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Efficiency Task Force Toolkit

As well as individual company efforts to work smarter and reduce the cost base, Oil & Gas UK and its member companies are working together to tackle the fundamental behaviours that drive cost escalation in the UK Continental Shelf (UKCS) with the aim of creating a sustainable industry in a lower oil price world.

The Efficiency Task Force (ETF), launched in September 2015 and led by Oil & Gas UK, is intensifying its efforts to act as a catalyst to make the UKCS more resilient and as competitive as it possibly can be in the global marketplace.

To read more about how efficiency and collaboration initiatives are affecting the industry, please read the ‘The UKCS Upstream Supply Chain Collaboration Survey’ from Deloitte and Oil & Gas UK.

 

View our animation for more on the drive to improve the industry’s efficiency

Read the latest ETF Newsletter

 

 

Click on the toolkit below to find out more about the ETF’s work around the three themes of Business Process, Standardisation and Co-operation, Culture and Behaviours. For more information about any of the projects, contact [email protected]

 

3.2 Progress to Date

Over 50 success stories have been uploaded to the Rapid Efficiency Exchange so far. The Continuous Improvement Network now manages the project.

3.4 Tools

icon-download

ECTIB Toolkit

3.4 Next Steps

December will see the implementation of the Workforce Engagement Plan which includes developing the next phase of the Rapid Efficiency Exchange. The ETF proposes to run a series of Efficiency Roadshows in company offices as a way to engage the workforce in the pan-industry efficiency drive. These roadshows will be rolled out to Oil & Gas UK member companies in 2017.

3.4 Progress to Date

A HR network survey has been completed and a communications plan for workforce engagement has been developed.

3.4 Aims

Short-Term Aims

Effectively engage the workforce to contribute to the industry efficiency drive.

Long-Term Aims

Develop and promote the use of the Efficiency Task Force toolkit (including the Rapid Efficiency Exchange) to facilitate and maximise workforce engagement.

3.4 Overview

Team Leads: Mark Lappin (Oil and Gas Technology Centre), Roy Bruce (Unite Branch Sec), Steve Moir (Sky Futures, SME), Michael Wilkes (Shell), Nicky Mason (Amec Foster Wheeler) and Alix Thom (Oil & Gas UK)

Engage staff across the UKCS on the need to improve efficiency.

3.3 Next Steps

The formalisation and prioritisation of task finish groups with agreed goals will be complete for year’s end, and a continuous improvement training standards work group will be established.

3.3 Progress to Date

Twenty-seven companies are now involved with the network, with a member survey having been carried out in September 2016 to develop task finish groups. An Engineering Construction Industry Training Board (ECITB) feasibility study has also been completed for continuous improvement training standards.

3.3 Aims

Short-Term Aims

Provide an active body through which continuous improvement experts from the UKCS can work together to support industry delivery against the Industry Behaviours Charter principles and Efficiency Task Force project outputs

Long-Term Aims

Deliver project in accordance with outputs of task finish groups

3.3 Overview

Team Leads:  Gary Downs (Aker), Darren Clyde (Aker), Philip Oliver (Wood Group), Stuart Insch (Expro), Nick Readman (Total E&P UK) and Mariesha Jaffray (Oil & Gas UK)

Create a North-East Scotland network of oil and gas continuous improvement professionals to identify success stories and challenges from the industry.

3.2 Next Steps

In December 2016 a forum will be held to encourage sharing of continuous improvement challenges and to increase case study uploads via direct contact with Continuous Improvement Network members.

3.2 Aims

Short-Term Aims

Increase awareness of the Rapid Efficiency Exchange and encourage use as a reference point for good practice. Share case studies to highlight successful efficiency initiatives.

Long-Term Aims

For the Rapid Efficiency Exchange to become ‘second nature’ for companies – a place for the routine sharing of information and reference.

3.2 Overview

The Rapid Efficiency Exchange is a simple, swift and effective means of sharing best practices across the basin, and demonstrating individual and collective success in efficiency-related initiatives. It was launched in November 2015 with the hope that learning from each other will multiply successes and areas of excellence in the basin, and help bring to light more quickly emerging solutions to the sector’s efficiency challenges.

3.1 Next Steps

Deloitte carried out a follow-up collaboration survey of operators and suppliers this time, with the results to be presented at an Oil & Gas UK event in December 2016.

3.1 Progress to Date

Forty companies have signed the charter and committed to its principles. To measure how well industry is progressing against the charter’s principles, Oil & Gas UK partnered with Deloitte to survey the sector. The Collaboration Index is based on an electronic survey of suppliers to 13 operators carried out from March to April 2016. Feedback reveals that the sector is heading in the right direction and becoming more collaborative. See the Tools section for survey results.

3.1 Aims

Short-Term Aims

Increase awareness of the principles of the charter at all levels within the UK’s oil and gas industry.

Long-Term Aims

Recognition of co-operative behaviours as good practice by the global oil and gas community.

3.1 Overview

The Industry Behaviours Charter, signed by members of Oil & Gas UK and supported by the Oil and Gas Authority, is a collective commitment to work effectively, efficiently and co-operatively. It will be applied by every company, and to all activities, to achieve fundamental change for the UK’s offshore oil and gas industry.

2.5 Overview

Inefficiencies in maintenance routines are needlessly driving up costs.

2.5 Progress to Date

The Efficiency Task Force is championing work by Oil & Gas UK to optimise maintenance as part of a drive to continuously improve major accident hazard management and, in turn, operational efficiency.

In December 2015, Oil & Gas UK formed a work group (not part of the ETF) to bring together technical specialists in the fields of maintenance and asset integrity to share experiences and learnings on the topic of maintenance optimisation and how to tackle safety-critical maintenance backlog. The work group has produced a document on Maintenance Optimisation Reviews- Sharing Experience and Learnings to to help make sure maintenance regimes are fit for purpose.

2.5 Aims

Short-Term Aims

Sharing and adoption of good practice among companies to drive out inefficiencies in maintenance routines while maintaining high safety standards.

Long-Term Aims

The application of good practice across the UKCS.

2.4 Next Steps

Statoil and Plan Sea are carrying out analysis to determine the next steps and potential software development. A proposal will be presented to the Efficiency Task Force Steering Group and the Oil & Gas UK Board for Phase II.

2.4 Progress to Date

A test case in the Mariner area is examining how six operators – Statoil, BP, TAQA, EnQuest, Maersk, and Apache – can collectively optimise helicopter and vessel movements. Statoil, the operator for the Mariner field, is analysing the current cost of its operations (helicopter and freight movements) and working with other operators to determine optimum practice.

2.4 Aims

Short-Term Aims

Determine the potential impact of a regional cluster approach to logistics in the Mariner region to remove inefficiencies in logistics operations.

Long-Term Aims

Develop good practice guidelines for application across the UKCS and test applicability to other hubs.

2.4 Overview

Team Leads: Line Kaldestad (Statoil), Roger Brimmer (Apache), Ali Talpur (Enquest), Phil Murray (TAQA), Mark Hardie (BP), Elaine McEwan (Maersk), and Ken Cruickshank (Oil & Gas UK),

Logistics operations represent 8-14 per cent of operators’ annual costs, most of which are for helicopter and vessel operations. A cluster approach to logisitics across companies could reduce activity and realise substantial savings.

2.3 Tools

icon-downloadSupply Chain Code of Practice (SCCoP)
Code of Practice Information Pack
FPAL – Database of Suppliers
                    SCCoP Signatories
                    Tender Efficiency Framework
                    FPAL ITT data availability review
                    Sample invitation to tender cover letter
                    Procurement selection strategy matrix
                    Tender optimisation matrix

2.3 Next Steps

The tendering principles were shared with key supply chain representatives in October 2016 and were formally rolled out at Share Fair in November. A workshop is now scheduled for December to promote and implement these recommendations across industry, involving operators as well as contractor managing directors and supply chain managers. Information and guidance on the Tender Efficiency Framework will be available on this website in quarter 4 of 2016.

2.3 Progress to Date

A Tender Efficiencies Work Group has been established to identify duplication in the tender process and develop a Tender Efficiency Framework. Analysis of previous tenders from four contractors was carried out which identified a potential saving of £25 million, or 12-15 per cent, on the cost of industry tender response development. The relationships between purchaser and supplier companies will form a key part of realising these savings, achieved through Tender Optimisation, Minimising Duplication, Enhanced Behaviours and improvements in Tender Rationale.

2.3 Aims

Short-Term Aims

Determine the extent and nature of duplication in the tender process and the best steps to reduce or remove it.

Long-Term Aims

Develop good practice guidelines and provide proof of concept during the tendering process.

2.3 Overview

Team Leads: Martin Bruce (ENGIE) and Ken Cruickshank and Mariesha Jaffray (Oil & Gas UK)

Duplication and non-value adding activity in the tendering process has led to industry-wide inefficiencies in procurement. A work group comprising contractors and operators is exploring opportunities to simplify and standardise the tendering process.

2.2 Next Steps

The steering group will meet by mid-November to gather feedback on the trading platform and determine the next steps.

2.2 Progress to Date

Twenty-three companies from the oil, gas, construction, chemical and food processing sectors are now sharing information about a pool of over 200,000 inventory items on an online trading platform commissioned by the Efficiency Task Force. Companies are sharing resources to reduce individual stock holdings and cut lead times for access to vital equipment. The platform, developed by Ampelius Trading, holds items large and small, ranging from valves and drill bits, to gas turbines and subsea equipment.

2.2 Aims

Short-Term Aims

Determine appetite for and proof of concept of a shared cross-industry inventory management system.

Long-Term Aims

Document industry good practice for inventory management and establish a pool of commonly held items.

2.2 Overview

Team Leads: Andrew Taylor (Ampelius) and Ross Dornan and Ken Cruickshank (Oil & Gas UK)

Operators have significant quantities of ‘spare parts,’ many of which are obsolete and unused. They are now looking to rationalise their inventory holdings to reduce the costs associated with the storage and maintenance of materials.

2.1 Next Steps

In January 2017, the Efficiency Task Force will finalise and publish the good practice guidelines.

2.1 Progress to Date

The operators who are responsible for the bulk of compress system outages on the UKCS are working together to identify how to reduce the number and duration of these outages. An industry survey and root cause analysis was carried out, followed by a workshop in May 2016 to determine key compression system issues and improvement requirements to develop good practice guidelines.

2.1 Aims

Short-Term Aims

Determine the key drivers of compression system failures.

Long -Term Aims

Develop good practice guidelines for maintaining compression systems.

2.1 Overview

Team Leads: Alan Blacklaw (Nexen) and Matt Nicol (Centrica)

Unplanned shutdowns and maintenance account for substantial production losses with compression system outages the main cause, equating to the loss of a minimum of 40 million barrels of oil equivalent per year.

1.2 Next Steps

The savings identified will be verified by assessing specific industry case studies in quarter four of 2016 with good practice guidelines due by the end of the year.

1.2 Progress to Date

Progress to Date

A strawman project on current valve costs showed there was potential for a 30 per cent saving. Work has also begun on developing a process to reduce repair and inventory costs.

1.2 Aims

Short-Term Aims

Develop a collaborative supply chain approach to valve specification to reduce complexity and waste by minimising bespoke design, over-specification and certification.

Long-Term Aims

Create good practice guidelines for:

  • Inventory use
  • Repair versus new supply
  • Standardised specification and certification/documentation

1.2 Overview

Team Leads: Neil Kirkbride (Bel Valves), Ian Davidson (Score Group), Susan Ingram (Centrica), and Rebecca Borresen (Oil & Gas UK)

Engineering and procurement of new valves accounts for 10 per cent of operating and capital expenditure costs in a typical operating installation. Due to specification creep and a lack of standard specifications, re-use and sharing rates are low, resulting in large volumes of stagnant valve inventory. The Valves Group is exploring how companies can work together to reduce the costs associated with valve maintenance and supply across the basin.

1.1 Next Steps

The results from the second case study will be shared with tools developed for wider industry implementation.

1.1 Progress to Date

The Subsea Technology Work Group (30 companies) has analysed potential cost savings by carrying out projects to existing industry standards rather than bespoke requirements. It has demonstrated that savings of up to 30 per cent are possible. These findings were shared at operator engagement sessions in Aberdeen and London in May 2016. Since then, the work group has worked with two operators to optimise and tailor the good practice guidelines for application to real case studies. The benefits and savings realised from the first case study were presented at Share Fair in November 2016, which will be available to download from the Tools section after the event.

1.1 Aims

Short-Term Aims

Develop a simplified and standardised approach to subsea development design, manufacture and installation across the UKCS.

Long-Term Aims

Produce good practice guidelines and a proof of concept for application across the UKCS.

1.1 Overview

Team Leads: Steve Duthie and Guy Trumper (Technip) and Rebecca Borresen (Oil & Gas UK)

There are significant savings to be realised by adopting a simplified approach to project execution and through standardisation of subsea technology, eliminating non-value added specifications. The Subsea Technology Project is seeking to improve efficiencies through optimised solutions to achieve a reduced cost base.

Industry Dashboard

Production

2015 total production

1.65 mln
boe/d
10.4%

2016 total production forecast

1.69 mln
boe/d
~3%
2015 liquids production 0.96 mln boe/d
2015 net gas production 0.69 mln boe/d
2016 liquids production forecast 0.98 mln boe/d
2016 net gas production forecast 0.71 mln boe/d

Unit Operating Costs

2015 Average

$20.95/boe
-28%

2016 Forecast Average

~$16/boe
~-24%

Safety

2015 Three-year rolling average non-fatal injury rate per 100,000 workers

430

Total 2015 Hydrocarbon releases

87
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