How automation can reduce energy project cost and risk
As oil demand recovers slowly, many operators have kept significant CAPEX and OPEX projects in a holding pattern. However, as of August, demand had returned to 89% of its pre-COVID level and by the first quarter of 2021, demand may recover to as much as 92-95% compared to pre-COVID levels, according to IHS Markit. As recovery looms, the energy industry is looking for ways to reignite their projects to spur economic recovery – one with efficiency and productivity at its heart. Digital technologies that help automate laborious manual tasks while supporting engineers, suppliers and project managers to be more self-sufficient could offer a wealth of benefits.
Right information, right time
Underpinning the success of any large capital project is ensuring that the right people have the right information at the right time to make informed decisions. Inefficient document control can often be the bottleneck of an otherwise well managed project. In times past, companies would choose between hiring an army of document controllers to ease congestion or throwing millions of dollars at a custom management system to smooth the crunch.
Now, with years of engineering management software experience under the industry’s belt, out-of-the-box workflows that have distilled those development learnings and built in best practice at the same time can be obtained for an affordable price. That’s a big leap given the thousands of craft days and millions of pounds lost to rework due to poor document control every year. However, with COVID-19 continuing to exert pressure on both human resources and project costs, digital transformation can offer a means for industry to manage costs more tightly and improve the quality of work while reducing risk.
Automated document control
It’s an age-old problem. Despite the technological advances that have it made possible for teams to connect and collaborate while working remotely, document controllers are still spending hours of their day chasing up engineering reviews and hunting down documents that have seemingly vanished into thin air. But what if automation could implement a self-service system that automates control over the distribution of the hundreds of thousands of engineering documents that are created, revised and circulated on any one project.
As an example, through automation engineers can send their own reviews and the supply chain can submit RFIs without needing the expertise of a document controller. A digital distribution matrix will innately know who needs to be involved in the review or RFI, calculate deadlines and send reminders for open tasks to avert missed deadlines. Instead of the review being sat in a document controller’s inbox waiting to be forwarded, it lands directly in the inbox of the person that can review the document or help answer the questions. It sounds simple but we’ve seen examples where the turnaround for a request for information has come down from seven days to three, because the process of getting it to the right people, and back again, was entirely automated.
In a similar vein, circulating the right revisions to suppliers is a particular pain point on many projects. Send too many updates to a fabricator and you’ll incur a big bill, send too few and you risk paying for rework. Again, the system can do the work by automating the transmittal of only the documents needed by the suppliers as soon as they are revised. This significantly reduces the engineering document control overhead associated with keeping constant tabs on who has received what, along with reducing the risk and cost of rework due to out of date content.
COVID-19 is also accelerating the move away from paper copies by digitalising the binder and delivering paper as a PDF direct to engineers’ devices instead. Delivery can be tailored so that workers only receive the documents most relevant to their work package. For those project managers still using hard copy binders, automation can offer a helping hand by highlighting which copies have changed since the binder was last updated.
Streamlining a project’s future
On a large greenfield project, the capture of engineering tags for supplier documentation is another laborious manual task. It’s an inefficient process that takes engineers away from their core competency of, well, engineering things. It’s not a simple fix either; a large project might have 50,000 vendor documents where manual extraction would take thousands of days. Not capturing this data and making it part of the information handover may save time on the project, but this is a false economy that results in an even greater cost in downstream operations.
Thankfully, the industry is increasingly moving towards mandating tag to document data as part of handover, helping to deliver time and cost savings well into the future. Making use of an automated extraction engine and tag centric viewer can reduce the time needed to extract and validate tags by 80% and the time it takes will only decrease as machine learning and natural language processing techniques improve. This turns what could have been a potential project threat and source of client frustration, into a competitive advantage. In addition, automation is also helping the industry to move to better standardisation for the handover of information by improving compliance as well as through the standardisation of processes and tools.
COVID-19 has incentivised most energy companies to take stock, with some left considering whether accepting schedule delays and budget overruns can continue particularly in the face of growing pressure to combat climate change. Automation can make an enormous difference at every stage of an energy project - driving efficiency, reducing costs and rework and improving schedule adherence while supporting staff in their respective roles. Applied appropriately, digital technologies can be the cornerstone of the energy industry’s economic recovery.
Carbon dioxide removal revenues worth £2bn a year by 2030
Carbon dioxide removal revenues could reach £2bn a year by 2030 in the UK with costs per megatonne totalling up to £400 million, according to the National Infrastructure Commission.
Engineered greenhouse gas removals will become "a major new infrastructure sector" in the coming decades - although costs are uncertain given removal technologies are in their infancy - and revenues could match that of the UK’s water sector by 2050. The Commission’s analysis suggests engineered removals technologies need to have capacity to remove five to ten megatonnes of carbon dioxide no later than 2030, and between 40 and 100 megatonnes by 2050.
The Commission states technologies fit into two categories: extracting carbon dioxide directly out of the air; and bioenergy with carbon capture technology – processing biomass to recapture carbon dioxide absorbed as the fuel grew. In both cases, the captured CO2 is then stored permanently out of the atmosphere, typically under the seabed.
The report sets out how the engineered removal and storage of carbon dioxide offers the most realistic way to mitigate the final slice of emissions expected to remain by the 2040s from sources that don’t currently have a decarbonisation solution, like aviation and agriculture.
It stresses that the potential of these technologies is “not an excuse to delay necessary action elsewhere” and cannot replace efforts to reduce emissions from sectors like road transport or power, where removals would be a more expensive alternative.
The critical role these technologies will play in meeting climate targets means government must rapidly kick start the sector so that it becomes viable by the 2030s, according to the report, which was commissioned by government in November 2020.
Early movement by the UK to develop the expertise and capacity in greenhouse gas removal technologies could create a comparative advantage, with the prospect of other countries needing to procure the knowledge and skills the UK develops.
The Commission recommends that government should support the development of this new sector in the short term with policies that drive delivery of these technologies and create demand through obligations on polluting industries, which will over time enable a competitive market to develop. Robust independent regulation must also be put in place from the start to help build public and investor confidence.
While the burden of these costs could be shared by different parts of industries required to pay for removals or in part shared with government, the report acknowledges that, over the longer term, the aim should be to have polluting sectors pay for removals they need to reach carbon targets.
Polluting industries are likely to pass a proportion of the costs onto consumers. While those with bigger household expenditures will pay more than those on lower incomes, the report underlines that government will need to identify ways of protecting vulnerable consumers and to decide where in relevant industry supply chains the costs should fall.
Chair of the National Infrastructure Commission, Sir John Armitt, said taking steps to clean our air is something we’re going to have to get used to, just as we already manage our wastewater and household refuse.
"While engineered removals will not be everyone’s favourite device in the toolkit, they are there for the hardest jobs. And in the overall project of mitigating our impact on the planet for the sake of generations to come, we need every tool we can find," he said.
“But to get close to having the sector operating where and when we need it to, the government needs to get ahead of the game now. The adaptive approach to market building we recommend will create the best environment for emerging technologies to develop quickly and show their worth, avoiding the need for government to pick winners. We know from the dramatic fall in the cost of renewables that this approach works and we must apply the lessons learned to this novel, but necessary, technology.”
The Intergovernmental Panel on Climate Change and International Energy Agency estimate a global capacity for engineered removals of 2,000 to 16,000 megatonnes of carbon dioxide each year by 2050 will be needed in order to meet global reduction targets.
Yesterday Summit Carbon Solutions received "a strategic investment" from John Deere to advance a major CCUS project (click here). The project will accelerate decarbonisation efforts across the agriculture industry by enabling the production of low carbon ethanol, resulting in the production of more sustainable food, feed, and fuel. Summit Carbon Solutions has partnered with 31 biorefineries across the Midwest United States to capture and permanently sequester their CO2 emissions.
Cory Reed, President, Agriculture & Turf Division of John Deere, said: "Carbon neutral ethanol would have a positive impact on the environment and bolster the long-term sustainability of the agriculture industry. The work Summit Carbon Solutions is doing will be critical in delivering on these goals."
McKinsey highlights a number of CCUS methods which can drive CO2 to net zero:
- Today’s leader: Enhanced oil recovery Among CO2 uses by industry, enhanced oil recovery leads the field. It accounts for around 90 percent of all CO2 usage today
- Cementing in CO2 for the ages New processes could lock up CO2 permanently in concrete, “storing” CO2 in buildings, sidewalks, or anywhere else concrete is used
- Carbon neutral fuel for jets Technically, CO2 could be used to create virtually any type of fuel. Through a chemical reaction, CO2 captured from industry can be combined with hydrogen to create synthetic gasoline, jet fuel, and diesel
- Capturing CO2 from ambient air - anywhere Direct air capture (DAC) could push CO2 emissions into negative territory in a big way
- The biomass-energy cycle: CO2 neutral or even negative Bioenergy with carbon capture and storage relies on nature to remove CO2 from the atmosphere for use elsewhere