Surmont Condensate Blending Facility
ConocoPhillips Canada (CPC) is the Canadian division of one of the world’s largest independent exploration and production companies. In Alberta, a new strategy for developing the world-class Surmont oil sands project in northeast Alberta is to blend bitumen with condensate to produce a commercial Synbit product. Delivering on this strategy entailed building an alternate (condensate) blending facility within the Surmont In-Situ Oil Sands plant. A corporate commitment was made in late 2017 to start production with condensate in Q4 2019. The challenge and the opportunity were thus established for the construction team: deliver a complex, brownfield, schedule-driven project of about 250,000 person-hours to enable the condensate blending strategy. Engineering was to kick off in January 2018, with full funding approval anticipated in June 2018 (actual October 2018) and handover to operations in November 2019.
The team brainstormed activities that could be safely executed with minimum engineering risk and minimum project risk by overdesigning instead of fully optimizing. This allowed construction activities to start with thirty percent engineering complete, without jeopardizing budget. The target was to have construction sixty percent complete prior to the 2019 Plant Shutdown (i.e. approximately 150,000 of the original 250,000 estimated person hours). In order to achieve this, significant collaboration and trust between CPC and the contractor were essential as construction work was initiated:
- Use engineer-stamped sketches instead of formal drawings
- Accept non-optimized piping routes – for example a new pipe rack level had to be created
- Focus on partial modularization instead of full modularization in order to open multiple work fronts in the field
- Maximize the amount of modularization (even at the expense of unit cost) to optimize resource utilization (e.g. bridges and PSV modules)
In addition to accelerating construction activities, innovation in equipment selection was implemented to maintain schedule:
- Use a fixed tower crane instead of mobile cranes for upper level pipe rack work (reduced mobilization and positioning time, also reduced safety risks during lifts)
- Planning for single-crane lifts (using a 1,200-ton crane) for all modules and equipment to reduce equipment count on site.
During the early planning stages (prior to Authorization for Funding) the team developed a thorough risk assessment to identify all potential derailers and ensure unanticipated costs would not be a showstopper. At the time of funding request, worrisome risks included tariffs on steel, re-work in the field due to accelerated schedule, delays on equipment deliveries, weather challenges and module fabrication schedule. However, by the time of execution three main risks remained to focus on and mitigate:
- Delay in material and equipment deliveries – this was mitigated through expediting, not just from home office, also directly at vendor shops as required.
- Winter construction –the mitigation to maintain high progress during the cold months was to prefabricate in a field shop (controlled environment) as much as possible, limiting work outdoors to final setting of spools, assembled steel, etc.
- Coordination with ongoing plant operations – this was mitigated by having rigorous but streamlined systems in place to reduce time in issuing permits. A dedicated operator was put in place to assist with this coordination.
The project was successfully completed by the committed completion date with the budget contingency left untouched. Although schedule-driven projects can pose execution challenges, success was achieved by thorough preplanning and by intentional alignment between owner and contractor from the outset. Through detailed and constant communication, both internally within the project team and externally to stakeholders, everyone pulled together to ensure the project goals were achieved.
Direct field person-hours (excluding scaffolding) = 279,050 HSE = 0 incidents
Original Budget = $147.6 million Actual cost = $120.0 million
Posted under: Invest in Alberta