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Select Methodology: Adding Value in the Front-end for the Long-term. Delivering Value through Experience. Vince Vetter, INTECSEA. Offshore Technology Conference, Houston │ 6-9 May 2013. Project Phase Diagram. What is Select ?.

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select methodology adding value in the front end for the long term

Select Methodology: Adding Value in the Front-end for the Long-term

Delivering Value through Experience

Vince Vetter, INTECSEA

Offshore Technology Conference, Houston │ 6-9 May 2013

what is select
What is Select?

Select is a specialist division of WorleyParsons focused on project viability assessment and selection. We recognize that decisions made during the early stages of an investment have the greatest impact on the ultimate business outcome.

what is select1
What is Select?

The Select phase:

  • Adds technical definition, thus reducing technical risk
  • Optimizes opportunity and maximizes the inherent value
  • Creates the business case
  • Assesses the probable costs
  • Secures the necessary approvals
  • Prepares for the Deliver phase
maximizing value to our customers
Maximizing Value to our Customers
  • Phases 1 and 2 (Identify and Evaluate) are the value adding phases. It is these phases that provide the opportunity to find the up-side of the development case
  • The objective is simple – to maximize NPV at acceptable risk
decisions
Decisions
  • Every project needs to make BIG decisions
    • Is the project viable?
    • What is the optimum development concept?
  • Selectfocuses on making good decisions
    • By breaking the big decisions into small, discrete decisions
    • By focussing on what is important to make these decisions
    • By identifying and understanding the key project risks
concept decisions
Concept Decisions
  • Standard toolkit for concept phase work
  • Standard Select methodology
  • Broad portfolio of representative projects
  • Experienced personnel
    • Facilitators
    • Study managers
    • Engineers
  • Dedicated part of the organization
    • Specializing in concept phase work
  • Current market knowledge for the full project life cycle
    • Costs
    • Capabilities
    • Capacities
the select toolkit
The Select Toolkit
  • Framing Workshop
  • SelectDraw
  • SeleXpress
  • SeleGo
  • Selector
  • SelectPronto
  • Select NES
  • SelEconomics
  • Select Risk
the select toolkit1
The Select Toolkit
  • Framing Workshop
  • SelectDraw
  • SeleXpress
  • SeleGo
  • Selector
  • SelectPronto
  • Select NES
  • SelEconomics
  • Select Risk
framing the study
Framing the Study
  • Framing needs to identify:
    • Project Opportunity
    • Key Success Factors/ Desired Outcomes - "We will know we have been successful if …"
    • Frame for opportunity – what will be considered, what won’t be considered
    • Key constraints
    • Major stakeholders
    • What decisions are being answered now, what will be answered later
slide13

“Suddenly, a heated exchange took place between the king and the moat contractor…”

Gary Larson, The Farside

the select toolkit2
The Select Toolkit
  • Framing Workshop
  • SelectDraw
  • SeleXpress
  • SeleGo
  • Selector
  • SelectPronto
  • Select NES
  • SelEconomics
  • Select Risk
sele xpress
SeleXpress
  • SeleXpressis an SQL based tool for process engineers to use to quickly size equipment required for a Select style project
  • SeleXpressis linked to HYSYS and therefore requires a HYSYS model to be produced prior to running the program

SeleXpress

  • EQUIPMENT SIZING
  • EQUIPMENT LIST
  • EQUIPMENT WEIGHTS
  • LOAD LIST
  • GHG EMISSIONS

HYSYS

MODEL

the select toolkit3
The Select Toolkit
  • Framing Workshop
  • SelectDraw
  • SeleXpress
  • SeleGo
  • Selector
  • SelectPronto
  • Select NES
  • SelEconomics
  • Select Risk
selector
Selector?
  • Case evaluation is best performed with Building Blocks
    • Provide consistency in the estimate
    • Provide efficiency in generating multiple case estimates
    • Provide clarity in the basis and cost for each building block
    • Provide flexibility for evaluating alternatives and what-ifs
  • Selectoris a cost compilation tool for compiling the estimates from a series of estimate Building Blocks
  • It is not an estimating package – but produces cost estimates
  • Quite often have a large number of Cases that need to be compared to evaluate the development alternatives – so want a tool that speeds up cost compilation, and enables evaluation of cases
what makes a case
What Makes a Case?
  • Facilities that are to be installed
    • Production capacity
    • Layout, wells, export location etc
    • Sizes of items (eg flowlines, topsides, jackets etc)
    • Materials
    • How are they installed
    • Where are they built
  • When they are to be installed (ie campaigns)
  • Contracting strategy
  • % of Customer ownership
  • Different production profiles
select or methodology
Selector Methodology

Indirect, Allowances and Contingency

As agreed with Customer

Direct cost building blocks

Master File

Imports BB’s

Adds Indirects, Allowances and Contingency

By BB

Reports

Compare cases

Design to input to NPV or clients financial tool

Case Generation

Add as many of each BB as required in each campaign to create cases

the select toolkit4
The Select Toolkit
  • Framing Workshop
  • SelectDraw
  • SeleXpress
  • SeleGo
  • Selector
  • SelectPronto
  • Select NES
  • SelEconomics
  • Select Risk
select nes
SelectNES
  • The non-economic Screening Workshop is carried out to focus on differentiators between options
  • Differentiators
    • Items that identify a risk or issue to be resolved for a particular option
    • A differentiator should be a risk or issue that the project team can address and affect an outcome, or an item that requires further work to be able to address
select nes1
SelectNES

Normalised overall comparison chart – scores inverted to show positives

Maximum score achievable in any category is 1

the select toolkit5
The Select Toolkit
  • Framing Workshop
  • SelectDraw
  • SeleXpress
  • SeleGo
  • Selector
  • SelectPronto
  • Select NES
  • SelEconomics
  • Select Risk
economics
EcoNomics™
  • Maximize project outcomes across the asset lifecycle
  • Quantify and monetize relevant environmental, social and economic project factors
  • Embed tools and expertise to turn sustainability objectives into reality
project experience
Project Experience
  • Good concept screening relies on experience with real world solutions and facilities
different environments
Different Environments
  • Harsh
  • Benign
  • Arctic
project examples
Project Examples
  • A customer was struggling to identify a viable development concept for an oil discovery
    • Proven oil development province
    • Numerous analogue developments in the vicinity
    • Concepts were based on look-alike development scenarios
    • Negative project value
  • The customer’s management couldn’t understand why the project wasn’t attractive
    • Project would be cancelled if a positive project value could be established
  • Strategic rethink required
    • Brainstorming workshop
    • Focused on value opportunities that could fundamentally change project value
reference development concept
Reference Development Concept
  • FPSO/subsea development concept
  • Multiple drill centres
  • Paired oil producers/water injectors
outcomes
Outcomes
  • Specific development cases were identified, to conclude:
    • Some oil producer/water injector well pairs were sub-economic and removed from scope
    • Single drill center cost savings offset reduced oil recovery
    • Gas export to domestic market was viable and added considerable value
  • Project is viable and proceeding to next gate
summary
Summary
  • Proven systems
  • Backed-up by world class experience
    • World-wide
    • From minimum to maximum scales
    • Portfolio of proven facilities