Transformations of DSM

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1 Life Time Extension A tool for asset management Jacko Aerts / Hugo Verkerke DSM Operations & Responsible Care Asset Management NL, 21 September 2016

2 Transformations of DSM 1

3 Asset Management developments Before One huge central site (Geleen) + satellites Centralized engineering + maintenance One DSM engineering standard Comparable asset base common expertise One culture one language (Dutch) Nowadays Global, >100 sites, most small Asset diversity Local engineering + maintenance Compliance to many different standards (GMP, etc.) Different engineering standards through acquisitions Cultural diversity One DSM - company language (English) 2

4 Asset Management in DSM Corporate DSM - Asset Management & Technology team (secure and develop competences: Maintenance, Process Control, ) - Manufacturing Excellence as management system - DICI as continuous improvement tool (supported by TRACC) - SAP for maintenance and projects - IVARA as Reliability Engineering Tool Business Groups - BG strategy and objectives (Growth, hold, harvest, disinvest) for the complete BG asset portfolio Site - Plant maintenance and operations strategy and objectives 3

5 Asset Management challenge Realize value today Integrity and compliance SHE Asset Utilization Costs Energy Realize value tomorrow Condition of the organization competence plans Condition of the assets LTE 4

6 Asset owner/user issues My plant is 32 years old; what now? Production capability in line with market demand? Still compliant in 3 years? CAPEX spend over next 10 years? Spare parts availability? Integrity Quick Scan (IQS) Hidden issues / surprises? Which plant can be my Queen Bee site? Quality issues in the future? Life Time Extension Project (LTE) 5

7 Status FOR INTERNAL USE ONLY Is it just old, or is it aged? Ageing is not about how old your equipment is: It s about what you know about its condition, and how that s changing over time From: Plant Ageing RR509 HSE 2008 Improve LTE Harvest Age of this plant is (only) 5! years Years 6

8 How old is this air filter? 2.5 y - 5 y - 10 y - 15 y 7

9 DSM LTE - Background Aging plants, beyond design lifetime Acquired plants, unknown integrity status Need for long term sustainable, robust, reliable operation Top down pressure: no surprises Missed opportunities for improvement Move from project wish list to structured 10y CAPEX program DSM LTE approach developed in line with outcome Vitale project. Vitale Joint Industry Project in NL aimed at asset management of ageing equipment 8

10 Comparing LTE to IQS Life Time Extension Project approach ~3 months Detailed status & action reporting Cost estimates and timing Predict years SHE/LTO and Operations focus Actions on top of normal maintenance Integrity Quick Scan Quick scan approach ~1 week Highlights / Lowlights Expert judgment of status Predict 3-5 years Mainly SHE focus Effectiveness of normal maintenance Year RLD y RLD 10y Civil Static Rotating Systems Instrumentation Electrical Grand 17430total

11 Process flow LTE Time What ~1 month Scope definition & preparation (corporate expert + site contact) 1 2 weeks 1 st visit Kick-off, walkarounds & interviews with experienced site people: hands-on training of LTE methodology 4-8 weeks Site continues to fill LTE file; Remote support by corporate expert 1 2 weeks 2 nd visit Challenging and completion of LTE file; Final presentation and hand-over; Risk ranking of first LTE year 1 year later Feedback: how well does LTE work for you? 10

12 DSM LTE scope In Scope Future integrity Spare parts availability Knowledge availability Reliability/ Robustness Repair replace Compliance/LTO Out of scope Normal maintenance Debottlenecking/ improvement projects Engineering and detailed costing Operational cost savings Office ICT 11

13 When does maintenance become LTE? Remaining life > 10 y Y Healthy Normal maintenance N Additional Maintenance Remaining life > 3 y N Y Concerning Limited extra maint. possible? (cost < 60% of replacement) Y LTE: Overhaul/ replace Unhealthy N 12

14 LTE covers all disciplines Static Rotating Electrical Instrumentation Control systems Civil Piping, vessels, heat exchangers, etc. Pumps, centrifuges, compressors, etc. Transformers, switchgear, cables, E-motors, etc. Flow, pressure, etc. DCS, PLC s, etc. Buildings, sewers, fence, etc. 13

15 Spare parts / knowledge still available? 14

16 Tankfarm, piperacks, roads, grounds, ponds 15

17 DSM LTE Reporting item Status Why? Action & estimate What? Recommendations / Impact Estimate in year Line item totals 16 Year totals

18 DSM LTE Costs Year LTE 10y+ Civil Static Rotating Systems Instrumentation Electrical Grand total

19 DSM LTE : from Issue to Action (integrity) issue (integrity) issue (integrity) issue Budget limitations Resource limitations Consequences All amounts in keur Year LTE 10y+ Civil Static Rotating Systems Instrumentation Electrical Grand total LTE or Maintenance LTE based on likelyhood LTE based on risk Maintenance But the costs don t disappear! 18

20 DSM LTE: Added value for Asset Management Known CAPEX investments to secure future operations Adjust in time to business needs Status of equipment known Support strategic investment decisions Prevention of nasty surprises Challenges: LTE gives guestimates, Financials read hard numbers Connect LTE with process improvements Experienced people doing LTE 19

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