Energy corporations with large scale operations, like major pipeline systems, refineries and oil fields are faced with high operating & maintenance costs in order to ensure reliable, safe operations. Often maintenance programs are justified by custom, safety or environmental hazard, or a requirement to comply with a current code.

The challenge is to be able to control spending on operations and maintenance while maintaining reliable and safe operations that meet regulatory codes and environmental standards. We advocate an integrated decision management and portfolio approach to analyze the risks of reducing or discontinuing a practice, or conversely, increasing maintenance spending where necessary.

With a traditional approach it is difficult for management to manage costs when risks are not quantified, often overstated or are not known.

Our approach integrates elements of decision analysis and portfolio preference. By developing a simplified model that captures the key areas of risk and benefits each maintenance element is assessed on a consistent basis. Using a portfolio approach to roll-up the program it is easy to identify the most productive projects as well as the projects that should be modified, delayed or dropped. The method also identifies underfunding e.g. where there are higher risks than the corporate risk tolerance allows.

The application of the process within a large transcontinental pipeline system resulted in an initial savings of 20% and ongoing savings of 50% from the original baseline that translated into hundreds of millions of dollars of sustained value.

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