Invensys without the rail business

Invensys presented their “End of Year” results in a press conference this morning. Yes, financial results like you might expect, ie pretty much the same as last year, but what else came out of the presentation, describing their new business outlook? I present my impressions.

The change of emphasis was of interest. Invensys is now without the Rail business: no comment was made about the possible use of the Triconex type safety systems in railway systems, which I seem to remember was a feature last year.

The Group last year had three divisions, and a divisional structure. Mike Caliel came back to Invensys as a divisional ceo, in charge of IOM. Now the group, or the company called Invensys, has three lines of business, sorry, four lines of business, but there is no “Divisional” structure, because that produced divisional overheads. These overheads need to be seen to have been cut out. Mike Caliel is now absorbed into the Invensys HQ staff. What happened to Chris Lyden then?

Wayne Edmunds, ceo, says that everyone gets a facelift from this – although 500 divisional staff jobs will go, out of the 1000 staff reduction.

Four LOBs

The “Lines of Business” are Software, Industrial Automation, Energy Controls, and Appliances. Software is the apparent favoured segment, getting the acquisitions, investment, etc, because of 10% pa growth rate potential and mid 20% margin that should be achievable. This business is “quite unique”, apparently.

Industrial Automation (IA) has growth in single digits, with a margin in the high single digits, growing to low teens. How have the mighty fallen, was it just last year Wayne enthused about how hardware manufacturing produced the real value for any business?

Eurotherm

Maybe pensioned off into the single digit growth, mid teens margin segment of Energy Controls. But what is wrong with that, with the remote monitoring potential of IMServ, that was, some years ago maybe, developing from the basis of the original SCADA developments, and has good potential now with cloud monitoring and control.

Investments

Yes, there are opportunities for investment. Wayne is focused on the Software segment at the moment, with the example quoted of Spiral Software, and with GBP600m to invest, previously quoted to be planned as multiple GBP50m investments over several years. So he is recruiting an M+A expert, a veteran and a name in the M+A business. Why, when his managers already know their customer’s business, the one they are in? Let’s hope the new veteran understands software, but the role could just be that of a scapegoat, to be sacrificed, rather than Wayne, when the first acquisition goes wrong. A good job for a couple of years, I could try to do that.

In IA the intention is to invest in the existing portfolio, rather than acquisitions. So no new widgets. But an interesting comment from Wayne came out of a question from Barclays: “Mike and his team have been investing in a new line of DCS and safety systems with a far more flattering cost profile”, as part of a cost reduction effort on the present line. Cost reduction is an area for investment in IA.

Next steps

The next press interface is the capital markets day on June 5^th. Wayne suggested that Invensys had some ways to go in how they communicate with the market, presumably meaning analysts, and had the intention to strip away the complexity in their statements and make a much more straightforward interface. Maybe the market was expecting more, but it took a slight dip in the day of the 0900 presentation.

Management changes at ABB

ABB in Zurich has announced that their Chief Executive Officer, Joe Hogan, has decided to leave ABB for private reasons. A date for his departure has not yet been decided. Hogan will continue to lead ABB until a successor is announced, as he is committed to a smooth transition.

“Joe is a great and successful CEO and has done a remarkable job of leading the company through the deepest economic crisis in living memory. ABB today is in a much better position than it was when he joined five years ago,” said Chairman Hubertus von Grünberg. “I know this has been a tough and difficult decision for Joe and the Board sincerely regrets that Joe will be leaving the company.”

Hogan joined ABB as CEO in September 2008. During his time at the helm, ABB has invested about $20 billion to strengthen the company. Major investments have been made in acquisitions and in R&D to help secure ABB’s technological leadership in power and automation.

“Under Joe’s leadership ABB’s competitiveness has significantly improved by investing boldly in measures to drive growth and innovation, and by carefully managing costs,” von Grünberg added.

The comment from Joe Hogan was that “I have informed the board that I have decided to leave ABB. This has been a difficult decision as I leave behind a strong and talented Executive Committee and a cohesive Board whose support I could always count on. I look forward to making a smooth transition with as little disruption as possible to the positive momentum that ABB has established.”

Chief Technology Officer also resigns

Three days later in another press announcement ABB advised that their newly appointed Chief Technology Officer, Prith Banerjee, who joined ABB in 2012, has decided to leave ABB for family reasons. He will be relocating to the United States where he will be taking another position outside the company. Banerjee will leave in the next few weeks, and a successor will be announced in due course.

“Prith has brought new momentum to ABB’s research and development activity,” said CEO Joe Hogan. “I regret Prith’s decision to leave the company. I’d like to thank him for his contribution and wish him all the best for the future.”

PV Inverters from Schneider Electric

Schneider Electric, the global specialist in energy management, is honored to have been distinguished by GTM Research as one of the Top 3 most “Competitively Positioned PV Inverter Companies”, in their most recent research “The Global PV Inverter Landscape”.

“This is a great recognition of the positioning of Schneider Electric as a leading company in the solar power conversion market”, noted Laurent Bataille, SVP for the Solar Business of Schneider Electric. “This ranking of Schneider Electric as one of the leading specialized inverter manufacturers is a reflection of the changes at play in the solar industry. In the new phase of the solar market a few major criteria are now influencing customers’ decisions on their power conversion choices: bankability, global capabilities, competitive & reliable solutions”.

As the solar market goes through a rapid wave of bankruptcies and consolidations, the industry is increasingly concerned about securing the long-term future of installations. Suppliers that can provide that security bring an added value.  Peace of mind is key and not every solar PV company today can offer certainty that spare parts, service and technical support will be continually available over the 20+ year life of a solar installation.  Suppliers that combine long-term security along with reliable designs, efficient manufacturing processes and neatly integrated solution packages are especially valued.

Also critical in today’s global solar market is the ability to ramp up execution and field service capabilities in new geographies.  Comprehensive product offerings that cover the whole electrical and monitoring & control systems and can be deployed globally in a variety of different local environments are essential.  Schneider Electric’s localized PV box that comes with integrated power conversion substations, pre-qualified for all local standards and suitable for local environmental conditions is an especially welcome innovation.

“Schneider Electric is a uniquely bankable PV supplier, with proven global reach and infrastructure and best-in-class competitive and reliable solutions.  We’re excited to be part of the next wave of Solar and our recent project wins in Thailand, India, Canada, France and Japan demonstrate we’ve secured our position as one of the leading PV equipment suppliers”  says Mr. Bataille.

In times of rationalization and uncertainty in the solar industry, Schneider Electric is committed to invest in even better products and Mr. Bataille expects to unveil new product ranges in all segments throughout 2013 and 2014:

“We recently announced the launch of our new best-in-class inverters for the residential and commercial building markets in Grid-Tie or Off-Grid versions (respectively Conext RL, Conext TL in Grid-Tie and Conext SW and Conext XW in Off-Grid). In utility scale we completed our suite of plug and play equipment with a new range of array boxes, the Conext Control SCADA system and new PV boxes with Conext Core XC inverters offering efficiencies of up to 98.9%.”

Yokogawa ally with KBR over ammonia

Yokogawa Electric Corporation and KBR have signed a technology alliance for a fertilizer automation package (FAP) that will form part of the ammonia process technology solutions that KBR offers to its customers worldwide. Under the terms of this alliance, KBR will incorporate Yokogawa’s high value-added process control solutions in the FAP.

The fertilizer automation package will couple KBR’s ammonia process technology expertise with Yokogawa’s know-how of process control systems to streamline work processes, standardize configurations, and simplify product interfaces. Yokogawa will supply the CENTUM integrated production control system, the ProSafe-RS safety instrumented system, and selected solution-based software. KBR will provide know-how for the enhancement of the distributed control system (DCS) configuration and advanced applications used in operation management, performance monitoring, advanced process control, operator training, and dynamic simulation at fertilizer plants. It is expected that this package improve plant reliability, reduce energy, increase capacity and improve operator effectiveness in fertilizer plants. Further consolidation of these functions will reduce lifecycle costs for plant control, automation and management systems. Furthermore, it is believed that this alliance will provide measurable economic benefits and lead to improved process performance at fertilizer plants across the globe.

“This alliance is consistent with KBR Technology’s growth strategy for our fertilizer business,” said John Derbyshire, President, KBR Technology. “We are very proud that Yokogawa has agreed to partner with KBR and we look forward to pursuing opportunities to apply the fertilizer package both in our new and numerous existing facilities worldwide.”

“Through our alliance with KBR, Yokogawa is demonstrating its long-term commitment to providing high quality and innovative technology to the ammonia and fertilizer industry,” said Satoru Kurosu, President, Yokogawa Electric International.

Technology projects for UK nuclear industry

UK Business Secretary Vince Cable, via the Technology Strategy Board (TSB) and other Government departments, has promised GBP18m of Government funding for various projects associated with developing commercial opportunities from technology developments for the nuclear industry: these projects will also bring in a further GBP13m of associated private funding. The projects relate to nuclear decommissioning as well as nuclear plant construction and operation: EDF will be involved in around half the projects quoted. TSB chief executive Iain Gray commented “The support announced today [for such highly-sophisticated and leading edge technologies] will help to develop capabilities in this country. That is good news for the economy because it will help us build a world-leading technology base that can provide solutions around the world as well as here in the UK.”

Dr Adrian Simper, the NDA’s Strategy and technology director at the Nuclear Decommissioning Authority, said:  “We were extremely pleased with the level of interest in decommissioning projects from both established organisations and smaller, newer businesses. Our decommissioning strategy focuses very much on developing innovative technologies through collaborative working, while joint funding initiatives such as this increase the investment potential and provide much broader opportunities for interested partners.

We also welcome the comprehensive nature of the subject areas, covering new build as well as decommissioning, which will enable the sharing and transfer of technologies between the different nuclear sectors.”

By 2030 it is forecast that globally there will be £930 billion investment in building new reactors and £250 billion in decommissioning those that are coming off-line. The nuclear new build programme in the UK alone could generate up to 40,000 jobs at its peak. The nuclear industrial strategy sets out the basis for a long-term partnership between government and industry to exploit those opportunities.

Summaries of the 16 collaborative large scale R&D projects

South West UK

• Devon based SME, Beran Instruments, who successfully completed an earlier nuclear feasibility study funded by Technology Strategy Board, will lead a consortium comprising EDF and the University of Bristol. They will develop an Intelligent Condition Monitoring system for the Nuclear Power Industry that will enhanced plant performance and reduce operating costs.

Project funding: £298,800                   Total project value: £598,000

• A consortium led by Bradtec, an SME based in Gloucester will be partnering with Hyder Consulting, Studsvik, Costain and the University of Manchester to explore the feasibility of an extremely innovative technology relating to graphite management from reactors. This would convert the graphite to carbon dioxide gas which could then be incorporated in a carbon capture and storage scheme

Project funding: £953,600                   Total project value: £1,600,000

• Enabling Processes Ltd, an SME based in Bristol, EDF, NPL, TWI and the University of Southampton, will develop a new, low cost technology for the measurement of residual stress of large nuclear components, based on theoretical modeling and experimental development to replace expensive, time consuming, destructive methods

Project funding: £650,000                   Total project value: £1,081,000

Yorkshire

• Building on the success of an earlier Technology Strategy Board feasibility project, Cybula, a research intensive SME based in Yorkshire, will work with EDF nuclear generation and EDF R&D, on the development of pattern recognition software technologies to improve the efficiency of the monitoring and maintenance of nuclear power plant equipment.

Project funding: £336,000                   Total project value: £694,000

• Sheffield Forgemasters International Ltd (SFIL) is a world leader in the production of cast reactor coolant pump (RCP) for nuclear power stations. Working with TWI and Sheffield University, SFIL will deliver a lower cost, cast solution for the RCP to replace the current forged design. Successful qualification should result in major export orders for the UK.

Project funding: £1,060,000               Total project value: £2,121,000

• Another project led by Sheffield Forgemasters, this time working with Rolls Royce, MERMEC UK and the University of Sheffield, will develop innovative production, simulation and measurement technologies which will produce a full-scale, forged component for the primary loop of a civil nuclear power plant. The aim is for Forgemasters to be one of the first companies globally to produce and achieve mechanical properties on such a newly designed component.

Project funding: £1,098,000                Total project value: £2,195,000

• Tata, Siempelkamp and the Nuclear Advanced Manufacturing Research Centre in Sheffield, will be developing an innovative materials technology which can be applied in nuclear waste storage vessels. The resultant technology will produce intellectual property for an alternative manufacturing production method for waste storage.

Project funding: £267,800                   Total project value: £534,000

South East

• Laing O’Rourke, major partners in the construction of the Olympic Stadium and based in Dartford, will work with a consortium comprising Arup, the Building Research Establishment and Imperial College to optimise the design for manufacture and assembly of large preassembled components for construction in new nuclear power plant.

Project funding: £999,000                  Total project value: £1,998,000

• A project led by Micron Semi-Conductors an SME based in Sussex, partnering with Schlumberger, Solaris Photonics and Brunel University will develop innovative hard sensors for radiation detection. They will have long term reliability for use in nuclear power generation plants, with potential spin out applications in other high temperature industrial applications.

Project funding: £846,000                   Total project value: £1,346,000

North West

• C-Tech, an innovative SME based in Cumbria who successfully completed an earlier nuclear feasibility study funded by Technology Strategy Board, will take their technology to the next stage with NNL as a partner. The project will develop the technology to manage the effluent produced from current decontamination processes to enable the use of more effective agents and processes.

Project funding: £401,000                   Total project value: £802,000

• Sellafield Ltd, will lead a consortium comprising Smith Engineering, MMI and Leeds University in the development of two innovative modeling and measurement tools to accelerate and optimise sludge waste characterization, separation, transfer and retrieval operations. This will improve efficiency and reduce costs of the waste processing.

Project funding: £592,000                   Total project value: £1,184,000

• EDF and the University of Manchester will work together to develop advanced modeling tools and methods to predict and understand the behavior of key graphite components in nuclear reactors, in order to improve and inform operational and plant management decisions.

Project funding: £470,000                   Total project value: £939,000

• Costain, the International engineering and construction group, working with Tetronics, a global leader in plasma arc systems, will develop a method based on plasma technology that will significantly reduce the cost of nuclear waste treatment. It is proposed to design, build and demonstrate operation of a DC plasma vitrification plant for processing intermediate low level waste.

Project funding: £858,800                   Total project value: £1,663,000

Cambridge

Plant Integrity Ltd, an SME based in Cambridge, will partner with Brunel University to develop a structural health monitoring system for permanent installation in pipelines in nuclear plants. The system, based on ultrasonics will provide continuous monitoring of high temperature components and improve overall plant inspection efficiency.

Project funding: £262,000                   Total project value: £525,000

Gloucester

• EDF, in partnership with the Universities of Manchester and Surrey will evaluate the behaviour of graphite through its lifetime, under the extreme conditions of temperature and irradiation challenges in order to predict and improve lifetime. It could also play a major role in the research and design engineering support for next generation graphite moderated plants.

Project funding: £727,000                   Total project value: £1,480,000

• EDF, working with experts from Imperial College and the Universities of Bristol and Manchester, will be evaluating the impact of the operating environment on nuclear power plant components. The project will explore the use of innovative non-destructive testing techniques to monitor the structural integrity of nuclear components in a highly efficient manner.

Project funding: £1,086,000                Total project value: £2,175,000

OC Robotics Project – Bristol

Included within the portfolio of projects is one under development by OC Robotics a UK SME, based in Bristol. LaserSnake combines two highly innovative technologies, advanced robotics and lasers, to create a safe and cost effective solution for the multi-million pound nuclear decommissioning market. The project will deliver a robust, re-usable robot controlled laser cutting technology that can be applied both in-air and underwater in confined and hazardous spaces to dismantle vessels, support structures, flasks and pipe work.

An initial successful feasibility study into the development of LaserSnake was funded by the Technology Strategy Board and the project has recently received additional co-funding of £6m from the Technology Strategy Board, DECC and NDA to develop the technology to a full-scale demonstration phase, which could lead to the UK being world leading in this technology area. This is the largest single grant ever given to an SME by the Technology Strategy Board.

Led by OC Robotics, the project consortium comprises NNL, TWI, ULO Optics and Laser Optical Engineering. The technology is already attracting significant market interest in the UK and overseas and has considerable spin off potential in other sectors including the petrochemical, military and construction industries.

Honeywell strengthens OneWireless system

The latest news release from Honeywell OneWireless is reproduced below, and will be discussed further in next week’s INSIDER April Newsletter:

 Honeywell has announced the availability of OneWireless™ Network Release 210, which incorporates several new features that make wireless technology easier to deploy and operate, and result in lower deployment and operational costs (quoted to be particularly relevant in large capital projects and in monitoring-only applications – Ed.)

New features in Release 210 include over-the-air field device provisioning and a Gateway General Client Interface (GCI) made possible by the ISA100 standard; and native integration of OneWireless field networks into Honeywell’s Experion® Process Knowledge System (PKS).

“Wireless technology is transforming the industrial landscape and we are trying to make it even easier for end users to deploy and use,” said Ray Rogowski, global marketing director, Wireless, Honeywell Process Solutions. “With OneWireless Release 210, users can benefit from the flexibility and scalability offered by the ISA100 standard while maintaining high performance and reliability.”

With the over-the-air provisioning feature, field devices can now be configured and commissioned without having to invest in handheld devices or needing to perform provisioning locally at the device. The result is faster and less costly deployment and improved worker safety.

The GCI feature, enabled by the ISA100 standard, allows operations to continue using legacy protocols and proprietary applications while making it easier to wirelessly expand those applications throughout the plant.   The GCI also allows third party client applications to communicate natively using proprietary or common field protocols with wireless field instruments over the ISA100 network. Enabling operations to continue using existing applications or protocols eliminates the need to reinvest in additional equipment and new client applications, re-train maintenance and operations personnel, and to provide consistency across the plant.

Examples of GCI implementations include support for the GE System 1 condition monitoring application using GE’s Bently Nevada wSim devices and Honeywell’s OneWireless Adapter that wirelessly sends HART data from wireless HART or wired HART to HART clients.

Integration of ISA100 field device networks into Honeywell’s Experion PKS has never been easier with the new Experion interface. This feature eliminates data mapping, non-value added engineering and simplifies HMI display creation.  It also allows field process alarms to be displayed on Experion’s Alarm Summary to provide operators with the data they need to make decisions. Tight integration with Experion also allows field operators and maintenance technicians to use Wi-Fi enabled handhelds to securely access process data in real-time from the field.

For further details of Honeywell’s range of OneWireless industrial wireless network solutions visit the Honeywell website.

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ABB major contract for Ichthys LNG

ABB has been appointed the main electrical contractor (MEC) for a new semi-submersible central processing facility (CPF) at the Ichthys oil and gas field in the Timor Sea off Western Australia. The order is valued at $15 million. ABB was awarded the MEC contract by the engineering, procurement and construction (EPC) contractor for the central processing facility, Samsung Heavy Industries. When completed in 2016 the CPF will be the largest offshore production facility in the world.

The Ichthys oil and gas field is estimated to contain 12.8 trillion cubic feet of gas and 527 million barrels of condensate, and have an operational life of more than 40 years. Gas from the field will undergo preliminary processing at the offshore CPF to remove water and raw liquids, including a large proportion of the condensate. The condensate will be pumped to a floating production, storage and offloading (FPSO) vessel anchored nearby, from which it will be transferred to tankers for delivery to markets. The gas will be transported from the CPF through an 885 km pipeline to an onshore liquefied natural gas (LNG) processing plant near Darwin, Australia.

The Ichthys oil and gas project will have an initial production capacity of 8.4 million metric tons of liquefied natural gas and 1.6 million metric tons of liquefied petroleum gas a year, as well as about 100,000 barrels of condensate a day at peak. The $32 billion project is a joint venture between Japan-based Inpex Corporation and Total E&P Australia.

ABB was selected for its ability to provide a complete and integrated electrical solution for the entire central processing facility. The solution has an exceptionally compact footprint and comprises a comprehensive range of ABB power products and systems, including high voltage air and gas insulated switchgear, low voltage switchboards, and liquid-filled and dry-type transformers. ABB is also responsible for design, engineering, installation, commissioning and project management.

“We are delighted to have been selected as a principal supplier for one of the largest and most prestigious projects in Australia’s growing oil and gas industry,” said Veli-Matti Reinikkala, head of ABB’s Process Automation division. “Our ability to provide a complete and integrated electrical solution, coupled with our extensive local resources and track record in similar oil and gas projects in Australia, were key to our winning this order.”

This is the second major contract that ABB has been awarded for the Ichthys oil and gas project. In 2012 ABB won orders worth $80 million to supply power technologies and medium voltage drive systems for the new onshore LNG processing plant near Darwin.