Posted: March 20,
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Cost overruns on construction projects have become the norm rather than the exception. According to a study by EY, 64% of complex projects confront higher than projected costs, and 73% encounter delays. An AVEVA panel of experts—AVEVA Global Director of Project Execution Sales Stephen Furze, Founder and CEO of Construct-X Dr. Ted Blackmon, and ProjectAI Founder and CEO Ray Paulk—explains the benefits of taking an advanced work packaging approach. By taking this approach, which enables seamless, efficient project design and implementation, EPCs can avoid soaring project costs and time overruns.
Advanced work packaging (AWP) is an approach to construction projects that systematically breaks down projects into manageable work packages, while taking management constraints into account. With this approach, EPCs and owner-operators have improved safety, reduced costs by 10%, and boosted productivity by 25%. TheConstruction Industry Institute has researched and tested this process with repeated application.
Here are the key takeaways from the panel.
AVEVA threads advanced work packaging capabilities throughout its software solutions.
Watch the full panel discussion to learn more about how advanced work packaging, AVEVA, and its partners can help you efficiently plan and develop your complex projects.
You will get efficient and thoughtful service from Dragon.
EPC in the Oil and Gas Industry Definition: EPC stands for Engineering, Procurement, and Construction. It is a type of contract where a single contractor is responsible for the entire project, from the initial engineering design to the final construction and commissioning. The contractor ensures that the project is completed to the required standards and specifications. Key Components: 1. Engineering: This phase involves the detailed design and planning of the project. Engineers create blueprints, technical specifications, and other necessary documentation. 2. Procurement: This phase includes the sourcing and purchasing of all materials, equipment, and services needed for the project. The contractor ensures that everything is delivered on time and within budget. 3. Construction: This is the actual building phase where the project is constructed according to the engineering plans. The contractor oversees all construction activities, ensuring quality and adherence to the project timeline. 4. Commissioning: Once construction is complete, the contractor tests and commissions the facility to ensure it operates as intended. Advantages: - Single Point of Responsibility: The contractor is responsible for the entire project, reducing the client’s management burden. - Turnkey Solution: The client receives a fully operational facility upon completion, often referred to as a turnkey project. - Cost and Time Certainty: EPC contracts typically include fixed prices and schedules, providing cost and time certainty for the client. - Quality Assurance: The contractor is incentivized to deliver high-quality work to avoid penalties and ensure project success. Challenges: - Complex Contracts: EPC contracts can be complex and require detailed documentation and clear scope definition. - Risk Management: The contractor assumes significant risk, including cost overruns and delays. - Coordination and Communication: Effective coordination and communication among various teams and stakeholders are crucial for project success. Applications: EPC contracts are commonly used in large infrastructure projects such as oil refineries, gas processing plants, offshore platforms, and pipeline construction.
Feed phase of Oil and gas project. **Front End Engineering Design (FEED): A Crucial Phase in Project Lifecycle** FEED is an essential phase in project development, bridging the gap between the Conceptual Design or Feasibility Study and the Engineering, Procurement, and Construction (EPC) phases. It focuses on refining technical details, estimating preliminary costs, and addressing potential challenges before the full-scale construction begins. Key areas of focus during FEED include: 1. **Detailed Design and Specifications**: In-depth structural, mechanical, electrical, and instrumentation designs. 2. **Feasibility Studies and Risk Assessments**: Identifying technical hurdles, environmental concerns, and safety issues. 3. **Cost Estimates and Budgeting**: Establishing initial investment requirements, covering materials, labor, and overhead. 4. **Project Scheduling**: Creating timelines for the EPC phase based on FEED data. 5. **Procurement Planning**: Preparing for the acquisition of materials and services during construction. FEED is often contracted out to EPC contractors like Chiyoda through competitive bidding. The outcome is a comprehensive FEED Package—a collection of documents and technical drawings that guide the EPC contractor during execution. This package is key in determining final costs, logistics, and further contracting during the EPC phase. Client involvement is crucial during FEED to ensure that the design aligns with project goals and requirements. Close collaboration between the client and EPC contractor throughout the process helps mitigate risks such as cost overruns and delays, especially in complex projects like Liquefied Natural Gas (LNG) plants, where the FEED phase may extend over a year. In conclusion, FEED lays the foundation for a smooth EPC phase and is a critical step in the successful execution of large-scale projects. Regular communication and alignment between all stakeholders are essential to meet project objectives, timelines, and budgets.
Project Life Cycle in the Oil and Gas Industry The oil and gas industry involves a project life cycle with several key phases. Each phase plays a crucial role in ensuring the success and safety of the project. 1. Engineering Phase This phase involves the planning and design of the project. Engineers develop technical designs and conduct tests to ensure they meet safety and functional specifications. This process often requires several iterations to achieve satisfactory results. 2. Phase In this phase, the required materials and equipment are purchased. The procurement team is responsible for budgeting, selecting vendors, and signing contracts. They ensure that the materials purchased meet the technical requirements of the project. 3. Construction Phase The construction phase is divided into four stages: Planning: Developing the project, including land and cost assessment. Pre-Construction: Preparing documents and appointing professional teams. Construction: Carrying out physical construction according to the plan. Closure: Completing and handing over project documents to the client. 4. Installation Phase This phase involves installing systems and equipment, including piping and electrical systems. Installation ensures that all components function correctly before final testing. 5. Commissioning Phase This phase verifies and confirms that all systems are functioning properly. The main focus is on critical facilities such as power generation and safety systems. The project is tested to ensure it meets specifications before it starts operating. 6. Operation Phase This phase involves operating the project or refinery throughout its lifespan. It is the longest phase and includes monitoring performance and safety to ensure ongoing and profitable operations. 7. Decommissioning Phase This phase occurs when the project is no longer operational or profitable. It involves removing facilities and reclaiming materials that can be reused, with attention to safety and environmental regulations. Want to learn more about oil and gas? Join our free podcast! We have episodes three times a week; just sign up to find out what topics are coming next! ???? https://lnkd.in/dF6zvzXH #offshore #onshore #oilandgas #oilandgasindustry #oilandgasmalaysia #offshorejobs #offshorelife
Expert EPC Solutions for O&G Facilities Delivering top-tier Engineering, Procurement, and Construction (EPC) services for Oil & Gas (O&G) facilities, we are your trusted partner for end-to-end project execution. From design to delivery, we ensure every stage is managed with precision, safety, and efficiency. Engineering Excellence: Our experienced team provides comprehensive engineering services, including detailed design, feasibility studies, and technical analysis. We ensure that your O&G facility is optimized for safety, performance, and regulatory compliance. Procurement Expertise: With strong vendor relationships and global sourcing capabilities, we handle the procurement of high-quality materials and equipment. Our procurement strategies focus on cost-efficiency while meeting the stringent requirements of the O&G industry. Construction Mastery: From site preparation to facility erection, our construction team ensures timely and safe execution. We manage all aspects of construction, including civil works, mechanical, electrical, and instrumentation installations, with a focus on minimizing downtime and maximizing operational efficiency. Turnkey Solutions: We offer complete turnkey solutions, managing your project from concept to commissioning. Our EPC approach guarantees streamlined communication, reduced project risks, and a seamless transition from the construction phase to operational handover. HSE Compliance: Safety is our top priority. We adhere to strict Health, Safety, and Environmental (HSE) standards to ensure a safe working environment throughout the project lifecycle. Tailored for Your Needs: Whether you’re developing upstream, midstream, or downstream facilities, our solutions are customized to meet the unique demands of your O&G project, ensuring operational efficiency and long-term reliability.#asasllc #adnoc #construction #contracting #subcontractors #consultants #gas #oilandgas #oilandgasindustry #oilfield #oilindustry #lubrication #oil #watertreatmentplant #waterindustry #wastewatertreatment #chemical #waterindustry #pipeline #structural #offshore #onshore #project #work #projects #testing #team #sustainability #development #planning #design #sustainable #contractors #engineering #quality #network #safety #projectmanagement #compliance #maintenance #qualityassurance #concrete #experience #projectmanagers ???? www.asasllc.com
LSTK stands for Lump Sum Turnkey. It is a type of contract commonly used in large-scale construction and engineering projects. Under an LSTK contract, the contractor agrees to deliver a completed project for a fixed price. This means that the contractor assumes responsibility for the entire project, including design, procurement, construction, and commissioning, while the owner or client pays a single lump sum amount for the finished project. The key features of LSTK contracts include: Fixed Price: The total project cost is agreed upon upfront and usually does not change, unless there are significant changes in scope or unforeseen circumstances. Turnkey Delivery: The contractor is responsible for delivering the project in a ready-to-use state. This can include everything from design to the final operational handover. Risk Allocation: The contractor typically assumes most of the risks associated with cost overruns, delays, and technical challenges. LSTK contracts are often used in industries such as oil and gas, power generation, infrastructure, and large industrial projects.
LSTK stands for Lump Sum Turnkey. It is a type of contract commonly used in large-scale construction and engineering projects. Under an LSTK contract, the contractor agrees to deliver a completed project for a fixed price. This means that the contractor assumes responsibility for the entire project, including design, procurement, construction, and commissioning, while the owner or client pays a single lump sum amount for the finished project. The key features of LSTK contracts include: Fixed Price: The total project cost is agreed upon upfront and usually does not change, unless there are significant changes in scope or unforeseen circumstances. Turnkey Delivery: The contractor is responsible for delivering the project in a ready-to-use state. This can include everything from design to the final operational handover. Risk Allocation: The contractor typically assumes most of the risks associated with cost overruns, delays, and technical challenges. LSTK contracts are often used in industries such as oil and gas, power generation, infrastructure, and large industrial projects.
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