Objectives/Scope: Please list the objectives and/or scope of the proposed paper. (25–75 words)

The intent of this paper is to recognize and address the challenges that downstream companies face across their value chain including a history of having siloed businesses processes that have created ‘value leaks’. We propose an unified operations management approach that orchestrates all activities across the value chain as part of an enterprise digital transformation strategy. Business process can be deeply transformed when operations, supply chain and process optimization are connected in a collaborative environment.

Methods, Procedures, Process: Briefly explain your overall approach, including your methods, procedures and process. (75–100 words)

Refineries are at different stages in their digital transformation journey and have built their business workflows over many years across multiple point solutions.

We propose a digital transformation strategy for operations across five key characteristics, that is:

  • Comprehensive: an enterprise solution across all layers of the value chain that breaks down business silos and creates collaboration

  • Flexible: allows businesses to start at any point in their own transformation journey with solutions for each specific component of the value chain

  • Connected: opens new possibilities and workflows to drive unique business process improvement

  • Modern: leveraging latest technologies for the best user experience, an agile performance and focus on reducing cost of ownership

  • Transparent: visualisation and advanced analytics that improve management decision making across the value chain

Results, Observations, Conclusions: Please describe the results, observations and conclusions of the proposed paper. (100–200 words)

Across a refinery's value chain there are significant benefits that can be realized by approaching digital transformation across their operations enabling end-to-end value chain optimization including:

  • Supply Chain ($20-150M/year):

    • ○

      Crude Purchases - Reduced cost of purchases, reduced maintenance

    • ○

      Planning, Scheduling and Logistics: Increased throughput, increased yield

  • Process Performance ($10-50M/year): Longer equipment life, increased availability, increased quality, increased yields

  • Blending and Oil Movements ($5-50M/year): Reduced giveaway, no rework, minimum inventory, minimum downgrades, higher fuels agility

  • Energy Management ($5-25M/year): Reduced energy conversion cost, reduced energy consumption cost, reduced cost of crude for energy

  • Production Management ($2-5M/year): Reduced accounting losses, reduced inventory, reduced hydrogen and steam consumption, increased throughput

  • Operations Management ($2-5M/year): Reduced unplanned shutdowns, increased yield, reduced hydrogen and steam consumption, increased throughput

Novel/Additive Information: Please explain how this paper will present novel (new) or additive information to the existing body of literature that can be of benefit to and/or add to the state of knowledge in the petroleum industry. (25–75 words)

This paper is novel as it takes a wholistic look at a refinery operations value chain and eliminating existing value leaks end-to-end. It recognizes how existing systems have been built-up on outdated technology and siloed business process and proposes a path forward bringing operations, supply chain and process optimization together as a key element of a digital transformation strategy. The paper also explores how AI & prescriptive models pave the future for optimization.

Keywords:
knowledge management, machine learning, upstream oil & gas, risk management, real time system, artificial intelligence, digital transformation strategy, information, collaboration, optimization
Subjects:
Risk Management and Decision-Making, Information Management and Systems, Knowledge management, Artificial intelligence
Copyright 2020, Society of Petroleum Engineers
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