Lean Manufacturing in Upstream Oil & Gas

It’s Not Just for Manufacturers Anymore...

Whether it be improving rig move times, recompletions, or organizing what a lease operator carries in his truck, Lean techniques can be applied to help improve performance and, ultimately, production for the oil and gas industry, as well as manufacturing. Originally developed by the Japanese automobile manufacturing industry, Lean is a collection of tools to reduce waste and increase process speed. Lean tools include workplace organization (5S), mistake proofing (including visual instructions), and reducing changeover time (in manufacturing this is done using SMED [Single-Minute Exchange of Dies]).

The Project

Our client, a large independent oil and gas company, faced two separate challenges. One challenge was that lease operators were in need of clear instructions on how to properly operate and maintain a certain type of wellhead compressor. The second challenge was to reduce the time required for drilling rig moves.

The Lean Approach

Our client’s East Texas asset lease operators were contractually responsible for certain maintenance procedures on well head gas compressors. The contract specified that the vendor was to maintain 95 percent availability, otherwise a rebate or credit was due. The manufacturer of the compressor had prepared the usual, written instructions for start-up, routine maintenance, and shutdown of the machines. However, for someone unfamiliar with the machine, the instructions were difficult to understand. In addition, different lease operators approached compressor maintenance differently, depending on their background and training.

In our client’s drilling operations in the Washakie Basin of Wyoming, rig move times were highly variable, ranging anywhere from four days to more than 10. Lack of planning, communication, and coordination with the trucking company that transported the rig parts contributed to the lengthy moves.

Visual Maintenance Instructions

To assist the lease operators in carrying out their well head compressor maintenance responsibilities, MTG first met with the compressor vendor to clarify responsibilities and accountabilities for compressor downtime, both planned and unplanned. Together with our client, we designed an Availability Tracking Sheet which was placed in the compressor control panel door. The lease operator was only required to record 24-hour run time on a daily basis and to explain any downtime. These sheets were used to calculate percent availability on a monthly basis and to claim rebates from the vendor.

To clarify lease operator compressor maintenance responsibilities, a set of Visual Maintenance Instructions were jointly created with the compressor vendor. Each step in the process was clearly illustrated with digital photographs and a concise written description of the procedure.

Utilization of the Availability Tracking Sheet and Visual Maintenance Instructions resulted in a marked increase in compressor uptime, better unplanned maintenance response time by the vendor, and the creation of common, easy-to-follow procedures for the lease operators.

SMED and the Rig Move Workbook

We first conducted field observations of existing rig moves to understand the timing of key process steps and the sequence of events. From this, we were able to create a rig-move methodology with a clear list of process steps, including the target times in each step’s critical path. An Excel program was created to generate clear, step-by-step procedures. A Variance Report was used to record rig move issues, perform a root cause analysis, and develop action plans for continuous improvement.