Transforming the capital projects industry

MOSCOW (MRC) -- Is it time for a disruptive change in how the downstream construction industry executes projects? This question was proposed during the Rice Global Engineering & Construction Forum (RGF) roundtable, said Hydrocarbonprocessing.

Held monthly on the Rice University campus in Houston, Texas, the RGF roundtable discusses the latest challenges and opportunities facing the contracting side of the global engineering and construction industry.

Steve Cabano, President, Pathfinder, and Chair of CII, provided the keynote address at the Rice Engineering and Construction Forum luncheon. This month’s luncheon speaker featured Stephan Cabano, President, Pathfinder, and Chair of the 2019 Construction Industry Institute (CII). His presentation focused on the challenges facing the execution of capital project in the oil and gas industry and the latest advancements of the CII’s capital projects platform—Operating System 2.0.

"The majority of today’s major- to mega-capital projects do not meet cost and schedule expectations,” said Cabano, “nor do they meet their business expectations.” Statistics from the CII, NTNU and Bechtel show that nearly 95% of projects do not meet one or more of their business objectives, 70% of projects are not completed within 10% of budgeted cost and schedule, 98% of megaprojects experience cost overruns that average 80% over budget and 20 months late, and approximately 40% of capital is “wasted” on transactions.

Perhaps a new business model is needed? “At the end of the day, the owner basis his profit on the asset—selling product,” said Cabano, “the contractor makes its money on the project itself. At present, those are opposing incentives. We have got to get those closer together.” Cabano went on to discuss how the downstream construction industry is ripe for a change in project execution. Many industries have gone through disrupted changes—using Uber for transportation, renting hotels/homes through apps/websites, etc. A technology that could aide in a change for the construction industry could be Operating System 2.0.

A collaboration between the CII and the Construction Users Roundtable (CURT), Operating System 2.0 aims to redesign industry procedures and standards with current technological advances in mind. The hope is that Operating System 2.0 will make capital projects more financially viable and sustainable. This includes a dramatic reduction in time for planning, selecting, engaging, integrating and executing capital projects.
MRC

MOSCOW (MRC) -- Fujian Refining & Petrochemical (FREP) has undertaken an unplanned shutdown at its polypropylene (PP) unit in Fujian Province, according to Apic-online.

A Polymerupdate source in China informed that the company has halted operations at the unit owing to technical issues on July 12, 2019. The unit is slated to remain shut for about a week.

Located in Fujian province, China, the unit has a production capacity of 120,000 mt/year.

The company also operates other two PP plants at the same location with production capacity of 220,000 mt/year and 360,000 mt/year.

As MRC reported earlier, FREP restarted its No.3 PP plant in Fujian Province on September 23, 2018, following an unplanned outage. The plant was taken off-line on September 18, 2018 owing to a technical issues. Located in Fujian province, China, the No. 3 PP plant has a production capacity of 220,000 mt/year.

FREP is a joint venture between Fujian Petrochemical Co. (50%), ExxonMobil China Petroleum and Petrochemical Co. (25%) and Saudi Aramco Sino Co. (25%). Fujian Petrochemical is a 50:50 JV between Sinopec and the Fujian provincial government.
MRC

MOSCOW (MRC) -- Swiss packaging machinery and equipment supplier Sidel Group has signed onto the New Plastics Economy Global Commitment, a worldwide initiative launched by the Ellen MacArthur Foundation and UN Environment in 2018 to address the problem of plastic waste and pollution, said Canplastics.

The vision behind the New Plastics Economy Global Commitment includes ambitious goals, including taking action to eliminate problematic or unnecessary plastic packaging – through redesign, innovation, and new delivery models – as well as embracing reuse models with the aim of 100 per cent of all plastic packaging to be reusable, recyclable, or compostable.

Over 400 companies and corporations have already signed the New Plastics Economy Global Commitment, including companies representing 20 per cent of all plastic packaging produced globally such as Danone; H&M Group; L’Oreal; PepsiCo; The Coca-Cola Company; and Unilever. Major packaging supplies have also signed on, including Amcor; as well as plastics producers including Novamont.

“Technologically and industrially, PET, can and glass can all be recycled,” Luc Desoutter, sustainability officer at Sidel, said in a statement. “There is also an economical value in doing so: the value of a bale of PET bottles can range between 300 and 600 Euros per tonne, depending on its quality. PET can be brought back into the value chain, it shouldn’t be considered part of the problem. We are witnessing a significant shift in attitudes towards how PET is recycled and we want to use our engagement as part of the New Plastics Economy Global Commitment to support and promote this development towards maximum collection and recycling rates.”

Sidel has also formulated an ambitious set of targets of its own, Desoutter said, centred on its End to End approach, which takes into account the impacts created upstream and downstream in the value chain.
MRC

MOSCOW (MRC) -- US crude oil stockpiles fell by nearly 10 million barrels in the 1st week of July, far more than expected, as refineries processed the most crude oil since January, reported Reuters with reference to the Energy Information Administration.

Crude inventories fell by 9.5 million barrels in the week to July 5, compared with analysts’ expectations for a decrease of 3.1 million barrels.

Stocks have now fallen for four consecutive weeks, according to the EIA, and this week’s official data follows similar industry estimates from the American Petroleum Institute on Tuesday, which showed a large drop in stocks of 8.1 million barrels.

"The inventory draw was much stronger than expected and also exceeded the already huge draw reported by the API yesterday. This should push oil prices even higher,” said Carsten Fritsch, oil analyst at Commerzbank. “The U.S. oil market is clearly tightening."

Oil prices extended gains after the data. By 10:48 a.m. EDT (1448 GMT), US crude futures were up 3% at USD59.59 a barrel, while Brent gained 3% as well to USD66.06 a barrel.

The market was already higher before the data, partly due to numerous oil majors operating in the Gulf of Mexico shutting drilling facilities and evacuating staff ahead of a tropical cyclone forming in the Gulf, which is bringing high winds and storms.

Refinery crude runs rose by 148,000 barrels per day to hit 17.4 million bpd, the most since early January, responding to higher summer demand.

Refinery utilization rates rose by 0.5 percentage points to 94.7% of overall capacity, also their highest since January. That is even though refinery operations fell to 69.5% of capacity on the East Coast in the wake of the shutdown of the Philadelphia Energy Solutions complex, the largest in the region.

Gulf Coast operating rates were at nearly 98% of capacity - their most since December.

Gasoline stocks fell by 1.5 million barrels, near analysts’ expectations in a Reuters poll for a 1.3 million-barrel drop.

Distillate stockpiles, which include diesel and heating oil, rose by 3.7 million barrels, versus expectations for a 739,000-barrel increase, the data showed.

Net US crude imports fell in the first week of July by 341,000 bpd, while crude production edged up 100,000 bpd to 12.3 million bpd.

Crude stocks at the Cushing, Oklahoma, delivery hub for crude futures fell by 310,000 barrels, EIA said.
MRC

MOSCOW (MRC) -- Russia’s leading plastic pipe extruder Polyplastic Group has invested almost EUR1.5m to launch a production unit manufacturing new multi-layer pressure pipes for water, gas distribution and other applications, said Plasticsnewseurope.

This facility was recently inaugurated at the firm’s Klimovsk pipe plant site close to the capital, which employs 900 and produces a range of 10 mm to 3m diameter standard and corrugated polyethylene pipe.

The innovative ‘MULTIPIPE’ brand pressure pipe will be extruded on five new production lines just installed at Polyplastic’s latest plant extension. A workforce of 45 has been recruited for the operation, situated outside the industrial city of Podolsk.

“This workshop, with five modern lines to produce pressure pipes for water and gas supply and high-voltage electrical cables will allow us to manufacture (annually) an additional 20,000 tons of products,” explained Polyplastic Group’s president Lev Gorilovsky.

Klimovsk plant, set up in 2002, already provides work for nearly 900 employees and runs 25 extrusion lines with an annual output of some 60,000 tons of PE pipe on the 50,000m2 site. The new unit brings the site pipe capacity to 80,000 tons per year.

Much of the output from the new multilayer pipe facility is expected to meet the needs of major infrastructure projects in planned development programmes for the surrounding Moscow region.

“This is a truly innovative product – a multi-layer pipe for special applications with non-erasable and non-flammable inner layers,” Gorilovsky commented on the ‘MULTIPIPE’ product.

A number of industrial enterprises are now interested in using such polymer pipes, “since they are 4 – 5 times more durable than other types of pipe”, the Polyplastic group president added.

Last year, the Klimovsk operation, one of Europe’s biggest PE pipe producers, extruded around 50,000 tons of polyethylene into pipes. This represented about one fifth of the total output in Russia, according to Polyplastic.

The group, which also extrudes polypropylene and PVC-U pipe, is not only the country’s biggest plastic pipe manufacturer but also Russia’s leading plastics processor.
MRC