Bangkok--28 Mar--124 Communications
IRPC, a regional integrated refinery and petrochemical company, plans to implement a major operational efficiency program with the aim of reducing operating costs by 3.75 billion baht within the next three years and also improve operational productivity to match international refining standards.
To achieve this goal Shell Global Slution, a world industry leader in operational and technological consultancy services for processing industries, has been retained to provide technical assistance and consultancy.
Dr. Piti Yimprasert, IRPC Chief Executive Officer, said this move is necessary and very crucial for the future of IRPC. During the first two years, a team of technical refinery experts from Shell Global Solution will be working closely with the local IRPC team to find ways to improve operational efficiency. It is expected that base on year 2006’s market performance with minimum additional capital investment at least US$0.60 per barrel can be saved as a result of this program. As IRPC currently has total refining capacity of 200,000 barrels per day, this means cost reduction of US$40 million or 1.5 billion Baht a year.
When the improvement program is well in place in the following year savings will increase to as much as 1.512 billion baht a year.
In addition, three international credit rating agencies, S&P, Moody’s, and Fitz Rating have been commissioned to evaluate IRPC’s operational performance and efficiency. S&P and Moody’s have just completed their evaluation while Fitz will start in the second quarter.
“This is important for IRPC’s growth and expansion should this be necessary and will enable us to compete with international players in the long term,” Dr. Piti added.
Before bringing in Shell Global Solution, IRPC’s new management commissioned KBC, a well-known consultant in the oil and gas industry, to evaluate the entire facilities and operations. Then, Nexant, another oil and gas consultancy, was hired to complete the details of the work plan to boost efficiency.
These steps were necessary because IRPC’s entire facilities and operations had not been evaluated for years and they would help the company cope with international refining and petrochemical production standards.
Both consultancy firms agreed that IRPC needs major operational efficiency and productivity improvement program if the company wished to become a world-class leader in refinery and petrochemical industry.
Shell Global Solution is an internationally renowned operational and technological services consultancy for processing industries with experience in working for top energy and petrochemical firms in Singapore, Brunei, Indonesia and China. It is currently PTT Group’s technical consult. Among other companies using Shell Global Solution’s services are Thai Oil, PTT Chemical and Rayong Refinery. In terms of service fees, recruiting Shell Global Solution is beneficial for IRPC because only actual expenses will be billed to the company.
There are 27 factories that will be participating in this program. Once completed, the results of the improvement drive will be benchmarked for the benefit of other industry leaders. This task will be handled by independent consultant such as Solomon, an international operational appraiser for refineries, and Philip Townsend, a petrochemical appraiser. This result will be the standard which IRPC will meet and complete.
Dr. Piti added, “IRPC has to move forward. We must improve our operational efficiency, services and quality while maintaining our operating costs to at a competitive level so that we can compete with world-class players while sustaining our growth as a regional leader in the integrated refinery and petrochemical industry.”
For more information, please contact Inthira Chaion-nom
Duchanee Nualkeiw
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