Value Chain Integration - The Future for LNG

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

Stéphane Neuveglise

Product Marketing Manager – AVEVA MarineAVEVA Solutions Ltd

Published March 2010





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

Page 3

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 International Conference on Computer Applications in Shipbuilding (ICCAS 2009), in

September 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 trends

indicate strong growth in the development of similar vessels for

recovering and liquefying natural gas. However, the increased

complexity of floating LNG assets demand more efficient project

execution techniques if such challenging projects are to meet cost

and time budgets.

This paper describes how current technologies, forming an

integrated design environment for all major components, can be

employed to maximise project eff iciency.

The use of such an integrated environment enables closely

collaborative working between the principal engineering

disciplines. This eliminates many sources of potentially costly

design integration and interface errors, reducing rework, costs and

construction times.


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

This eliminates many sources of

potentially costly design integrationand 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 projects

in the last decade, and the industry’s continuing struggle to

complete these projects on time and within budget, have served to

highlight the challenges engineering faces in meeting the world’s

increasing energy demand.

As attention focuses on the potential of Liquefied Natural Gas (LNG)

to support this growth, the offshore industry is looking for ways to

improve project execution throughout its value chain.

Fully integrating the engineering IT across all partners in an

offshore project not only offers considerable scope for achieving

this, 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, due

to the costs of pipeline delivery over long distances. With more

limited options for oil discoveries, companies have turned their

attention to developing gas fields hitherto stranded, either in deep

water or in littoral areas where overland delivery is not economic.

The large number of such gas fields of varying size provides a large

potential resource, but many cannot be developed using

conventional LNG methods due to their insufficient size and/or

their distance from potential sites for onshore liquefaction.

There is also additional potential from offshore oil fields where any

associated gas is currently either reinjected, flared, or treated as a

cost. There is, therefore, a huge potential for easily deployable

floating 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 sophisticated

process plant mounted on some form of floating platform or vessel.

As immediate transfer by pipeline is not possible, this necessitates

local storage and offloading into purpose-built LNG tankers. In

deep water, oil extraction uses FPSOs; the same constraints demand

an equivalent solution for gas – the LNG FPSO or Floating LNG

(FLNG).

Tankers are designed and built by shipbuilders, and gas liquefaction

plants by process engineering companies. This immediately brings

massive engineering challenges. Commonly, each element of an

FPSO – hull, topsides and mooring system – is designed and

constructed by different contractors, each with their own particular

expertise and, more often than not, using different engineering IT

systems.

Each of these contractors faces their own problems of managing and

sharing engineering information between often geographically

dispersed teams of designers, suppliers, subcontractors and

construction sites. To these elements must now be added cryogenic

storage tanks – another specialist engineering task. And, to further

compound the difficulties, contracts for the various engineering

activities must often be placed while the scope of work is no morethan 10–15% completed, a common cause of project delays or cost

overruns.

With such technical and organisational complexity, a project of this

sort can resemble a modern-day Tower of Babel as the different

disciplines struggle to collaborate across time zones and technology

boundaries. A large project may have more than 75,000 engineering

interfaces, covering:

• structural

• piping and process

• electrical and instrumentation

• control

• safety

• documentation

• mooring systems.

The difficulties of integration are directly related to how accurately

these interfaces have been def ined. Unless all the integration

interfaces have been precisely engineered, the difficulties in

bringing all these elements together will invariably give rise to

design conflicts and costly rework. The preparedness and accuracy

of its design interfaces can make or break a project.


Page 6

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 Of fshore).



4. What If?

Focusing on their individual work scopes and schedules, contractors

normally coordinate their own interf ace management issues well,

and have little diff iculty in managing collaborative design on their

particular part of the project. Problems arise with cross-function

issues, cutting across multiple delivery teams and not sufficiently

visible either to the parties concerned or to programme

management.

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 contractual

boundaries?

What if approved design changes to the hull could be automatically

and immediately made visible to the topsides, mooring and tank

designers?

What if all the integration areas could be handled seamlessly in a

single 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 FLNG

facility could have online access to the entire evolving design

throughout the project and seamless, progressive handover of all

the documentation as it became available?

The good news is that such a situation is no longer an aspiration – it

is achievable now. Using off-the-shelf technology, major oil & gas

companies are already working in this way and gaining measurable

cost, risk and timescale reductions on major projects.

Extending this scope to the entire LNG value chain is now within

reach, thanks to AVEVA’s pioneering integration of the engineering

IT 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 design

platform, able to handle integrated hull and topsides design.

Plant engineers will be well aware of the established capabilities of

the AVEVA Plant applications, most particularly AVEVA PDMS, while

shipbuilders know AVEVA Marine, a comprehensive solution set

developed from Tribon. PDMS has already been used to create more

than 80% of the largest production platforms in the Gulf of Mexico

and the North Sea, while AVEVA Marine is used by 85% of the world’s

50 largest shipyards.

FPSOs have already been created using these two technologies but

the process previously required a degree of ‘hand knitting’. Today,

this limitation has disappeared and all disciplines can work on the

most complex FPSO project within a common IT environment.

Limitations on project scale and organisation have also virtually

disappeared thanks to the ability of all the participants to

collaborate using products such as AVEVA Global, which can

seamlessly handle parallel, multi-site working.

Before considering the potential for future developments, let’s first

look at some examples of where this technology is already being

used.


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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 of Mexico 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 different

components requires accurate as-designed and as-built

information.

For conversions of existing tankers, it is likely that neither an

existing 3D model nor accurate as-built 2D drawings will be

available. The as-built information therefore has to be obtained by

surveying the vessel. This is readily achieved with precision laser

scanning of the existing structure, to create 3D laser models which

can be seamlessly imported into AVEVA PDMS or AVEVA Outfitting.

Once imported, these as-built models can be used just like any other

3D elements, allowing new design to be created to fit accurately,

clash detection to be carried out, and the information to be shared

between project participants.

Once integrated with PDMS and Outfitting, as-built data can be

handled by other AVEVA tools, such as AVEVA Global for

collaborative multi-site working, or AVEVA Clash Manager for better

design quality.

This use of laser models is well established in the oil & gas industry,

but less so in shipbuilding, which has less frequent demand for

engineering modification of its products. The key to increasing its

adoption is simply to raise awareness among shipyards.


Page 8

‘For conversions of existing tankers,it is likely that neither an existing3D 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 laser scanning of the existing structure, to

create 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 eff icientconversion of even the most complex floating assets. Image courtesy AMEC.



7. Handover and Commissioning

Handover between EPC (or shipyard) and Owner Operator has long

been – almost literally – an ‘over-the- wall’ event. But the costs and

risks of this have risen as the rising price of oil demands earlier

revenue generation. Commissioning has therefore been squeezed

between the economic pressures to make it shorter and more

efficient, and the increasing amount of work created by increasing

project scale and more onerous regulatory requirements.

To overcome this, current best practice is to make handover and

commissioning an extended, parallel activity which begins while the

project is at an early stage of development. To take this to its full

potential requires effective collaboration between the two parties.

Both must be able to share information as it is generated. An

obvious example is the creation of operations and maintenance

procedures. If operations specialists can view the design as it

evolves, they can begin preparing procedures well in advance. They

can test their procedures on the 3D model and feed back

suggestions for ways to make the design more ‘operations friendly’.

The main barrier to such close collaboration has been the difficulty

of sharing the many different types of information involved, but

this 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 engineering

projects, from FEED, right through detailed design, construction,

commissioning, hook-up and throughout their entire operational

lives. AVEVA NET provides complete control and global visibility of

all project information, regardless of type or source. 3D models, 2D

schematics, procedures, schedules or vendor documents can all be

made accessible via the Internet through a single intuitive portal

application.

Now operations specialists in, say, maintenance, can view an

evolving design in 3D, without needing the skills or CAD tools of the

designers. They can review a vendor’s equipment maintenance

procedures, and work with the designers to ensure correct

accessibility is provided. Similarly, operational procedures such as

start-up, shutdown, shift changeover or evacuation can be drafted

early and refined progressively as the design evolves.

This level of practical, multi-discipline collaboration offers huge

potential for accelerating the Commissioning and Operational

Readiness phases of a project. Handover can become a progressive

activity and the project’s entire information asset passed seamlessly

into operations management to support lifecycle requirements such

as status monitoring, compliance reporting, Management of Change

control, and so on.


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AVEVA NET is a neutral, standards-compliant information management platform for the storage, sharing, cross-referencing, management and exploitation of every type

of 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 rapid

ramp-up to full capacity and reduced costs of asset ownership.

‘AVEVA NET provides completecontrol and global visibility of

all project information,regardless of type or source.3D models, 2D schematics,procedures, schedules or

vendor documents can all bemade accessible via theInternet through a singleintuitive portal application...’



8. Integrated FLNG - The Future

To meet the challenges and oppor tunities that FLNG presents,

integrating the engineering IT environment throughout the value

chain can bring considerable benefits in reducing the time and

costs of bringing gas to market, and in increasing the flexibility to

respond to changes in sources, demand and geopolitical

circumstances.

Not so long ago, standardising on, say, a single CAD platform could

be a hostage to fortune as technology raced ahead and made the

chosen platform obsolete. But thanks to the development of

neutral, standards-compliant information management, far from

being a straitjacket, a well-chosen and well-implemented IT

environment is a liberating asset in much the same way that a

common language enables global businesses to work as single

entities.

Consider a few practical possibilities. Cryogenic storage tanks may

become 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 and

eff iciently replicated as sister vessels. Asset management can be

extended across fleets of standardised vessels and plants.

Regulatory compliance reporting can be standardised and updated

across the entire value chain. Best practice information can be

shared 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 ships

needs to be done in the most efficient and cost-effective manner

possible.

By utilising the latest advances in engineering software it is now

possible to design all the major components of an FLNG vessel in

one design environment, wherever the project teams may be

located, bringing huge benefits in helping to eliminate interface

errors and their resulting rework costs and delays.

The ability also to progressively commission the vessel by providing

early access to design and related information has already produced

huge benefits in reduced commissioning time and costs.


Page 10

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 of an FLNG vessel in one designenvironment, wherever the project

teams may be located...’





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Documents

Value Chain Integration - The Future for LNG