Value Chain Integration - The Future for LNG?€¦ · Value Chain Integration - The Future for LNG?...

Value Chain Integration - The Future for LNG?An AVEVA White Paper

Stéphane NeuvegliseProduct Marketing Manager – AVEVA Marine

AVEVA Solutions Ltd

Published March 2010

Value Chain Integration - The Future for LNG? - an AVEVA White Paper

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Summary

1. Introduction

2. The LNG Opportunity

3. The FLNG Challenge

4. What If?

5. What With?

6. Tanker Conversions

7. Handover and Commissioning

8. Integrated FLNG - The Future

9. Conclusion

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Contents

This article has been adapted from a paper given at the InternationalConference on Computer Applications in Shipbuilding (ICCAS 2009), inSeptember 2009, organised by the Royal Institution of Naval Architects(RINA). It is reproduced with the permission of RINA.

Summary

FPSO use within the oil & gas industry is well established and trendsindicate strong growth in the development of similar vessels forrecovering and liquefying natural gas. However, the increasedcomplexity of floating LNG assets demand more efficient projectexecution techniques if such challenging projects are to meet costand time budgets.

This paper describes how current technologies, forming anintegrated design environment for all major components, can beemployed to maximise project efficiency.

The use of such an integrated environment enables closelycollaborative working between the principal engineeringdisciplines. This eliminates many sources of potentially costlydesign integration and interface errors, reducing rework, costs andconstruction times.


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‘...an integrated environment enablesclosely collaborative working betweenthe principal engineering disciplines.

This eliminates many sources ofpotentially costly design integration

and interface errors, reducing rework,costs and construction times...’

Photograph courtesy of Kawasaki Shipbuilding Corporation.

1. Introduction

The increase in large-scale, multinational offshore oil & gas projectsin the last decade, and the industry’s continuing struggle tocomplete these projects on time and within budget, have served tohighlight the challenges engineering faces in meeting the world’sincreasing energy demand.

As attention focuses on the potential of Liquefied Natural Gas (LNG)to support this growth, the offshore industry is looking for ways toimprove project execution throughout its value chain.

Fully integrating the engineering IT across all partners in anoffshore project not only offers considerable scope for achievingthis, it is now achievable with proven, off-the-shelf technology.

You just have to join the dots...

2. The LNG Opportunity

Until recently, natural gas has been essentially a regional fuel, dueto the costs of pipeline delivery over long distances. With morelimited options for oil discoveries, companies have turned theirattention to developing gas fields hitherto stranded, either in deepwater or in littoral areas where overland delivery is not economic.

The large number of such gas fields of varying size provides a largepotential resource, but many cannot be developed usingconventional LNG methods due to their insufficient size and/ortheir distance from potential sites for onshore liquefaction.

There is also additional potential from offshore oil fields where anyassociated gas is currently either reinjected, flared, or treated as acost. There is, therefore, a huge potential for easily deployablefloating liquefaction units.


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‘As attention focuses on the potential of Liquefied Natural Gas (LNG) to supportthis growth, the offshore industry is looking for ways to improve project executionthroughout its value chain. Fully integrating the engineering IT across all partners

in an offshore project not only offers considerable scope for achieving this, it isnow achievable with proven, off-the-shelf technology...’

3. The FLNG Challenge

Gas needs to be liquefied as soon as it is drawn from the reservoir.An offshore liquefaction facility is a complex and sophisticatedprocess plant mounted on some form of floating platform or vessel.

As immediate transfer by pipeline is not possible, this necessitateslocal storage and offloading into purpose-built LNG tankers. Indeep water, oil extraction uses FPSOs; the same constraints demandan equivalent solution for gas – the LNG FPSO or Floating LNG(FLNG).

Tankers are designed and built by shipbuilders, and gas liquefactionplants by process engineering companies. This immediately bringsmassive engineering challenges. Commonly, each element of anFPSO – hull, topsides and mooring system – is designed andconstructed by different contractors, each with their own particularexpertise and, more often than not, using different engineering ITsystems.

Each of these contractors faces their own problems of managing andsharing engineering information between often geographicallydispersed teams of designers, suppliers, subcontractors andconstruction sites. To these elements must now be added cryogenicstorage tanks – another specialist engineering task. And, to furthercompound the difficulties, contracts for the various engineeringactivities must often be placed while the scope of work is no morethan 10–15% completed, a common cause of project delays or costoverruns.

With such technical and organisational complexity, a project of thissort can resemble a modern-day Tower of Babel as the differentdisciplines struggle to collaborate across time zones and technologyboundaries. A large project may have more than 75,000 engineeringinterfaces, covering:

• structural• piping and process• electrical and instrumentation• control• safety• documentation• mooring systems.

The difficulties of integration are directly related to how accuratelythese interfaces have been defined. Unless all the integrationinterfaces have been precisely engineered, the difficulties inbringing all these elements together will invariably give rise todesign conflicts and costly rework. The preparedness and accuracyof its design interfaces can make or break a project.


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A ship, a mooring buoy and a process plant. Integrating such complex projects efficiently is the challenge facing the offshore oil & gas industry. (Photo courtesy SBM Offshore).

4. What If?

Focusing on their individual work scopes and schedules, contractorsnormally coordinate their own interface management issues well,and have little difficulty in managing collaborative design on theirparticular part of the project. Problems arise with cross-functionissues, cutting across multiple delivery teams and not sufficientlyvisible either to the parties concerned or to programmemanagement.

What if the entire design could be handled within one fully-integrated system bringing together all partners and stakeholders,whatever their location, but respecting their contractualboundaries?

What if approved design changes to the hull could be automaticallyand immediately made visible to the topsides, mooring and tankdesigners?

What if all the integration areas could be handled seamlessly in asingle design system so that changes in one are visible across all,and inconsistencies at the integration levels checked automatically?

Going one step further, what if the Owner Operator of an FLNGfacility could have online access to the entire evolving designthroughout the project and seamless, progressive handover of allthe documentation as it became available?

The good news is that such a situation is no longer an aspiration – itis achievable now. Using off-the-shelf technology, major oil & gascompanies are already working in this way and gaining measurablecost, risk and timescale reductions on major projects.

Extending this scope to the entire LNG value chain is now withinreach, thanks to AVEVA’s pioneering integration of the engineeringIT solutions for process plant and shipbuilding.

5. What With?

Over the last few years, AVEVA Solutions has integrated best-in-class plant and marine engineering IT onto a single designplatform, able to handle integrated hull and topsides design.

Plant engineers will be well aware of the established capabilities ofthe AVEVA Plant applications, most particularly AVEVA PDMS, whileshipbuilders know AVEVA Marine, a comprehensive solution setdeveloped from Tribon. PDMS has already been used to create morethan 80% of the largest production platforms in the Gulf of Mexicoand the North Sea, while AVEVA Marine is used by 85% of the world’s50 largest shipyards.

FPSOs have already been created using these two technologies butthe process previously required a degree of ‘hand knitting’. Today,this limitation has disappeared and all disciplines can work on themost complex FPSO project within a common IT environment.

Limitations on project scale and organisation have also virtuallydisappeared thanks to the ability of all the participants tocollaborate using products such as AVEVA Global, which canseamlessly handle parallel, multi-site working.

Before considering the potential for future developments, let’s firstlook at some examples of where this technology is already beingused.


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With AVEVA PDMS and AVEVA Outfitting able to share data, integrating complexprocess plant into a vessel becomes a manageable, designer-to-designer process,with access to all the usual productivity functions, such as clash management.

‘...PDMS has already been used tocreate more than 80% of the largest

production platforms in the Gulf ofMexico and the North Sea, while

AVEVA Marine is used by 85% of theworld’s 50 largest shipyards...’

6. Tanker Conversions

For any floating processing plant, integrating the differentcomponents requires accurate as-designed and as-builtinformation.

For conversions of existing tankers, it is likely that neither anexisting 3D model nor accurate as-built 2D drawings will beavailable. The as-built information therefore has to be obtained bysurveying the vessel. This is readily achieved with precision laserscanning of the existing structure, to create 3D laser models whichcan be seamlessly imported into AVEVA PDMS or AVEVA Outfitting.

Once imported, these as-built models can be used just like any other3D elements, allowing new design to be created to fit accurately,clash detection to be carried out, and the information to be sharedbetween project participants.

Once integrated with PDMS and Outfitting, as-built data can behandled by other AVEVA tools, such as AVEVA Global forcollaborative multi-site working, or AVEVA Clash Manager for betterdesign quality.

This use of laser models is well established in the oil & gas industry,but less so in shipbuilding, which has less frequent demand forengineering modification of its products. The key to increasing itsadoption is simply to raise awareness among shipyards.


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‘For conversions of existing tankers, it is likely that neither an existing 3D model nor accurate as-built 2Ddrawings will be available. The as-builtinformation therefore has to beobtained by surveying the vessel. Thisis readily achieved with precision laserscanning of the existing structure, tocreate 3D laser models which can beseamlessly imported into AVEVA PDMSor AVEVA Outfitting...’

High-resolution, phase-based 3D laser scans like this, integrated with AVEVA 3D design tools, enables the efficientconversion of even the most complex floating assets. Image courtesy AMEC.

7. Handover and Commissioning

Handover between EPC (or shipyard) and Owner Operator has longbeen – almost literally – an ‘over-the- wall’ event. But the costs andrisks of this have risen as the rising price of oil demands earlierrevenue generation. Commissioning has therefore been squeezedbetween the economic pressures to make it shorter and moreefficient, and the increasing amount of work created by increasingproject scale and more onerous regulatory requirements.

To overcome this, current best practice is to make handover andcommissioning an extended, parallel activity which begins while theproject is at an early stage of development. To take this to its fullpotential requires effective collaboration between the two parties.Both must be able to share information as it is generated. Anobvious example is the creation of operations and maintenanceprocedures. If operations specialists can view the design as itevolves, they can begin preparing procedures well in advance. Theycan test their procedures on the 3D model and feed backsuggestions for ways to make the design more ‘operations friendly’.

The main barrier to such close collaboration has been the difficultyof sharing the many different types of information involved, butthis barrier, too, is disappearing thanks to new ‘data agnostic’information management technologies such as AVEVA NET.

AVEVA NET is a powerful solution for the workflow and lifecycleinformation management requirements of complex engineeringprojects, from FEED, right through detailed design, construction,commissioning, hook-up and throughout their entire operationallives. AVEVA NET provides complete control and global visibility ofall project information, regardless of type or source. 3D models, 2Dschematics, procedures, schedules or vendor documents can all bemade accessible via the Internet through a single intuitive portalapplication.

Now operations specialists in, say, maintenance, can view anevolving design in 3D, without needing the skills or CAD tools of thedesigners. They can review a vendor’s equipment maintenanceprocedures, and work with the designers to ensure correctaccessibility is provided. Similarly, operational procedures such asstart-up, shutdown, shift changeover or evacuation can be draftedearly and refined progressively as the design evolves.

This level of practical, multi-discipline collaboration offers hugepotential for accelerating the Commissioning and OperationalReadiness phases of a project. Handover can become a progressiveactivity and the project’s entire information asset passed seamlesslyinto operations management to support lifecycle requirements suchas status monitoring, compliance reporting, Management of Changecontrol, and so on.


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AVEVA NET is a neutral, standards-compliant information management platform forthe storage, sharing, cross-referencing, management and exploitation of every typeof asset information, from 3D models to vendor documents.

A leading oil & gas company found that effective information management brings measurable economicbenefits through earlier and more complete definition of engineering information. This enables more rapidramp-up to full capacity and reduced costs of asset ownership.

‘AVEVA NET provides completecontrol and global visibility ofall project information,regardless of type or source.3D models, 2D schematics,procedures, schedules orvendor documents can all bemade accessible via theInternet through a singleintuitive portal application...’

8. Integrated FLNG - The Future

To meet the challenges and opportunities that FLNG presents,integrating the engineering IT environment throughout the valuechain can bring considerable benefits in reducing the time andcosts of bringing gas to market, and in increasing the flexibility torespond to changes in sources, demand and geopoliticalcircumstances.

Not so long ago, standardising on, say, a single CAD platform couldbe a hostage to fortune as technology raced ahead and made thechosen platform obsolete. But thanks to the development ofneutral, standards-compliant information management, far frombeing a straitjacket, a well-chosen and well-implemented ITenvironment is a liberating asset in much the same way that acommon language enables global businesses to work as singleentities.

Consider a few practical possibilities. Cryogenic storage tanks maybecome standardised modules for use both on- and offshore.Liquefaction and gasification plants can reuse modular designs.LNG FPSOs can be created as single, integrated projects andefficiently replicated as sister vessels. Asset management can beextended across fleets of standardised vessels and plants.Regulatory compliance reporting can be standardised and updatedacross the entire value chain. Best practice information can beshared easily and kept available for reuse.

9. Conclusion

Huge future demand for energy means huge demand for FLNG;translating that demand into the complex reality of FLNG shipsneeds to be done in the most efficient and cost-effective mannerpossible.

By utilising the latest advances in engineering software it is nowpossible to design all the major components of an FLNG vessel inone design environment, wherever the project teams may belocated, bringing huge benefits in helping to eliminate interfaceerrors and their resulting rework costs and delays.

The ability also to progressively commission the vessel by providingearly access to design and related information has already producedhuge benefits in reduced commissioning time and costs.


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Is this the future? Large-scale offshore LNG recovery is now a practical proposition.

‘By utilising the latest advances inengineering software it is now possibleto design all the major components ofan FLNG vessel in one designenvironment, wherever the projectteams may be located...’

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AVEVA believes the information in this publication is correct as of its publication date. As part of continued product development, such information is subject to change without prior notice and isrelated to the current software release. AVEVA is not responsible for any inadvertent errors. All product names mentioned are the trademarks of their respective holders.

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