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Quality

Managing Water Can Improve Productivity

Source: E&P | 10 October 2013

With more than 290 bbl produced in 2010, operators need a consistent integrated plan to reduce, control, and reuse water.

In today’s world, the availability of fresh water is a growing public issue. Population growth, industrial demand, and droughts are all factors that affect its availability. Even though the oil industry uses only a small percentage of available fresh water (less than 2% in the US), regulations from federal, state, and even local organizations are having a dramatic effect on availability and cost.

Equally important is the industry’s responsibility to ensure that hydraulic fracturing operations will not disrupt communities. But is there more to managing water than just a social license to operate? Does it make good business sense in a key metric such as well productivity?

In the oil field, water is used in every aspect of drilling, completing (fracturing), and producing. There are significant costs associated with water beyond finding the water. Logistics, storage, pumping, treatment, and reinjection/disposal costs also must be considered.

Custom Designing Fracturing Fluids Enhances Water-Management Strategy

Source: E&P | 10 October 2013

The industry is becoming more creative in how it manages water to maximize efficiency in its operations while reducing environmental footprint.

Water is the base fluid—and most important component—in the process of hydraulic fracturing for shale oil and gas development in North America. With the growing demand for fracturing, oilfield service providers face significant challenges to find and use water from nonfresh sources that will work effectively with their fracturing fluids while also minimizing the impact of their operations on the environment.

One significant change in fracturing operations is that the industry needs to use more water, which requires more efficiency. As a result, the industry is constantly getting more creative in how it manages its water to maximize efficiency in its operations while reducing environmental footprint.

QA/QC of Water Blending Enhances Crosslinked Gel Completions

Source: E&P | 10 October 2013

Managing wastewater and completion chemicals removes obstacles to wastewater reuse.

In the first half of 201,3 more than 17,000 wells were drilled in the US, with nearly half of those drilled in the Williston and Permian basins and the Eagle Ford shale, according to the Baker Hughes well count. More than half of the total completions in these areas currently rely on the use of crosslinked gel as a method of increasing the viscosity of water so that it will effectively carry proppant into the reservoir.

Each of these regions is arid, and the water demand to support hydraulic fracturing programs can be a strain on local water supplies. Concurrently, operators are producing flowback fluid and produced fluid (wastewater) from these same wells, which is most commonly disposed of via saltwater disposal wells. Many operators are now seeking to reuse this wastewater as fracturing fluid, which offsets the industry’s use of freshwater resources, reduces the cost associated with acquiring fresh water, replaces the need to add potassium chloride (KCl) for clay stabilization in the reservoir, and in some cases may be a cheaper alternative than disposal.

InterMoor Appoints New Global QHSE Manager

Guidry

Guidry

InterMoor, an Acteon company, has announced the appointment of Cohen Guidry to the role of global QHSE manager. Guidry joined InterMoor in 2006 as HSE manager and has more than 20 years of experience in the offshore oil and gas industry, mostly in quality, health, safety and security roles. He will be based at InterMoor’s offices in Morgan City, Louisiana.

Over the past 6 years, Guidry has worked as InterMoor’s West Africa operations manager, where his responsibilities focused on developing the company’s business in Nigeria, Ghana, and Angola as well as coordinating mobile offshore drilling units for mooring systems installations. Guidry served in the U.S. Army from 1988 to 1992 and is a Desert Storm veteran. He graduated from Nichols State University with a Bachelor of Science degree in business in 1996. Guidry is a certified lead auditor.

“Cohen’s appointment as global QHSE manager underlines InterMoor’s position as a leader in quality and safety assurance,” said InterMoor’s global president, Tom Fulton. “This role better enables us to bring together our experience of operations conducted globally, to ensure that we are sharing best practice work standards around the globe while maintaining our focus on outstanding QHSE performance.”

IWCF Shakes Up Training Regime in Response to Macondo

Source: Rigzone | 27 September 2013

The International Well Control Forum reported that it is unveiling a new syllabus and training regime based on recommendations from oil and gas producers that are a direct result of the Macondo disaster in the Gulf of Mexico in 2010.

The IWCF, which sets international training standards for well control, said it worked with the International Association of Oil & Gas Producers on recommendations to enhance existing well control training, examination, and certification. The new syllabus and programs are designed to deliver a step-change in competence, it added.

Column: Putting the ‘Q’ into HSE

Source: Offshore Engineer | 5 September 2013

In order to utilize quality to bring about an effective HSE system, first it must be defined. This in itself is a challenge as quality is often about the perception of the individual. Joseph Juran, principally remembered as an evangelist for quality, gave the definition as “fitness for use” whereas Philip Crosby, author of “The Fourteen Steps to Quality Improvement,” thought it was more a case of “right first time.”

Perhaps the simplest definition is that of the Oxford English Dictionary, which says “the degree of excellence of something.” Whichever definition is used, a quality approach to achieving effective health, safety and environmental responsibilities is one that can bring immediate benefits to the organization.

Quality is easy to say, but is it a word that is overused as well as ill-defined? After all, what company believes it is not applying quality to everything it does?

The Case for Process Safety Management

Source: Health & Safety Middle East | 30 August 2013

Against a background of well documented tragedies, Katherine McCarthy argues the case for establishing meticulous process safety management systems.

Major, memorable accidents and the severity of their effect on not only the stakeholders within the oil and gas industry, but the people and communities directly involved, have prompted much attention towards process safety management (PSM) systems, not only oil and gas activities, but in other process industries as well.

Labor Department Monitoring Shale Gas Work Issues

Source: Fuel Fix | 5 August 2013

It’s amazing how many times Rodney Bean has heard the phrase “but everyone’s doing it” from oil and gas companies, big and small.

“Everyone” hires independent contractors instead of employees. “Everyone” pays a flat day rate instead of a salary or hourly wage.

When these companies get a notice from the US Department of Labor, they call Bean, an attorney with Steptoe & Johnson, and he tells them, in the most respectful way: Yes, you’re right. Everyone is doing it. And they’re doing it wrong.

Bean is getting more and more calls these days, as the Labor Department’s Marcellus Shale Initiative enters its second year.

The agency began targeting oil and gas firms because the industry has shown a pattern of labor law violations, according to John DuMont, district director for the department’s Pittsburgh office. The firms tend to improperly label their workers as independent contractors, which allows the companies to avoid paying overtime. They also pay employees a day rate without calculating how many hours are worked in a week and without keeping proper records.

Column: Change Is Impossible Without Addressing Resistance

Source: Phil La Duke | 5 August 2013

When it comes to organizational change, for my money, you can’t beat the work of Edgar Schein. Schein is considered by many to be the father of organizational development; he coined the term “corporate culture” and, if for that fact alone, should be revered in the same hushed tones in which people talk about Edison, Deming, or Jobs.

Schein postulated that organizational change can only come when the resistance to change is less than a combination of dissatisfaction, vision, and next steps.

I have devoted much digital ink to fomenting discontent, casting the vision, and crafting logical next steps, in fact, I make my living doing all three; but what about resistance? How do we recognize and attack it. Week after tedious week I work with organizations that seek rapid change—a means of accelerating culture change without merely masking symptoms by obfuscating them with a climate change. Some say it can’t be done—that culture change is a long and laborious process, but since time is money, most notably money that ends up in the pockets of safety culture (mostly through greed or stupidity) I distrust the argument—I say it can be done. I’ve done it.

Report Blames Manufacturing Defects for Mayflower Pipeline Spill

Source: Rigzone | 16 July 2013

An independent report conducted by Hurst Metallurgical Research Laboratory faults manufacturing defects on the Pegasus Pipeline that ruptured and spewed 150,000 gallons of crude oil in Mayflower, Arkansas, Exxon Mobil reported.

Cracks were found near a seam that opened on the ruptured pipeline, the report stated. The report was provided to ExxonMobil and the Pipeline and Hazardous Materials Safety Administration, which both declined to release the report publicly.

The defects identified in the report reflect the “root cause of the failure,” the company stated. Ongoing tests are being conducted to evaluate other factors in the spill that evacuated 20 families from their homes. ExxonMobil said the cleanup is continuing and the pipeline is shut-in.

Study Looks at Current State of Corporate Sustainability

Source: KPMG via Mondaq | 9 July 2013

Climate change and Sustainability issues are becoming increasingly important in today’s corporate agenda. Major businesses are becoming more engaged in adopting essential initiatives to improve their business performance, reduce and manage costs, innovate, respond to stakeholder demands, and gear up for regulatory changes. Specifically, businesses are concerned with mitigating climate change and sustainability risks, and in turn convert these risks into strategic opportunities. But, what does it mean to be sustainable?

A preliminary study conducted in 2011 by KPMG International in cooperation with the Economist Intelligence Unit entitled “Corporate Sustainability: A progress report,” defined corporate sustainability as “adopting business strategies that meet the needs of the organisation and its stakeholders today, without compromising the ability of the organisation to sustain the resources both human and natural that will be required in the future.”

 

Optimization of Reliability and Maintenance Unlocks Hidden Value

Source: Oil and Gas Facilities | 1 July 2013

Unplanned capacity downtime because of equipment problems in onshore and offshore oil and gas production facilities translates not only into decreased volumes of sales product but also into the potential for interrelated equipment or process slowdowns or shutdowns. Compared with the US industrial average downtime ranging from 3 to 5%, the oil and gas industry’s estimated downtime ranges from 5 to 10%, indicating that improvement is needed in reliability and maintenance (R&M) of facilities, equipment, and processes.

Robert MacArthur, head of ABS Group’s asset and maintenance optimization practice, said, “I have been on offshore platforms that were in a crisis mode of operation, running at 30% unplanned downtime.”

He estimated that the oil and gas sector may also fall short in another key performance indicator (KPI)—assets meeting their engineered life expectancy. The industrial sector’s assets last approximately 65% of their expected life on average. “Midstream and downstream asset life expectancy is about 65%, but offshore is estimated to be somewhat lower,” MacArthur said. Although there is no specific KPI for offshore asset life expectancy, the marine corrosive environment likely affects the asset longevity.

Effective management of R&M in production facilities can be challenging for many reasons: the complexity of global operations; remote, isolated facilities; limited or poor-quality legacy data from which to build a meaningful database; and inability to amalgamate existing databases.

Attaining the Highest Production Capacity at the Lowest Cost

To appreciate just how far R&M initiatives have come, consider that, 20 to 30 years ago, Six Sigma initiatives, business process reengineering processes, and lean operations were the state-of-the-art in efforts to improve R&M. In the 1990s and early 2000s, supply chain optimization gained favor. These previous efforts improved R&M and added value to the organization.

Major oil and gas companies, for whom 2% capacity downtime because of maintenance represents a significant cost to operations, are now asking, “How can the next 1% capacity improvement be achieved with R&M?”

Citing industrial findings, MacArthur highlighted areas where improvement in R&M is needed. He said that in many operations, 10% of the asset base drives 90% of the cost and operational effects. And while studies have shown that 90% of asset/component failures are random and not based on time parameters, 90% of companies still run a predominantly time-based intrusive preventive maintenance program. The required opening and inspecting of equipment can contribute to its operational failure. He added that predictive/condition-based maintenance is nonintrusive (the equipment is not opened) and better aligned to identify pending failure. Maintenance workers in many facilities and operations average 25% wrench time during their work shifts, equivalent to 2 hours per 8-hour shift; the majority of the remaining shift-hours are spent looking for parts and seeking supervisors’ technical approval or feedback. The average maintenance, repair, and operations supply chains and storerooms are short of critical spares and overstocked by 20%.

These inefficiencies increase downtime and maintenance costs. The capability to identify shortfalls in an organization’s R&M establishes a benchmark of current performance and establishes a baseline from which needed adjustments can be made.

Enterprise Asset Management

In the late 1990s and early 2000s, asset-intensive organizations placed increased value on enterprise asset management (EAM) because of increasing global competition. The ARC Advisory Group recently identified the following business drivers for EAM: reduction of cost for maintenance labor and parts, extension of asset longevity, improvement in uptime, and management of safety and risk factors.

EAM comprises the following components:

  • Strategy—includes measurement and tracking of KPIs integrated with resource and planning optimization strategies, such as total productive maintenance. Strategy determines the company’s direction toward achieving its R&M goals.
  • Maintenance, repair, and operations (MRO) processes—include work management, inventory, planning, purchasing, and scheduling.
  • Technologies—serve as enablers within EAM and include computerized maintenance management systems (CMMS), calibration management software, pressure vessel and valve tracking applications, predictive maintenance software, and handheld devices. These applications use engineering data to provide an automated tool set to support MRO processes while producing empirical data for analysis and KPI tracking.
  • Engineering data—electronic data from equipment/assets, inventory stock, operations, resources, and maintenance procedures. Serve as the foundation for the overlaying technologies, which in turn are used to support the MRO processes. EAM strategy implementation is impossible without the engineering data, technologies, or MRO processes.

EAM Implementation

Who are the decision makers for EAM implementation? “Ten years ago, a plant or asset manager made the decision in 70% of the cases. A maintenance manager would often be a champion working to convince a plant or asset manager to implement EAM. In 25% of the cases, it was decided as a corporate initiative. Today, those numbers have flipped. About 90% of the time, we are dealing with an enterprise approach to EAM, usually driven out of the corporate function of operations and production. We are seeing what may be a bellwether. Increasingly at the corporate levels of large industrial companies, there are designated vice presidents of asset management, which was never heard of 10 years ago,” MacArthur said.

Implementation of EAM takes time. In the case of large offshore operators with thousands of assets and people, from 12 to 18 months are required to move from one category to the next in Fig. 1. Moving from the planned to enterprise category is a 3- to 5-year process.

The three steps to advance an R&M program include:

  • Benchmarking of the operator’s current status and identifying areas of opportunity for improvement with assessments of R&M strategy, work management, planning and scheduling, organizational readiness, EAM/CMMS functionality and utilization, inventory management, and metrics and performance improvement.
  • Plotting the plan/strategy. Each organization has different constraints and conditions. For example, if a CMMS needs to be upgraded, but the company has a large-scale enterprise resource planning (ERP) implementation slated to occur in a year, it may not make sense to replace the CMMS before the ERP. If the work management processes, which are the lifeblood for the data that reliability engineers analyze, are not sound, it makes no sense to hire, train, and put in place reliability engineers. “It’s like building a house. It does not make sense to spend a lot of time on the architectural roof shingles if we haven’t poured the foundation,” he said. The plan fills the identified gaps in R&M to create and sustain the asset reliability, maintenance planning and scheduling, and MRO supply chain programs.
  • Implementing EAM. The components of EAM (strategy, MRO processes, technologies, and engineering data) are integrated into the company’s infrastructure.

Case Studies

ABS Group worked with a major oil and gas producer to identify its major safety-related equipment and systems, loading the data to the CMMS, and reviewing/updating maintenance plans to assure the integrity of these assets. Because of the unavailability of the company’s maintenance and engineering resources, ABS Group provided project management, safety, discipline engineers with experience on offshore assets, and process engineers with documentation experience.

The project illustrated the complexity in the components of large-scale R&M programs. It included reviewing 220,000 offshore assets; identifying and categorizing 85,000 safety-related assets; loading information to the CMMS and linking to the producer’s desktop facility status reporting tool; developing 180 safety performance standards for equipment; and comparing and analyzing existing maintenance routines in terms of the new performance standards. All of the above information was linked to the producer’s CMMS.

The producer realized the benefits of all safety-related assets identified and maintained in the CMMS and developed and published performance standards for use in the company. Facility status reporting was functional and rolled out globally.

Another offshore operator sought assistance in the planning and scheduling of several rotating campaign teams working on the backlog and mini-projects that were outside the routine work of the core maintenance team.

The operator requested help in coordinating work packs for offshore teams, which included grouped preventive maintenance work orders for critical systems along with corrective and modification work for the same systems; daily management of team scheduling and reporting of progress against plan and backlog reduction; review and improvement of maintenance routines, scheduling, planned labor/material and maintenance effectiveness for critical systems; development of corporate maintenance strategy related to offshore asset reliability; development of new process flows for maintenance activities; and cleanup of CMMS data in preparation for upgrade of the system.

To date, the operator has achieved a 40% reduction in backlog hours and review/improvement of 20% of the critical system maintenance plans. Preparation and coordination of work packs has been completed for campaign teams through five tours.

Looking Ahead

Over the next 10 to 20 years, new technology capabilities are expected to further expand the potential of EAM, MacArthur said. Today, Web-enabled technology is commonly used, and the use of cloud network technology is growing.

Smart equipment capabilities will also expand, such as GE Measurement and Control’s recently introduced condition monitoring and sensing technologies for the subsea sector. The acoustic leak detection system detects and locates subsea oil and gas leaks by discriminating the noise of a leak from other sources of sound in a 500-m area of coverage by using passive, acoustic hydrophone technology. The company’s subsea multi-domain condition monitoring system combines electric emission monitoring and acoustic hydrophones designed for monitoring the operating condition of subsea machinery and processes. The system performs multi-domain analysis based on pattern recognition and machine learning algorithms to identify and display subsea structure, machine, and pipeline activities and anomalies.