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Cut costs in 100 days - ABB

Friday, March 4, 2016

Automation, power and consulting company ABB has developed a '100 day challenge' program for oil and gas companies, to help them identify ways to cut costs in 100 days, and make the required organisational changes.

It is often not difficult to work out where costs can be cut, for example if your planned maintenance system requires you to do a maintenance task on an item of equipment which might not need the maintenance right now.

But there are usually organisational reasons why it is difficult to make the change, for example, it might be thought to put a small additional risk on someone's desk, and no-one wants to accept this risk. This can be overcome by evaluating the risk or making a company decision that the risk is acceptable, but this creates more work, which is at a lower priority to day to day demands.

To overcome the organisational challenges, ABB suggests that the company commits to a concentrated effort over 100 days to try to cut costs, to try to keep the focus at the top of people's priority lists, rather than the bottom.

Typically the study will identify ways that overall operational expenditure can be reduced by 2 to 2.5 per cent, and bed space freed up for people working on other tasks, says Dai Richards, Global Marketing Manager of ABB Consulting.

Usually companies pick one or two topics they want to focus on, as part of their 100 day challenge, he says.

Inspection and maintenance

One of the easiest ways to reduce costs is look for inspections or maintenance which is being carried out more frequently than is necessary, Mr Richards says.

You can argue that unnecessary inspections can increase risk more than they reduce it, since doing an inspection can often require a shut-down of production, leading to other hazards, he says.

Vessel inspections can be hazardous, if they require someone to go inside and crawl around. There are NDT inspection techniques which can do the job better and safer.

Many companies could benefit from more use of non-invasive testing techniques such as ultrasonic testing, says Andy Hollins, Principal Consultant with ABB.

85 per cent of pressure vessel inspections are usually done by sending someone inside them, which means shutting them down and emptying them.

'We've looked at 700 vessels on platforms, 60 per cent are now inspected with non-invasive inspection,' he says.

Pressure safety valves are often tested much more frequently than they need to be.

ABB has a methodology to determine optimum time to inspect safety valves. When used by the company's clients, it suggested increasing inspection intervals for 70 per cent of valves and reducing them for 8 per cent of valves. The average inspection interval increased from 48 months to 62.

When it comes to maintenance, consider that shutting down a plant completely for annual maintenance may not be necessary. Some chemical plants do not have any periodic shutdowns at all, Mr Richards says. This is not right - they often operate for 5-6 years without them though

Analysing failure

You can also optimise your maintenance plan by getting a better understanding of why failures occur, says Mr Hollins.

Figures show that 48 per cent of production losses are due to plant equipment failure, and 14 per cent of plant equipment failures are due to problems with compressor trains. This gives you a good idea what to focus on.

Some compressors are so unreliable that their running time between outages is recorded in days.

Our work with another operator revealed that the weakest link in its systems were lube oil and sealing systems, Mr Hollins says.

Removing equipment

Another way to reduce costs is to remove equipment you are no longer using, Mr Richards says. Many platforms have old equipment which is regularly maintained, but which no-one ever plans to use again.

You still need to be able to argue that your risk is 'As Low as Reasonably Practical' which might sound difficult when you are proposing maintaining equipment less often. But you can do it if you can show you are not changing the risk, or perhaps reducing the risk, since maintenance itself can cause problems.

Organisational problems

A common occurrence when attempting organisational changes like this is that a senior manager will put his support behind a change, but the middle management resist it, and tell junior staff to ignore it, Mr Richards says.

Often, the middle management have designed the current systems, and believe that the maintenance intervals in them are correct.

People think they are already doing the right thing,' he says. 'If you've always lived in a regime where you shut down a platform every 12 months [for maintenance] it's difficult to change.'

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