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Jun-2017

Flexible thinking for capital projects

Conventional project planning and execution may not be the best approach for gas treating and sulphur recovery installations.

MARK DUISTERS
Jacobs Comprimo Sulfur Solutions
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Article Summary
The most common way to execute gas treating and sulphur recovery projects is to follow the project steps as laid out by the major global oil and gas companies. This means that after feasibility and conceptual studies, technology selection and compiling a process design package, the project moves to a FEED contractor and later on to an EPC contractor. The basic line-up of gas treating and sulphur recovery units is pretty well known in the industry which makes it tempting for owners to keep feasibility and conceptual phases extremely short. This approach leaves a lot of available specialist knowledge and insights untapped whilst asking general engineering contractors to go to the market for pricing on equipment items like columns, main burners, mixing chambers, reactors, condensers, and so on.

This article will provide further background and focus on the execution of gas treating and sulphur recovery projects, with a view to comparable projects in other industries including formats like engineering and procurement (EP) and modular delivery. Also, special features of gas treating and sulphur recovery projects are highlighted, including project issues that seem to occur over and over again and how they could be prevented by putting more emphasis on the earliest project phases. This article is written to inspire decision makers to rethink the approach for executing gas treating and sulphur projects.

Project phasing
Among projects in almost all technical and engineering driven industries, from food and pharma to the entertainment industry, refineries, terminals, buildings, governmental infrastructure and automotive, the thing that stands out in the oil and gas industry is the rigid way of following the capital investment work process, mainly developed for mid-size and large refinery projects.

Most owners use project phasing similar to the example shown in Figure 1 to steer their capital investment process.

This concept makes a lot of sense for projects where the exact configuration is yet to be figured out and where combinations of equipment are not part of a standard line-up.

However, in gas treating and sulphur recovery projects, typically the hardware is pretty much similar; the main differences can occur in the smart use of utilities, catalyst and solvents or integration of these systems.

The line-up, determined by the bidders during the bidding phase for the technology, rarely changes during the subsequent phases. The various hardware items have been estimated, bought and built many times before. Therefore a full FEED phase including obtaining price quotations from the market does not make a lot of sense and will hardly add any value compared to estimating information that could be provided by the licensors as a scope item of the technology package.

This way of thinking connects to the way more or less standard units are handled in the chemical industry. Units like a sulphuric acid unit or a regenerative thermal oxidation (RTO) unit are bought as a product rather than a process installation.

A lot of information from previously built installations is available in the licensors’ databases, provided inputs to preparation of the plant owners’ investment plans can be generated very efficiently, and has the benefit of being directly connected to specialists in the specific technology.

Besides the availability of data to support capital estimates, significant quality improvements can also be derived by tapping into the licensor’s knowledge.

Thinking of a sulphur recovery unit (SRU) as a product automatically leads to putting more emphasis on what product to buy. Translating this to the capital investment process highlights another thing that is noticed in other industries: significantly more time and effort is put into the earliest project phase, to make sure the right project is being scoped. In a typical gas treating and sulphur recovery project, the money spent on the phase before EPC execution is less than 1% of the plant’s life cycle cost (see Figure 2). Time spent on tests and studies to determine the right basis for process design is only a fraction of that 1%. In this period, it will be determined what all other parameters in the plant’s lifetime will look like.

Skipping an extra well-test or taking some extra samples may save a little time and money during the definition phase of the project, but the reasoning above makes it clear that assumptions taken instead of those tests or a thorough study will have huge consequences for the use of consumables (including energy) and effectiveness of the installed hardware.

Lessons learned?
Typically, licensors’ specialists are heavily involved in commissioning and start-up of the unit using their process licences. In cases where generic engineering contractors are used for FEED and EPC work, basic mistakes keep occurring, resulting from lack of real understanding of the units. Even when those aspects are clearly spelled out and explained during the PDP phase, the experts at Jacobs Comprimo Sulfur Solutions keep running into typical errors such as:
• Feed gas quantity deviates more than 40% from design basis.
• Feed gas composition deviates substantially from design basis.
• Importance of very low pressure drop not understood, resulting in too long pipe routes and equipment not located correctly.
• Reactor internals seem simple; risk of damaging catalyst not recognised.
• Lines sloping the wrong way, resulting in corrosion issues.
• Connections between reactors and condensers not designed for (very) high temperatures.
• Importance of temperature control is not always understood, resulting in temperature elements mounted the wrong way and/or in the wrong location.
• Not able to deal with complexity of advanced burner control.
• Sample points for proper process monitoring mounted in inaccessible locations.

The cost of increasing the scope of the PDP package to make sure critical elements are embedded in the design at a very early stage is easily compensated by reduced redo in the field.

An extended licensor package can even rule out the need for a FEED phase, saving significant time and money by ruling out a complete tendering sequence.

It almost needs no explanation that when at the moment of commissioning and start-up it turns out that feed gas conditions are significantly different from the design basis, needless capital is wasted and a lot of cost and effort is needed to correct for hasty decisions taken at the early stages of project planning.

Going modular
In cases where the licensor also has capabilities to deliver the whole unit or part of the unit, the thought of buying a product instead of going through all the traditional project execution stages can be taken even further. For smaller units, a packaged unit or modular approach would be the ultimate result of this line of thinking where process guarantees, execution and delivery are all in one place.
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