The Material Take Off (“MTO”) - Table Names MTOH, MTOL Mike Mitchell 3 May 2022 London

Functionality

The MTO can be known as several other terms, Bills of Quantities and Bills of Material (BOM) but
they essentially all do the same job.

Using a document of some kind, list of materials and their quantity on that document are described
with various other codes.

In the case of Oil and Gas, the engineering design is in 3D CAD and this information flows
electronically from the CAD system into the PAM MTO tables.

It will often involve 5,000 – 10,000 “drawings” – actually when printed each drawing shows a section
of a pipe usually with all the connections, valves etc in a “module” of the oil platform or facility. To
fully describe each, whole line therefore needs probably 20 such (related in the naming convention)
drawings as it flows across and up and down in 20 or so module spaces of the facility. These are
often called LINE AREA Isometrics. Because it shows a “line” (like “seawater pumped for the fire
water system) in an area, like the Accommodation Module. At some point that Line has to have a
pipe go down below sea level.

Beforehand the design started, someone in CAD created a material specification that listed all the
permissible, possible materials, components and sizes and their connections legally allowed on this
project. Every material item on the MTO must be “in class”, i.e in this spec. Each drawing (now called
an ISOMETRIC) shows the list of materials and the quantity, 2 of this type of valve, 10m of that type
of pipe etc.

Additionally, each row identifies why it is needed on the drawing – is it needed for construction of
the pipe or is it needed at the time of installation – this code is called the material group.

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Additionally, we are told on the drawing the installation area of the finished pipe – this will
ultimately equate to where we must send the raw materials so they can be made up into this
drawing….and those construction sites could be opposite sides of the world. So we equate the
construction “place” at this point of time to an address code (not knowing who or where it might be
when a contract is bid, won and placed.

The purpose of the PAM MTO is therefore to store all such drawings with their lists.

Because we need 2 of the same valves on this drawing we do not go out and buy those 2 valves….
we want to go out and buy, just once, on all the drawings – so we expect PAM to give us the grand
total of each unique material code – and a subtotal by each address (so we send the right quantity to
each jobsite so they can build their scope.

There is a problem of course – you must buy materials before Engineering have finished the design…
so you must guess…. some of the ISOMETRICS are done, others not started. So, it is a balancing act
to predict an accurate figure to buy – you do not want to undershoot….to buy some more might take
6 months delivery, but to buy too much wastes money.

Various figures are available but “overage”, “surplus” pipe left over when the construction is done is
typically 15-20%.... there are horror stories of much more. When our big projects spend $800M on
pipe that can be a lot of wasted money – IPMS average for BP was 4% advised to be lowest in the
industry.

So, Engineering start by doing a measured, manual best guess MTO based on the Plant and
Instrument Diagrams (P&IDs) – these are the first drawings done on a project and show the
equipment and broadly the connecting pipework. They can be drawn manually of be in a P&ID CAD
system – not yet 3D CAD.

We often call this MTO “PRELIM” – it is the first pass of the MTO and probably only accurate to
+_50% and may only be really big sizes of pipe anyway.

Six months later we may have 3DCAD – advanced in some areas, not started in others….
concentrating on getting the big pipes layout first (12” and above) before little pipes of ½” are ever
added.

In addition, we all know that carbon steel pipe is by and large cheap and plentiful, and you can get it
weeks…. specialist non-corrosion stainless steel, titanium, copper (collectively called “exotics”) can
take 6 months to get – so early 3D of those area/pipes is advantageous.

This 3DCAD MTO is usually called INTER or intermediate.

Then, after another 6 – 12 months, we get another MTO usually called FINAL – and this is where the
accuracy is getting much better….by and large what is drawn is not probably going to change (much).
But it still will not be 100% finished for 2 years.

So, you can see if we choose to store each MTO “Level” (PRELIM, INTER,FINAL) – we actually have a
growing volume of a description of quantities of materials – but duplicated into varying degrees of
accuracy.

We are expecting PAM to be able to make sense of all those dynamics – type of metal, size, area,
stage of engineering design, completeness, amount of engineering change going on etc – and put
forward a quantity of each material (hoping) we only need to go out and buy it once in a big buy – if

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we detect we are now “short” then we need to go buy more (a “top-up”) and hope we can get it
before it is needed to be made at the jobsite.

You also need to appreciate the term contingency. If I had 100 drawings of 1m of the same pipe, do
I go buy 100m of that pipe – no – pipe from the stockist or manufacturer is delivered in random
lengths so some pipe is wasted. As you cut pipe you also lose a lot in the saw cut and preparation
(called the “Green”).

Again, depending on metallurgy (carbon pipe is cheap, exotics are expensive), size, delivery period,
degree of accuracy from Engineering, where the jobsite is (in a shipyard in Europe, or up a mountain
in Borneo?) you go buy “extra”. Depending on all those dynamics it will vary from 5 to 20%, i.e go
buy 110M of pipe. At the end of the job when the surplus is accounted, we will see how well that
was judged.

Think on this, a jobsite stopped because the materials are not there costs $10M or more a day, i.e.
the contractor will make a claim under his contract.

Now, on each ISOMETRIC like the above when it comes to be made it might be 10-20 m “long” (with
bends etc – i.e pretty difficult to handle…but that is not how they make it – the contractor looks for
places where it can be bolted – onto a valve for example…that makes a good line break. So,
sections of the drawing are made in pieces called spools – all welded. In construction, in 1-2 years’
time, at the construction site – someone goes finds all the pre-built spools and “erects” them in
place by bolting them ate their valves etc (and that is when we need to bolt – not when the pipe was
welded probably off-site at a spool fabrication facility a year or more earlier).

On some IPMS projects, we had variances of the PRELIM, INTER, FINAL levels of take-off and we also
stored all the NEW drawings – one for each spool in the MTO – and we could workplan the spool
level as well as the higher level – remember thy are really the same thing just at different levels of
detail.

So…. judging the MTO and how much to buy is a combination of knowing lots of facts, detail,
experience and judgement and can make the difference of doing a good job or losing $200 million on
a big job. In terms of priorities though that is maybe only 20 days lateness…..so often clients err on
the side of buying too much to avoid those claims – it is cheaper to waste.

So…. get familiar with

Line Area Isometric

Levels of Take Off

Contingency

Spools

Material Group

Exotics

Surplus

999 (see below)

There is no need for the PAM Revision Table concept for MTO although revision is an available,
overwrite attribute on the Header.

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The MTO is the basis of knowing what bulk material quantities you must go buy. Equipment (of
which is unique and therefore quantity of one is usually not put in the MTO – it is listed in the
Master Equipment List (which in PAM is part of the Catalog).

The MTO is overwhelmingly pipework, but it can contain anything from the Catalog where you want
to link quantities to a place, maybe light fittings – all the same but by room/area/module etc.

So back to PAM….

Precursor

Nothing other than valid material codes entered into the Catalog.

Successor

The Requisition (“REQ”) – this is a document that for the first time assembles list of materials with a
quantity seeking approval to go buy this from the competitive marketplace. To actually go get those
prices and delivery though uses the PAM RFX or Request for Quotation.

The REQ is an internal document which usually requires lots of inhouse approvals to proceed – the
RFX is the external document getting prices from 6 companies and is approved by the Materials
Manager only.

Post Update

PAM has a Material Summary table (“SUM”) – we need to discuss if update to this table is on-
demand, batch scheduled or dynamic…. because of update to the MTO we expect that the SUM
table is ready and wating. The LICOP (Line Item Copy Over Process) from the REQ reads the SUM
table counts – by each table type “MTO”, material, grand total, level, address total and adds rows
into the REQ Line Items showing the total quantity required.

The MTO shows the exact, final installed location for each component/metre of pipe…..but just as
we do not want to just go buy 2 valves (we want to buy all the valves in one go and deliver after
inspection to all those different places) ….so….here we do not buy by address normally.

Some Construction Managers want us too…they want to put a finger on a REQ and PO (“BUY”) and
say that is mine – and are not satisfied with us saying your 20 valves are in this 200 – and we promise
the first 20 that get pass inspection will be yours…. they want THEIR valves separately identified. But
usually we can get past that – and buy all the valves and pipe for the whole project in one go – for all
addresses – in which case the REQ will say Address = 999. When we have bought it and inspected it
we start changing that 200 into a subline for 20 and shipping them to Site X where that Construction
Manager was angry - and leaving 180 still at 999.

Way up at the other end of PAM in the Warehouse is the Warehouse Request (“RQS”) and
Warehouse Issue (“ISS”)– and you issue materials from the warehouse by nominated MTO drawing.
That way you know what has been issued and cannot over issue. In that process, update from the
Request and Issue comes and updates the MTO Line Item (nominated level like FINAL) and we can
see from those figures what has been spooled or not – i.e 10m pipe requested, 10 Requested but
not yet Issued….yes….now Issued all 10.

If only 5m was issued against that 10…. eventually…we need to put that into the PAM workplanning
module (“WPL”) that this MTO still needs balance of 5m.

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Catalog

In PAM I contend we do not need to do a lot validating the Material Code and the Material
Specification. In our PAM World, we should be using the material code as defined by the CAD group
already…not creating another scheme and xref (too expensive manpower etc). So, I am suggesting
that we take the CAD “Catalog” as gospel – that list of codes and material they use already IS our
Bulk material Catalog,

The Catalog needs to be uploaded/synchronised/maintained with that CAD equivalent – and then
we do not have to spend a lot of energy re-validating it.

Equally, there is provision in PAM to store the CAD Material Specification – another upload,

This says that Carbon Steel Spec C03 for 600lb pressure pipe and fittings has a valid list of material
codes and sizes – and only those may be used.

PAM can double check (as IPMS did) that every use of every material on the MTO Line Item was valid
on the Catalog and for that Material Specification but in all my years it was never wrong – even “out
of spec” items (like wanting a 1,200ib pressure item) on Spec C03 was put in C03 !

Who Does all this

Material Controllers

Structure

In PAM, the MTO function is the use of the standard Header and Line Item tables – rebadged in
attribute names as per standard.

Primary Key

Standard Header and Line Item primary key – but here on the MTO the MTO Level joins the primary
key.

Foreign Keys

Yes – lots – all Code Spec at this point – we can discuss whether the “Document” used on the MTO
Header (i.e the ISOMETRIC) should be validated form the Document Register – or be automatically
added to the Document register if not found. IPMS projects did both ways.

The material must be not VOID or CANCEL on the Catalog.

Data History

Material Controllers like to take snapshots of the data and archive. PAM will have such a facility
(“FRZ”) which is effectively a copy of the table now stored under a date/time…. end month or in
advance of major change to the MTO by a new incoming interface.

It is usual that when the MTO is loaded by interface there is no manual update at all.

PAM should have a feature I have tried to discuss called attribute history – so that any change on a
nominated attribute – like required qty on the MTO Line Item – captures what is was/is now, when it
changed and who did it.

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Interfacing

Who knows what where the MTO is coming from – PDMS, PDS, AutoCAD, an Engineer’s Excel???

We will never know – which is why PAM needs a cheap/free flexible etl tool.

As we have discussed we believe this should be managed…date/success/error codes etc eventually –

but in the first instance I think we should have a landing page/table – no validation other than data
type/size. And then a PAM MTO Upload Batch process to validate it all, update/add rows as
required and delete row…leaving bad records and error messages behind for resolution.

Reporting

Extensive and mostly by exception….and truth is, Material Controllers are pretty happy with EXCEL,

MTO sorted by Material Code etc

Attachments

It could be discussed that if there was a requirement to store a BLOB of the actual Isometric it could
be here or on the PAM Document Table.

Given you are up a mountain in Borneo it is nice to click on something and get the latest of actual
drawing (BYTEA in PostgreSQL?) to refer to it.

I am arguing that we should have a URL link to the CAD Original/latest and store that here in the
MTO (on the Header) rather than use the PAM Common Attachments mechanism used on other
tables in PAM (like the actual PO etc).

User Interface Screen

Standard for budibase/PAM – as much of the document I wrote the other day – Logos? Etc etc.

It would be great if we could provide button/links on the screen to the SUM table taking the material
code and address with us for a pre-query on arrival….i,e, looking at a line item – hmm… “how many
do we need in total?”.

Productivity

Let us understand this – one Material Controller on BP ACG Project with IPMS was singly responsible
for that $800 million of piping and valves procurement. It was he (Pete Sanders) that recorded the
lowest BP surplus pipework of just 4%.

None of the data originated in IPMS – it all came from CAD, but IPMS stored it, analysed it,
maintained (a dynamic) Material Summary and that allowed Pete with the LICOP process (IPMS
Automated Requisition Pop-Up) to build all the Requisitions that then flowed to Purchasing – and all
on schedule as was the whole project. That is what we are trying to emulate.

I know we have discussed the EXCEL to Line Items issue the last few days but as said in this
document, since the data is all imported, it is not really needed here. If we have a project faced with
a manual MTO then it is invaluable – but must still be validated. Come hell or high water, building
an import process for the MTO to be used for CAD – AND – manual off-line data from any source
funnels in via the same landing page/table?