Stork Presentation on Migration (Willem Hazenberg)

ASSET REPLACEMENT STRATEGY AND AGING FACTORS OF CONTROL SYSTEMS

April 10, 2023ASSET LIFECYCLE INTEGRITY PARTNER PAGE 1

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Willem D. Hazenberg MBA EUR ING RIMarch 5 - 6, 2014

MERCURE Hotel Amsterdam City - The Netherlands

EUROPEAN INDUSTRY FORUM 2014

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Remnant Life Methodology

Asset Integrity ManagementCompliance Ranking

Future Impact: BusinessRanking

Future Impact: OperatingRanking

161284> 100.000 USD Production loss

> 4.0 hrsProduction loss

> 4.0 hrs

IncidentFatality

Permanent injury

12963> 25.000 USD< 100.000 USD

Production loss1.0 > - < 4.0 hrs


Incidentlost time

8642> 10.000 USD< 25.000 USD



Accidentno lost time

4321< 10.000 USD Production loss

< 0.5 hrsProduction loss

< 0.5 hrsNear miss

IMPACT

OftenOccai-sionally

SlightUnlikel

yCost

Increase

Future bottle-neck

Revenue loss

SHEQ

PROBABILITYDecision drivers

Replacementcandidates



> 4.0 hrs

IncidentFatality

Permanent injury

12963> 25.000 USD< 100.000 USD



Incidentlost time

8642> 10.000 USD< 25.000 USD






< 0.5 hrsNear miss

IMPACT

OftenOccai-sionally

SlightUnlikel

yCost

Increase

Future bottle-neck

Revenue loss

SHEQ




> 4.0 hrs

IncidentFatality

Permanent injury

12963> 25.000 USD< 100.000 USD



Incidentlost time

8642> 10.000 USD< 25.000 USD






< 0.5 hrsNear miss

IMPACT

OftenOccai-sionally

SlightUnlikel

yCost

Increase

Future bottle-neck

Revenue loss

SHEQ


Replacementcandidates

CommissioningDesign Life

(e.g. 30 years)

Year 1987 2017?

Remnant Life Study

Remnant Life

2014

Horizon

2034

Year 1987 20172014 2034

Year 1987 20172014 20342018

Asset & production ref. plan

Maintenance & Replacement

Strategy

Maintain

ReplacementCandidates

BusinessCase

Value upgrade?Production impact?Remaining life?

ReplacementProject

Company Strategy

Maintenance & replacement plan

Establish decision drivers: Safety Integrity Reliability Availability Future demand Etc.

Build business modelfor replacementdecision making:

Pilot projecton one unit

Step 4

Step 1

Step 3

Step 4

Establish Risk Matrix

Collect data on:

• plant and process

• current equipment status

• planned replacements

Criticality analysis

Gap analysis(incl. remnant life ofmost critical equipment)

Select replacementcandidates

Set up planning for 20 yearreplacement studies

Establish Risk Matrix

Collect data on:

• plant and process

• current equipment status

• planned replacements

Criticality analysis

Gap analysis(incl. remnant life ofmost critical equipment)

Select replacementcandidates

Set up planning for 20 yearreplacement studies

Step 2

Overview Long Term Asset Replacement Project

Main questions in a replacement study

Main questions in this field:1. What is the expected life of my assets?2. Why should I replace my assets?3. When should I replace my assets?

WHAT IS THE EXPECTED LIFE OF MY ASSETS?DISTRIBUTED CONTROL SYSTEMS N MT(X; Y;Z) =X – Σ YI + Σ ZI I=1 J=1



What is expected life

Depends of the view – Who is looking:• Engineering - design lifetime

• An assumed time period within which a component/system can be maintained as scheduled, is free from major repair and can fulfill the original usage.

• Accounting:• Tax deductible depreciation;

• Operational:• How long can it perform the “current?” requested task?• Can it perform the “near” future requested task?

• Technical:• Maintenance:

• How long can we maintain the component/system?• Do we need to anticipate by strategy on obsolescence?

Asset Integrity Management Compliance Ranking

Design Procure/ Construct

Operate/Maintain Change/Replace

Equipment Type

Design Life [Years]

Asset Integrity Measurement rankingSpent life [Years]

According international specs

Maintain-ability

Operat-ability

ProvenTechnology

Design

As per spec BuildingInstructions

Maintenance andOperating (OEM)Manual

OEM recommendedSpare Part list

Procure/ Construct

Up/below design specifications

Preventive maintenance plan

Follow OEM techn. Recommendations

Condition Monitoring Available resources and skills

Environmental /cleaning conditions

Accidents/incidents analyses (RCA)

Operate/Maintain

Replacement parts on condition

Replacement parts on use

Registration Maintenance History

Change/Replace

NEN 2767, PAS55 / ISO 55000 are the reference base.

What is expected technical life

• Prediction, based on normal patterns. • After the normal expected life failure data will be irrational. • This mainly caused by an unacceptable MTTR in case of

failure of a component since no direct replacement product is available anymore.

• This impose a unacceptable risk if no life cycle solution is implemented.

ENGINEERING – DESIGN LIFETIME

AGING AND DEGRADATION



Definition degradation:An undesired departure in the operational performance of any device, equipment or system from its intended performance.Note: the term degradation can apply to temporary or permanent failure.

Aging and degradation assets

Aging factors• Age of components;

• Degradation of material;• Environmental stress; (see next slide)• Use of components:

• Load of energy;• Movement of component.

Degradation of relay spacer materialDegradation of E-Wiring material

Aging factors – Environmental stress

Aging factors – Environmental stress:• Temperature (Ambient, Thermal load, high, Low)

• Relative humidity• Climate factors (Sun, wind, water, snow and ice)

• Occurrence of dust• Mechanical vibration (G forces/ seismic activity's ground)

• Et cetera.

Expected Life DCS componentsExpected Life DCS components

PCS Components 1970-1995 1995-2010systeem software 15 year 5 year

HMI Client 15 year 5 yearHMI server N/A 6 yearNetwork 20 years 6-12 year

Controller 16 year 8-12 yearInput/Output 16 year 8-12 year

Termination panel 15-25 year 15-20 year Field wiring 25-30 year 25-30 year field devices 10 year 10 year

WHY SHOULD I REPLACE MY ASSETS?DECISION TRIGGERS MECHANISM DISTRIBUTED CONTROL SYSTEMS



Triggers for replacement decisions

There are different triggers to decide to start a replacement. Triggers are internal and external.

Most important triggers for aged equipment are:• OEM marketing / Trust;• Operations;• Technical;• Business;• Organization;• Legislation.

What a modern DCS can do for you (DCS vendor marketing info)

Automation technology has probably changed significantly since your existing system was installed 10 or 20 years ago and so has the business climate. Today’s successful industrial operations require much more from their DCS than just safely controlling the process.

1. An integrated system — enterprise-wide;2. A lower total cost of ownership;3. A truly open technology platform;4. A verifiably cyber-secure system;5. High reliability and performance;6. An architecture that evolves with your needs;7. An easy-to-use system;8. Improved asset management.

But why buy people new systems?www.dcsselect.eu MBA Thesis Willem Hazenberg 166 inputs from 39 country's

http://www.dcsselect.eu/

Business reason long list selectionKnock – out criteria 40,3%

Knock – out criteria 12,8%



Knock – out criteria 13%

Knock – out criteria 21%



Knock – out criteria> 10% shown

……………………………Knock – out criteria 12%




Could not maintain old system

Replace obsolete system

Importance of business case reason

0% 20% 40% 60% 80% 100%

% end users response

Impor tance of :


Replace obsolete systems

Impr oved Automation

Use of advanced contr ol algor i thms

Impr ove loop contr ol

Impr ovement of pr oduct Qual i ty

Cr eate a mor e cost-eff ective pr ocess

Automatic star t-up and shutdown r outines

Higher pr oduction

Reduction in E quipment Maintenance

Impr oved pr oduct Y ield

Removal of manual pr ocesses

Impr ove r epor ting

Incr ease r eal -time decision making

Need f or a ease to use system

Incr ease in pr ocess knowledge

E ffi cient wor kfl ow

Impr oved use of Raw Mater ials

Incr easing inf or mation f or the wor kf or ce

Impr oved engineer ing data

Reduce wor kf or ce

Reduce complains of customer s

Removal of r edundant pr ocesses

Regulator y r equir ements

business inf or mation to the plant fl oor

Impr ove accounting data

Lar ger pr oduction mix

Mor e people thinking in the big pictur e

Imp

ort

ance

of

Importance for business case

Extreme important

Very important

Important

Somewhat important

Not very important

Not important at all


Replace obsolete system

Improve Automation

Use of advanced control algorithms

Migration balance between risk, performance, cost and benefits

Cost/Risk evaluation

Product life cycle (ABB Example)

• Active (active R&D and Sales)

• Classic (product maintenance Phase)

• Limited (Support by ABB Service)

• Obsolete (“try to fix when it fails”)

Product sales release

>7 Year >3 Year

Limited ObsoleteClassicActive

Last Buy

>12 month

Manufacturing End

>6 maanden

Obsolete announcement

Obsolete products are products for which, despite best efforts, support, maintenance and repair is no longer feasible

Obsolescence

In the interviews we focus on these questions

Some obsolescence factors:• Age of the system?• What is current Life cycle stage of the product?• Did the vendor declare the product obsolete?

• Year of Obsolescence?

• Is the original vendor still in the market?• Was there a vendor company take over?• Are there migration solutions from vendor or new owner?• Are there migration solutions from 3e parties?

Operational replacement reasons

• How long can it perform the “current?” requested task?• Are there performance problems for operations?• Are there downtime cost for operations?• Is there a corporate objectives for enterprise-wide data

sharing?

• Can it perform the “near” future requested task?• Do you need new functionality from the system in the next

five years that the current system can’t provide?• Process changes;• Advanced control capabilities enabling increased

throughput.

Technical /maintenance replacement reasons

• Maintenance:• Can we maintain the component/system?• Reduced equipment reliability;• Technical reliability (emotional EHS Fear +

Availability); • (increased failure rate or bad actors);• Reparability;• Serviceability;

• What is the primary fail component that the asset should be replaced.

Mission Maintenance department"Maintenance will safely accomplish our goal of providing Service Excellence (including increased Uptime and increased Overall Equipment Effectiveness) ….

Maintenance approach survey

• Maintenance Execution:• Skilled Resources people on site;• Numbers employees;• Function levels;• Trainings level.

• Service Contracts:• Is there service contracts/Call in contracts?• Number of spare parts?• Spare parts position (as a long term strategy)? • What is the call out time?• What is the quality of speed en service?

• Logistics:• Spare parts level on site (%);• Spare parts level of site under contract (%);• Time to get external parts (hours).

• Operation risk:• Comply to Alarm management Status according EMMUA 191

standard

Maintenance approach technology benefits gap survey

Technology - Asset management needs:• Fieldbus need;• Wireless technology.• Hart need;• Profibus need;

Organization Factors• Conversion approach;• Coping mechanisms;• Degree of technological dependence;• Organization IT maturity.

Equipment health survey

Performance standardsKPI Check

Check history records:• Operation;• System logs;• Maintenance;• Inspection.

Check integrity quality of answers

Business/economics replacement reasons

• Operational Asset availability risk increasing;• Safety risk;• Increased downtime operational cost;• Business strategy Availability, Lost revenue;• Financial Operating costs:

• Maintenance cost internal;• Cost saving (maintenance contract - hours)

• Investments Re-investment budgeting & capital rationing;

• Reputation risk. Optimal Economic EOL date

Organization replacement reasons

• Equipment expertise disappears from customer/ vendor;

• Project management resource and engineering capabilities;

• Standardization of technology platforms;• New project that need newer technology;• Centralization of control functions;• Reduction in Staff – operators in control room or plant.


• DCS/SCADA Security certification requirements? ISO / IEC 17799 and 270001;

• Relocating of Production facility by government rules; • Lower Pollution rules need new Process;• Military want to use certain technology –

radiofrequencies; • Compliance with food safety and traceability needs (FDA);• Regulatory compliance, while responding to customer

demands for better product quality and faster delivery.

“Legislation” triggers for replacement decisions


Training - services

Guidelines and manuals

Codes of best practice

Standards

Legislation

Policy

Tim

e/ye

ars

WHEN SHOULD I REPLACE MY ASSETS?DISTRIBUTED CONTROL SYSTEMS



When should I replace my assets?What kind of company are you?• Technology trendsetter (early adopters);• Technology follower (main stream);• Late stage;• Laggards.

Depends also on your company:• Profit/lost;• Market;• Shut down time table;• Expected life (EOL) plant;• Expected life plant business.

Best time for the replacement is before you get into the obsolesce phase.

THANKS QUESTIONS &DISCUSSION



MAYBE WE HAD JUST FORGOTTEN THAT MAN SHALL NOT MAKE DECISIONS BY ECONOMIC

ANALYSIS ALONE.


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Stork Presentation on Migration (Willem Hazenberg)

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