Maintenance Central to Health of Buoyant Fire Security CompanyBy Peter Appleby | Tue, 09/29/2020 - 09:46
Q: How did KDM Fire Systems perform last year, and what drove your results?
A: KDM Fire Systems had a superb 2019 in financial terms, increasing sales by 93 percent and orders by 128 percent. This increase began with the company setting up new contracts and new offices to take care of more PEMEX facilities as the NOC started increasing the breadth of security across its assets.
Prior to 2017, we were mainly focused on one area: PEMEX’s Northeast Marine Region, where Cantarell is located. We have now widened the scope of our interests, taking care of onshore assets, terminals, and gas compression stations among other facilities. We cover the entire offshore spectrum for PEMEX on the public side and Pan American and Eni for the private side. This has produced great results for the company, which has been reflected in the dramatic rise in sales and orders. Safety and the hydrocarbons industry go hand-in-hand; when the industry grows, so do we.
Q: How is the company split between its divisions?
A: Distribution of our products accounts for one-third of the business. Services including engineering, which accounts for another third and general construction, including installation, is also one-third. Certain parts of the business follow a pattern. For example, when we retail and install higher-end applications we usually then provide higher-end services. This is because if a whole installation has to be Class 1, Division 1 – explosion-proof – then everything added is far more expensive and requires installation, supervision and checks from technicians with advanced qualifications.
Q: Where have been the best opportunities for the company onshore and how have you taken advantage to provide a value-proposition to clients?
A: Our focus onshore has been on separation batteries, compression stations, as well as transmissions, distribution, and storage. The main difference between onshore and offshore environments in terms of security is that risk is easier to predict offshore. This is because a platform, while potentially very dangerous, has all of the risk contained within a single compact unit. Onshore assets, meanwhile, are spread across a far larger geographical area and present alternative risks due to the inherent difficulty in controlling who enters and exits the onshore asset. Personnel, including management, maintenance and plant employees come and go from an offshore facility with greater ease than offshore, where due to the nature of the environment, entry and exit points are far easier to manage and risks can therefore be foreseen. This distinction between environments demands far-reaching contingency planning onshore because, for example, there are various fire suppression technologies that cannot be used when personnel are present. This movement of people and assets around a facility is the main problem we have. Facilities are changed, new valves or bypasses are attached, and these will generate new areas of risk.
Additionally, though offshore facilities can appear to be poorly maintained, they tend to be in far better condition than their onshore counterparts. This means that when arriving to an onshore site, we will commonly find a very different facility to that represented in its engineering diagrams. What appears on paper no longer exists the way it was meant to. This means we have to enter and review each site, and check the facility again. It is a very brownfield type of challenge in which we must figure out the connection between the reality of the condition and those shown on the plans so we can then intervene.
When working in legacy facilities, we will typically try to revamp or refurbish as much of the infrastructure as we can. This is because, from a safety point of view, old technologies are redundant. Backward compatibility is not a valuable or risk-reducing safety feature. Being as safe as possible means using modern technologies. Therefore, we will replace content with new panels, new alarms, and new detectors that are smarter, and offer higher compression capacities than legacy technologies.
Q: How has the introduction of advanced technologies changed KDM Fire System’s product offering in Mexico?
A: Fire safety is not a fast-moving area because new technologies and products must be tested for many years before they are permitted to enter the market. Therefore, we typically make improvements rather than replace one technology with another. However, KDM has increased security capabilities through the introduction of more accurate, longer-range sensors that measure up to 75m rather than the standard 55m range. This provides an economic benefit to newly designed areas because fewer sensors are required for comprehensive fire prevention coverage. These new sensors also reduce the wiring and conduits, which are themselves a potential hazard.
Many of the new updates are connected less to the safety tools themselves and more to do with the communication side. For example, a fire panel is typically designed to act by itself. If it detects an immediate hazard, an alarm will set off and the panel will attempt to shut down the hazard without asking permission because time is of the essence in these situations. In a large facility, many panels are needed and they require hundreds of thousands of wires to be connected. KDM has just introduced new panels that offer the same connection with a single wire. We expect to use them in upcoming refurbishments for clients in Mexico.
Q: How has 3D modeling changed the way KDM rolls out protection and how does the company use it as a tool?
A: For new facilities, we typically build a full 3D model. However, the tools chosen will depend on the project and the solutions selected. If we are building a water solution, we use software called AutoSPRINK, which models the cones and predicts how water will move into a building or industrial facility when applied. This is to ensure that the coverage of water is uniform and adequate to the norm.
Brownfield facilities require different solutions and are frequently more complex. We will use 3D mapping with laser measurements taken by robots that generate a cloud of points on an AutoCAD. But most protection in the field for any energy company is not found in highly-sophisticated facilities. Compression stations, for example, are not very complex. But in legacy facilities, with the upgrades and changes that have happened without being mapped, there is less certainty. This requires drilling by hand to make sure that pipes are not being punctured.
Q: As PEMEX remains your major client, how has the company’s intention to develop its priority fields presented opportunity to KDM?
A: As the NOC’s offshore developments are in their early stages, most of the platforms are wellhead platforms (WHP) and are therefore unmanned. They only require a few detectors and do not offer a great business opportunity for KDM. When those WHPs become production platforms, the opportunities will grow, and we will enter the frame. Those platforms should be constructed by the end of 2020 if PEMEX is to meet its plan. The company is excited about the opportunities but is also aware that PEMEX’s plans have moved more slowly than expected. It invested only 4.5 percent of what it had planned to invest last year.
Currently, the business agreements KDM has with PEMEX do not center around the CAPEX side of operations, but the OPEX. This may change in the future, but first PEMEX must improve its sites following years of poor maintenance. As the CSIEEPs contracts begin, companies will start to take over PEMEX’s facilities that have not been maintained. Security must therefore be amended and that is our strongest business opportunity.
This is because KDM is the only security provider that covers the hydrocarbon, fire, and gas industry. Though we have many competitors in different areas, particularly with distribution, but there is no other one-stop shop like us. The hydrocarbons sector of the fire and gas market is a specialized area. We provide services from risk analysis to early engineering, whether it’s a CAPEX project or engineering a brownfield. We then offer procurement of every single piece required for a project. We offer commissioning, set-up and start-up, as well as ongoing maintenance.
Q: In KDM’s experience, how does the NOC balance its cost and maintenance budget throughout its many facilities?
A: PEMEX focuses primarily on costs, though it also considers its breadth of protection. Lower-cost equipment does not mean low quality but it does mean that some of the benefits of high-end protection, such as the infrequency of maintenance, are not there. This is the trade-off. For PEMEX, the immediate cost is reduced and it can therefore enhance protection on previously unprotected facilities.
Q: How does KDM’s Service Center in Ciudad del Carmen differentiate the level of care the company provides and strengthens the service offering?
A: Our Ciudad del Carmen Service Center, which is focused on compression equipment, is situated in the heart of Mexico’s oil and gas industry. It gives us the ability to carry out maintenance more quickly than our competitors who require products to be shipped to Mexico City or to the north of the country. Delays are problematic because facilities cannot be unprotected for more than 24 hours. We typically ship replacement equipment and install it to the facility that needs maintenance. We then take the equipment that needs maintenance, work on it and send it back for replacement. We are able to do this due to our location and are considering opening another service center in Paraiso, Tabasco, this year, which would allow us to be closer to the ports, where all the offshore equipment is offloaded. This then increases our proposition in the offshore market.
KDM Fire Systems is a Mexican retailer, installer and maintainer of hydrocarbon-specific fire protection systems in the oil and gas sector. The company also provides engineering and consultancy services for both onshore and offshore facilities