OGIQ Modular Construction

How Modular Construction Can Help China's Oil & Gas Industry

Tim Haïdar
Posted: 02/11/2013

Modular construction - the process of completing different sections of a building offsite before bringing the components together to form a finished structure - is a relatively new industry approach that brings many benefits.

One of the primary advantages is fast delivery, which was recently illustrated by a hotel development project in China's Hunan province. Using 200 workers, Broad Sustainable Building erected a prefabricated 30-storey tower in just 15 days.

Such efficiency is invaluable for any industry, particularly one with massive potential for rapid growth, such as China's oil and gas sector.

A Booming Industry

China's oil and gas industry - like many of the sectors that comprise the Asian nation's thriving economy - has experienced strong growth in recent years and is on course for further expansion in the foreseeable future. This is likely to generate many development opportunities where modular construction practices could flourish.

According to the National Development and Reform Commission (NDRC), China's total natural gas consumption will be approximately 230 billion cubic metres per year by 2015, by which time supply capacity is estimated to exceed 260 billion cubic metres.

As well as importing gas, the country will pursue domestic development of unconventional sources such as coalbed methane, shale gas and synthetic coal to gas conversion.

Liu Tienan, deputy director of the NDRC, said strategies are in place to increase the supply of resources, speed up pipeline networks and build import terminals for liquefied natural gas.

Specific objectives for 2013 include infrastructure construction and ongoing development of domestic resources in the Sichuan and Ordos basins.

Another goal is to support progress in the shale gas market. National Geographic published a report in August 2012 focusing on the current situation in Chongqing in Sichuan province, where hydraulic fracturing rigs were assembled to drill into one of China's first shale gas exploration sites.

Born in the United States, hydraulic fracturing, or 'fracking', is the process of extracting natural gas and other substances by drilling into source rocks such as shale.

State-owned oil company, Sinopec, started work on the first of nine planned shale gas wells in Chongqing last June, with the aim of producing up to 500 million cubic metres of natural gas by the end of the year.

China's goal is to serve six per cent of its total energy requirements with shale gas by 2020.

Another region of great potential for the nation's oil and gas industry is the South China Sea, which could be the source of 15 billion cubic metres of natural gas a year by 2015.

The sea is rich in both oil and gas but has prompted territory disputes between China and neighbouring countries such as the Philippines, Vietnam and Malaysia.

How Can Modular Construction Help?

An industry with such ambitious plans and such potential for growth needs the most efficient practices and strategies to succeed.

The advantages of modular fabrication and construction are manifold and relate to the company behind the development, workers and the building site.

One of the biggest benefits for the company is speed, as separate components can be made simultaneously at different sites before being brought together. This reduces the risk of being hampered by factors such as inclement weather or delays that could bring a project to a halt if all work is taking place in a single location.

There are also cost advantages, as a shorter project timeline means reduced labour requirements.

Engineering, procurement and construction company CB&I claims to have pioneered modular fabrication and building of process plants and components more than 30 years ago.

The guarantee that work will be carried out to strict standards, under controlled conditions, is one benefit of modularisation, according to the firm. Another advantage is the reduced risk of fitting errors and need for reworking, as components can be pre-fitted prior to shipment.

In environmental terms, modular construction minimises a project's impact on a chosen site and keeps the lay-down space as small as possible.

For the labour force, the approach improves safety by reducing the need to work at height and allows workers to get on with their jobs without worrying about environmental complications and delays.

Modularisation can benefit various sectors around the world but could be particularly valuable for oil and gas in China, a country whose support for heavy industry has helped build a strong economy that is on course for further growth in the years to come.

Tim Haïdar
Posted: 02/11/2013

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