Composite Results of the Project Complexity Study
In the February issue of Oil and Gas Facilities, I outlined the details of a study currently under way about the drivers of project complexity and invited readers to answer a questionnaire. While we have not received a large sample of responses so far, several readers have answered the questionnaire and the results have been generally consistent.
A summary of the responses is presented below. If you have not answered the questionnaire, please do so now, especially if you disagree with or have something to add to the responses.
Inherent Project Complexity
Are the projects you work on now inherently more complex than they used to be? How has it affected the design and the design team makeup?
Our projects still accomplish what they always have—produce and separate oil, gas, and water—but they are larger and more technically challenging. More complex reservoirs may require waterflood, gas reinjection, artificial lift, and enhanced oil recovery. Subsea production, especially subsea processing, adds a great deal of complexity. More centralized facilities means the cost of shutdown is greater, resulting in greater levels of redundancy.
Even when the piping and instrumentation diagrams look like projects of yore, if you are building the largest ever xxx, or the highest pressure rating yyy, or using novel compact designs to save weight and space, these features add complexity.
Despite large uncertainty in production and recoverable reserves, we design to great detail, often “optimizing” for cases that likely will never happen.
Because the platforms are larger, the economic risk is greater. This results in increased social complexity in the form of more partners sharing the risk.
To accomplish larger and more complex projects, we have larger and more complex design teams. These teams are frequently spread across multiple companies in multiple countries. Equipment is also sourced from around the world, and the global supply chain management adds significant complexity.
More complex projects yield more complex maintenance management systems and mechanical integrity programs.
Codes, Standards, and Specifications
How have changes to codes, standards, and specifications affected the project design? More or less complex? Have the changes to codes or standards contributed meaningful improvement in designs?
Projects that fall within a single regulatory jurisdiction are marginally more complex as the codes and standards evolve to become more comprehensive. Disruptive events such as Piper Alpha or Macondo often result in spasmodic changes to the regulatory codes and standards with usually increased complexity as a consequence.
Projects that fall outside a single regulatory jurisdiction (areas lacking a mature regulatory infrastructure) are often made more complex as they draw codes and standards from a number of jurisdictions depending on what is felt to be the “best fit” according to the whims of the design team and/or management.
Operating companies used to have general specs only, but now they have many more specs. This adds complexity at the vendor interface because vendors and fabricators cannot understand it all. A great deal of time is now spent dealing with spec issues with vendors.
How have regulatory changes or differences affected your designs or design organizations?
The relationship between regulator and operating companies has declined in the US over the past few years, and this lack of trust has added to complexity. We are less confident now that we can predict the response of regulators. Things that used to be generally accepted may now not be, especially when dealing with the US Coast Guard and classifying society rules and interpretations on floaters. This added uncertainty causes design teams to often go above and beyond the regulations to be sure of success.
If you have the facility classified, that requires much more paperwork and some increase in design complexity.
In subsea projects, recent clarifications have increased the requirements for pressure rating of trees and risers.
Safety culture has changed significantly over the past 30 years. How are your designs different? How are your design teams different? Which studies are done today that were not done years ago? What do we learn from them? Which organizations or communities are involved now that were not in the past? How are they involved?
There has been a significant increase in safety emphasis on projects. This is driven to a large extent by improvement in tools and increased adoption of tools such as hazard and operability studies, layer of protection analyses, blast studies, and dispersion studies. Many more safety studies are done now. Better tools focus more attention on safety issues and may improve decision making on occasion, but they also frequently delay decisions and force changes late in projects. (Author’s note: More than one respondent wondered whether some of these studies actually improve safety.)
Designs are generally more conservative and facilities more expensive as a result. A good example is the philosophies of equipment isolation that incorporate many redundant valves.
The design team pays more attention to risk, with the consequence being the presence of larger teams with more risk management specialists and more time spent on risk reviews. We now have safety specialists on projects; 15 years ago, facilities engineers did it.
How has technology changed what is actually built? Are systems being built significantly more complex? What is the benefit of the increased complexity? How has communication technology changed the scope and makeup of project organizations? Does the increase in design team complexity or scope result in improved design?
The technological frontier continues to be where the opportunities are found. Deeper wells, higher pressures and temperatures, harsher environments, and larger scale are driven by necessary economies of scale.
Topsides instrumentation and safeguarding has become significantly more complex, and a shortage of control system design skills in the industry exacerbates complexity. Controller-tuning skill is frequently absent on offshore platforms, resulting in control systems that perform poorly.
The increase in the number of alarms is problematic.
In many cases, existing technology is employed at a different scale or in a different application. Often these situations do not receive the attention they deserve. Installing the largest ever xxx or the highest pressure yyy adds complexity that may not be fully appreciated by the design team. The installation of driven piles in 5,000 ft of water while using “proven” technology is a significantly more serious engineering and operational challenge than in 1,000 ft.
Modern communication technology may be the most important factor driving the level of project complexity that can be undertaken. Communication technology has created the illusion that we can effectively communicate and coordinate widely dispersed, complex design teams simply via use of this technology.
Increased communication gives managers the illusion that they can understand complex issues by getting high-level input such as in a conference call or a string of emails. This creates more project management interference in decisions that should be left to subject matter experts(SMEs).
Design Team and Operator Preference
Which “simple preference” changes do you see in projects (design changes just because we can)?
Operating companies and some design teams have particular preferences. This does not necessarily cause complexity, but we must note that the more a current project is like previous projects, the fewer surprises and less complexity we should expect. Some operators have copied platforms with great success.
Complexity is frequently added in the name of flexibility.
One operator challenged its engineers to identify the simplest design that will work and incrementally add complexity where it can be justified. The preliminary result seems to be that not much complexity is justified when viewed from this perspective. Paradoxically, design teams generally design fairly complex systems and it is then difficult to remove the complexity.
Complexity is often driven by a partner, sometimes by a partner trying to prove up a new technology.
Late changes in a design can add considerable complexity and may cause problems worse than the one that the change is designed to fix.
As an organization gets larger and more diverse, does the coordination of individual efforts become more difficult? Have you seen an increase in coordination problems on projects? Has communication technology improved coordination?
There are many more people on project teams: “twice as many people as 10 years ago.” Despite this increase, many engineers worry about details and there may be fewer people thinking about the big picture, so larger issues fall through the cracks.
On simpler projects of yore the project engineer understood the entire project. More complex designs have created more fragmented design organizations with more and more narrowly focused SMEs. Coordination of the efforts of far-flung, narrowly focused SMEs is a challenge that is recognized. But the solution is often to make a relatively inexperienced engineer the interface manager.
Effective coordination requires effective decision making, especially when conflicting opinions occur and negotiation is required. It is often hard to tell who has the ultimate authority to make technical decisions. The decision processes now in vogue often relate to team dynamics rather than respected gurus as in the early days.
Complex execution strategies can add significantly to complexity. Major offshore lifts require careful weight control in the design and fabrication effort and fixes the sail-away schedule. Installation campaigns frequently require multiple installation vessels following a carefully choreographed script.
This required coordination is made possible by modern communication tools (email, Internet, video conferencing) and software tools such as scheduling packages and shared design tools; for instance, widely dispersed engineers can be working on the same 3D CAD model.
We now frequently have much more operations input on project teams—a very good, necessary thing. It would not be so necessary if we gave young engineers more operations training. Design engineers generally do not know much about how the kit they are designing will be operated, and it is now much more difficult to get engineers offshore to get the experiential knowledge they need.
(Author’s note: More than one person questioned the efficacy of stage gate processes.) Stage gate reviews of project readiness and competitiveness can become roadblocks to initiative and innovation. Often this leads to leveling the playing field into one of mediocrity, not world class. Often it is a crutch for leadership rather than the appropriate exercise of real leadership.
Did a simple error, change, or delay in one area of the project unexpectedly cause a significant problem elsewhere?
Emergent behavior is surprising behavior that occurs (emerges) from the interaction of system components. Emergent behavior is common in nature. An ant colony is an example. A single ant by itself will wander aimlessly and die, but put thousands of ants together and a social order emerges that includes division of labor for nest building, defense, and food scavenging.
Complex projects are composed of multiple pieces that must fit together properly and in the proper sequence. Emergence occurs when a single component does not work or is delivered late and this has a domino effect.
Out-of-sequence work adds a great deal of complexity. This occurs routinely when equipment items or design documents are delivered late.
At least when the technology is new, we tend to apply the resources necessary to make it work. Ironically, many of our errors are Engineering 101 errors, and errors can be considered emergent.
Did a shortage of skilled personnel or other resources affect the project design complexity?
We design for steady-state operation in as-built condition. Narrowly focused SMEs, not well versed in how the kit they design is actually operated, miss important dynamic-operating conditions.
We now have fewer staff with the broad industry knowledge and the experiential knowledge to make good decisions easily. And it is difficult to train young engineers because it is much more difficult to send young engineers offshore today. As a result, we rely more on studies.
Local content rules sometimes force design work to be done locally where suitably skilled people are not yet available.
More monitoring of vendors is required because of the more specific specifications that vendors frequently do not understand. But we often do not have enough staff on projects to review vendor documents as well as necessary. More errors happen because we do not have the skilled people to catch them.
There is a lack of skilled crafts in construction yards. Often the designs do not recognize that limitation; thus, complex designs using sophisticated materials are specified far beyond the knowledge and capabilities of the contractor’s personnel or of the operator.
A real issue is how to develop project managers (PMs) with knowledge, leadership capabilities, technical know-how at a reasonable level, and the ability to manage stakeholders. Also, we need PMs who can press for “just enough” rather than the more and better approach to all issues.
Suitable skills frequently do not exist in the design houses for design of novel systems. Very large waterflood systems featuring ultrafiltration and specialty deoxygenation systems are an example where experienced design engineers are hard to find.
Skills are frequently inadequate for the design of effective deepwater chemical injection systems.
Heavy oil projects such as oil sands projects require unique skill sets possessed by few.
Howard Duhon is the systems engineering manager at GATE and the SPE technical director of Projects, Facilities, and Construction. He is a member of the Editorial Board of Oil and Gas Facilities. He may be reached at email@example.com.
Delayed Project Sanctions in 2017 More Than Double the 2015–16 Count
Delayed final investment decisions during the final quarter of 2017 led to more than double the combined count in 2015 and 2016.
C-Innovation Forms Subsea Projects Group
C-Innovation formed a turnkey subsea projects group based in Edison Chouest Offshore’s Houston office. The vertically integrated network of affiliate companies will provide support for complex projects.
Effective Site-Based Project Portfolio Execution Requires Owner, Contractor Staffing Balance
Independent Project Analysis researchers took a closer look at site project system staffing approaches including full alliance, owner engineering, contractor engineering, and core staffing to determine the effect of staffing characteristics on capital project outcomes.
26 January 2018
12 February 2018
25 January 2018
30 January 2018