The Hydrogen Management Project was commissioned by Husky to debottleneck the H Oil unit in its Lloydminster Upgrader, and hence increase overall facility throughput. The project involves installing a membrane unit and compressor in parallel with the current hydrogen recovery system to off-load the H-Oil units and reduce the demands on the existing hydrogen recovery unit and the hydrogen plant. Early investigation of the existing system by the Bantrel process design team helped re-emphasize to Husky the urgency of the project due to ongoing contamination of the existing mole sieve under current operating conditions.
The Hydrogen Management Project had to be underway by Fall 2001 while accommodating the long lead times of the two main equipment items, the new compressor and membrane packages. The project is also constrained by a limited budget, and it has been Bantrel’s intention to review every opportunity for cost reduction during the front-end and detailed engineering phases.
On completion of the project’s +/- 25% estimate, it was clear that the cost was substantially higher than that initially envisaged by Husky. It was believed that the basic parameters used in the estimate were correct; therefore, to reduce cost, changes to the scope and execution strategy were needed. A value engineering program was initiated and substantial savings were identified by a combined Husky-Bantrel team which included George Houston (Project Management), Hafeez Rehman (Mechanical), Bob Bloodworth (Piping/Layout), Kiichi Hirakata (Control Systems) and Mark Timler (Construction). The following cost-saving items were identified as a result of this program:
- Elimination of non-critical items on the preliminary P&IDs
- Removal of variable frequency drives from the air cooler motors and re-examination of the philosophy of a single-stage versus two-stage compressor, resulting in significant reduction in equipment and piping
- Reduction of the assumed amount of cost growth in the membrane units further to completion of clarifications with bidders
- Overall reduction in the amount of heat tracing and insulating
- Removal of a safety shower in the compressor building, replacement of gas chromatographs and shelters by a simple hydrogen sulphide analyser, and examination of alternatives to expanding the deluge building
- Successful challenge of Husky’s specification on (1) spacing, thereby allowing a relocation of coolers and a 50% reduction in structural steel and a reduction in piping, and (2) fire proofing of structural steel below the air coolers
- Use of more optimal tie-in points, reducing piping by one third
- Reduction of the electrical estimate through potential use of existing trays and reduction of the number of tie-ins
- Reduction in the estimate of Owner’s costs from 9% of total installed cost (TIC) to 6%
- Utilization of non-union labour, resulting in lower anticipated costs and reduction of a portion of the required daily subsistence
- Additional cost savings were made by using innovative methods for assignment of construction contracts through combining contracts and using risk/reward conditions.