For the past 25 years, owners and contractors have been implementing front-end loading and other best practices, but many would claim project performance hasn’t improved by much. Now projects are faced with core issues such as lack of owner/contactor interface and loss of project experience. According to industry experts, projects have never been this complex before and they may never be this easy again. How does industry develop the skills of its people and processes so it can be prepared for more complex projects?
“A successful project is not just about having the right construction, engineering, technology or procurement,” said Anthony Jones, senior vice president of project execution for Valero Energy Corp. “Successful projects also consist of having the right supply commercial agreements, outtake agreements and logistics to get all the materials in or out of the plant. Those commercial agreements are very important and ultimately add to the needs of the integrated team.”
Jones was part of a recent panel discussion at the Petrochemical Engineering & Construction Conference and Expo in New Orleans. The panel discussed key approaches to contract strategy/risk management and competency development to tackle challenges on projects.
Jones discussed how Valero is “doing things differently” and implementing strategies to better improve project outcomes. For example, Valero is using innovation in its work processes such as Advanced Work Packaging (AWP) and Workface Planning (WFP). Jones has seen firsthand how people’s perceptiveness or lack of it can change when they are introduced to a new work process.
“We decided to use AWP on a Houston crude unit project,” Jones explained. “In order to roll this type of program out, we collaborated with the constructors who were going to do it. We acted as the general contractor on this specific job, and we had our constructors come in and talk about this. The concept here is to develop these work packages in small pieces and manageable bites the constructors help roll out. The packages are done well in advance of starting the project and field construction. As an owner, this forces you to get your constructors on board earlier instead of later.”
Jones also recommended having engineering representatives involved in the AWP meetings because of the engineering deliverables required to perform the work.
“The advanced workface planners and packagers make sure all materials are on-site,” Jones said. “They locate the materials and stage them. What you don’t want are foremen looking for materials or waiting on scaffold. Ideally, you just want them to do the work, and everything else is done ahead of time. My analogy for this is a cooking show. All the ingredients are there and measured. The work is done ahead of time.
“The ultimate objective is you’re going to do more work upfront to reduce time in the field. At the end of the day, if things don’t arrive on schedule and engineering quality is suspect, the field can’t catch up. Project certainty is key, and that’s what the owner wants.”
According to Jones, this new process seemed to be embraced by those on the jobsite even though these individuals were the “guinea pigs” of Valero.
Valero has also been purchasing refineries and assets for a number of years. With different refineries in different locations, they all come to Valero with their heritage standards and preferences on how to operate. According to Jones, Valero had to tackle standardization in its refineries.
“Valero made the decision it was going to standardize its engineering practices,” Jones said. “We did this, and it was not painless because each refinery has its preferences. But by and large, when you do standardize — although painful in the beginning — in the long run it helps predictability outcomes. Also, standardization helps when you’re using a nested group of contractors or engineering companies because they know your expectations, and it helps reduce that learning curve going forward.”
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