Background
Hydrocarbon pipelines transport various forms of hydrocarbon-based products, primarily crude oil and natural gas. These pipelines serve as essential infrastructure for the energy industry, enabling the efficient and reliable transportation of hydrocarbons over long distances, often spanning hundreds or thousands of kilometres.
Our client is a leading transportation and midstream service provider that has been serving North America’s energy industry for over 60 years. They own an integrated system of pipelines that transports various hydrocarbon liquids and natural gas products.
The client also owns gas gathering and processing facilities, as well as an oil and natural gas liquids infrastructure and logistics business. The combination of integrated assets and commercial operations along the majority of the hydrocarbon value chain allow them to offer a full spectrum of midstream and marketing services to the energy sector.
Analysis
After a three-week analysis, we discovered room for process improvement in OPEX and CAPEX project management, as well as the daily pipeline management. From there, we laid out the roadmap for a 20-week transformation programme.
The goals of our programme were to design and implement new processes and behavioural changes that will sustain the client’s operations well into the future, and therefore achieving:
- Direct cost savings of between US$1.03 million to US$1.4 million through contracting and supply chain improvements
- Project and integrity dig Cost avoidance of between US$800,000 to $950,000
- Workable operational blueprint for five other pipeline operating districts
Project Approach & Implementation
The project was broken down into three workstreams:
WORKSTREAM I: MANAGEMENT CONTROL SYSTEM (MCS)
- Created new processes, reports, and dashboards to improve the efficiency of the operations and supervisory team. The dashboards include daily pigging runs and other duties assigned to field operators
- Implemented new tools that allowed employees to input data through mobile devices, uploaded daily and discussed in daily morning meetings.
WORKSTREAM II: SUPPLY CHAIN
- Created and implemented new processes to solicit, execute and sustain new vendor agreements.
- By following the new purchase order and supply chain rules installed during the project, the client was able to record immediate savings and enjoy year-over-year benefits.
WORKSTREAM III: CONTRACTOR MANAGEMENT AND CAPITAL PROJECT
- Handled the larger integrity projects and created a management system in order to properly plan, schedule and utilise contractors on major capital projects going forward.
- Created a new process and criteria to self-perform processes internally before contracting future work.
- The self-perform review and process has also allowed the client to cross-train employees and provide the workforce with new technical opportunities.
Results
At the end of the programme, we managed to surpass our initial financial estimates; savings from the implementation of solutions for Workstreams II and III ended up being greater than the initial goal of US$1.4 million.
We also helped the client utilise their current workforce more efficiently, in addition to helping supervisors spend more time in the field. Our new tools and processes also helped increase productivity by over 15% and eliminate late integrity tests and pig runs.
Productivity in the field significantly improved, and actual supervision and field management time increased because of the new streamlined management reporting and control system. Project were now being completed on time, at or below budget.
Overall, the new and improved supply chain and project order processes that we developed together with the client helped them save millions, improve vendor relationships, and foster a working culture that prioritises quality.
