Published on March 11, 2014
Global Iron Ore & Steel Forecast Modularisation for Iron Ore Projects 11 March 2014 Matthew Cobbett Executive General Manager Cory Fisher Project Manager
Agenda Safety - Potential for Improvement with Modularisation Who is Fluor? What is Modularisation? The Reason for Modularisation 1st Generation Modules in the Pilbara 2nd Generation Modules in the Pilbara Conclusions and Recommendations GV20130655001.pptx2
Safety Improvement with Modularisation GV20130655001.pptx3 Typical Pilbara Site TRIFR = 7.5 2nd Gen Fabrication Yard 3.25 Million Man-hours – 2 First Aid Treatment
Fluor Corporation Industry leader – One of the world’s leading publicly traded EPCM and project management companies; #110 on FORTUNE 500 list in 2013 Global reach – Over 1,000 projects annually, serving more than 600 clients in 79 different countries Worldwide presence – Offices in 29 countries on 6 continents Depth of resources – 41,000 employees globally Celebrated 100 years in 2012 60 Years in Australia GV20130655001.pptx4 Fluor Corporate Headquarters Dallas, Texas
2012 Financial Performance Revenue: $27.6 billion New awards: $27.1 billion Backlog: $38.2 billion Fluor Corporation is rated at investment grade levels: • Long-term Ratings: Standard & Poors “A-” Moody’s “A3” Fitch “A-” • Short-term Ratings: Standard & Poors “A-2” Moody’s “P-2” Fitch “F-2” • Outlook: Standard & Poors - Stable Moody’s - Stable Fitch - Stable GV20130655001.pptx5 Fluor Corporation 56 Years on NYSE
Fluor Australia: Current Projects GV20130655001.pptx6 * * Note: Executed as part of FAST JV
What is Modularisation? “What is?” • Modularisation is an execution approach for design, procurement, contracting and construction that shifts construction hours away from the site • Assemblies of process plant components • Assembled at one location (fabricator) and transported to another (jobsite) • Made up of structure, equipment, piping, electrical, and instrumentation • Made in a variety of sizes GV20130655001.pptx7 Prefabrication Preassembly Process Modules Offsite Fabrication
Why Modularise ? Project drivers for modularisation (pre-assembly, configuration, and fabrication location) • Safer controlled construction – avoids onsite work at heights and temporary handrails, and utilises fab yard overhead craneage, transporters • Reduce (unproductive) work hours onsite and reduce camp size • Value – grating and handrail can be incorporated, platework, liners, and piping can be included in assembly • Schedule benefits – parallel activities with earthworks/concrete and offsite fabrication • Labour availability • Risk management 8 GV20130655001.pptx
Why Modularise ? Project considerations • Schedule acceleration requirement • Engineering design safety factors • Need early vendor design information • Design software for engineering and shop drawings • Transportation to remote locations • Skilled labor shortages and/or low labor productivity • Industrial Relations challenges • HSE challenges • Risk mitigation: final cost and schedule certainty Recent modularisation project results • Allowed for more productive work in shop environment from experienced craft (almost 2:1) • Reduced field workforce, congestion, travel time, remote location impacts, overtime, and created more work fronts • Facilitated more ground level work, less preparation, and scaffolding • Broke job into smaller, more manageable pieces • Facilitated less dependency on weather, remoteness, or site conditions • Reduced strain on the availability of experienced site craft and supervision GV20130655001.pptx9
1st Generation Modules in the Pilbara GV20130655001.pptx10
Case Study – 2nd Generation Modules
Key Lessons Learned (1st Generation to 2nd Generation) More structures could/should be modularised – stair towers, transfer stations, and train load out facility Screening building screen support Modules, bins, and hopper Modules worked well – replicate Maximum of 4 lift points better suited fab yard, ship, and site crane/lifting requirements Use of lifting trunnions where possible – safer/easier than lifting lugs and shackles GV20130655001.pptx12
Key Lessons and Differences (1st Generation to 2nd Generation) Distance Port Hedland to Site = 350 kilometres (1st Generation) Distance Port Hedland to Site = 500 kilometres (2nd Generation) More structures modularised – stair towers, transfer stations, and train load out facility. Max Module weight kept to approximately 200 tonnes due to increased distance and uncertainty of bridge limits during design. Decreased bridge inspection requirements, faster convoys. Screening building screen support Modules, bins, and hopper Modules worked well – replicated (3 PS Screen Support Modules installed in 1 day). 2nd Generation – Modularisation of Stockyard Transfer Stations proved very effective for site install and access (4 Modules installed in 3 days). Engaged Chinese Fabricator with more “Offshore” Modularisation experience and better safety culture (Australian scaffold standard essential). GV20130655001.pptx13
Shop Detailing – Strategy from Lessons Learned on 1st Generation The Chinese fabrication facilities can utilise their own in- house shop detailing capability however they will not be familiar with WA and other associated standards, especially mechanical platework detailing, and would require extensive in-house supervision. This issue was experienced on 1st Generation. Execution strategy was for shop detailing undertaken by WA contractor, and issued directly to the nominated fabricator. Providing shop detail drawings by Perth based shop detailers, allows schedule gains to engineering progress by the early release of drawings. Detailing of grillage was effectively completed by Chinese Fabricator – simple detailing. GV20130655001.pptx14
Summary of Fabrication Strategy China Based Fabrication • Drivers No mechanical or electrical equipment to be shipped overseas for fit out of Modules Remove work hours offsite Reduced cost (improved value) and improved schedule Larger transport envelope. EPCM efforts to be concentrated in one location and maintain a level of tonnages that will be attractive to the larger fabrication workshops • Scope Modularisation of inflow, OHP, and outflow building steelwork Shuttle trusses and GTU drive towers, transfer stations, and TLO bins Australian Based Fabrication • Drivers Install equipment – pulleys, idlers, etc. Optimise local fabrication content (IR local content) Locally fabricate and deliver early steel to site to enable early mobilisation of SMP contractor • Scope Conveyor steelwork COS hoppers and chutes Dust collection structures. Train load out smart Module (PAM) GV20130655001.pptx15 Total Tonnes = 15,000 Total Tonnes = 5,200
Offshore versus Onshore Fabrication and Pre-assembly of Modules/Trusses Fabrication, pre-assembly, shipping, and transport to site • Offshore fabrication = 15,300 tonnes • Onshore fabrication = 5,296 tonnes Schedule comparison – tonnes per month from award to completion in fab yard • Offshore fabrication output 850% more tonnes per month compared to onshore fabrication GV20130655001.pptx16
Modularisation – Safety Key requirement in selection process/criteria for fab yards as well as tender presentations and evaluations. Almost 3.25 million work hours were recorded on the Offshore Fabrication project, with no lost time injury and 2 first aid cases Safety culture during the life of the project changed due to supervision and the introduction of the hazard card system Hazard cards – encouraged increased management focus on close out of action items GV20130655001.pptx17
Traffic Management Plan – Overall Philosophy Objective was to minimise police and pilot resources and to reduce the number of disruptions Night time movements down Great Northern Highway to minimise community impact MRWA approval was required, requested, and granted for Project GV20130655001.pptx18
Night Time Movements Study A report that quantitatively analysed the impact of night time movements of oversize load operations between Port Hedland and the mine site compared to day time was commissioned 30 kilometers/hour average speed – 9:00 A.M. Port Hedland departure: • A scenario in which oversize load operations are conducted across three days. Two campsites are utilised in route. Operations commence at 09:00 on each day. 30 kilometers/hour Average Speed – 9:00 P.M. PH departure: • As above, except that operations commence at 21:00 on each day. As illustrated in the figure to the right, switching to night time operations results in a 91% reduction in the number of light vehicles delayed, and a 76% reduction in the number of heavy vehicles delayed. Total delay, as quantified by vehicle hours expected to reduce by 85%. Scenario 9 A.M. 9 P.M. Change Vehicles Delayed Light 454 39 -91% Heavy 348 84 -76% Total Delay 269 hours 39 hours -85% GV20130655001.pptx19 0 50 100 150 200 250 300 Hours Total Delay 0 200 400 600 800 1000 Vehicles Vehicles Delayed 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 9AM:Heavy 9AM:Light 9PM:Heavy 9PM:Light
Divisible Loads – Optimisation Approximately 19 off loads (stacked flat packs) • 70% reduction of police escorts • 70% reduction of road closures for passing Approximately 63 off loads (disassembled flat packs) • Unachievable police escort requests • Significant other road user interface issues GV20130655001.pptx20
Transport with Approval for Night Time Moves and More Than 2 Loads/Convoy Night time Module movements – 3 nights travel to site rolling road block 136 Modules moved over 27 night time convoys Total = 81 nights of rolling road blocks GV20130655001.pptx21
Transport Without Approval for Night Time Moves and Greater Than 2 Modules per Convoy Day time travel (refer impact on traffic on GNH) 3 days 136 Modules would have been moved more than 68 convoys Resulting in total = 204 days of rolling road blocks, compared to 81 nights GV20130655001.pptx22
Transport Envelope from Port Hedland for Offshore Fab GV20130655001.pptx23 Notes: 1. The weight includes grillage and shipping steel. 2. These dimensions exclude the transport vehicle (unless noted otherwise). 3. The width assumes the load is centred on the trailer. i.e. the maximum half width (the distance from the COG to the outside edge of the module) is 6.75m. 4. The height assumes 1.2m for height of trailer deck above road and a further 0.9m height of transport grillage. 5. Weight based on a double deck 26 line trailer with 1.55mm axle spacing. This is specified by Main Roads WA. If module weight is greater than this there is a requirement for bridge supervision. Revision: 0 Module Dimensions Project Offshore Maximum Offshore Weight 308MT 350MT Width 12.0m 13.5m Height 9.5m 11.36m Length 38.0m 40.0m 1 2,3 2,4, 2
Transport Envelope from Perth for Onshore Fab GV20130655001.pptx24 Notes: 1. The weight includes grillage and shipping steel. 2. These dimensions exclude the transport vehicle (unless noted otherwise). 3. The width assumes the load is centred on the trailer. 4. Module height is dependent on trailer and grillage configuration, e.g. trailer heights vary from 0.9m for a platform trailer to 1.5m for a standard trailer. Grillage assumed as 0.3m 5. To be transported along the usual Heavy Haulage Routes HH19 and HH2 from Kwinana to Jimblebar, the loaded height must be no higher than 5.3m to clear the Berkshire Road Footbridge over Roe Highway, Forrestfield. 6. The “Maximum Onshore” category follows a different transport route via Hale and Hawtin Roads near Kalamunda which bypasses several low height clearance bridges on Roe Highway 7. Removal of street furniture and traffic light required. Large impact on road. Dimensions Design Onshore Maximum Onshore Module Weight 100MT 200MT Module Width 5.5m 8.0m Module Height 4.0m 4.6m-5.0m Loaded Height 5.3m 6.0m Module Length 18.0m 38.0m 1 2,3 2,4,5 5,6 2 5 6 7
Incentive for using Freight Forwarder – Module Shipping and Transport Total Transport Solution – Door-to-door solution i.e. ex- China organise origin transportation/export clearance/marine warranty surveying/pre AQIS compliance/sea freight/customs clearance/ discharge/craneage/haulage to site and offloading at site Cost Effective – a multinational freight forwarder, with the ability to negotiate in the market place with shipping companies, airlines, and heavy haulage without sole sourcing 3 Site SMP install contracts meant site was the obvious interface for Module handover GV20130655001.pptx25
Project Photos Critical Path Ship 7 – Product Screen Support Modules GV20130655001.pptx26
Project Photos Critical Path Ship 7 – Product Screen Support Modules GV20130655001.pptx27
Modular Construction Recommendations • The decision to modularise is a program execution decision NOT one that is made in construction • To be successful it is a detailed process of --- What, When, How, and Why --- to modularise • Need a commitment to move engineering forward to support the decision • Need a commitment from the owner’s approval process to support all earlier execution requirements • Understanding of the early work sequences must be built into the fabricator's organisation • Fabricator selection process provides a clear understanding of the fabricator's internal work processes and sequences. Shop drawings, nesting plans, weld maps, QC documents, and erection mark drawings • Ensure that engineering requirements matches the material grades and component configurations available within the fabricators market • Designing with rolled sections produced within that country • Have the original engineering drawings translated into the local language • Ensure Engineering Platform matches the fabricator’s • An advantage to Module Fabrication in a major shop is the ability to work double or triple shifts, coupled with a larger permanent workforce GV20130655001.pptx28
Modular Construction Recommendations Ensure route survey and transport corridors are understood Detailed planning for Module moves Understand the critical path Recognise that Risk exists and manage that risk It’s a cultural change Modularisation can accelerate schedule and firms up cost certainty Modularisation can deliver cost savings, but expectations must be tempered by shipping costs Modularisation can lead to higher quality 3rd Generation – “Smart Module” Maximisation Use someone who has done it before – make use of the “lessons learned” GV20130655001.pptx29
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