FAST-TRACK PRODUCTION PROJECT CUTS INSTALLATION TIME IN HALF

K.J. Vargas
Suncor Inc.
Ft. McMurray, Alta.

Fast tracking of a compressor and pipeline installation at Sylvan Lake, Alta., saved 6 months of project time.

To succeed, fast tracking requires close coordination of all project activities, and ensuring that the shortest possible time be taken on critical activities.

For example, by ordering critical equipment before formal approval and by finding a ready-built compressor, the Sylvan Lake project's duration was cut in half.

ACCELERATING PROJECTS

After discovery or infill wells are drilled, a production department becomes very impatient to get the wells on production. The project engineer/manager is expected to complete well facilities design and construction in record time. Therefore, it is imperative that the project engineer have a plan to get these wells on production quickly.

By using project management techniques, and developing strategies to eliminate or substitute long-lead items, a tie-in project can be executed in half the normal time. All the steps required to accelerate project completion are the same as for a conventional project:

• Project definition

• Preliminary engineering/order major equipment

• Environmental/company approvals

• Detailed design/con-tracts awards

• Construction

• Commissioning, start-up.

Accelerated execution is achieved by obtaining informal approval of the well tie-in project. (If the well can produce at high rates, or loss of production is involved, this is easy to obtain.) Once approval is received, the project engineer makes up a preliminary schedule and proceeds to execute the critical tasks on the schedule.

Normally, the important tasks involve:

• Making a piping and instrument drawing (P&ID)

• Preparing an equipment layout drawing

• Selecting and ordering long lead equipment

• Obtaining environmental approvals.

When the project engineer has a large pool of resources at his disposal (as in a large corporation), he should delegate as many of the initial critical tasks as possible to company personnel he knows will give them high priority. After all critical tasks are taken care of, the project engineer can proceed with the formal project steps such as, approvals (environmental, company), full scheduling, and project monitoring.

To illustrate the benefits of fast-tracking, two similar projects were compared. One was a normal project, the other was fast tracked. The fast-tracked project was less expensive and completed in half the time.

TRADITIONAL STRUCTURE

Traditionally, most companies have performed well tie-in projects by means of a project engineering group or by assigning it to production field personnel. The field personnel do not have the time to ensure all engineering is performed, so they delegate major tasks to contractors or consultants. The project engineering groups have "set" bureaucratic procedures to handle projects, and fast well tie-ins are handled in a similar fashion.

Both of these alternatives give poor results. To fast track tie-ins, it is required to have a project engineer that works for production but reports to central engineering. The project engineer can then draw on central engineering resources, but he has the autonomy to accelerate project completion.

Techniques are available to get well tie-ins performed as quickly as possible without sacrificing safety or engineering standards. The entire process is illustrated by an actual well tie-in project that was put on-line in record time.

FAST-TRACK PROJECT

To execute well tie-ins quickly, personnel must be kept to a minimum, and the project engineer must perform most mechanical engineering and project management roles. This means the project engineer performs all project coordination management (cost control, schedule adherence, and planning) and designs the mechanical systems such as process-design flow sheets, P&ID's and piping drawings.

Because well tie-in projects tend to be in the $0.5-4 million (Canadian) range, the project engineer can manage the project management and mechanical design functions. For fast tracking a project effectively, the project engineer must possess a high degree of experience in selecting critical items and giving them his attention as required. The support supervisory personnel that the project engineer typically will require for the tie-in design and execution will be:

• One environmental specialist to obtain government and environmental approvals quickly.

• Two senior mechanical draftsmen to prepare all process and instrument drawings, piping drawings, and layout drawings.

• One electrical instrumentation engineering consultant to specify instrumentation and electrical equipment; to design panels, instrument loops, and electrical installations; and to monitor installation and commissioning.

• One foundations/structural engineering consultant to perform soil testing and design equipment foundations.

• One rotating equipment specialist to coordinate compression facilities if the facilities are very large or complex.

• One construction supervisor to oversee the project if the site is at a remote location and the project engineer cannot be at the site when construction commences.

Note that only key project personnel have been identified. If the well being tied-in is complex or special, additional disciplines may be required.

PROJECT DEFINITION

The project definition involves the following:

• Obtain the well design parameters from the completions and production personnel. These parameters include effluent analysis (gas, liquid, water), well geographical location, access and potential tie-in points, available utilities (electricity, water, process and instrument air, and fuel gas), and design throughputs, such as production decline profile and conditions for design and economic evaluation.

• Assemble preliminary costs for the total project (- 30%).

• Perform an economic analysis of the tie-in facilities vs. the monetary compensation from selling the oil or gas. The main indicators required to get preliminary management approval are the discounted cash flow rate of return, payout, and net present value (NPV).

• Assemble the environmental application forms and special requirements.

• Obtain preliminary management approval so that the key equipment can be ordered and the design started.

• Select the project tie-in team such as: foundations, electrical/instrumentation as discussed before.

After this is completed, a document can be produced that outlines the scope of the project and what the design solution should be. This document is presented to the production management to obtain approval to proceed with preliminary engineering.

PRELIMINARY ENGINEERING

Preliminary engineering involves getting three complete sets of drawings. The piping and instrument drawings, the process flow sheet with the mass and energy balance, and the equipment layouts. Once these sets of drawings are complete, four vital project items follow:

1. Environmental submission documents are filled out for government approval.

2. Formal company approval documents are completed and submitted (based on a detailed cost estimate from the P&ID/layout drawings).

3. All equipment not already specified at the project definition stage is ordered. The P&ID and layout drawings list all equipment valves and some piping that can be ordered.

4. A detailed schedule is assembled and the detailed design started.

DETAILED DESIGN

The detailed design segment of the well facilities comprises designing the components within each of the engineering disciplines required. Most well tie-in projects include similar components.

Structural and foundation designs must be completed for all equipment and access to the well. This includes site soil testing, equipment foundations design, and access landscaping.

The pipeline design includes bids and award of pipeline construction.

Detailed design is needed for the facility's mechanical components and interconnecting piping. The piping drawings should itemize a materials list. All remaining materials can now be ordered. The detailed electrical and instrumentation design should include all electrical and instrumentation drawings and corresponding materials lists.

Concurrent with all of the above, construction contracts can be tendered and awarded. Also, key component deliveries are monitored and expedited.

CONSTRUCTION

The construction phase is the payoff. This is when the fast-tracking activities are put together and executed. Construction of the facilities will never proceed as per the plan, hence the plan must be constantly updated to keep all construction participants "on-side."

Materials suppliers have to be available to expedite extra materials on-site as required (i.e., fittings and valves not in original design). Frequent construction coordination meetings (1-2 times a week) should be held to avert construction delays and keep the tasks on schedule.

COMMISSIONING

The fast tracking tie-in is not complete until the well is producing. Hence, effort must be expended in planning the start-up. Key trades required for start-up must be available for equipment troubleshooting.

FAST-TRACKING EXAMPLE

The techniques described previously are illustrated by a project to augment solution-gas handling capacity and debottlenecking gas production.

BATTERY EXPANSION

During the month of February 1989, oil and gas production at the Craig Sylvan Lake battery, operated by Gulf Canada Resources Ltd., was being constrained. The battery is the focal point for production from 6 to 8 oil wells and 2 gas wells. Fig. 1 shows the general layout of the Craig battery.

Two existing (No.'s 7-16 and 16-21) and one future (No. 14-18) gas well could produce 15-25 MMscfd. At that time, gas wells flowed into a 4-in. diameter line. From a junction to the south, the gas went into a 4-in. Amoco line and traveled north to the Amoco plant. This 4-in. line was limiting gas production (5 MMscfd extra could be produced by installing a larger diameter line).

Both gas wells could be produced into the Craig battery. The oil wells in the area were also producing into the Craig battery. Solution gas was sent to the Amoco plant via a 4-in. line at 70 psig.

Oil production was being curtailed because Amoco was short on compression capacity and the solution-gas line to the plant had a larger pressure drop. Consequently, all treaters and holding tanks were operating at or above design pressures.

To alleviate the situation, the following was proposed:

• Install a new 8-in. diameter gas line from the Craig battery to the Amoco gas plant. This line would allow unrestricted flowing of high-pressure gas from the gas wells and solution gas.

• Flow both gas wells to Craig battery by cutting the 4 in. line connecting them and directing the flow to the battery. The valve at the junction should be closed.

• Install a solution-gas compressor to handle all Craig battery solution gas and put it into the 8-in. line as suggested above.

PROJECT DEFINITION

The design parameters obtained for the project were:

• Gas analysis to C7+

• Expected increase in oil and gas production as a result of the compressor and new line installation (3 MMscfd more gas production and an extra 600 bbl of oil)

• Existing battery and pipeline drawings and available utilities

• Proposed solution given by the requester.

A 30% cost was developed for the compressor and pipeline installation. Table 1 shows a typical cost breakdown for the project.

To assemble these costs, a simple process flowsheet is required to identify all the extra equipment needed. For example, the solution gas is water saturated, and a dehydration unit is needed prior to going into the pipeline.

To estimate the extent of building and piping requires a knowledge of the area. The site for this particular project was very poor, and extensive soil stripping was required. All piping was run below grade.

From the costs, an economic evaluation of the project can be performed.

Using the above economic summary (Table 2), preliminary approval was obtained from management.

PRELIMINARY DESIGN

After the preliminary approval was obtained, a design team was selected. In this case, the project management and mechanical design were done by the project engineer.

The electrical instrumentation and motor central control (MCC) building design were contracted to a consulting firm. The structural and foundation designs were done by a civil engineering firm.

Drafting was performed by a contract draftsman. The compressor design and construction were handled by the company's rotating equipment specialist.

The team concept was very effective and was utilized throughout the project fast tracking.

Concurrent to selecting the design team formal company approval was completed, environmental documents were submitted (informal approval obtained), pipeline and compressor were sized/designed, process flowsheet, P&ID and layout drawings were prepared, and major equipment was ordered.

Equipment ordered or modified included: 2.5 miles of buried pipeline, compressor/driver skid, dehydration unit modifications, flare header construction, and special valves with long deliveries.

Because the compressor/driver skid was the longest delivery item, a previously built unit was located.

Site-survey/preliminary structural design and a detailed schedule were also prepared.

Fig. 2 illustrates a process flowsheet and mass balance. Fig. 3 shows a detailed project schedule. In Fig. 4, a piping and instrument drawing shows that the most efficient and quick way to establish a design basis for this project was to use a process simulation package such as Hyprotech's Hysim.

The output of this program gives energy and mass balances for the process such as in Fig. 2.

Locating an existing compressor saved the project 3-4 months. The tenacity of the company rotating-equipment specialist made this possible.

DETAILED DESIGN

Detailed design flows naturally out of the preliminary design stage. There are no set boundaries. Hence, in this project, the structural and foundations design was performed while formal company approval and preliminary design drawings were being prepared.

The detailed design phase produced the following tangible results:

• Full structural and foundations drawings, including pipe supports, etc.

• All Facility piping drawings with materials lists

• All electrical/instrumentation drawings

• MCC building drawings and bid documents

• All pipeline drawings and materials lists with bid documents.

From the above, major construction contracts were awarded.

The pipeline and MCC building construction were tendered for bids. The other construction was given to qualified (recommended by the field personnel) local construction firms.

CONSTRUCTION

Because the project engineer could not supervise the construction, a contract supervisor that had previous experience with the company was hired.

The construction progress was monitored on a daily basis by the construction supervisor and weekly by the project engineer. The project was delayed 1 1/2 months due to poor weather.

Copyright 1991 Oil & Gas Journal. All Rights Reserved.