Professional Documents
Culture Documents
Crude
purchasing Crude freight cost reduction
Integrated
optimization of all the refineries Buying of products from competitors quality giveaways
Primary
freight Retail LPG I&C Aviation
Depot
rationalisation Inventory management
Secondary
freight cost reduction LPG I&C Aviation
Reduction in
MANUFACTURING
IT&S
MARKETING
MUMBAI REFINERY MR
KOCHI REFINERY KR
NUMALIGARH REFINERY NR
Design principles
Objective is to maximize BPCL overall contribution - focus on end to end supply chain: no silos Teams works closely with individual business units to come up with tailored solution Focus on quick, near term action .
Crude cost
(dependant on supply, demand), freight and import tariff
Products produced
dependant on refinery configuration
Supply Chain
Optimization Department to optimize based on Crude cost Optimal production Product distribution plan
Configuration
comprising of two or three crude distillation units and downstream facilities Different flexibility in processing crude
Product placement
dependant on marketing margin, logistics cost, customer incentives
SCO is using PIMS for both refineries to evaluate crude oils which was earlier done on standalone Excel based yields and also for preparation of optimum production plan
Purchase crude jointly Use existing approach Buy crude for existing throughput cheaper Use D GRM for spot crudes Use forward prices for all crude Modify decision making tools Increase demand forecast accuracy Change term spot crude ratio
4
Focus area
Use netback prices in the model Increase marginal contribution Relax the constraints on the I&C products
2
Relax I & C constraints
1
5
SCO Objectives
1
Demand Planning
and review
6
Inventory Management
set norm, review
5
Monthly Distribution Plan
execute and review
2
Crude Evaluation, Selection & Nomination
3
Refinery Monthly Plan,
execute and review* (crude, product, shipping)
4
Product Exchange Plan,
- execute and review
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Planning Demand Demand Planning Refinery Planning Crude Purchase Crude evaluation Product exchange Inventory mgmt Review Creating Demand Retail I&C LPG, Lubes, Aviation Meeting Demand Production Crude Purchase Logistics
X X X X X X
X X X X
X X
X X X X X
X X X
X X X X X X X
Finance
IT
Others
X X X
X X
Note: Marketing includes Retail sales, Industrial & Commercial product sales, Aviation, Lubricants; IT = International Trade
SCO has recognised that it works in a matrix which has three key implications for an organization
Different units with different goals; SCO maximises overall economic benefit
SCO NCR maximisation for overall corporation benefit (bottom-line impact) Refinery International trade (crude procurement) Industrial product sales
Eg. 1 Cr savings from loading 7 days late (as quote on 2nd lower than 7 days before)
Impact of decisions
Vs
Vs
Vs
SCOs four pronged strategy to manage attendant complexities and drive successful transformation
Simple Integrated Business Process Clearly documented and communicated Business Process
Technology
Line of Sight
People
Integration
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Input
Crude oil availability PIMS model - Refinery units - Product specifications - Blend mix - Crude oil assays
Output
Optimum crude mix and product slate
Refinery capacity
12
PIMS Model Enhancements Streamlined for actual Refinery configurations In Refineries for all CDUs assays are generated and updated. Secondary units yields (delta vectors) updated and tuned Actual ATF processing constraints configured. The PIMS models (MR/KR) updated for all crudes in the BPCL basket. 6 version upgrades for PIMS model so far. Model Audit and assessment arranged and executed with the expert consultation from Aspen (160 man-days) Technology Upgrades (In-house) Migration to Latest Version PIMS 2006.0 Crude Manager- Spiral 3.5 Purchased Crude Oil database for all regions from M/s Chevron and standardized as a reference database in BPCL
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Process
Demand forecasted for 3 months Time series based forecast at all levels with judgement
input for correction
100% compliance with clear timelines Demand tree available in the system Monthly variance calculated at all levels and reported Sales own forecast
3 Accountability
Central 4 support
Maximise NCR
Annual supply availability HS : LS = constrained by SO2 emission (MR) / Crude sulphur (KR)
ICPM PIMS
model used
Flexible
Refinery unit availability Other inputs Crude prices
Throughput
Maximise NCR
ICPM PIMS
model used
Flexible
Refinery unit availability Other inputs Crude prices
Throughput
Annual supply availability HS : LS = constrained by SO2 emission (MR) / Crude sulphur (KR)
ICPM PIMS
model used
Flexible
Refinery unit availability Other inputs Crude prices
Throughput
Crude Optimisation
Refinery Monthly Plan 1. Inputs on demand 2. IT inputs 3. Refinery Scheduling 4. PPG workings
M1 M2 M3
Fortnightly plan
F1 F2
Crude Nomination
Cargo nomination Crude blend
Spot/Semi term
Fortnightly plan
F1 F2
Value Based Product Exchanges Plan - Consolidation of strengths & protecting our weakness on Euro-3 Grades
Movement Plan drawn with overall Corporate interests - Well defined Objective Function of Revenue Maximization - Maximum Utilization of Own Pipelines
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FMDP/Exchanges
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Inventory Management
To set location wise inventory norms, using statistical tool Objective to maintain optimal levels of inventory and release blocked working capital Every fortnight, the overall inventory being reviewed with Logistics for taking corrective actions Export plans can be drawn based on the supply demand scenario and the inventory situation.
Basic inputs
actual demand materialized closing stock details. crude and products tanker status landed cost of crude for the month, demurrage, details on past purchases actual production and crude processed data Intermediate Stocks variation, units on-stream data actual RTPs Movement Under-recoveries Info.
Source
Logistics
IT
Refinery
RHQ
Compare plan vs. actual analysis carried out to capture loss/gain Timely and accurate Input data is important
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24
SCO has invested in PIMS linear programming technology, with surrounding modules
Crude oil availability Refinery units Product specifications Blend mix Crude oil assays Crude and Product prices
Constraints
Refinery capacity
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THANK YOU
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Overview
Crude Cost Refinery Config. Tariff Marketing Logistics Protection Margin Cost Marketing Netback Incentives
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PRODUCTS DEMAND
TABLE PPF LPG HNE LNE LNF RIL HNR M91 M90 LAB KZZ SKR SKO MTO AF1 AF2 AF3 SELL TEXT PP FEEDSTOCK LPG HAN, EXPORT LAN Export LAN, FERTILIZER HAN -RELIANCE HAN - REL- COASTAL Metro Euro-3 MMPL MS Euro-2 LAB RELIANCE PDS Kerosene Return Kero KEROSENE MTO Tier 1 JET FUEL JET FUEL JET FUEL MIN 0.15 0.00 0.00 0.00 0.39 0.32 0.97 1.35 1.94 1.29 2.03 0.00 0.00 0.13 0.81 0.68 0.19 MAX 0.17 99.00 99.00 0.97 0.42 0.35 0.97 1.61 2.26 1.72 2.90 99.00 99.00 0.23 1.13 1.90 0.19 35,351 35,351 43,866 39,889 39,423 36,147
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VPRICE
PRODUCTS SPECIFICATION
ROW NAMES XSPG NSPG NSUL XSUL XMTB *XRVP XRVI XRSH XARO NARO XPAR NPAR *NN+A NROI *NRON *NMON *'NROI *XTEL *NFSH RESEARCH OCTANE LEAD CON g/LT FLASH POINT DEG F 30
TEXT SPECIFIC GRAVITY,MAX SPECIFIC GRAVITY,MIN SULPHUR WT % SULPHUR WT % MTBE % VOL RVP INDEX RVP INDEX RSH Content ppm AROMATIC CON,VOL % MAX AROMATIC CON,VOL % MIN PARAFIN % VOL PARAFIN % VOL MIN (NAP +ARO) % VOL RON INDEX MIN RESEARCH OCTANE
LNH 0.8
LNF 0.7
0.5
0.05
0.05
0.0130
0.0130
0.045
18 37.08
11 20
10 17.783
10 17.78
10 17.78
10 17.8
14
12 14 65
42
42
40 8.23 95.0 85 7.73 0.15 7.81 92.5 81 7.31 0.15 7.46 89.5 81 6.96 0.15
UNITS CAPACITY
TABLE CAPS TEXT CCRT CAT1 CAT2 CAT3 CCR1 CCR9 CCR6 CCR8 CCRB CCD2 CCD3 CFPU CHVU CVDU CCCU CFCC CMT1 CARU CRD truput CDU I CDU II CDU III CDU I LS CDU I LS CDU II LS CDU II HS CDU II HS Like CDU III HS CDU III HS Like HCU LR to Vac CDU LR to Vac NCDU LR intake Cracker FCC MTBE UNIT AROMATICS EXTR. MIN 0.00 10.50 5.50 9.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1.20 2.60 0.00 2.50 1.20 0.00 0.00 MAX 99.00 14.00 7.00 17.50 99.00 99.00 99.00 99.00 99.00 99.00 99.00 3.80 5.20 9.30 3.50 2.60 0.07 0.70
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1.411 1.411
29088.97 28697.30
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SCO Models
Model
ICPM (PIMS) MR/KR
Type of review
Output review: Review of product slate Input review: - Crude assay/quality - Unit yeilds - Routing ORION - Crude Scheduling Under Implementation Output review: Review of model forecast accuracy Inventory norm Input review: Inclusion of additional parameters for forecasting Input review: Review of model inputs lead time, batch size, demand variability etc. Distribution optimization Input review: Review of model inputs on LPG freight cost, linkages etc. - Bulk Distribution optimization Input review: Review of model inputs on Retail freight cost, linkages etc. DPO Under Implementation Demand planning
Refinery Scheduling