Herve Baron

"The Oil & Gas Engineering Guide" ﴾Editions Technip, 2015﴿

The most common SINGLE CAUSE of

Project delays
Herve Baron + Follow
Author, The Oil & Gas Engineering Guide ﴾Editions Technip﴿
Published Oct 29, 2017

I keep being puzzled by ONE essential fact that is consistently ignored by Project
personnel:

The duration of a Project is directly linked to how soon you place the purchase
orders for the Equipment ﴾all Equipment, not just the Long Lead Items﴿

More precisely, and as illustrated above, Engineering development effectively starts

2 months after 50% of the Equipment purchase orders have been placed, i.e., when
vendor information starts coming in.

The reason is that Engineering development is not possible before information

about Equipment is available. The Plant is indeed designed around Equipment, to
service these Equipment. Needed information include: General Arrangement
drawing showing Equipment dimensions and required maintenance space, setting
plan with loads allowing design of support/foundation, power & utilities
consumption allowing design of corresponding supplies, piping, Electrical and
Instrumentation connections etc. Equipment vendors produce these documents only
some weeks after the purchase orders are placed. Hence:

1﴿ Equipment purchase orders must be placed early

2﴿ Interface documents must be properly identified and their submission from

vendors expedited. Fortunately there are only a few such documents: please refer to
chapter 16 of "The Oil & Gas Engineering Guide" ﴾link below﴿ for the list.

Application: On a 3 year EPC Project, 50% of Equipment Purchase orders must be

placed by month 8. If they are not placed until month 12 the Project completion
date will be delayed by 4 months. It is this simple!

Case study 1: On a particular 3 year EPC, no orders were placed before a year ﴾bids
did not fit into the budget﴿. The Contractor kept telling the Client that they will be
on‐time. The Client was unable to challenge this. They would if they had read "The
Oil & Gas Engineering Guide".

Case study 2: On a particular job, the EPC contractor had sub‐contracted

Engineering as a LS. A choice which was likely to delay the order of the Main
Equipment. Indeed, how was the EPC contractor sure that the most competitive ones
were selected by the Engineering sub‐contractor? Result: orders were placed 16
months late ﴾you read well: 16!﴿. Parties were surprised to see the Project
Completion date delayed by 16 months. They should not.

"The Oil & Gas Engineering Guide" ﴾Editions Technip, 2015﴿.

Presentation:

https://www.slideshare.net/hbaron/the‐oil‐gas‐engineering‐guide‐2nd‐edition

Link to the publisher's website:

The Oil & Gas Engineering Guide ‐ 2nd edition

Please quote BAR2017 for a 25% discount when ordering from the publisher website
﴾link below﴿.

459 · 53 Comments

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Simon C. 5y

For further information check this link : https://www.sikla.com

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Simon C. 5y

In terms of percentage of total project capex the welded secondary steelwork needed to
support all the piping and electrical services is a relatively small factor, however the
manufacturing and surface treatment lead‐times, plus often under‐estimated re‐working
delays and costs, are critical : using up‐to‐date and quality/performance certified modular
screw assembly support systems, now capable of load bearing into the multi‐ton area, and
which are adjustable on‐site avoiding costly dismount, or worse scrap‐and‐redo, can greatly
improve ROI and time‐to‐project‐completion, even more so if built into the 3D engineering
model and supply chain specifications up‐front in Feed and Detail design phases.

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Glen M. Jones, PhD, PMP 5y

I have to agree that the need for vendor data is often forgotten, or at best an afterthought. I
always include the delivery of vendor data in my schedules to make sure this requirement is
communicated to all stakeholders. Without this in the schedule, you are setting yourself up
for failure from the beginning.

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Giorgio Monti 5y

very true

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Tushar Zope 5y

Days are gone! Most customers start construction immediately after concept design is frozen.

Like Reply 2 Likes

Alan Kernaghan 5y

Stewart OBrien

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Miguel Angel Acevedo Ruíz 5y

JFA is right, example as shown certainly is a single cause itself ﴾a mistake﴿.

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Blas Azucenas 5y

FEED....

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 Bashir Mirza 5y

That is why smart clients conclude large equipment ordering prior to the LS EPC award. The
cost savings accrued from contractor "buy outs" are soon lost in the sea of delays in the
design and construction of steel and piping. Engineers love fine tuning, and project managers
must make engineering move forward when the plant can be run safely and is operable.

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