Offshore bug bill hits £1bn

Several key North Sea suppliers have failed to make adequate provision to stop the millennium bug from seriously disrupting the operations of oil companies, a senior industry figure warned last week. Ian Smailes, chairman of the UK Offshore Operators’ Association (UKOOA) Year 2000 Taskforce, said the suppliers concerned will have to take urgent action or […]

Several key North Sea suppliers have failed to make adequate provision to stop the millennium bug from seriously disrupting the operations of oil companies, a senior industry figure warned last week.

Ian Smailes, chairman of the UK Offshore Operators’ Association (UKOOA) Year 2000 Taskforce, said the suppliers concerned will have to take urgent action or face losing business.

Supply companies will have to account for the greater part of the £500m-£1bn UKOOA believes the oil and gas industry will need to spend to address the Year 2000 problem. The bill for its members will be just over £100m, it estimates.

One large offshore contractor has already spent £10m upgrading its IT system.

However, most of the 120 key suppliers examined by the taskforce, set up in mid-1997, are ‘well on track’, Smailes added.

UKOOA is switching its attention to core suppliers of equipment and services. Members have completed remedial action on systems identified as having a medium to high risk of causing a ‘material disruption to business continuity’.

Dr John Wils, UKOOA’s director of operational and technical affairs, disputed a US consultant’s recent claim that there was a 15% chance of computer failure disrupting North Sea supplies after 2000, but declined to give his own figure. He said the industry was doing a lot of work on contingency planning to fight the bug.