Data Integration in the Process Industry

1. Data Integration in the Process Industry SYSTEMS INTEGRATION IT ApplicationsOptimal Performance

2. Transformation in Industry Global Competition Oil Price Volatility De-integration Technology Telecommunications Political Changes Environmental Awareness Ownership Deregulation Integration of Process Controls and Business Systems Trends Strategic Alliances Business Leverage Extended Enterprise Knowledge Intensive Firm Centerless Corporation Shared Services Asset Teams Supply of crude/feedstock Enterprise Resource Planning Information Flow Value Added Planning Knowledge Management Energy Downstream Practice –Industry Trends/Transformation Focus Changes as the Energy Industry Undergoes Change and Transformation. New Ways of Doing Business Will Be Organized Around Information.

3. Challenge to Refining and Petrochemical Operations*Manage out of downturn through innovation and resourcefulness National Petrochemical & Refiners Association (NPRA) Annual Meeting, March 1999 Challenge. • Harsh market environment and fragmentation • Low refining margins due to excess capacity - debottlenecking • Volatility due to revised product specifications • Justification of capital spending • New products and increased capacity • High operating costs Approach • Existing physical configuration of refineries and process plants. Strategies • Joint consideration of desired set of products and crude selection process. (Iterative) • Complexity vs. high-capital refinery or process plant with sufficient margin to support debt. • Relationship to upstream, marketing, and chemicals. • Asset teams, optimization, flexibility, maintenance, energy costs. • Use of Information Technology to enhance Supply Change Management. *Oil & Gas Journal, March 1999

4. Strategies for SuccessRefineries/Petrochemicals • Using Information Technology to support strategic planning and provide solutions for systems integration • Operating Excellence: Balanced Scorecard, Safety, Cost, Reliability, Well-managed Data • Speed/flexibility in responding to market requirements-LP Optimization, Processing Technologies • Economic upgrading of low value streams (Heavy crude and feedstock, intermediates) • Optimization of market balances and margins • Determining the Optimal Performance Target • Strategic Sourcing • Value-Based Planning and Infrastructure • Improving Reliability: Data mining, operating procedures, equipment failure • Optimization of Maintenance Processes

5. Continuously Changing Model of Managing Information Technology* Technology as a business imperative Energy companies’ assets generally are refineries, chemical plants, service stations, and a vast complex of pipelines, terminals and distribution facilities. Information Technology support is critical for maintaining a competitive edge. Every aspect of business is affected by the application of information technology – in efficiency, in productivity, in cost control, and in setting and implementing strategy. Competition requires an ability to continue expansion of manufacturing capability and reduction of costs through continued investment in information technology. Improvements in instrumentation, process control, analytical techniques and access to unit-level "yield" data provide opportunities to significantly expand manufacturing capacity. Business process improvements such as "supply chain" optimization can achieve cost reductions. Inventory management best practices are supported by IT. (Example: Measure actual versus optimum inventory which may be Just-in-time (JIT) with no working capital (product) in tanks) . *Excerpts from paper presented by Robert H. Campbell, Sunoco CEO, Chairman, NPRA 1998-99, Computer Conference (November 1998)

6. Refinery Information Systems and Processes* Process Improvement depends on successfully measuring process performance and effectiveness. Solutions to improve the processes require a strong Information Systems Infrastructure. Executive information systems Competitive intelligence Financial & HRsystems Production management Demand/supply management Crude and Feed management Project management Logistics management Research/ Developmentdatabasesand otherresearchsystems Process control systems Procurement and contract management Refinery information systems Assetmanagementsystems Unit management Engineering management Operations management Marketing management Manufacturing execution Maintenance management EHS Planning and Distribution Knowledge management driving world class teams External resources and knowledgeCross-functional initiatives * Based on PwC model of pharmaceutical industry

7. IT Plan Opportunity ChartOpportunities to Achieve Successful Systems Integration require an understandingof how systems interrelate and which operations provide data to each system. * ACTIVITY LEVEL CORPORATE PLANT AREA/UNIT STAGE OF OPERATIONS R&DManagement RESEARCH &DEVELOPMENT SALES &MARKETING SCHEDULING FEED & PRODUCTMANAGEMENT DISTRIBUTION OPERATIONSMANAGEMENT PROCESSCONTROL QUALITYMANAGEMENT ENVIRONMENTAL SAFETY MAINTENANCE ENGINEERING HUMANRESOURCES MIS FINANCE R & D OrderManagement Field Terminals SALES Supply & Distribution OIL and Product Movement & Mgmt. PLANNING & DISTRIBUTION Supervisory System DCS OPERATIONS Process Operations System LIMS REGULATORY COMPLIANCE Environmental Health & Safety Maintenance Mgmt. CAD Personnel SUPPORT MIS Data Entry Accounting Based on model from Legacy Coopers & Lybrand

8. Significant Developments for Data Management and Process Control InformationTechnology is eliminating data barriers that separate management from manufacturing and streamlining the flow of information. • Business architecture changed to a two-layered model due to new hardware, networks, software and software standards. • Vertical Integration transferring data ownership from the plant to the enterprise. • Evolution of “middleware” as a software that links control and business systems. • New standards for “middleware” advancing systems development and allowing direct transfer of data from business to production systems. • Advances in Object Oriented Programming at the instrument and GUI level. • Availability of modular client-server systems for both real-time plant control and transactional business systems. • Integrated Control and Information Management Systems (ICIMS) to connect maintenance, computer-aided drafting and design (CADD), electronic document management, and plant information systems data, in real time, with business systems such as enterprise resource planning (ERP). • “Execution” or production management layer targeted for software and services. • Computer-based models for lifecycle management (data asset approach to plant design).

9. Integrating Production Management withAdvanced Control Information Objective: To link critical functions of production management and advanced control to achieve Vertical and Horizontal Data Integration…linking complex process control, plant floor automation, and ERP systems to give management ability to make real time critical planning decisions and achieve a competitive edge. Data warehousing environment may provide opportunities for optimizing the total system across the enterprise. Production Management System (PMS): • Five Major Plant Activities: Data Management, Scheduling, Recipe Management, Performance Analysis, Batch Tracking • Scheduling: Integrated with other information management systems • Recipe Management: Integration of recipe modules • Performance Analysis: Process Configuration Analysis • Batch Tracking: Retrievability; Relational Database Links with External Systems: • ERP downloads validated production data from PMS. Advanced Control: • Controls with state of the art process modeling and algorithms • Production rate, product quality, control of transitions (product grade) transitions

10. Production Management System is Interface between Plant and Business Systems Business Systems (ERPs) Major Plant Activities Data Management Production Scheduling Recipe Management Performance Analysis Batch Tracking Links with External Systems Real time Relational Database Control Applications Laboratory Systems Maintenance Systems Instrumentation (DCS, PLC’s, Analyzers, etc.)

11. Batch Process Design and Control Batch Simulation Integration with ERP Process Design and Optimization Process Simulation Synthesis Advanced Visualization Computer-aided Design (CAD) Advanced Process Control Model-based Control Key Themes for Process Control: Integrate Production Management with Advanced Control The emergence of data buses to support centralized engineering and maintenance through entire process control systems will lower engineering and maintenance costs, while increasing plant availability. Open standards will ensure the interoperability of bus systems and control elements. Control Considerations

12. Enterprise Computing Considerations Enterprise Resource Planning (ERP) Supply Chain Integration Document Management Embedded Systems and Applications OPC, Java, ActiveX in Control Devices Windows CE DNS for Manufacturing Open PLC HMI’s for Embedded Systems Enterprise Computing Key Themes for Enterprise Computing: Achieving complete horizontal and vertical integration of systems is goal of ERP. Standardized protocols will greatly aid vertical integration efforts. Key Themes for Embedded Systems and Applications:Link and unify a wide array of applications and reduce the programming costs for embedded and distributed control applications.

13. Key Themes for Control Network Strategies Advanced Control, Mobile Control Devices, Control Software, Ethernet. New developments in standardization, PC-Based control systems, control applications that provide standardized connections to business management systems such as SAP, adoption of Ethernet for process control, and web-compliant control applications present new control areas that require systems integrators to provide unique network strategies and solutions to achieve client goals. Control Network Strategies will focus on: • PC-based Controls • Field buses (to connect controllers to plant monitoring databases) • Ethernet (to connect to CADD and word processors) • Internet • TCP/IP Solutions

14. Asset Management Division of Responsibilities Preventive Maintenance Operator Training Optimizing Supplier Relationships Risk-based Inspections Contractor Productivity Reliability-Centered Maintenance Total Productive Maintenance Contractor Management Cost Reduction Opportunities Results-based supplier relationships Key Performance Indicators Appropriate Software for Work Management and Maintenance Contract Structuring Accessibility to Maintenance Data Key Themes for Maintenance:Results-Based Maintenance Challenge for Maintenance is to develop a relationship with suppliers of services and materials who will provide maintenance cost and reliability improvements, resulting in a “results-based” approach to Maintenance Management. Computerized Maintenance

15. Enterprise Information Technology • Plant Lifecycle Data Management • Plant Lifecycle Management • Computer Aided Design and Engineering (CAD/CAE) • SCADA • Safety • Web-based Engineering • Data Asset Approach • Computerized Maintenance Management System (CMMS) • 3-D Modeling • Real-Time Visualization Enterprise resourceplanning (ERP) CommonData Manufacturingexecution system(MES) Operating controlsystems (OCS) Enterprise Information Technology (EIT) Model requires one-time entry of operating and business management data. Implementing new computer-based models for lifecycle management as cost-savings investments. (Ref: AEA Technology Engineering Software, Hydrocarbon Processing, February, 1999.)

16. Plant Lifecycle Data Management Aggressive Companies in the Process Industry are using information technology strategies around software that supports the consolidation and re-use of plant data over the life of the plant. Integration with IT Systems Conceptual design Plant data models Enterprise IT systems • IT systems at operating control and enterprise levels • Leveraging plant information into operations and maintenance • Middle Layer of Plant Life Cycle Data Management Detailed design Construction Operating control systems Operation andmaintenance • Data asset approach to plant design (Data-centric) • An Enterprise Technology Model Developing IT Systems that Reuse Data Assets at all stages of Plant’s Life Cycle • Systems used for Conceptualization and Design as Integral part of Overall Enterprise IT System • (Ref: AEA Technology Engineering Software, Hydrocarbon Processing, February, 1999.) Life extensiondecommissioning

18. Achieving Both Vertical and Horizontal Integration is the Challenge that Enterprise must meet to achieve Systems Optimization Information Systems needs are in three distinct areas. Business Services Maintenance/ Physical Asset Management Operations/ Production Advanced Process Control • Legal, Accounting, HR, Public Relations • ERP • Hardware and Software Systems • Extension of Horizontal Integration to Vertical • Optimizing Supplier Relationships • Eliminating Defects • Results-based Approaches • Contractor Productivity • Links with External Systems • Production Scheduling Performance Analysis • Recipe Management • Batch Tracking Information Technology Challenges

19. Integrated Control and Information Management System (ICIMS) ICIMS Network Business data or applications server Business Information management system (BIMS) ICIMS Network CAE data or appl. server CADD System Electronic document management Plant document management PC Workstations ICIMS Network Technical Information management system (TIMS) ICIMS Network HVAC facility management systems Real time information systems Laboratory information systems Plant Information management system (PIMS) Links Manufacturing and Business Environments Distributed control system Process control system (PCS) Safety shutdown system

20. Favorable Long term Business Plan Well-defined business and manufacturing processes Aggressive approach to performance improvement Recognize importance of production data Seeks assistance in achieving corporate goals Unfavorable Immediate goals Management will not accept responsibility Will not take risks IT staff not respected No corporate support No IT standards Planning not effective Business Model has Changed from Several Layers to Two Real-time Control Systems Typical Applications Vertical Integration requires thorough planning. Order EntryInvoicing Transactional ERP systems Business planning and services Scheduling Purchasing Execution software and services Receiving Inventory Performance Measurement Document Management Controls systems and services Batch Sequence Control Optimization Planning Factors

21. Multivariable ControlAdvanced control offers increased production rates, lower consumption of raw materials, improved product quality, and reduced transition times. MPCC manipulates process variables to meet ever-changing production demands. Provides validated production data required by the ERP. Constraints Purge rate Temperatures Pressures Levels Manipulated variables Targets Feed rate Multivariable, predictive, constraint control (MPCC) Feed rate Reactant rates Reactant rates Catalyst- addition rate Catalyst- addition rate Feed composition Cooling temperatures Catalyst activity Disturbances

22. Data Mining Requires well-organized information that has been selected, cleaned, and organized for the needs of the specific task. For process optimization and product improvement… powerful tool for quickly extracting valuable information from data.Automatically identifies unknown relationships and patterns in databases. Tools: Regression, decision trees, neural networks, algorithms, Bayesian networks, Markov models. Types of models: Classification, Prediction, Clustering, Association, Sequence Analysis. Categories: Association (unknown relationships) and Prediction (independent variables, nonlinear relationships). Data cleaning & integration Task-relevant data selection Data mining Knowledge Databases Data warehouse Data cube Pattern discovery Applications Production: Process control and optimization, failure and risk analysis, materials design, quality control, scheduling, predictive equipment maintenance. Business: Competitive analysis, revenue management, inventory control, supply chain management. Research: Materials design, technology assessment. Complex Solutions: Requires specialized custom software, mix of methodologies.

23. Recent Trends for Data Managementand Process Control IT Goal: To achieve Vertical and Horizontal Data Integration…linking complex process control, plant floor automation, and ERP systems to give management ability to make real-time critical planning decisions and achieve a competitive edge. Most companies are still not there. Current Trends reflect System Solutions: • Web-based Control Applications (Independent) • Web-based Solution for Improving Plant Maintenance • Control systems that offer standardized connections to business management systems (ERP products) • Asset management systems • Software for integration of horizontal activities such as supply chain management • Advanced process control systems for smaller production units than traditional refining and petrochemical • Advanced systems which integrate processes across the real-time production layer of the enterprise to achieve horizontal integration • Open Standards (PLCs, Field bus, Microsoft, Batch Control) that ensure interoperability of bus systems and control elements

24. Recent Trends for Data Managementand Process Control (continued) IT Goal: To achieve Vertical and Horizontal Data Integration…linking complex process control, plant floor automation, and ERP systems to give management ability to make real-time critical planning decisions and achieve a competitive edge. Most companies are still not there. Current Trends reflect System Solutions: • Linking of Supply Chain Control at all levels with customers and suppliers • Systems integration becoming more Process Oriented • Data mining for process optimization, product improvement, competitive intelligence, business analysis • Unified Data Management and Network Protocols • Standardized Connections and Interfaces; Interoperability • Operating System Hand-held Control Devices (Embedded) • Wide Acceptance of Ethernet to Connect Control Systems and LANs • Integrating Production Management with Advanced Control to Smooth Out Product Quality Variations • Multivariable, predictive constraint control (MPCC)

25. Maintenance Support • Development of Full Life Cycle Cost Analysis and Root Cause Analysis. • Predictive Maintenance Tools and Maintenance Tracking System. • Effective Maintenance Planning can improve productivity by determining the right priorities and efficient scheduling. • Computerized maintenance systems are essential to modern maintenance methods and can be fully integrated with other refinery systems.

26. Optimization: Success Factors for High Performance RAPID OPTIMIZATION IN RESPONSE TO MARKET SIGNALS Solutions support customer management strategies in identifying success factors, responding to market signals, and implementing plans such as the following: • Tight integration between supply, refining and marketing to allow for…a flexible refinery with superior LP re-optimization and strong change-over capabilities. • Strategic LP utilization to identify high value bottlenecks requiring teamwork between operations and engineering to identify low cost solutions. • Improving LP parameters by tracking actuals against those predicted by LP. • Aggressive debottlenecking resulting in extra output to drive down unit prices and provide a competitive advantage. • Solutions that establish performance measures to ensure that benefits are gained. IT Solutions assist clients achieve a high performance company.

27. IT Strategic Planning Services Specifically Tailored for the Energy Industry. IT strategic planning is based on the changing complexion of the energy industry and focuses on enterprise wide strategic priorities: • Information Systems that flow from and support the client’s overall business strategy • Applications such as Data Warehousing to integrate data from disparate systems • Assurance of Availability of “State of the Art” Telecom and IT Capabilities • Enhancement of opportunities for new sources of revenue • Focus on Competitiveness

28. References Hydrocarbon Processing, February, 1999 Oil & Gas Journal, March 29, 1999 Chemical Engineering, November 1997; February, April, May, June 1999 Legacy Coopers & Lybrand Model, 1991 Excerpts from paper presented by Robert H. Campbell, Sunoco CEO, Chairman, NPRA 1998-99, Computer Conference (November 1998) PwC Pharmaceutical Model, 1999