Embedded software solutions: three tools

for asset management cost reduction

Asset management software is the key to optimisation

The upstream oil and gas industry is cyclically faced with low oil prices and high
operating costs, with the growing challenge of ageing assets and increasingly
complex infrastructure. Similarly, the downstream market is struggling to
maintain production uptime of ageing assets operating at maximum capacity
due to increased availability of low cost feedstock and high demand for
their products. Whilst safety remains paramount, improving asset reliability
is just as crucial to stay competitive and to realise cost efficiencies.
Offshore platforms pipelines, terminals In addition to the market challenges Whilst an IDC survey cited “Process
and downstream facilities, are costly of price volatility, shareholders are and operations optimisation and
to build, operate and maintain, so it’s pressing companies to maximise control”2 as being a driver for data
imperative that operators keep tight value. A strong focus on operational management and the use of analytics.
control over the total life-cycle cost of efficiency will remain a priority for the
all associated equipment. In order to foreseeable future whilst operators Are you in full control
maintain operation and production, maximise recovery. These challenges of your data?
mitigating against downtime is a key are compounded by having to do more
objective; in a survey of oil and gas with limited resources, skills shortages Are you in control of
professionals, 63%1 stated that the and an ageing workforce, which the
pressure to reduce asset downtime over Financial Times described as ‘Terrifying’ your asset’s risks and
the past 12 months has increased. Asset in relation to attrition and the impact integrity?
management software can undoubtedly on project delays and raising risks.
reduce costs and improve asset Are you in control of
reliability in line with a comprehensive Asset management software tackles
and effective asset performance daily operational challenges by your asset costs?
management (APM) strategy. optimising inspection and maintenance
regimes and driving efficiencies. The Are you in full control
Oil and Gas professionals ARC Advisory Group highlights the key of your Enterprise
reporting pressure to drivers for operators purchasing asset
reduce asset downtime management software as uptime, cost
Asset Management
over the past 12 months control, asset longevity, and safety. (EAM) system?

63%
1 Independently commissioned Populus poll of 80 senior decision-makers in the oil and gas industry in October 2015,
on behalf of Lloyd’s Register Energy
2 http://www.idc.com/prodserv/insights/energy

Working together
for a safer world
 Cost of failure Challenges faced in the
achievement of asset The benefits of embedding RBI,
The cost of failure can have huge
management goals1 RCM & RCA in your EAM system:
consequences on human life and the
environment. In terms of unplanned 9% Poor data • Real-time and full-time
asset awareness
shutdowns and the monetary loss,
Lack of visibility • Reduces risks and operating costs
failure costs operators billions of dollars
a year. It’s estimated that equipment
failures cost the U.S. refining industry
20% into asset
condition
• Minimises the risk of
equipment failure
• Increases asset reliability,
over $4 billion per year and since Lack of availability and utilisation
2009, well integrity failures have
cost operators over $75 billion3. 13% visibility into
performance
• Identifies cumulative risks
of ageing equipment
• Identifies critical equipment
In a recent article, GE emphasised the
• Focus limited resources
cost of failure, stating that failure can However, embedding third party
on your critical assets
result in daily revenue losses of millions solutions into their functionality
• Prioritises the inspection and
of dollars during an unplanned shut- can significantly complement and
maintenance based on risk
down period. The article also highlights improve functionality to provide
• Creates understanding of
that aside from loss of revenue from the optimal asset strategy; helping
predictable and non-predictable
unplanned shutdowns, the cost of overcome the challenges faced in
failure modes
time-based maintenance is substantial, achieving asset management goals
• Schedule and manage work
for example maintenance of a blowout such as poor data, lack of visibility into
orders more efficiently
preventer can cost between $10 million asset condition and performance.
• Complies with safety
and $16 million. However, predictive
standards and regulations
maintenance software provides operators Embedding knowledge building and
with timely predictions that can save decision making tools including Risk
millions of dollars in maintenance costs Based Inspection (RBI), Reliability Centred
by avoiding unscheduled resurfacing. Maintenance (RCM) and Root Cause RBI, RCA and RCM modules can be
Analysis (RCA) into an EAM application applied to a number of asset families:
Embed and realise efficiencies delivers numerous advantages over • Fixed Equipment and Pipe
Many asset intensive organisations traditional independent or interfaced • Relief Devices
use an Enterprise Asset Management approaches, at a low cost, with • Rotating (pumps)
(EAM) system, such as IBM Maximo or minimum impact to existing business • Instrumentation
SAP, to manage the performance of processes. This can enhance value by • Manufacturing (belts, furnace, etc)
physical assets across the entire asset leveraging existing EAM investments, • Pipelines
lifecycle on a common platform. functionality and processes – creating • Ships (hulls)
full visibility and traceability of data. • Structural
• Subsea Equipment

• Decrease leaks
• Improve uptime
• Understand impacts of risk

• Increase turnaround intervals

• Optimise shutdown scope
• Safely eliminate internal inspections

• Reduce unscheduled work

• Identify technical weaknesses
• Understand ageing infrastructure

• Minimise people on platform

• Avoid Loss of Containment
• Asset Life Extension

• Decrease inspection and

maintenance frequencies
• Avoid production downtime

3 http://www.upstreamintel.com/well-lifecycle/

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Knowledge is power
Improved decision making is a key factor
for many individuals involved in the day
to day running and strategic ownership
of equipment, assets, plants and facilities.
From the maintenance manager to the
CFO, knowledge off an asset affects
decisions regarding maintenance and
inspection regimes to investment plans.
To balance cost and risk in the most
responsible manner, the application of
industry-specific asset models, applied
within the EAM, can help reduce
operational costs and provide deep
insight into asset criticality and risks.
“Improving asset
availability benefits
the bottom line
immediately”
Take full control of your
asset’s performance
It’s vital that critical assets are identified
and resource allocated appropriately
since typically less than 10% of the
assets carry 95% of the risk.
Achieving the highest possible
performance of an asset against the
lowest possible costs, whilst ensuring
safe operation, is a challenge faced
by many operators. To attain this,
operators must understand what areas
to focus on and have access to reliable
and accurate performance data.
This helps to identify common causes
of failure, performance of bad actors
and the asset’s expected lifetime. It will
also lead to opportunities for improving
safety and revenue and lowering costs.
Optimising inspection strategies
using Risk Based Inspection (RBI)
Creating optimised inspection and
maintenance strategies for pressurised
and non-pressurised equipment can
be achieved through an RBI approach,
facilitating pro-active predictive
approaches rather than reactive decision
making. This can also generate time,
resource and cost savings primarily with
maintenance and inspection budgets.
RBI identifies the unknowns and
cumulative risks of ageing equipment
and is a cost-effective alternative to
traditional inspection and testing
methods. Software should assist by
ranking assets with a configurable and
powerful qualitative risk assessment
system to predict the risk for selected
assets through quantitative analysis
based on industry standards. It’s
also paramount the solution can
be sustainable over time; it’s not
4 Building a Business Case for Industrial Software Projects Helps Ensure Success, ARC Insights
uncommon to manage assets for 50+
years. By implementing a solution
that supports a closed loop process,
managed typically by existing inspection
and maintenance teams, the software
should capture the deterioration
mechanisms and historical information,
which can then be passed to new team
members with minimal training.
Prevention using Reliability
Centred Maintenance (RCM)
RCM is an option for designing
and optimising a preventive
maintenance strategy. The ideal
APM strategy prioritises assets based
on criticality, includes risk mitigation
strategies and when embedded in
an EAM system, will lead to a higher
return of investment of RCM.
Implementing a structured RCM
process to assess all risks that threaten
optimum safety and production, and
adjusting the maintenance strategy
accordingly, can be difficult. Traditional
methods and tools are often regarded as
too time-consuming, and the results are
often hard to implement in daily practice.
One of the main reasons RCM
implementations do not reach their
full potential is the lack of a structured
process throughout the organisation,
however, when this process is embedded
in an EAM system, the same data and
processes are used, ensuring output
quality and easy user adoption.
A challenge also presents itself when
gathering the right data. If the RCM
implementation turns out to be too
time consuming, the momentum
and enthusiasm can fade quickly. To
mitigate this problem, predefined data
templates are required that cover a
vast number of different asset types;
the right solution can lead to RCM
deployment time being cut by 50% to
80% compared to traditional methods.
Failure investigation and prevention
using Root Cause Analysis (RCA)
RCA is a tried and tested method
to identify the causes of failure
incidents. The right prevention or
mitigation measures can only be
taken when the root causes have been
established in a structured process.
Frequent failures and safety incidents
can have a high impact on operations,
quality and bottom line. Operators often
apply makeshift solutions, however
problems reoccur and have increasingly
negative effects on reliability,
operational costs, the environment,
and even your corporate image.
When the root causes have been
successfully determined in a structured
process, the right prevention
or mitigation measures can be
implemented. An effective RCA
solution enables high-impact incidents
to be thoroughly assessed with the
outcome permanently available to all
stakeholders, improving transparency
and traceability, which is key in
systematically reducing risks.
“Powerful analysis prevents
high impact failures”
Creating the business case
Building a good business case for
the justification of investment and
implementation of software and
technology is imperative as highlighted
by an ARC survey which noted
‘project justification’ as a key issue to
stakeholder buy-in and commitment.
ARC also emphasises that a good business
case connects the benefits of an EAM
system and associated software with
financial metrics as well as risk mitigation,
stating that “The primary objectives of
maintenance tie to the C-suite metrics in
the P&L statement and balance sheet.”4
Following investment, gaining full
buy-in from across the organisation is
key to the successful implementation of
new software solutions as is addressing
other barriers including articulation
of the benefits and training.
Barriers to the successful implementation
of new software solutions1
None of
these10% 9%andLevelbuy-in
of support
across
Other
4% your organisation
16% 8%
Too costly Ease of use
26% 16% Training and
Benefits of using the
software are unclear
familiarisation procedures
Unnecessary exposure to risk and
failure of equipment and machinery
that is critical can have a major impact
on production and revenue. It’s a fact
that effective data management and
analytics for asset and operations
optimisation can yield a high ROI while
simultaneously addressing HSE concerns.
Predicting and assessing impacts of
interventions using for example RCM, RBI
or RCA methodologies provides the right
insights to make well-informed decisions.
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Ask the experts
Axxim™ is brought to you by Lloyd’s
Register Energy, experts in integrity
engineering and asset management.
It offers the latest technology in asset
optimisation, providing upstream and
downstream oil and gas operators,
chemical, power and other asset-
intensive industries with a single resource
to identify critical assets, increase
equipment reliability and uptime by at
least 20%, reduce failure risk by up to
90%, and determine optimum approach
to inspection and maintenance that can
achieve costs savings of up to 50%.

Axxim™ is a unique solution that

directly embeds into your enterprise’s
asset management (EAM) application,
including IBM Maximo and SAP,
through MaxGrip’s strEAM+ technology,
which ensures easy adoption and
minimising of IT implementation time
and software maintenance effort. A About Lloyd’s Register Energy
standalone version is also available to Lloyd’s Register Energy applies
meet your specific business needs. its expert knowledge and
independence to help clients and
Axxim™ converts information from regulators design, construct and
your operations and assets into valuable operate their capital intensive
knowledge, by incorporating decision assets and businesses to their
making techniques including Risk Based highest levels of safety and
Inspection (RBI), Reliability Centred performance.
Maintenance (RCM), Root Cause Analysis
(RCA) and Failure mode and effects As part of the Lloyd’s Register
analysis (FMEA), within your EAM system. Group, we draw on a long
heritage of fresh, innovative
Our experts can help you migrate thinking in response to new
from traditional time-based technologies and challenges.
inspection and testing methods to The one consistent element is
a risk-based solution that enables our commitment to independence,
the optimisation of inspection and integrity and always doing the
maintenance strategies in a much right thing.
faster and more cost efficient way.

Request
a demo

Lloyd’s Register Energy provides Asset Integrity and Information Services to help
clients manage the integrity, performance and reliability of their assets from design
through to decommissioning.
For more information on how we can support your business please visit
www.lr.org/energy or contact us at assetintegrity@lr.org

www.lr.org/energy
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© Lloyd’s Register Group Limited 2015
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