Project Management in the Natural Gas Utility Industry

Gil Soto Vice President – OperationsMobile GasFebruary 27, 2013

Sempra Energy Overview

Southern California Gas

Co

San DiegoGas & Electric

Sempra International

Sempra U.S.Gas & Power

CaliforniaUtilities

Global Infrastructure

• 3.5 million customers

• 4,100 square mile service territory

• Largest US gas utility

• 20.7 million customers

• 20,000 square mile service territory

• Gas/Power Utilities in Latin America

• Gas Pipelines in Mexico

• LNG

• US Natural gas infrastructure

• Renewable electric generation

• Southeast gas distribution assets

• Commodity services

► Fortune 500 company ► 2011 Revenues: $10 billion► 17,500 employees serving

more

than 31 million customers worldwide

• SDG&E – Provider of electric and

natural gas services– 3.5 million consumers– 4,100 square miles of

service territory– 2.3 million electric &

gas meters

• SoCalGas– Provider of natural gas

services– 20.9 million consumers– 20,000 square miles of

service territory– 5.8 million gas meters

California Utilities

• Sempra is the largest private energy investor in Mexico

• Operations– LNG regasification– Combined cycle power plant– Natural gas Pipelines– Propane pipeline– Natural gas distribution

• Five natural gas pipelines interconnecting with the U.S.

Sempra International - Mexico

• Luz Del Sur– Electric utility serving

eastern, central and southern Lima

– Over 930,000 customers

• Chiliquinta Energia– Electric distribution

company serving greater Valparaiso and Vina Del Mar area

– Over 610,000 customers

Sempra International – South America

Sempra U.S. Gas & Power Footprint

• Continuous operations since 1836

• Approx. 89,000 customers in Mobile and Baldwin counties in southwest Alabama

• Diversified customer base, including residential, small and large commercial and industrial customers

Mobile Gas

Gil Soto

• 30 years of natural gas distribution experience• Worked many of the different field positions• Worked many of the different manager/supervisor positions• Worked with the Southern Cal Gas Company • Work with the Sempra International group• Currently working under the USG&P group

• And currently working for Mobile Gas• Earned a bachelor’s degree and an MBA• Honorably discharged from the U.S. Marine Corps Reserves• Worked on many company teams, projects and initiatives, not only in gas distribution, but also with IT, labor relations, safety, and many other areas

Regulatory Agencies

U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA)

U.S. Department of Transportation (DOT)• Pipeline and Hazardous Materials Safety

Administration (PHMSA)• Enforcement – Alabama Public Service

Commission, Pipeline Safety Division (APSC)

49 CFR(Code of Federal Regulations) Part 192• Part 192 – Guidelines

49 CFR Part 192

Part 192• Subpart (1970)

A – General B – Materials C – Pipe DesignD – Design of Pipeline ComponentsE – Welding of Steel in PipelinesF – Joining of Materials Other Than by WeldingG – General Construction Requirements for Transmission Line and MainsH – Customer Meters, Service Regulators and Service Lines I – Requirements for Corrosion ControlJ – Test RequirementsK – Up-ratingL – OperationsM – MaintenanceN – Qualification of Pipeline Personnel (1999)O – Gas Transmission Pipeline Integrity Management (2003)P – Gas Distribution Pipeline Integrity Management (2009)

Project Management (Scope)

Basic Main and Service Line Replacement Projects

First item is to create a clearly identified project scope• An average local distribution company job is about 2 miles

(@ 10,560 feet) of mainline with about 150-200 service lines

• Identify requirements for the project• Permits (city, state, railroad. etc.), right of ways, special

materials and equipment, substructure information, project schedule & goals and others

• Special conditions and/or exceptions• Special conditions and or exceptions that may apply

to the project include: inclement weather, work zones/times, environmental issues, and others

Project Management (Resources)

Basic Main and Service Line Replacement Projects (continue)

The second item is to create a resource list• With the information obtained from your project scope

and from past history of other projects you should be able to estimate your need for resources for the project

• Items include: people (company and contract employees), basic and special materials & equipment and others

• As a reminder, most of these folks are working for you on this project, but don’t actually report to you• Communication and relationships are important

Project Management (Budget)

Basic Main and Service Line Replacement Projects (continue)

The third item is to create an estimated project cost• Again, with the information obtained from your project

scope, past history of other projects and your resource list you should be able to create a good estimate for your project

• Create a line item cost sheet even if you will go out to bid for a total price project • Companies use different templates for cost estimating• Some companies allow for a contingency in your

budget• Change orders and approvals

• Create final budget

Project Management (Time Management)

Basic Main and Service Line Replacement Projects (continue)

Lastly, the PM has to create a project plan• The plan should include tasks, schedule and if needed a

critical path• Task – Identify major task• Schedule – How long will it take to complete the task• Critical Path – Identify task that have to be completed

before other task can start • I believe this is where a PM makes a name for himself or

herself• If the PM is involved with the previous steps (scope,

resources, and budget) and has prior experience then the PM should be able to create a schedule and execute the project on time and within budget

• If the PM was not involved in any of the previous steps, it would behoove him/her to get up to speed on the project as soon as possible

• NOTE!!! The Schedule is subject to change and often does

Project Management (Risk)

Basic Main and Service Line Replacement Projects (continue)

Steps for risk management planning• Identifying the risk• Quantifying the risk – assess the probability and impact of

the risk• Respond to the risk – avoid, transfer, mitigate or accept

the risk• Monitor/Control the risk – change of status or the risk

turns into an issue Risk Management associated with the project

• Permits – usually a very long lead time is needed to obtain RR crossing permits

• Materials – there may be a long lead time for special materials

• Equipment – there may be a long lead time for special equipment

• Project Scope Creep – small changes to the project, but collectively are significant

• Schedule – Need to built in some schedule float

Project Management (Tools)

Some identified tools to assist with project management• Policies, processes and procedures• Excel spreadsheets• Microsoft Project• Gantt Charts• Change Orders• Journal• Meetings• Check-In Points• And many others• Final Steps Include

• Complete documentation, obtain sign off for the project, report project results, document lessons learned and thank those that assisted with the project

Project Management

Questions

Thank You