Integrated Delivery of Supply Chain Solutions Canada’s oil & gas sector shares similar supply chain challenges; • Lack of replication in approach to similar scopes • Inconsistent communication among project teams • Inability to mobilize suppliers quickly • Duplication of activities resulting in unnecessary costs and resources Integrated Approach to Project Delivery Through the delivery of 5C Contracts’ integrated supply chain solution, oil and gas producers are enabled to: • Standardize and replicate process through the 5C Contracts approach • Compress project timelines by enabling interdependence among project teams • Streamline the development of long- term, strategic partnerships and leverage schedule and cost advantages OVERVIEW 5C Contracts Ltd. Ian Carr (403) 813-5607 1
Transcript
Integrated Delivery of Supply Chain SolutionsCanada’s oil & gas sector shares similar supply chain challenges;• Lack of replication in approach to similar scopes• Inconsistent communication among project teams• Inability to mobilize suppliers quickly• Duplication of activities resulting in unnecessary
costs and resources
Integrated Approach to Project Delivery Through the delivery of 5C Contracts’ integrated supply chain solution, oil and gas producers are enabled to: • Standardize and replicate process through the 5C
Contracts approach• Compress project timelines by enabling
interdependence among project teams• Streamline the development of long-term, strategic
partnerships and leverage schedule and cost advantages
OVER
VIEW
5C Contracts Ltd.Ian Carr
(403) 813-5607
1
Driving Supply Chain Value
Strategic Vision for Supply Chain Management• Benchmarking Innovation
Contractual & commercial alignment to ensure continuous improvement
• Strategic Evergreen Partnerships among engineering, suppliers and construction firms to streamline schedule & reduce lead times
• Assess Existing Initiatives to validate baseline processes
• One-Team life cycle approach
• Predictable, Streamlined Deployment of resources to ensure a consistent outcome
3 Reasons to Contact 5C Contracts Ltd.1. 30+ years of international
supply chain expertise, 12+ within Canada’s oil & gas sector
2. Trusted advisor in helping clients achieve immediate and sustainable results
3. Tailored solutions to meet the expectations of large and small companies (one size does not fit all)
Understanding the ApproachReview current process among each stakeholder group. Key areas of discovery include:• Understanding decision points• Timing & sequence, durations• Interfaces with internal & external stakeholders• Risks and restrictions• Resources & budgets
SUM
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CHReservoir Development Surface land Drilling &
Completions Engineering Supply Chain Construction C & SU O & M Reclamation ???????
Aboriginal County Local Provincial Environmental Federal Market ????
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Lean ProcessIntroduced at the beginning to indicate the importance attached to streamlining every facet of a process to deliver anything; this occurs throughout the journey. Part 1• Reverse engineer current process to identify and remove
float, redundancy and duplication (apply Lean principles)
• Develop cost structure (BoQ/BoM)• Clarity around risks and decision points• Identify opportunities for process change• Develop list of known predictable variables• Output = optimum schedule with current process• Output = restrictors to change identified• Output = list of potential additional improvements• Output = Cost / schedule structure to measure all
improvements against
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Lean ProcessPart 2• Review and counter restrictors• Develop potential improvements and build into
schedule• Establish in principle solutions to variables• Engage market on principles• Output = further optimized schedule• Output = list of restrictors requiring senior exec’ help• Output = variables reduced to options
Part 3• DESIGN IMPROVEMENT DECISION
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Notes on Case Study• The following was
developed to highlight significant opportunities in the delivery of Well Pads for a 35kb/d SAGD client
• The approach is as relevant to SAGD as with any other replicable scope of work such as:• SAGD central processing
• Cost details have been removed for reasons of confidentiality
• A facilitated approach maximising input from the market to assist engineering and other disciplines’ decisions, producing optimum design, streamlining fabrication and installation to maximize benefits to all across the board. It is not discipline centric
• Although produced for the oil & gas market, any product, service or facility required for any industry from fast food to communications would see major benefits in this approach
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First Steam in Ten MonthsChanging how Well Pads are delivered & operated
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Objective• Reduce time to first steam from current 20 – 30
months to 10 months.• Provide (company) with maximum flexibility in
their business decisions around when well pads are started
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Key Assumptions• After Regulatory approval, Well Pads take 20 to 30
months to first steam• Life expectancy 7 to 10 years• Sustainment plans up to X per year….. for next 20
years +• Approx. 50 PO’s for materials & equipment per
pad, excluding Contracts and revisions (PO rev circa 90+)
• Some equipment has lead times of up to 60 weeks (pumps, some valves 50+ weeks)
• Predictable variables from one pad to another are; elevation, orientation, well pairs (# & spacing), distance from CPF
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Well Pad Capital Costs
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Common/average cost Well pair 7 pair 9 pair 10 pair
Surface Lands
(inc. flowline clearing)
Drilling
Completions
Commissioning
Facilities*
* Estimates with indirect (Construction) pro-rated values.
All cost excluding Facilities provided by Development.
Drilling Average of scoping estimates for OO/PP & G
No flowline costs incl' in Facilities Estimates, Flowline per Km approx. $M per Km.
Average $
Financial cost details removed to protect confidential information. Slide left in to show components needed to produce proxy costing. 10
Essential Elements• Innovation in design• Innovation in Supplier & Contractor relationships
and their inclusion in the design development• Change to budgets – Lifecycle not separating
Capex from Opex• Full SMM BoQ and BoM for each Well Pad pairing
configuration• Collect data on all aspects of the installation and
maintenance• Capital side and Operations to be one team• Inventory!
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Supply Chain Perspective• Tactical activities are currently repeated every
time we build a new Well Pad • Too much focus on initial cost• Focus should be on lifecycle not initial cost• Evergreen Contractors and suppliers to be
developed & managed• Baseline performance data collection key to
stepped incremental improvements in safety, quality, schedule, labour productivity, maintenance, reliability and costs
• Environmental, local and aboriginal aspects included from the beginning
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Advantages• 10 month delivery
affords Development the opportunity to be flexible and creative in their Well Pad scheduling
