With a downturn in the Norwegian petroleum industry, what other opportunities can be found for SME supplier companies?
The harvesting of food from the sea predates the petroleum era by many centuries, and looks to have potential to regain the role as the leading Norwegian industry in terms of export value.
One objective of the Interreg Nord Process-SME project is to support SMEs seeking new business opportunities across national borders. The petroleum sector in Norway is an obvious new industry for SMEs in Sweden and Finland to seek new business opportunities. However the petroleum sector is dealing with challenges of low petroleum prices, resulting in a downturn in activity. In 2016 the Norwegian Petroleum sector employed either directly or indirectly 185 300 employees, a reduction of 47 000 compared with 2013.
Exploration and development activity is moving northwards, with ENI recently starting up production from the Goliat Floating Production and Storage platform in the Barents Sea.
Fish farming growing
Another Norwegian industry that is enjoying a better economic climate is the fish farming industry, which is also an industry that is more prevalent in Norway than in Sweden and Finland. The landed value from fish farming in 2015 was 48 billion NOK, three times that from traditional fishery, having first passed traditional fishing in 1999. It is projected that by 2050 marine value creation (seafood) will be over 500 billion NOK, and have passed petroleum and ocean transport as Norway’s most important industry in terms of export value.
Already today the supplier companies to Norwegian seafood industry have a total value creation of 23 billion NOK .
The breakthrough for fish farming came in the 1970s when the farming of salmon and rainbow trout in floating nets was achieved, close to land in the deep fjords. Already from the 1970s it was necessary to obtain a concession for operating a fish farm, and the concession sets a limit for the maximum weight of biomass the farm can contain at any time. The allocation of the concessions has also been used as a district politics tool, to support job creation in the districts. In 2015 there were 6 700 directly employed in fish farming, and over 20 000 indirectly via supplier companies. Nordland province has the largest total production of seafood products in Norway.
Seafood and fish farming innovations increasing
In august 2015 the Minister for Fishery announced a new arrangement for licences for fish farming, where innovation and technology development was central. These licences would have a faster approval process, in exchange for the results of the technology implementation being communicated to other companies in the fish farming sector. This is leading to increased innovation activity directed towards the seafood and fish farming sector, and many companies who previously focused on the petroleum sector have developed activities towards the fish farming industry.
Financing systems for seafood industry
In Norway there are several different financing systems for Research and Development and Innovation and building of networks between industries, suppliers and research providers. One system is the “Norwegian Centres of Expertise” (NCE) and of the 14 NCEs are five of them directed towards the seafood industry. Further activity is organised within three of the “Centres for Research-Driven Innovation” (SFI) which have a focus on aquaculture, as well as further activities within the SFF and Arena programmes.
One area of activity is to develop fish farms that can be placed out in the open ocean (most fish farms to date are placed in sheltered, deep fjords). The SFI centre “Exposed Aquaculture Operation” aims to develop knowledge and technologies that enable the sustainable expansion of fish farming into exposed open water areas. Because of the remote location increased use of sensors, surveillance and automated solutions are needed to be implemented.
Of the Innovation-based concessions for fish farms the first company to be awarded a concession was Ocean Farmings, who are constructing a new, modern fish farm that will in addition be the first in the world that will be monitored digitally and managed autonomously.
Ocean Farmings design combines fish biology, sensors, cybernetics and real-time mathematical modelling to achieve a low staffing requirement and efficient operation.
In addition to being technologically advanced, the Ocean Farm 1 fish farm is large – the frame is 110 m in diameter, 68 meter high and could completely enclose the Goliat FPSO oil & gas platform pictured at the start of this article. The Ocean Farm 1 will feature an integrated bridge solution, and sensors shall monitor parameters such as oxygen level, salinity, temperature, biomass density, power consumption and other environmental parameters. Important goals are avoiding stressing the fish, improved utilisation of fish feed and achieving a lower ratio of feed to weight gain. Echo sounding and hydrophones are used to monitor the position of the fish and the fish feed is released where the fish are, taking account of the ocean currents. The fish pen and nets are cleaned regularly to prevent fouling, using automated systems. Stress caused to the fish by noises from machinery such as pumps is monitored by monitoring of the fish via surveillance. Twelve different types of sensors are utilised and these have been made self-cleaning and more robust than usual, in order to withstand being underwater for 18 months. After 18 months the fish are harvested and the fish pen can be given a periodical maintenance.
Another fish farm concept has been proposed by Aker Solutions, adapting their expertise on semi-submersible oil rigs to a fish pen that can tolerate waves of 15 meter, and be placed in open water far off the coastline. To combat the problems posed by salmon lice the fish pen can be sunk below the surface where the lice thrive, and oxygen supplied to the fish via air channels.
Future-oriented business opportunities
The Interreg Process-SME project aims to highlight opportunities for new business opportunities for SME supplier companies within the process industry. Already many of the supplier companies experiencing a down turn in business from the petroleum sector due to the low oil price have turned their attention to the seafood sector, where there is identified future growth potential and need for advanced technological solutions for monitoring, automation and control.
Companies interested in more details about the opportunities within the seafood industry in Norway are referred to the linked references, or are welcome to contact the Interreg Process-SME partners.
