Refiners planning 39% more maintenance spend in 2017
Scheduled plant outages, turnarounds and shutdowns are expected to increase by 5.4% to $10.43 billion across all U.S. industrial markets in 2017, with the petroleum refining industry to see the biggest increase, according to Industrial Info Resources.
Refiners will increase planned maintenance spend by 38.5% to $1.26 billion this year, the consultancy told Petrochemical Update for the US Downstream Engineering, Construction and Maintenance Outlook 2017.
The chemicals-processing sector will see a 4% increase to $1.81 billion, and the power sector a 9.3% increase to $3.54 billion. A combination of the other industries (pipelines, alternative fuels, metals, pulp and paper, food and beverage, manufacturing, and pharmaceuticals) will fall 4.7% to $3.82 billion.
Recent deferrals of planned maintenance turnaround activity are leading to an increase in demand for craft labor in the first half of 2017. Some 7,000 additional craftsmen may be needed to undertake planned turnaround work in Q1 2017, according to IIR.
Refiners are willing to spend the money to improve, but they don’t want to lose money from lost production, according to Nikki Bishop, Director of the Global Turnaround Program at Emerson Process Management. Since turnarounds are a lost profit opportunity, any delay in execution adds to production losses and undermines shareholder value.
Most planned turnarounds still end with overruns
Even though companies often plan maintenance projects months or even years in advance, some 68% of US refiners and chemical plants still fail to deliver their planned shutdowns, turnarounds and outages on time, says Brent Langley, Senior Consultant at Oracle Corporation.
Bobby Singh, President of Shutdowns & Turnarounds at Project Assurance consultancy, and author of the book “World-Class Turnaround Management: Business Driven and Reliability Focused”, conducts an annual benchmark survey of turnaround teams for refineries and chemical plants. The annual survey shows that many turnarounds lack focus, planning and leadership:
• More than 90% failed to meet turnaround goals;
• Eight out of 10 experienced growth in cost and scope;
• Three out of every four abandoned schedules in the first week of a turnaround.
According to data reported at the American Fuel & Petrochemicals Manufacturers’ Reliability and Maintenance Conference 2015, unrealistic targets are the top cause of a lack of performance success in turnarounds.
Proving mobile at DuPont
At its Mobile, Alabama manufacturing center, DuPont continues to reap the benefits of a multi-year effort to transform its execution of shutdowns and turnarounds to capture the benefits of higher onstream time and available capacity in oversold and emerging markets.
Chris Vaughn, maintenance team leader and turnaround leader at DuPont, spoke to Petrochemical Update for the US Downstream Engineering, Construction and Maintenance Outlook 2017. He credited the results primarily to the development of integrated schedules owned by operations, capital-project leads and maintenance.
The site benefits from a resident maintenance contractor with a high-performance, mature organization; however, until the establishment of an integrated, trusted schedule and alignment of key-performance indicators (KPIs), synergies among the key stakeholders could not be realized. This was especially true for large, non-routine shutdowns.
As with all initiatives for change, success begins and ends with leadership. A first step for DuPont was to establish a steering team that meets monthly to set objectives and drive the alignment.
The steering team set these objectives:
• Defining continuous improvement process for scope optimization without compromising safety;
• Developing the turnaround plan and training all execution team members and contractors on the changeover specific approach;
• Integrating capital projects and process hazard-assessment recommendations into the turnaround planning and scheduling process;
• Integrating detail decommissioning and commissioning activities into every changeover / turnaround.
To address the primary challenges of early work identification and change control, a core team comprised of maintenance, operations and projects meets weekly starting six to eight months before a non-routine turnaround to set KPIs and develop the integrated schedule.
Vaughn attributes the sustainability of the effort to the engagement and peer-to-peer accountability of all levels of employees and contractors in several new work processes that have taken root at the Mobile site:
• Early work identification;
• Turnaround readiness assessment (two to three months prior to start of turnaround);
• Single minute exchange of die, a very thorough check of logic in schedule, work-sequence optimization and identification of constraints;
• Checklists and improved packaging of “kit” for each work order;
• Add-on work-request process (requiring approval of the plant manager, site maintenance and engineering manager, and unit operations leader);
• Visual management of turnaround progression;
• Daily recap during execution phase of turnaround;
• Mechanical integrity & quality assurance risk assessments and contingency planning;
• Event critique.
Measuring the results
For the post-turnaround analysis, the site uses a web-based survey tool to capture “wins” and “opportunities for improvement.” Based on the results of this survey which is deployed two weeks after completion of the turnaround, a series of interactive critique sessions is planned to address specific learnings, with participation limited to those who can directly influence the desired change and those who are impacted by it.
Vaughn says the power of the integrated schedule owned by all work groups – maintenance, manufacturing, capital and contractors cannot be overstated. Also, the visual management board for daily progress tracking is a productive alignment tool.
The organization is becoming more effective at identifying and incorporating discovery work from inspections, says Vaughn.
At the Mobile site, there is always a turnaround of various durations in the planning cycle, and thus the challenge to prioritize, sequence and resource level the shutdown work of various production units. One lesson is that – due to resource constraints, tasks during power or steam unit outages should be limited to those facilities – site organization must resist the temptation to accomplish work in other units in parallel.