The six-week analysis was aimed at
identifying key components of cost improvements for engineering, supply chain,
and project cost management and controls. The resulting work plan focused on
scope within the Marcellus Shale basin in the Northeastern United States and
was aimed at quickly realizing value from the acquisition.
The implementation of organization, business process and management system
change was completed within 56 weeks. Key elements included:
Supply chain process mapping
- Development of contractor scorecards
- Work breakdown structure mapping
- Cost breakdown structure mapping
- Development of standard modular
gathering compression packages
Key Process Findings
Gathering compressor stations were not being
delivered at competitive costs or cycle times
- There was rework and duplication of effort in
engineering and construction of gathering compression facilities
- Gaps in project cost management and controls
were resulting in overspend and delays in meeting committed
- The lack of an integrated supply chain and
materials management processes and tools resulted in
- Lack of scorecards and KPIs
Optimize capital project development and execution
cycle times and costs
- Accelerate field compression modularization, standardization
and cost reduction
- Streamline development and execution process to
attain sanctioned in-service dates
- The Gathering Compression Integration workstream resulted in an estimated $80 million-plus in long-term CapEx synergy benefits. The two pilot compressor facilities alone will move more than 1 percent of the natural gas in the US.
- The Supply Chain workstream developed highly regarded processes and documentation, which supported a nearly $20 million reduction in surplus materials during the course of the project.
- The Project Cost Management and Controls workstream successfully developed contractor scorecards, standardized cost breakdown structure and work breakdown structure, along with consolidated cost codes resulting in improved process and standardized documentation.