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CONTENTS
FEATURES Prospects of Plastic and Petrochemical Sector in North East VOL. 15 | NO. 2 | FEBRUARY-MARCH 2018 | MUMBAI | US $10 | ` 150 OFFSHORE WORLD R.NO. MAH ENG/ 2003/13269 Chairman Publisher & Printer Chief Executive Officer
EDITORIAL
Editor Feature Writer Editorial Advisory Board Design Team Subscription Team Production Team
Maulik Jasubhai Shah Hemant K. Shetty Hemant K. Shetty Mittravinda Ranjan (mittra_ranjan@jasubhai.com) Mahesh Kallayil (mahesh_kallayil@jasubhai.com) D P Mishra, H K Krishnamurthy, N G Ashar, Prof M C Dwivedi Arun Parab, Shankar Joshi Dilip Parab V Raj Misquitta (Head), Arun Madye
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Subscription Rate (per year): Indian - ` 810/-; Foreign - US$ 120 Price of this copy: ` 150/The Publishers and the Editors do not necessarily individually or collectively identify themselves with all the views expressed in this journal. All rights reserved. Reproduction in whole or in part is strictly prohibited without written permission from the Publishers.
06
-Pranjal Kumar, Chief Manager (C&P)Contracts and Procurement, Brahmaputra Cracker and Polymer Limited Accuracy & Connectivity in Flare Gas Monitoring
14
-Lana Ginns, Marketing Manager, Fluenta Oil Movement and Storage Best Practices
20
-Rick Rys, Senior ConsultantARC Advisory Group, Boston IT-OT, Industrial IoT & Analytics: The Triple Force Towards Integrated Asset Performance Management for O&G
25
-Murali Chandrahasan, Head- Engineering IT Solutions, L&T Technology Services New-age Technologies Transform Oil & Gas Companies into Digital Enterprises
Amit Bhalerao (amit_bhalerao@jasubhai.com) Prashant Koshti (prashant_koshti@jasubhai.com)
Mumbai
Kolkata
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28
-Sahil Dhawan, Associate Vice President & Head Energy & Utilities Vertical (Asia, Middle East & Africa), KPIT Technologies
MARKET RESEARCH Downstream Oil
30
-Nilesh Ghuge
NEWS FEATURES Mapping Out the Next Frontier in Digital Transformation
36
-Ron Beck, Energy Industry Marketing Director, AspenTech -Sunil Patil, Business Consulting Director, AspenTech Teamwork Makes the Dream Work
38
-Tom O’Donnell, Director of Business Development, Neptune and PSG -Ravi Prasad, Director of Sales, PSG India In One of the Most Physical Industries, Digitalisation is the Key to Fast Compliant, High Quality Design of Oil &Gas Equipment
42
-Russell Brook, Marketing Director EMEA, Mainstream Engineering, Siemens PLM Software
NEWS
45
PRODUCTS
47
EVENTS DIARY
53
BOOK SHELF
54
Jasubhai Media Private Limited
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FEATURES
Prospects of Plastic and Petrochemical Sector in North East India- Gateway to ASEAN & BBIN Countries The idea of “Growing” and “Reforming” India has not just enticed the Indian businesses but also enthused foreign investors to make India as investment destination with expectations. Plastics and Petrochemicals plays a vital role in the growth of Indian economy and will continue at the expected growth rate of 8% till 2030. Plastic and Petrochemicals Sector has become the ubiquitous workhorse of the modern economy – manufacturing products with peerless functional properties and optimum cost. The uses of plastic products have increased twenty-fold in the last two decades and is expected to double again in the next five years. This sector offers a new vision and roadmap to overcome the boundaries of today’s incremental improvements and fragmented initiatives which will align with the principles of the circular economy, to unlock future growth opportunities with an unequivocally systemic and shared approach. The aim of this sector is to move the plastics value chain into a positive spiral of stronger economics, capture value and better environmental outcome- while creating a shared sense of direction and igniting the spark of innovation.
I
ndia faces massive demand for polymers and petrochemicals fueled by a robust economic growth. An ambitious dream was nur tured by the countr y’s flagship oil & gas companies in Nor th East India in setting up first of its kind petrochemical industr y by supplying feedstock for conver ting it into polymers. The petrochemical complex
has the competitive advantage of consistent supply of feedstocks viz., Naphtha and Natural gas. Built with the facilit y which integrates the world’s best technologies producing 280 KTPA of polymers, such a capacit y will alter the polymer market dynamics of Nor th East by easing the supply positions and providing the customers with qualit y
Figure 1: Statistics on global average for plastic demand www.oswindia.com
Offshore World | 6 | February-March 2018
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FEATURES produc t options. The worldwide consumption of per capita of plastic is approx. 27 kg. India’s per capita is 9 kg but Nor th East per capita is less than 4 kg per year. Packaging industr y in India has seen a strong penetration of plastics as compared to global standards. However, agriculture sec tor still hasn’t explored the benefits of plastics to a large ex tent. Global average for plastics demand in agriculture is ~8% while India is substantially lower at only 2%. (Figure 1)
Skilled Labour Force Ready Projec ts Comprehensive Government Suppor t The current consumption in NER is around 4300 MT per month (MTPM) with the following break-up: (Figure 2)
The Indian plastics processing industr y has grown at a CAGR of 10% in volume t e r m s f r o m 8 . 3 M MT PA i n F Y 1 0 t o 1 3 . 4 MMTPA in FY15 and is expec ted to grow at a CAGR of approx imately 10.5% from FY15 t o F Y 2 0 t o re a c h 2 2 M MT PA . Th o u g h t h e outlook for plastics processing in the Indian subcontinent is positive, still the industr y faces many challenges. Coupled with local availability of raw material, market potentials for down-stream industries a n d v a r i o u s g o v e r n m e n t i n i t i a t i v e s a r e Figure 2: Statistics on region wise demand pattern expec ted to give a fur ther boost in setting up of plastic processing units in the region. Various initiatives are Virgin Polymer (as processed in NER): 2300 MTPM under taken by various stake -holders viz., setting of production units, Reprocessed Polymer (as reprocessed in NER): 900 MTPM public utilities, logistics, residential areas and administrative ser vices External Supply (Processed products as are supplied to NER): 1100 MTPM to boost the development of plastic industries scenario in the region. The petrochemical complex with an investments more than USD 1.5 Billion K e e p i n g i n l i n e w i t h t h e G o v e r n m e n t o f I n d i a ’s v i s i o n o f will lead the growth in the future with ample supply of raw materials to more Hydrocarbon-2030, the primar y focus is on promoting and attrac ting than 200 plastic processing industries to set up and fulfill the envisaged plastic-based downstream industries which will not only bring in bright future in Plastics and Plastic products for the region. The lone mega large amount of investments but also generate huge employment Petrochemical Industry in the entire NE region has brought renaissance in oppor tunities and socio- economic development in the region. the polymer sector in the region with readily availability of raw materials thereby paving the way to set up , numerous downstream polymer industries North East scenario: North East of India is bound to take a big leap and will grow at a faster speed in will be set up in the region, and polymer consumption will also rise. the field of Plastic and Petrochemicals. Assam consumes a wide range of plastic/ polymer products and is the most industrialized state in the North Eastern region. Besides, the state holds the unique strategic position as the entry point to the rest of the states in the region as well as ASEAN and BBIN countries and hence have tremendous scope for polymer market including scope for exports. The region has the following basics of the growth i.e;
Market Raw Materials Resources including infrastruc ture
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As North East region enjoys the strategic locational advantage of being in close proximity to ASEAN countries, hence operation of lone petrochemical complex in providing polymers will help in getting the necessary fillip in feedstock sourcing and in the polymer processing sector along with increased growth in end-user industries propelling the growth of plastics in North-East India. Th e re g i o n h a s t h e s t r a t e g i c a d v a n t a g e s a s b o t h u p s t re a m a n d downstream is coming up in the region coupled with lower labour cost and investor-friendly approach by most of the state governments
Offshore World | 8 | February-March 2018
Offshore World is an all-encompassing magazine for the hydrocarbon and allied industries. A bi-monthly magazine, launched in December 2003, Offshore World disseminates authen c, cri cal and well-researched informa on on global hydrocarbon industry innova ons. The magazine offers latest and strategic informa on on the upstream and downstream hydrocarbon industry. The endeavour of Offshore World is to become a vehicle in making “Hydrocarbon Vision 2025” a reality in terms of technologies, markets and new direc ons, and to stand as a medium of reflec on of the achievements and aspira ons of Indian hydrocarbon industry. Circula on: 25,370
OSW Target Segments
OSW Reader’s Profile
5% Hydrocarbon Explora on 10% Hydrocarbon Processing 20% Drilling and Equipment Manufacturers 10% Development and Produc on Companies 13% Transporta on and Logis cs Companies 12% Refining and Marke ng Companies 15% Plant, Machinery and Equipment Providers 10% Technology Solu on and Service Providers 5% Safety , Health and Environment
12%
13%
• CEOs & Senior Management of Oil Companies • Petroleum Engineers & Refineries Contractors • Project Managers • Refining & Pipeline Engineers • Corrosion Control Engineers • Opera ons Managers • Technical Managers • Safety Managers & Engineers • Purchase Managers • Marke ng Execu ves • Pollu on Control Specialists • R&D Personnel • Industry Consultants • Engineering & EPC Consultants • Indian & Overseas Industry • Associa ons • Training Ins tutes
15% 10% 30%
10% 5%
20% 5% 10% Hydrocarbon Exploration Hydrocarbon Processing Drilling and Equipment Manufacturers Development and Production Companies Transportation and Logistics Companies
Refining and Marketing Companies Plant, Machinery and Equipment Providers Technology Solution and Service Providers Safety, Health and Environment
OSW Region-wise Presence 53% Western Region [including Mumbai,Gujarat, Pune, etc] 23% Northern Region [including Delhi, UP, etc] 10% Southern Region [including Bangalore, Hyderabad, Chennai, Coimbatore, etc] 9% Eastern Region [including Kolkata, Assam, etc] 5% Interna onal [includes USA, MiddleEast, Russia, Brazil, Iran, China, Germany, Italy, France, etc]
FEATURES
Figure 3: Growth drivers of Nor th Ea st region of India
of the region. The Gas Cracker has proven to be the potential game changers and in shifting the focus of plastic industr y to eastern states of India and become the hub for future growth. (Figure 3)
command around 2% in the domestic market. The complex enjoys 60% market share in Nor th East region and working relentlessly for fur ther improvement in the scenario.
Way forward The plastic industr y in the region, at present, is witnessing a dramatic transformation from a low-profile produc tion base accounted for by the local entrepreneurs, to a scenario in which the major-players in the field in the countr y are focusing on investment oppor tunities i n t h e re gi o n . Th e m a j o r p e t ro c h e m i ca l p l aye r s i n t h e re gi o n a re committed to establish significant presence in the nor th-east region in petrochemical sector by way of production or sourcing and marketing of qualit y produc ts, deploying efficient distribution and marketing channels to cater to the needs of target customers. Oppor tunit y of expor ting desired polymer (PE/PP) grades in the adjoining countries is also being explored for expanding market footprints of the Plastic Industr y in nex t few years.
In terms of new plastics era D emands and new way of thinking and emerging technologies, demand for per formance plastics such as biodegradable polymers is expec ted to be on rise across the world including India. Focus areas are going to be modern farming through Plasticulture, packaging for processed food & non- durables, better p l a s t i c s f o r Au to m o b i l e s, i n f ra s t ru c t u re d e ve l o p m e nt, i n n ovat i ve p ro d u c t s f o r Te l e co m m u n i cat i o n a n d I T s e c to r s. P l a s t i c u l t u re ca n significantly benefit agriculture by its wide applications in all the areas of farming. It can be used to tackle the specific problems faced by Nor th-East regions.
Coupled with local availability of raw material, campaigns like “StartupIndia” launched by the Government of India are expec ted to give a fur ther impetus in setting up of plastic-processing units in the region. As also India gears up to take the Make in India initiative for ward, lone petrochemical complex in Nor th East region India products will provide tremendous boost to the nation and give an impetus to the downstream industries. The transport cost component involved here will be relatively low (say ` 1800-` 2000 per ton), as compared to transport cost from the western region (say around ` 5500 per ton). Petrochemical complex in North East region has registered its presence in the market and presently www.oswindia.com
Conclusion Pe o p l e u n d e r s t a n d t h e i m p o r t a n c e o f P l a s t i c s a n d t h e ro l e o f Petrochemicals in the future and many future looking projects came up which were earlier not possible because of unavailability of raw materials or uncertainty of the availability of the raw materials. India will remain the leader in the economic growth for next decade and so will be North East region of India. Various government strategies with consistent and suppor tive policies like “Ac t East” has transformed Nor th-East Petrochemical and Plastic Industr y towards sustainable competitiveness thereby providing longterm investment with stable business. Keeping in line with the Centre’s vision of Hydrocarbon-2030, the state government has called upon
Offshore World | 10 | February-March 2018
Advertise in February - March 2018 issue of Offshore World! Next Issue Focus: EPC Special It is timely to examine EPC Contracts and their use in oil and gas projects given the bad publicity they have received, particularly in contracting circles. A number of Contractors have suffered heavy losses and, as a result, a number of Contractors now refuse to enter into EPC Contracts in certain jurisdictions. This problem has been exacerbated by a substantial tightening in the insurance market. Further, some project proponents believe that the project delivery methods such as EPCM contracts give them greater flexibility and that they have the expertise and experience required to control costs in an EPCM Contract. However, because of their flexibility, the value and the certainty Sponsors and Lenders derive from EPC Contracts, the authors believe EPC Contracts will continue to be a pre-eminent form of construction contract used on large-scale oil and gas projects in most jurisdictions. Forthcoming edition of Offshore World will focus on the use of EPC Contracts in the oil and gas sector.
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FEATURES entrepreneurs to invest in plastic industr y. The government has also passed the Ease of D oing Business Bill 2016, creating possibilities of a single window clearance system for fast tracking business projec ts in the state. The focus is on promoting and attrac ting plastic-based downstream industries which will not only bring in large amount of
opportunity is awaiting in NER as present per capita consumption of plastic is approx. 4 Kg per year as against the world-wide consumption of plastic approx. 27 Kg and India’s of 11 Kg. NER also enjoys the strategic locational advantage of being in close proximity to ASEAN countries.
investments but also generate huge employment oppor tunities and socio - economic development in the region. Significant effor ts are also being made by all the stakeholders to realize the real potential of this sec tor and positioned it as an evolutionar y economic player in the Nor th East region. As India gears up to take the Make in India initiative forward, BCPL made in India products will provide tremendous boost to the nation and give an impetus to the downstream industries. It is now all set to redefine the North East petrochemical landscape. Moreover gate way of vast investment
Pranjal Kumar Phuk an Chief Manager (C&P) Contrac ts and Procurement Brahmaputra Cracker and Polymer Limited Lepetkata Post Office Dibrugarh, Assam Email id: pranjal_xlri@yahoo.com
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About Magazine Offshore World is an all encompassing magazine for the hydrocarbon & allied industries. Offshore World disseminates authentic critical and well-researched information on global hydrocarbon industry innovations. For the industry professionals with the quest for enhancing knowledge, the magazine offers latest and strategic information on the upstream and downstream hydrocarbon industry. Offshore World endeavors to become a vehicle in making “Hydrocarbon Vision 2025” a reality in terms of technologies, markets and new directions and be a medium for reflecting the achievements and aspirations of Indian hydrocarbon industry. This highly reputed JS Group bi-monthly publication provides novel insights on the dynamics of Indian and global hydrocarbon industry.
Highlights of the magazine
• In-depth, cutting-edge articles on latest trends in technology in hydrocarbon related to focus topics mentioned in the editorial schedule. • News and reports on issues, trends and corporate events that shape the international oil and gas world. Besides, this is an ideal platform to leverage your presence through our major international exhibitions & events like “Chemtech” & “Oceantex”. • In-depth and lively features on research, automation, environment, etc. • Colourful profiles of top companies, close encounter with top-notch people in the industry, and new product launches. • Reviews of latest books on hydrocarbon industry around the world.
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FEATURES
Accuracy & Connectivity in Flare Gas Monitoring Accurate measurement is critical to safety and profitability in the Oil & Gas industry. Lana Ginns, Marketing Manager at Fluenta, discusses the importance of flare gas measurement and how operators can ensure monitoring is accurate, effective and meaningful.
T
he Deepwater Horizon oil spill of 2010 is estimated to have released 210 million gallons of oil into the environment around the Gulf of Mexico. The cost of the tragedy was measured in human lives, environmental damage, broken businesses and reputational disaster, aside from the billions in compensation. Oil exploration is dangerous. While reducing risk is the most critical element to the industry, central to understanding and managing risk is access to accurate information. In the Oil & Gas Industry, the difference between delivering success 99.9 per cent of the time and 99.999 per cent of the time could be a matter of life and death. Flare gas measurement The extraction of highly flammable liquids and gases from the earth involves precise technology combined with experience and expertise developed over decades and stringent safety regimes. Despite well publicised incidents that occasionally take place, the industry is safe and consistently getting safer. The publicity that comes with oil and gas explosions demonstrates how rare these incidents are.
Burning excess gas by flare is a critical part of any operator’s safety regime. Flare stacks are often used for burning flammable gas released by pressure relief valves during unplanned over-pressuring of plant equipment. This often takes place during start-ups and shutdowns in production when the volume of gas being extracted can be uncertain. Flare stacks provide a critical means to ensure safety – not allowing the gas to escape would cause a significant build-up of pressure and increase the risk of explosion. But gas is not only flared for safety reasons. When crude oil is extracted and produced from onshore or offshore oil wells, raw natural gas also comes to the surface. In areas of the world lacking pipelines and other gas transportation infrastructure, this gas is commonly flared. The question of emissions Flaring has long been recognised as a leading contributor to greenhouse gas (GHG) emissions, and consequently global warming. Associated gas from the oil extraction process produces more than 300 million tons of CO2 emissions
Figure1: Flare Engineer www.oswindia.com
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FEATURES a central consideration. This indicates the range of flow that a meter is able to measure with acceptable accuracy. If, for example, gas flow varies from 100,000m3 per day to 1,000,000m3 per day, a meter would require a turndown ratio of at least 10 to record accurately. There are four primary technologies around gas measurement: • Differential Pressure (Dp) Devices: DP devices were used in the earliest days of flow measurement and were often deployed for transmission and distribution of gas. These devices have a limited turndown ratio and often need a long, straight line of piping to be effective. That piping, and the space it requires, is expensive. • Thermal Mass Measurement: Thermal meters use two sensors to determine flow rate: one of the sensors is constantly heated and flow is measured by monitoring the cooling effects of gas on the temperature of the sensor – the faster the flow, the cooler the sensor will become. With turndown ratios of up to 600, these meters are suitable for the unpredictable nature of flare measurement but require constant correction when gas composition changes. As a consequence, thermal meters can be expensive to maintain and make it difficult to ensure continuous accuracy.
Figure 2: Christiano Serrano Checking FGM
annually. A 2015 report released by the Western Values Project (WVP), a non-profit organisation focused on sustainable land development, estimates that taxation lost from gas flaring in the US alone amounts to more than $50 million annually. While the Oil & Gas Industry has come a long way in its recognition and reduction of emissions, increasing regulatory focus and additional public and media attention means the industry must make more progress in the way it measures and manages GHG emissions. Flaring gas is subject to regulation in many parts of the world. Penalties, taxes and fines for flaring are common around the globe and flaring itself is an issue that is being addressed by the European Union, the United Nations and the World Bank.
• Photo/Optical Technology: This method of measurement uses particles in the gas stream to reflect laser beams. The volume and velocity of gas is proportionate to the time it takes particles to travel between the laser beams. With a turndown ratio of 1500, this method of measurement is flexible enough for flow monitoring but does not work with clean gas, where there are few or no particles. It is also susceptible to degradation caused by moisture and condensation meaning there are high maintenance costs. • Ultrasonic: The most reliable measurement tool for gas is ultrasonic. This method measures the time it takes for ultrasonic waves to travel across a pipe both upstream and downstream. The difference between these two values provides the most accurate measurement of flow. Ultrasonic measurement has the highest turndown ratio of up to 4000 and is not impacted by the composition or cleanliness of gas. With no mechanical parts within the line, maintenance and support requirements are low, safety is increased, and accuracy is maintained, even at low velocities and varying compositions.
How can operators ensure accuracy? Accurate measurement is required to demonstrate both good practice and ensure a company’s carbon tax obligations are minimised. By employing the most accurate measurement technology, operators can ensure they are not paying more tax than needed while also demonstrating regulator y compliance.
Measurement Automation The most forward thinking operators are now looking to the Internet of Things (IoT) – the global network of devices connected directly to the internet – to further improve measurement efficiency. Connecting flare gas meters to the internet means measurements can be monitored remotely and in real-time and data collected from on-site equipment can be streamed to any location around the world.
Tools used to measure flare gas need to be reliable in some of the most ex treme environments on ear th, where exposure to environmental conditions cannot impact accuracy. The turndown ratio of equipment is
Cloud technology – where software is stored on a central server and accessed via the internet – has transformed how businesses access, pay for and utilise enterprise software. Access to software in this way is now fundamentally
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FEATURES
Figure 3: Fluenta Inc (13)
changing the Oil & Gas Industr y ’s approach to asset management, empowering operators with increased visibility and analytics over plant data. It gives operators the ability to monitor equipment installed on a variety of local assets – from offshore oil rigs to chemical production plants – and transmit the data in real-time to be analysed in a completely separate location. Flaring data from a number of sites can be fed into a continuous emission monitoring system (CEMS) to enable an operator to collect, record, analyse and report data from multiple sites remotely and in real time. This significantly reduces cost and removes the need for an on-site engineer to manage the hardware and record data. Data is more secure – stored on a remote server – and is not dependent on the reliability of the on-site machine.
Global regulations and targets – such as those agreed at COP21 in Paris in 2015 – mean that emissions repor ting requirements will become increasingly stringent. Reporting will become a national priority and businesses will need to adapt, becoming more efficient in the face of increasing administration costs and carbon taxation. Accurate measurement technology and remote asset monitoring to track flaring volumes can give operators the information and insight they need to inform business strategy during this transition. (This article was originally published in October-November 2016 issue of Offshore world)
Increased control and visibility over emissions data can also be used to gain business advantage. New revenues can be established from existing processes. For example, data can be collated and compared from every site in an operation to optimise the flaring process and support continuous improvement. Best practice from low-emission sites can be implemented in high-emission sites to improve overall efficiency. Conclusion Over the next 10 years connected measurement technology will become central to limiting global temperature rises caused by GHG emissions. High-emission industries, such as those that routinely flare gas, will need to drive adoption of this technology, but they can also harness its speed, flexibility and collaboration capabilities to drive new insight and revenues. www.oswindia.com
Offshore World | 18 | February-March 2018
Lana Ginns Marketing Manager, Fluenta Fluenta Email: lana@fluenta.com
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FEATURES
Oil Movement and Storage Best Practices Correct management and operation of an oil and gas terminal is essential for a successful business. The processing, transporting and storing of crude oil or refined petroleum products in tank farms, involve custody transfers of partner and commingled stock, significant volumes of data from various sources and blending complexities.
T
ank farm automation for oil movement and storage in refiner y o f f s i te s s p a n s m u l t i p l e te c h n o l o g i e s. Th e s e i n c l u d e l e ve l, temperature, and flow measurements; DCS; PLC; preset controllers;
advanced control and optimization; safety systems, supply chain systems; and transactional business information systems. Since refinery offsites are often key for monetizing production, best practices are needed to enable these different technologies to work together as an integrated whole to support overall operational flexibility.
The storage tanks and extensive auxiliary equipment and instrumentation represent expensive assets. These provide surge volume for the transition of batch crude oil receipts and batch finished product shipments while the refinery operates continuously for years at a time. Receiving/distribution terminals are a separate oil movement tank farm that receives gasoline and distillates from refineries via pipelines, rail cars, barges, and/or marine carriers. Such terminals may blend ethanol or butane, into raw gasoline from the refinery and typically have truck
Figure 1:Truck Loading Terminal (Zeeco Products)
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Offshore World | 20 | February-March 2018
FEATURES loading operations to distribute the petroleum products to gas stations and fuel oil companies. Operational Flexibility is Key A key goal of tank farm automation in refinery off-sites is to support overall operational flexibilit y. This enables safe operation within operational constraints. The ability to accommodate a lowcost crude purchase or deliver a finished, onspec product when needed and with minimum quality giveaway provides financial benefits for both refinery operations and supply chain management. Operational flexibility allows the refinery to run with fewer changes to the refinery unit operations. Alternatively, it allows receipts and shipments to continue with minimal disruption when refinery unit operations are upset, such as an unexpected shutdown of a process unit like the FCC or the hydrocracker. The refinery runs continuously to process crude into rundown or blend component tanks. The rundown tanks in the tank farm provide surge capacity
Figure 2: Refinery Off-sites Tank
to meet batch blending and batch product shipments. Operational flexibility is improved if the refinery has many tanks with a large volume to maximize surge capacity. Given that refineries and terminals have a specific number and configuration of tanks, the problem to be solved is how to use those tanks most effectively. Operational flexibility provides oil traders with more options to buy the right crude oil at the right prices and to sell specific products to meet constantly changing customer requests. Oil Movements rre Complex Of course, tank farms must also be safe and environmentally compliant. It is important to plan feasible movements, line up the piping, and execute the movement without delay or risk of product contamination. With best practices, the topology of the piping system is precisely known and understood by the tank farm automation system. The status of the piping system, block valves, control valves, and all pumps must be known. Planning must consider any leaking valves or defective pumps, as well as other simultaneous material movements that could conflict with the lineup path of other movements. The management for piping paths books or reserves pumps, valves, and piping segments for the duration of a movement. Planning a series of product movements can result in many feasible solutions with many simultaneous movement paths. The particular pumps, flowmeters, valves, and pipe segments selected will place limits on the flowrates for feasible paths. This can be a critical decision that impacts the duration of a movement. A blending operation, for example, involves lining up multiple rundown tanks to a blend header that flows into a product storage tank. Selecting a small pump or a small flowmeter for the alkylate blending component might limit the blend rate and extend the time required to fill the product tank. This could impact future oil movements by tying up the needed equipment. Gasoline Blending Example Consider a complex material movement operation like blending gasoline. A particular batch of premium gasoline will have specific requirements for oc tane, RVP, sulfur, and perhaps a dozen other produc t qualit y
Offshore World | 21 | February-March 2018
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FEATURES
Figure 3: Level Measurement and Tank Gauging Systems
specifications. The blending problem requires selec ting component or rundown tanks and a product tank. The product tank is typically a floating roof-tank with significant residual heel volume. Suppose that heel volume was from a previous batch of regular gasoline. Based on the available components selec ted for a planned blend and the planned blend ratio or formulation, it might not be possible to meet the produc t qualit y requirements for premium gasoline before the product tank is filled.
Tank Gauging Systems Clearly, knowing the inventor y in a refiner y tank farm in real time is a fundamental requirement for effec tive automation. There are various technologies for level measurement and many will include “strapping tables” used to conver t tank level to stored volume using a look up table. Tanks expand and distor t when filled. Temperature compensation is of ten also needed to ensure accurate volumetric measurements. Available tank gauging options include: Radar/microwave
An additional consideration is whether all the selected component tanks
have sufficient volume to execute the blend. This is because the refinery
Hydrostatic, D/P head-based level
Capacitance
Ultrasonic
Buoyancy float (servo or tape)
Float Inductive
Nuclear
may be filling the component tanks while the blender is simultaneously drawing from the same component tanks. This is only one of the many complex situations that arise for oil movement and storage. As discussed below, many technology solutions are available for these types of problems. www.oswindia.com
Offshore World | 22 | February-March 2018
FEATURES
Figure 4: ď Ź
Dip tube with gas flow back pressure
ď Ź
Level switches (D/P, capacitance, float...)
ARC has developed a selection guide that can help users select the appropriate tank gauging systems for their varied applications. Tank Information Systems Tank information systems (TIS) combine tank level/volume information with product quality information that might be computed, measured with analyzers, or determined by periodic sampling with lab analysis. The TIS could include a graphical user interface and likely provides connectivity to other automation functions. The TIS provides a useful real-time database to support other tank farm applications. Movement Monitoring and Yield Tracking Applications Movement monitoring and material balance yield tracking applications can display all the active movements with alarms for issues and keep records for all movement histories. Mass balance checks can help ensure that reduced volumes in the source tanks match both flow metering and the volume gain at the destination tank. Flowrate metering can be adjusted using accepted practices to compensate to standard conditions. Movements can be tracked against customer orders.
Path Management/Movement Automation Path management typically employs procedural automation to facilitate movement line ups, start the flow, and stop the movement when completed (or if it must be interrupted). The application may involve booking specific equipment and requires a complete understanding of the entire tank farm piping network. Without instrumented pumps, valves, hoses, and other assets, path management cannot be fully automated, requiring operator confirmation that manual procedures are accomplished. For example, some hose connections may be required to start an oil movement, but the operator must first confirm that the proper hose connections are made. Blend Ratio Control Refinery tank farms routinely have gasoline and distillate blending systems. At a minimum, a refinery will execute a simple ratio control scheme in which selected components are combined into a blend header before being delivered to a product storage tank or sent to a pipeline. During this blend movement, the blend components are maintained in a volumetric ratio based on flow measurements. In a typical arrangement, the flows ramp up to a blend rate, continue at the blend rate until the blend approaches the end, then flows ramp down to a trickle before the blend stops. Various schemes can handle a situation in which one or more components cannot keep up
Offshore World | 23 | February-March 2018
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FEATURES the required flow, which would prevent the desired blend ratio from being achieved. For example, “pacing� control could be used to slow down the blend rate to maintain the desired blend ratio. Blend Optimization Simple blend ratio control does not respond to upsets in produc t qualit y or errors in estimating the component tank qualities used to compute the blending ratios. Various implementations use online analyzers at the blend header for feedback control to adjust the blend ratio during the blending process. This helps ensure the blended product meets all product quality specifications. Some configurations compute the values of some or all blend proper ties in the produc t tank as it is filling, based on analyzers connected to the blend header. With optimization, the blend can be optimized for the lowest cost of components, or an alternate goal like minimum deviation from star ting ratio. In either case, the analyzer-based control system attempts to fill a product tank that will meet product specs. An offspec product tank is problematic as it may require splitting the tank into two volumes with a patch (reblend) for each. At best, it ties up tankage and delays shippable product. The blend optimization problem typically ex tends into the refiner y operation to keep a proper inventor y of blend components and ensure the refiner y itself is operated at optimal targets within all operational constraints. Producing the most profitable blended products when needed has significant impact on supply chain management and refiner y profitability. Since blending can involve a collection of online analyzers, these analyzers must be managed to ensure they deliver reliable and accurate results. This
latter include refiner y planning, yield accounting, and environmental health & safety repor ting. Operators execute the movements that involve refinery tanks, pipelines, barges, trucks, rail cars, etc. Truck drivers execute the loading operations at truck terminals. Every facility will have specific physical equipment, instrumentation, control systems, planning and tank farm software and operating procedures. While the exact instrumentation, automation, operating procedures, plant operating software, and business applications will var y, training all stakeholders to work cooperatively with a clear understanding of roles and responsibilities is an essential best practice. Recommendations A top-quartile oil movement system requires many different functions to work together smoothly. Compared to typical refinery units, tank farm automation touches more business organizations and requires frequent coordination between the operations group, supply chain and trading group, and refinery scheduling and planning groups. ARC recommends that installing high-quality (ideally, intelligent) field instrumentation, especially tank gauging, is a good starting point. Since product quality of crude oil impacts refinery operation and finished product quality must meet shipment specifications; high-quality, well-calibrated online and laboratory analyzers are also essential. It is important to clearly identify roles and responsibilities that are consistent with the software integration of business and operational applications. As an example, the planning group may queue up a sequence of gasoline blends for the next 30 days. Operations may execute a planned blend, but might be forced to deviate from the recipe due to unforeseen refinery upsets. This, in turn, may require the blend planner to edit future blends in the queue. Clearly, it’s critical for all personnel to be working from accurate and timely data with a single version of the truth.
Source: Siemens
requires periodic calibration and validation of streaming real-time data. Overall Best Practices Best practices help ensure safe, environmentally compliant, and efficient operations. This implies maxmum operational flexibility, optimal use of surge capacity, movement planning capability, automation of movement l i n e u p s, a u to m at i o n o f m ove m e nt p ro ce d u re s, a cc u rate i nve nto r y accounting, and smooth integration with business applications. The www.oswindia.com
Offshore World | 24 | February-March 2018
Rick Rys Senior Consultant ARC Advisor y Group, B oston Email: SPrahladrao@ARCweb.com
In the modern era as markets become competitive, leading organizations place a lot of emphasis in reducing operating costs. Asset centric companies such as Oil & Gas companies are progressing and making great efforts to constantly monitor and correct the performance of underlying assets through newer technologies. By reducing asset downtime with the help of technology, a company can withstand huge losses which in turn can affect its market position. With the advent of Industrial IoT, the process of asset management can now become smarter & more effective. This article highlights the convergence of Information technology (IT) and Operational technology (OT) with new generation technology enablers such as Industrial IoT and Big Data Analytics that enables Integrated Asset Performance Management Solution for Oil & Gas industry. Oil & Gas Industry Challenges in Asset Performance Management: Integrated Asset Management with convergence of Industrial One of the biggest challenges facing the Oil& Gas Industry today is to reduce IoT and Asset Management applications asset downtime and improve the utilization of assets. These challenges Industrial Internet of Things (IIoT) combine sensors and information are fur ther intensified by the fact that such assets are distributed at technologies (Cloud, Mobile, Analytics) to enable assets to interact with multiple locations and require data to be monitored by multiple users at monitoring, analytics and control systems over Internet networks. According different levels. Consider this typical operations scenario: An Operations to a recent sur vey by ARC on Industrial Internet of Things (IIoT), top Head would be interested in knowing the Productivity Forecast, the Plant business drivers for adoption are reduced machine asset downtime, more Manager would require the data to be consolidated at Plant level, the rapid service response and improved process performance (figure 1.1). Site Engineer will look for operations data and finally the Maintenance Convergence of operational technology (OT) like SCADA or Data Historian Engineer would require preventive and corrective data. Operational Data with information technology applications like SAP-PM along with asset is available in multiple operational technology applications (OT) such as maintenance strategies lay the foundation for successful integrated asset SCADA& Data Historian and Maintenance and Productivity data is available in information technology (IT) applications which need to be accessed performance management solution for asset centric industry verticals. In in multiple systems by varied stake holders which makes it difficult to an era of challenging business times, optimum risk management by use of manage critical assets and make informed business decisions. Effectively technology can go a large extent towards cutting down uncertainties and the problem statement is to have a real-time intelligence platform that potential vulnerabilities. IIoT is fast emerging as the remedy for this as it IIoT Drivers plays the role of a technology enabler in convergence with IT-OT landscape can manage business excellence on all aspects.
Metrics Uptime
MTTR
Maintenance
Throughput
Efficiency Cost Control
Operations
ROA Revenue Revenue
Figure 1.1 November 14, 2016 | 1
Sales
ARC Survey with 200+ responses Q2 2014 Confidential | L&T Technology Services VISION, EXPERIENCE, ANSWERS FOR INDUSTRY
Offshore World | 25 | February-March 2018
Š ARC Advisory Group • 1
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FEATURES
IT-OT, Industrial IoT & Analytics: The Triple Force Towards Integrated Asset Performance Management for O&G
FEATURES Integrated Asset Performance Management (iAPM) Solution Architecture OSI PI Core Sight Portal
APM Dashboards
Information Technology (IT) Applications
CIS
iAPM Solution Components
Industry specific Asset model
ERP
EAM
Partner System Configurator
Business Activity Monitor
KPIs Externalization
Intelligent Asset Tag
Alarm/Event Monitor
Remote Asset Management
Asset Track & Trace
Asset Performance
Incident Management
Asset energy process Model
iAPM- Industry specific business process models Operational Technology (OT) Applications
Industrial IOT Devices
SCADA/Historian
FSM
Figure 1.2 November 17, 2016 | 1
Confidential | L&T Technology Services
to address the industrial pain point from asset management perspective. IIoT literally brings life to material machines. Along with IP enabled device gateways and platforms such as GE Predix and BIG DATA analytics, IIoT enables actionable insights into asset management for key stake holders based on historical data machine learning algorithms. Integrated Asset Per formance Management: The above diagram depicts a typical Integrated Asset Performance management (iAPM) solution framework. The key IIoT drivers along with relevance of each element on the metrics serves as a reference point for the key departments of Maintenance, Operations and Sales. It provides an integrated solution architecture where Industrial IOT devices are connected to conventional assets for real-time condition monitoring. (Fig 1.2) Integration of real-asset information from Industrial IoT platform with Enterprise Asset Management and portal applications provide asset-insights to key stake holders enabling and empowering them for informed business decisions.
The solution can be easily extended with enterprise data infrastructure tools such as OSI PI Asset Framework which provides an easy access to various asset types and their associated attributes which will be maintained in asset library. S m a r t A s s e t s e n a b l e d w i t h s e n s o r s c a p t u re v a r i o u s o p e r a t i o n a l parameters and are sent via IOT Gateway to the IOT Platform on Cloud. Some examples of modern digital platforms are L&T Technology Services’ homegrown UBIQWeise platform, General Electric’s Predix framework and PTC’s Thingworx. The frameworks enable integration of OT systems and applications such as control systems, SCADA/Historian and IoT Platform with Enterprise IT applications such as Enterprise Asset Management, Enterprise Resource Planning and portal applications such as CoreSight. OSI PI Asset Framework provides an enterprise data infrastructure which enables Asset Context mapping, and integrates to IT and OT applications with Industrial IoT platforms and Analytics tools for asset insights.
IIoT is fast emerging as the remedy for cutting down uncertainities and potential vulnerabilities, as it plays the role of a technology enabler in convergence with IT-OT landscape to address the industrial pain point from asset management perspective. www.oswindia.com
Offshore World | 26 | February-March 2018
FEATURES Business Benefits of Integrated Asset Performance Management
Figure 1.3
November 14, 2016 | 3
Strategic (increased asset utilization, improved performance and highest economic return on assets)
Financial (reduced both operational and maintenance costs)
Operational (reduce downtime, adherence to business process, improve quality, asset performance)
Reliability (reduced risk, early warning of impending equipment failures)
Engineering (decision support, less-time analyzing and more time acting)
IT (asset data quality, integration, real-time context & insights with Analytics)
Confidential | L&T Technology Services
iAPM framework leverages convergence of IT-OT applications and new generation IIoT platforms
Abbreviations used in the article EAM: Enterprise Asset Management
EAM products such as IBM Maximo, SAP PM Etc. – to automate the work order generation.
APM: Asset Performance Management
APM products such as Meridium for defining asset strategies, RCM and RBI functions
FSM: Field Service Management
Visual Analytics products such as QlikView, Tableau, OSI PI CoreSight etc – to provide near real-time Asset insights through visual dashboards. S t a t i s t i c a l A n a l y s i s t o o l s s u c h a s H a d o o p, S A P H A N A , R e t c – t o p ro v i d e P re d i c t i ve / P re ve n t i ve M a i n t e n a n c e insights. Geo Spatial Applications such as ESRI GIS and GE S m a l l Wo r l d f o r p r o v i d i n g g e o s p a t i a l a s s e t c o o r d i n a t e s .
H i g h l e ve l b u s i n e s s b e n e f i t s o f i m p l e m e nt i n g i A P M s o l u t i o n a re highlighted in Figure 1.3
IIOT: Industrial Internet of Things SAP-PM: SAP Plant Maintenance IT- Information Technology OT: Operational Technology SCADA: Supervisory Control and Data Acquisition GIS: Geospatial information System CIS: Customer Information System ERP: Enterprise Resource Planning (This article was originally published in October-November 2016 issue of Offshore world)
Business Benefits Informed decision-making had never been so precise and razor sharp till the technology-driven integrated asset performance management came into prominence. Also predictive analytics improves asset management and reliability of modern machine learning algorithms positively impact the Oil & Gas industry. Technology enablers such as IIOT thus add more value to convergence of IT-OT applications. Offshore World | 27 | February-March 2018
Murali Chandrahasan Head- Engineering IT Solutions L&T Technology Services Email: C.Murali@lnttechservices.com
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FEATURES
New-age Technologies Transform Oil & Gas Companies into Digital Enterprises The unpredictability of declining oil prices has slashed profit margins, intensifying pressure on Oil and Gas (O&G) industry to get a handle on their inefficiencies, rein the operating costs and reduce downtime. While all the three major aspects of the O&G sector worldwide – upstream, midstream and downstream – are faced with many challenges, it could certainly use a game changer to deal with the many challenges it faces – technology and digitisation. The industry is expected to leverage technology in order to optimise asset utilisation, improve operational efficiency, gain sustained performance and deliver better experiences. The article explains on technologies such as Big Data and Analytics, data management and platforms, Internet of Things (IoT), IT modernisation, virtual reality, robotics, machine-to-machine (M2M) learning and real-time solutions that will play an imperative role in guiding the future for the O&G companies in terms of digital refinery, connected fueling, remote pipeline monitoring, etc.
T
he Oil and Gas (O&G) industry is a globally integrated one. It is a key indicator of how economies around the world perform and define their monetary policies. Further it has a multiplier effect on the growth of secondary industries such as the production and sale of heavy machinery, motors, pumps, drills, transportation, automobiles, chemicals, etc. According to the International Energy Agency (IEA), the oil products demand in India is said to continue on an upward trajectory, rising two-and-a-half-fold to 10 million barrels per day (b/d) by 2040, which is the biggest rise projected for any country. Experts feel that the Smart Cities mission and the boost from the Make in India campaign for manufacturing will further drive this rise.
As the O&G sector comes face-to-face with reality, it could certainly use a game changer to deal with the many challenges it faces – technology and digitisation. The industry is expected to leverage technology in order to optimise asset utilisation, improve operational efficiency, gain sustained performance and deliver better experiences. Technologies such as Big Data and Analytics, data management and platforms, Internet of Things (IoT), IT modernisation, virtual reality, robotics, machine-to-machine (M2M) learning and real-time solutions will play an imperative role in guiding the future for the O&G companies in terms of digital refinery, connected fueling, remote pipeline monitoring, etc.
While demand for oil and gas is always on the high, the industry faces a few challenges nevertheless. Geopolitical events, globalisation, pricing, environmental change influence, demand and low availability of workforce are affecting the industry now, more than ever. The unpredictability of declining oil prices has slashed profit margins, intensifying pressure on companies to get a handle on their inefficiencies, rein the operating costs and reduce downtime.
While we can expect a lot of transformation in the industry, below are a few areas where we will especially see technology influence and digitisation taking place.
All the three major aspects of the O&G sector worldwide – upstream, midstream and downstream are also faced with many challenges. Upstream companies, involved with exploration and production (E&P), explore new hydrocarbon fields, develop them and produce petroleum are mainly affected by the increasing dollar valuation. They are on the constant lookout for better machinery and skillful workforce to operate the electrical equipment. The Midstream firms, which take care of transportation, shipping, pipeline management and liquefied natural gas (LNG) terminals, are whereas concerned with asset management and its effective usage. They run on the principle that ‘less the breakdown, better the productivity’. On the other end are the downstream companies which are concerned with the refinery processes of crude oil to produce different products such as petrochemical plants, polymers, plastics, etc. With focus on customer factors and trends which change on a continuous basis, the challenge arises in transportation and tracking of the trucks’ movements, theft of the product in the trucks, adulteration, etc. Availability of workforce on a contract basis is a matter of concern as well. www.oswindia.com
Streamline Inventory Management With the infusion of new technologies such as big data and analytics, companies seek to improve reliability, optimise operations and create new information and value. This helps in minimising the risks to health, safety and environment, improve cost and capital efficiency, explore new avenues for income and competitive advantage that transform the business. Through analytics we can predict the demand and accordingly produce and distribute the products to the relevant markets. Open communication protocols, sensors, advanced wireless mesh networks, augmented intelligence through integrated devices and asset-management analytics facilitate a shift towards condition-based predictive strategies. One will slowly see a change of mindsets from preventive planning to predictive planning. Companies have to invest in measuring this predictability of demand which is linked to the production. This will help in addressing a lot of challenges faced by the industry. For example, demand for digital oil-field applications will rise due to the plunge in oil prices. In such cases, one can avert the need for physical on-site inspections by creating opportunities to connect multiple platforms which can be operated remotely from a single onshore center. Having more automation in oil fields and using data analysis is considered the way forward. The constant stream of data produced by automated
Offshore World | 28 | February-March 2018
FEATURES equipment also known as measurement data, will be mined, collected as big data, and altered into smart data through intelligent analysis. This will help us in understanding production processes better. One can soon see the future where valves will be operated by machines than people. The flying of workers to offshore oil platforms in helicopters may someday become an exception rather than a practice. Making Pipelines More Secure According to a Deloitte 2015 study, the promise of IoT applications in the O&G sector isn’t just about managing existing assets, customer relationships and supply chains. It helps in creating an entirely new value or asset (i.e.) information. To obtain the full value of IoT, O&G companies must have an integrated deployment strategy. The industry can benefit from the use of operational technologies to locate and exploit complex resources. The data generated from devices can also be used in a structured way to make hydrocarbon extraction and the various other successive stages before sale, more efficient and profitable. According to Oxford Economics, industry-wide adoption of IoT will increase global GDP by 0.8 per cent (USD 816 billion) during the next decade. Fuel leaks and thefts have to be considerably brought down. The aging pipeline networks, manual monitoring and use of control devices present both challenges and opportunities for midstream companies who can visibly up their game in improving reliability and pipeline safety. Use of big data and analytics helps in creating data about potential breaches with the help of advanced sensors placed inside and outside the pipeline. Amplify Customer Experience The O&G sector is customer driven and the consistent increase in demand worldwide is what drives the sector. The way forward for the firms, is investing intelligently in making the business economically and efficiently viable. Fuel retailers are boosting sales at their gas stations through alternative forms of income, by tying up with food and beverage (F&B) firms, opening convenience stores, fashion outlets, ATMs, etc. These are some of the existent practices nowadays in Asian countries. Going forward, the retailers have to focus on providing a complete digital customer experience for people visiting petrol pumps by enrolling in connected-car prototypes. This involves collecting customer information and analysing this data to gather more useful information. The future of retail marketing at petrol pumps is all about: • Correlating consumer profiles with fuel and in-store purchases across a specific retailer’s owned stations and franchisees • Adding more appeal to the traditional loyalty and reward programs of offering discounts and redeemable points • Combining the existing data on petro-cards along with data generated from cloud-enabled emerging telematics solutions and connected Vehicles • Facilitating predictive analytics and behavioral marketing by collecting data from social-media networks
Reporting by Exception With the availability of workforce on the downside, getting technology and easy to use software would benefit, so that even non-engineers can understand and operate them. Enterprise Resource Planning (ERP) will help with skilling and reskilling the people available and identify where the gap is. It will be useful in determining workforce triggered procedure to fix problems. Data collected through various means of monitoring is automatically gleaned to generate an estimate within minutes, thereby assisting in putting together a corrective-action plan immediately. Digital Transformation at Workplace An average worker in this industry is seven times more likely to be injured. This necessitates bringing the issue of safety and compliance to the forefront. Reshaping of the workforce is also necessary. If the O&G sector looks at employing and retaining some of the best talent in the market, then the need to offer a work environment that fits a millennial’s mindset. Experts have to be brought into a more virtual world so that they can guide people using technology and thereby bridge distances and expertise. Having mobile applications for maintenance – with solutions like Smart Glass, Guided Maintenance solutions, Remote Monitoring and Maintenance Solutions, etc. also helps. Digital Enterprises of Tomorrow The digitally connected O&G enterprises of the future will also see adoption of three-dimensional (3D) imaging technologies, smart robots, sensors and Machine-to-machine (M2M) learning. These will help with the right tools which can accurately identify and measure cracks, dents and corrosion on the pipeline’s outer surface. It can also help with the art of drilling and predict the availability of oil in the rigs. While these technologies will make things simpler and create a better world, challenges will crop up in terms of implementation and localisation of this for large scale public sector oriented industry. The O&G industry’s digital maturity is among the lowest, at 4.68 on a scale of 1 to 10 (1 - least mature; 10 - most mature), according to the MIT Sloan Management Review and 2015 Deloitte global study of digital business. Organisations need maturity to embark on this digitisation journey with the mindset to retract and modify their traditional policies and procedures. They need to give and get digital approvals and also imbibe a digital culture. This is where technology providers with strong domain expertise can step in, to help achieve digital transformation. They have to help with building a digital roadmap, assessing where to start from, identifying problem areas and solving them. They have to provide end-to-end digital adoption and device-level exposure to strengthen internal security and overall simplification of processes. In shor t, O&G industr y has to rise to the occasion, reposition itself. The industr y might not disappear, but it will be ver y different, a decade from now.
According to industry estimates, around 33 per cent of IoT-derived benefits for an integrated marketer can be achieved from connected marketing, if they are able to conceive a workable and secure system. Offshore World | 29 | February-March 2018
Sahil Dhawan Associate Vice President & Head Energy & Utilities Vertical (Asia, Middle East & Africa) KPIT Technologies Email id: Sahil.Dhawan@kpit.com www.oswindia.com
MARKET RESEARCH
Downstream Oil
C
oncerns on weak marketing and refining margins, rising crude prices, and lower budgetary allocation for petroleum subsidy have hit Oil Marketing Companies (OMCs). Stocks have fallen 10-21% over the trailing six months. However, implied gross marketing margins on Diesel and Petrol have pulled back substantially. Singapore GRM have also recovered, and we are confident on government NOT imposing subsidy burden on OMCs when they are rolling out capex. Hence, OMCs provide an attractive buying opportunity.
where production is declining owing to political and economical turmoil. With OMC stocks trading at 4.5-5.5x core EV/EBITDA, we believe the above concerns are priced in. Maintain BUY on IOCL and BPCL with SOTP based target price of ` 503/share and ` 585/share. Upgrade HPCL to BUY from Neutral with SOTP based target price of `458/share, driven mostly by the correction. DOWNSTREAM OIL : SECTOR UPDATE
Marketing margins on auto fuels are higher than Over the last three months, OMCs have gradually increased gross marketing normalised level Marketing margins ongross auto fuels margins are higher than levelprice hike in October and November resulted in fall in margins on Diesel and Petrol. Currently, marketing on Diesel and normalised Lack of adequate Petrol arehigher than normalised level of `in2.3/l and ` and 2.5/l November respectively. marketing margins by 8-15% in 3Q for OMCs. esel prices Lack oftheir adequate price hike October Marketing margins improved in January and Marketing margins improved in January and February. resulted in fall in marketing margins by 8-15% in 3Q February. .6% and 6.5% in Benchmark Singapore GRM have bounced back from the low of USD5.8/bbl in for OMCs. ovember… January and are now stabilising at USD7/bbl. Gasoil, Jet Kero, and Gasoline reduced by showing strength owing to strong demand from Asia. We expect er and increasedspreads are Change In Benchmark Diesel Prices vs Change In Change In Benchmark Petrol Prices vs Change In vember benchmark Singapore GRMs to remain healthy owing to strong global demand Retail Diesel Prices* Retail Petrol Prices* for petroleum products% in CY18 (incremental demand of 1.4mbpd). % Ch in benchmark Petrol price % Ch in Retail price Ch in benchmark Diesel price % Ch in Retail price % % trol prices 10.0 10.0 7.4 .5% and 7.4% inInsufficient allocation for petroleum subsidies8.3in 7.8 8.0 the Union Budget could 8.0 6.5 ovember… 6.0 be perceived 6.0 as a potential subsidy risk for the upstream and downstream 4.54.6 reduced by 4.0 companies. We4.0expect that budgeted amount will be revised during the year 2.3 er and increased(in the last 11 years, government 1.7 1.3 1.5upwards 2.0 has revised petroleum subsidy 1.1 0.7 0.5 2.0 1.0 0.2 0.6 1.0 vember in 8 years) and- there won’t be any subsidy burden either on upstream or downstream (2.0) companies. Nevertheless, in a bear case scenario of OMCs sharing (2.0) (0.7) (2.1) (2.5) (2.4) a 5% subsidy(4.0) burden vis-à-vis 0-3% share of subsidy burden during FY12(4.0) (3.1) 9MFY18, the(6.0) impact on FY19E earnings is limited to -3% to -9%. (6.0) esel prices Marketing margins on auto fuels are (5.9) higher than normalised level (7.2) (8.0) (8.0) % and 8.3% in Nov-17 Dec-17 Jan-18 Mar-18 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Strong adherence toOct-17 supply cut (113% compliance with Feb-18 supply cut) in 3Q by Benchmark Diesel prices Lack of adequate price hike in October and November Marketing January while resulted in fall in marketing margins by 8-15% in 3Q February. increased by 0.6% and 6.5% in OPEC and their Non-OPEC members compared to 80% in 2Q resulted in 19% Source: Company, HDFC sec Inst Research;*Retail prices at Delhi February… for OMCs. October and November… up 1.7% and QoQ increase in crude prices. Currently, OPEC is producing 0.16mbpd lower than …retail by the agreed production of 29.92mbpd. So we doprices not seereduced further production cut ber and 2.4%production in October and increased from this level by OPEC. Increase in crude from Non-OPEC members Change In Benchmark Diesel Prices vs Change In Change In B down 3.1 in 1.1% in November will balance the further reduction inby crude production if any, from Venezuela, Retail Diesel Prices* Retail Petrol %
% Ch in benchmark Diesel price
% Ch in Retail price
Benchmark Petrol prices 10.0 8.3 Benchmark Diesel prices increased by 0.6% 6.5% October increased byand 0.5% andin7.4% in 7.8 8.0 6.5 and2.4% November… and November retail pricesOctober reduced by in October and 6.0 …retailBenchmark prices reduced increased by 1.1% in November Petrolbyprices 4.0 in October and increased 1.7 1.5 increased by 0.5% and 7.4%2.5% in October and November retail 1.1 2.0 1.0 0.6 1.0 by 0.2%and in November prices reduced by 2.5% in October increased by 0.2% in November Benchmark Diesel prices increased by 1% and (2.0) 8.3% in December and January while down 7.2% in February (2.4) (4.0) (3.1) retail prices up 1.7% and 7.8% in December and January while (6.0) Benchmark prices down 3.1 in February Benchmark Petrol Diesel prices were up 4.5% (7.2) (8.0) increased by 1% and Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18Page | 3 in January and down 5.9% in February retail prices8.3% wereinup December and January while 4.6% in January and down 2.1% in February Source: Company, HDFC sec Inst Research;*Retail prices at Delhi down 7.2% in February… …retail prices up 1.7% and 7.8% in December and www.oswindia.com Offshore World | 30 | February-March 2018 January while down 3.1 in February
trol prices were uary and down ary… were up 4.6% in own 2.1% in
% 10.0
% Ch
8.0 6.0 4.0 2.0
0.5
(2.0) (4.0)
(2.5)
(6.0) (8.0) Oct-17
MARKET RESEARCH Currently, gross marketing margins on Diesel are ` 1/l higher than normalised margin while gross marketing Petrol are DOWNSTREAM OIL : margins SECTOR on UPDATE ` 0.3/l higher than normalised margin
Diesel marketing margin
Petrol marketing margin
marketing margin Diesel Diesel marketing margins restored to and higher than
Petrol marketing margin Petrol marketing margins restored to and higher than Petrol marketing margins restored to and higher than their normalised their normalised level of Rs 2.5/l. Currently, gross marketing margins Petrol are Rs 2.8/lon compare level of ` 2.5/l. Currently,ongross marketing margins Petrol are to ` 2.8/l Rs 0.75/l in December. compare to ` 0.75/l in December.
Diesel normalised marketing margins and higher than their gross normalised their levelrestored of Rsto 2.3/l. Currently, marketing margins on Diesel are Rs 3.3/l compare level of ` 2.3/l. Currently, gross marketing margins on Diesel areto ` 3.3/l Rs 0.77/l in December. compare to ` 0.77/l in December.
Gross Marketing Margin On Diesel*
Gross Marketing Margin On Petrol* Rs/lit
3.3
3.5 3.0
2.5
2.5 2.3
Feb-18
Feb-18
Jan-18
Jan-18
Dec-17
Dec-17
Oct-17
Mar-18
Feb-18
Feb-18
Jan-18
Jan-18
Dec-17
-
Dec-17
-
Nov-17
0.5
Nov-17
1.0
0.5
Oct-17
1.5
1.0
Oct-17
1.5
Oct-17
2.5
2.0
Nov-17
2.0
2.8
Mar-18
3.0
Nov-17
Rs/lit 3.5
Oct-17
eting Rs 1/l d arketing Rs 0.3/l d
Oct-17
Source: Company, HDFC sec Inst Research;*Retail prices at Delhi
DOWNSTREAM : SECTOR UPDATE DOWNSTREAM OIL : OIL SECTOR UPDATE
Gasoline spread bounced back from low of USD 12.7/bbl in Januar y to USD 14.6/bbl in March
Benchmark Singapore stabilising at USD Benchmark Singapore GRMGRM stabilising at USD 7/bbl7/bbl
Gasoline Spreads ced back Gasoline Spreads US$/bbl ack US$/bbl bbl in 19.0
Gasoil spread up 4% QoQ to USD 13.5/bbl
Gasoil spread up 4% QoQ to USD 13.5/bbl Gasoil to15.2/bbl USD 13.5/bbl Jet Kero spread spread upup 11%4% QoQQoQ to USD Jet Kero spread up 11% QoQ to USD 15.2/bbl Jet Kero spread up 11% QoQ to USD 15.2/bbl
Gasoil Spreads Gasoil Spreads
Offshore World | 31 | February-March 2018
Jet Kero Spreads Jet Kero Spreads USD/bbl USD/bbl 17.0
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Mar-18
Page | 4
Mar-18 Jan-18
US$/bbl US$/bbl 17.0 17.0 15.0 15.0 13.0 13.0 11.0 11.0 9.0 9.0 7.0 7.0 5.0 5.0
Nov-17 Sep-17 Jan-18 Nov-17
May-16 Mar-16 Jul-16 May-16 Sep-16 Jul-16 Nov-16 Sep-16 Jan-17 Nov-16 Mar-17 Jan-17 May-17 Mar-17 Jul-17 May-17 Sep-17 Jul-17 Nov-17 Sep-17 Jan-18 Nov-17 Mar-18 Jan-18
Mar-16
US$/bbl US$/bbl 12.0 12.0 10.0 10.0 8.0 8.0 6.0 6.0 4.0 4.0 2.0 2.0 -
Mar-18
Singapore GRM Trend Singapore GRM Trend
May-16 Mar-16 Jul-16 May-16 Sep-16 Jul-16 Nov-16 Sep-16 Jan-17 Nov-16 Mar-17 Jan-17 May-17 Mar-17 Jul-17 May-17 Sep-17 Jul-17
Benchmark Singapore GRM stabilising at USD 7/bbl
Benchmark Benchmark Singapore GRM stabilising around USD Benchmark Singapore GRM stabilising around Singapore GRM stabilising around USD 7/bbl USD 7/bbl 7/bbl Refining margin supported by strong Gasoil and Jet Kero spreads. Refining margin supported by strong Gasoil and Jet Refining margin supported by strong Gasoil and Jet Kero spreads. Kero spreads.
Mar-16
16mbpd production rther cut in term
Sep-17 Jul-17
Nov-17 Sep-17
Jan-18 Nov-17 Mar-18 Jan-18
Mar-18
Sep-17 Jul-17
Nov-17 Sep-17
Jan-18 Nov-17 Mar-18 Jan-18
Mar-18
Jet Kero Spreads Jet Kero Spreads USD/bbl USD/bbl
US$/bblUS$/bbl 19.0
19.0
17.0
17.0
15.0
15.0
13.0
13.0
13.0 13.0
11.0
11.0
9.0
9.0
11.0 11.0
7.0
7.0
5.0
5.0
17.0 17.0
7.0
7.0
May-16 Mar-16 Jul-16 May-16 Sep-16 Jul-16 Nov-16 Sep-16 Jan-17 Nov-16 Mar-17 Jan-17 May-17 Mar-17 Jul-17 May-17
9.0
Mar-16
9.0 Mar-18
May-16 Mar-16 Jul-16 May-16 Sep-16 Jul-16 Nov-16 Sep-16 Jan-17 Nov-16 Mar-17 Jan-17 May-17 Mar-17 Jul-17 May-17 Sep-17 Jul-17 Nov-17 Sep-17 Jan-18 Nov-17 Mar-18 Jan-18
15.0 15.0
Naphtha prices rose owing to demand from Petrochemical industr y DOWNSTREAM OIL : SECTOR UPDATE OPEC produc tion 0.16mbpd lower than target produc tion so we do not see fur ther cut in produc tion in near term Page |Page 5 |5
FO Spread
Naphtha Spread US$/bbl 7.0
Mar-18
Jan-18
Nov-17
Sep-17
Jul-17
May-17
5.0 3.0 1.0 (1.0) (3.0)
Mar-18
Jan-18
Nov-17
Sep-17
Jul-17
May-17
Mar-17
Jan-17
Nov-16
Sep-16
Jul-16
May-16
(5.0)
Mar-16
Mar-17
Jan-17
Nov-16
Sep-16
Jul-16
(2.0) (4.0) (6.0) (8.0) (10.0) (12.0) (14.0) (16.0)
May-16
US$/bbl
Mar-16
e owing to ochemical
May-16 Mar-16 Jul-16 May-16 Sep-16 Jul-16 Nov-16 Sep-16 Jan-17 Nov-16 Mar-17 Jan-17 May-17 Mar-17 Jul-17 May-17
Mar-18
Gasoline Spreads Gasoline Spreads
5.0
Mar-16
5.0
May-16 Mar-16 Jul-16 May-16 Sep-16 Jul-16 Nov-16 Sep-16 Jan-17 Nov-16 Mar-17 Jan-17 May-17 Mar-17 Jul-17 May-17 Sep-17 Jul-17 Nov-17 Sep-17 Jan-18 Nov-17 Mar-18 Jan-18
Mar-16
-
MARKET RESEARCH
Mar-16
ack ed back bbl in bl in
-
Source: Bloomberg, HDFC sec Inst Research
Crude Oil Production From OPEC Countries
Countries* Algeria Angola Ecuador Equatorial Guinea Gabon Iran# Iraq Kuwait Qatar Saudi Arabia UAE Venezuela Total Compliance to production cut (%)
Target production after cut (mbpd) (A) 1.04 1.67 0.52 0.13 0.19 3.8 4.35 2.71 0.62 10.05 2.87 1.97 29.92
Actual production in 2QFY18 (mbpd) 1.06 1.67 0.54 0.12 0.20 3.82 4.50 2.70 0.60 10.00 2.93 2.00 30.15 80.67
Actual production in 3QFY18 (mbpd) (B) 1.02 1.63 0.53 0.13 0.21 3.83 4.45 2.70 0.61 9.99 2.90 1.76 29.76 113.73
(B)-(A) (mbpd) (0.02) (0.04) 0.01 0.02 0.03 0.10 (0.01) (0.01) (0.06) 0.03 (0.21) (0.16)
Source: IEA, HDFC sec Inst Research;*Libya and Nigeria are exempt from cuts; # Iran was given a increase of 0.09mbpd
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Offshore World | 32 | February-March 2018 Page | 6
and under stimated e crude oil d under USD mated crude oil SD d amount there y burden amount or ere nies burden
es
ised upwards in ed wards in
MARKET RESEARCH Petroleum subsidy and under recover y for FY19 estima ted a t ` 470bn with the c rude oil price assumption of USD 65/bbl We believe budgeted amount will be revised and there won’t be any subsidy burden either on upstream or downstream companies. In the last 11 years, government has revised petroleum subsidy upwards in 8 years
Petroleum subsidy will be revised upwards
DOWNSTREAM OIL : SECTOR UPDATE
As per our estimates total petroleum subsidy and under recovery in FY19 would be ` 469.7 bn (based on crude oil price assumption of USD65/
Petroleum subsidy willbudget be revised upwards bbl). However, in the union Finance Minister made a provision for petroleum subsidy DOWNSTREAM and under recoveryOIL of `: SECTOR 248.4 bn, UPDATE a shortfall of
As per our estimates total petroleum subsidy and Insufficient allocation of petroleum subsidies could ` 221.3 bn. under recovery in FY19 would be Rs469.7 bn (based be perceived as a potential subsidy risk for the Petroleum subsidy will be revised upwards on crude oil price assumption of downstream the last In11the Insufficient allocation of petroleum subsidies couldUSD65/bbl). be perceived as a potential upstream subsidy riskand for the upstream andcompanies. downstream In companies. However, the uniontotal budget Finance Minister years, government revised petroleum As per our inestimates petroleum subsidy made and Insufficient allocationhas of petroleum subsidiessubsidy could last 11 years, government has revised petroleum subsidy upwards in 8 years. We believe budgeted amount will be revised during the year and under recovery FY19 would be Rs469.7 bnrecovery (based be perceived as a We potential for the a provision for in petroleum subsidy and under upwards in 8 years. believe subsidy budgetedrisk amount will on crude price assumption USD65/bbl). upstream and downstream the last 11 of Rs248.4 bn, shortfall of Rs221.3 bn. be up revised during theof year and there In won’t be any there won’t beoil any asubsidy burden either onof upstream or downstream companies to crude oil price USD companies. 65/bbl. However, in the union budget Finance Minister made years, government has revised petroleum subsidy subsidy burden either on upstream or downstream a provision for petroleum subsidy and under recovery upwards in 8up years. We believe amount will companies to crude oil pricebudgeted of USD 65/bbl. of Rs248.4 bn, a shortfall of Rs221.3 bn. be revised during the year and there won’t be any Petroleum Subsidy: Provisions And Estimates subsidy burden either upstream or downstream FY19 on Provisions Particulars (Rs mn) companies upAs to Per crude oil price of USD 65/bbl. FY19E Union Budget
Petroleum Subsidy: Provisions Estimates Kerosene Under Recovery (U/R byAnd OMCs)
42,000 42,000 FY19 Provisions Direct Benefit Transfer of Kerosene (DBTK) subsidy 960 960 Particulars (Rs mn) FY19E As Per Union Budget *Fiscal subsidy on Kerosene 2,540 2,540 Kerosene Under Recovery (U/R by OMCs) 42,000 42,000 Total Kerosene subsidy and U/R 45,500 45,500 Direct Benefit Transfer of Kerosene (DBTK) subsidy 960 960 Direct Benefit Transfer of LPG (DBTL) subsidy 164,778 367,854 *Fiscal subsidy on Kerosene 2,540 2,540 Fiscal Subsidy (Assume)^ 6,080 24,330 Total Kerosene subsidy and U/R 45,500 45,500 PMUY LNG subsidy 32,000 32,000 Direct Transfer LPG (DBTL) subsidy 164,778 367,854 TotalBenefit LPG Subsidy andofU/R 202,858 424,184 Fiscal Subsidy (Assume)^ 6,080 24,330 Total Petroleum Subsidy and U/R 248,358 469,684 PMUY LNG subsidy 32,000 32,000 Shortfall in subsidy allocation 221,326 Total LPG Subsidy and U/R 202,858 424,184 Source: Union Budgets, HDFC sec Inst Research *Fiscal Subsidy includes subsidy under ‘PDS Kerosene and Domestic LPG Subsidy Scheme, Total Petroleum Subsidy and U/R 248,358 469,684 2002’, ‘Freight Subsidy (For Far-Flung Areas) Scheme, 2002’ on payment basis; ^Base on FY17 subsidy amount Shortfall in subsidy allocation 221,326
Budgeted And Revised Petroleum Subsidy
Source: Union Budgets, HDFC sec Inst Research *Fiscal Subsidy includes subsidy under ‘PDS Kerosene and Domestic LPG Subsidy Scheme, (B)-(A) (Rs bn) Budgeted 2002’, ‘Freight Subsidy (For Far-Flung Areas) Scheme, 2002’ on payment basis;(A) ^Base on FY17 subsidyRevised amount(B)
FY08 Budgeted And Revised Petroleum Subsidy (RsFY09 bn) FY10 FY08 FY11 FY09 FY12 FY10 FY13 FY11 FY14 FY12 FY15 FY13 FY16 FY14 FY17 FY15 FY18 FY16 Source: Union Budgets, HDFC sec Inst Research FY17 FY18
28.58 Budgeted29.26 (A) 134.57 28.58 31.62 29.26 236.96 134.57 437.37 31.62 650.55 236.96 634.86 437.37 300.67 650.55 290.16 634.86 249.70 300.67 290.16 249.70
141.54 788.58 Revised (B) 253.01 141.54 384.38 788.58 685.33 253.01 969.01 384.38 855.14 685.33 602.89 969.01 301.14 855.14 276.11 602.89 244.33 301.14 276.11 244.33
112.96 759.32 (B)-(A) 118.44 112.96 352.76 759.32 448.37 118.44 531.64 352.76 204.59 448.37 -31.97 531.64 0.47 204.59 -14.05 -31.97 -5.37 0.47 -14.05 -5.37
Source: Union Budgets, HDFC sec Inst Research
Offshore World | 33 | February-March 2018
Page | 7 www.oswindia.com Page | 7
ario of subsidy on FY19E to -3% to -
SD G
MARKET RESEARCH DOWNSTREAM OIL : SECTOR UPDATE
In a bear case scenario of OMCs sharing a 5% subsidy burden, the impac t on FY19E earnings is limited to -3% to -9%
Worst case subsidy burden impact will be -3% to -9% on OMCs Worst subsidy burden will be -3% to -9% on OMCs case Nevertheless, in aimpact bear case scenario of OMCs sharing
a 5% subsidy share of subsidy Never theless, in a burden bear casevis-à-vis scenario0-3% of OMCs sharing a burden during FY12-9MFY18, the impact on FY19E 5%earnings subsidy burden vis-à-visto0-3% subsidy burden is limited -3%share to of-9%. HPCL will be impacted the most while IOCL will be the least during FY12-9MFY18, the impac t on FY19E earnings is impacted. limited to -3% to -9%. HPCL will be impacted the most
Share Of OMCs In Under Recovery OMCs
Upstream
120.0 100.0
0.1
0.0
FY16
FY17
80.0 60.0
while IOCL will be the least impacted.
Oil Bonds/Cash
%
0.0
0.6 1.4
40.0
2.9
20.0 FY12
FY13
FY14
FY15
Source: MOPNG, HDFC sec Inst Research
At c rude oil price of USD 65/bbl per c ylinder LPG subsidy will be ` 239
DOWNSTREAM OIL : SECTOR UPDATE
Price Build Up Of Domestic LPG (Subsidised) At USD 65/bbl Of Crude Oil Price Particulars FOB Price at Arab Gulf of LPG at crude price of USD 65/bbl Ocean Freight from AG to Jamnagar Cost & Freight Price Cost & Freight Price Import Charges (Insurance/Ocean Loss/ LC Charge/Port Dues) Import Parity Price Refinery Transfer Price (RTP) Add: Storage / Distribution Cost & Return on Investment Bottling Charges Charges for Cylinder Cost Inland Freight Bottling Plant Cost Add: Cost of Working Capital Cost Price at LPG Bottling Plant Add: Delivery Charges Uncompensated Costs Market Determined Price Add: GST(including GST on Distributor Commission) @5% Distributor Commission Retail Selling Price Retail Selling Price (Rounded) Cost to Consumer Subsidy paid through DBTL by Government Source: PPAC, HDFC sec Inst Research
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Offshore World | 34 | February-March 2018
Unit USD/mt USD/mt USD/mt Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder Rs/cylinder
553.8 19.2 573.0 528.9 4.9 533.7 533.7 9.8 20.6 18.1 30.6 612.8 2.7Page | 8 615.5 10.0 24.9 650.4 35.0 49.2 734.6 735.0 495.6 239.4
MARKET RESEARCH
DOWNSTREAM OIL : SECTOR UPDATE
Valuation Charts
PER
(x)
P/E (x)
Peak(x)
14 (x)
Avg(x)
4.6
2.1
8.36.76.5
6.7 1.5 6.2 4.6
4.5
0.9 3.6
Source: 4 Capitaline, HDFC P/B (x)sec Inst Research; Peak(x) * EPS adjusted Avg(x) for PBV^ income, ^Book Value adjusted for investments at CMP dividend less 30% (x) holding company P/B (x) discountPeak(x) Avg(x)
justed for ents at CMP
2.2 2.0 1.5 0.9
2
5.04 4
1 2 0 3.0 0 0
Sep-14
Sep-14
Mar-14 Mar-14
Sep-13 Sep-13
Mar-15 Mar-15 Sep-15 Sep-15 Mar-16 Mar-16 Sep-16 Sep-16 Mar-17 Mar-17 Sep-17 Sep-17 Mar-18 Mar-18 Avg(x)
Peak(x)
Avg(x)
IOCL is currently trading 4.5x 1year forward EV/EBITDA (30% discount to peak multiple) while on PER it is trading at 6.2x 1-year forward (25% discount to peak multiple)
11.3 3.1 7.7 6.7 6.5 6.7 2.2 5.1 2.0 4.3 4.5 3.6
dividend income, P/B ^ Book 4 (x) Value adjusted Peak(x) for investments Avg(x) at CMP less 30% holding company discount
BPCL is currently trading 5.1x 1-year 3.1 forward EV/EBITDA (34% discount to IOCL is currently 4.5x 1- it is trading2.2 peak multiple)trading while on PER Page | 10 year forward EV/EBITDA (30% at 6.7x 1-year forward (41% discount to2.0 discount to peak multiple) while peak multiple) on PER it is trading at 6.2x 1-year forward (25% discount to peak multiple)
3
2
1
Mar-18
Sep-17
Mar-17
Sep-16
Mar-16
Sep-15
Mar-15
Source: Capitaline, HDFC sec Inst Research; * EPS adjusted for dividend income, ^ Book Value adjusted for investments at CMP less 30% holding company discount
Offshore World | 35 | February-March 2018
Page | 10
Sep-14
Mar-13
Source: Capitaline, HDFC sec Inst Research; * EPS adjusted for dividend income, ^ Book Value adjusted for investments at CMP Source: Capitaline, HDFC sec Inst Research; * EPS adjusted for less 30% holding company discount dividend income, ^Book Value adjusted for investments at CMP less 30% holding company discount
0
EV/EBITDA 12 10
B f p a p
8 6 4 2 0
PBV Source: Capitaline, HDFC sec Inst Research; * EPS adjusted for
0
Sep-16 Sep-16 Mar-17 Mar-17 Sep-17 Sep-17 Mar-18 Mar-18
Mar-16 Mar-16
Sep-15Sep-15
Mar-15Mar-15
Sep-14Sep-14
Mar-14Mar-14
Sep-13Sep-13
Mar-18
0.9
Mar-13Mar-13
1.5
IOCL is currently trading 4.5x 1year forward EV/EBITDA (30% discount to peak multiple) while on PER it is trading at 6.2x 1-year forward (25% discount to peak multiple)
3.1 2.1
6
2
Avg(x) Avg(x)
Peak(x)
EV/EBITDA (x)
Mar-14
PBV
7
1.0
Mar-18
Mar-13 Mar-13 Mar-13 Mar-13 Sep-13 Sep-13 Sep-13 Sep-13 Mar-14 Mar-14 Mar-14 Mar-14 Sep-14 Sep-14 Sep-14 Sep-14 Mar-15 Mar-15 Mar-15 Mar-15 Sep-15 Sep-15 Sep-15 Sep-15 Mar-16 Mar-16 Mar-16 Mar-16 Sep-16 Sep-16 Sep-16 Sep-16 Mar-17 Mar-17 Mar-17 Mar-17 Sep-17 Sep-17 Sep-17 Sep-17 Mar-18 Mar-18 Mar-18
Mar-18
Sep-17
0.4 0.2 0 1.0 0.0
7.0
P/B (x)
Peak(x) Peak(x)
6
3.6
DOWNSTREAM OIL : SECTOR UPDATE DOWNSTREAM OIL : SECTOR UPDATE
P/E (x) EV/EBITDA (x)
8
4
Sep-14 Mar-15 Mar-15Mar-15 Mar-15 Sep-15 Sep-15Sep-15 Sep-15 Mar-16 Mar-16Mar-16 Sep-16 Mar-16 Sep-16Sep-16 Mar-17 Sep-16 Mar-17Mar-17 Sep-17 Mar-17 Sep-17Sep-17 Mar-18 Sep-17 Mar-18Mar-18 Mar-18
Avg(x) Avg(x) 11.3
14 12 4 EV/EBITDA 10 (x) 11 3 8
2
3 2.2 2.0 1.8 2 1.6 1.4 1.2 1 1.0 0.8 0.6 0 0.4 0.2 0.0
Mar-13 Mar-13
Mar-18
Avg(x)
Sep-13
EV/EBITDA (x) Peak(x) P/B (x)P/E (x) Peak(x) Peak(x)
Sep-17
Mar-17
Peak(x)
PER EV/EBITDA (x) PBV
10
4.5
Mar-13 Mar-13Mar-13 Mar-13 Sep-13 Sep-13Sep-13 Sep-13 Mar-14 Mar-14Mar-14 Mar-14 Sep-14 Sep-14Sep-14
(x) (x) (x) 10 2.211 7.0 2.0 1.8 8 7 1.6 5.0 1.4 6 1.2 4 1.0 4 0.8 3.0 0.6 0
Sep-16
Valuation Charts PER (x) P/E (x) IOCL EV/EBITDA 14 PBV^ PER*
Mar-16
Sep-15
Mar-15
Sep-14
Mar-14
Sep-13
Mar-13
BPCL
6.5 6.7 6.7
3.0 0
BPCL 1.0
0
2.1
Avg(x)
4
DOWNSTREAM OIL : SECTOR UPDATE
2
vg(x)
Peak(x)
12
7 5.0
6.2
4
4.6
EV/EBITDA (x)
Avg(x)
11 7.0
8.3
6
6.2
Peak(x)
11.3
8
8.3
P/E (x)
EV/EBITDA
Mar-13
(x)
PER* 10
EV/EBITDA
Mar-13
IOCL
vg(x)
Sep-17
BPCL
-Nilesh Ghuge nilesh.ghuge@hdfcsec.com Page | 10 www.oswindia.com Page | 11
B f p a p
NEWS FEATURES
Mapping Out the Next Frontier in Digital Transformation Today, digital is a key enabler in refining and petrochemicals to reduce costs, make faster and better decisions, and to increase workforce produc tivity. Technologies like the Internet of Things, dynamic enterprise management, global supply chain visibility, and machine learning are already changing the way manufac turers produce goods and interac t with customers.
A
t the 22 nd Annual Refining and Petrochemical Technology
Optimizing energy and water use are impor tant goals, suppor ted by
Meet (RPTM), Dharmendra Pradham, India’s Minister for
research findings and operating initiatives of many par ticipants. As
Petroleum and Natural Gas, called for the countr y to double
energy cost savings can easily reduce CAPEX by 10 – 30%, sustainable
its refining capacit y to 500 million metric tons per year by 2040.
refining is a financially lucrative goal. Water conversation is also a
India’s strong growth projec tion is driven by bullish economic growth
critical element, as clean drinking water is a growing priority and
forecasts in the countr y. This will boost transpor t and petrochemical
scarce commodity in India.
demand, as well as expor t oppor tunit y. India requires key industr y enablers, such as the newly integrated and efficient refineries;
The next frontier
innovative work processes; cutting- edge soft ware technology and
With a wide spectrum of industr y perspectives, it is critical to
more technical workers.
have a clear roadmap working towards the nex t frontier in digital transformation. This roadmap needs to be aligned to the company’s
Integrating refineries and chemical plants
business objectives, be measurable in terms of outcomes and
A key industr y trend is the need to integrate refineries and chemical
demonstrate the return on investment (ROI) ver y clearly. A good
plants. For example, SABIC and Saudi Aramco have jointly announced
roadmap also considers previous effor ts in transforming digitally in
a mega integrated refining and chemicals complex in Saudi Arabia,
the past four decades. The existing sources of digital data, models
ADNOC, also the world’s largest integrated complex. This trend is also
and architectures should be used as building blocks for digital
prevalent across Asia with countries, such as Vietnam and Malaysia in
transformation. Its implications for employees and organizations
the running. In fact, Petronas’ RAPID project is a leading one in the
alike, need to be well thought through. In fact, the Indian refining
industr y. This integration drive is pushing across the Middle East as
industr y needs to have strong leadership and talented technical staff.
well. However, in India, this trend is both a threat and a necessity, as
With favorable economic tailwinds driving effor ts by the industr y to
world-class refineries aim to be optimally profitable and well ahead
invest in assets and human talent, these refiners are likely to emerge
of market competition. This massive integration effor t requires an
as leaders in the industr y, if not already.
industr y mindset shift by viewing refiner y processes and production goals differently.
For refiners, the future is uncer tain amidst hard driving market forces, such as fluc tuating demand and supply for oil and gas; increasing
Industr y trends
demand for petrochemicals; marine low sulfur fuel requirements and
According to Dr. Par tha Maitra from Reliance Industries, four major
business challenges, which require increasingly flexible operations.
trends driving India’s refining industr y includes bottomless refining;
This is where digital transformation creates a market oppor tunit y.
integrating refineries and chemical plants; sustainable refining; as well
With digital transformation, organizations become flatter and more
as the digital transformation of refineries. Sustainable refining focuses
agile, which makes them more competitive in unpredic table times
on energy efficiency, emissions reduction and water conser vation.
with business models adjusting to changing operating conditions.
www.oswindia.com
Offshore World | 36 | February-March 2018
NEWS FEATURES Rapidly changing workforce demographics also mean that new
application of digital innovation. For example, a major nor th slope
entrants to the industr y will bring with them a greater level of sav v y
operator increased revenues by more than USD 1M in one week, by
in using new technology.
embedding digital applications to rigorous models online, which runs concurrently on real-time data, providing updated and clear
The process industr y is not new to digital transformation, which has
operator advice ever y few minutes. In addition, a Gulf of Mexico LNG
been an ongoing trend for the past four decades. However, the best
firm employed machine learning based prescriptive maintenance to
per forming companies are those who apply digital transformation
obtain early warning of compressor operating risks. As a result, the
to their business initiatives in a pragmatic manner. The emergence
organization reduced compressor downtime and maintenance expenses
of new digital technologies, such as machine learning, advanced
wor th several millions of dollars per year in increased uptime.
robotics and distributed high-per formance computing, accelerates the momentum for digitalization initiatives. While there are many
The future
oppor tunities for process companies, there are also major roadblocks
Digital transformation is poised to accelerate, as technology evolves
to overcome. AspenTech sur veyed global refiners and discovered only
and new advancements are introduced. Smar t companies will take
38% of several hundred respondents anticipate achieving a significant
advantage of digital transformation oppor tunities and remain well
business return from digital transformation in less than two years. As
ahead of market competition. Organizations also need to create a
such, success will require sharp focus.
pragmatic roadmap to move for ward strategically. In fact, tomorrow’s market leaders will be companies, which can take advantage of digital
The master plan to transform digitally
transformation initiatives today.
To b e t h o ro u g h l y s u c c e s s f u l i n t r a n s f o r m i n g d i g i t a l l y, e xe c u t i ve s n e e d a c o m p l e te g a m e p l a n . Th e re a re f i ve c r u c i a l s te p s to d o i n g s o. Fi r s t, i t i s n e c e s s a r y t o m a x i m i ze v a l u e f ro m c u r re n t te c h n o l o g y. A n y n e w i n i t i a t i ve s n e e d t o i n t e g r a te a n d b u i l d u p o n e x i s t i n g d i g i t a l i n f r a s t r u c t u re. S e c o n d, i t i s n e c e s s a r y to u n d e r s t a n d t h e l e ve l o f m a t u r i t y i n a n o rg a n i z a t i o n . D i g i t a l t r a n s f o r m a t i o n i s s t ro n g l y t i e d t o o rg a n i z a t i o n c h a n g e, a s i t e n a b l e s c o l l a b o r a t i o n b e t we e n o p e r a t i n g t e a m s. Th i rd, i t i s n e c e s s a r y to d e f i n e ke y b u s i n e s s d r i ve r s a n d c h a l l e n g e s i n a n o rg a n i z a t i o n . A l l t e c h n o l o g y i n ve s t m e n t s a n d d i g i t a l t r a n s f o r m a t i o n i n i t i a t i ve s s h o u l d b e u n d e r t a ke n w i t h a c l e a r v i e w to e x p e c te d b u s i n e s s b e n e f i t s, p a y b a c k a n d re t u r n . Fo u r t h , i t i s n e c e s s a r y to i d e n t i f y ke y s u c c e s s m e t r i c s f o r i n i t i a t i ve s to a c h i e ve d i g i t a l t r a n s f o r m a t i o n . Ke y m e a s u re s o f re f i n i n g e xc e l l e n c e i n c l u d e f e e d a n d p ro d u c t f l e x i b i l i t y ; re l i a b i l i t y a n d u p t i m e ; e n e rg y u s e o p t i m i z a t i o n a n d t h e o ve r a l l c o s t l e a d e r s h i p.
Ron Beck
Fi f t h , c o m p a n i e s s h o u l d e n c o u r a g e wo r k f o rc e s k i l l s d e ve l o p m e n t.
Energy Industr y Marketing Direc tor
To o p t i m i ze e f f o r t s t o t r a n s f o r m d i g i t a l l y, a r a n g e o f te c h n i c a l
AspenTech
e x p e r i e n c e, o p e r a t i o n a l e x p e r i e n c e a n d c o m p e t e n c y a re re q u i re d. M a n y c o m p a n i e s c h o o s e t o o u t s o u rc e t e c h n i c a l t e a m s b u t t h e re is a danger of draining technical exper tise at the hear t of the Sunil Patil
e n te r p r i s e’s c o re a s s e t s.
Business Consulting Direc tor Leading downstream companies have been making progress, in terms of achieving significant benefits by being laser focused on the Offshore World | 37 | February-March 2018
AspenTech
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NEWS FEATURES
Teamwork Makes the Dream Work When a Latin American oil company optimized the injection of corrosion inhibitors into its pipelines, 500 Series Hydraulic Diaphragm Metering Pumps from Neptune were a unanimous choice for the job.
A
s it reached 75 years of operation, a Latin American oil company had grown to become the world’s fifth-largest oil producer and the region’s second-largest enterprise by annual revenue, behind only Petrobas.
Though the oil company’s rate of daily production has been declining steadily over the past decade, from an all-time high of 3.48 million barrels per day (b/d) in 2004 to 2.52 million b/d in 2013, that rate of production still equates to nearly 920 million barrels per year of oil, which is still a lot of product that needs to be moved to various end points, including refineries, storage terminals and retail sites. To facilitate this crude oil transport and transfer, this Latin American oil company operates a network of pipelines that covers nearly 8,000 miles. Setting Off a Chain Reaction A pipeline system this vast and complex needs to be kept operational at all costs, less downtime adversely affects the company’s ability to
meet production and delivery schedules. A common reason for pipeline breakdowns and malfunctions is corrosion that can be caused by the oil being transported or environmental factors. To combat these situations, corrosion inhibitors are periodically injected into the pipeline to protect it from the attacks of corrosive elements. “We had the oppor tunity to work with the people who were working on the design of the injection of chemicals in the pipeline system for the company,” said Oscar Ruiz, a longtime consultant with many contacts in the Latin American oil and gas industr y. “The company was looking for pumps that could satisfy its needs for reliable injec tion rates, while possessing the capabilit y to be operated remotely in harsh weather conditions.” Being intimately familiar with the company’s needs, Ruiz turned to his network of contacts, in the process setting off a nearly two-year chain
Figure 1: A major Latin American oil company has a pipeline network that covers more than 8,000 square miles of Mexican countryside. In order to help keep the pipeline operating effectively, even in the most severe weather conditions, the company is using 500 Series Hydraulic Diaphragm Metering Pumps from Neptune Chemical Pump Co to inject corrosion inhibitors. www.oswindia.com
Offshore World | 38 | February-March 2018
FEATURES selling chemicals to one of the watertreatment plants in Mexico. It makes it far better that we trust each other.” Once the chemical source was identified, Ruiz needed to find the right chemicali n j e c t i o n p u m p f o r t h e a p p l i c at i o n . Working off of Janes’ recommendation, he contacted FLIP, Inc, of Baton Rouge, LA, USA, which was a sales representative firm from 1975 to early 2015.
Figure 2 : Neptune fabricated 43 complete corrosion-inhibitor injection systems for the oil company that consist of a pair of 515 model diaphragm metering pumps and a stainless-steel 250-gallon tank in which the corrosion inhibitor is stored. All are able to be operated remotely, which is a benefit in harsh operating conditions, while also reducing the need to manually set dosing levels, as well as the number of on-site man-hours required to service the system.
reaction that would eventually result in one of the most significant pump orders in the history of Neptune Chemical Pump Co, North Wales, PA, USA. Since 2008, Neptune has been a leading product brand of PSG, Oakbrook Terrace, IL, USA, a Dover company. Ruiz’s first call, in early 2012, was to his friend Jim Janes, for whom he works as a consultant. Janes is the President of Janes Industrial Products, LLC, Scott, LA, USA, a manufacturer and supplier of specialty cleaning compounds for the industrial, aviation and remediation industries. “I’ve known Jim since 1995 and in 2005 he developed a solvent for this type of application,” said Ruiz. “We have also worked together in the past
“Oscar contacted our office and asked us to look at some injection systems for the oil company,” explained Ernie Spreen III, a former Outside Sales for FLIP, Inc, and now co- owner of KEEN Solutions LLC with Jimmie Kenaley, a new Neptune representative. “The company was looking to replace the pneumatic pumps it was using because with the heat and how they configured them, they weren’t lasting long at all. There was not enough air available to use the pneumatic diaphragm pumps, it was too dir ty to mess with and they needed someone to make sure the filters were clean. At first, they were looking for little solenoid p u m p s w i t h f i b e rg l a s s b a c k i n g w i t h no storage tanks, then star ted looking at pump skids, but eventually realized they would need something that could stand up to the harsh climate where the equipment would be located.”
The Right Pump for the Process That eventually led to the decision to use strictly stainless-steel equipment in the field, and Spreen’s endorsement of Neptune 500 Series Hydraulic Diaphragm Metering Pumps – specifically the 515 Model with stainlesssteel components, electronic stroke control, explosion-proof operation and installation on SS-316 skids – for the job. In all, the oil company would require 43 complete skid systems and a total of 86 pumps. “Neptune pumps are the best for all applications for injection,” said Spreen. “They are a simplistic pump that is highly repeatable and highly reliable. They can handle high pressures, and more than half the oil company’s
Offshore World | 39 | February-March 2018
www.oswindia.com
FEATURES
Figure 3: In some areas, the oil company plans to protect Neptune’s pipeline corrosion-injection systems with enclosures designed to keep out the elements and eliminate instances of tampering.
applications would be 1,000 psi, so we could configure the systems identically so they could go anywhere in the country and function in any condition. No pump would really work in this application except for what we were offering.” Ruiz was quick to second the recommendation.
things,” added Spreen. “Once they got the pumps on-site and put their hands on them they understood why the Neptune 500 Series was the pump that was selec ted for them.” With all of the pieces put in place, the nex t step was to get the pumps
“I have used Neptune pumps in a couple of projects, including one in Costa Rica where we had some injection packages made in one shop,” he said. “We used eight Neptune injection systems in one plant and it was a good experience. The company was very pleased because they were very accurate in their dosing. We have also specified Neptune pumps in water-treatment plants that were pumping 20,000 gallons per day of produced water and they worked well there, too.” One final hurdle to getting the Neptune pumps approved for the project had to come from the engineering firm that was partnering with the oil company on the project. In another fortuitous turn, Neptune had supplied pumps to the engineering company for past projects, so it was a name that the engineering firm was familiar with. “They were happy to work with us and the team at the oil company was accepting of everything that was involved with the equipment,” said Ruiz. www.oswindia.com
“We had a meeting with them, went through the pumps and discussed
on-site and operating. Each of the 43 pump locations would be set up the sa me. Ne ptune al so suppl ie d a 250- ga l l on s tainles s -s teel chemical-storage tank for each site, with the pumps and accessories installed within a locked enclosure to prevent damage or theft. The pumps, which can be controlled remotely, can injec t pipeline corrosion inhibitor at a rate of 12 to 20 gallons per day with the relief valves set for a high pressure of 1,300 psi, though the maximum o p e r a t i n g p re s s u re w i l l b e c l o s e r t o 1 , 1 8 0 p s i . O n c e a w e e k , a technician will come out and refill the storage tank and inspec t the pump, with an oil change required ever y three to six months. “It’s really a simple system,” said Spreen. “You’ve got a stainless-steel drip pan underneath, a locking mechanism for the covers to keep down shrinkage, and rain shields to keep rain out of the vents and fill
Offshore World | 40 | February-March 2018
FEATURES Conclusion It was a proud moment for Neptune in late December 2013 when the first pump skid was installed by the Latin American oil company, a moment that was the culmination of two years of cooperation between a number of entities, all of whom based their recommendations on the trust and reputations that have been built over many decades of reliable service. “The standard that the oil company has developed for this type of system is what we and Neptune have provided,” said Ruiz. “We are hoping that Neptune becomes standard for them for other applications like this.” Based in North Wales, PA, USA, Neptune Chemical Pump Co, is a leading manufacturer of chemical metering and peristaltic (hose) pumps, chemical feed systems, chemical injec tion accessories, make - down systems and por table mixers. Neptune is an operating company within PSG, Oakbrook Terrace, IL, USA, a Dover company. PSG is comprised of several leading pump companies, including Abaque, Almatec, Blackmer, Ebsray, EnviroGear, Finder, Griswold, Mouvex, Neptune, Quattroflow, RedScrew and Wilden. You can find more information on Neptune at neptune1.com and PSG at psgdover.com.
Figure 3: Neptune Model 5005-S-N3-FALP diaphragm metering pump.
por ts. It’s set up so that the oil company can padlock everything down so intruders can’t get into it, tamper with the lines or steal chemicals, because they do have an issue with that. “They also have extreme heat conditions for nine months out of the year, along with storm conditions, so one of the design features we added was to install the pump itself and the motor under the storage tank to give them protection from the elements. The stroke control is also sealed and all of the pumps are explosion-proof and NEMA-7 rated. The tank is all SS-316, even the legs. There is nothing on that system that should have any corrosiveness to it.”
Tom O’Donnell Director of Business Development Neptune and PSG Tel: (215) 699-8700 E-mail: Tom.ODonnell@psgdover.com
Another major benefit for the oil company of the Neptune pumps is their ability to be controlled remotely, meaning the dosing levels – whether 0.5 gallons per hour or 5.5 gph – can be set off-site based on the readings supplied by the pipeline. “They have satellite control of the liquid levels, equipment and probes that are placed within the pipeline and note how much inhibitor needs to be used,” said Spreen. “It is a completely unmanned installation.” Offshore World | 41 | February-March 2018
Ravi Prasad Director of Sales PSG India Tel: 044-26271020, 26271023 E-mail: sales.psgindia@psgdover.com www.oswindia.com
NEWS FEATURES
In One of the Most Physical Industries, Digitalisation is the Key to Fast, Compliant, High Quality Design of Oil &Gas Equipment
T
he oil and gas business might seem like an overwhelmingly mechanical industry, but it’s becoming increasingly digitalized - from advanced computer analysis to reveal new deposits from geophysical surveys done decades before, to sensors for real-time tracking and safety monitoring of deliveries. Manufacturing needs to join this digital world, and there are significant opportunities to stand out by doing that well.
Engineers and customers need to be able to visualise designs clearly long before they’re built. That covers everything from configuring an accurate 3D model, to testing the safety and structural integrity; or using that model to create a photorealistic rendering or animation to show off the product before it’s ever built. Switching from 2D to 3D CAD meant designers at AESSEAL could finish the complicated details in the design of a mechanical seal in half an
Oil and gas is a massive and growing industry but it’s also a complex and fluctuating business, in terms of both supply and demand, and geopolitics. Easily accessible deposits of oil and gas are largely exhausted, so the deposits being worked now are harder to extract reserves from; that requires manufacturing innovation to optimise the performance of the process. At the same time, the fluctuating price of crude costs makes it important to keep a tight control of costs, and for manufacturers to look for places where they can add value. And even more than in other industries, the need to meet stringent safety requirements in a complex and highly regulated environment, while delivering that mix of innovation, cost control and added value, demands that you have a digital process to help you cope. Going digital allows manufacturers to research ways of getting into reserves more efficiently and cost effectively, and to clearly communicate complex designs, allowing researchers, designers, suppliers and engineers in teams that often span the globe to share information. Some of the advantages of a digital process are obvious. Digital workflows are easier to track and audit, so you can see what stage a design is at, make sure that requirements and specifications are consistent and track everything from inventory to documentation, knowing what you’re seeing is live and reliable data. Changes can be made once, rather than separately in drawings, bills of materials and change notes. Weir Valves and Controls, UK found it was saving half an hour a day for every engineer by using Siemens’ digital solutions, as well as removing errors. It was also able prove when the design drawings of valves it provided to customers had been changed after WVC sent them out; traceability is key when unauthorized changes to a design can have major safety and liability implications.
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hour rather than the two to three days it used to take, and then waiting yet another day for manual calculations needed to reprogram machine tools to make the parts. AESSEAL can send 3D designs to its casting suppliers in a format they can work with directly. But it also meant that for the first time, the company could show customers cutaways and animated models of what they were actually buying; the hundreds of precision engineered parts inside the seal, not just the anonymous metal casing protecting those parts. A digital process lets designers and engineers cope with new complexity in manufacturing and design. Integrating sensors, actuators. GPS trackers and other electronic components in oil and gas equipment is becoming more common; that means generating wiring diagrams and schematics as part of the design. At the other extreme, designs need to include frames and fabricated structures around the equipment; testing those for safety in advance, down the placing of the weldments, through structural analysis in a digital environment, instead of over-engineering them saves both time and money.
Figure 1: Siemens customer Weir Valves and Controls, UK WVC in the UK saves half an hour a day for every engineer by using digital applications, Teamcenter product lifecycle management with Solid Edge.
Offshore World | 42 | December 2017-January 2018
NEWS FEATURES Product customization is becoming more common in the industry, and manual processes for complex custom products lead to bottlenecks in delivering both quotes and orders. Manufacturers who create custom hardware that’s engineered-to-order, covering thousands of design elements, to fit into the customer’s specific environment and processes, and designed to the customer’s specifications, depend even more on a strong digital process.
Figure 2: Moving to 3D Solid Edge from 2D, designers at AESEAL cut complex design of mechanical from 2 to 3 days down to half an hour. By digitizing their designs, manual calculations for machine tool programming are reduced or eliminated. Manufacturers don’t just deliver designs and physical equipment; they also need to create installation, assembly and maintenance documentation. With a digital process, you can create those from the same digital assets, which is faster and more accurate. Just laying out components and routing pipes in a 2D drawing doesn’t give enough information to fit equipment into the available space in a plant; engineers can produce pipe runs in and generate 3D projections – or installers can look at 3D diagrams on site using mobile viewers.
Figure 3: According to Tech-Clarity, top Performers in the Oil and Gas equipment industry are more likely to capture knowledge and automate engineering tasks that improve engineering efficiency and shortening leadtimes while reducing errors.
According to Tech-Clarit y’s recent research, what distinguishes the top per formers in Engineer to Order from the less successful and less profitable companies isn’t just the engineering they do, impor tant as that is; it’s the speed, accurac y and efficienc y of the way they do it. They complete the designs they work on faster. They give more accurate quotes for those designs and deliver on those quotes faster. They can keep costs down but still deliver large, complex systems that fit into customer facilities. When they win a customer, they engineer their projec ts faster, more efficiently and more accurately. And what they deliver to that customer comes with more accurate manufac turing documents. Those are all advantages you need a good digital process to get. Successful ETO manufac turers use design automation technology and produc t configurators to capture knowledge, improve the efficienc y of their engineers, reduce errors – and to create a process where they can improve on ever y projec t by learning from what they ’ve done before. They know exac tly what materials they need to order and when. They have automated tools for creating quotes, configuring manufac turing tools and producing documentation from engineering documents. They’re not losing money overrunning on costs or having to remake orders that go wrong. They rely on digital tools that make their engineers produc tive and streamline the order process, gaining them more sales – and higher profits.
Russell Brook Marketing Director EMEA, Mainstream Engineering Siemens PLM Software
Offshore World | 43 | December 2017-January 2018
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MARKETING INITIATIVE
ADVERTORIAL
SIMON INDIA LIMITED [Corporate Identity No. : U74899DL1995PLC071074]
An ISO 9001:2008 & OHSAS 18001:2007
An Engineered EPC Company Oil & Gas
LPG Terminal
Chemicals & Fertilizers
Tank Farm
Cement & Power
Simon India Limited [Head Office] Mehtab House, A-36, Ground Floor, Mohan Co-operative Industrial Estate, New Delhi - 110 044, India.
Contact No. : +91 11-42602222 | 093703 13431 Email : pranay.gujarathi@adventz.simonindia.com
www.oswindia.com
Simon India Limited [KSA Branch] Stars Tower, Office No.# 9, King Faisal Road (West), P. O. Box : 2298, Al Jubail City : 31951, Kingdom of Saudi Arabia.
Contact No. : + 966 530178961 Email: Hari.Kumar@adventz.simonindialimited.com.sa
Offshore World | 44 | February-March 2018
Sonatrach-Led Group Brings Algeria’s Timimoun Gas Field On Stream
Saudi Aramco and Petronas have formed t wo joint ventures to fur ther
Total SA reported that natural gas production has started from Timimoun field in southwestern Algeria. Algeria’s Sonatrach jointly operates the Timimoun production complex with partners. Sonatrach has 51 per cent interest, Total 37.75 per cent and Cepsa 11.25 per cent.
the t wo national oil companies’ equal ownership and par ticipation in operations of the refiner y and petrochemical integrated development (RAPID) projec t now under construc tion at the USD 27-28-billion Pengerang integrated complex (PIC) in southeastern Johor, Malaysia. As part the finalized agreement, Aramco will hold a 50 per cent ownership interest in RAPID ventures and assets as well as serve as primary supplier of crude feedstock for the project’s 300,000-b/d refinery, the companies said. Specifically, Aramco will provide as much as 70 per cent of the refinery’s feedstock requirements, while Petronas and its affiliates will supply natural gas, power, and other utilities. While they did not identify the newly formed JVs, the companies said they will share in the rights to offtake production of the JVs on an equal basis. Announcement of the new JVs follows the companies’ 2017 preliminary agreement to partner on RAPID.
Shell Sells West Qurna 1 Interest in Iraq Royal Dutch Shell PLC has taken another step in the trimming of its oil and gas interests in Iraq. Shell EP Middle East Holdings BV sold all share capital in Shell Iraq BV, which holds a 19.6 per cent interest in West Qurna 1 oil field, to a subsidiar y of Itochu Corp. Itochu paid USD 406 million and assumed USD 144 million of debt. Last year, Shell Iraq Petroleum Development BV won endorsement by the Iraqi Ministr y of Oil of its proposal to withdraw from Majnoon oil field, which it operates with a 45 per cent interest. Majnoon produces more than 200,000 b/d of oil. ExxonMobil Corp. operates West Qurna 1 field, which produces about 400,000 b/d of oil, with a 32.7 per cent interest. Other par tners are PetroChina, 32.7 per cent; Per tamina, 10 per cent; and state -owned Oil Exploration Co., 5 per cent. Shell said its other business in Iraq will not be affected. It is a 44 per cent par tner in Basrah Gas Co., a 25-year joint venture with state owned South Gas Co. (51 per cent) and Mitsubishi (5 per cent) that captures, treats, and sells associated gas from West Qurna 1, Zubair, and Rumaila oil fields.
Gas from Timimoun eventually will be produced with a total of 37 wells connected to a processing plant tied into the GR5 pipeline to move gas from southwestern Algeria to Hassi R’mel. Total has held Algerian assets for decades. In 2017, Total’s production in Algeria averaged 15,000 boe/d, all of it from the Tin Fouye Tabankort gas-condensate field 300 km west of the Libyan border. Through the Maersk Oil acquisition, which closed on Mar. 8, Total also holds 12.25 per cent interest in the El-Merk, Hassi Berkine, and Ourhoud oil fields with a combined production capacity of 400,000 boe/d.
BOEM to Begin Process for Proposed 2019 Beaufort Sea Lease Sale The US Bureau of Ocean Energy Management announced it will publish a call in the Mar. 30 Federal Register for information and nominations for a proposed 2019 Beaufort Sea oil and gas lease sale. It emphasized that the sale would be part of the draft proposed 2019-24 US Outer Continental Shelf planning program announced in January, which has not become final. Comments will be accepted through Apr. 30, the US Department of the Interior agency said. “Available information indicates that the B eaufor t S ea possesses great oil and gas potential,” BOEM Alaska OCS R egion D irec tor James Kendall said in Anchorage. “It also contains unique, environmentally sensitive areas impor tant to the subsistence needs of the region’s Alaska Native communities. This process will help us identify not only the areas that can be safely and responsibly developed, but also those areas that should be protec ted for wildlife and traditional uses.” BOEM is seeking comments from the oil and gas industry on interest in the areas proposed for leasing, including nominations or indications of interest in specific lease blocks within the area. The agency also wants information from any interested party relating to particular geological, environmental, biological, archaeological and socioeconomic conditions, use conflicts, or other situations which could affect the potential leasing and development of particular areas.
Offshore World | 45 | February-March 2018
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NEWS
Aramco Forms JV with Petronas for Malaysia’s RAPID Project
NEWS
Province Plans Separate Oil and Gas Unit
equipment and packages using its patented PRICO® LNG technology.
The government of Newfoundland and Labrador plans to strip oil and gas operations from Nalcor Energy and create a separate provincially owned entity.
The PRICO® process uses a single-mixed refrigerant loop for natural gas liquefaction, a method that requires minimal equipment and reduces
In his 2018 budget speech, Finance Minister Tom Osborne said the stand-
“B eing named EPC Contrac tor of the Year at the LNG USA Summit
alone oil and gas company would “work directly with the Department
demonstrates our commitment to helping clients meet their
of Natural Resources to accelerate the growth and opportunity of our petroleum industry.”
objec tives, regardless of projec t size, by being the top EPC solutions
Nalcor Energy Oil & Gas holds working interests in fields off the province: 4.9% in Hebron oil field, 5% in the White Rose Growth Project, and 10% in the Hibernia Southern Extension Project. The parent company generates and transmits electrical power.
Richard Herbert Named CEO of Frontera Energy Richard Herber t has been named chief executive officer of Frontera Energy Corp., Toronto, and will relinquish his position as an independent board member. He succeeds Barr y Larson, who will remain with the company through April to help with the transition.
capital and operating expenses.
provider for FLNG developments,” said B ob Germinder, Senior Vice President and Managing Direc tor of Floating Oil & Gas Solutions for Black & Veatch. Floating applications t ypically require fewer resources and can more quickly move supply to end users versus traditional onshore facilities, which is par ticularly crucial in the current price environment. Commercial viabilit y was named by sur vey respondents as the top driver for making FLNG investment decisions, followed by implementation costs, according to Black & Veatch’s 2017 Strategic Direc tions: Natural Gas Industr y Repor t. Cost and speed of deliver y are top priorities for investors.
ONGC Awards Ratna Work to UAE’s NPCC
Herber t, who joined the Frontera board last December, has more than 36 years of experience in global oil and gas exploration and development, having worked with BP PLC, Talisman Energy Inc., and Phillips Petroleum Co.
UAE-based National Petroleum Construction Company (NPCC) has been
Frontera has operations in Colombia and Peru, producing 65,00070,000 boe/d of oil and natural gas.
Founded in 1973, NPCC is part of Senaat Abu Dhabi. Senaat, representing
awarded an engineering, procurement, and construction (EPC) contract by India’s ONGC for five well platforms and a pipeline for Ratna field offshore India.
the government of Abu Dhabi, owns 70% and Consolidated Contractors Company (CCC) owns 30% of NPCC.
Black & Veatch Named LNG Industry EPC Contractor of the Year Black & Veatch, a global leader in the design, construction and delivery
NPCC said last week that the contract award was worth $327 million and it was awarded as part of ONGC’s offshore oil and gas infrastructure development on the west coast of India.
of innovative floating liquefied natural gas (FLNG) production and
This contract includes survey, design, engineering, procurement,
regasification solutions, has been named EPC Contractor of the Year. The
fabrication, load out, transportation, installation and commissioning
award, presented to Black & Veatch at the recent LNG USA Summit 2018 in
of five well platforms (R12B-R10A-R9A-R7A-R13A) and associated
Houston, cited the company’s advanced capabilities in executing complex
pipelines and cables.
projects and coincides with increasing investor interest in flexible, costeffective LNG solutions that can more quickly move supply to end users. Black & Veatch has been a pioneer in floating LNG, providing engineering, procurement and construction (EPC) solutions for topside liquefaction www.oswindia.com
Hussain Al Nowais, Chairman of NPCC said: “I am proud of the NPCC’s relationship with ONGC and is a testament of the good relations and economic cooperation between UAE & India, under the able guidance of the leadership of two countries.”
Offshore World | 46 | February-March 2018
PRODUCTS End-suction Centrifugal Pump Strength, efficiency and reliability are the hall mark of MBH end -suction centrifugal pump range. These powerful single stage pumps are designed to work hard in most demanding building and industrial environments, where only the fittest pumps can survive in the long run. All pumps are designed to comply with DIN 24255 and ISO 2858. Over the years the pumps have been carefully optimised and refined to offer unsurpassed energy efficiency and performance. The impressive range of MBH end-suction pump is compatible with an array of application areas including water intake; HVAC; cooling towers; general process water; cold and hot water transfer; fire fighting; industrial liquid transfer; filter systems and ultra filtration. .Pumps supplied with special HVAC controller as well as VFD.
Tri-Clover Gaskets Tri-Clover Gaskets are used for connecting two pipes in food and drug plant. Tri-Clover Gasket is available in Food Grade Silicon, Food Grade Viton, Food Grade EPDM, etc. It can be supplied in different sizes upon request. Tri-Clover Gaskets is made from Platinum-cured Silicone Rubber, Fluoro Elastomer (FKM), EPDM and PTFE. It conforms to FDA 21 CFR.177.2600 and USP Class VI requirements. It is Animal Derived Ingredient Free. Silicone Tri-Clover Gaskets are available with collar for better grip and also without collar. It is available in red/orange/white and transparent colour. Imaclamp has different types like T/C gaskets, Mesh T/C gaskets, PTFE Envelop gaskets, Sensor T/C gaskets and Validation T/C gaskets.
For details contact: MBH Pumps (Gujarat) Pvt Ltd Plot No: 14, GIDC Indl Estate Naroda, Ahmedabad, Gujarat 382 330 Tel: 079-22823066, 22821018 E-mail: marketing@mbhpumps.com
For details contact: Ami Polymer Pvt Ltd 319 Mahesh Indl Estate, Opp: Silver Park Mira-Bhayander Road, Mira Road (E) Thane, Maharashtra 401 104 Tel: 022-28555107, 28555631, 28555914 E-mail: mktg@amipolymer.com
Check Valves
Liquid Analysis Cipriani Harrison’s check valves are made from forged SS-304L and SS316L, are highly polished
Liquiline is the platform for all
and come standard with
and analysers.
liquid analysis applications. It forms the basis of their ultramodern transmitters, samplers
PTFE O-rings and gaskets. These non-return valves
Liquiline CM44 is the most
are self-draining in the vertical position. The newly designed ribbed stainless
flexible transmitter for all Memosens sensors. It measures twelve
disc resists water hammer, minimizes the resistance to flow and serves as a
different parameters and allows up to eight sensors to be connected.
guide to the valve plug. Available in sizes ½”-4” with sanitary clamp, Butt weld and I-line end connections as standard. Special springs are offered to allow for flexibility in design and use. Size 1” to 4” valves are 3A authorised.
Liquiline CM44 is available as a field device and also for mounting in
For details contact; Cipriani Harrison Valves Pvt Ltd Sub Plot No: 2, B/s Margin Impex Ltd Nr Phase IV, GIDC Estate V U Nager, Anand, Gujarat 388 121 Tel: 02692-235082, 234182 Fax: 91-02692-236385 E-mail: info@harrisonengineers.com
control cabinets and on DIN rails. For details contact: Endress+Hauser (India) Pvt Ltd 7B, 7 th Floor, Godrej One Pirojshanagar, Vikhroli (E) Mumbai 400 079 Tel: 022-30236100 Fax: 91-022-30236219 E-mail: info@in.endress.com
Offshore World | 47 | February-March 2018
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PRODUCTS Horizontal Multistage End-suction Pumps
Horizontal Single-stage Centrifugal Pumps
The Lubi MH, MHI and MHN pumps are non-self-priming horizontal, multi-stage, centrifugal pumps.Motor and pump are close-coupled in a convenient and compact design for quick installation in limited space. The pump is fitted with a maintenance-free, mechanical shaft seal. The pumps have axial suction port and radial discharge port and are mounted on a base plate. These pumps are available in three basic versions: MH pump stages as well as all moving parts in contact with the pumped liquid are made of SS AISI 304. Discharge casing and suction casing are grey iron. Base plate is made of steel. All grey iron parts and base plate are CED-coated for rust and corrosion prevention MHI discharge casing, suction casing as well as all parts in contact with the pumped liquid are made of SS AISI 304. MHN discharge casing, suction casing as well as all parts in contact with the pumped liquid are made of SS AISI 316.
These pumps are available from 0.37 to 1.50 kW for singlephase as well as three-phase power supply. The pumps have axial suction port and radial discharge port. Pump casing and impellers are made of SS AISI 304. Motor shaft is made of carbon steel and pump shaft is made of stainless steel. The pump is fitted with a maintenance-free, mechanical shaft seal. These pumps are suitable for liquids which are thin, clean, slightly aggressive, non-explosive, not containing solid particles or fibers.
For details contact: Lubi Industries LLP Nr Kalyan Mills, Naroda Road Ahmedabad, Gujarat 380 025 Tel: 079-30610100 Fax: 91-079-30610300 E-mail: mktsales@lubipumps.com
For details contact: Lubi Industries LLP Nr Kalyan Mills, Naroda Road Ahmedabad, Gujarat 380 025 Tel: 079-30610100 Fax: 91-079-30610300 E-mail: mktsales@lubipumps.com
The Lubi MXF pumps are non-self-priming, horizontal, single-stage centrifugal pumps. Motor and pump are close coupled in a convenient and compact design for quick installation in limited space.
Vertical Multi-stage Centrifugal Pumps The Lubi LCR, LCRI, LCRN Series are non-self-priming, vertical multi-stage centrifugal pumps. The vertical in-line design enables the pump to be installed in a horizontal plane single system where the suction and discharge connections are in the same horizontal plane (in-line) and have the same pipe size. This design provides a more compact pump design saving space and easy pipe work. The pump consists of a base and a pump head. The chamber stack and the outer sleeve are secured between the pump head and the base by means of tiebolts. All pumps are equipped with a maintenance-free mechanical shaft seal. These pumps come with various sizes and number of stage to provide the flow and the pressure for different site conditions. These pumps are suitable for a wide variety of applications from pumping of potable water to the pumping of chemicals. These pumps are available in various material versions according to the pumped liquid. LCR, LCRI pumps are suitable for non-corrosive liquids. LCRN pumps are suitable for industrial liquids in systems where all parts in contact with the liquid must be made of high-grade SS. For thin, non-explosive, not containing solid particles or fibers, non-corrosive liquids are suitable. For liquid transfer, circulation and pressure boosting of cold or hot clean water. For water supply systems, pressure boosting systems, liquid transfer and irrigation works. For details contact: Lubi Industries LLP Nr Kalyan Mills, Naroda Road Ahmedabad, Gujarat 380 025 Tel: 079-30610100 Fax: 91-079-30610300 E-mail: mktsales@lubipumps.com www.oswindia.com
Offshore World | 48 | February-March 2018
PRODUCTS Centrifugal End-Suction Pumps Self-priming Mud Pumps MBH Pumps offers stateof-the-art fire pumpset with diesel engine or motor driven horizontal end-suction pump. These pumpsets are typically used in fire fighting applications for supplying water to fire hose reels, fire hydrants or sprinkler systems. Pumps have a discharge up to 2,900 USgpm and the head range up to 230 psi. These fire pumpsets meet or exceed the requirements of NFPA20. Installations of these pumpsets would ensure the safety of human life, buildings, expensive plants and equipment. The fire pumpset typically consists of the following equipment: pump, motor or diesel engine assembled with cooling, fuel, battery and exhaust systems; fire pump controller; suction and discharge gauge; air relief valve; and common base plate. For details contact: MBH Pumps (Gujarat) Pvt Ltd Plot No: 14, GIDC Indl Estate Naroda, Ahmedabad, Gujarat 382 330 Tel: 079-22823066, 22821018 E-mail: marketing@mbhpumps.com
The Lubi LBM Series are self-priming, horizontal, single stage, centrifugal, end-suction pumps.Pumps are available from 0.75 to 7.5 kW in three-phase power supply. Motor and pump are close coupled in a convenient and compact design for quick installation in limited space. They are also available as bare pump unit which are suitable for coupling with motor/engine. The pump is fitted with a gland packing and single piece pump-motor shaft (in close coupled version). Mechanical shaft seal is available in 0.75 kW models. These pumps have suction port above pump axis and radial discharge port. These pumps have non-clogging open type impeller which can handle liquids with solids up to 20 mm grain size. These pumps are engineered to draw from liquid sources below ground level or from sources which have no positive pressure to naturally prime the pump. These pumps are inherently designed to allow the pump to re-prime itself typically under lift conditions. Only first time priming is required to remove the air from the system. For details contact: Lubi Industries LLP Nr Kalyan Mills, Naroda Road Ahmedabad, Gujarat 380 025 Tel: 079-30610100, Fax: 91-079-30610300 E-mail: mktsales@lubipumps.com
New Motor and Drive Solution Leroy-Somer offers Commander ID300, a new integrated drive for the control of its IMfinity induction motors from 0.25 to 7.5 kW. This all-in-one drive solution has been designed to meet the strategic challenges of increasingly complex and demanding production environments, induced by the transition to Industry 4.0. A decentralized system, the motor and drive assembly offers strong dynamic performance and outstanding efficiency levels for process, manufacturing and intralogistics applications, through an easy to install and easy to set-up package. For a high level of performance, Commander ID300 is provided with advanced features for optimizing machine and process performance: onboard PLC, fieldbus communication, extra input/output or preset configurations such as a pump program for pressure regulation (constant pressure/variable flow). It integrates also onboard safety functions for compliance with SIL3/PLe. Commander ID 300 offers customized solutions thanks to a modular concept. The wide choice of options and adaptations enables configuration in line with machine architecture. The system can also integrate an FFB brake for dynamic braking and/or a gearbox from the helical 3000 range, ensuring max adaptability. Extremely robust, Commander ID300 is an easy-to-use solution, ensuring quick and smooth operation. For details contact: LEROY-SOMER Motors & Drives C/o Control Techniques India Pvt Ltd 117B Developed Plot, Indl Estate Chennai 600 096 Tel: 044-66918402 E-mail: rengan.rajan@mail.nidec.com Offshore World | 49 | February-March 2018
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PRODUCTS Liquid Analysis
Liquid Analysis Liquiline is the platform for all liquid analysis applications. It forms the basis of their ultra modern transmitters, samplers and analysers.
Liquiline is the platform for all liquid analysis applications. It forms the basis of their ultra modern transmitters, samplers and analysers.
Liquiline M CM42, the two-wire transmitter for the parameters pH/ORP, conductivity and oxygen, impresses with reliable data transmission and easy operation. It can be used in all areas of process automation including hazardous areas and hygienic applications.
Liquiline CM14, the four-wire transmitter for pH/ORP, conductivity and oxygen, is an instrument used for straight for ward measuring tasks. The compact design of the Liquiline CM14 makes it suitable for use in panels or control cabinets, and it is a par ticularly attractive solution for plant manufacturers.
For details contact: Endress+Hauser (India) Pvt Ltd 7B, 7 th Floor, Godrej One Pirojshanagar, Vikhroli (E) Mumbai 400 079 Tel: 022-30236100 Fax: 91-022-30236219 E-mail: info@in.endress.com
For details contact: Endress+Hauser (India) Pvt Ltd 7B, 7 th Floor, Godrej One Pirojshanagar, Vikhroli (E) Mumbai 400 079 Tel: 022-30236100 Fax: 91-022-30236219 E-mail: info@in.endress.com
Continuous Monitoring of Versatile Trace Gas Analyser Offering a unique, Nitrogen in Argon and Helium Specifically designed for the continuous monitoring of nitrogen in argon or helium or both, the Servomex SERVOPRO Plasmas unique plasma emission detector provides an accurate, highly stable and reliable measurement ideal for the requirements of ASU plant operators. Features wide measurement range 0-1 ppm, 0-10 ppm, 0-100 ppm (higher on request); electronic flow control system for low flow consumption and reading stability; and patented sample humidity control system for ultimate reading stability. For details contact: Spectris Technologies Pvt Ltd Plot No: A-168 MIDC Thane-Belapur Road, Khairane Navi Mumbai 400 710 Tel: 022-30342700 E-mail: MEI_Sales@servomex.com www.oswindia.com
nondepleting plasma emission detector, the SERVOPRO Chrome (K4000) analyser is one of the most versatile gas analysers for trace gas measurement available. Most applications will be satisfied by a single 4U rack analyser configuration, making the Chroma a compact cost-effective solution for continuous process control or quality monitoring. Features fully automated – tune to the application – system for unique simplicity of use (no need to be an analysis expert to use this GCI); stand-alone systems requires no third-party software or computer to operate amd plasma HC measurement system requires no FID for THC measurement. For details contact: Spectris Technologies Pvt Ltd Plot No: A-168 MIDC Thane-Belapur Road, Khairane Navi Mumbai 400 710 Tel: 022-30342700 E-mail: MEI_Sales@servomex.com
Offshore World | 50 | February-March 2018
PRODUCTS Shutoff & Divert Valves
Conta-bin/ContainerTumbler Blender Bin blenders or container tumblers are used mainly for blending of dry powder for tablet production and capsule, which facilitates better flow for tablets and capsules.
Cipriani Harrison’s pneumatic valves are made from forged SS-316L/SS-304L are highly polished and come standard with PTFE and FDA EPDM seals. These valves have self-draining machined bodies with a round shape that allows for a minimum resistance to flow. The valve body, yoke and actuator are assembled with clamps enabling quick and easy assembly and disassembly. Available in sizes 1-4� with sanitary clamp and Butt-weld and connections as standard. Multiple body styles and electrical control tops are available for varying applications. These are 3A authorised and user-friendly. Electronic control caps are available for communication/automation.
They are available in Model 5 to 1,000 litre working capacity with different size of container. Bin shape product container is ideal for dry mixer for lubrication of granules and homogenization mixing of multiple batches into single batch. It has interchangeable bin with different capacity; closed and contained system for blending, storage and transfer; hydraulic system for lifting of product container for mixing. Optional features include PLC controls and FLP. For details contact: Prism Pharma Machinery Plot No: 37/13, Phase IV, GIDC, Vatva Ahmedabad, Gujarat 382 445 Tel: 079-29095204 Fax: 91-079-25841623 E-mail: mkt@prismpharmamachinery.com slaes@prismpharmamachinery.com
For details contact: Cipriani Harrison Valves Pvt Ltd Sub Plot No: 2, B/s Margin Impex Ltd Nr Phase IV, GIDC Estate V U Nager, Anand, Gujarat 388 121 Tel: 02692-235082, 235182 Fax: 91-02692-236385 E-mail: info@harrisonengineers.com
Air-to-Air Heat Exchanger APPIDI Energy Recover Units (ERU) heat recover y is a plate or rotar y type air-to-air heat exchanger designed to provide max energy efficiency in ventilated systems where heated or cooled air is let out and outdoor air is let in. In applications where ventilation is required or recycling of the same air is not allowed, energy recover y wheels or plate heat exchangers are used to recover the energy from exhaust air. This reduces the initial investment in HVAC equipment and minimises operating cost.
Octagonal/Double Cone/V-shape Blender
Since HVAC equipment is typically the largest source of energy consumption in commercial buildings, ERU investments are economically justified for outdoor at makeup. In new HVAC installation, ERUs also allow ventilated systems to be sized with smaller compressors, lowering initial costs of the HVAC package.
Blenders are used for mixing, lubricating and blending in pharma, nutraceutical, foods, chemicals, cosmetics, ceramics, pesticides, plastics and other allied industries. They are available in Model 2 to 5,000 litre working capacity with different shape of container. Octagonal/double cone/V-shape/bin shape product container is ideal dry mixer for lubrication of granules and homogenization mixing of multiple batches into single batch. Features closed loading and unloading, VFD, PLC controls, FLP and intensifier with VFD.
For details contact: APPIDI Technologies Pvt Ltd Survey No: 123, Jeedimetla Village Qutbullapur Road Hyderabad, Telangana 500 055 Tel: 040-65863942 E-mail: sales@appiditech.com
For details contact: Prism Pharma Machinery Plot No: 37/13, Phase IV, GIDC, Vatva Ahmedabad, Gujarat 382 445 Tel: 079-29095204 Fax: 91-079-25841623 E-mail: mkt@prismpharmamachinery.com slaes@prismpharmamachinery.com Offshore World | 51 | February-March 2018
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PRODUCTS Mixproof Valves
Slim Line Ball Valves
Cipriani Harrison’s mixproof valves are made from forged/bar stock AISI 316L and 304L. Double seat valves are used in automated multiple routing systems with absolute confidence. Modern production processes demand simultaneous operation of product and cleaning cycles in order to maximise productivity and optimise operations. The construction of the valve guarantees that all products and cleaning liquids, in complex routing systems, remain separated, even in the event of seal failures. Available sizes ranges from 1-4”. Electronic control caps are available for communication/automation.
Cipriani Harrison’s slim line ball valves are made from forged SS-304L and SS316L, are highly polished and come standard with TFM-PTFE seats and FDA EPDM O-rings. The 2 piece design provides a compact and economical solution while maintaining a full por t design, as well as being fully drainable. Available in size 1-4” with sanitar y clamp, Butt-weld or I-line end connections. They are available with or without purge por ts and either manually or pneumatically controlled.
For details contact: Cipriani Harrison Valves Pvt Ltd Sub Plot No: 2, B/s Margin Impex Ltd Nr Phase IV, GIDC Estate V U Nager, Anand, Gujarat 388 121 Tel: 02692-235082, 235182 Fax: 91-02692-236385
E-mail: info@harrisonengineers.com
For details contact: Cipriani Harrison Valves Pvt Ltd Sub Plot No: 2, B/s Margin Impex Ltd Nr Phase IV, GIDC Estate V U Nager, Anand, Gujarat 388 121 Tel: 02692-235082, 234182 Fax: 91-02692-236385 E-mail: info@harrisonengineers.com
Sami Wedge Plug Valves Rasaii Flow Lines Pvt Ltd has established as specialist valve manufacturer for corrosive and erosive applications in oil and gas plants, petroleum refinery, petrochemical plants, pharma, heavy water plants, mining industry. The valves have proven performance in handling erosive and clogging area. Rasaii offers the wedge plug valves to serve as good replacement of metal seated globe and ball valves. Sami wedge plug valves are specifically designed to handle Liquid with sludge. dirty liquids, acetic acid, liquids clogged with solid particles. The wedge plug claves perform in a superior way compound to metal to metal seated ball valves with their nil cavity possibility for suspension of flowing liquids and as well by avoiding any secondary replacement flexible soft sealing materials as primary isolation material. No scratch actions by embedded particles due to scrapping and cleaning of plug avoiding any metals embedding on to seats. The valves shall be operated with fully lubricated gearbox as well as can be operated with the linear electrical actuators of internationally proven makes. The gearbox will lift the plug and reseat for lower torque operation during open and close position. Wedge Plug Valves are more reliable, easy to maintain by flushing on regular interval without removing the valves from pipeline. Valve can handle stem, catalyst effluent, hard materials, and hard liquids like high viscosity clogging media and sticking media. It is easy to operate. It has the lowest torque resulting smallest actuator and best performance in sealing. It finds application in toluene diisocyanate, polyester terephthalate, pure terephthalic acid, propane dehydrogenation, and styrene - polystyrene, CTG. For details contact: Rasaii Flow Lines Pvt Ltd TS No: 93/3, Poonamalle Road Ekkatuthangal Chennai 600 032 Tel: 044-22252021, 22252022 E-mail: admin@rflvalves.com www.oswindia.com
Offshore World | 52 | February-March 2018
EVENTS DIARY
events diary 5 th Kuwait Oil & Gas Summit
APPEA 2018 Conference and Exhibition
Date: April 16-17, 2018
Date: May 14-17, 2018
Venue: Jumeirah Messilah Beach Hotel, Kuwait City
Venue: Adelaide, Australia Event: The APPEA Oil and Gas Conference & Exhibition is the largest annual upstream oil and gas event in the southern hemisphere, attracting delegates from across the countr y and around the world.
Event: The most established strategic oil & gas event in the countr y, Kuwait Oil & Gas is endorsed by Nizar Al Adsani, D eput y Chairman & CEO, Kuwait Petroleum Corporation and suppor ted by the Ministr y of Oil, KPC and Subsidiaries. D esigned and led by the industr y itself (the Advisor y Committee comprising CEOs
For details contact:
Each year, this conference highlights and defines the issues and challenges of upstream petroleum exploration and development on a national and international level. The APPEA Conference program will include international keynote presentations, case study presentations, technical updates and panel discussions. In addition, a full technical (concurrent) program, including more than 100
Mohamad Kantar
papers and presentations, will be delivered over the 3 ½ day event.
from K- companies, IOCs and private sec tor representatives). Kuwait Oil & Gas is pushing the envelope and challenging the status quo by encouraging open and frank dialogue.
Tel: +44 20 7978 0781
For details contact: Jason Aver y Events Manager, APPEA Tel: +61 7 3231 0510 Email: javer y@appea.com.au
Email: Kuwait@thecwcgroup.com
3 rd International LNG Summit
ADIPEC 2018
Date: April 25-26, 2018
Date: November 12 - 15, 2018
Venue: Altonaer Kaispeicher, Hamburg, Germany
Venue: Central Plaza, Al Maa’red Hall, Abu Dhabi
Event: The 3
Annual International LNG Summit provides an
Event: Established in 1984, the Abu Dhabi International Petroleum
excellent oppor tunit y to engage in discussions about the outlook of
Exhibition and Conference is a world-class business forum, where
rd
the LNG market, its future regarding the growth of LNG demand in Europe and the Mediterranean as well as the emerging markets and the influence of governments on the LNG sec tor. This conference will gather global LNG executives and professionals who add value to ever y process of LNG operations to collaborate and provide the most beneficial solutions to pressing industr y challenges. The 3
rd
oil and gas professionals convene to engage in dialogue, create par tnerships, do business and identify solutions and strategies that will shape the industr y for the years ahead. ADIPEC has grown exponentially to become the world’s meeting point for oil and gas professionals. Today, over USD 10.34 billion of business is concluded during the exhibition, placing ADIPEC at the
Annual International LNG Summit will also provide you with the
ver y hear t of international business of the global energy sector.
prime oppor tunit y to develop new contac ts and relationships from
Over 102,000 trade professionals attend ADIPEC, while 950+
across the spec trum of the LNG business.
industr y leading exper ts share their knowledge and understanding
For details contact: Tel: + 44 203 514 0279 Email: media@wisdom.events
across the event’s expansive line -up of strategic and technical conference sessions. For details contact: Tel: +97124444909 Email: Adipec.sales@dmgeventsme.com Offshore World | 53 | February-March 2018
www.oswindia.com
BOOKSHELF
Oil & Gas Company Analysis: Upstream, Midstream and Downstream (Paperback) Author: Alfonso Colombano, (Author, Compiler, Editor, Contributor, Draft Writer), Alberto Colombano (Editor), Paul Crnkovic (Editor, Contributor), Elsa Crnkovic (Illustrator) Publisher: CreateSpace Independent Publishing Platform Pages: 342 pages About Book: As one of the most complex industries in the world, this book provides readers with an in-depth coverage of companies that operate in all sectors of the oil & gas industry, that is Upstream, Midstream and Downstream. This book sets out to evaluate companies through upstream, midstream and downstream financial and operational metrics (covered in the first 4 chapters of the book), and to provide an overview of more than 30 companies in different categories, such as National Oil Companies, International Oil Companies, Independent E&P and Pure Play Refining Companies.
The Oil & Gas Industry: A Nontechnical Guide (Hardcover) Author: Joseph Hilyard Publisher: PennWell Corp. Pages: 322 pages About Book: Joseph Hilyard’s timely new book provides a broad perspective on the oil and gas industry, with primary attention to the United States. It takes the reader on a tour of the operations used to find and evaluate resources, and then to produce, store and deliver oil and gas. The book’s main focus is primarily on the equipment and processes used in exploring new resources; evaluating promising formations; drilling wells; managing oil and gas production; converting oil and gas into products; and transporting oil and gas. Separate chapters address the evolution and current structure of the petroleum industry; oil and gas trading; and challenges likely to face the oil and gas industry in coming years. Three appendices define key industry terminology; suggest further reading on selected topics; and identify organizations that can provide more information.
The Global Oil & Gas Industry: Management, Strategy and Finance (Hardcover) Authors: Andrew Inkpen, Michael H. Moffett Publisher: PennWell Corp. Pages: 455 pages About Book: Despite its size and importance, a surprising lack of basic knowledge exists about the oil and gas industry. With their timely new book, authors Andrew Inkpen and Michael H. Moffett have written a nontechnical book to help readers with technical backgrounds better understand the business of oil and gas. They describe and analyze the global oil and gas industry, focusing on its strategic, financial, and business aspects and addressing a wide range of topics organized around the oil and gas industry value chain, starting with exploration and ending with products sold to consumers. The Global Oil & Gas Industry is a single source for anyone interested in how the business of the worldís largest industry actually works: business executives, students, government officials and regulators, professionals working in the industry, and the general public.
www.oswindia.com
Offshore World | 54 | February-March 2018
R.N.I. No. 39849/82. Date of Publication: 1 st of every alternate month
RNI No. MHENG/2003/13269. Date of Publication: 1st of every alternate month.