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Refinery Overhauling Introduction

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Refinery Overhauling Introduction

Refinery Overhauling Introduction

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  • 1. Project Initiation Presentation by Ashar Ahmed Basit Sultan
  • 2. BUSINESS CASE
    • A). Business Problem:
      • 1). Environmental Analysis:
        • Change in company vision and incorporation of Total Productive Maintenance Strategies.
        • The high demand of POL products push for 24x7 production.
        • Decreasing profit margin call for increased efficiency and productivity.
        • Equipment Integrity Requirements.
        • Safety Requirements.
    /11
  • 3. BUSINESS CASE Continued…
        • 2). Core Business Problems:
        • The refining plant, utilities and associated infrastructure of the refinery needs major overhauling as it is kept under peak utilization throughout the year du to heavy demand.
        • Random breakdown of equipments have caused considerable downtime and make shift arrangements need to be rectified properly.
        • The major overhauling should take less time as compared to average downtime without overhauling.
    /11
  • 4. BUSINESS CASE Continued…
      • 3). Core Business Opportunity:
        • The demand for POL products during winter season from Dec 2009 to Mar 2010, will remain low as indicated by the time scale analysis of previous 10 years. So, the major overhauling activity can be done by shutting down production during this season.
        • Also the slowdown of economic activity due to Global Recession indicates that the demand during Dec 2009 to Mar 2010 will remain considerably low.
        • Seizing this opportunity will enable the refinery to continue safe, uninterrupted and efficient operations in the future.
    /11
  • 5. BUSINESS CASE Continued…
    • B). Assess the Available Options:
      • 1). Option:
        • The One and Only option is “Production Shutdown for 15 days and perform Inspection, Maintenance, Upgradation of all plant equipment, facilities and infrastructure”.
      • 2). Quantification of Benefits:
        • Financial  Reduction in cost = Rs. 30 Mn
        • Operational  Improved operational efficiency = 95%
        • Reduced downtime cost = Rs. 10 Mn
        • Reduced maintenance cost = Rs. 50 Mn
        • Market  Continued product supply
        • Customer  Consistent product quality
    /11
  • 6. BUSINESS CASE Continued…
      • 3). Forecast the Cost:
    /11 Expense Category Expense Description Expense Value Expense Type People Salaries of project staff Contractors / outsources parties Rs. 5 Mn Rs. 2 Mn OPEX CAPEX Physical Equipment and Material Tools and Machinery Rs. 20 Mn Rs. 3 Mn OPEX OPEX Marketing Announcements and Communication Rs. 0.1 Mn OPEX Organizational Downtime Rs. 3 Mn OPEX Total Cost Rs. 33.1 Mn
  • 7. BUSINESS CASE Continued…
      • 5). Identify the Risk:
    /11 Risk Description Risk Likelihood Risk Impact Actions Required to Mitigate Risk Inability to complete project on time i.e. within 15 days High High Careful and thorough planning Additional expenditure may occur Medium High Scope re-verification during planning Critical demand situation during shutdown Low Medium Maintain Safety stock of Oil during project
  • 8. BUSINESS CASE Continued…
    • D). Implementation Approach:
      • Carry out inspections, determine previous, existing defects, modifications for safety requirements, improvements etc.
      • Create a list of all overhauling and maintenance activities to be carried out.
      • Plan activities, resources, schedules, manpower, communication etc.
      • Tightly integrate planning and execution by continuous monitoring and controlling.
      • Close the project and commission the plant.
    /11
  • 9. TERMS OF REFERENCE
    • A). Project Charter:
      • To carry out major overhauling of the whole refinery by accurately estimating and implementing the maintenance and up gradation requirements for improving plant efficiency and minimize down time.
      • This project will involve all teams of maintenance, operations, projects, HSE, Procurement, Finance and Marketing departments under the guidance of a Steering Committee and Cross Functional Sub-Committees.
      • Project planning will start well before the opportunity window in this winter to allocate resources, line-up any outsourcing requirements or import items. All activities will be monitored continuously for obtaining the perceived benefits.
    /11
  • 10. TERMS OF REFERENCE Continued…
    • B). Project Organization
      • 1). Customers:
        • Operations Department for improved efficiency
        • Maintenance Department for increased reliability
      • 2). Stakeholders:
        • Customers of the company products
        • Refinery Management
        • Operations Department
        • Maintenance Department
        • Safety Department
    /11
  • 11. PROJECT OBJECTIVE STATEMENT (POS)
    • To accomplish the overhauling of complete refining plant and their utilities by shutting down all production operations for 15 days starting in Feb 2010 and using Rs. 33.1 Million.
    /11