Operators face huge challenges in maximising production from offshore assets while still ensuring that people and the environment remain safe, particularly in the current economic climate. Yet this is a challenge that must be met. John Lilley, General Manager of Sonomatic, explores a new approach to asset integrity management.
Background to why we need Asset Integrity
Ultimately, the life of existing assets will have to be extended, safely and reliably, and balancing production against integrity requires a comprehensive understanding of those assets and the use of management strategies that engage employees at all levels. Many of the ageing North Sea assets are progressively deteriorating, with asset transfers commonplace. This often leads to a fusion of old and new systems, conflicting priorities, gaps in integrity management systems and sometimes poor management of change.
As a result, while the focus is firmly on asset integrity, in practice this does not necessarily reflect a true understanding of its scope. Operators and owners must be confident that their assets can produce safely with active risk management, and focus on the safety and business-critical elements of their operations.
This requires a balance between safety-critical issues and operational pressures and includes defining critical path and safety-critical areas of integrity, which must never be compromised. The specific core competencies of the individuals involved throughout the process are paramount.
To ensure that an asset integrity management system is operating at the optimum level, operators can now implement systems and practices provided by asset management peer groups. This may for example include PAS 55 from the Institute of Asset Management or the Asset Management Toolkit from the Health and Safety Executive. Sonomatic has had great success in implementing these methodologies using our own tools and shaping them to clients’ visions and goals.
Procurement of asset integrity management
A number of UK operators currently approach integrity/inspection contracts through a single-source, all-embracing contract for inspection and integrity management services. This may considerably simplify contract administration, but it does not deliver the best capability for each area of service. An alternative solution is for a collection of experts in their respective fields to combine their capabilities in the form of an alliance or joint venture. This ensures that the very best expertise is available from world-leading providers, each playing to their strengths. An example of this is the Expert Alliance (www.theexpertalliance.com) where a collection of key suppliers with complementary skills and a long track record of successful collaboration have joined forces to create a very strong and effective entity. The end result is a deliverable that ensures the best in terms of both competency and creativity in the interests of meeting not only technical but also cost and quality goals.
No single company can be at the leading edge of the full range of services. There are several reasons why this is the case:
Competence and ability to deliver at the highest level within the many areas covered by a single contract depends on specialist knowledge and experience. Dilution of capability is inevitable when a single company attempts to provide the full range of services required.
Different disciplines require different business models, management styles and cultures. This is clearly the case with respect to effective provision of integrity management services, advanced engineering consultancy, and both conventional and specialist inspection services. These four areas differ fundamentally from one another, and the management approach and culture appropriate for one area can be debilitating when imposed on another.
Given the limitations of the single contract approach, companies set up to offer the full range of services will generally focus on function and have a limited capability to innovate. A properly functioning alliance or JV can however provide the right environment for innovation and creativity to all projects, including changes to the overall approach. This has the potential to yield significant benefits on all levels. This ranges from, for example, in-house development of ‘smart’ inspection technologies and applications to Non-Intrusive Inspection (NII) planning, data management tools and statistical analysis of pipework systems, all of which enhance and streamline asset management processes. Critical factors for a successful alliance are to ensure that the most appropriate expertise is made available and that effective management systems are in place to ensure a conflict-free and efficient operation.
To achieve improvement in the area of safety and integrity performance there needs to be a higher level of perception and understanding of risk by all involved. An improved understanding of risk leads to better-informed decisions, but achieving this is not always straightforward. Predicting the likelihood of a major hazard and ultimately a major incident draws on a wide range of factors and influences. Understanding the balance and setting the right priorities is critical, and this requires high levels of risk awareness and a robust understanding of safety and integrity and the practicalities of executing the integrity and inspection requirements. Those involved should also be aware that focusing on worst-case scenarios can deflect attention from other more likely events which in turn may become major contributory factors in lack of mitigation and detection of major incidents. Indeed, they may even cause escalation of a single event.
The HSE provides direction in the UKCS through the KP3 program and also through the use of tools such as Hydrocarbon Release Reduction Toolkit which strives for continuous improvement and senior management engagement. However, ownership of risk management remains in the hands of owners and operators. This represents a major challenge at a time when assets are declining and becoming more expensive to maintain.
There can be clear and tangible benefits to having routine functionality and long-term strategic/visionary direction in the hands of separate companies working towards a common goal. The strategic/visionary element cannot exist without the routine functionality, so in the case of single-source contracting, as they cannot co-exist, the former is sacrificed. Within an alliance or JV, management systems must be in place to define the goals and ensure that objectives are met at all levels. This is a case of being best in class within each critical area, but also understanding why each activity is necessary. Such understanding requires ongoing assessment with questions being asked such as “are you doing it well enough, or should you even be doing it at all?”
We need to become technically innovative in a marketplace that aims to maintain and improve the quality and physical condition of ageing assets.
The hardest issue to address is short-term responsibility. Typically, an integrity service provider is in post for a few short years, and may well be measured on costs versus production. This short-term view of performance optimisation often results in funding for maintenance and inspection activity being withheld, which just delays and exacerbates the problems. Integrity service providers need a strong focus on client delivery and needs to consider long-term investment over their own short-term remuneration.
Recent experience of focusing on helping operators achieve their business goals and objectives has shown that some operators recognise the need for innovative approaches to deliver overall savings. These operators are increasingly taking a longer-term view and increases in expenditure in some areas are supported where the end result is a much larger benefit in terms of asset performance improvement.
Elsewhere, however, the risk-based or goal-setting regime is being implemented by single-source third-party service providers, often to the detriment of owners and operators, and often leading to a growing list of outstanding corrective actions, and upgrades of equipment and material. Long term, this is of no benefit to any owner or operator.
Future for Asset Integrity Management
Single-source inspection/integrity management contracting leads to the provision of defined capabilities and competencies in order to keep the wheels turning — at the lowest possible price. Within this framework, fundamental processes are seldom challenged, and a good deal of work is either misdirected, or unnecessary, and data gathered in the field is often not used to its fullest extent. It requires innovative thinking to break out of this loop, and innovation does not come easily to an organisation focused purely on functional delivery of day-to-day requirements.
The alliance concept ensures that specialist activities are used and managed in the most effective and constructive manner. The specialist inspection service provider, for instance, will want to ensure that the capabilities and limitations of his technology are fully taken into account in the inspection planning process, and likewise that the data collected is fully understood in terms of risk management. This requires good cross-disciplinary understanding. Different heads are required, each exploring improvements, making their own cases, and challenging established practice while ensuring ongoing delivery that maximises benefit to the operator. This concept provides the framework for optimisation through versatility, and the advantage of it is that the owner/operator is free to mix and match external support with internal resources as required.