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E mpresa Nacional del Petróleo (ENAP) is a Chilean state-owned petroleum company engaged in the exploration, production, refining, and marketing of hydrocarbons

and their derivatives. ENAP has activities in Chile and abroad,

through international affiliate companies in Argentina, Ecuador, and Egypt. In Chile, it operates three business lines:n The Exploration and Production line directs

the tender and subscription of oil operation special agreements.

n The Gas and Energy line manages the gas business and some non-conventional renewable energy projects.

IT’S ALL IN THE DATA

Jaime Rivera, Mauricio Castro, and Pedro Hurtado, ENAP, Chile, alongside Federico Neira, KBC (A Yokogawa Company), Argentina, outline how ENAP has utilised software to improve its decision making in areas including refinery optimisation and production planning.

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n The Refining and Commercialization (R&C) business line operates the Aconcagua, Bío Bío, and Gregorio refineries, where crude oil is processed and transformed into fuel. This line includes sales, supply, and national logistics activities.

ENAP refineries have a joint refining capacity of 200 000 bpd. The company provides 99.3% of Chile’s gasoline, 44% of its diesel, 64% of its kerosene, and 12% of its LPG, with a staff of 3737 workers.

For over four years, the Chile ENAP refineries and terminals have used the Visual MESATM Production Accounting (VM-PA) software. The information processed by this tool has proved useful for the company’s decision-making in areas such as sales and supply, refinery optimisation, production planning, logistics, custody transfer, trading, human resources, and governmental organisations, etc.

BackgroundIn 2013, ENAP set operating goals for the R&C business line to define a balance process within the company supply chain which included planning and operating control management. To do this the company required real, prompt, and traceable information for crude oil and product logistic processes. The solution would be a single tool that supported all of the required functionalities, with state-of-the-art computing platforms plus technical and functional support.

The former situationSince 1993, platforms with local databases supported all the tasks related to ENAP production accounting. These platforms had limited integration with other existing platforms and lacked the ability to migrate to new operating systems.

Monthly volumetric balances made early variance detection difficult and thus, their resolution. Inferred productions were made according to the pre-established model.

Lacking advanced technology, employees carried out tasks in an isolated manner for each functional area without the synergy of process integration. Manual activities in spreadsheets or typed notes were used and shared via email with other areas.

Infrastructure obsolescence, the lack of information and process hardware control were the key decision factors to invest in the project to automate production accounting

Balance processApart from not having a tool to integrate information generated during the different stages, there was no formal standardised process for the ENAP production accounting activity in the supply chain. This project aligned the process implementation with the ENAP’s roadmap using a forward-looking approach. For example, the SAP Oil & Gas new structure, the implementation of Laboratory Information Management Systems, and the Asset Management Maintenance. It standardised

common criteria for the processes needing support and information integration from the VM-PA.

SoftwareENAP required a production accounting platform that would capture crude oil and product inventory movement data as well as integrate into existing systems. It should collect daily data and generate the balances and reports based on data reconciliation for all the necessary areas which allowed the availability of information for:

n The sales and supply processes. n The logistic processes of the crude oil and product

inventories. n The planning and control operating management.

In addition to these requirements, the tool had to satisfy a strict technical, functional, and financial selection process.

VM-PA demonstrated and solved representative study cases. A multidisciplinary team of technology users oversaw and assessed the tests. ENAP administrative, technical, and professional teams from different areas agreed that the software was the best alternative in this process.

Project implementationThe project started in July 2014 and took 2.5 years to complete. It included the software, infrastructure, technology update, technical support model, key users, and incorporation into the company’s information safety model.

The project team’s strategy was to sequentially implement the tool in the R&C business line units. It started at the Aconcagua Refinery due to the logistics of the system provider and proximity to the managerial decision-making at the ENAP head office. This helped the project team gain experience and develop the best business practices in the process.

Production accountingIn the core of the VM-PA systems, there is a mass balance model made up of nodes and connections that represent the entire site. This includes process units, tank storage, a network of multipurpose pipelines between terminals and plants, and all the currents which are part of the movement, purchase and sale of crude oil and products.

The project began with tank balances followed by process unit balances. The team processed and analysed tank variations making decisions on the proper measurement systems. Apart from the data manually entered by operations staff, a series of data inputs feed this tool (Figure 1).

Implementation Between July 2014 and June 2015, the work consisted on the interaction with refineries and terminals operations representatives to build and configure the model. The system went live at the Aconcagua Refinery in December 2015 after a six-month trial phase.

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In May 2016, the team implemented the system at the Bío Bío Refinery. By leveraging previous implementation experience, the start-up – go live stage was completed in two months (Figure 2).

The team implemented the system in Magallanes Refinery in August 2016 followed by the final implementation at the storage plants and oil pipelines (Linares, Maipú and San Fernando) in December 2016 (Figure 3).

This implementation was not exempt from resistance to change by diverse stakeholders. An expert consultancy addressed and solved the situation by providing permanent support and training. This support continues as part of the work routine and permanent improvement by the ENAP Control Direction and Inventory Management. This is mainly in the areas of refinery and terminal operations.

The company areas gradually integrated the production accounting tool in their daily work. They did this by previous comprehensive work and data validation of available information.

Current advancement stateNow, ENAP has daily volumetric and mass balances. As a result of record work and conciliation analysis, there is visibility of profits and losses per tank, product, and location (Figure 4). Jointly with the operation areas, the headquarters monitor the behaviour of these variations and make decisions based on improvements, mainly in measurement systems. Through this system, there is traceability of records and modifications. Differences are verified outside the admissible ranges based on the history accumulated during the 2.5 years of operation (Figure 5).

ENAP continues to identify possible gaps so that the daily balances have a consistency. The multidisciplinary team works together in the measurement systems along the entire supply chain so the company can make decisions based on reliable information.

The company is generating daily off-site volumetric balances at all sites and mass/volumetric balances of process units at the Bío Bío Refinery while implementing the latter at the Aconcagua Refinery. By comparing the typical yields of the latest years and the ones delivered

by design, the daily yields are visualised and help in the identification of potential operating improvements.

A series of data emerges from VM-PA on all the storage points, production and refining, profits or losses, and yields at process units to help in the company’s decision-making.

The areas that particularly use this information are:

Production planningThrough the tool, the Monthly Operating Program is compared daily against the real situation. Deviations are monitored, as well as having the crude oil preparation for load to refineries, gasoline blending at tanks, and the program of daily deliveries and receptions.

RefiningThere are mass and volume balances of process units at the Bío Bío Refinery and an implementation process at the Aconcagua Refinery. Operations can visualise the yields of its plants daily, determine the origin of potential deviations, and reorient them as far as possible.

Sales and supplyThrough the tool, there is information of daily existences at each of the storage points, with the purpose of satisfying the commitments to external and internal customers. This, along with production, allows for the planning of deliveries by the different channels in the short and medium-term.

FinancesAll the crude oil and product movements generated by the (physical) tool are entered into a system to build a database of the production costing process.

Figure 3. ENAP VM-PA implementation points.

Figure 2. R&C trial phase process and production start.

Figure 1. The ENAP production accounting system.

Reprinted from January 2020 HYDROCARBON ENGINEERING

This provides information about existing crude oil and products at the different storage points.

LogisticsThe tool provides reliable information for the purchase of crude oil, product, and logistics, to coordinate the proper logistic channels (land and maritime pipelines) to satisfy deliveries.

MaintenanceThe tool makes it possible to detect mistakes or deviations from the typical behaviour of plant meters, tank gauging, tank meters, or measurement systems as a whole. This allows the team to infer possible problems in the measurement equipment or tank gauging.

AuditThe tool gives traceability of the processed data, and variations analysis to establish roles and responsibilities, and to research detected deviations.

IntegrationThe system integrates into a series of refinery tools. Reports are available online and anyone authorised can view them at any time.

ResultsThrough VM-PA, the multidisciplinary team can identify the crude oil and product flows. As independent variables, the team can identify the daily profits or losses (P/L) by comparing the theoretical final measures against the real or the measured ones. This is then used to detect gaps in the measurement systems to identify the volumetric and accounting variations, and early manageable deviations, and eventually real variations which result from evaporation, leaking, or prohibited outputs.

Detection by mistakesENAP has managed to detect recording mistakes, reclassifications, measurements in a critical area, gauging of measurement equipment and/or tanks, temperature, densities and other variables affecting the balance consistencies.

Water determination control in crude oilThrough the tank balances tracked by the tool, the decanted and drained water of crude oil tanks is monitored. This provides the real water control contained in the crude oil, facilitating the operating decisions and their operating impact through the data.

Reduction of apparent lossesVM-PA detects apparent losses of crude oil and products affecting the company’s income statement. Managed through multidisciplinary committees of variation analysis, ENAP identifies variations and improvement opportunities in the measurement systems, with the final goal of reducing the apparent

losses by adopting early actions and potential technological improvements in this line.

Statistical analysis of lossesWith the tool, daily P/L information by product or tank is used to control losses and to instigate early research into atypical variations as regards the control bands built based on historic data.

ConclusionsThe data produced for production, refining, loads, and apparent or potentially real losses validated ENAP’s decision to use the tool described in this article.

The daily balance information is processed and analysed, verifying the behaviour of profits and losses over time at the tank-product level. Based on output, variations committees are created to account for the deviations outside the allowed control bands, and actions tending to minimise them are agreed.

Now, ENAP has a unique, reliable, and auditable platform, with daily volume/mass balances for tanks/process unit balances. The VM production accounting tool is useful for decision-making in refining, production planning, supply, logistics, costs, finances, custody transfer, and human resources.

Figure 5. ERSA 2017 P/L accumulated behaviour of crude and products.

Figure 4. The profits/losses (P/L) behaviour of a diesel tank between March and June 2018. It can be observed that P/L are mostly within the control bands established based on historical information.