What is a Turnaround in the Oil and Gas Industry?
A turnaround or a “TAR” is a very expensive process in which an industrial plant or refinery goes through a scheduled shutdown in order to perform maintenance on the facility. During this time, production must come to a complete stop. Other terms for a turnaround include Inspection and testing (I&T’s,) debottlenecking projects, revamps, shutdowns, outages, and catalyst regeneration projects. In the oil and gas and refining industries, many companies plan turnarounds every 3-5 years. Turnarounds can take weeks to even a few months to complete depending solely on the extent of the project and any problems that come up throughout the process. Many refineries go through an extensive inspection and testing process during a turnaround. If an issue is identified, the turnaround process may be extended.
Why are Turnarounds Important in Oil and Gas?
Turnarounds provide an opportunity for many maintenance issues to be resolved. These potential issues cannot be addressed while the plant is operating. Shutdowns also allow for a full internal inspection of equipment that would otherwise be impossible while the equipment was running or while the tanks and vessels are holding the product. Turnarounds improve the efficiency of the plant and help to fix or prevent problems before they cause costly outages or accidents. A turnaround should result in the plant returning to peak performance levels when the production begins again.
In addition, there are regulations that might require the plant to have a turnaround periodically and may be necessary to meet the warranty requirements on various pieces of highly expensive equipment. Turnarounds are the most significant portion of a plant’s yearly maintenance budget and can affect the company’s bottom line if they are not planned properly. Not only are the tools and labor required for completing a turnaround extremely expensive, but the revenue lost by shutting down production can amount to a huge portion of the annual budget.
Shutdowns and Outages
The difference between a turnaround and a shutdown is that a shutdown is not always planned or scheduled. Typically, if supplies of natural gas or other products are lacking, refineries will usually come to a complete halt. These products can begin to decline if the natural resources are scarce, or prices are too high. Shutdowns can also occur when accidents, natural disasters, or other threats take place.
Outages don’t happen in an effort to protect equipment or individuals working in the facility. They happen when power supplies are disrupted, equipment breaks down, or deliveries do not arrive. They are also generally a lot shorter than a turnaround or shutdown. The goal for turnarounds, shutdowns, and outages are to have the ability to smoothly and quickly return to normal operation, stay on budget, cause no harm to workers, and stay within the plan.
What is The Cost of a Turnaround?
Turnarounds are extremely costly, a turnaround lasting even only a few weeks might cost the equivalent of an entire year’s maintenance budget. The reason for this is because of the increased spending to implement the shutdown and the loss of production and revenue during the process.
Turnarounds are also very expensive in terms of the amount of labor that goes into completing the maintenance activities. A shutdown must be done as quickly as possible to prevent the plant from losing even more money due to production stops. Therefore, the staff is often working overtime hours. A lot of the time turnarounds use many third-party contracting companies. These contracting companies add more value and efficiency to the shutdown at a cost. And during all the maintenance and cleaning there is usually major spending on resources and supplies. New equipment is often bought or rented during shutdowns and turnarounds as well.
Planning a Turnaround
Smart and extensive planning is the key to a successful turnaround and shutdown. Equipment in need of maintenance, repair, or replacement should all be acknowledged in advance. A base analysis of a refinery will give an overview of the scope and duration of any shutdowns and turnarounds needed. Last-minute modifications may still occur, but with detailed planning, most changes can be made safely.
A turnaround typically includes the following phases:
- Strategic Planning
- Detailed Planning
Strategic Planning is the most comprehensive phase of planning, it is simply an overview of what is planned and how it will be accomplished.
During the Detailed Planning phase, the specifics are put into place and the plan becomes more concrete. In the Organizing phase, work and tasks are distributed to those who are involved in the turnaround- there can be hundreds or even thousands of people involved. The Execution phase is the actual turnaround itself, during this phase safety and attention to detail are crucial. The Closeout phase consists of reporting the results collected from the entire turnaround process. The best way to plan ahead for a shutdown or turnaround is to evaluate immediately after the activities are completed. This allows the company to learn from any mistakes and set out a detailed plan moving forward.
Services Used During Turnarounds
As mentioned, turnarounds and shutdowns require a large team. And most turnarounds need to contract out a number of third-party companies that help execute the turnaround plan. Teams can be made up of hundreds or even thousands of site workers and contractors depending on how complex the project is. Some of these third-party companies may include:
- Boiler Trucks
- Equipment rentals
- Waste disposal
- Design and construction companies
- Maintenance support
- Management Personnel
- Cost control administration
- Utility Heating & Steam Support
Although most companies dread having to plan and execute a turnaround, it is crucial to the functionality of the oil and gas operation. Without turnarounds, numerous issues can arise during production, which can result in even more dangerous, expensive, and serious issues when it comes to workers, staff, production, and equipment. It’s important to stay on track and schedule your turnarounds periodically.