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DIGITAL TRANFORMATION UNITED PHDSOFT AND SHELL AT RIO OIL & GAS 2018

Duperron Marangon Ribeiro, PhDsoft CEO, and Marcelo Mofati, Senior Partnership Advisor and Game Changer at Shell, joined Shell Talks at Rio Oil & Gas 2018 to speak about Shell Innovation Challenge. The great prize has just been awarded to PhDsoft.

PHDSOFT CEO, DUPERRON MARANGON RIBEIRO SPEAKS AT SHELL TALKS, ON RIO OIL & GAS 2018

Duperron revealed to a selected audience his view on the next steps of the Digital Transformation Era and how PhDsoft C4D Smart Digital Twin will contribute on it.

SHELL GAME CHANGER MARCELO MOFATI AT RIO OIL AND GAS 2018

Marcelo told participants more about Shell initiatives on Industry 4.0, Cloud Computing, Artificial Intelligence, Analytics and all the issues related to the companie’s Digital Tranformation efforts.


PhDsoft and Shell partnership has already been expanded to other areas of the company. Soon it will be possible to tell more about that.

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Interview: Digital wins in Brazil

Duperron Marangon Ribeiro, CEO of PhDsoft, talks to The Oil & Gas Year (TOGY) about the benefits of the company’s technology and the Brazilian market’s growing interest in digital solutions. PhDsoft’s risk management and asset integrity technology has been used in the Brazilian oil and gas industry by Petrobras and Transpetro, among others.

• On going a step further: “Some CAD software can tell you how to make your pipe or structure design to avoid interference between different lines of pipes, for instance. These products are focused on the design stage of the lifecycle of the asset. Sometimes they go to the manufacturing stage, but nobody actually goes to the stage after delivery to the client. That’s what PhDsoft is doing, and that’s why we have to have a four-dimensional model, or true digital twin.”

• On new tech: “We are going in the direction of using drones instead of inspection companies in the near future. The drones do close visual inspection with photos, and then we engage the technicians. Using artificial intelligence, you can automatically detect any damage or anomalies such as cracks or buckling.”

Most TOGY interviews are published exclusively on our business intelligence platform, TOGYiN, but you can find the full interview with Duperron Marangon Ribeiro below.

How is PhDsoft’s technology used in the oil and gas industry? 
PhDsoft is focused on oil and gas digital transformation. We provide engineering tools in the form of software. We are an engineering company and a software company at the same time, and we combine these two languages into one product.
We have a platform that delivers products for different vertical markets. Our technology is a digital twin, a predictive one. You can feed historical data into the software to predict how degradation is going to progress over time. Companies use our technology, mainly the artificial intelligence part, to foresee failures before they occur, so they can take action to avoid major issues.

What are the advantages of your C4D technology?

The market has many CAD [computer-aided design] and 3D products. Some CAD software can tell you how to make your pipe or structure design to avoid interference between different lines of pipes, for instance. These products are focused on the design stage of the lifecycle of the asset. Sometimes they go to the manufacturing stage, but nobody actually goes to the stage after delivery to the client. That’s what PhDsoft is doing, and that’s why we have to have a four-dimensional model, or true digital twin.
Assets change all the time because they degrade due to corrosion, fatigue or other failure modes. They are also repaired all the time, which generates thick inspection reports that are full of information. You can use these reports for any specific repair, but the next time you have to evaluate the structure, you are not able to use the previous inspection report. It has so much information, and even though you have highlighted points with problems, you no longer know what points have been solved because that’s not in the report.
PhDsoft has automatised that. We log every inspection and every repair, and they are automatically matched, so you can see what the current issue is and foresee problems. We integrate all this information, using historical data to foresee progress. Even when building the model itself, it’s important that it’s four-dimensional.
Take, for example, an FPSO. It’s an existing ship that has been modified and converted into an FPSO. You create new structures to hold the topsides, and because the original ship has to be returned to a good condition, you make a lot of repairs, on top of all the repairs the ship has already undergone during its lifetime. If you have the date from each document, the software can automatically consolidate the existing asset for you, despite lots of changes over time.
The other interesting part is that, software is usually an additional burden due to the feeding of data. We have made sure that the life of the people in charge of feeding the software becomes easier. When we build the inspection plan automatically, it means that people in charge of doing the inspection don’t have to make the final inspection report anymore. It’s already done.

Has the Brazilian market embraced this technology?
PhDsoft’s first customer was Transpetro, a subsidiary of Petrobras. The second was Petrobras’ exploration and production division. Afterwards came Shell, Modec and other companies such as Subsea 7.
Now, we are closely connected with Shell and we are going to do game-changing development with that company. It seems the sector is realising the gains that can be made from technology investments.
The interest in digital transformation is present in Brazil. The only thing is that specifically Petrobras, the major player in Brazil, is willing to do it internally. After all the problems the company had, it has decided to try to make most of its engineering development internally. The company is in fact using C4D right now to make life extensions for the P-38 and P-40 FPSOs. Maybe Petrobras will be willing to use C4D for the life extensions of other offshore platforms, as well.
PhDsoft made this technology much ahead of time, and we have been lucky to survive with it so far. We have a chance to progressively implement more and more features. Now the market is ready, and that’s very good.

What other new technologies will become more useful in these operations? 

We are going in the direction of using drones instead of inspection companies in the near future. The drones do close visual inspection with photos, and then we engage the technicians. Using artificial intelligence, you can automatically detect any damage or anomalies such as cracks or buckling.
You can also engage ultrasonic probes. When you get to that point, it’s absolutely necessary to have a digital twin because you don’t have access to GPS inside the tank. How can you then steer the drone to go to different places in the tank? You need a 3D model, and with laser positioning, you can check the distance to the different parts of the structure. The 3D model must be working simultaneously with the drone.

How are suppliers, such as paint and coatings companies, involved in these processes? 

Because they paint structures, companies need to check and survey. From time to time, they need to renew coatings.
PhDsoft evaluates the rust grade of the paint from photographs and we can foresee the progress of rust in the paint. We can also create paint specifications and determine how much paint is needed. The paint manufacturer could and should be involved because it can immediately quote the necessary amount of paint needed.

How can PhDsoft’s technology reduce costs and improve efficiency in hydrocarbons production? 
We create a workflow for the engineering, just as ERP [enterprise resource planning] has done for administration. In general, SAP and other ERP systems deal with administration, even though SAP handles some maintenance issues, as well. When you have this regular maintenance software, the asset is split into different parts.
When you have a large structure such as an offshore platform, you don’t have part numbers. You have to look at a 4D model, locate the problem and then manage it with your digital twin. That’s the primary difference and the reason why ERPs are not able to go further than they have today.
PhDSoft is expanding this boundary to do something similar to what ERPs do. When we make the digital twin, we can collect all the engineering elements into an information flow between the different stakeholders: the company itself, its different departments and services providers such as inspection, classification, repair, coatings companies and so on.
That reduces a lot of man hours, especially in engineering, because the process automates many of their activities. Companies can then use that time for more high-level activities. It also reduces man hours in administration and inspection. Inspectors don’t have to worry about building inspection reports anymore.
Downtime can also be reduced for ships or offshore platforms going to shipyards because they can arrive with the plates already cut. That’s less time in the shipyards and less human errors, and that reduces costs.

Is PhDsoft involved in any technology partnerships? 
IoT means integrating all information from sensors, robots, etc. Siemens is going to provide us with MindSphere, which brings all this information together, so we don’t have to worry about how to connect to specific sensors. It’s connected there, so we can take the information from sensors or robots. The only exception is drones, which we will have to connect with directly and then send information to MindSphere, because we are going to steer the drone automatically.
We also have another partnership with Dassault, which provides products that can make our technology even stronger. That company has regular CAD software – SolidWorks and Catia – but it also develops engines, some of which we are going to integrate with our technology to reduce the time to market.
We have also won the Shell Innovation Challenge and that company will provide us with the necessary resources to develop real-time data integration with our digital twin. That will lead digital transformation in the oil and gas market to industry 4.0. We are pushing the boundaries of integrity management technology a little further.

For more information on PhDsoft in Brazil, see our business intelligence platform, TOGYiN
TOGYiN features profiles on companies and institutions active in Brazil’s oil and gas industry, and provides access to all our coverage and content, including our interviews with key players and industry leaders.
TOGY’s teams enjoy unparalleled boardroom access in 35 markets worldwide. TOGYiN members benefit from full access to that network, where they can directly connect with thousands of their peers.

Source: TOGYiN (click here to read the original version)

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Study Points to Public Policies to Develop Innovation in the Oil Sector

PhDsoft was invited to join in a study that has just been released: Technological Learning and Industrial Innovation – Working Paper Series. It was made by FGV EBAPE, a renowned Brazilian Institution. The objective was to answer two basic questions: To what extent and how have companies in the Brazilian oil and gas industry accumulated technological capabilities, both for operational activities and for innovation? And how has this process influenced the reach and strength (or weakening) of industrial competitiveness?

The choice of the oil and gas sector is justified by its economic and technological importance in Brazilian industry. Oil and gas extraction and its supporting activities have a share in the country’s industrial GDP of over 10%. Petroleum and its derivatives are products of great importance in the export agenda (11% of the total exported in 2014) and oil is the main energy source used in the world and in Brazil (representing 33% and 39% of the world and Brazilian energy matrix, respectively). From a technological point of view, this industry has presented new opportunities for innovation, with overflows for other economic sectors, such as the chemical and construction industry. In addition, partnerships for overcoming technological challenges are a notable feature of the oil and gas industry.

Brazil has 6% of the world’s oil reserves, which is a stimulus factor for investments in the sector. By 2020, the total investment in equipment and services for Extraction and Production (E&P) in the country will be US$ 400 billion.

Of this sum, more than 30% will be directed to the production of submarine equipment, which shows a good opportunity of scale to develop the local productive chain. Brazil ranks 13th among oil producing countries, considering the number of barrels produced per day, corresponding to 2.7% of world production.

The study got to several conclusions and pointed to public policies that could help to develop the sector in the country: “It is important to note that the internationalization of the oil and gas industry has been a high priority in the industrial policy framework of the sector in several countries. In Norway, for example, the policy objective was to use the technological capacity developed internally for the international market, thus strengthening the growth and development of the oil cluster in the country in the long term. Today, advanced products and systems created in Norway compete successfully in the global market, including in Brazil”, concluded the study in respect of the need of support for Brazilian companies to compete in the international market.

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PhDsoft’s revenue continues to increase in a $1 trillion potential market

“PhDsoft will grow in the current oil crisis because companies are searching for ways to reduce costs without raising risks, and that’s what we do”, predicted in the beginning of the year the CEO and founder of the company, Duperron Marangon. In fact, we know now, PhDsoft’s revenues are going to end 2016 in a 30% increase. Beyond the oil crises, though, there is a potential $1 trillion market to guarantee the company success at least until 2022.

Gartner has just published the report Top Strategic Predictions for 2017 and Beyond: Surviving the Storm Winds of Digital Disruption. “Digital business innovation creates disruptive effects that have a wide-ranging impact on people and technology. However, secondary ripple effects will often prove to be more disruptive than the original disruption. Digital strategists must actively identify secondary effects when planning change”, says the Summary.

One of the Strategic Planning Assumptions of the document is that “by 2022, IoT (Internet of Things) will save consumers and businesses $1 trillion a year in maintenance, services and consumables. The key findings were that: Assets under maintenance globally exceed $240 trillion, with maintenance costs of $27 trillion; Moving to predictive maintenance (with PhDC4D, for example) can often save 10% to 20% over preventive maintenance; IoT, properly deployed, can unlock this $1 trillion savings opportunity (excluding new technology investments).

Near-term flags are: Emerging use cases demonstrating the use of IoT to drive predictive maintenance; Proliferation of digital twin models to optimize predictive maintenance efforts by 2020; Reporting of improved efficiency based on IoT implementations by 2018; Software models of physical assets provided by suppliers by 2020.

The study recommends to: Identify costs associated with scheduled maintenance and consumable expenses; Target a 10% reduction of these costs, based on a shift to a predictive regime; Build a roadmap to implement IoT projects against the portfolio, targeting the fastest returns, initially focusing on larger, more complex and expensive assets — where downtime and waste are expensive — and instrument to deliver “low-hanging fruit” cost savings, starting with POC projects that have short payback periods in order to build momentum for these projects; Continue to prioritize additional IoT instrumentation for additional cost savings until you approach the point of diminishing returns.

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An Expert Interview About Information Technology in the Oil Industry

Concluded in last June 1st, the Energy Perspectives 2016 – Long Term Macro and Market Outlook, from Statoil, begins with the following statement: “Global energy markets are in transition”. In fact, the 2008 crisis is not over yet and new technologies are promising to revolutionize the energy business, which also means lots of opportunities. This is the drive for Duperron Marangon, CEO and founder of PhDsoft: “We will grow in the current oil crisis because companies are searching for ways to reduce costs without raising risks, and that’s what we do”.

Expert in technology management and asset integrity maintenance, Marangon has been in the oil industry for the last three decades and see too many uncertainties regarding the future: “Everybody likes to talk about clean energies. I’m not different. The instant image associated to that is of a better planet. But nobody knows if this is going to be economically sustainable. Statoil Outlook, for instance, asks if cost reductions in extraction could affect the competitiveness of different fuels. There is no answer, as they analyze on the following excerpt”.

The Productivity Puzzle

Total Factor Productivity (TFP), primarily driven by labour productivity, has for several Western countries fallen since the IT boom of 1994-2004. This is unfortunate as its stimulus to economic activity has been slow and productivity gains are a necessity for a robust wage development. It seems legitimate to ask why this weakening has come about. Some of the recent new information products, such as social media, are innovative and improve people’s living standards, but do not seem to increase efficiency in the same way that the advent of PCs or the growth of the Internet did. Since the end of the financial crisis, companies have had easy access to labour and hence expanded the labour force instead of investing in technology to boost output. Furthermore, job creation has to a large extent been within low-skilled jobs in the service industry, where productivity improvement is typically low. It is also possible that companies have become more reluctant to invest in labour productivity due to stricter and more complex government regulations introduced in recent years. These regulatory efforts boost growth over the longer term, but slow the current momentum within industry and trade. Finally one might question if productivity gains are fully measured and captured in the “new economy” of e-commerce and so-called “sharing”, and in the service industry in general.

The world might have to get used to somewhat lower future productivity growth compared to recent decades, with a consequent slightly negative impact on the economic outlook. However, there will be supportive factors for productivity that could push it upwards. Reaping the full effects of the IT boom might come with a delay, as was the case with many earlier inventions, which were so comprehensive that it took years for their full impact to emerge. This – combined with the more recent drop in the cost of 3D printers and sensors, big data management, ongoing automation, and more – has the potential to transform the economy and increase productivity. Today, the world is increasingly connected and progress can spread rapidly. As labour markets in the Western world continue to tighten, putting pressure on wages, companies will have a stronger incentive to invest in training and technology, which will add support to productivity growth. Governments’ policy support, reform, and increased ability to invest in infrastructure will also be decisive for productivity in the decades to come.

“In other words, companies will not be able to keep going without raising investments in technology anymore. This is the only way to improve productivity, reducing re-work, preventing accidents and unplanned shutdowns, and so reducing overall costs. PhDC4D, our main software, has lots of cases, since it promotes more than digitalization of the whole maintenance process, but standardization. It makes everything more simple, effectively reducing costs without raising risks. As a matter of fact, it raises safety. As Statoil notices, all industries are expected to face digital disruptions in the 2020s, and will need to transition to new digital models to optimize their business”, explains Marangon pointing to another excerpt from the research.

Digitalization can improve efficiency and reduce costs, as illustrated by the progress made in the airline industry since the end of the 1990s. Sensors on planes have helped airlines realize fuel efficiency targets, maintenance and route optimization, while digitalization of sales and reservations has reduced errors and led to the “pricing and overbooking business” – where companies use big data to optimize plane occupancy. New ideas are developed as airlines understand their own data better, leading to a continuous learning journey of adapting and testing the operating model.

Brazil Oil & Gas Technology Radar

More focused in new technology and innovation, Lloyd’s Register surveyed Brazil-based oil and gas leaders, from 240 companies, between September 5 and October 3 2016, to produce Brazil Oil & Gas Technology Radar. It asked what the biggest barriers to innovation are today in Brazil, what challenges exist to the deployment of new technologies, and explored the impact of specific policies on the sector, such as the mandatory 1% levy on oil and gas production that is being redirected to local R&D. The survey also asked participants to rank a number of potentially game-changing technologies in terms of their short and longer-term impact on the sector.

Of the 26 technologies listed, respondents believed all would have some impact in the future. Distinctions were made between those that would have a high or medium impact in the short term (before 2020), medium (2020-2025) or long term (2025 or later) time horizon. Until 2020 were all incremental improvements on existing technologies: subsea robotics and other deepwater equipment advances, sensor technology such as wireless monitoring, and high-pressure high-temperature drilling.

“We’ve been investing in developments for the Internet of Things (IoT) for the last years, and our technology is ready to help the oil industry to get through the current challenges”, says the CEO of PhDsoft.

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From a hull maintenance software to an innovation platform

The use of hull life-cycle maintenance software since 1995 on 26 major Brazilian oil company tankers has reduced inaccuracies in the evaluation of ship renewal costs during dry-docking. Due to its success, the software has been redeveloped and extended for the whole floating fleet, including FPSOs and jackups, replacing regular drawings by the 3D models. While jackups’ needs are very similar to ships since they can dry-dock, FPSOs have a totally different approach with attention to corrosion being the primary focus. Past 20 years, PhDC4D has become an innovation platform that can include almost any kind of new features tailor made to companies’ needs.

Today, PhDC4D is already in use for painting and pipes of the FPSOs process plant of a major Japan company. It is also in test for the Internet of Things, both to ROVs and measuring sensors of tube thickness. Soon it will include cranes and pipelines as much as secondary equipment as an FPSO stair. “The software allowed a sophisticated data acquisition process to be applied, capturing and applying large quantities of key information thus enabling risk-based inspection to take place”, explains PhDsoft CEO, Duperron Marangon.

Results achieved

The technology incorporated into the software has been shown to reduce by 50% the cost required to renew steel on a VLCC. By extrapolating old gauging data to achieve a better mapping of the corroded areas, we were able to raise the accuracy of the forecast steel renewal figure. The client was therefore able to predict the budget required ahead of time more accurately.

We subsequently had two cases in which we helped to avoid a tanker’s repairs to continue regular operation. Due to the large amount of steel renewal that would be necessary the hulls were converted to FPSOs instead. Use of the software also allowed a ship owner to anticipate a request for classification societies to use FEM criteria to produce reassessments. This reduced by half the amount of steel renewal required.

PhDC4D allowed users to realize the poor quality of some thickness gauging reports and take actions to improve accuracy. Besides the primary applications for the software such as identifying areas of greater risk or those with higher corrosion rates, the models were also used to aid knowledge management for all structure-related issues. This replaced the existing management systems for this information. The models became the database for risk-based inspection procedures adopted by Petrobras.

The sharing of information through the software between ship and rig owners with classification societies’ consulting branches and gauging companies has been made possible through a common interface. Petrobras has hired the consulting branches of major classification societies to develop and update the many different models to assure the safety of offshore rigs including stability, hydrodynamics, FEM and degradation. For stability they developed their own software to keep a common interface for all rigs. The same approach has been used for degradation information by using the single interface provided by PHDC4D with the various classification societies involved.

There have been no major structural incidents with Transpetro tankers during the last two decades, when they have used this technology. In part this is due to a broader set of good practices being implemented such as better control of structure integrity status through the use of PhDC4D.

Technology standardization

A number of other organizations developed products with similar goals. Similar approaches have been used applying the same principle as the classification rules. These had to be standardized according to IACS common structural rules. On December 14th 2005, the Common Structural Rules for Tankers & Bulk Carriers were unanimously adopted by the IACS Council for implementation on 1 April 2006. The Council was satisfied that the new rules have been based on sound technical grounds, and achieve the goals of more robust and safer ships. IACS started then to implement the CSR maintenance program (IACS Procedural Requirement No32) via the IACS CSR Knowledge Centre (KC). All the agreed Q&As and CIs (common interpretations) are published on the IACS web site without delay in order to assist its member societies and industry in implementing the CSR in a uniform and consistent manner.

It took some time for the rules to be standardized and we believe there should not be the same delay for hull maintenance software. The sooner standards are established, the sooner the industry can benefit from a common interface. Establishing a common database format, but still requiring a user to have deal with multiple different interfaces according to the classes of their fleet, is not desirable. Ideally broader development cooperation should be realized to facilitate faster development and interface standardization.

PhDC4D as an innovation platform is mature for large-scale application. Building models and inputting data is a long-term process. Addressing differences between emerging technologies represents the next big challenge. PhDsoft has experienced these issues while the software was under development with models having to be adapted to reflect changing technology. The software development process, therefore, has to be sufficiently flexible to address evolving technology and successive model changes.

Please, contact us for more information: +1 (713) 340-9958 or phdsoft@phdsoft.com.

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PhDC4D offers investment opportunities for oil companies

This is a Remotely Operated Vehicles (ROV) integrated with PhDC4D. It was a project financed by a private company, like the oil ones obliged to invest part of its revenue in R&D, in Brazil. Last year, this obligation resulted in more than R$ 1 billion invested in projects like this. PhDsoft is looking for new partnerships.

There are no limits for what can be done with PhDC4D. The software operates in a Computerized Maintenance Management System (CMMS) category, which is like the known businesses managements ERP (Enterprise Resource Plannning), but focused on maintenance. In terms of business intelligence and knowledge management, PhDC4D is a CMMS. Its differential is that both CMMS end ERP can be resumed as an amount of tables.

In other hand, PhDC4D begins with the modeling of a structure in three dimensions, at a specific date. Somebody could think about defining it as a sophisticated CAD, but what about this fourth dimension that allows to simulate the evolution of structure along time? It results in a 4D software that can help to solve any kind of problem.

 

R&D obliged investments in Brazil

In order to expand technology to meet the integrated needs of customers, PhDsoft has traditionally built partnerships with big players of the oil sector, like Petrobras. These partnerships has resulted in a sort of new features such as the ROV integration.

This project used PhDC4D’s technology to manage the hulls and keep track of the maintenance of an offshore platform´s operation integrity by using the exact location of the data obtained by robots in real time.

The best news is that, although it has international headquarters in Houston, PhDsoft’s development teams continue to be coordinated by its unit In Brazil. This means PhDsoft is still a Brazilian company an so can be considered eligible to the demand for national content for the R&D investments oil companies are obliged to make in the country.

 

Internet of things

Last year, the Brazilian National Agency of Petroleum, Natural Gas and Biofuels (ANP) has changed the rules for these investments. From now on, 10% of the revenues must be invested in Brazilian companies other than the one that originated the revenue, like PhDsoft.

In the first three months of 2016, almost R$ 150 million were generated for obliged investments in R&D by oil companies operating in Brazil. In 2015, the amount reached more than R$ 1 billion. The deadline for the investments related to 2016 ends at June 30th 2017.

The next generation of projects PhDsoft is preparing intends to enroll everything related to maintenance in one only solution: static and submarine equipments, pipes, risers, structures and secondary structures, cranes, among others. One goal is to make it all ready to the internet of things. The objective is to integrate PhDC4D with sensors like the ones inserted in pipes to measure corrosion taxes or the ultrasonic thickness and strain gauges.

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C4D software helped a client save US$ 400K

A container ship suffered bottom damage due to grounding. Two shipyards were contacted to evaluate the damage and provide repair estimates. But the estimates of the amount of steel required for repairs varied by 40%. An accurate assessment of the actual extent of damage extent and required repair material was urgently needed.

The case is real and happened to a PhDsoft client, a major company that operates ships in Brazil. In a few hours, using the repair tools of C4D Software®, the steel requirements were recalculated, showing that actual repair needs were 61 tons of steel, 60% less than the high estimate. It was clear that the shipyards significantly overestimated the amount of steel to be replaced.

Considering the cost of steel renewal in local shipyards of $11K/ton, the result was a saving of $400k. With the actual figure at hand, the client could safely and confidently select the shipyard with lower price and avoid the risk of the scope of materials increasing during repair execution.

“Without C4D Software we would have been forced to blindly follow the quotation of the shipyards with no control over the situation. Without C4D we never would have received the accurate numbers in time to make the right decision. The calculation of steel renewal done by C4D Software is more accurate than the shipyard because it takes into account all the original thicknesses”, stated the company.