 "Petrochemical plant image via Shutterstock.")
Optimisation is no longer an option. It is now a commercial necessity. The fluctuating marketplace for feedstock and energy prices means that the competitive advantage for refining, petrochemical and chemical production is being squeezed. Many companies can no longer rely on cost advantage, so there is little room for error.
For industry leaders today, the imperative is to meet customer needs and be commercially profitable. Before they can achieve this goal, firms have many business challenges to overcome, including optimising complex operations, efficiently designing facilities to provide greater energy and capital cost savings, and maximising manufacturing effectiveness through efficient supply chain management. To conquer complexity and drive efficiency measures across the operation, companies today are implementing flexible technology to achieve design and production optimisation.
A fluctuating marketplace
The refining and petrochemical industry has reached a turning point due to global changes in feedstock availability and price, which has created a more challenging market. Companies will need to excel in their pursuit of commercial and operating excellence in order to remain competitive and preserve global market share.
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Many projects are in the process of being constructed and commissioned, like in Asia and the Middle East. This presents ‘growing pains’ to operators as these new operations supplement the current operating facilities. Each new operational process must be designed to be both safe and reliable. In addition, the industry continues to suffer from a shortage of skilled and experienced engineers across all areas of the business.
Feedstock and product prices have fluctuated dramatically in recent times and consequently affected supply and demand. With global competition and regional imbalances, the need to implement more stringent safety and environmental regulations is equally essential for companies to mitigate risk against unplanned events. The potential effect of this on the producers is significant as margins are reduced and new production capacity shifts to embrace new feedstock sources. The US shale gas/shale oil industry is already putting tremendous pressure on operators across the markets as some regions are now caught in between cheap chemical imports from the US and the Middle East.
Best practice
In today’s market, it is vital to squeeze as much value as possible from the operation where costs and risks are high. In order to deliver this, companies need to adopt best practice using integrated software to achieve superior cost results, including the following key disciplines:
Commercial excellence: Companies are focused on creating integrated plants that are world-class in both size and complexity. There is a need to work hard to establish what to produce, how or when to ramp up production, where to sell products, how to distribute it and quickly determine the return on investment. By standardising on optimisation software, companies will improve margins, increase yields, meet customer demand and gain competitive advantage.
Operational excellence: To survive in this fast-changing environment, companies need to be leaner, more efficient and able to adapt quickly to customer needs. To be exemplary in terms of operational excellence, companies are implementing flexible and integrated software technology to bridge the gap between strategic planning and scheduling. Using integrated software to avoid silo practices will help empower engineers to make better decisions when they come to address feedstock planning, operational efficiency, energy optimisation and safety analysis. The use of advanced process control (APC) achieves greater control over plant to meet operational and energy efficiency targets, as well as improve product quality.
CAPEX efficiency: Together with better analysis, the ability to easily evaluate capital investment projects faster early in design process along with better analysis helps engineers understand the economic implications of decisions. Crucially, the project scalability, improved workflow and the ability to achieve better predictability and accuracy during FEED (front-end engineering & design) reduces the total project life-cycle. With better cost trade-offs in making incremental capital investment decisions, companies will become more profitable.
Compliance and sustainability: Efficient design of facilities is vital to achieve outstanding environmental, health & safety (EHS) performance and reduce operational risk and prevent injury to staff. Excellence in process safety starts by ensuring facilities are designed, operated and maintained in a way that minimises the potential for process safety incidents. Risk is also managed by quickly identifying hazards, assessing consequences and implementing prevention and mitigation measures.
Skills development: Companies are focused on addressing a shortage of skilled and experienced chemical engineers. With integrated software, new and occasional users become proficient faster and experienced users can do more.
It is a combination of these elements that industry needs to undertake to respond effectively to the commercial and operational issues affecting their business. The use of integrated automated software, in particular, delivers accurate real-time information and significantly helps operational decision-making be more efficient with less resources and time to complete tasks. Sustainability is, therefore, enhanced through more efficient use of energy and less raw materials wastage, whilst quality is improved. Cutting-edge software streamlines workflow and manages orders more effectively to be on time and measurably meet customer satisfaction requirements.
Manufacturers who standardise on optimisation software across the enterprise will minimise lead times, maximise asset utilisation, speed up time-to-market, increase production visibility and strengthen competitiveness.
The model for success
Navigating uncertainty is essential in today’s market. Those companies who will thrive must be leaner, efficient and able to adapt quickly to market dynamics. To remain competitive, utilising innovative and flexible technology will significantly improve profit margins. Better integrated planning, scheduling and execution also optimises the manufacturing operations and supply chain. The avoidance of silo practices with integrated software will help empower indigenous engineers to be better decision-makers for addressing feedstock planning, operational efficiency, energy optimisation and safety analysis.
As economic storm clouds continue to threaten, standardising on optimisation software allows business to achieve commercial competitiveness and operational excellence, which will substantially contribute to conquering complexity and driving efficiency in a turbulent marketplace.
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Dr Filipe Soares-Pinto is senior VP Asia Pacific Sales at AspenTech
