over the 57% utilisation seen in early 2017 — and that has led to stronger dayrates, says Sun.

NOF currently has six newbuild jack-ups under construction at Shanghai Waigaoqiao Shipbuilding and COSCO Shipping Heavy Industry’s facilities in Dalian city.

Two CJ-46 units, Energy Emerger and Energy Embracer, were delivered some time ago and are now warm-stacked at SWS.

Qatar Petroleum recently handed Northern Offshore four-year firm charters plus options for the CJ-50 units Energy Enticer and Energy Edge for work on the giant North Field Expansion project off Qatar.

Energy Enticer is expected to start work off Qatar in April next year and the Energy Edge will start in June 2020. Sun says that he will ensure that these units are delivered “fit for purpose” as required by these new contracts.

Chinese yards have already seen signs of a market recovery, which could prompt them to sell stacked rigs at current market prices — or they can partner with established drilling contractors like NOF to move the rigs out of the shipyard and into the market, Sun suggests.

NOF is actively engaged with several rig owners in China to seek mutually beneficial opportunities to enable the rig owners or shipyards to move rigs out of the yards, while providing opportunities for drilling contractors to expand their fleets as well.

“We recognise these can be difficult decisions, but the most effective way to improve the value of the idle rigs is to contract them and put them to work,” he says.

Despite recent headways made by Chinese yards in delivering offshore projects, Sun cautions that China’s marine industry sometimes lacks long-term strategic planning.

“There remains a speculative mentality of taking shortcuts and making quick money, which affects the reputation of our industry,” he says.

He urges Chinese offshore industry players to take a disciplined approach to improve their performance — and reputation in the international marketplace.

Sun’s team is a melting pot, staffed with people from different cultural backgrounds. He says that Chinese and non-Chinese teams must recognise the importance of different perspectives and cultures, while mitigating the differences through effective communication, something he is particularly good at.

“At NOF, the strongest bond we have is an oilfield culture,” Sun says, noting that the management team comes from the contract drilling business so managers all have an intimate knowledge of the business, understand how critical it is to be focused on serving the customer and know what is required to make the business successful.

He stresses that it is by collaboration with his colleagues and support from his parent company back in China that he is able to deliver the rigs and contract them for employment.

A calligrapher, Sun has been practicing handwriting since childhood.

“Calligraphy requires concentration and eliminates impatience and irritation,” he says.

Making the strokes on paper concentrates the mind and nurtures the spirit — good exercise, he says, for the patience and attention to detail necessary for both engineering and managing business.

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