A New way to tackle tricky industrial investment decisions
Neste Oil has many years of experience with handling tank cars, at present about 20,000 wagons are unloaded per year in Porvoo.
“But we have never unloaded this type of crude from tank cars in Porvoo,” says Heikki Tegelberg, HSEQ manager at Neste Oil. “Although it looked like we had invented an easy way to reduce the logistics costs and to streamline our operations, we needed to be sure about the investment’s profitability.”
Tegelberg explains that, for example, the size, model and quantity of tank cars vary from day to day and week to week. Another factor to take into account was the outside temperature, since the crude has a high viscosity.
“To figure out just how these factors would affect the outcome of the project, a lot of different information had to be fed into the model, such as daily temperature changes over several years,” Tegelberg says. “With a normal spread sheet calculating program it would have been impossible to calculate how all these independently changing variables would interact over the year and where the possible bottlenecks would be.”
After seeing the unexpected results of the simulation, Neste Oil decided to postpone the investment.
“The modelling tool clearly showed that the solution we had in mind would not be profitable at the moment,” Tegelberg says.
Extremely flexible
Andreas Frejborg, manager of process calculation and information at Neste Jacobs, explains that the strength of the modelling tool is that it gives the background for investment decisions based strictly on facts.
“It transforms many ambiguous factors into an easy to understand basis for a decision, for or against, as in the Neste Oil case,” he says. In any case, the simulation results help the customer avoid making potentially very costly non-optimal decisions. “We have a track record of about 50 feasibility studies of this kind for tank farms and production units as well as for overall logistics.”
A big advantage of the tool is the possibility to create and feed new variables into the model at any stage of the process.
“This makes it possible to test a lot of different scenarios in a short time,” says Stefan Karlsson, senior application engineer at Neste Jacobs. This allows very efficient streamlining of the original idea and often provides a completely new, more viable option for decision makers. “And the more facts we can enter into the tool, the more accurate the results will be. It is possible to simulate complex processes for sufficiently long periods, in a reasonable amount of time.”
A social tool
Although the modelling service is based on a strictly mathematical tool, Frejborg points out that the service also has many social aspects.
“To get accurate information we need the input of key persons throughout the customer’s organisation,” he says. “In the beginning of a new modelling process, they are all invited to a series of workshops that lay the foundation for the process.”
In many cases, the first workshop is in fact the first time people from different parts of the customer’s organization meet face to face.
“When people realize that the aim is not to judge their individual jobs, the process usually gets up and running and we can begin to throw facts and ideas into the modelling tool,” Frejborg says.
Caption: The rail yard at Neste Oil’s refinery in Porvoo handles 20,000 tank wagons a year. It has the capacity to enlarge its operations, but Neste Jacobs’ modelling tool clearly showed that not all crude is suited to rail transport. ©Neste Jacobs
Neste Jacobs is a preferred solution provider of high-quality technology, engineering and project services for a wide range of industries in the oil and gas, petrochemicals, chemicals and biotechnology fields. The company has more than 50 years of experience in technology development and industrial investment projects as well as maintenance and performance improvement in Europe, North and South America, Asia and the Middle East. In addition to the Nordic countries Neste Jacobs is looking to grow in the expanding markets of the Middle East and Russia in particular. The company employs some 1,000 professionals globally. www.nestejacobs.com
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