ethane to ethylene & derivatives · pdf fileethane to ethylene & derivatives 2013 global...

F201102014
Ethane to Ethylene & Derivatives 2013 Global Petrochemicals Markets Summit Engineering & Construction Panel

Introduction
Joe Thompson General Manager Petrochemicals
Jack Stein Business Manager
Poornima Sharma Manager Director,
Technip, Stone & Webster
Global Petrochemical Market Summit | 2 F201310032

Agenda
Engineering / Technical Resources
Equipment and Bulk Material Supply Chain
US Gulf Coast Construction Labor
Modularization
Question & Answers

Engineering and Technical Resources
The EPC industry is meeting the market demand by:
Shifting resources from other business markets
Ramping up global High Value Engineering Centers
Stepping up college hire recruitment
Gaps
Loss of experienced talent due to aging population
Dormancy of US petrochemicals business in the last decade created shortage of technical specialists with required expertise training is under way
F201310032 Global Petrochemical Market Summit | 4

Equipment and Material Supply Chain
Fundamentals:
Fundamental supply and demand will drive finished goods pricing more than commodity pricing
Ample raw material production capacity and current inventories will mitigate input costs
Need to plan and plan to manage a dispersed supply chain

Equipment and Material Supply Chain (contd)
Areas of concern: Shop capacity availability in the USA Gulf Coast ramp up may not be the only issue Growth in the west coast of Canada may influence the US fabrication capacity. Fabricators globally reporting potential shortage of qualified shop labor and
technical resources
Global Supply Chain and Sourcing Mexico Worth paying close attention to Mexico supply base Mexico to be the next China with rapid growth Mexico has reformed policies and labor management NAFTA also applies and may offer benefits Mexico is positioned ideally to serve both North and South American continents

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2014 2015 2016 2017 2018
(Cra
ft) T
hous
ands
Gulf Coast Craft Labor Demand Above Normal
Gulf Coast Project Investment: $193 Billion Feasibility Studies / Economic Evaluation = $122 Bil Under Permitting / Pre-FID = $48 Billion FEED / Detailed Engineering = $12 Billion EPC Awarded / Construction Mobilized = $11 Billion
Feasibility Studies / Economic Evaluation
Under Permitting / Pre-FEED
Bechtel Craft (Awarded)
EPC / Construction Mobilized
Detailed Engineering
Bechtel Craft (Firm Prospects)

Where Business Begins with Peoplewww.alpharesources.net
Footnotes:563 Identified Work Scopes All IndustriesGulf Coast requires 67% of craft resourcesOutlying Regions require remaining 33%
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12580
1725
12598
8618
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6180
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10339
1380815
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9431
10877
5908
3542
9386
11712
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3017
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Contractor Turnaround Craft Demand Forecast
Forecast Data as of 06.25.13Graphed Time Period 08/02/10 - 12/31/13
Gulf Coast Turnaround Craft Demand
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Craft Key Employer of Choice Success Factors
How craft team members are treated (dignity & respect)
Establish job site work rules (fair, firm & consistent enforcement)
Mgmt. & supervision engagement (meet & greets mornings / handshake & thank you in the afternoon)
Leadership presence in the field (being approachable)
LEADERSHIP / CULTURE FACILITIES / INFRASTRUCTURE Abundant & clean sanitary
facilitates (washrooms / lunch tents)
Ample water & ice distribution
Cool down areas / heat stress mgmt. (adjacent to work areas)
Climatized Lunchrooms / tents (plenty of microwaves / vending machines)
Maintaining a clean & orderly site
DEVELOPMENT / EXECUTION Well organized & implemented
construction plan & schedule
Career advancement, sustainability & global opportunities (NCCER training, welding & craft kills, ESL at night & re-imbursement programs)
Keep everyone informed on project
Implement consistent positive recognition program

Modularization Safety Benefits
Less Site Congestion
Horizontal Fabrication Reduces Above Ground Work
Controlled Environment
Fewer Man-Hours
Less Non-Critical Lifts / Bull Rigging
Safety in Design

Competition for skilled labor
Option for performing construction in parallel
Opportunity to hedge current productivity trends
The flexibility to assemble modules in multiple locations to mitigate risk from a singular strategy or operation
The Speed and Responsiveness of module fabricators who can meet the projects schedule without interruption to construction continuity
The optimal Cost of modules, considering shop rates, material logistics, transportation and site erection
Opportunity to deliver lower project indirect costs
Support the focus on Predictable Results
Responsive to market drivers regarding national, continental and global supply of goods and services.
Modularization Business Drivers

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Modularization Fixed
Jobsite Modularization Opportunities
Jobsite Fixed
At peak, 62% of Man-Power at the Module Yard
Indicative Peak Man-Power Plan (On/Off Mod)
Time
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tudy

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1 12 23 34 45 56 67 78 89 100 111 122
Jobsite Fixed At peak, 62% of Man-Power at the Module Yard
At peak, 65% of Man-Power at the Module Yard
Indicative Peak Man-Power Plan (On/Off Mod)
Time
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Transportation and Logistics

Middle East Project Schedules
Numerous projects have experienced completion and startup delays from 3 18 months
Majority of these projects are LSTK and were awarded based on price
EPC contractors are struggling to complete
Do not see this repeated in next round of projects
Global Petrochemical Market Summit | 15

Question & Answers

ethane to ethylene & derivatives · pdf fileethane to ethylene & derivatives 2013 global...

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