A New Way to Extract More Value from Your Production Supply Chain. with Production Accounting and Reconciliation (PAR)

A New Way to Extract More Value from Your Production Supply Chain with Production Accounting and Reconciliation (PAR)

Outline Accounting Process Basic Enhanced Challenges to achieving Enhanced Value PAR helps overcome Challenges PAR Value Proposition Basic Value Enhanced Value Technology Impact Summary 2 2015 Honeywell International All Rights Reserved

Basic Accounting Process Production Accounting is the process of measuring, validating and publishing accurate and reliable balanced facility production data Flare, Losses Feeds Products Receipts Process Units Shipments Measured, Interfaced or Manually Entered Inventory Mass/ Volume Inventory Mass/ Volume Measured, Interfaced or Manually Entered Sulfur, Fuel Helps to identify and reduce feedstock and product stock losses Supports high level Plan vs Actual performance monitoring Ensures accuracy of plant feedstock and product inventory positions 3 2015 Honeywell International All Rights Reserved

Basic Accounting with Unit Reconciliation Production Accounting and Data Reconciliation is the process of measuring, reconciling, validating and publishing accurate and reliable balanced facility and unit production data. Flare, Losses Feeds Intermediates Products Receipts Measured, Interfaced or Manually Entered Inventory Mass/ Volume Process Unit Process Unit Process Unit Inventory Mass/ Volume Shipments Measured, Interfaced or Manually Entered Sulfur, Fuel The difference in the process is the inclusion of detailed statistical reconciliation of unit by unit streams and measurements. 4 2015 Honeywell International All Rights Reserved

Basic Accounting with Unit Reconciliation The value proposition is as in the base case Helps to identify and reduce feedstock and product stock losses Supports high level Plan vs Actual performance monitoring Ensures accuracy of plant feedstock and product inventory positions In addition, the Data Reconciliation process Catches errors and missing transactions Identifies equipment and instrumentation problems Supports detail unit and stream level Plan versus Actual monitoring Identifies intermediate product losses Supports process analysis and simulation Supports Utilities Balances (E.g. Steam, Fuel Gas, Energy, etc) 5 2015 Honeywell International All Rights Reserved

Challenges to delivering Sustained Value Ease of Use Ageing Design & User Interface Methods Work force Churn Model Maintenance Monolithic models Extensions Requires vendors expertise. Data Collection Bad Data Quality Inconsistent Integration with other apps Cost of Ownership Technology platforms are aging Vendor investment is reducing Limited localized expert support 6 2015 Honeywell International All Rights Reserved

Ease of Use Graphical configuration and run-time results delivery facilitates model maintenance and understanding of reconciliation results Visual Cues helps gain perspective and provide a seamless workflow to close balances Integrated manual entry and inline override of suspect values allows for rapid iteration to a successful solution. Flexible reporting and Excel export enables results to be easily shared and used for extended analysis. Designed according to Honeywell User Experience (HUE) mandates 7 2015 Honeywell International All Rights Reserved

Understand the Imbalance View Key Stream Information Understand Inventory patterns Understand Shipment / Receipt patterns 8 2015 Honeywell International All Rights Reserved A configurable high level overview of the key production values

Statistical Reconciliation to Close Balances Balance Quality of 1 indicates the Optimum balance state Review Balance Quality & Analyze the next Errors Identify the Equipment with Highest Gross Error 9 2015 Honeywell International All Rights Reserved Adjust Process Measurements

Missing Movement Identification Missing Movement Solver identifies potential missed movements and provides feedback on the delta in objective function from the change 11 2015 Honeywell International All Rights Reserved

Review & Approval with Audit Supervisor receives an Email indicating that the data is available for review Supervisor reviews the Audit Log to understand changes made, then uses the Net Production Report to verify the closing balances Supervisors review all of the metrics, flowsheet, schematics Supervisor chooses to Close the balance period. 12 2015 Honeywell International All Rights Reserved

Share Results Once an accounting period is set to Closed, Reconciled Data can be stored in a historian, where it becomes accessible to other applications Store Data in Historian Data can be exposed for use in Intuition Executive Dashboards Reports MTD YTD trends by material help get a good insight on performance against plan Dashboard Production Metrics 13 2015 Honeywell International All Rights Reserved

Share Results Using Excel Analytics User can select the data that are required to be read from PAR. These query parameters can be SAVED as part of the Excel File, so that it can be reused Provides pre-defined views to expose the data. 14 2015 Honeywell International All Rights Reserved

Model Maintenance Flexibility to combine use of Graphical configuration with Excel based bulk configuration, simplifies the maintenance effort. Ability to use and manage Multiple Models allows for easier handling of special cases Offline Model Tuning help refine the model robustness and reconciliation accuracy Ability to partition the model in to Multiple Active Flowsheets improves understanding and usability. Simple Migration Path from Honeywell s Production Balance 16 2015 Honeywell International All Rights Reserved

Easier to Configure Graphical Flowsheet's Modular Graphical Flowsheet's Bulk Configuration using Excel Model creation can be done by a mix of graphical Flowsheet modelling and Excel Graphical Flowsheet can be bulk loaded from an Excel worksheet 17 2015 Honeywell International All Rights Reserved

Easy to Configure Graphical Flowsheets Reuse Models Model Tuning CDU Train 1 COPY CDU Train 2 Change Tag Configuration using Excel Eliminate Non Observable streams & improve overall redundancy to drive better reconciliation 18 2015 Honeywell International All Rights Reserved

Model Maintenance Flexibility to combine use of Graphical configuration with Excel based bulk configuration, simplifies the maintenance effort. Ability to use and manage Multiple Models allows for easier handling of special cases Offline Model Tuning help refine the model robustness and reconciliation accuracy Ability to partition the model in to Multiple Active Flowsheets improves understanding and usability. Simple Migration Path from Honeywell s Production Balance Intuitive features reduces maintenance and learning time by up to 20% ensuring sustained delivery of benefits 20 2015 Honeywell International All Rights Reserved

Data Collection Process Manual Data Entry is inherent in to the tool to ensure minimal interruption in the workflow process to make adjustments and enter data. Automated web services based access is available through Honeywell s Data Access Service (DAS), providing high integrity standards based data retrieval from diverse systems. Data access methods use Active Caching and Bulk Data Requests to maximize performance. Data Sanity checks ensure that Data Collection issues are highlighted 21 2015 Honeywell International All Rights Reserved

Data Access Service - DAS All applications make use of the Honeywell Universal Data Access Service (DAS) that based on WCF provides shared services, data federation and data caching Intuition Executive Production Accounting (PAR) IX DB IKPI DB OSI-PI S A P K P I I O M DAS Shared plug-ins allow access to data across Honeywell and third party applications. Standard plug-ins are available for many Applications New plug-ins can be built and commissioned without changing existing applications 22 2015 Honeywell International All Rights Reserved I X P A R O P C

In-built Data Sanity Check Simple Balance Identify Nodes where sum of the inputs differ significantly from the sum of the outputs. Useful to identify any missed movements or major measurement problems Intelligent Diagnostic Example Data Checks are Measurement exceeds Range Limits Tank inventory changes with no in/out movements Tank rises / falls with no movement in / out. 23 2015 Honeywell International All Rights Reserved

Data Collection Process Manual Data Entry is inherent in to the tool to ensure minimal interruption in the workflow process to make adjustments and enter data. Automated web services based access is available through Honeywell s Data Access Service (DAS), providing high integrity standards based data retrieval from diverse systems. Data access methods use Active Caching and Bulk Data Requests to maximize performance. Data Sanity checks ensure that Data Collection issues are highlighted Ensure quality data delivery with standards based, performance optimized data access methods 24 2015 Honeywell International All Rights Reserved

Cost of Ownership Leverage the benefits of New Technology platforms to provide enhanced usability and sustainability Easy Migration from Production Balance ensures return on past investments. Operator Entry screen for Inventory and Movements avoids costs to build and maintain custom screens. 25 2015 Honeywell International All Rights Reserved

Easy Migration from PB Excel Template to Migrate Configuration Automatically create Graphical Flow sheets PB PAR Utility to Migrate Transactions PB PAR 27 2015 Honeywell International All Rights Reserved

New Technology Impacts Hardware Cost Avoid Hardware Cost by deploying PAR on Virtualized VM Systems Software Cost Support and Maintenance Integration Avoid pre-requisite licenses for Oracle / Crystal Reports In built Operator entry screens for Movement & Inventory, avoids the cost of building custom screens. Globally available Local Support Receive Software Updates & Security fixes through BGP subscription Platform Support - Windows 2012/ SQL 2012 Improved Integration to Historian, Movement Management Systems, ERP, LIMS User Training In Built Demo Models support faster on-boarding Visual aids, metrics and diagnostics to help in better learning. Time To Implement Reduced Configuration effort through features such as Graphical Modelling, Multiple Flowsheet s, Versioning, Bulk Configuration. Scalability Distributed Server Deployment to be able to scale to larger accounting models 28 2015 Honeywell International All Rights Reserved

Cost of Ownership Unlock Financial Value with better operational decisions and proactive maintenance actions. Ensure optimum effectiveness of planning models using the export tools to Update Planning Yield Vectors. Leverage the benefits of New Technology platforms to provide enhanced usability and sustainability 29 2015 Honeywell International All Rights Reserved

Value Proposition Delivered Core Value Proposition Effectively Track Reconciled Production using PAR s historical reports and dashboards Reduce Losses with in-built in loss accounting capabilities. Ensure Regulatory Compliance with PARs transparency and audit capabilities Maximize Trading Opportunities with Inventory visibility Enhanced Value Proposition Improves margins by up to 25 cents per barrel by ensuring currency of planning vectors Avoid revenue losses due to Meter Biases using the historical meter trending and analyses. Reduce Meter Downtime with proactive meter maintenance alerts 30 2015 Honeywell International All Rights Reserved

Track Production Effective Production Tracking requires that Information is Reliable Easily Accessible PAR provides Inbuilt MTD/YTD Metrics by Material Standard / Custom Production Reports Ability to query Reconciled Production Data into Excel Integration to Enterprise Dashboards Email Notification for Balance Closures MTD/YTD Metrics Inventory Trend This is an example of the Net Production Report, one of many reports available Simpler and Reliable Methods to Track Production 32 2015 Honeywell International All Rights Reserved

Ensure Regulatory Compliance PAR supports reporting and reconciliation standards described by the AMIRA P754 Metal Accounting Reconciliation Code of Practice and Guidelines Supports the information transparency, auditability and availability requirements of Sarbanes-Oxley. Audit Log What was changed, by whom & When Loss Detection From an Emissions reporting perspective PAR supports tracking of Accounted and Unaccounted Losses Robust Support towards Regulatory Compliances 33 2015 Honeywell International All Rights Reserved

Maximize Trading Opportunities Traders must know inventory positions accurately to be able to hedge effectively. Today, this can be a suboptimal unreliable process. PAR provides easy access to inventory information with multiple views that reduces the uncertainty, leading to enhanced confidence for making trading decisions. Interactive Inventory Metrics Reports Excel For a 200,000 BPD of refinery, a saving of 10 cent per barrel = $700,000 per annum 34 2015 Honeywell International All Rights Reserved

Reduce Losses Accounted or Known Losses Model Accounted Losses Presents clear distribution of Accounted Loss Overall Losses Unaccounted Losses Identifies the Unaccounted Losses enabling targeted initiatives Accounted Losses Tons % Tank Evaporation 197 0.32 Flares 226 0.38 Refinery Liquid effluent 12 0.02 Process Fugitives 95 0.16 Cooling Towers 10 0.01 Total Accounted Loss 540 0.8% UnAccounted Losses 1100 1.8% Total Loss 1640 2.6% 35 2015 Honeywell International All Rights Reserved

Update Planning Yield Vectors Planning Yields Drift Over Time Catalyst activity changes Process problems PAR 200 RPMS 500 This leads to Sub-Optimal Decisions such as: Refinery running against wrong constraints Bad feedstock selections Purchasing unnecessary blending components, Making an uneconomic product mix PAR supports industry best practices to periodically capture reconciled plant yields and use them to update planning vectors. Reconciled Data Export To Excel Excel Regression Function To generate Yield Vectors Update Yields Using RPMS Fast Import Improve margins upto 25 cents per barrel* 36 2015 Honeywell International All Rights Reserved

Identify Meter Biases A bias or a drift in Custody transfer meter will cause undetected loss in revenue PAR 200 provides an easy method to view historical trends between the raw and reconciled values to detect bias or drift conditions Timely intervention in correcting these meter defects can help save thousands of dollars in lost revenue Clicking on a stream presents a historical trend of Raw and reconciled values. In this example, the positive meter bias has been identified and corrected. Avoid Revenue Losses due to biased meters 37 2015 Honeywell International All Rights Reserved

Reduce Meter Downtime Meters can run with bias/drift for a period of time without breaking down. Reconciliation tracks meters with frequent significant adjustments, a proven indicator of meter calibration or operational issues PAR provides a Bad Measurement Report that identifies potential faulty meters Systematic usage and follow-up based on this technique will result in improved instrumentation quality. Best Practice to Drive Instrumentation Maintenance Program 38 2015 Honeywell International All Rights Reserved

Value Proposition Delivered Core Value Proposition Effectively Track Reconciled Production using PAR s historical reports and dashboards Ensure Regulatory Compliance with PARs transparency and audit capabilities Maximize Trading Opportunities with Inventory visibility Enhanced Value Proposition Reduce Losses with in-built in loss accounting capabilities. Improves margins by up to 25 cents per barrel by ensuring currency of planning vectors Avoid revenue losses due to Meter Biases using the historical meter trending and analyses. Reduce Downtime with proactive meter maintenance alerts Increase Production Reconciliation accuracy to help deliver margin improvement of up to 5% through better business decisions 39 2015 Honeywell International All Rights Reserved

Illustrative Summary Quicker benefits from PAR due to faster adoption by Customer Workforce Benefits from PAR are Sustainable Sustained Business Benefits through Smart Operations 40 2015 Honeywell International All Rights Reserved

Discover Production Accounting with Confidence Challenge Solution Benefits Ease of USE Integrated graphical workflow environment and best in class reconciliation solver helps close balances up to 20% faster Data Collection Model Maintenance Cost of Ownership Ensure quality data delivery with standards based, performance optimized data access methods Intuitive features reduces maintenance and learning time by up to 20% ensuring sustained delivery of benefits Reduce Total Cost of Ownership by up to 10% by unique combination of technology and locally available world class support. Increase Production Reconciliation accuracy to help deliver margin improvement of up to 5% through better business decisions 41 2015 Honeywell International All Rights Reserved