Hydrocarbons: An upbeat market

We are bullish about the future of the region’s hydrocarbon, energy and industry sectors, says Ali Vezvaei, president and CEO, Bilfinger Middle East

Ali Vezvaei joined Bilfinger Middle East as president and CEO in August 2017.
Ali Vezvaei joined Bilfinger Middle East as president and CEO in August 2017.

Bilfinger is an integrated engineering and industrial services provider that has been operating in the refining and downstream industry for many decades. The company’s services address the entire asset life cycle, from concept to decommissioning. These include feasibility studies, FEED as well as other engineering services, integrated projects and EPC works around various process packages and all the way to life cycle services starting with advanced maintenance and turnarounds, asset integrity, corrosion solutions, including modifications, upgrades and life extension.

On the more unconventional front, Bilfinger pioneers digital innovations for the process industry, with solutions ranging from creating asset digital twin and predictive and prescriptive maintenance solutions built upon BCAP (Bilfinger Connected Asset Performance). Other solutions in this arena include Industrial Tube — a knowledge-platform, PIDGraph — a next-gen plant documentation, and BMC (Bilfinger Maintenance Concept). The organisation’s digitalisation solutions are focused on cost reduction and optimising overall efficiency.

The core competencies of Bilfinger could be summarised as follows — reducing cost (maintenance and turnaround); optimising engineering process (plant digital twin and PIDGraph); increasing overall equipment effectiveness and reducing plant downtime (BCAP and BMC); and process optimisation and upgrades, including energy efficiency and heat-steam balance.

Challenges, priorities and progress

Ali Vezvaei is the president and CEO of Bilfinger Middle East, since August 2017. Explaining the key priorities for him, Vezvaei says: “We have come a long way and gained good momentum in strengthening our position in the region. The priorities on the one hand and the progress on the other hand were made on three major fronts — first, to address our existing customers with a more integrated offering combining our knowhow and resources across the value chain; second, to address the market white spots relative to some of our specific solutions such as BMC; and third, to introduce new portfolio elements in digital services such as BCAP.”

“With half a century of presence in the Middle East and more than 4,000 dedicated colleagues across the region, Bilfinger is built on a very solid foundation. What needed to be done was essentially to connect a few more dots — integrate regional competence, leverage broad offerings in various market segments and roll out our digitalisation solutions,” adds Vezvaei.

Top in the agenda of Bilfinger is continuing to leverage the company’s longstanding presence in certain countries with very strong localisation attributes in order to develop the customer base. Leveraging the profound knowhow of Bilfinger in maintenance and turnarounds, especially in refining and petrochemicals industry, has been another key pillar of the company’s regional drive.

Looking at how dynamic and competitive those markets are, maximising value from every barrel is absolutely key to success for the operators and that is only possible if productivity and efficiency is well-embedded into the OPEX environment. Providing world-class solutions such as BMC with proven track record in reducing cost and enhancing overall efficiency is therefore at the forefront for Bilfinger in the Middle East.

In the wake of market slowdown in and around 2016, customers held back on projects and later on decided — rightfully so — to benefit from the low-activity market condition and lock in contracts at lower prices. The slower recovery in early 2018, combined with structural reforms in various countries across the region, could not completely quench the market thirst and that is why the industry is still confronted with an ultra-competitive play field in most sectors.

“In addition, increasing local content requirements across board coupled with rising bilateral trade with Asian markets, require a robust strategy to allow more than capital cost to determine the value of the offering. While keeping an eye on all of the external moving parts, it is my job to ensure we continue to attract and more importantly retain talent within the organisation,” Vezvaei observes.

Significance of BCAP and BMC

BCAP is an important solution for the digitalisation of the process industry. It collects all key data of an operating asset from various data sources, including plant’s digital twin, instrumentation and control sensors, IT and OT (operational technology) systems as well as engineering and operational data. The data are then combined and structured, making it possible to carry out intelligent analyses and provide data-driven models. BCAP provides customers with comprehensive Overall Equipment Effectiveness (OEE) analysis, the basis for optimal decisions concerning plant utilisation and development, and lowering operating costs.

“To ensure best-in-class maintenance services, we have brought together and carefully structured the comprehensive expertise we have gained over the course of several decades. The result is a concept that is unique in the industry — BMC,” remarks Vezvaei.

BMC includes 16 special modules and is based on the experience and knowledge from more than 400 maintenance analyses as well as over 100 current partnership agreements where the services are provided. The concept is precisely tailored to the individual demands of the customer and follows two distinct objectives — increasing the reliability of plants while simultaneously optimising maintenance costs. Over a period of five years, the potential for cost reductions is as high as 20% to 30% while plant productivity can be increased by up to 10% under certain conditions.

BMC also ties right into BCAP and enables Bilfinger to provide a holistic solution both related to resources and systems as well as processes and equipment. Where BCAP enables the plant to move from reactive to predictive, BMC with Bilfinger’s integrated industrial and maintenance know-how, drives the process to maximise efficiency. With this, customers not only know what to expect, but also have options on how to deal with it.

Bilfinger is a full-scale engineering and industrial services provider that has been operating in the refining and downstream industry for many decades.

Cost, resources and time involved in digital transformation

Transforming a world-class downstream asset and its associated organisation, like most of the operations in the Middle East region, involves at least three main steps — digitisation, digitalisation and digital transformation.

Digitisation — the connectivity, gateways, data acquisition and building the plant’s digital twin — is rather less complicated, considering the plants in the Middle East are rather high-spec and well-equipped. Even for a less-advanced plant, the basic requirements could be implemented in about 12 months, or less.

Digitalisation — connecting the data lakes, structuring the data and making sense of these — is where data analytics kick in so as to recognise patterns and build data driven models to derive certain outcome. This is a process that goes first to implementation and then real-time operations. Implementation could — depending on the plant complexity — take between six to twelve months. Real-time operations involve more the Artificial Intelligence (AI) learning curve and model precision.

Digital transformation is where the trained human capital (digital workforce) and the digitalised plant interact seamlessly and create value. This is the most complex part and a function of organisational maturity.

We hold innovation as well as R&D activities as key contributing factors to Bilfinger’s competitiveness and market expansion. In recent years, the topic of digitalisation has taken on a significant importance in the market and throughout all Bilfinger group companies. For this reason, a new digitalisation company (Bilfinger Digital Next) has been established to bundle our extensive in-house know-how and competences into an independent and focused set-up. It puts us in a position to react faster and more flexibly to the needs of our customers,” Vezvaei reveals.

“Strategic alliances with Software AG and Microsoft are ongoing to offer our customers a more comprehensive digitalisation bouquet built upon best-in-class products and services. These strategic partnerships improve the integration of networked devices and sensors, allowing Bilfinger to deliver a faster and more extensive analysis of OEE, and consequently more efficient reductions in OPEX and enhancement of plant availability.”

Digitalisation in the downstream industry

“The need for digitalisation in the industry is driven mainly by the pressure to achieve what we call the ‘Best Cost per Molecule’. Once a plant is built, the focus shifts from CAPEX to OPEX. In refining and petrochemicals sectors, the maintenance cost in particular is the third highest item and each dollar of saving there goes directly into the bottom-line,” comments Vezvaei.

That is where maintenance and turnaround become more of a science as opposed to series of activities. Margin quality and growth become more and more intertwined with optimising OEE, resource productivity and the cost of availability.

“This is where the role of Bilfinger digitalisation is more pronounced, as we could add significant value by optimising the OPEX boundaries. Utilising our BCAP and BMC to move from reactive maintenance to prescriptive maintenance, while stretching the boundaries of turnaround, we help our customers improve their OEE, reduce maintenance costs, and increase work productivity,” Vezvaei claims.

“A great example is the work we have done in Münzing’s chemical plant in Germany. The results are very encouraging. In less than a year, the OEE has been enhanced nearly 7% to 9%, while the data quality has increased by more than 20%. This improves productivity and reduces maintenance cost. But more importantly, we could help the customers address bottlenecks across the value chain, which could increase the production capacity. This is where digital transformation enables ‘doing more with less’.”

Asked about the key changes that digitalisation can bring in the refining and petrochemical industry, Vezvaei explains: “The changes will be in many different parts of the eco-system, but if we had to narrow them down to the most important three, I would say, on the CAPEX side, the rise of 4D scheduling and 5D design of mega projects will fundamentally change the way we engineer and construct those assets.”

On the OPEX side, the profound impact of data analytics and AI in life cycle services, real-time inventory management and the connectivity of the greater eco-system, from production to retail consumption, will reshape the traditional ways in which the mega projects were operated. This may bring a new meaning to design capacity and targeted availability.”

“Further integration and energy optimisation, thanks to extensive amount of data available, enabling a holistic operational view at any given point in time allow further utilisation and integration of various streams, whether feedstock rings, or industrial gases loops to deliver lowest production cost at any given point in time,” clarifies Vezvaei.

Integrating the CAPEX with OPEX

“Bilfinger is a full-scale engineering and industrial services provider and at the heart of our strategy lies the delivery of solutions for the entire plants’ lifecycle. Our focus and expertise in both the worlds of CAPEX and OPEX give us the privilege to serve our customers along the entire value chain and support their efforts not only to build things better, but also to run and manage these more efficiently and sustainably,” Vezvaei asserts.

“Starting with the FEED, engineering and then construction, we do cover the full CAPEX range and in doing so, having the profound knowledge of what comes next, we ensure maintenance and reliability aspects are integral parts of our design. Having maintained hundreds of plants around the globe, we are well-positioned to designing and implementing the optimal maintenance solution for the plant, where we continue to drive the same focus on efficiency and cost optimisation, while pushing the boundaries of turnarounds further away. We then add to this our digital capabilities to enhance the overall equipment efficiency and optimise the productivity.”

“In addition to what I mentioned earlier, energy integration (heat and steam balance), upgrade and modification of certain process units, increasing the efficiency of units such as boilers and debottlenecking certain process units are amongst some of the additional services we provide to our customers. All in all, we engineer and maintain their plant performance,” elaborates Vezvaei.

“With nearly half a century of presence in the Middle East and more than 4,000 dedicated colleagues across the region, Bilfinger is built on a very solid foundation,” Ali Vezvaei, president and CEO, Bilfinger Middle East.

Industrial Tube — the AI-powered solution

In major multinational companies like Bilfinger, where there are many areas of profound know-how embedded into the workforce, the challenge is to retain the knowledge and experience accumulated over many decades, despite aging workforce and/or dynamic market place.

Bilfinger Industrial Tube is an innovative software programme — the YouTube of the industrial sector — that enables the workforce with little experience of filming, or editing to make quick ‘how to’ videos that will help teach others specific, niche skills, as a way to capture, preserve and transfer the company’s domain knowledge, which potentially may be lost otherwise.

“We see this penetrating the chemicals, petrochemicals, refining, as well as the energy utility sectors, simply due to the fact that knowledge sharing and workforce development is not industry specific. Any operator will benefit from access to extended knowledge with just a click. The AI-powered solution — Industrial Tube — provides ease of access and also bridges language differences by automatically providing the required subtitle,” Vezvaei states.

The Middle East angle

“For the past several decades, we at Bilfinger have had the honour to be trusted by a long list of our customers. From projects with Borouge, ADNOC Refining and ENOC, to serving SABIC and its various operating companies, to Saudi Aramco, KPC and EQUATE, to the recently concluded maintenance contract with Tüpraş, the list is 50 years long. Just in the last quarter of 2018, we successfully signed an important cooperation agreement with Egyptian Maintenance Company,” declares Vezvaei.

“Bilfinger has been present in the Middle East over the past 50 years, and has built a strong footprint in the UAE, Saudi Arabia, Kuwait, Oman, Bahrain and Egypt. With an operational model that is pivoting on customer proximity and local talent development, the renewed emphasis on ‘In-country Value Add’ is business as usual for us. With investment in our facilities and people with recognised training and development initiatives to address local resources, Bilfinger has for years been in the forefront of these national development initiatives.”

The ‘Train, Hire, Train’ programme by Bilfinger Middle East, which was implemented in Saudi Arabia, has proven to be very successful and the company plans to expand on that. The next initiative that is being developed is the ‘Women of the Future’ digital service centre.

The journey forward

If we could agree that — given the high complexity and conservatism in the hydrocarbon industry — autonomous plants would not be prevalent by 2025; it is safe to suggest that, by 2025, plant digital twin, with real-time connectivity, command and control, will become a reality. There will be integrated prescriptive maintenance solutions that not only provide the predictive and inventory management features but also are geared optimally towards the lowest cost of reliability, having integrated supply, storage and demand into the mix. Thanks to these, turnarounds of the future will be leaner in scope, shorter in duration and longer in intervals,” Vezvaei proclaims.

“There are specific characteristics of the Middle East that make it a strategic market for us at Bilfinger — the focus on enhanced productivity across the hydrocarbon value chain will continue and further intensify; increasing energy demand and the need for enhanced efficiency will reshape this sector; aging assets and the focus on enhanced safety and reliability will drive enhanced digitalisation; and diversification of the industrial space will open new market fronts and create further opportunities for collaboration and growth,” mentions Vezvaei.

“Our strategy is built upon being the customers’ trusted engineering and services partner of choice, helping our valued clients in addressing industrial paradigm shifts, and creating more value from their assets, or reducing the cost of what they currently do.”

“Against this backdrop, and looking at the supporting demographic, we are bullish about the future of the region’s hydrocarbon, energy and industry sectors, and that advanced knowhow and solutions will unlock potential, both for the asset owners as well as the digital eco-system that is formed around them. It also resonates well with the forward-looking visions of the countries’ leadership such as the UAE, or Saudi Arabia,” Vezvaei concludes.

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