Brownfield Project Characterisation R5 With Simpler Charts

Topsides Brownfield Projects
Project Characterisation
Nov 2014
www.assetdev.com
GRP-BMS-PRC-TEM-0001, Rev 01
Contents
 Executive Summary
 Success Criteria
– Short form
 Questionnaire
– Categorisation Definition & Comments
– Page 1 - Characteristics 1 to 9
 Complexity Versus Outcome
– Scatter Diagram
– Success Chart & Trend
 What Characterises the Best 5
 What Characterises the Worst 5
 What is Different & Similar between Best 5 and Worst 5
 The Rules
 Supplemental Data
– BLP Success Chart & Trend
– Module Success Chart & Trend
– Long form Success Criteria
2
Executive Summary
3
Executive Summary
 Brownfield Projects are complex undertakings which are often

characterised by cost and time overruns including some project
cancellations well after significant capital has been sunk. As such
they generate a degree of concern due to their challenges.
 At ADIL we are not intimidated by this challenge. Our
combination of Process, People and Experience can ensure their
successful delivery for you as if they were our own Projects.
"As I have said so  In Brownfield Projects, like all others, the outcome is not “a
many times, God function of chance”, their characteristics are measurable and can
doesn't play dice
with the world” be correlated to success and thus managed. This supports our
belief that Brownfield Projects can be delivered successfully with
Albert Einstein predictable outcomes in the upper quartile.
 Success starts by creating a genuine understanding of the
Organisation, Asset, Opportunity or Project and the Execution
challenges.
From this visceral understanding of Projects & hard won lessons
we have defined our Rules to guide projects and ensure success.
4
Success Criteria
5
Success Criteria – Short Form
Success Dimension Definition

Technical Success Full throughput delivered safely with no harm to
environment soon after start up and no significant releases or
outages in first few years of field life.
Commercial Success Promised economic value from project delivered with no

Definition
significant erosion of value due to schedule overruns or
significant events in first few years of field life.
Schedule Success Project Benefits realised at or around Sanction schedule

expectations.
6
Questionnaire
7
Characteristic Definition & Comments
 All questions are simple Yes or No literally with no interpretation, guessing or part
scores. If desired commentary / substantiation can be included to aid understanding.
 There are 33 Questions or Characteristics.
 1 question is successful delivery which strictly speaking is an output. However, for
completed projects this is a characteristic and for those not yet completed it is an
indication of sense of confidence or belief which again is a characteristic.
 In some cases Yes = 1 and in some cases No = 1 but in all cases 1 = Complexity.
 All items that add complexity make the complexity score higher.
 If Project is Large it is also a Medium and a Small and Medium are also Small so
scoring is weighted for Size of Project. Similarly for Single & Multidimensional Project
 Age of Host is not included as not automatically an issue but the consequence of age
is implicit in License-To-Operate, Integrity & Operability (LIO) characteristics.
 Number & type of riser access is not included as a characteristic but is implicit in
Project Size and all but 3 of our present dataset had highly novel and complex
risers / caisson systems and there no apparent correlation with this issues &
outcome.
 Success Scoring has a degree of subjectivity, due to perspective, and could be better
refined but the strong correlation with complexity indicates this is not critical.
8
Page 1 - Characteristics 1 to 9
9
10
11
Complexity Versus Outcome
Scatter Diagram
70
Complexity
DEV A1 DEV B1
Versus
Outcome ?
60 Technical
DEV B4 Limit?
50
DEV B7
DEV A3
Complexity %
DEV B8
40 DEV D3
DEV B6 DEV D2
30 DEV E1 DEV B5
These 4 were written DEV B3
off, or had >100% DEV C1
DEV A2
supplemental AFEs Your
Project ? DEV B2
20
DEV D1
10
10 20 30 40 50 60 70 80 90 100
Outcome %
Worst 5 12
Best 5 Greenfield so excluded
Complexity Versus Outcome
Success Chart & Trend
16 6.00
Technical Success
14 Commercial Success
5.00
Schedule Success
f(x) = 0.250894327010324
Outcome x − 0.169923850580014 5
12 R² = 0.877391656150213
/ Complexity
5 5 5 4.00
Linear (Outcome
/ Complexity) 5 5
10 4 4 4
Outcome / Compelxity
5 5
4 3.00
Success (out of 15)
8
3 5
2.00
3 5 5 5
6 4 4 4 4 4 4
4 4 4
1 1 3 1.00
4
1 3
2 2 2
1 1 5 0.00
2 4 4 4 4 4 4 4 4
1 3 3 3 3
2 2 2 2 2
1
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Worst 5 Best 5 & Your Project
13
Overall Average = 68%, Best 5 = 88%, Worst 5 = 47%
What Characterises the Best 5 ?
14
 All delivered or will deliver their Functional Objective.
 All had LIO scope defined pre-sanction and no change in Execute.
 All worked within the Platform POB limit, accepting any schedule limitation
&/or moved other work as required.
 All fully understood structural capacity of host before proceeding.
 All had a lean, empowered & agile organisation.
 None were Big (>$500mm) Projects, excluding Drilling.
 None had a Flotel (consequence of offshore man-hours).
 None had a BLP or new structure added.
 None had challenging reservoir characteristics.
 None added POB as part of project
 40% of them used independent FEL assessment (20% > avg.).
 Only 60% of them were multi-dimension projects (20% < avg.).
 Only 40% of them had HLV requirements (20% < avg.).
15
LIO Scope Understood Q32 Complex Interfaces with Co-owners
Q29 - and factored into execution planning - Q17 HLV?
Q1 Big Project (>$500mm) ignoring Drilling Q9 Use of IPA/FEL assessment or similar Q4 Regulatory pressure / driver / demands ?
Was Project able to invest an appropriate level of

LIO Scope emerged during project Execution Q6 Single Dimensional project Q26 trust in EPC Contractors for scope/schedule?
Q13 impacting Delivery or disrupting Operations?
Q7 Multi dimensional Project Q8 Novel Technology

Q15 Flotel?
Project as planned / executed WILL or DID Q19 Significant Brownfield?

Q30 Q25 Planned for POB limits on host platform
deliver Business Solution / Value
1.0 1.00
0.93
0.9
0.87
Deviation from average

0.8 0.80 0.80
for best 5
0.80
Average 0.33
0.73
Deviation span
0.7 for best 5
0.67 0.67 Contracting
Characteristic
0.6 Regulatory 0.60

Legend
Characteristic
Scope
Characteristic
0.5
0.47 Execution 0.47
Characteristic
0.4 Organisational
Characteristic
0.33 0.33 Outcome 0.33

Characteristic
0.3
0.27 0.27 0.27
0.2 0.20 0.20 0.20 0.20 0.20
0.13 0.13 0.13 0.13

0.1
0.07 0.07 0.07
0 0.00 0.00 0.00
Q29 Q1 Q13 Q15 Q30 Q25 Q17 Q9 Q6 Q7 Q2 Q3 Q5 Q18 Q33 Q24 Q31 Q28 Q16 Q23 Q11 Q14 Q20 Q27 Q22 Q12 Q10 Q21 Q32 Q4 Q26 Q19 Q8
-0.1 Big or cumbersome Owner Organisation BLP (inc Bridge) or Jacket/topsides?

HP/HT, EHP/EHT or significant reservoir
Timely assessment of significant Structural issues on complexities or characteristics
16
Small empowered & Agile Owner Organisation
host platform?
-0.2
What Characterises the Worst 5 ?
17
 All failed to define LIO scope prior to Execute & had significant change.
 Almost all failed to deliver any value.
 Almost all failed to work within host POB capacity
 Almost all had a Flotel (consequence of offshore hours)
 Almost all had fragmented EP&C contracts.
 Almost all had HLVs, subsea scope and were large, multi-dimensional
projects.
 Almost all proceeded with detail design before finishing FEED.
 Most failed to assess structural capacity of host prior to proceeding.
 Typically had more unrealistic schedules for size / complexity than average
(27% > avg.)
 Typically added POB capacity more often than average (27% > avg.).
 Typically more cumbersome organisation than avg. (20% > avg.).
 Typically complied fully with stage gate process (20% > avg.), which is
negatively correlated with poor outcomes.
18
LIO Scope Understood - and factored into execution Detail design progressed but managed well prior to
Q1 planning?
Q23 System Engineering completion?
Use of IPA/FEL assessment or similar? Q9
LIO Scope emerged during project Execution Timely assessment of significant Structural issues on
Q13 impacting Delivery or disrupting Operations?
Q3 host platform?
Significant Brownfield? Q19
Owner Owned / Led the Project as true Integrator -

Q25 Planned for POB limits on host platform Q12 Integrated Detail Design and Fabricate/Construct?
not just "micro managing" EPC Contractors
Q10
Q15 Flotel? Q31 Overly aggressive Schedule? Stage Gate applied - in full? Q22
Project as planned / executed WILL or DID deliver

Q30 Business Solution / Value
Q24 POB addition as part of Project? Novel Technology Q8
1.0 1.00
0.93
0.9
0.87
0.8 0.80 0.80 0.80

Deviation from average
for worst 5
0.73
Average 0.33
0.7
0.67 Deviation span 0.67
for worst 5
Contracting
0.6 0.60 Characteristic
Regulatory
Legend
Characteristic
0.5 Scope
Execution
0.4 Characteristic
Organisational
0.33
0.3 Outcome
0.27 0.27 0.27 Characteristic
0.2 0.20 0.20 0.20 0.20 0.20
0.13 0.13 0.13 0.13

0.1
0.07 0.07 0.07
0 0.00 0.00 0.00
-0.1
Big or cumbersome Owner Organisation Small empowered & Agile Owner Organisation
-0.2
19
What is Different & Similar
between Best & Worst 5
20
Differences between Best / Worst 5
LIO Scope Understood - and factored into execution Detail design progressed but managed well prior to
Q1 planning?
Q23 System Engineering completion?
Stage Gate applied - in full? Q22
LIO Scope emerged during project Execution

Q13 Q29 Big Project (>$500mm) ignoring Drilling? Novel Technology Q8
impacting Delivery or disrupting Operations?
Q15 Flotel? Q17 HLV? Significant Brownfield? Q19
Project as planned / executed WILL or DID deliver Timely assessment of significant Structural issues on
Q30 Business Solution / Value?
Q3 host platform?
Q25 Planned for POB limits on host platform? Q2 Big or cumbersome Owner Organisation?
Q5 Small empowered & Agile Owner Organisation

1.0 1.00
Q24 POB addition as part of Project?

0.93
0.9
Q31 Overly aggressive Schedule?
0.87
Deviation between
0.8 0.80 0.80 best & worst 5 0.80
Deviation span
0.73 for worst 5
Average 0.33
0.7
0.67 0.67 Deviation span
for best 5
Contracting
Legend
Regulatory
Characteristic
0.5 Scope
Execution
Characteristic
0.4
Organisational
0.3 Outcome
0.2 0.20 0.20 0.20 0.20 0.20
0.13 0.13 0.13 0.13

0.1
0.07 0.07 0.07
0 0.00 0.00 0.00
-0.1
-0.2
21
Differences between Best / Worst 5
Best 5 Worst 5 Δ Average
Delivering Value 100% 20% -80% 73%

Define LIO Scope (& didn’t get growth) 100% 0% -100% 67%
Work within host POB 100% 20% -80% 73%
Flotel 0% 80% -80% 27%
Assess Structural Issues 100% 40% -60% 80%
Complete FEED pre sanction 80% 20% -60% 67%
Big Project 0% 60% -60% 47%
Added POB 0% 40% -40% 13%
Aggressive Schedule 0% 40% -40% 13%
Cumbersome Organisation (& not agile) 0% 40% -40% 20%
HLV 40% 80% -40% 67%
Novel Technology 20% 0% +20% 7%

Full application of Stage Gate 20% 40% +20% 20% 22
Similarities between Best / Worst 5
 Characteristics which appear to have no

influence in outcomes include:
– Co-Owner [including host facilities] Interfacing (as never an issue)
– Application of Stage Gate Process in Principle (as always done)
– Owners truly acted as integrator and gave EPC Contractors space (as always done)
– Small Projects Size (as always small or small included as included in medium or big)
– Ability to trust their EPC Contractors (as always done)
– No impact from Regulatory pressure (as virtually never an issue)
 Characteristics where there was no appreciable

influence in the outcomes include:
– Use of independent IPA assessments
– Whether Modules or BLPs were included or not in project scope
– Medium size, extent of subsea or multiple project dimensions are not dominant factors
– Experience level of Owner and Contractor organisations
– Owners were (virtually) always able to rely on their EPC contractors and act accordingly
23
The Rules
24
The 8 Rules (Rules)
Number Rule Number Rule
Ensure the business case is Ensure Project is a good strategic fit

1 robust and it can tolerate the 5 for the Asset at its stage in the
Brownfield Execution Risk. lifecycle
Ensure Project value-ranked against

Ensure Jacket & Topsides
2 Structure can accept the 6 competing scope (Integrity
Maintenance, Obsolescence &
additional weight.
Drilling) to secure POB.
Ensure definition a stage ahead Ensure alternatives to Brownfield

3 of where a greenfield project 7 have been considered and the scope
would be at the same gate. has been minimised.
Ensure Performance
Management method for Ensure POB capacity and alternatives
4 Execution is defined and 8 have been fully defined & assessed.
planned.
25
Supplemental Data
26
BLP Success Chart & Trend
BLPs = 73% & R2 = 0.91, so slightly better than average and more predictable
27
Overall Average = 68% & R2 = 0.88, Best 5 = 88%, Worst 5 = 47%
Module Success Chart & Trend
Modules = 67% & R2 = 0.871, so equals Average & wide variability in Success.
28
Overall Average = 68% & R2 = 0.88, Best 5 = 88%, Worst 5 = 47%
Technical Success – 1 to 5 Definition
Success Definition Score Score Definition
Dimension
1 "No oil, or virtually none, delivered after all investment made.”
"Reserves delivery nearer 1P than 2P and significantly less value, potentially

2 negative, delivered by Development due to significant gaps in either facility or
reservoir performance.“
Full throughput
delivered safely with
no harm to
Technical environment soon 3 "Reserves lower than plan / AFE / Promise but between 1P & 2P due primarily to
significant reservoir/well performance issues.“
Success after start up and no
significant releases or
outages in first few
years of field life "Majority of reserves (>= 2P) to be delivered proven up or can be exploited and
only constrained by facility uptime / throughput due to major unplanned outages
4 or significant facility constraint or need for significant de-bottlenecking to extract
value."
5 "Full reserves delivery (>= 2P) as per plan / AFE / Promise with no constraint due
to facility capacity or uptime."
29
Commercial Success – 1 to 5 Definition
Dimension
“Project or development cancelled in its entirety consuming rather then creating

1 value even after recovery of any pre-investment/expenditure on physical assets
(write off)."
“bbls/d delivery somewhere between >1P and <2P forecasts, well within facility
2 design capacity indicating poor reservoir-facility design match and thus either
excess investment &/or significant supplements (exceeding 100% of AFE) after
Promised economic sanction of final development plan to secure this restricted delivery."
value from project
delivered with no
significant erosion of “bbls/d deliver somewhere between >1P and <2P forecasts, well within facility
Commercial value due to schedule 3 design capacity, indicating poor reservoir-facility match and either excess initial
Success investment &/or significant supplements (but not exceeding 100% of AFE) needed
overruns or significant after sanction of final development plan to secure this restricted delivery."
events in first few years
of field life.
“bbls/d delivery meeting predicted rates near 2P forecasts, at or near facility
4 design capacity, indicating good facility /reservoir match but perhaps
supplements beyond contingency forecast (but not exceeding 50%) required after
sanction of final development plan to secure planned delivery."
“bbls/d delivery sustainably higher then predicted rates, exceeding nameplate or

5 design capacity and >2P reservoir forecasts and no significant supplements after
sanction of final development plan. Opportunity to de-bottleneck to deliver
enhanced value."
30
Schedule Success – 1 to 5 Definition
Dimension
"First oil, likely at limited rate, over a year later than best practicable schedule
1 based on complexity, perhaps a few years behind plan and promise which were
very overly optimistic and beyond stretch."
"First oil, likely at limited rate, many months but not exceeding a year later than
2 best practicable schedule based on complexity, and significantly behind plan and
Project Benefits promise, which were perhaps somewhat optimistic and were stretch or P10. "
Schedule realised at or around
Success Sanction schedule
expectations
3 "First oil, possibly limited or constrained, later than promise and plan."
"First oil, even if limited or constrained rate, on or before promise but later than
4 plan."
5 "First oil at expected rates beating Promise and before plan."
31

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Topsides Brownfield Projects

 Brownfield Projects are complex undertakings which are often

Success Dimension Definition

Commercial Success Promised economic value from project delivered with no

Schedule Success Project Benefits realised at or around Sanction schedule

Was Project able to invest an appropriate level of

Q7 Multi dimensional Project Q8 Novel Technology

Project as planned / executed WILL or DID Q19 Significant Brownfield?

Deviation from average

0.6 Regulatory 0.60

0.33 0.33 Outcome 0.33

0.2 0.20 0.20 0.20 0.20 0.20

0.13 0.13 0.13 0.13

0 0.00 0.00 0.00

-0.1 Big or cumbersome Owner Organisation BLP (inc Bridge) or Jacket/topsides?

Owner Owned / Led the Project as true Integrator -

Project as planned / executed WILL or DID deliver

0.8 0.80 0.80 0.80

0.2 0.20 0.20 0.20 0.20 0.20

0.13 0.13 0.13 0.13

0 0.00 0.00 0.00

LIO Scope emerged during project Execution

Q15 Flotel? Q17 HLV? Significant Brownfield? Q19

Q5 Small empowered & Agile Owner Organisation

Q24 POB addition as part of Project?

0.2 0.20 0.20 0.20 0.20 0.20

0.13 0.13 0.13 0.13

0 0.00 0.00 0.00

Delivering Value 100% 20% -80% 73%

Novel Technology 20% 0% +20% 7%

 Characteristics which appear to have no

 Characteristics where there was no appreciable

Ensure the business case is Ensure Project is a good strategic fit

Ensure Project value-ranked against

Ensure definition a stage ahead Ensure alternatives to Brownfield

1 "No oil, or virtually none, delivered after all investment made.”

"Reserves delivery nearer 1P than 2P and significantly less value, potentially

“Project or development cancelled in its entirety consuming rather then creating

“bbls/d delivery sustainably higher then predicted rates, exceeding nameplate or

5 "First oil at expected rates beating Promise and before plan."

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