When the price of oil was hovering above $100 a barrel, many plants in the oil and gas industry had the luxury of reacting to maintenance and reliability issues only when they became critical. However, the past two years have seen a dramatic fall in the price of oil, and the price is expected to remain down at $50-$60 a barrel for at least the next two years. Companies have responded to this drop in price with cutbacks and belt-tightening including reductions in personnel. These reductions have made it even harder for facilities already in an inefficient reactive mode to successfully execute their maintenance and repairs. In challenging economic times such as today, best-in-class plants will use three tools to manage costs and reliability: work management, equipment maintenance strategies and root cause analysis.
Work management
During the “fat” times of high oil prices, many companies simply repair equipment after it fails. With the absence of processes and procedures, this seems like the best way to make repairs or manage “work.” Unfortunately, working reactively incurs higher costs, results in lower quality repairs, requires more downtime and causes more safety incidents.
Managing capital, labor and materials is critical in a low oil price economy. Work management (WM) is key to achieving this. WM involves all the activities that occur in the lifecycle of a maintenance work order, starting with the initiation of a work request and following up with work scoping, planning, scheduling and close-out of the work order. The WM process ensures the workforce is deployed efficiently while getting work completed safely and in a timely fashion.
The best plants implement robust WM processes staffed with trained and knowledgeable planners, schedulers and supervisors. Reactive work is typically 3-4 times more expensive than planned work, and sometimes it is as much as 20 times more expensive. Getting the right people at the right time doing the right thing is critical to being efficient and effective.
Equipment maintenance strategies
A maintenance strategy is a philosophy and approach required to maintain an equipment item at the lowest cost and highest reliability while safeguarding integrity. Maintenance strategies can be developed using risk-based approaches, such as reliability- centered maintenance (RCM), or you can start with OEM preventive maintenance recommendations.
There are three types of maintenance strategies: time-based, condition-based and fix-on-failure. A well-designed maintenance strategy will prevent or minimize the consequences of failure. Studies indicate the best companies require all maintainable assets in their plants or facilities have a maintenance strategy. Once in place, maintenance strategies should be reviewed at a minimum of every five years.
Root cause analysis
Root cause analysis (RCA) is a tool for investigating and solving equipment failures and problems. In an asset-intensive plant like a refinery, equipment failures can cost thousands of dollars in repairs and even more when downtime losses are considered. The best companies treat failures as unacceptable, and in some cases, an RCA is performed on all equipment failures.
When plants have downsized due to cost-cutting, it can be difficult to find time to address equipment failures. In these cases, smart managers use the Pareto Principle (the 80/20 rule). This simply means 20 percent of the equipment is causing 80 percent of the problems in the plant. To achieve the biggest impact for the effort, the focus must be on the 20 percent, known as “the critical few.”
Don’t let a lack of automated data be an excuse not to act. Go out and talk with the people who work with the pumps, valves, fans and other equipment. They will tell you where the 20 percent is that needs to be targeted.
Summary
Resist the urge to fall into the trap of a short-term, cost-cutting mentality. Put good maintenance and reliability practices and procedures in place for long-term optimization. The three practices discussed will help to achieve significant cost-savings and operational efficiencies even in these financially trying times.
For more information, visit www.mar shallinstitute.com or call (800) 637-0120
