Petro-Canada Refinery Conversion Project Presentation to AACE, Calgary November 9, 2005
TLM MOMENT All Losses are important and represent an opportunity to improve Health Safety Environmental Quality
BUILDING ON SUCCESS RCP IS IN THE HOMESTRETCH Execution phase is culmination of over 10 years of work RCP completes transformation of Edmonton Refinery & is critical to the continued economic success of Petro-Canada s downstream business Tank farm, SIG, EDD & GOT projects have built and continue to build a foundation of success for RCP Collectively, Petro-Canada, Bantrel, Jacobs & their subcontractors will cap off the conversion journey with a successful RCP project!
PETRO-CANADA CONTINUES TO PURSUE A FULLY INTEGRATED OIL SAND STRATEGY 2008+ 27,000+ bpd bitumen MacKay River Suncor 22,000+ bpd sour synthetic 26,000 bpd purchased sour synthetic In Situ 3035,000-40,000 bpd bpd purchased In Situ II bitumen blend 26/9 ~50,000 bpd sweet synthetic crude Edmonton Refinery 135,000 bpd refined products to market Syncrude
DESULPHURIZATION & RECONFIGURATION Edmonton Edmonton Refinery Refinery Edmonton Infrastructure Refinery Sulphur Pre Diesel Conversion Low in Support Sulphur Desulphurization Gasoline Program (Tank Fuels (SIG Operation Farm (RCP - 2004) (EDD 2-1 2008) 2003) --2001) 2006) Sweet Synthetic Synthetic Crude Unit Sour LightSyn & Crude Bitumen Conventional Sour Crude Crude & & Vacuum Vacuum Unit Unit BDS (Naphtha & Naphtha Distillate) Hydrotreater Distillate Hydrotreater Secondary Units & Product Blending Refined Products to Market Gasoil Hydrotreater 16.6 Delayed KBPD Delayed Coker Coker RCP Sulphur Sulphur Plant Plant Hydrogen Plant EDD Hydrogen Plant RCP Hydrogen Plant Tank Farm 1 Tank Farm 2
PROJECT SUCCESS CRITERIA PROJECT GOAL: To safely deliver a first quartile facility that will utilize bitumen derived feedstocks to meet the product demands as forecasted.
PROJECT SUCCESS CRITERIA Project Critical Success Factors: Zero harm to all who work on the project Acceptable project economics achieved by: Optimizing project execution - Execution excellence Delivering the FEED scope inside $1550MM Mechanical Completion by Q2 2008 Full nameplate capacity in < 45 days after mechanical completion Zero production impact on the existing facilities during commissioning People make projects work Communicate often, openly, & contracting for action
REFINERY CONVERSION PROJECT PROFILE Conversion of the Edmonton Refinery to Process 85,000 BPSD of heavy oil and Bitumen by 2 nd Quarter 2008 Scope Crude Unit Vacuum Unit Delayed Coker Revamp of Existing Units Sulphur Complex Associated U&O, Automation and Site Prep
RCP PROCESS AREAS Sulphur Complex Plant 63 Revamp Crude / Vacuum Delayed Coker Plant 2-4 Revamp Coker
CRUDE/VACUUM Crude Heater Vacuum Heater Vacuum Tower Desalter Substation & I/O Crude Tower
DELAYED COKER Coke Drums Rail Car Handling System Coker Fractionator Coker Heater
REVAMPS PLANTS 1, 2 & 4
REVAMPS PLANT 63
SULPHUR COMPLEX Amine Regeneration Area Sour Water Stripping Units Superclaus Unit Incinerator Sulphur Storage Amine Pumphouse & Surge Tank Sulphur Recovery Units
UTILITIES AND OFFSITES
PROCESS AUTOMATION OBJECTIVES: Provide fully integrated process control system integrating existing and new units Ensure all areas of system design and execution comply with existing standards and are consistent across areas SCOPE CAN BE DIVIDED INTO 2 PARTS: Upgrade existing control system to new Experion operating Platform Process Control implementation
PROCESS AUTOMATION
CURRENT STATUS Feed completed Long lead equipment order placed Stage Gate Review completed Baseline established Petro-Canada Board approval received Execution Phase Kick-off November 7 th, 2005
PROJECT BASELINE Capital cost $1.55 Billion Schedule completion April 2008 Project Approval October 2005 Site Prep complete March 2006 Construction start April 2006 Engineering 80% complete November 2006 Module fabrication commences March 2006 Construction completion in Shutdown April 2008 Full production 2 nd Quarter 2008 Zero Harm, Zero Loss, Zero Impact
ESTIMATE BREAKDOWN Sour Crude/Vacuum Sulphur Complex Delayed Coker Existing Plant Revamps U&O (including Site Prep & Automation Owners Cost
EXECUTION STRATEGY Petro-Canada Managing Contractor EPC Silo Execution (Jacobs and Bantrel) Sub-contractor and DFL Construction Supplier of Choice Agreements Work Package approach to E P & C 80/100 strategy for construction packages WBS supports Execution Plan Bag and Tag approach to Revamp work RFO integral part of Project Team Site preparation to be completed in early 2006
PROJECT SILO STRUCTURE RCP Crude Vac Coker Automation F&I Sulphur Complex Revamps U&O Bantrel Bantrel Bantrel Bantrel Jacobs Bantrel Bantrel
PROJECT EXECUTION STRUCTURE General Automation Contractor, GAC Crude/ Vaccume Delayed Coker Sulphur Complex Utilities & OffSite Revamp Construction Facilities and Site Infrastructure, F&I
EXECUTION STRATEGIES Scope is defined robust FEED package Funds are allocated the resources are available Teams are experienced - and know how to do it They know the Refinery, its people and requirements They have the systems, structures, methodologies, procedures and lessons learned RCP will Build on Success of recent successful projects RCP is larger than EDD, it is much more complex Market conditions, complexity, site congestion, integration We will take it to the next level!
EXECUTION STRATEGIES The Project participants are working together to further a culture of cooperation, no surprises and no changes. Open and honest communication Regular and frequent contact Clear expectations of roles and responsibilities Discussion and alignment with success criteria Adherence to procedures and execution plans Identify potential issues when they arise No Surprises Proactive versus reactive
PROJECT CHANGE CRITERIA Scope is defined Execution Plan has been optimized by the team Non-discretionary changes affecting design, only if: It is not safe or environmentally acceptable It won t work It s not operable or maintainable It doesn t meet regulatory requirements Discretionary change: Return on investment > 50% / 1 year payout for proposed scope versus design specifications No schedule impact
COST & SCHEDULE Schedule Schedule basis is backward driven from RFO completion Level 3 FEED is baselined Cost Control Sanction is $1550 Million, including Owner s cost The project is cost driven and must deliver Trend surveillance, especially on quantities, as design progresses is the key The projects needs everyone to play a role Progress Measurement Key quantities and deliverables updated on a regular basis IFCs must be linked to the schedule
CONSTRUCTION EXECUTION ZERO HARM, ZERO REWORK, ZERO IMPACT Basis for construction sequencing is Systems Handover priorities This drives engineering IFC issues Engineering planning is driven back from RFO handover EWP-CWP- IWP PIPE INSTALL HYDRO FLUSH REINSTATE PRE-COM HANDOVER Management of Interfaces across the silos is key to successful RCP construction completion U & O Team to lead RCP Team to make Edmonton Refinery the site of choice for Trades THOR
PROCUREMENT EXECUTION The very hot market makes it critical that we complete vendor awards quickly with quality packages and control changes This requires diligent inspection in the vendor shop throughout the process Expediting and Quality control starts with the order and continues until the material is satisfactorily delivered at site Procurement Quality on schedule, meets specs and complete PC has established Supplier of Choice (SOC) agreements for key bulk piping materials that will be used by the EPCs
ENGINEERING EXECUTION Maintain the 80/100 rule with all deviations processed through the MOC Procedure Engineering execution is quality and timely delivery adhering to the schedule Ensure data is received early to support design Consider all avenues to advance required vendor information Early planning reviews have been conducted for: Constructability Operability Maintainability Construction sequencing Regular quantity trending as design progresses
MOVING FORWARD To meet Petro-Canada s expectations, the project is focusing on the road ahead with energy, vigor, rigor and diligence The FEED package is robust. The project has a very experienced project team However, we have risks
SIGNIFICANT RISK TO SUCCESS Competitive Market Place Home office personnel availability Equipment cost and delivery schedule Bulk material cost and availability Fabrication shop loading Subcontractor availability Labour cost and availability Construction supervision Construction equipment availability
BUILDING ON SUCCESS
QUESTIONS?