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ASSET LIFE CYCLE

 

 

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ASSET LIFE CYCLE - KEY THINGS YOU SHOULD KNOW ABOUT AN AGING FACILITY

August 30,2021

Oil and gas operators are now being driven to now operate beyond their originally conceived design life and field life. Asset life extension (ALE) beyond these thresholds presents unique safety and business risk challenges for the oil and gas industry. With aging equipment and facilities, operators face increasing challenges in maintaining equipment reliability and integrity as well as operational safety.

Aging factors do not only involve hardware but also human and organizational factors. Factors include corrosion, erosion, fatigue, equipment obsolescence, normalization of deviance (accepting degraded conditions as being normal), changes in codes and standards and lack of data to forecast future risks. The challenge is magnified if there is a large fleet or large amount of aging assets that needs to be managed. In this chapter, a responsible approach to ALE, where assets can continue to be operated safely and resources are adequately managed, is provided herein.

Oil and gas facilities range from both upstream and downstream assets to include offshore structures, onshore tank farm facilities. Offshore structures may include the typical fixed offshore structures, monopods, guyed wire caissons to the more complex deep water assets including Floating Production and Storage Offloading (FPSO), Mobile Offshore Production Unit (MOPU), Tension Leg Platform (TLP) and semi-submersible structures (Figures 1 and 2)  

 

Typical offshore structures [1].
Figure 1. Typical offshore structures [1].

 

Typical onshore tank farm facility [2].
Figure 2. Typical onshore tank farm facility [2].

 

Extending operation facilities beyond design life presents safety risks, business risks and operational challenges to the oil and gas industry. These risks affect significant business decisions and need to be quantified and managed as we strive for continuous operations of aging assets. Aging assets and equipment present increased challenges in maintaining equipment integrity and hence, will need to be managed accordingly.

These could be because of a cumulative degradation and risks over time, which includes:

  • Degraded materials of construction due to corrosion related mechanisms;
  • Erosion, wear, fatigue or cracking mechanisms;
  • ‘Slow burn’ degradation mechanisms;
  • Obsolescence of equipment leading to potential lack of spares, high cost of spares, etc.;
  • Normalization of deviance associated with human factors (i.e. accepting degraded conditions as being the new normal);
  • Lack of data trending to forecast future risks to safety and business continuity;
  • Failure to record the accurate status of safety critical elements (SCE) over time;
  • Changes to engineering codes and standards;
  • Loss of technical competence (qualifications + training + experience) in the industry;
  • Introduction of foreign materials into the production systems (e.g. Chemicals for Enhanced Oil Recovery (EOR), downhole sand consolidation, chemical tracers, off spec water injection, etc.);

 

Assets are required to predict and understand the effects of deterioration, or changing conditions associated with life extension and be prepared to intervene to ensure that this demand can be met without adverse effect on asset integrity and safety. Asset life extension (ALE) for a given design life expiry, refers to a condition whereby an asset is approaching its intended design life. The main aging factors that need to be considered when developing an ALE program are material degradation (Figure 3), obsolescence and organizational issues. This is provided within Figure 4.

 

Degradation of offshore structural component [3].
Figure3. Degradation of offshore structural component [3].

 

Aging management [4].
Figure 4. Aging management [4]..

 

The status of the known degradation mechanisms applicable for safety barriers should be evaluated and documented. The basis for acceptance of deviations and management of change (MoC) is reviewed in as a justification for the new mode and timeframe for continuous operations. The engineering evaluations of all changes and eventually mitigation measures against all operating risks must be documented. OGPs must review, evaluate assess all damage mechanisms or defects that may impact the facilities or individual operating systems for the life extension period. This is generally applicable to damage or defects where a temporary MoC has been accepted due to a limited period of use and this period has since been changed as a result of ALE considerations. The OGP is then required to re-assess the basis for acceptance to verify that this is still valid for the new period. Components or systems with a high consequence of failure, which are not available for inspection must be identified, evaluated, analyzed, and qualified for life extension. It is required that OGPs evaluate the consequence in case of failure, monitors indications of failure and have plans for compensating actions if indications of failure are found. Latest knowledge related to degradation and life extension shall be applied. A case study is provided within Section 11, to demonstrate a simple application of the ALE framework and possible outcomes.

 

Operational context

As the Asset ages, there is increasing challenge to maintaining equipment and installation integrity, compliance with Regulatory requirements and improve economic hydrocarbon recovery from depleted fields. As such, life extension analysis and evaluations must be based on the planned use of the facilities during the life extension period. Changes to the operational conditions that can have an impact on the efficiency of resource exploitation, the risk profile as well as the performance of the barriers due to aging, must be considered. The potential changes to the operational conditions that influence the degradation of barriers must be identified and used as basis for life extension evaluations.

Based on Norwegian Oil and Gas Recommended Assessment and Documentation for Service Life Extension of Facilities, Rev1, 2012 [5] and operational data and requirements, the following should, among others, be considered:

  • reservoir depletion causing subsidence of the facility
  • shallow gas detection and mitigation
  • changes in climatic conditions resulting in changes to environmental loadings and operating conditions
  • Increased changes in fluid compositions that can adversely affect the corrosion rates in certain systems
  • Changes to the original design assumptions as provided in QRA etc.
  • Well and drilling factors
  • Plans for increased gas flow
  • Need for new process or utility equipment due to changed flows, chemistry, pressure, injection or chemicals
  • New methodologies to simulate damage and degradation.
  • Changes to equipment usage.

 

An asset life extension program

The basis for the design and design life of facilities with its associated platform, wells, subsea systems and pipelines may be different. When facilities are planned to be used beyond design life, OGPs should define the life extension period for which the different parts of the facilities are planned to be used. An ALE framework outlining the main tasks as a six (6) step process is proposed and provided below on Figure 5..

3.1 Data and information

The collection of data and information is often the most challenging aspects of commencing an ALE study. It is recommended that records be securely placed within an electronic database generally used to manage asset integrity and reliability solutions. The availability and accuracy of information should be evaluated for each facility considered. The information should constitute design basis and specifications, design and as built drawings, design/(re-) analysis reports, inspection reports, maintenance and repair records and specifications. Once these records have been complied, data quality measures should ensure the appropriate data for screening. In some cases, the data analytics and trending measures give a better representation of the data set and how this can be used effectively in an ALE program.

 

A visualization of methane leak detection technology utilizing weather data
Figure 5.

 

3.2 Gap assessment

Gap assessment is the second stage of an ALE process. Identifying gaps can be broken down to several steps, which includes: • Identify hazards and critical barriers. • Check integrity and functionality of barriers. • Assess current performance of barrier against intent. • Review historic performance of barriers. • Review current state of maintenance and gaps. The gap assessment shall focus on the barrier functions and the factors that influence the barrier elements. This includes technical, organizational and operational elements. The gap assessment and recommendations are performed based on the major inspection findings, root cause failure analysis reports, modification implemented on the equipment, bad actor list, history of incidents, maintenance report, overhaul findings, reliability data, operating and maintenance philosophy and any condition monitoring recommendation. Any life extension recommendation must take the future technical condition, operating parameters and mode of operation into consideration. The assessment should also include review of the forecasted production profile, exploiting synergy with other related equipment such that key assets and system infrastructure can be rationalized, optimized or expanded. A process for the identification and correction of gaps is provided within Figure 6..

 

A visualization of methane leak detection technology utilizing weather data
Figure 6.

 

Process for identification and correction of gaps [5]

The recommendations from the gap assessment are to cover all the remedial actions necessary to prevent the risk associated with spare strategy, obsolescence related to the equipment and spare parts, remnant life analysis and prediction of future failures modes and degradation mechanism especially related to aging during the extension period. The benefits of applying new technology in addressing the gaps shall be evaluated. This could help mitigate or close gaps with less modifications or compensating measures. The Health and Safety Executive, UK (2013) KP4 Report [7] outlined the following safety management systems as being the barriers on the facilities that are not to be breached. They include: • Structural integrity; • Process integrity; • Fire and explosion; • Mechanical integrity; • Electrical, control and instrumentation; • Marine integrity; • Pipelines; • Corrosion; • Human factors. In addition to the above mentioned the following systems may be considered • Cranes and lifting equipment • Telecommunication facilities • Subsea systems • Life-saving equipment Oil and gas producers (OGPs) are to perform analyses and evaluations to demonstrate and understand of how the time and aging processes will affect HSE, the facilities barriers including technical operational and organizational aspects and resource exploitation. They shall also identify measures required to mitigate the impact of the time and aging processes (Figure 7).

 

A visualization of methane leak detection technology utilizing weather data
Figure 7.

 

Recommended life extension assessments of barriers [5].

The Norwegian Oil and Gas Recommended Assessment and Documentation for Service Life Extension of Facilities, (2012) [5] provides good guidance on the processes, resources and methodologies used in the ALE approach to find the “as is” condition and re-qualification for life extension and how to implement and document. Safety critical elements (SCEs) such as wells, subsea jacket structures, pipelines, risers, mechanical equipment etc. are to be qualified for the continuous operations and asset life extension. Quantitative and qualitative assessments are generally employed for equipment where known degradation mechanisms are prevalent and where quantitative models exist to calculate degradation, remaining margins and prediction of remaining service life. Quantitative analysis including probability of failure (PoF) is generally employed for structures, pipelines, position mooring, and flexible or steel catenary risers etc. and requires string technical expertise and often specialist software packages. Qualitative assessments is also possible but must be supported by effective data management and operating historical data to make good engineering assessments.

Risk assessments must be performed to verify that the facilities risk level is within acceptable limits in the period of life extension and As Low as Reasonably Practicable (ALARP). The principle of ALARP is in widespread use in the oil and gas industry. The following risk evaluations shall be performed based on the context defined for life extension: • Accumulation of Operational Risk Assessments (ORA), as some of which may be decoupled because they have been considered in isolation and not in combination, potentially resulting in unknown increased risks • Risk assessment of major accident risk, Quantitative/Qualitative Risk Analysis (QRA) • Emergency preparedness and response • External environment • Occupational safety, health and working environment. Ensuring risks have been reduced to ALARP means balancing the risks against the costs to further reduce it. The decision is weighted in favor of health and safety because the presumption is that OGPs should implement the risk reduction measure. It is expected that the latest available technology and knowledge related to analysis of major accidents is applied. The conservatism level and any assumptions made in risk assessments are to be assessed and evaluated for all continuous operations. The vulnerability, actual and expected effectiveness of the barrier function, including technical, organizational and operational elements shall be included in the risk assessment.

The OGP risk matrix consists of a consequence axis and a likelihood axis. The consequences are those of credible scenarios (taking the prevailing circumstances into consideration) that can develop from the release of a hazard. The potential worst case consequences, rather than the actual ones (that may have occurred previously), are used. After assessing the potential outcome, the likelihood on the vertical axis is determined on the basis of historical evidence or experience that such consequences have materialized within the industry, the entity or a smaller unit (Figure 8).

 

A visualization of methane leak detection technology utilizing weather data
Figure 8.

 

Maintenance management system

Effective inspection and maintenance are important in ensuring asset integrity and reliability. In developing the maintenance management systems an initial review is required determine status and how the aging processes is covered in the existing maintenance program. The review is to evaluate the need for updating the integrity, reliability, vulnerability and consequence analysis for continuous operations in the future. Experience and knowledge from documented failures and lessons learnt shall also be part of the evaluation and be used to improve the maintenance management system. In principle, the maintenance management system should be within a computerized database with detailed history of the operating, design, assessment, inspection and maintenance records accessible to all key personnel.

Emergency preparedness

Human factors area comprises methods and knowledge which can be used to assess and improve the interaction between people, technology and organization to realize efficient and safe operations. The factors should include organizational structure, competency or training requirements, and succession planning. Human factors analysis shall be performed where changes are made or where extended life challenges the established human, technology and organizational context. Organizational system is also a factor to be considered, which aspects include engineering design, contract and procurement management. Engineering design and related procurement activities require a thorough and careful consideration of asset aging and life extension factor. The risk from each finding and the overall potential (future) risks shall be evaluated before deciding on the implementation of measures.

Assurance and verification

The OGP is to ensure that experience on lifetime extension from other installations and operating areas is applied to the analyses and evaluations carried out for the application. Any specific relevant information shall be included in the application document. OGPs are to ensure that the analyses and evaluation work has been carried out in accordance with the regulations, the relevant company standards and have been verified by the appropriate technical discipline authority.

Occupational health

The OGP will evaluate the status of working environment factors that are relevant for life time extension, prior to the commencement of implementing ALE. Factors that should be include considerations for chemical/radiation exposure, lightning and ventilation, ergonomics, noise/vibration pollution, material handling and storage, outdoor operations and accommodation facilities. The main objective of the evaluation is to provide a status of the working environment according to both technical and operational requirements. The assessment/evaluation are appropriately based upon existing conditions at the facility, and if necessary, follow-up with new evaluations and assessments as required. The operational risks of each from each finding and the future risks shall be evaluated before deciding on the implementation of measures for improving working environment.

Engineering design

All assets are required to have design documentation available and accessible, which supports effective design at all stages of the asset life cycle and in relation to the management of aging life extension. All engineering activity to be undertaken throughout the anticipated service life of an asset should properly address life extension considerations.