Automation and control projects: the MAC or the EPC rôle?

In response to a recent question at a European press conference, Roel van Doren, president of Emerson Process Management in Europe, explained that Emerson partner with EPCs  (Engineering, Procurement and Construction contractors), and have strong relationships with them, but do not wish to take on the full rôle themselves. This might even be seen as trying to compete with their own customers.

ABB on the other hand have recently described a North Sea project for an automation and control upgrade where they are pleased to take on the responsibility of being the EPC for the whole contract.

Van Doren explains the Emerson approach to project work:

Subsequent to the press conference, van Doren provided a more detailed explanation of their project involvement when operating as a MAC (Main Automation Contractor) on the increasingly complex projects now emerging.

He explains:
“The rôle of the MAC is very much to coordinate the automation aspects of the project, whilst the role of the EPC contractor is to oversee the construction, mechanical and process parts of the project. This includes overseeing the automation element, but this is typically less than 5% of their scope.

“Emerson is not looking to fulfil the EPC rôle in projects. We are very much focused on providing automation solutions to our customers. Indeed, we have vast experience of being the MAC on very large and complex projects globally, including many multiple and mega-size projects. Because of our expanded services capability we will be able to provide even greater support as a MAC to both existing and new customers.

“This is important because process automation touches every part of the process, making it a critical component of a successful project. So much so that major end users now tend to choose the automation supplier as early as possible. By doing so, customers are moving away from the traditional EPC model and moving towards a “PEpC” approach, where:

P= Procure critical packages and front end loading services
E= Engineer
p= Procure the balance (non-critical items)
C= Construct

“Emerson supports the PEpC approach, in which procurement of critical packages and front end loading services (FEL) occurs much earlier in the project lifecycle, prior to project sanction. PEpC also utilises a MAC. This greatly influences key project design philosophies, which affect plant operation and maintenance. It also ensures that the MAC is brought into a `circle of influence’ with the plant owner and the EPC. PEpC is supported by the Construction Industry Institute and studies have shown that it creates an average opportunity for a 10% saving in cost and time.

“For very large projects or train of plants that may have multiple EPCs, such as the one quoted at our press conference, at the INA Refinery, consistency is provided by the MAC, especially when they have the ability to provide more than 90% of the scope from within their own portfolio, as we can at Emerson.

“Emerson is working directly with many end users to provide them with automation technology and services. If required we do sometimes also take responsibility for other scope to support the projects.”

ABB Process Automation Division adopts EPC approach to North Sea upgrade

In a recent press release about a $27m upgrade project won for the safety and automation systems on the Statoil Heimdal platform, ABB advises that they will have “the complete engineering, procurement, construction and installation (EPCI) responsibility” for the project. Following the upgrades, the Heimdal platform will have ABB’s modern 800xA Extended Automation platform as the main control system, adapted to comply with Statoil’s guidelines for workstations layout and design of process graphic.

ABB’s scope comprises a new human-machine interface (HMI) for the control system, control room modifications, simulator, fire and gas detectors, integration of telecommunication in the control room and information management systems (IMS).

“We are upgrading parts of the safety and automation system on Heimdal to contribute to profitable and safe operation of the platform. ABB’s maintenance and modification service solutions extend the life span of installations that have been in operations for a significant amount of time”, said Per Erik Holsten, Manager of ABB’s Process Automation division in Norway.

“We are pleased that Statoil has the confidence that we can deliver this type of service with EPCI responsibility. The agreement strengthens our position as a supplier of maintenance, modification and service of existing fields and confirms our ability to manage complex projects involving all of our core areas: automation, power, telecommunication and instrumentation”, added Holsten.

Today the Heimdal field has reduced its own production and the platform is now primarily a hub in the central North Sea for the processing and distribution of gas. The platform receives gas from the Huldra, Oseberg, Skirne and Vale fields and exports it via Vesterled or Statpipe pipelines for processing. At its peak the amount of processed gas in Heimdal represents 15 to 20 percent of the total Norwegian gas production.

The discussion will no doubt continue in the next issue of the Industrial Automation INSIDER newsletter, due in August: see http://www.iainsider.co.uk

Advertisements

One Response

  1. I think this is an unequal “apples and oranges” comparison, Nick. The ABB project is entirely an automation system retrofit for existing capital equipment. It involves no procurement of major process equipment. and thus the automation fraction of the total project spend would be MUCH higher than the 5% that is typical for greenfield projects where the entire plant is being procured, engineered, and constructed.

    If the automation fraction is 50%, or 75%, or 80%+ of the total project, then it may well make sense for an automation supplier to take on the entire (and much reduced) EPC role. I sincerely doubt that Mr Van Doren’s employer would turn down such an opportunity.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: