Driving Excellence In Operations & Project Execution

Following on from the environmental debate, and closely linked- this discussion focused on the pursuit of operational excellence, and what is takes to achieve zero defects- from complex project management, to exploring the role of standardization in an HSE and Quality context. 

How to get the full supply chain of the industry to standardize in order to eliminate quality and HSE issues and ultimately - get to zero?

Our panelists discussed real examples of initiatives and projects and analyse the benefits of this transformative trend. 

What progress have we made regarding collaboration in your 30 years in industry, and what opportunities are still in front of us?

Mujib: The best example in our business is about safety. We’ve been able to make huge strides in process safety without compromising reliability or quality. In terms of what we’ve been able to deliver in the field, in execution with very large and complex projects, the safety performance that’s been achieved in the industry is something we can all be very proud of in terms of collaboration with operators, contractors, and supply chain. 

Areas where we can do much better, I think in terms of the EPC execution and commercial approaches, I believe we might have actually taken a step back in the last few years. Oil prices came down and the approach to risk appetite changed. A lot of risk was actually moved back to the contractors, and we’ve seen some challenges emerge in that respect. I think we can do much better as an industry to collaborate on that going forward.

How do you feel we’re moving forward?

O’Connor: “Project delivery has been a pretty inefficient industry, and I think there is a huge amount of opportunity for us to deliver our projects in a much better way. And I think collaboration is a key theme where we can seek that improvement. With procurement, historically every project created its own set of specifications. If I had a dozen separate projects going at the same time, we’d have a dozen separate sets of specifications asking for the same piece of equipment. It really came to light for me when one of our vendors took me to their warehouse and showed me three air compressors side-by-side. One was small, one was medium, and one was huge. They delivered the same requirement but were built differently because of the specifications. So we took that to heart, and we worked with the industry over the last several years to standardize the specifications with input from suppliers. To take it to the next level, we used the IOGP to create a set of industry standards, and we’ve now got 10 oil and gas majors signed up.” 

With the perspective of your cross-industry experience, how do you feel this industry could do even better in terms of standards? 

Haskins: “What David’s saying is absolutely music to my ears. But also, making things that need to be the same the same. You don’t want pilots flying their approach differently depending on which customer they’re flying for. I like a lot of the stuff that IGOP is doing, things like standardizing the life-saving rules. And the real important part of it is being able to implement those standards, to make sure that they actually help their people do their jobs on the front line. And then to get the data giving you the feedback about how well is it really going today. That’s where you start to have a virtual circle that allows you to optimize where you need to.”

How do we balance of the drive for standardization while still leaving room for innovation?

O’Neill: “I think they are absolutely compatible… The magic in where I think a lot of the innovation comes to bear is how you put those pieces together, and how you work with the supply chain. One of the things that Woodside has done is to go outside the oil and gas biosphere to find people who have all sorts of new and different ideas. One of the partnerships we have is with NASA—so we’ve got a couple of NASA engineers and a NASA robonaut in our technology lab. And that helps our people understand how we can use robotics technologies in our existing operations, for example to manage some of the safety risks in situations where you wouldn’t want to send in a human; or automating tasks that are mundane. So I think there’s a tremendous opportunity to couple standardization of kit with innovative new approaches to doing business.”

What are your thoughts on commercial and concept simplification for areas of innovation?

O’Connor: “To the point of commercial innovation, we’ve worked closely with BHGE over the last several years, and we’ve just agreed on a new type of arrangement on one of our facilities in Trinidad, whereby we’re building a new compression platform, and BHGE is essentially going to own the compression, and we are going to pay by the hour. Very different than what we’ve done traditionally. We’re much more aligned with this new approach, and we see that as a great way forward, and we’re looking for more opportunities to apply that elsewhere.

I think simplification is another theme around how do we improve project delivery… A few years ago, we built a new platform called Juniper that came online in 2017. We thought it was a great project, we thought it was a new concept, smaller project. This year we are starting up a new project called Angeline, which is a simplified version of Juniper. That will start up next month. And now we’re moving to a completely new concept in a project called Sip that’s taken the concept down another level of simplification whereby there’s no power on that facility. So we will provide power from an adjacent facility by cable. We’ll have no people on the facility, there will be no accommodation, no helideck. So it will be cleaner and safer. And it will be operated remotely because will have sensors on the equipment. So we’re really moving into a completely new world of simplification using creative and innovative technologies.”

As you’re planning new projects now, how are you thinking about the possibilities for them to dovetail with your existing operations, and to employ similar concepts?

O’Neill: “Building on the simplification theme, the Scarborough project that we’re working on, the concept we have is a floating production unit. And I think the traditional method would’ve had the engineers build the kit from the ground up. But one of the ground rules we started with was that, for normal staffing, we want to have everything based around one helicopter load of people, that’s 16 people. So, work everything around that, and it drives you very quickly to remote operations from shore, it drives you to being very thoughtful about minimizing the kit, it drives you to be really disciplined about what maintenance activities you need to have. So I think, at the end of the day, we’re going to end up with a facility that is safer, more reliable, and more cost-efficient. But you have to give the engineering team a bit of a challenge because, otherwise, organizational momentum to do it the old way is very strong.”

How does it feel from your side? You feel like we’re making progress in a similar way?

Farhan: “Absolutely. I think it’s great to hear the focus on simplification of standardization, and we can be a partner in that respect. We’ve been able to demonstrate on a number of projects that if you actually allow the EPC contractor to use industry specs, we can deliver projects that are fit for purpose, and you can actually reduce the capital cost of a project by 20%. We’ve been able to prove that it can be done. The process will actually be safer because your people are more familiar with what needs to be done, and they’re repeating the same thing. It’s substantially improves quality. We’ve been able to see that 40% of incidents that happened on projects happened as a result of rework. So, with a focus on safety, that’s a big thing you can do in terms of looking after people and project execution as well.”

How do digitization and data fit into all of this?

Haskins: “I think we can take lessons from the airline industry. They were in difficult times in the 1990s, and they set a target to reduce fatalities in airline events by 80%. This year, there were 4.3 billion passengers who flew safely in airlines across the world, and it’s a tremendous testament. They set a goal, and they achieved it within 10 years. And they did it in an interesting way. They got leading indicators of day-to-day frontline performance. They looked at the way the total system–human and machine–performs together doing critical tasks that would keep them safe. Things like detecting obstacles. And they started a really big data program… And it’s been a huge step forward because they have the data to see safety not as an accident, but as a day-to-day performance of the system.”

Do you see that we’re moving in that direction? Can you say that we’re genuinely monetizing our data and putting it to better use than we were?

Mujib: “I think we’re moving in the right direction, but we’re not there as an industry yet. I mean, there’s so much data available, and the challenge is using the right data in the right manner…You’ve heard about digital twin. We’re working on a project called Digital Project Delivery where you basically obtain all the data that comes from different sources and your build it in the design phase of the project; you take it into the execute phase of the project to help you with project control, scheduling, quality. Then at the end of the day we hand the data over to the owner, so they actually have the operating facility. So we partner with the owner and companies like BHGE to look at how we can improve the long-term reliability of those facilities. We can provide feedback, so we can have enhancement take place with all the investment that is already built in there.”

Do you equally feel that the data gives you the confidence to operate fundamentally differently?

O’Connor: “Digital plays a huge role [in operations]. With sensors in the wellbore, up the wellbore, through the production facilities, to the export choke, you can actually monitor what’s going on in your facility on a minute-by-minute basis, and proactively see issues before they become problems, and be able to step in there and enhance your operation. With BHGE, we worked very closely and Plant Operation Advisor is a tool we worked together on, and that’s paying huge dividends to us. We are seeing operational efficiency improvements through the adoption of that tool. So digital is just a huge topic that I think is going to transform our industry going forward.”

What are your reflections on the use of digital at Woodside?

O’Neill: “Woodside is doing a couple of things that are really exciting. First off, they’ve invested heavily in data science, making sure we’ve got the back office technology to do the predictive analytics work, the production optimization. But the other area that’s really exciting is sensor development. So if you think about the facilities we operate, some are 30+ years old and they weren’t instrumented with all of the data collection parameters that the engineers would want to be able to truly optimize the facility. So one of the things we’ve been doing is investing in very small, Wi-Fi-based magnetic sensors that allow us to gather data about how the process is working in places where it wasn’t originally instrumented. We feed that data back into the analytics, and continue to further optimize the plant. I think that’s one of the big challenges. The data packages and digital twins are great for new facilities, but retrofitting some things to older facilities is a challenge. And I think we’ve got some technologies that are helping break through.”

We can describe our technical roadmaps, but are we as good at describing our human road maps? How do we ensure that our organizations come with us on this journey, not just today, but to attract the talent of the future?

O’Neill: “I think the journey actually is really exciting. If you think about the operation space, one of the most unpleasant jobs to do in an LNG plant is to do fin fan surveillance that involves walking through a very hot part of the plant and monitoring the performance of hundreds of fans. If a robot could do the job, the operators are thrilled. Then you can let the operators apply their training, skills, and capability to really add more value to the plant, and take some of these mundane tasks off their plate. Equally in the office I think it’s quite empowering. I hear all the time stories about engineers being frustrated trying to find the data, and figuring out what data is true. So as the digital revolution moves forward, we’re going to be able to remove some of that frustration and let our technical professionals really focus on adding more value to the business.”

You’ve looked at human and machine interaction in other sectors. What’s your guidance for oil and gas in that regard?

Haskins: “My guidance is to make an effective partnership between humans and machines to deliver operational excellence. In order to do that, you need to understand what good looks like for your operation—how well are you doing today, where would you most like to improve? And then bring in new technologies and new things, but always try it out with the people. If you want to automate part of the job, make sure you don’t leave them with a very dull part of the job. And really give people a chance to partner with the technology to get the job done.”