CASE STUDY 2 · Palmer International Partnership LLPPalmer International Partnership LLP

WESTERN EUROPEAN REFINERY

INCREASED PROFIT MARGINS

Our three-step approach to performance improvement - discovery, development and implementation support - helped one refinery in Western Europe to increase its profit margin by more than 50 cents per barrel over two years.This was a prime example of how, by retaining our services for the implementation stage, the client was able to achieve all of the benefits identified in the discovery and development phases. Without our support, they might only have implemented a third of them.

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Discovery and development uncovered opportunities throughout the refinery complex, impacting throughputs and yields in the process units, together with product blending and stream dispositions between the process units. They also proposed several low cost capital projects, mainly to improve energy efficiency.

Finally, a third of the ultimate performance benefits were the result of opportunities uncovered during implementation. The client was so convinced of the value of on-site implementation support that our services were extended from an initial six months to two years.

How the three steps work:

Our engineers work closely with the refinery team to gain a clear understanding of:

- The business environment in which the refinery operates
- How processing decisions are made
- How the plant operates to meet processing objectives
- The plant’s constraints and flexibilities
- How the refinery could exploit its capabilities more effectively

We carry out a detailed analysis in order to develop a performance improvement plan that is both technically and economically viable. The plan is developed in close co-operation with the refinery team and reviewed regularly to ensure that the proposed changes are realistic and credible.

It is important to include as many non-investment operational changes as possible since these can be tested for viability on the plant. If these tests are successful, the changes can be implemented quickly and provide the early successes that are essential to the overall effectiveness of the change programme.

We recommend setting targets for when changes should be implemented and identifying those responsible for each.

Unless fully supported, change programmes can often fail during implementation. To make sure this doesn’t happen, we recommend:

- Setting up a dedicated implementation team, supported by us
- Setting priorities based on cost, benefit and availability of resources
- Defining performance improvement targets and scheduling them into a benefits plan
- Using the implementation to uncover new opportunities and add them to the programme as they arise
- Reporting monthly and broadcasting the results widely
- Defining opportunity owners and encouraging them to drive ‘their’ opportunity as far as possible
- Not to expect every action on the opportunities list to be done at the same time

Project

WESTERN EUROPEAN REFINERY

INCREASED PROFIT MARGINS

Our three-step approach to performance improvement – discovery, development and implementation support – helped one refinery in Western Europe to increase its profit margin by more than 50 cents per barrel over two years.This was a prime example of how, by retaining our services for the implementation stage, the client was able to achieve all of the benefits identified in the discovery and development phases. Without our support, they might only have implemented a third of them.

How the three steps work:

Step one – Discovery

Our engineers work closely with the refinery team to gain a clear understanding of:

The business environment in which the refinery operates
How processing decisions are made
How the plant operates to meet processing objectives
The plant's constraints and flexibilities
How the refinery could exploit its capabilities more effectively

Step two – Development

We recommend setting targets for when changes should be implemented and identifying those responsible for each.

Step three – Implementation

Unless fully supported, change programmes can often fail during implementation. To make sure this doesn’t happen, we recommend:

Setting up a dedicated implementation team, supported by us
Setting priorities based on cost, benefit and availability of resources
Defining performance improvement targets and scheduling them into a benefits plan
Using the implementation to uncover new opportunities and add them to the programme as they arise
Reporting monthly and broadcasting the results widely
Defining opportunity owners and encouraging them to drive ‘their’ opportunity as far as possible
Not to expect every action on the opportunities list to be done at the same time