IKM's renewable strategy

How does IKM prioritize renewable energy projects amid an all-time boom in oil and gas?

Karianne Skjæveland
Communication Manager
January 27, 2023
Offshore wind

The IKM Group aims to be the largest, most competitive and most complete service provider in the energy sector. How do they prioritize renewable energy projects amid an all-time boom in oil and gas?

Deputy CEO of IKM Group, Øystein Stjern, delivered an engaging service-industry perspective on the challenges and opportunities of the energy crisis during an Energy Transition Norway cluster event in December last year. We asked him for a follow-up interview to learn more about how IKM Group understands its role in the renewable market, and what its renewable strategy is.

– Our approach is to take our 30 years of experience with operation and maintenance from the Oil and Gas industry and continue to build on it while we develop business in offshore wind, hydrogen, CCS, and other activities. We will do that through organic growth, strategic acquisitions, or active involvement in companies, explains Øystein Stjern.

IKM Group, which has a budgeted revenue of 5,2 billion NOK for 2023 and currently employs approximately 3000 people, has done a thorough internal competency assessment to establish where its competence and services fit into the offshore wind value chain.

– That competency assessment has been very useful. It shows us that offshore wind stands out as an area where we’ll be able to employ many of our people, says Stjern.

Carl-Johan Almestad, SVP of Business Development Renewables at IKM Group, elaborates:

– Asset lifetime extension, through specialized maintenance services, is what IKM does best. Let's take the electrical power production and distribution system for instance. Here are the same technical disciplines required when doing work on the drivetrain (gearbox, generator, supporting systems) whether it’s up in the nacelle of the turbine or under the deck in the engine room on a platform. When having a solid understanding of the fundamentals, our technicians will quickly adapt to new working procedures or any OEM-specific course requirements, he explains.

By having individual companies that keep two thoughts in their minds simultaneously, the IKM concern aims to keep people employed within their existing business, while balancing it strategically with investments in renewable energy and preparing for the transformation that comes.

How does IKM prioritize renewable energy projects amid an all-time oil and gas boom?

– We organically shape our organization towards the renewable market and aim to use clusters such as Energy Transition Norway strategically to do just that. We are making strategic acquisitions to support our efforts toward the renewable market. We have certain projects we invest in as industrial investors and others where we engage on the operational side, says Stjern.

Two good examples are Flex2power, and WindSpider, both being cluster projects in the portfolio of Energy Transition Norway.

– Flex2power and Windspider are technologies that we find quite radical and that we chose to invest in as part of our long-time renewable strategy. Flex2power is so diametrically different from other technologies, so we went in and funded the development of that as an industrial investor. With Windspider we’ve been more hands-on with engineering tasks, Stjern explains.

The deputy CEO describes both concepts as extremely exciting but underlines that the company will have to be patient for the financial rewards.

– You’ve got to participate in the renewable energy race – otherwise, you will be left behind. This is however challenging for two reasons. First, the money is not there yet. The return on investment lies years ahead. Secondly, we fear that the cost of manpower will increase too much in the coming years because an awful lot of capacity for traditional oil and gas activities will be seized in this region over the next 4-5 years. Unemployment is currently at a record low, and it's only going to keep decreasing. This might lead to companies outbidding each other to secure resources for their current projects.

– We might also see that the high activity within traditional O&G will seize resources that could have been used to shape the renewable boost. The industry’s ability to prioritize renewables in addition to profitable oil and gas projects will have a major impact on the future, says Stjern.

The deputy CEO is hopeful, however. He believes the industry is significantly better rigged for collaboration today and gives cluster structures like Energy Transition Norway much of the credit for creating meaningful arenas which allow operators to come together and establish a common understanding of reality.

– What does membership in clusters like Energy Transition Norway mean to IKM?

– Energy Transition Norway is an excellent arena for us to establish relationships and acquaintances with significant players while providing insight and opportunities to participate in projects. I believe that clusters like ETN can help avoid siloed thinking during this period when we have the challenge of securing renewable projects during a period when this region will have high activity in oil and gas.

– The clusters help connect us even closer to the energy transition process. Our goal is to ensure that we maintain the level of activity within our traditional business while at the same time growing within renewables. To do that, we need to understand more about what the needs will be in the future, and how we can use the expertise we have in a renewable market. The clusters give us access to a wide range of players in the industry that are useful for us to discuss with, both on the customer and the supplier side. Energy Transition Norway has an impressive range of heavy industry players, and it is impressive what you’ve managed to do in a relatively short time.

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