Chasing Value is a continuous process.

1. Chasing Value is a continuous process.

2. Abitibi Consolidated Energy Management System

3. ACI/Energy Management Systema guided tour

4. LPM Graphs TOTAL NET LOAD TOTAL LOAD LOAD BY SECTOR GENERATION

5. Load AGGREGATE

6. IF (Demand) MONTHLY CALENDAR PEAK MONTHLY PEAK ON PEAK

7. TOR (Weather)

8. IF (Actual VS Plan) 7 DAYS LOAD PLAN GENERATION LOAD PLAN

9. Market Demand MONTHLY PEAK

10. IMO Pricing

11. IMO Pricing - Alarm

12. IMO Triggers

13. Natural Gas

14. Crude Oil

15. NG & CO Summary

16. Future

17. Abitibi was able to build this system with internal resources, at a cost of $77,000 • The system was eventually used to determine when to make power (and sell to the grid) vs when to make paper. • Savings from the system were in excess of $1,000,000 in the first year of operation.

18. Real Time Costing at Weyerhaeuser ( Leads to Overall Performance Measurement )

19. Monticello Price Forecaster #2

20. Real Time Performance • Direct cost is just one source of input data • As machine speed increases – • There are more maintenance problems • There are more quality problems • There are more operational problems • The PI System can help gather all of the relevant data for analysis and performance improvement

21. Determination of Paper Machine Sweet Spot

22. Use of PI at CEMEX

23. CEMEX is a growing global building-solutions company that produces, distributes, and markets cement, ready-mix concrete, aggregates, and related building materials … • Operations in 50 countries across four continents. • Annual production capacity of more than 93 million metric tons of cement • Annual production levels of approximately 74 million cubic meters of ready-mix concrete and 166 million metric tons of aggregates. • 66 wholly owned cement plants • minority participation in 11 cement plants • more than 1,900 ready-mix concrete facilities, • 394 aggregate quarries • 258 land-distribution centers • 80 marine terminals

24. The industry’s accelerating rate of change affects the Automation assets; additionally, global competition demands the optimization of the operations using Automation and Control Systems … How To? Eliminate Automation risks due to obsolescence? Preserve Automation Assets and extend their lifetime? Reduce capital requirements? Maximize operational effectiveness? Increase asset utilization? Reduce cost and increase profits? Eliminate information barriers? Empower personnel? Create a collaborative environment? Comply with regulations? Be open yet secure?

25. CEMEX Strategic Automation Plan The CSAP Initiative covers the two bottom levels (Process Control and Real-Time Information) of the typical pyramid describing the information flow … ENTERPRISE LEVEL E R P MANAGEMENT LEVEL Cyber-Security REAL TIME INFORMATION LEVEL Plantwide Information Management System (PIMS) Advanced Process Control (APC) PROCESS CONTROL LEVEL Process Control Systems (PCS)

26. ERP Marketing & Sales Human Resources Maintenance Maintenance Procurement Logistic Advanced Process Advanced Process Quality, Quality, Control Control Operations and Operations and Production Production Statistical Process Statistical Process PIMS PIMS Applications Applications Control Control Quarry & Crushing Raw Milling Pyro processing Cement Milling Packing Process Areas CEMEX Model

27. Better process Productions l Flows l l knowledge Energy consumptions Temperatures l l New operation practices l Energy and material Pressures l l Decrease energy balances l Powers consumptions l Operation & Quality l Feeds Shutdowns reduction reports l l Emissions Increase equipment Preventive maintenance l l l availability Physical and chemical Environmental control l l analysis Shutdown analysis l Receipts Key performance Operation margins l l l indicators Consumptions l Strategic planning l Production reports (daily, l Productions l monthly, yearly), by: Benchmarking between l Sales business units l Plant l Costs Transfers better l Region l l operation practices Product quality l Country l The added value is a better knowledge of our operations by transforming data into information, and information into Knowledge … Data Information Knowledge

28. Benefits from the use of the PIMS System are appearing, as long as we move forward with the implementation; we expect more benefits as soon as more people are trained to use the system … • Less time to collect info: 20% of the time to obtain information and 80% for analysis and conclusions. • Key Performance Indicators in Real Time. • Improved process knowledge. • Ability to convert one of the most powerful corporate assets – data – into knowledge. • Common language for staff and technical employees. • Improved communication across the organization. • Prepare our facilities to integrate Plant Data with Enterprise and Institutional Systems.

29. In conclusion, global companies must be committed to the use and the further development of Industrial IT Technologies; and the PI System is a valuable tool to achieve this objective … PIMS System in CEMEX, based on the PI System, contributes to: Eliminating the barriers between process control system, people, and institutional systems. Integrating information from many sources. Providing a common structure to encapsulate business rules. Empowering people through valuable process and operation information. Documented savings after first year operations $5 million

30. Six Sigma Study on Chip Quality at Irving Forest Products

31. The Opportunity • Reported Problem • Dirt in chip supply • Six Sigma Quality Improvement initiative started • Related problems • Material availability impacting production schedules at the mills • Transportation scheduling problems related to chip pick-up from sawmills

32. Solution • Ultrasonic sensors installed in chip silos and fed to central PI System • Pertinent data brought to one central system • Chip inventories at the sawmills • Production schedules at all mills • Location and status of transportation • Using the new system one person took over the coordination of operations (in place of a dozen people) • All problems solved

33. Quality Improvement at Applied Extrusion Technologies

34. Applied Extrusion Technologies • Largest Supplier of OPP in North America • Sales in excess of $275 Million • Over 500 customers • Over 80 different product groups

35. Business Challenges • Improve Profitability • Over capacity in the market place. • Falling Prices • Rising energy cost. • Record high raw material costs. • Work force reductions. • Increased customer performance demands

36. Improvement Strategy • Use Sigma principles to improve quality and reduce cost within manufacturing. • DMAIC • Define • Measure • Analyze • Improve • Control

37. Identify Financial Opportunities • Pareto analysis identified film profile to be the largest improvement opportunity. • #1 Customer Complaint Category • #1 Internal Quality Reject Issue • #1 Yield Loss • Significant FFU requirement

38. Analysis Applications • Real Time Profile Quality Report (RTPQR) • Real time feedback to operator. • Trigger corrective action. • Enterprise Profile Quality Report (EPQR) • Summarized by mill roll lot. • Customer Fitness-For-Use. • Slitter operator decision support • Process Book Displays • Process monitoring. • PI Profile • Detailed scan by scan analysis

39. EPQR Web Application

40. Real Time Report

41. Pi Profile View

42. Measure Floating Profile

43. Identify Process Variability

44. Project Results • Elimination of root causes for variation. • New insights into interaction between HVAC control and process control. • Losses for profile flatness were reduced by 70% with annual savings of over $300,000 on one line. • Customer complaints isolated to small individual roll occurrences. • Record low Return Rate of .11%

45. Overall Results • PI and F.L.A.T system have now been installed on six lines accounting for over 75% of our production capacity. • Through improvement projects we have driven down internal flatness losses by an average of 50%. • Increased production rates due to the reduction in variability. • Customer complaints and return rates at record lows. • Annual benefits in excess of $5 million

46. Input Cost Reduction at Cascades

47. Electricity 16% Natural Gas 26% Steam Wood 6% 31% Steam Residues #6 Oil 15% 6% Energy Inputs Numbers at Cascades Big Total: 36 MGJ - Big Cost: $500 Million

48. Results from using PI • Energy tracking made more efficient • Reduced time for capturing data and generating reports • More time to work on the processes and find solutions to improve the energy usage • Data is accurate and reliable • Much more data available for analysis • System is Flexible, Customizable and Generic

49. The Bottom Line • The PI System was deployed to monitor all inputs in real time. • Once deployed Cascades expected to reduce input costs by 2% • They achieved 3% within one year and now the target is 10% within 5 years • With input costs of $500 Million per year the annual savings are enormous.

50. Summary • There are 1000’s of ways to derive value with the PI System. • As outlined earlier, results can be enhanced if you follow the examples set by our successful customers. • Stakeholders • Vision • Framework • Infrastructure • Small projects • Publicize results • Enterprise Agreement