Transforming MRO Performance by Value-Added Services
Published on : Saturday 05-06-2021
The success of MRO services providers in time to come will require a unified approach, says Jasbir Singh.
India's refining capacity has shown significant growth for the last two decades. However, fluctuating crude prices and government control over retail prices are sometimes adversely impacting the gross margins of refining companies. The oil companies continue to bolster their margins by process optimisation, minimising other costs such as heavy grade crude procurement, lower utility production cost and above all, a critical area of on-schedule maintenance. This leads to a growing market for refinery Maintenance, Repair and Overhaul (MRO) service companies. MRO is witnessing a steady increase and climbs higher with the availability of more organised service providers measured by higher number of MRO contracts. Diminishing profits due to inward cost fluctuation is provoking refineries to defer plant maintenance, especially during peak demand periods or increased crude oil prices in the international market. MRO contractors’ margins are also shrinking due to the amplifying costs of human resources like skilled labour and equipment used for turnaround maintenance. Under such a situation, MRO service providers are prompted to invest in newer technology that requires reduced-cost resources.
Refinery annual shutdown maintenance is usually overlooked due to long shutdown maintenance time, high costs, and loss of production. The increasing demand of processed refined fuels has increased the requirement of refinery maintenance significantly. The good MRO companies deal efficiently with refineries to meet their expectation of less revenue loss during the steadily growing turnaround maintenance requirement. Refineries across the world mostly in phase of dwindling profits are deferring plant maintenance, especially during peak demand periods or at times of high oil prices. Margins of MRO companies too have been shrinking due to the delays in maintenance and escalating costs of resources used for turnaround maintenance.
Expanded role of MRO regulation for performance
The world’s growing demand for fuel, subsequently creating capacity expansions and the expanding MRO services market are attracting the attention of international regulatory bodies, which results in stringent environmental and quality regulations. Refining sectors are the most regulated industries and these rules are also applied to MRO companies. Furthermore, many of the refineries are ageing; it requires regular and comparatively more maintenance, which in turn creates greater opportunities for MRO service providers. Regulatory directives enforced by international bodies have placed higher emphasis on reduced emissions will also drive the importance for MRO services. The drastic economic downturn due to Covid-19 has decreased the capacity utilisation of refineries, which has in turn resulted in a significant reduction of spending on MRO services. However the oil & gas business has to ensure continuous focus on asset management related maintenance services adopting time saving methodologies by MRO companies.
Predictive maintenance based on intelligent data
Refiners are using plant maintenance software to define the losses incurred due to unplanned outages caused by delayed maintenance. The planned shutdown is being fixed based on software results of equipment performance/deterioration pattern. The increasing demand for quick and right maintenance of refineries has opened up the market to more MRO companies having core maintenance competency. The innovative, time-saving and low cost methods used for maintenance groups gives a boost to MRO companies and their market demand in the global refinery sector. Refineries are focusing on improving efficiencies of fuel production and the attention is on ensuring well-maintained facilities. This increases the importance of turnaround maintenance (TAM) services for refineries which are supported by good MRO companies having good tools and innovative facilities. Refineries are continuously focusing on improving asset reliability/improvement both for the equipment and process. Optimisation of lifecycle cost is driving the importance of solution-based services. The major challenge is in the availability of data from stored real-time information, pulling from the abundance of sensors and better data routers. Engineers are currently sitting with the building blocks to retrieve data, analyse and make use for better processes. A good example of this is seen in the greater use of predictive maintenance software. Predictive maintenance by use of data from various sensors to predict right maintenance needs advance planning. It is helping many industries in their planned maintenance to better anticipate equipment failure and reduce unexpected downtime.
Solution based maintenance
The success of MRO services providers in time to come will require a unified approach which focuses on consistent performance and reliability based models. End users are increasingly looking for optimising their cost by an efficient system of implementing expenditure strategy by cutting down their maintenance expenditures. Their continuous focus is on enhancing their core competencies by training their people to guide the MRO team to optimise its downtime. They look for reliable companies to outsource non-core competencies during shutdown. Continuation of Covid-19 and economic slowdown have a significant impact on the capacity utilisation of refineries. Some may shutdown these facilities, which in turn demand increased outsourcing of non-core competencies to take a safe shutdown and well protected assets. Adoption of asset management solutions provided by MRO companies will lead to extended asset life and in turn reduce the frequency of repair, shutdown maintenance and facility upgrades.
The major driver for MRO is outcome-based service models. Major MRO service providers are currently redefining the MRO service model, capturing big real-time data, analytical tools to understand and integrating with cloud capabilities to devise solution-based services
Robotics support for MRO functioning
Robotics in MRO is becoming more relevant and organisations have started pursuing this in several ways. Robotics is one of the fastest growing concepts adopted with MRO technologies. Robots are presently adopted as an aid to labour for their routine or precision regular tasks. They also have been used to undertake labour-intensive work that poses a safety risk for humans. While the robot is not appropriate for every application, it has potential uses for many requirements for achieving high efficiencies in the MRO functioning. Robots potential uses are increasing as skilled labour is in short supply and also labour costs are mounting up. Companies have started exploring how they can automate the system and use robotic machines to improve system efficiency. MRO companies use robotics for individual parts repairing and machining to intricate inspection activities of components in machines that are otherwise difficult for humans to gain access comfortably. Some companies are deploying robotics solutions where tiny 1cm size robots are designed to crawl through narrow passages for capturing images and sending them back to engineers for diagnostics and troubleshooting. Development is going for miniature robots to remove and replace the defective components of machines. Companies are using automation for inspection tasks but that is restricted to less critical tasks now and moving towards more critical requirements in future.
Role of additive manufacturing
Additive manufacturing (AM) is widely pursued for MRO services using CAD design or 3D object scanners to create 3D printed parts. AM has the ability to print the replacement parts speedily that are strong, durable, lightweight as well as inexpensive to produce. MRO applications in industry reduce the inventory costs for planned/unplanned maintenance. Presently additive manufacturing is being used by larger MRO providers, but not to its fullest potential. AM application is presently used for less critical components and yet to be used for more important/critical components. AM parts are continuously being improved, with new specifications for ease on the next printing. AM parts will quickly become more competitive, time saving and have a high likelihood of reshaping the way of unit maintenance in the long run.
Utilising AR/VR for training from remote location
Training people in augmented reality/virtual reality (AR/VR) is quite practical and cost-effective to implement by MRO service providers. During training the participants see the same images during teaching lessons and they can discuss their views/opinions and collaborate with each other. The trainer is showing an object in that plant at a remote location and describing it, whereas the students are seeing the same image in space and learning together. Students discuss collaboratively, and these methods significantly improve the learning timeframe and efficiency.
Blockchain in MRO: The on-going saga
Blockchain has continuously held its position as a leading technology. Blockchain is becoming a necessity to improve record-keeping, digital twining, faster lease turnover and analysis, while maintaining a high standard of data privacy. High importance given to security functions for using blockchain to create a secure ‘signature’ based data retrieval and access to blockchain ledgers. Management creates preferred lists of individuals in the businesses that would have allowed a blockchain signature, by giving them access to records or data. People outside authority would be unable to access through the blockchain encryption and view the data.
Platform for analytics, AI & ML
For MROs, data analytics gains momentum, leading to development/use of artificial intelligence (AI) as well as machine learning (ML). Developments in data collection and analysis, and its implementation through AI and ML are well accepted. By machine learning, from large stored/collected data, machines learn to recognise patterns changing/improving the result from a variable into predictable output.
Next-generation MRO solutions can help by prompt and accurate service solutions such as:
1. Improving real-time connectivity across multiple systems, enabling engineers to make agile decisions based on real-time data
2. Moving plant maintenance from scheduled or condition-based to analytics-based predictive maintenance
3. Improving productivity gains using automation and digitisation of manual logging of maintenance processes
4. Optimisation of maintenance system by using just-in-time delivery concept of materials
5. Ability to gain performance by insight into historical maintenance data
6. Increased flexibility to quickly adapt regulatory compliance of any process changes
7. Empowering technicians by simplifying their work using mobile aids and virtual assistants from remote, and
8. Reducing potential/expensive delays controlled by improving understanding of maintenance variables, when making scheduling changes in process.
Jasbir Singh is an Automation Expert having long experience in Factory Automation, Line Automation, Implementation Strategist, Business Coach, Regular writer on automation, Artificial Intelligence, Robots/Cobots, Digital Technology, Network Communication, Industrial Internet of Things (IIoT), Wireless Communication, Block Chain and use of advance digital technologies. He has established a long association with Business Houses/large production houses to improve factory automation in their production lines as well as productivity improvement in factories in India and overseas; and in advising and designing the units to transform into digital platforms by use of Artificial Intelligence. Email: firstname.lastname@example.org