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Transforming the capital projects industry

July 16/2019

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 months 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 CIIs capital projects platformOperating System 2.0.

"The majority of todays 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 assetselling 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 changesusing 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.


mrcplast.com
Author:Anna Larionova
Tags:petroleum products, petrochemistry, petrochemistry.
Category:General News
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