The EU SAP in Oil and Gas conference*, held in The Hague earlier this year kicked off with a magnificent entertainment from Steve Barnett, The Silent Conductor who, without saying a word, had the 1000 attendees playing a plastic pipe symphony in under 10 minutes. Great stuff. SAP’s Peter Maier, in his keynote, ‘Powering the Digital Energy Transformation,’ observed that the oil market will be living with price uncertainty for a while. Meanwhile the digital transformation, driven by big data, real time, internet of things, is happening now. Industry boundaries are blurring as oil and gas blends into automotive, chemicals, utilities and even retail. SAP is positioned at the digital core of the shift with S4/Hana, and with its role in collaboration networks such as Concur, Ariba and Fieldglass.
In the IoT context, SAP’s collaboration with OSIsoft got a plug. As did the 3000 startups working on Hana cloud solutions. One example is automated billing around a machine breakdown, a process that has been ‘re-imagined’ such that the machine talks to the cloud and orders spare parts and rustles-up maintenance personnel. ‘This is not science fiction, it is already supported by SAP.’ There ensued a demo of SAP’s asset intelligence network, a ‘Facebook for assets.’ This monitors, say, a pump room, holds the spare parts lists from the OEM, and checks pump flow and power use. Predictive analytics are run to anticipate failure. Such intelligence can be used to track machine health, to benchmark equipment and to manage inventory.
Engen’s Peter de Plooy endorsed the digital transformation meme as key to reducing costs. Digital is driving competitiveness and those that are not on board will not survive. It is no longer ‘business as usual,’ there is disruption and oil and gas will not be exempt. We need strategies to harness the power of analytics. Hana is valuable to us in a real time context. SAP’s Maher Chebbo elaborated on the social network for energy theme mentioning an ongoing project for a pan-EU ‘iTune-like’ platform for power distribution companies offering packaged, app-like services that are quick to deploy.
Mark Woolley (Accenture) described OSIsoft PI and SAP Hana integration. Oil and gas is used to big data from scada systems but what is new is the expansion of its usage footprint from operations to the information technology space. This OT/IT convergence is plugging the historical gap between the field and the enterprise. In the field a wide variety of acquisition systems are deployed, operating at different sampling rates and formats. Here data management is problematic, but largely solved with PI.
But there remains a big barrier, the ‘air gap,’ between OT and the enterprise applications for maintenance, finances and trading. The gap is effectively plugged with the SAP Hana to IoT connector for OSIsoft. Wooley outlined a deployment for a global US operator with worldwide operations with diverse assets and a ‘massive’ airgap between the field and back office. The operator wanted to better leverage its hardware/software skills and its Hana investment. Current operational data was inconsistent, duplicated, unreliable and un-timely (it took two days to get data into the office) limiting forecasting capabilities. The solution saw PI deployed as a consolidator for data from Cygnet, Honeywell and Kepware field systems with the PI connector for SAP removing the integration problems. Rapid configuration across data assets was enabled with the PI Asset Framework and Hana smart data access. Data can now be visualized in SAP Business Objects Lumira and SharePoint Web Parts. The operator now has a better understanding of deferment, now mitigated by standardized workflows and management by exception. A Hadoop data lake has also been deployed to store legacy data. Microsoft’s Revolution-R analytics also ran. Specific use cases include beam pump optimization, that now spans technical field performance and financial considerations like, is it worth shutting in to fix? The project, a ‘leap of faith’ for the customer took 25 weeks from inception to roll out.
Glen Endress (ConocoPhillips) introduced the SAP oil and gas global advisory council which he also chairs. The GAC partnership between SAP and industry is a ‘great opportunity to find out what partners and suppliers are doing to weather the storm.’ The GAC, run inside SAP’s JAM social media, is also where SAP learns about the industry and finds out what to provide. Some 20 plus companies meet twice yearly and initiate sponsor communities and workstreams. The GAC’s deliberations to date have informed the 2016 SAP Value Map.
SAP is aiming high with its Digital energy network as explained by Ken Evans. The DEN builds on digital trends of hyper connectivity, supercomputing and the cloud and represents ‘huge opportunities for business processes and business models.’ The DEN spans oilfields, assets, logistics, workforce and projects, going beyond oil and gas to embrace ‘diversity,’ for example offshore wind. A short demo revealed a nifty map interface showing tank levels, who has what and where, and allowing for wheeling and dealing by traders.
Janette Beinart described Shell’s long term commitment to SAP including its downstream transformation to a single SAP instance. SAP is now a key part of Shell’s digital ecosystem. Likewise Amazon web services is important in Shell’s drive to be nimble. SAP has people embedded in Shell working on innovation, value extraction and on running better. Shell now co-innovates with SAP, notably on its wells reservoir and facilities management system (Wrfm), now deployed in Qatar and Norway. Shell also has a well data warehouse running on Hana. Shell had made a big investment in Hana and is looking to extract more value from this in the low oil price environment.
Shell’s current IT landscape is ‘complex,’ Shell’s own code is very expensive to maintain and the company is look for alternatives. Today 80% of the effort goes into data and systems. Shell is determined to get more from its existing data resource and is working on a next generation edition of the Wrfm toolkit based on Hana. Also in development is a global production dashboard that exposes all Shell’s worldwide assets. Downstream, digital supports large scale turn arounds. One project in Qatar saw 5,000 new workers on site, again with Hana in the picture. Also of note is Shell’s ‘EA4U,’ enterprise architecture for un-conventionals, a massive data warehouse.
Samantha Hollingsworth described Bluefin Solutions’ work on Maersk Oil’s North Sea Culzean development. Here SAP (formerly Business Objects) business planning and consolidation BPC application has proved a good fit with capex projects. The BPC/Excel interface has encouraged take up by engineers and the tool offers tight integration with the SAP ECC stack adding ‘powerful analytics and process-led workflows.’ Bluefin Solutions adds a template to manage capex projects that mitigates ‘pain points’ in the standard SAP cost management solution. The Bluefin template builds on SAP ERP plus Primavera. On Culzean, a solution was conceived and delivered in three months. The project’s agile (non waterfall) development was a challenge to IT but has proved successful. The system has retained the Excel-based interface but loses Excel ‘data management.’ In the Q&A, Hollingsworth revealed that the template was retrofitted into Maersk’s existing (non Hana) SAP.
Moving to a next generation financials suite in a company as large as ExxonMobil is a major, long term proposition. Dave Drever outlined the first steps currently underway on the path to ExxonMobil’s ‘systems of the future.’ Exxon is not exclusively SAP, it does use other financial tools but has currently two SAP instances and is looking to add Hana, co-innovating with SAP on a universal journal concept. Exxon plans to rebuild its ERP on Hana and is figuring how to deploy S4/Hana in a non-disruptive manner. Early results with the Hana database are promising with better analytics, a 10 day close, simplified data structures and a single source of truth. Some 30 processes running on the ECC6 showed a 10-20x speedup on the Hana testbed. The Fiori GUI is being trialed on mobile devices. Otherwise Exxon is waiting for IS-Oil to be completely Hana-compatible before adopting.
Drever’s division is fine tuning the change management required for the real migration and is working on a roadmap for switching on the (interesting) new functionality. Exxon is striking a balance between co-innovating with SAP on functions that it requires and looking at how it does things, with a view to tweaking some processes to fit the software. Following a 2015 proof of concept, Exxon has set up a global team for further evaluation with interviews and stakeholder discussion. Not all feedback has been positive! There are two more proofs of concept underway, one to figure out the medium term benefits of S4/Hana and another to run on the upstream and test joint venture functionality. Exxon is also evaluating the possible replacement of other non SAP tools currently in use.
Richard Evans described the problems of performing analytics across BP’s multiple downstream SAP instances. In general, there is one instance per business unit, but some units have several. Head office analysts want to analyze across the entire estate and ask ad-hoc questions. BP leadership has demanded a group-wide focus on data and monitoring operations. Quarterly cycles are no good and cutting and pasting into Excel leads to mismatches and missing data. A new approach was adopted in 2015 with input from BP’s global process community and from SAP. This involved a relatively straightforward solution, SLT plug-ins to existing SAP instances, connecting them to a cloud hosted, non mission-critical Hana environment. The solution provides near real time replication and self service tools for users to ‘evolve thinking.’ Not so much a data lake as targeted data ‘puddles.’
Again, an agile/scrum development delivered first results in eight weeks. An agile service line means that new datasets can be pulled in as required. Evans was not at liberty to divulge what sort of queries BP is running, but the expected benefits are in the ‘tens of millions.’ Now, if a new query comes in, a data puddle is extracted. Once the query is answered, the puddle dries up. This allows BP to keep a handle on the size of its Hana environment. Folks may say ‘It would be nice to have a year of data.’ Evans says, ‘No, if you want last year’s number, write it down!’
From the IT perspective, the cloud infrastructure was built on AWS in hours not days or weeks. AWS was cheap ($100 for the first couple of weeks) and performant, with 1.5 billion records extracted in the initial load. Early on the pipework to AWS was not wide enough but even so, no records were dropped and there is no observable impact on operational ERPs. BP now has an established analytics platform that experts can call on sans local rules or regional fudges. ‘Hana has reduced the effort and complexity in gathering data and will allow analytics to be carried out on a single source of the truth.’
Back to Shell to hear Frank Udo on the thorny topic of equipment information handover from engineering to operations. Shell needed to reduce the time spend finding, validating and updating some 800,000 work orders for plant modifications per year, an $8bn value. Handover requires an integral view of asset information, for instance, for a pump, work orders, drawings and more. The idea, as often presented, is to key in a part number and retrieve the information, yet in the real world, such functionality has proved elusive! Shell has embarked on a strategic drive to data centric engineering solutions with a portal for operations. Udo digressed to say that his plumber already has this kind of information on his tablet! To bring its engineers up to the speed of Udo’s plumber, Shell is has done a deal with enterprise master data management specialist Utopia.
Mike Jordan outlined Utopia’s MDM solution for SAP. The challenge stems from multiple systems of record in asset intensive industries. Plant maintenance, engineering, GIS, ECM, EAM need to be in sync with as-built reality. Systems then need constant fixes and updates across handover, through turnarounds and the whole asset lifecycle. Some information is data centric, some document centric. A pump has manifestations in maintenance, in P&ID diagrams and in engineering systems. Jordan gave a plug for SAP’s free value engineering services in developing a business case. Utopia builds on SAP MDG for EAM, OpenText xECM, SAP Visual Enterprise and more 3rd party stuff. Raw data is moved into a staging area where it is filtered, cleansed and loaded to the MRO operating environment, built with the same tools as above. Now if a P&ID changes, this is propagated across the system of systems. The solution is work in progress and is due for release in Q3 2016.
On the topic of standards for engineering data exchange, a field where Shell has made an enormous effort in the past, it appears that the standards ardor has cooled. Data-centric standards make handover complicated. The current approach is to ‘standardize’ on a number of engineering tools. If a contractor can’t provide data in a particular format, then a standard tool is mandated. There is a balance to be found, and having hundreds of design systems is to be avoided. But today, handover is just not working! Utopia’s SAP EAM Workbench was championed by Shell and will likely figure in the SAP price list at a future date.
The SAP in oil and gas conference was co-hosted with TA Cook. Visit the conference home page.
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