For over two years TFE, BP and Marathon with assistance from INTEC have been tirelessly advancing the project through engineering, procurement, manufacture and testing phases in preparation for installation. In early 2002 this fast pace will accelerate even more as installation activities commence in earnest.

PROJECT DESCRIPTION
Peak gas production of the three fields will be approximately 500 MMSCFD. A gathering system consisting of dual 12-inch flowlines will transport the gas from the three fields approximately 57 miles to the Canyon Station Platform operated by Williams located in Main Pass 261. Subsea system architecture can best be described as a "daisy chain" development such that multiple well manifolds and infield flowlines have been eliminated through the use of in-line tie-in sleds installed within the flowlines. These in-line sleds typically accommodate individual subsea wells. As a result, flowline routing is dictated in large part by the location of the wells. The flowline is routed in close proximity to each of the existing and future well locations so that the wells can be connected to the flowline in-line sleds using conventional inverted 'U' shaped jumpers. The entire 12-inch flowline system forms a "piggable loop" between Canyon Station Platform and Camden Hills. A 12-inch inverted 'U' pigging jumper located in Camden Hills ties the two 12-inch flowlines together at this location. This style of system architecture is deemed to be very cost effective for TFE and their partners.

The deepest portion of the Canyon Express flowline system occurs at Camden Hills in a water depth of approximately 7280 feet. Water depth at Canyon Station Platform is approximately 299 feet. Once installed, Canyon Express will represent the deepest production facility in the world. The Canyon Express system is designed to accommodate up to a maximum of 11 wells. The unique design of the system allows an extension of the flowline system beyond Camden Hills if, in the future, the partners desire.

CHALLENGES
Apart from the record water depth, one of the major challenges for this development was the flow assurance and operability of the production gathering system. The Canyon Express system must be able to produce the three fields under different operating regimes and varying production rates from multiple zone completions without any field taking on the performance risk of another field. Accurate flow allocation is therefore essential, which resulted in the use of subsea flow meters at each of the subsea gas production wells. This is a first in the US Gulf of Mexico.

SCOPE OF SERVICES
As part of the FEED, INTEC's scope of work included preliminary engineering of the complete subsea production system and preparation of specifications and bid packages for all equipment and services. This included subsea trees, chokes, subsea connectors, subsea valves, intervention/workover control system, subsea test tree, subsea multi-phase flowmeters, intelligent well completion equipment, production control system, ROV tooling, line pipe, coatings, supply and installation of umbilicals and installation of flowlines and jumpers.

Since the FEED completion in July of 2000, INTEC's efforts have been focused on providing assistance to TFE and their partners in the areas of flow assurance, procurement, review of contractor and vendor design and installation engineering, QC services, offshore surveys, equipment qualifications, expediting and transportation, operator training, site and functional integration testing, system operating manuals, and offshore construction.

CURRENT PROGRESS
During November and December 2001, the shallow water section (from Canyon Station out to approximately 600 feet water depth) of the two 12-inch flowlines was laid. In addition, a significant effort involving the installation of pipeline crossings has been underway and is beginning to draw to a close. As of January 2002, pre-lay survey work is underway and also drawing to a close. During January 2002, tie-in work between the flowlines and the pre-installed risers on Canyon Station Platform was completed.

Due to the very large quantity of procured equipment, expediting/transportation/logistics has been a major task requiring the coordination of multiple parties to allow for the smooth delivery of major equipment items between manufacturing facilities (located in the USA and abroad), various test sites, the project's shore base in Fourchon, Louisiana and offshore.

During January 2002, installation of the first subsea tree was completed. Trees are being installed from the drilling rig Discoverer Spirit. INTEC has been very active providing assistance to TFE and Marathon in the area of rig modifications, and overall planning and preparation for tree installation in Aconcagua and Camden Hills.

In early December 2001, a total of 351,900 ft. (107,254 meters) of main and infield umbilical was shipped from the manufacturing plant in Norway. Installation of umbilicals and the remaining portion (J-lay portion) of the flowlines is scheduled to commence during the month of January 2002. Installation of a 2 inch (73 mm) diameter steel methanol line extending from Canyon Station to the three fields is anticipated to commence during February 2002.

Scarab and Saffron are two fields in the West Delta Deep Marine Concession area located in the Eastern Mediterranean, approximately 90km offshore of the Nile Delta in Egypt. The initial development comprises 8 subsea wells at a maximum 620m water depth, tied back with infield flowlines and umbilicals to 2 manifolds located in 415m water depth. The long distance tie-back route to shore comprising two main export pipelines and hydraulic and electrical umbilicals, extends approximately 90km to connect to a new onshore gas plant. This offshore development currently represents the world's longest subsea tie-back distance to shore.

INTEC is working in consortium with Bechtel as the Deepwater Managing Contractor (DMC) for Burullus Gas Company. Burullus is a Joint Venture comprising British Gas, Edison and EGPC, the Egyptian General Petroleum Company.

INTEC is responsible for the Front-End Design, Tender Preparation, Bid Evaluation and recommendation and Project Management of the offshore managed contracts. These principally comprise:

• Deepwater subsea equipment supply, including wellheads, trees, control systems, manifolds, diverless subsea connection systems and rigid jumpers
• Infield, hydraulic and electrical umbilical supply
• Large and small diameter line pipe supply
• Installation of the deepwater equipment, umbilicals and infield flowlines
• Full EPIC of the infield flowlines and export pipelines, including mid-line PLEM

INTEC is also responsible for the ongoing Flow Assurance and Operability Design of the Subsea Production System.

The offshore development has several unique features:

• First deepwater development in the Eastern Mediterranean offshore Egypt
• A complete field development project comprising a total subsea production system and export pipeline transportation system
• The world's longest subsea tie-back development to shore
• Both shallow and deepwater development projects in one (90% of the export pipeline route is in water depths of less than 200m)
• Unique geotechnical and geophysical features in the deepwater development area
• Diverless and diver-operated subsea equipment

The DMC contract was awarded in November 1999 with an immediate start on the Front-End Engineering Design (FEED), which lasted for approximately 7 months. Tender preparation for the offshore contracts commenced before the end of FEED, and launched the year-long period of tendering, bid evaluation and contract award, during which time the project relocated to London from Houston. The first tender for the deepwater equipment supply was issued in May 2000 and the most recent tender for installation of the offshore facilities was awarded in May 2001. The offshore project's main contractors and suppliers are:

• Deepwater equipment supply: EDDC Egyptian Deepwater Development Consortium - a non-incorporated joint venture between Kvaerner and Cameron (awarded December 2000)
• Umbilicals supply: Nexans (formerly Alcatel) (awarded December 2000)
• Large diameter line pipe supply: SAW Pipes India (awarded January 2001)
• Small diameter pipe supply: Siderca (awarded February 2001)
• Installation contract: Stolt Offshore (awarded May 2001)

The current status of the offshore managed contracts is that the deepwater equipment and umbilicals supply are approximately 75 and 80% complete respectively; all small diameter pipe is delivered; and large diameter pipe is approximately 90% delivered, at the time this article is being written.

The installation contract is proceeding aggressively against a tight project schedule. The offshore construction program commenced with the beach pull on 13 October 2001. The landfall construction works are complete and the beach pull and inshore pipelay are complete, to approximately 10m water depth. Stolt Offshore has subcontracted the shore approach works and shallow water pipelay (approximately 30km) to PMS/Petrojet, the major offshore construction contractor in Egypt. The remaining shallow water pipelay will be recommenced and completed in early 2002 by PMS/Petrojet. The remainder of the pipeline installation and subsea construction works will be performed by the Stolt Offshore vessels, namely LB200, Seaway's Falcon (infield flowlines and all umbilicals), Explorer (subsea structures, flying leads and jumper installation and trenching) and Legend (survey and miscellaneous subsea construction tasks). Prior to the installation of the deepwater equipment there will be an extensive dry and wet SIT program to be performed at EDDC's sub-contractor's site in Ravenna, Italy. The wellheads have been installed as part of the Phase 1 drilling program and the trees will be installed during Phase 2 in 2002. The drilling contract is being managed by Burullus.

The offshore project is truly an international, world class project, currently operating out of 16 countries - Argentina, India, Ukraine, Norway, UK, USA, Egypt, Germany, France, Italy, Czech Republic, Sweden, Japan, Singapore, Scotland, and last but not least, Ireland! Note the introduction of a new country, Scotland, to keep our Gaelic friends north of the border happy.

The INTEC team has varied in number during the course of the project. During FEED, the team peaked at 25 people in Houston. Twelve of those transferred to London in October 2000, and the team has since grown to 25 based in Bechtel's office in Hammersmith, London. In addition, INTEC is responsible for providing QC Inspection Oversight services for the managed contracts and there have been an average 15-20 inspectors in the field at the various vendor and sub vendor facilities worldwide. A core INTEC team is planned to relocate to Egypt during the first 6 months of 2002 to oversee and manage completion of the offshore construction and commissioning phase. INTEC will also be providing the offshore vessel representatives and lead engineers to provide construction management services for the client, Burullus.

The INTEC team is led by Ernie Matchett, Project Manager, and strongly supported by Package Managers Joe Padilla (deepwater equipment and umbilicals), Tom Choate (systems/interfaces), Malcolm Blackmore (pipelines and flowlines supply and installation), Tuncer Akten (deepwater equipment and umbilicals installation), John Collins (Project Controls & Services), Lead Engineers (Robert Carmichael - pipelines; Frank Nunan - subsea structures; Mike Avedian - wellheads and trees; Wojtek Weckiewicz - SIT, ROV, intervention; Paul Shaw - umbilicals; John Ray - subsea controls; Simon Bonnell - survey and geohazards), Quality & Safety (Philippe Roelants (QC), Bob Smith (QA) and Steve Palin (Safety). The Lead Engineers are supported by Stephen Lyon (pipelines), Eric Martin (welding and metallurgy), Graham Vincent (ROV specialist), Paul Dantz (pipelines), Andy Calam and Roger Cook (systems/interface engineers).

The core team of 12 who originally transferred to London last year were created and molded by our dear departed former colleague, Mr. Bill Philliber, the Project Manager, Ernie Matchett, predecessor. Ernie is eternally grateful to have inherited such a strongly knit team and their continued strength augers well for a successful project completion for INTEC Engineering.

This article is dedicated to Bill Philliber.

In 17th century Holland, a tulip craze raged for awhile, in which great fortunes were made and lost by speculation in tulip bulbs, which had little intrinsic worth, strictly on the basis of expectations of future value. We have seen more recent examples of such tulipomania in the dot-com world, when we experienced how that craze lured many would-be engineers into a different line of business with the promise of quick riches and made our recruiting more difficult. That speculative mania ran its course and again left many with a serious hangover. In the last few months, Houston has experienced another case of speculative exuberance in which financial engineering took the place of real engineering and lost touch with reality. When someone finally detected that this emperor also had no clothes, his fall was precipitous, and many are being hurt in the process.

One could argue that people get involved willingly and should know the risks, but when companies get in the act, as in these recent events, it raises the issues of corporate governance and business ethics. Corporate governance arises because for an economic system to be successful, there have to be agreed rules and an ability of the stakeholders to rely on these rules being followed. We build checks and balances into our corporate activities so that a level of trust can be maintained. This applies to the community, the

Whereas we try to abide by such (logical) rules, I find it very disturbing that apparently these can be flaunted on a very large scale with great damage to all stakeholders. Even if this is, strictly speaking, not illegal, it is certainly unethical. The only good coming from such an occasional crash is the confirmation that in the end, short cuts don't work. Success in business requires creativity and an entrepreneurial approach; when this turns into pure speculation, it doesn't work most of the time and can be quite destructive.

At INTEC we just concluded quite a good year in many respects. Clients continued to give us their trust, and got us involved in some of the most prestigious projects around the globe. The company grew in revenue (and therefore in staff) by more than 40%. Towards the end of 2001, additional growth came by acquisition, and more such growth is planned so that next year around this time INTEC will exceed 500 staff worldwide. However, this past year we were also shocked as the world in which we operate came under attack, and I have to commend our multi-national and multi-ethnic staff around the world on the compassionate and tolerant way they responded. As a result of these recent events and current economic conditions, 2002 may not be quite as prosperous, but I am confident that our business approach will overcome also this adversity as long as we continue making money the old-fashioned way - by earning it!

W. J. Timmermans
President

Nearly all of Rio's natural attractions are found in the affluent "Zona Sul" (South Area), where the combination of almost 20km of beaches, forest vegetation and the hills is breathtaking. Great landmarks are also located in this area, like the "Corcovado" (hunchback) 700m high mountain supporting a 90m statue of Christ; the rounded rocky 400m high "Pão de Açúcar" (Sugar Loaf) mountain standing at the entrance of the Guanabara Bay, and the famous beaches of Copacabana and Ipanema.

The major downside of the city is the increase of poor class communities, named "favelas," on almost every former public hillside in Rio. Even though the favelas have their own mystique and culture, these areas remain dangerous for the public. They function as isolated "neighborhoods" where crime and drug deals are the main concern of the Rio police, causing most people to stay away. There are about 550 favelas in Rio, and they have multiplied during the last 30 years, comprising now 25% of Rio's population.

Besides the natural beauty and the favelas, there are several other reasons why this city is named a cidade maravilhosa (wonderful city), and these are the Cariocas (people of Rio), the food, the weather and the music. You do not have to be born in Rio to be a Carioca. All you have to do is relax into the city's laid-back lifestyle, and soon you will become one. Natural juices of every tropical fruit you can imagine, diversified cooking from native to foreign, and the incredible amount of different dairy products, make food a delicious experience. Samba, the Carnival beat, is still the favorite music, and you can feel that rhythm while living in Rio. Finally, weather is the baseline where you can fit everything together. Temperatures between 20 and 30 C (68-86ºF) during winter and 30 to 40 C (86-104ºF) during summer are the reasons why the Carioca does not tolerate cold weather.

In order to become a Carioca you have to learn several things. The Cariocas, from the sophisticated ones in the Zona Sul to the working class individuals in the favelas, love talking moderately loudly, having eye-contact, touching each other, watching soap operas, and of course playing, watching, and talking about soccer. Also, and very important, you have to learn that time is a flexible concept in Rio, where half an hour means "on time" for business meetings. Once you get the Carioca spirit you become a Carioca, and you may find yourself reluctant to give it back.

Bechtel (I am still amazed that this huge corporation is privately owned by the family) taught me the importance of scrupulous professional ethics, the value of personnel (and their families) to the organization, and the key role of project management techniques in the successful completion of projects. The truly great offshore pipeline engineer, Bob Brown introduced me to the excitement and challenges of subsea engineering, and his partner, George Hinkle, taught me the importance of economics and sound business practices to the continuing success of any enterprise.

Willem Timmermans and I conceived the idea of INTEC on a flight to Calgary in the early eighties. A New York investment group had acquired our former company and for us at least, it did not offer the challenges and opportunities we desired. On March 1, 1984, the four founders, Willem Timmermans, David McKeehan, Bert Schultz, and myself, along with our Gal Friday, Jan Coyle, commenced operations of INTEC at Greenspoint. We were very naive and very excited. Today we are not so naive but just as excited, or maybe more so, about the challenges and opportunities opening up for INTEC.

INTEC was initially financed by the Finnish Shipyard Group, Valmet, who proved to be a great partner (the opportunity it afforded us will always be remembered with gratitude) until the economic woes of the shipbuilding industry in Europe proved too much for it and subsequently Wartsila Marine, resulting in the four principals acquiring all the shares of INTEC. The 80's were a combination of survival and learning. We survived a major lawsuit and when the oil price cratered in 1986, in order to pay the bills we focused on joint industry and other small studies, mainly related to deepwater and offshore arctic technology development. The technology edge we developed performing these studies really paid off when the industry recovered and, as luck would have it, the Gulf of Mexico became the world's deepwater oil and gas E&P leader with Houston the focus for related technology.

The 90's, particularly the second half, was INTEC's period of extraordinary growth. One of my responsibilities was to spearhead INTEC's hiring program, and something that gave me tremendous satisfaction was to wander the halls of the Houston office and to see and talk to the personnel. INTEC truly does have the cream of the crop.

By the beginning of 2000, the partners realized that, in order for INTEC to move up to the next level and to allow those who wished a chance to exit, a sale process should be initiated. The biggest problem anticipated was to be able to retain independence to act for and on behalf of oil and gas clients, while having the benefit of substantially increased financial clout and capability to perform EPC and turnkey projects. The Heerema Group, a private corporation owned by Pieter Heerema, unequivocally agreed to this operating philosophy, and today INTEC is a division of the Heerema Group, exclusively with its own management and staff, reporting to the Group through a Supervisory Board.

At age 65, the time had come to retire and I felt the best way of closure was for my wife Mitzi and myself to make a farewell tour of the INTEC Regional offices. This was a wonderfully personal way to say good-bye to everyone at INTEC. Thank you all so very much for your warmth and giving us such great memories during our visits. Not least of all I would like to thank Willem, David and Bert for whom I have the greatest of respect and admiration as the best partners anyone could have or hope to have. You really get to know your closest associates when times are tough!

Finally, many people have come to me and said, "You are too involved in INTEC to leave, INTEC is your life, what will you do, etc..." I appreciate the kind words; however, I am reminded of other words sung by Kenny Rogers in his famed rendition of "The Gambler:"

You got to know when to hold them, know when to fold them, know when to walk away, and know when to run.

You never count your money when you're sittin' at the table; there will be time enough for countin' when the dealin's done.

Jim Gillespie