PIP Overview

American Society for QualityDesign and Construction

DivisionSeptember 2005

PIPWorking in Harmony

Improving Capital & Maintenance Efficiency

Objectives

• Broaden understanding of PIP initiative.

• Raise awareness of PIP “value proposition”.

• Advocate “knowledge management” opportunity and quality of Practices.

• Display current state of PIP Practices.

• Validate PIP harmonization process and applicability to other industry segments.

Process Industry Practices

A consortium of companies sharing the goal of reducing

plant costs through development and

implementation of common industry practices for

detailed design, construction, procurement, operation, and maintenance of manufacturing facilities.

Value Proposition• Owners

– Project costs reduced. Estimated 2-5% reduction in Total Installed Costs. Application to maintenance work also.

• Contractors

– Visibility and working with clients.

• Owners and Contractors - Impact on internal standards effort and effective use of technical resources:

– Reduced creation / maintenance costs

– Capturing “knowledge & experience”

– Higher quality & consistently current

– Leveraging of scarce resources

– Networking opportunities within industry

PIP - “a small seed”

• PIP indeed began in 1992 as “a small seed”, planted and nurtured in the minds of a few visionaries for our industry.

The Small Seed “Is A Ladder Really Just A Ladder?”

PIP Member Consortium

• Fifteen members established PIP in 1993.

• Self-funded under CII.

• Now includes 37 U.S. process industry companies:

– 26 owners

– 11 EPC contractors

• Represents a significant share of the industry.

PIP Members: Owners

3M

Adv. Silicon Mat’ls.

Aramco Services

Arkema Inc.

BP

Celanese

Chevron Corp.

Citgo

ConocoPhillips

CYTEC

Degussa Corp.

DuPont

Eastman Chemical

Flint Hills Resources

FMC

Great Lakes Chemical

Honeywell

HOVENSA L.L.C.

Huntsman

Monsanto

PPG

Rohm and Haas

Shell Oil

Solutia

Sunoco

UOP

PIP Members: Contractors

Aker Kvaerner

BE&K

Bechtel

Burns & McDonnell

Chemtex International

Fluor

Jacobs

KBR

S&B E&C

Technip

WorleyParsons Ltd.

PIP Membership Requirements(1 of 2)

• Annual dues payment

• Active Steering Team participant

• At least one active qualified participant on a function team

• More active participation encouraged

PIP Membership Requirements(2 of 2)

• Provide internal non-proprietary standards for harmonization of industry Practices

• Input for Practices revisions

• Voluntarily adopt & implement Practices

• Follow PIP business guidelines

• Commitment to improvement of the process

PIP Vision

PIP Practices are:

• the “universal language” in the industry for engineering, procurement, and construction,

• widely recognized and available electronically,

• up to date, of high quality, and used essentially “as is”,

• voluntarily adopted and used by a majority.

WithPIP

INTRNL STDSINTRNL STDS

SOCIETYSOCIETY

STANDARDSSTANDARDS

INTERNALINTERNAL

STANDARDSSTANDARDS

INTERNALINTERNAL

STANDARDSSTANDARDSPIPPIP

SITE SPECIFICSITE SPECIFICSITE SPECIFICSITE SPECIFIC

BeforePIP

SOCIETYSOCIETY

STANDARDSSTANDARDS

Principles for Success(1 of 2)

Principles for Success(1 of 2)

•Participation is voluntary and open to all qualified.

•Funded & supported by participating companies.

•Develop recommended Practices based on existing company internal standards.

•Influence other organizations to adapt their standards to meet process industry needs.

•No duplication of work of others.

•Work only with non-proprietary information.

Principles for Success(2 of 2)

Principles for Success(2 of 2)

•High level of participation.

•Operate on “break-even” basis; small staff.

•Published Practices available for purchase by any interested party.

•Provide long-term support for updating.

•Use streamlined, short cycle time, technically sound process.

PIP Engineering DisciplinesPIP Engineering Disciplines

• Civil, Structural, Architectural

• Coatings, Insulation, and Refractory

• Electrical

• Machinery

• P&ID

• Piping

• Process Control and Analyzers

• Vessels (Includes shell & tube exchangers and tanks)

• Work Processes (Internal to PIP)

Organization

FUNCTION TEAM LEADERS

(FUNCTION TEAM LEADERS & SPONSORS)

PIP STEERING TEAM

EXECUTIVE COMMITTEE

FTS1 FTSn

FTLn

TASK TEAMS

TASK TEAMS

CSA

FTL1

TASK TEAMS

ELECTRICAL

FTL2

TASK TEAMS

CIR

FTL3

TASK TEAMS

MACHINERY

FTL4

TASK TEAMS

PIPING

FTL5

TASK TEAMS

P & I D

FTL6

TASK TEAMS

VESSEL

FTL7

TASK TEAMS

PROC CTL

FTL8

STANDING COMMITTEES

LEGAL

MARKETING

WORK PROCESSES

FTS2

STRATEGIC PLANNING

GLOBALIZATION

Practices by Discipline

4043

2031

6179

2130

6369

219234

2033

7 80

50

100

150

200

250

CSA CIR ELEC MACH PC PIPE VESS WPT

Published 451

Planned 527

Nu

mb

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of

Pra

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Members’ Reported Successes(1 of 2)

• More than 30 percent reduction in costs for maintaining internal company standards.

• Reduced valve inventory by 10 percent using PIP Practices.

• PIP Piping Practices save up to 1.6 percent of total installed cost and 2 weeks on schedule.

Members’ Reported Successes(2 of 2)

• Reduced piping group work hours by 25% on typical project.

• Saving $250,000 per year on annual maintenance of internal specifications.

• Reduced specification development and set-up time by 5-10%.

• Substantial reduction in hours required to develop/maintain valve data sheets.

Implementation Resource Center

• Member’s

addenda

• Systems

examples

• Success stories

• Tools

• Metrics

• Lessons Learned

(www.pip.org/members/irc/index.html)

Members’ Adoption and Implementation Data

• Adopted

• Plan to adopt

• Undecided

• Adoption not planned

• Implemented

(84% “as is”)

51%

12%

19%

17%

25%

Individual Practices

Data Collection Existing company standards

Data Analysis Define similarities,

differences

Model Development Align similarities and

harmonize

Model Test Industry “experts”

Model Application PIP Industry Practice

PIP Harmonization Process

PIP

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Member Companies Harmonizing

AdoptingProcess Industry

Engineering –Procurement –

Construction Process

Harmonization Potential

• Promote use of PIP as core for harmonizing EPC industry practices.

• Key adjunct to “knowledge management” strategy with loss of technical resources.

• Continue providing input to industry on standards and code development.

• Guide technology development and application.

• Help globalization of EPC industry practices.

PIP Impact: Industry “Voice”

• Actively interfaced with other industry groups (e.g. Hydraulic Institute, Steel Plate Fabricators Association, Material Technology Institute, National Insulation Association, etc.).

• Successfully petitioned International Building Code (IBC) for code exceptions on industrial equipment platforms.

PIP Impact:Collaborative and Joint Efforts

(1 of 2)

• API (American Petroleum Institute)– Machinery Installation (API RP 686)– Welding (API RP 582)– DCS Process Instrumentation & Control (API RP 554)– Other Standards Revisions

• ASME (American Society of Mechanical Engineers) – Pump Data Sheets (ASME B 73.1)– Granular Storage Bins & Tanks

• FIATECH (Fully Integrated & Automated Technologies)– AEX-XML Project for data sheets– Global Valve Cross-Reference eCatalog

PIP Impact:Collaborative and Joint Efforts

(2 of 2)

• ISA (Instrumentation Systems & Automation Society)– P&IDs (Piping & Instrumentation Diagram)– Safety Instrumented Systems Guidelines

• IEEE (The Institute of Electrical & Electronic Engineers)– Motor Data Sheets (IEEE 841)

• NIA (National Insulation Association)– Insulation Practices for National training

session

Globalization As A Priority

• Lack of globalization is seen as impediment to adoption.

• Most major projects now international and trend will continue.

• Globalization is a trend for all business sectors.

Global Distribution of PIP Practices

Australia

Brazil

Canada

France

Germany

Great

Britain

Indonesia

Italy

Japan

Korea

Saudi

Arabia

Spain

Trinidad

UAE

Purpose of Globalization Committee

• Develop strategies and action plans to enable use of PIPs outside U.S.

• Frame issues for presentation to Steering Team.

• Result should be phased action plan.

• Committee reports to Steering Team and will monitor, provide information regarding globalization progress.

Subscription Program

• Annual electronic subscription (PDF files and Electronic Entry Data Sheets from PIP web site)

• Potential subscribers:

– Owners and contractors unable to commit resources to participate

– Suppliers and vendors

• Cost - All Practices $30K per year (currently discounted from $33K):

- or by discipline ($500 - $6K )

PIP Subscribers

Agrium*

Ambitech Engineering

Arrington Companies

Canadian Natural Resources Limited (CNRL)

Carboline

Coffeyville Resource Refining

& Marketing LLC*

Emerson Process Management

GE Energy

GE Silicones-OSI Specialties*

Invista*

Kraton Polymers*

Petroleum Company of Trinidad & Tobago*

Phoenix Park Gas Processors Ltd.*

Saudi Basic Industries (SABIC)*

Saudi International Petro-chemical Co. (SIPCHEM)*

Sherwin Williams

Southern Company*

Stone & Webster Ltd.*

The Williams Companies*

WMC Resources Ltd.

Licensing Program

• Available to related e-commerce providers, systems developers, and value-added resellers.

• Allows including PIP Practices and derivatives in licensee’s product.

• Significant P&ID application

• Educational institutions

PIP Licensees

ASME

Aspen Technology

Aveva

Bentley Systems

Conestoga College

IEEE

Intergraph

ISA

National Insulation Association

St. Paul Technical College

Universidad Nacional Autonoma de Mexico

University of South Dakota

PIP Successes

• “Case for Change” development

• Published over 450 PIP Practices

• Collaboration with Standards Development Organizations (SDO)

• Membership, Subscription, and License growth

• PIP is heard as an “industry voice”

• Enabling global application of Practices

Practices DistributionPractices Distribution

Copyright:

•“Process Industry Practices, Construction Industry Institute, The University of Texas at Austin”

Distribution:

•Member companies as benefit of membership

•Unlimited right to copy for members and subscribers

•Electronic to members and subscribers

•Paper copies to non-members

Value Proposition for PIP

• Reduced Costs for:

– Projects and Maintenance

– Maintaining internal standards

– Commodity equipment procurement

– Detail design and construction hours

• Reduced inventories of valves and piping materials

• Improved “Knowledge Management” & Quality:

– Fewer spec conflicts and code inconsistencies

– Alignment with industry “Best Practices”

– Widespread understanding of common specs

Driving Greater Capital and Maintenance Efficiency

Visit us on the Web

www.pip.org