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© 2014 Chevron. All Rights Reserved.
Operational Excellence at
Chevron
Anne O’Neal
Global Manager, OE/HES, Oronite
Richmond, CA
August 18-20, 2014
AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
Overview
Energy is Essential
Chevron: Our Company and Our Operations
The Chevron Way: Getting Results the Right Way
What is Operational Excellence?
Operational Excellence Journey
Management System Process
Performance
2 AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
Energy Is Essential
3
© 2014 Chevron. All Rights Reserved.
Energy = Better Standard of Living
4
There are currently
1.3 billion people
across the globe
without access to
electricity.
© 2014 Chevron. All Rights Reserved.
Affordable and Reliable Energy
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We’ll Need All Forms of Energy
to Satisfy Demand
6
2035
Global Energy Demand It’s an
“and” world
Oil, natural gas, coal and nuclear
…and alternatives and renewables Geothermal, solar, wind and biofuels
…and energy efficiency The easiest, most cost-effective and
reliable form of “new” energy available Oil
Coal
Natural Gas
Renewables/Other
Nuclear
15%
7%
27%
23%
28%
© 2014 Chevron. All Rights Reserved. 7
Building a Common OE Vision
AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
Over 100 years…
Delivering energy to our customers
8
1907 Our first service station
was built in Seattle,
Washington
2014 Approaching 20,000 stations all across the
world, representing three brands
© 2014 Chevron. All Rights Reserved.
Chevron The Numbers
9
61,000 employees
2.6 million BOE daily net production
2.0 million BPD refining capacity
Operate globally in North America,
South America, Europe, Eurasia, Middle East, Africa and Asia-Pacific
AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
Chevron An Integrated Energy Company
10
Upstream Oil and natural gas
exploration and
production
Midstream Shipping and
pipeline
Downstream Manufacturing,
trading and
marketing of fuels,
lubricants and
chemicals
© 2014 Chevron. All Rights Reserved.
Upstream & Gas
11
Nearly 40 countries across 6 continents
Main activities
Exploration
Development – major capital projects
Production
Enhanced oil recovery
Acquiring new assets
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Upstream and Gas Operating in 40 Countries Across 6 Continents
12
Asia-Pacific
Africa and
Latin America
North America Europe, Eurasia and Middle East
Areas of Operation
© 2013 Chevron
Technical Challenges We must operate reliably today and grow for tomorrow
13
Expectations continue to increase
Internal/Company Communities Governments Investors
© 2014 Chevron. All Rights Reserved. AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
Downstream & Chemicals
15
Manufacturing 14 fuel refineries
Lubricants and chemicals Techron® fuel additive
Supply and marketing 18,000 branded outlets
© 2014 Chevron. All Rights Reserved.
The Chevron Way
16
© 2014 Chevron. All Rights Reserved.
Striving for an injury-
free workplace
Operating with industry-
leading integrity
and reliability
Identifying and mitigating
environmental
and process
safety risks
Maintaining the highest
standard of
environmental
stewardship
17
Protecting People and the Environment A Core Value
© 2014 Chevron. All Rights Reserved.
Operational Excellence Journey A Culture of Continuous Improvement
18
Policy 530
Core Value
Protecting
People and
Environment
Code of
conduct to
guide daily
decisions
System
approach for
performance
assurance
Best
practices
across the
enterprise
Complete
every task
the right way
every time
Culture
1990 2000 2010
AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
OE Management System (OEMS) Key Components
Chevron’s Overview of the OEMS Document is publically available at: chevron.com/about/operationalexcellence
OEMS addresses:
• Roles and Responsibilities
• Accountability
• Activities and Tasks
• OE Behaviors
• OE Processes and Standards
19
Leadership Accountability
Management System Process
OE Expectations
OE Management System
© 2014 Chevron. All Rights Reserved.
Operational Excellence Assurance Keeping the Layers of Protection in Place
20 AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2013 Chevron
Measuring Process Safety Performance Moving from lagging to leading metrics
Tier 1 – Significant LOPC events
Tier 2 – Events of Lesser Consequence
Tier 3 – Challenges to Safety Systems
Tier 4 – Management System Indicators
21
Measurement
Laggin
g Indic
ato
rs
Leadin
g Indic
ato
rs
Tier 1 Events
LOPC
Events of
Significant
Consequence
Tier 2 Events
LOPC Events of
Minor Consequence
Tier 3 Events
Challenges to Safety Systems
Tier 4 Events
Operating Discipline & Management System
Performance Indicators
© 2014 Chevron. All Rights Reserved. 22
Personal Safety Sustained Improvement
Chevron Days Away
From Work Rate
Chevron Total Recordable
Injury Rate
0.00
0.05
0.10
0.15
0.20
0.25
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
0.00
0.10
0.20
0.30
0.40
0.50
0.60
0.70
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved. 23
Benchmarking Performance &
Measuring Improvement
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Process Safety Striving for Excellence
24
Volume of Oil Spills
(>1bbl)
to Land and Water
Recordable Process
Fires in Chevron
Tier 1 Loss of
Containment
Incidents in Chevron
0
10
20
30
40
50
2003 2005 2007 2009 2011 YTD2013
0
20
40
60
80
100
120
2009 2010 2011 2012 YTD2013
0
10
20
30
40
50
2007 2009 2011 YTD2013
© 2014 Chevron. All Rights Reserved.
Managing Risk Continuing to enhance our capabilities
25
Technology Make technology
selections that
reduce risk
Tools Improve ability to
understand the risk
with better data and
models
Competency Develop competency
at all levels
AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
Setting Expectations What is required
Elements
Security of Personnel & Assets
Facility Design & Construction
Safe Operations
Management of Change
Reliability & Efficiency
Third Party Services
Environmental Stewardship
Product Stewardship
Incident Investigation
Community & Stakeholder
Engagement
Emergency Management
Compliance Assurance
Legislative & Regulatory
Advocacy
Corporate–wide requirements:
Put OE Processes and
Standards in place to manage
specific risks and/or
opportunities
There are 47 OE Expectations
categorized under 13 elements
26
Leadership Accountability
Management System Process
OE Expectations
OE Management System
AIChE / SAChE Faculty Workshop August 18-20, 2014
© 2014 Chevron. All Rights Reserved.
Operational Excellence Management System How we manage the elements of Process Safety
27
2
Facility Design &
Construction
3
Sale Operations
4
Management of
Change
5
Reliability &
Efficiency
6
Third Party
Services
9
Incident
Investigation
11
Emergency
Management
12
Compliance
Assurance
Corporate
Standard
Technical Codes
& Standards
Corporate Risk
Management
Process
Management of
Change Process
Corporate
Standard Asset
Integrity
Management
Contractor HES
Management
Process
Incident
Investigation
Process
Emergency
Management
Process
Corporate
Compliance
Assurance
Process
Operational
Readiness &
Pre-Start up
Procedures
Corporate
Standard
Process Safety
Information
Reliability &
Asset Integrity
Process
Corporate
Standard
Operating
Procedures
Managing Safe
Work Process
Training for
Process Safety
Competency
Leadership Accountability
Management System Process