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Inventory Management Program

TTF Meeting - April 18, 2001 Mike Quesnel - Procurment DRAFT. Inventory Management Program. Program Objectives. Cost effectively reduce inventory levels to reflect Operational Excellence strategy (lowest cost)

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Inventory Management Program

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  1. TTF Meeting - April 18, 2001 Mike Quesnel - Procurment DRAFT Inventory Management Program

  2. Program Objectives • Cost effectively reduce inventory levels to reflect Operational Excellence strategy (lowest cost) • Establish inventory levels consistent with top quartile industry performers (benchmarking) • Eliminate inventory associated with equipment retirements

  3. Purpose of This Presentation • Describe program tactics • Present a forecast of program costs • Identify toll impacts of the program • Present benchmarking information (pending availability) • Generate review and discussion leading to a resolution to proceed with the program

  4. Scenarios • 5 cases considered for material reconciliation and cost recovery • Case 1 - Material reconciled in 1 year, costs recovered in 1 year • Case 2 - Material reconciled in 1 year, costs amortized over 2 years • Case 3 - Material reconciled in 1 year, costs amortized over 4 years • Case 4 - Material reconciled over 2 years, costs amortized over 2 years • Case 5 - Material reconciled over 2 years, costs amortized over 4 years

  5. Recovery Value

  6. Cost Forecast - Summary

  7. Cost Forecast - Case 1

  8. Cost Forecast - Case 2

  9. Cost Forecast - Case 3

  10. Cost Forecast - Case 4

  11. Cost Forecast - Case 5

  12. Toll Impact - Summary

  13. Toll Impact - Case 1

  14. Toll Impact - Case 2

  15. Toll Impact - Case 3

  16. Toll Impact - Case 4

  17. Toll Impact - Case 5

  18. Benchmarking Information • Pending • Based on AGA/SGA profiles supplemented with inventory data

  19. Next Steps • Presentation of benchmarking information • Further review of cost forecast with TTF members as required • Agree on cost recovery mechanism and amortization (if appropriate) • Present resolution to TTF on cost recovery

  20. Raise issue at TTF Present program details Work program details Present recommendations and resolution Resolution vote Program implementation Cost recovery Today (March 6) April TTF meeting April and May May TTF meeting June TTF meeting During 2001 2002 forward Proposed Timeline

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