They change the way companies run their factories and their supply chain. Impact of digitization on petrochemical industry in Europe 2017 Online revenue share of petrochemical industry in Europe 2017 Confidence in using digital technologies among teachers in … A process simulation model was also developed for the sulphur system. Not only do the logistics service providers show a higher level of ambition for digitization, they also have a higher level of digital capabilities, and they are further down the road to achieving their ambition. •    Detection of small to large scale causes of efficiency losses •    Maintaining the effectiveness of control loops, controllers and models over time, so that the benefits of advanced process control are sustained The Petrochemical Facility was a retrofit of an existing large combustible liquid tank farm which stores refined oil products and ethanol to deliver motor fuels throughout the US. As in many other sectors, digitization is taking place at a fast pace in the petrochemical sector. As such, they act as the catalyst of digital innovations in the petrochemical supply chain. Nearly 240 managers and experts in the petrochemical supply chain participated. Half of the participants in the research report that it will even change the way they do business. Automation and augmented reality are changing the processes in warehouses and transportation. The solution enhances the refinery’s economic and environmental performance through a unified approach to the entire business process, encompassing monitoring to control of multiple process operations using multiple software applications on one platform. Once processes are digitized, then additional technologies like machine learning, AI, IIoT, digital twins, and a comprehensive, complete product lifecycle can emerge. Digitization makes for better contract and commodity-procurement decisions. This helps to convert a mountain of data into actionable information and translate that actionable information into decisions, leading to real, day to day plant improvements. What does digital transformation mean for the Petrochemical Industry? Investments in technologies bring along some challenges that need to be managed. Jacobs Engineering, Wood PLC, Day & Zimmermann, Air Liquide, Cheniere, LyondellBasell, Braskem, Pathfinder and There is a need for investment in developing these capabilities. The refinery in question decided to implement Helium Consulting’s sulphur specific IIoT offering, Mboss, to help plan and execute optimisation, followed by monitoring and control through detailed analysis, expedited corrective actions and use of automated algorithms in real time. Mboss is a proprietary software platform written especially for sulphur systems in the refining, petrochemicals and gas industries. Beyond digitization (converting analog information to digital) and digitalization (the technology-driven shift to business processes) lies digital transformation. As in many other sectors, digitization is taking place at a fast pace in the petrochemical sector. This is a sophisticated solution that aims to place a holistic tool in the hands of the operator, control engineer and top management to comply with emissions and energy reduction. Start-up companies are disrupting traditional logistics flows. And it gradually finds its way into other sectors, including the petrochemical industry. . They are asking for transparency in the supply chain, for new solutions and for even better service; digital technologies and applications can bring the innovation the market expects. This website uses cookies to optimise your user experience. Could it be a matter of time before these longer-term benefits materialize? A value focused approach is taken to leverage IIoT implementation and make refiners more profitable. Crambeth Allen Publishing Ltd, Multi-element and total S process analyzers, Hydrotreating and hydrocracking catalysts, Advanced sulphur analysis in hydrocarbons, Instrumentation, Automation and Process Control. Digitalization issues were discussed at Asia Downstream Week 2018, which was organized by Euro Petroleum Consultants (EPC) and held in Bangkok 9-11 October. Innovation in downstream industry means operating facilities at higher operational efficiency, less downtime and better safety. Digitalization in the petrochemical industry PI sets new standards & launches additional customer touchpoints at the #EPCA53 in Berlin. Petchem industry positioned for digital transformation Posted on Aug 25, 2017 The energy industry is lagging other sectors on the race to adopt digital technology, but increases in capital investment are pushing digital transformation now more than ever, industry analysts told Petrochemical Update. Much of this sulphur content is converted through hydrotreating into hydrogen sulphide in refining and other conversion facilities. As with any major initiative, digital transformation in chemicals is likely to be challenging. About half of the participants admit being still in the starting mode. A special focus was put on the following questions: How digital is the petrochemical supply chain? Users access data from the local area network and make recommendations for appropriate operational actions through a system that integrates advanced process control, soft sensors, simulation, linear programming and dashboarding technology to deliver real time benefits. The sulphur recovery process converts H2S to elemental sulphur (see Figure 1). The hydrogen sulphide fumes that characterise many gas processing, refinery operations and petroleum production sites represent a genuine threat to safety and the environment. And, the closer to the customer, the higher is the ambition for and the achievement of digitization. Indian Chemical News is a media company with interests in online publishing and industry events related to the chemical and allied sectors. Digital Transformation is a buzz word that seems to be on everyone's mind and lips these days. The future of work is increasing digital, and nowhere is that more evident than in manufacturing. READ MORE. Logistics Service Providers Act as Catalysts. And how can digitization create value in the supply chain of the petrochemical sector, from the upstream refineries, to the downstream traders, distributors and customers of the chemical companies? Functional excellence has generated significant productivity improvements over the past two decades. Click here for more information. What does digitization mean for the petrochemical supply chain? Digital transformation in the chemical industry (in German) Digital transformation in the chemical industry KPMG in Germany recently launched a ground-breaking study on digital transformation within the chemical industry, together with the market research institute, TNS Emnid where they interviewed 75 senior chemical industry executives. There is a bit more hesitation in the petrochemical industry on the technologies with medium to longer-term impact: “Maybe” is the typical answer participants gave when asked about plans for investment in the next 3 years on IoT, control tower solutions, robotics and automation, social media and self-learning systems. The so called GAFA companies (that is, Google, Apple, Facebook and Amazon), together with Microsoft, have chased some large bricks-and-mortar companies from the top-5 positions, which used to include some petrochemical companies. Interestingly, customers are even more stern; they almost unanimously report that the sector is lagging. They almost unanimously report that digitization will have a significant impact on their internal processes and their supply chain. To strengthen the chances of success, refinery and petrochemicals companies are using digital tools that enable plants to access the benefits of the IIoT and cloud computing. The customers seem to “push” digitization into the supply chain, all the way from the consumer to the refinery. The LyondellBasell announcement arrived just two days after the collapse of a $17.4 billion joint venture between Dow Chemical and Kuwait’s Petrochemical Industries Co. Big data and advanced analytics, cloud computing, digital identifiers and low-cost sensor technologies will find their way into the petrochemical supply chain soon, if not now already. Phased implementation of the system was planned for the refinery. An approach to such a challenge is to combine a business process for the sulphur system and create a digital platform for decision making based on sulphur processes. var CurrentYear = new Date().getFullYear() figure 3). The EPCA report provides some illustrations of innovative digital projects in the petrochemical supply chain through eleven cases from manufacturers and logistics service providers. In particular, they expect that it will have an important impact on the information flow (ordering, planning and control) and the financial flow (accounting, invoicing, payment), less so on the physical flow of products (cf. The solution combines ‘deep domain’ knowledge from operations technology and information technology for online analysis. Digital twins provide the means for successful digital advancement by breaking down previously inaccessible data silos and granting access to shared information in a common view that improves decision-making. The “number one priority” should go to attracting and developing digital talent, although it is fair to say that effort is also needed on all other aspects – digital strategy, governance, processes, culture and technology – of capabilities for digital transformation. The study clearly shows a higher level of maturity among the logistics service providers than among the petrochemical manufacturers. Mboss integration is shown in Figure 2. Key Considerations for Fuel and Petrochemical Companies Pursuing Digital Transformation. Thus, digital technology awareness and the appetite to transform is high within the EPCA membership even though overall, the petrochemical industry is perceived as lagging behind other sectors. New business models will arise, in manufacturing as well as logistics. They change the way companies run their factories and their supply chain. That said, digitization does pay off. In a recent AFPM webinar Bruce Taylor, director of digital transformation at Sinclair Oil and Chair of AFPM’s OPCAT Committee, described digital transformation … Running the race requires a set of capabilities. These economics based decisions use continuous comparisons between designed and actual performance. Download (PDF / 0.56MB) Petrochemical Update: Gauging industry digitization – capital projects turn to innovation, recruitment teams Posted by Alex Donatelli on Jul 13, 2018 By: Heather Doyle. This platform implements and leverages (if not already implemented) multiple independent applications in the plant on one platform to provide an optimised solution. Solution The customers are actually an important driver of digitization (cf. IIoT enabled digital systems with advanced analytics help refiners to make improved decisions … We keep you posted - Subscribe to the CHEManager International newsletter here! Digital Transformation Initiative: Oil and Gas Industry 5 Putting a value on digital transformation This value-at-stake analysis3 aims to assess the potential for digitalization in the Oil and Gas sector to unlock benefits for the industry, its customers and society more generally over the next decade (2016-2025). About half of the participants aim to be an early adopter of digitization or even an innovator (cf. Key findings from this The introduction of IIoT technologies is helping two companies improve their decision making and performance. Back in 2006, Clive Humby at Tesco said the almost prophetic words “data is the new oil.” Time proved him right. The examples of digitization in the supply chain are numerous. Request a consultation with TruQC. Petrochemical Update and Autodesk brought together a group of science, technology, engineering and project management experts to discuss and debate the role of technology in helping the construction and engineering industry rethink the future of capital projects. They show the implementation of a wide range of technologies and systems, offering more transparency, creating platforms for intensive collaboration, and improving supply chain performance. The Pharma industry is facing the biggest transformation since the rise of the modern medicines in the nineteenth century and the introduction of the manufacturing automation in 1980s. Conservation Services, Inc. (CSI) is a regional facility that provides safe and convenient disposal services for communities, businesses and industries serving Adams County, Colorado and surrounding areas. Previously, cost effective data generation was not available to enable use of technologies such as pattern recognition and analytics to guide actions based on generated data. figure 2). The sector may be lagging… yet, there is a lot of ambition. Improved collaboration with suppliers is an often-mentioned benefit. Refineries are generally equipped with process automation technologies including DCS, HMI, SCADA, data historian, and so on. Sulphur is present in crude oil and in natural gas in multiple forms including mercaptans. Case Study I: The journey to digitalisation Advertising Opportunities Print, Digital & Content Solutions. However, there is still a long way to go. The global petrochemicals market size was predicted at USD 441.0 billion in 2019 and is anticipated to witness a CAGR of 5.0% over the forecast period. The primary objective of the solution is to optimise the sulphur recovery circuit and find the best operating parameters to enhance performance while minimising cost and bottlenecks. The key operating challenges facing the refinery included: running an energy efficient process; catering to environmental regulations; unit unavailability; operations less than optimal; and lack of availability of real time process optimisation. But we have to take the first step and put down our pens. IIoT enabled digital systems with advanced analytics help refiners to make improved decisions by aggregating data from multiple sources. figure 1). The experiences from two recent petrochemical refineries’ improvement projects centered around Rail Logistics, show how applying digitization tools can increase communication, radically improve decision making and significantly increase rail transportation capacity. We experience every day how data and digital applications change the way we communicate, the way we live, and the way we do business. Transforming the petrochemical industry This digital transformation will affect the petrochemical industry in three main ways. The benefits of such IIoT enabled tools include: These form the backbone of automated data collection systems, process simulation modelling and scheduling. Digital technologies have a huge impact on the structure of supply chains. The global chemical industry can benefit from The case studies explain how the digitalisation journey started, the challenges faced, and the path to implementation of IIoT. Not only is there awareness of the importance and impact of digitization, there is also a sense of urgency. The results of the research study are discussed in the recently published report “Digitisation in the Petrochemical Supply Chain”. Secondly, the more we use information and communication technologies in the supply chain, the more we rely on these systems for our day-to-day operations, and the more we must manage the risk of hacking, system failures and temporary black-outs. In this article, we discuss two case studies from the refining and petrochemicals industry. Logistics service providers are investing in end-to-end visibility across the chain. Firstly, the risk of “de-humanizing” the supply chain needs attention. It has changed entire sectors, such as telecommunications, retail, and media and entertainment. •    Improved monitoring of energy use to increase operating efficiency •    Reducing maintenance costs. Pressure is also coming from newcomers in the sector: start-up companies launching new solutions, the so-called “GAFA” companies, or existing companies from other sectors entering the petrochemical sector. •    Decision making support and improved operation through continuous monitoring and by providing instant access to information Do you think existing technologies can enable digital transformation needs? A single window gives real time, actionable insights to optimise the process. The growth of the market for petrochemicals will be driven by rising demand for downstream products from end-use industries and capacity additions in the base chemical industry. The research study shows that managers in the petrochemical supply chain are well aware of the impact of digitization. Digitization in the Petrochemical Supply Chain (c) cono0430Shutterstock, Caroline Ciuciu, EPCA “Digital technology awareness is high even though overall the petrochemical industry is perceived as lagging behind other sectors.”, Ann Vereecke, Vlerick Business School “The pressure to digitize is mainly coming from the market and from outside the petrochemical industry.”, European Petrochemical Association (EPCA), Brenntag Schweizerhall Teaming with Bayer CropScience and Swiss Infrapark Baselland, Brenntag, AkzoNobel Partner in Ecosel BioCare, Myriant Signs Distribution Agreement with BCD Chemie, Arkema Launches Specialty Polyamides MED Grades for Medical Market. The software integrates data with multiple applications and layers of data validation and intelligent data analysis, and KPIs are generated and visualised in the dashboard. •    Reducing unplanned downtime with increased rate of asset utilisation However, there is still plenty of scope for improvement. To strengthen the chances of success, refinery and petrochemicals companies are using digital tools that enable plants to access the benefits of the IIoT and cloud computing. CHRISTOPHER JOSEPH and JOHNSON DOMINIC These developments provided the entry point and backdrop for a supply chain & logistics research study, commissioned by the European Petrochemical Association (EPCA) and conducted over the course of 2017 by a team at Vlerick Business School. Copyright © With modern digital tools, an operator will be able to understand deeply how a facility is operating, within few seconds. The solution provides a seamless stream of actionable insights, which enables sulphur operations in the refinery to inspect their process analyses for optimisation and early diagnosis of issues to prevent costly hidden upsets. What are the challenges that can impact a successful transformational journey? There is little enthusiasm for investments in augmented reality, blockchain and self-driving vehicles, which is in line with the low impact that is expected from these technologies. They may be considered as a threat for some, yet as an opportunity for other companies. Core refinery challenge The pressure to digitize is mainly coming from the market and from outside the petrochemical industry. The petrochemical industry has ridden high on emerging-market demand growth since the start of the century, just like producers of metals and other commodities. Chemical companies’ business processes, including manufacturing, marketing and sales, and R&D, present opportunities for performance improvement based on data capture and interpretation. AspenTech, a software company born out of MIT, is now playing an important role in helping chemical and petrochemical companies in their digitalization efforts – … Refiners are increasingly exploring digital tools that take advantage of the emerging Industrial Internet of Things (IIoT), as well as advanced software for data analysis that can optimise process operations and reduce downtime. Digitization casts a wide net of applicable industries that it could benefit. A digital transformation is happening within the oil and gas industry, and digital twins are at the heart of it. If and when investments in these technologies will be seen, it will most likely be in niche applications in the supply chain. A refinery where the option of changing feed strategy is not available may need to invest in expensive upgrading projects. This report focuses on the current state of automation in the petroleum/chemical industry… The majority of the participants in the EPCA study report an increase in efficiency and productivity, as well as an improvement of customer service. The first is using digital-enabled approaches to improve companies’ business processes, which can be called functional excellence. figure 4). Now, 12 years later, the top 5 companies in the world in terms of market capitalization are data-intensive enterprises. A plant enabled by IIoT is equipped with a combination of sensors, automation systems and cloud based technologies that are integrated with its current systems and data analytics capabilities. So, the overall picture the study draws is one of a sector that is well aware of the importance and potential impact of digitization that got off the starting blocks and is running. So, every industry is either at or near an inflection point for digital transformation. The petrochemical industry is a vital component of numerous industrial processes as it provides raw materi… Helium Consulting. APQC has gathered and analyzed information from 626 global organizations about the current state of their manufacturing practices, focusing on digitalization and the adoption of various technologies. Water units process analytics acknowledge that the petrochemical supply chain deliveries at lower working-capital costs and with customer... Mboss is a media company with interests in online publishing and industry events related to chemical! As such, they act as the catalyst of digital innovations in the supply chain consumer to refinery. Written especially for logistics service providers fire pumps and a custom in Line Balance Proportioning Foam to... Half of the system was planned for the refinery new level of among... To as industry 4.0 or Internet of Things ( IoT ) this article, we discuss two case studies how. 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