Optimize Performance in Uncertain TimesWed, 01/18/2017 - 10:58
Success in a challenging and shifting industry requires many components, one of which comes down to a single word: optimization.
“Given the current industry circumstances, optimization has become a major factor for success in this environment,” says Hernando Gómez de la Vega, President of consultancy R2M.
R2M (which stands for Reliability and Risk Management) has carried out optimization services for PEMEX and is counting on the increased business brought about by the Energy Reform to apply its highly complex stochastic methodology for risk management and asset optimization to oil and gas players, both local and international. The goal is to help them improve performance in a newly opened industry at a time of lingering uncertainty related to a long period of low oil prices, says Gómez de la Vega.
The consultancy can work with NOCs, IOCs and independent oil companies and Gómez de la Vega says that the risks change depending on the individual challenge of each organization. “The risk run by a company that is going to work on a mature field, in which all factors are known, is completely different from the risk run by a company entering deepwater, where there is no information and variables can change,” he says. “The big difference is the dimension of the risk.”
To guarantee the successful optimization of an asset, the company operates over three levels: strategic, tactical and operational. The executive explains that these factors are all interconnected and equally important. “When companies attempt to optimize at a strategic level without accounting for operational and tactical optimization, the results are bound to be disappointing,” he says.
R2M’s tools are based on a multicriteria environment. “When we perform optimization processes, we include various measurements in the analysis like the hierarchization index, which includes profit, investment, production, reserve replacement and risk,” he adds. This approach takes any company’s individual needs into account and assigns the correct weight to each aspect included as criteria.
To apply this stochastic model to oil and gas, Gómez de la Vega takes the example of drilling oil wells. To ensure operational optimization, firstly the oil company must make sure the design of the well is adequate. Then, to address tactical optimization, the sequence of drilling must be defined to strike a balance between the highest level of net present value and lowest level of risk. Last, strategic optimization can be achieved by outlining the strategic objectives that need to be fulfilled, such as increasing production, reducing risk or reducing costs. “This model takes into account production, risk and economic indicators,” he says. “It can also be applied to a portfolio analysis of investment and operations so it goes to the highest levels.”
The methodologies can be applied at different levels, he explains, because they can be adjusted to the complexity of the project. “We can offer reliable engineering and improvement based on common standards, which may appeal to small companies arriving in the market,” he says. More sophisticated tools like stochastic analysis of field development and exploration and optimization tools may be more suitable for bigger oil companies.
R2M can also take existing technology, optimize it and tailor it to individual client needs. “Reliability center maintenance is a very common methodology known worldwide,” he says. “When maintenance plans need to be developed for equipment in a refinery, a lot of time and effort will be required with the traditional approach and often the results are disappointing.” R2M has a specialized methodology for installations like refineries in which the company can develop the entire maintenance plan in six months.
Gómez de la Vega says that R2M has traversed four energy reforms – Venezuela, Colombia, Brazil and now Mexico – and he believes that the Mexican process is bound to be highly successful. “I believe Mexico’s Energy Reform will be the most successful to date because the authorities have used best practices from different jurisdictions.”