INEOS Oil & Gas – Marine PSV Sharing Solution

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Problem Statement  

The PSV spot market was not an economic solution for INEOS’ Normally Unmanned Installation (NUI) support  – The challenge was trying to share other Operators’ PSVs with production assets when the time on a NUI platform is limited.

Aims

The aim was to work closely with other local operators who had PSVs on charter and who were willing to collaborate on a workable solution while sharing goals and expectations.

Method

INEOS identified an Operator with spare capacity on its chartered PSVs and logistics teams worked closely to set out a flexible sharing agreement without onerous terms and with an element of trust.

Impact

The INEOS logistics team works closely with the other Operator’s marine coordinator in the field to communicate the requirements of INEOS’ platform(s) and activities on a day to day basis  ensuring INEOS works within their sailing plans. Good communication mitigates the impact of schedule changes with enough awareness of each others operations. Throughout the first year of the agreement, the operational & cost benefits of such a flexible sharing agreement have enabled INEOS to manage the requirements and demands of a NUI without an INEOS chartered PSV.

Total Savings Anticipated

20%

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Peterson – Breaking down the silos, multi-skilling and redesigning the way we work

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Problem Statement  

The pressure on the O&G Industry to reduce prices continues. There is a limit to how much cost can be driven out through a standardised approach. Through changing the way we think and changing the methods of working we found ways of reducing cost, working in partnership with the client, implementing new technologies all of which led to a competitive and sustainable advantage.

Aims

  • To change the mindset and move away from the silo mentality and create a multi-skilled workforce where individuals have the ability to work in any area of the business.
  • To redesign the daily operation surrounding Receipts and Dispatch, Returns and Repairs, Kitting and Staging.
  • Site refurbishment to improve staff welfare
  • To improve HSEQ performance and raise awareness

Method

  • Effective communications through Town Halls, staff engagements and workshops to promote a different way of thinking which clearly evidenced the changes in the industry and the need for each individual to think differently.
  • Redeployment opportunities offered mitigating any need for redundancies
  • Deployed a skills matrix to understand people skillsets and where gaps existed.
  • Encouraged and promoted individuals to learn other areas of the business enabling resilience and flexibility to managing demand.
  • Eliminate multiple handling and waste through optimising the process. Focus on internal and external traffic management plan with a view to minimising traffic, plant movement and general improved layout.
  • Daily / Weekly / Monthly focus on HSEQ with management participation

Impact 

People have understood the need for change and to achieve sustainability and longevity we needed to think and act differently, a move away from old traditional silo ways of working. Individuals are now multi-skilled and have the ability to move from one department to another during peaks and troughs of activity.

The warehouse layout has been redesigned and the process of receipting and dispatching changed so that material is now only handled once before it is physically dispatched, stored, bagged and tagged. In addition, visible marking of floor areas, platform laydown areas, visual control mechanisms has been introduced helping counter potential human error.

HSEQ performance and awareness has improved.

Improved motivation and team spirit despite the significant changes.

Achiever of the PETERSON Operational Excellence award 2017

Total Savings Anticipated

£250,000

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Shell – Logistics/Material Management optimisation Initiatives

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Aims

To provide a summary of some of the initiatives Shell has been involved either as a participant or leading with other O&G operators and our key suppliers.

Initative overview

In the last 5 years, the Logistics Fit for Future (FFF) journey to date has involved a re-thinking of the way in which we work internally and how we collaborate externally with the rest of the supply chain.The total Shell Logistics cost has decreased by a factor 2 thanks to the following initiatives:

    • Internal: review fit for purpose specification for vessels, aggregate demand into integrated planning for Projects, Wells and Production helping to improve Logistics asset utilization
    • External: sharing agreements in place for Marine (ERRVs and PSVs), Aviation fixed wing and Warehousing with other O&G operators.
    • Contracting: develop further output based contracting with fair risk allocation and performance incentive scheme.

Impact/Discussion points 

The challenge is to bring collaboration across the industry to the next level under the banner of ETF Logistics. The following initiatives will be pursued among others:

UKCS PSV marine pooling

Program to reduce Logistics GHG emissions including LNG bunkering

Technology – Digital supply chain – now starting to replicate best practices from other Shell operating units and implement in UK. It will include Track and Trace and End to End Supply Chain Visibility.

Systematic value/waste mapping to instil a culture of continuous improvement and holistic thinking across the supply chain

Total savings achieved

50 mln USD

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BP- Integrated SIMOPS tool improves understanding of risks

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Impact

The use of a visual reference for each activity taking place improved the team’s understanding of potential risks and hazards. It also provided a clear identification of the limits of each work scope within the work area, as well as detailed information by clicking on the activity (colour coded by function).

Description of Best Practice

BP and partners are currently investing at significant levels in the ETAP life extension project (ELXP) to secure the future of the field until 2030 and beyond. The safe and effective management of simultaneous operations (SIMOPS) between the ELXP project and the ETAP asset was a critical part of project delivery. To assist with this, the team introduced a new software system called ‘Blue-Beam™’ which allowed the project to introduce multi-layer PDFs showing work activities by function. They also utilised ‘Return to Scene’ (R2S) technology – a virtual ‘Google-style street view’ survey of the plant – which allowed functions to survey and tag sections of the asset that were planned to be addressed during the intervention, whilst also enabling participants at SIMOPS sessions to visualise the worksite in 3D.

Contact: Stephanie McHardy, BP
stephanie.mchardy@bp.com

Nexen – £500,000 saved through efficient induction of “Green Hats”

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Submitted by Nexen Petroleum U.K. Limited

Impact

  • Nexen Petroleum U.K. Limited reduced non-productive time associated with “Green Hats” inductions by 11% – saving approximately £500,000.
  • Improved safety on the platform and enhanced business continuity with experienced personnel returning to do work on the assets.

Description of Best Practice

Nexen set out to reduce the productive time lost through the volume of inductions for personnel unfamiliar with their North Sea assets – otherwise known as “Green Hats”.

Ensuring the safety and wellbeing of the workforce is central to Nexen’s core values and culture.  Workers across all platforms receive a thorough induction, welcoming them to the installation and preparing them for their role onboard. This includes safety training specific to each platform, together with an understanding of the company lifesaving rules and culture, before embarking on their job. This induction is mandatory for personnel who are not platform familiar or have not been on the platform within one year.

Each induction session involves an average of 19 hours of training and support which includes approximately;

  • 8.5 hours platform familiarisation for each “Green Hat”
  • 2 hours induction session by core crew
  • 8 hours of core crew  support and shadowing as part of permit to work duty
  • 30 mins attending Offshore Installation Manager’s evening brief

When Nexen analysed the process, the company discovered the planning behind inductions could be tightened up and run more efficiently – and calculated that over 57,000 hours had been lost in 2014 through Non Productive Time.

Nexen recognises the value and skills which new personnel bring to it operations and encourages trainees and new-starts to it assets, and does not discourage this practice. For improved efficiency, requests are made to contractors that when an experienced person is being mobilised, a check is carried out to see if they are platform familiar and if they have been on the platform within the last 12 months.  This decreases the number of one-trip personnel to the assets.

Overall, this has resulted in improved safety to the platform and enhanced business continuity with the experienced personnel returning to do work on the installations.

A number of steps have been introduced to support this initiative, which range from reviewing the trip history of all personnel travelling offshore, planning workscopes around securing platform familiar personnel where possible, and the introduction of “Green Hat” figures within contractual KPIs.  This approach is encouraged across every department in the organisation, onshore and offshore, no matter how big or small the task.

As a result of this initiative, in 2015, Nexen reduced non-productive time associated with “Green Hats” by 11% and has saved approximately £500,000.

Contact: Ray Riddoch
tracey.miller@nexencnoocltd.com

Nexen – Driving greater efficiency of platform supply vessel fleet through controlling offshore non productive time

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Submitted by Nexen

Impact

  • Focus on reducing offshore Non Productive Time (NPT) has enabled Nexen to challenge the manner in which it operates its Platform Supply Vessel (PSV) fleet and change entrenched ways of working.
  • Resulted in the reduction of PSV fleet by one term vessel and reduction in dependency of ad hoc spothires.
  • Resulted in annualised savings of £3.5 – £4 Million.
  • Further improvements to vessel sailing schedules have the potential to reduce PSV fleet further, saving an additional £1.25 – £1.5 million per annum
  • Vessel savings have been a major contributor in improving Nexen’s lifting costs in 2016

 Description of Best Practice

Nexen’s efficiency drive to controlling ‘dead time’ in offshore vessel logistics has resulted in annualised savings of £3.5 – £4 million and has been a major contributor to improving the company’s lifting costs per barrel in 2016.

The successful initiative has also reduced its PSV fleet by one vessel and lessened dependency on ad hoc spot hires.

In 2015, Nexen embraced the concept of ‘Marginal Gains’ across its UK operations.  The theory is derived from small percentile changes resulting in significant improvements in overall performance.  The marginal gains approach was applied to improvements in the efficiency of offshore logistics, as this is a high cost area for the business.

Prior to this, offshore logistics involving the delivery of equipment, plant and materials from suppliers to  offshore installations, was seen as a tactical activity and little analysis was done on measuring or optimising the efficiency of vessel activity or indeed fleet size.

The business began to explore how it could manage these costs more effectively and initiated increased analysis and understanding of the causes of NPT. This NPT became a key business metric and the leadership team set a stretch target of reducing logistic NPT to below 30% in 2015.

This challenged the offshore teams into placing greater emphasis on planning and scheduling to ensure the PSVs were working more efficiently. Within four months, the target was reached and proved to be sustainable throughout the year. Building on this success, vessel NPT metrics where also examined in conjunction with PSV deck utilisation and port NPT, which demonstrated that further cost management improvements could be implemented, including vessel sharing and ultimately reducing the PSV fleet.

Nexen’s logistics team continued working collaboratively with the onshore asset support teams and offshore teams to develop a revised sailing schedule, based on sharing PSV sailings between Nexen’s Buzzard and Golden Eagle installations.

In January 2016, the vessel sharing was implemented without any disruption to operations and enabled Nexen to reduce the PSV fleet from four vessels to three. At this time, further refinements to the vessel sailing schedules are also being considered to include other Nexen installations. This has been a great example of using high level metrics to challenge engrained behaviours and encouraging greater teamwork to deliver efficiency improvements.

Contact: Granville Clutterbuck
Granville.Clutterbuck@nexencnoocltd.com

 

APSYS- Sparing optimisation of a network of compression stations

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Submitted by APSYS

Impact

The customer was provided with the following results:

  • Reduction of sparing at 23 out of 24 compression stations; at one location savings of €1.2M were identified;
  • Availability risk identified at one location resulting in a requirement to increase sparing;
  • A 35 per cent increase in sparing at the central warehouse to provide better network support; and
  • An overall stockholding cost reduction from the M€9.6 to M€2.4 i.e. a reduction by 75 per cent.

Description of Best Practice

Context: A multi-national Oil & Gas service provider into the energy industry operates a network of pipelines and gas compression stations. The customer had requirements to optimise sparing from a cost point of view whilst preserving current levels of availability for this network which comprises 25 sites (gas compression stations, supported by a centralised warehouse facility).

Approach: The study has been carried out in a two-stage approach.First we assessed the logistical readiness for both localised and centralised sparing, using existing data.

The availability was determined by creating a model based of the system and supplied information, along with a snapshot of the inventories at all 25 locations. In the second stage, the model was run to identify opportunities for cost and stockholding optimisation across the entire network, whilst maintaining or improving the existing availability levels. SIMLOG is a software tool which helps to optimize type, quantity, and location of Logistics Elements for one or more repairable systems. This tool has been applied in other industries (Aerospace, Defence, Railway) and tested /validated in the UK by the MOD. It can also be linked to the CMMS (SAP, Maximo) for real time availability analysis.

Contact: Pierre Secher
pierre.secher@apsys.eads.net

ConocoPhillips – Making logistical efficiency improvements

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Submitted by ConocoPhillips

Impact

As a result of collaboration on all of these initiatives, we have successfully managed to reduce the company’s passenger cost per flight and at the same time increase seat utilisation. This is a typical example of how integrating our people and improving our work processes facilitated by the use of new technology can clearly benefit the company. Impact of best practice – a clear focus on delivery and where opportunities exist, we have either improved their efficiency or reduced their cost, resulting in: a cost/GPB per person reduction of 12%; an increase in seat utilisation by 7%.

Description of Best Practice

 For ConocoPhillips and the rest of the oil and gas industry, one of the largest day-to-day costs incurred in the management of our offshore operations is helicopters. It’s something we can’t function without yet be complacent and assume that because it’s necessary we can’t make efficiencies and cost savings. This was the challenge faced by the logistics team within ConocoPhillips UK where effectively managing the safe flow of personnel to and from our North Sea operations was paramount.

Making improvements in how we use our available helicopter seats and decreasing the actual costs incurred by each flight was also necessary. The first step was to move the logistics operations team to a co-location alongside the integrated planning and materials front-line support group at Rubislaw House. Being based within the company’s cutting-edge Integrated Operations Centre meant new technology was at hand within the logistics hub. Not only did this allow better monitoring of conditions offshore, it also improved the ability of the onshore aviation team being able to visibility to track flights to and from the offshore installations.

A 7-day service to the company’s offshore operations is now in place, an obvious winner in a 365-day a year business. But could the logistics team continue to make these efficiency improvements, yet still work to reduce costs?

Tracy Morrison, UK Logistics Manager explains:

“By raising the awareness of the efficiency initiative within the group, implementing performance measures and reviewing our existing processes for tracking costs across the business, we have been able to focus clearly on delivery and where opportunities exist, we have either improved their efficiency or reduced their cost.”

The change to the offshore core crew rota from 2 weeks offshore/3 weeks at home to 2 weeks offshore/2 weeks at home brought an additional opportunity for the logistics team to make further improvements. Working closely with the helicopter providers, were able to modify flight schedules and reduce the overall number of flights required to safely service the ConocoPhillips offshore operations in the UK.

Contact: Sandra Duncan
sandra.duncan@conocophillips.com

PlanSea Limited- Cost reduction of UKCS marine support operations through efficient fleet scheduling

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Submitted by PlanSea Limited

Impact

  • The study has shown that there is potential to improve the efficiency of the vessel fleeting arrangements by moving to a schedule where vessels service multiple locations.
  • This has the potential to reduce considerably the number of vessel days procured through the efficiencies which in turn will offer cost savings.
  • More work is required to validate the scale of actual savings.
  • improved data management has the potential to greatly enhance operations control and oversight of KPIs
  • Reduced overall vessel time at sea will enhance Health, Safety and Environmental impacts
  • Additionally the software has the potential to impact positively on operations where the assets have a more diverse geographical spread and where fleeting decisions are more complex.

 

Description of Best Practice

Marine support constitutes a large part of the OPEX budget. Any savings realised translate into lower lifting costs, which in turn can support extended field life and, in some cases, new field viability.

A single Platform Supply Vessel (PSV) can cost around £3.5M in annual charter fees, with fuel and port costs adding substantially to the overall cost. There are circa 250 PSVs in the North Sea, circa 1500 PSVs globally.

There is enormous complexity involved in planning and scheduling material for offshore. This means that many operations simplify the process by “fixing” sailing schedules well in advance, forcing other schedules to work around these fixed points. At present, there are very few decision support tools in this area that could help break this logjam.

Nexen Petroleum UK Ltd commissioned PlanSea, a spin-out from The Robert Gordon University (RGU), to examine their UKCS operations to determine whether recent developments in machine learning and optimization could impact positively on their marine support costs.

The study used PlanSea scheduling software to reschedule 65 weeks of recent historical operational offshore support activity under realistic and pessimistic assumptions and using the same data and core fleet. The outcomes were compared on KPIs with the results of actual operations.

Features of the PlanSea scheduling software include :

  • maximising vessel utilisation and efficiency through optimised scheduling
  • right-sizing” vessel fleets
  • minimizing spot market (short term hire) exposure
  • supporting vessel sharing/collaboration schemes (in line with the recent Wood Report)
  • managing operational information including strong interoperability with enterprise information systems
  • minimising time at sea (thus minimising health, safety & environmental risk)

 

Contact: Jim Cargill
jim@plansea.co.uk

WorleyParsons- Track and Trace

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Submitted by WorleyParsons

Impact

Cost Efficiency for Customers
Track and Trace offers a direct cost benefit to the industry.  This is evident from a Flotel campaign in 2014 which resulted in savings of circa £750K for the customer through reduction of non prodcutive time offshore, no material losses and therefore no reorder costs.  The technology provided cost and schedule predictability thus mitigating project delivery risks.

Considering the number of projects operating in the UKCS and facing similar material management challenges, the potential for cost savings for the industry with the use of this technology will be substantial.

Potential for more
While WorleyParsons has successfully utilised this on a project basis, it is commonplace in other sectors to use it to manage inventory and logistics at a cross enterprise level.  For example a major retailer will typically manage global inventory, order requirements, enterprise stock levels, all material movements, and point of sale order fulfilment for hundreds of stores, from several geographically diverse distribution centres in a globally integrated Supply Chain.

The potential exists for similar enterprise wide control of material logistics management across multiple projects, customers and stakeholders within the Oil & Gas Sector in order to deliver even greater efficiencies

WorleyParsons and DAI can present to the ETF the significant transformative change in efficiency that has been achieved to date by using this technology and best practice from other industry sectors. In addition, and from direct experience, we can highlight further efficiency gains which the technology has enabled in those industries.

We are aware of the Efficiency Task Force activity on digital warehousing and would like to investigate any potential efficiency savings in working Track and Trace and digital warehousing together.

Description of Best Practice

WorleyParson’s Track & Trace programme controls and tracks the movement of materials across the globe.  Delivered in partnership with DAI, it is a proven technology and has the capability of being extended from its current ‘per project’ focus to a ‘cross enterprise’ focus, and potentially a ‘cross sector’ focus.

Track & Trace Programme – Summary of Current Position

Track & Trace has been deployed on ConocoPhillips Alder, Talisman Montrose Arbroath Area Redevelopment, BP Clair Ridge Hook Up and Talisman HUC projects.

DAI’s mature, cross industry proven product is used by ASDA, Tesco, DHL, Adidas, Coca Cola, among  others, to manage business critical material logistics functions across their internal and external supply chains.

Track & Trace has been developed specifically to meet the unique Oil and Gas sector challenges.  It tracks the movement and status of materials and tools across the global supply chain from supplier to point of installation offshore.

The solution ensures that the right materials get to the right place at the right time with the right certification and are correctly issued for use against the right job cards / work orders.  In doing so it provides real time visibility of progress to stakeholders.  It also integrates with existing procurement and project management systems for improved planning and management decisions based on real time inventory status.

Track & Trace mitigates project delivery risks by limiting schedule impact due to key material losses.  It reduces material re-orders, manual data errors, warehousing inefficiency, material contingency purchases, mis-identification, mis-use, material reconcialiation costs and non certification.

The factors noted here work together to ensure that Track & Trace helps in reducing cost, time, and wastage – whilst increasing safety, effciency, predicatability and integrity.

Furthermore, at the end of the project the delivered asset has a full auditable history in place for every component part.  This can then feed forward into Operations and Maintenance, and through eventually into decommissioning.

Initial results from the Talisman MAR project 5 month flotel campaign show 99.96% of project materials being receipted and  issued offshore, on schedule, along with complete certification records. (i.e. 4998 out of a total of 5000 line items)

Contact: Roy Choudhury, WorleyParsons