Refinery of the future: How IIoT enables safety and efficiency
(Editor’s note: This podcast was recorded on July 18, 2017.)
IT combined with the Internet of Things (IoT) and modern operations methods creates the refinery of the future.
In this podcast, Dana Gardner, principal analyst at Interarbor Solutions, discusses the challenges of IT in the petrochemical industry where safety and efficiency are top priorities. Joining him on the podcast are Doug Smith, CEO of Texmark Chemicals in Galena Park, Texas, and JR Fuller, worldwide business development manager for Edgeline IoT at Hewlett Packard Enterprise.
Dana Gardner: Welcome to the next edition of the BriefingsDirect Voice of the Customer podcast series. I’m Dana Gardner, principal analyst at Interarbor Solutions, your host and moderator for this ongoing discussion on digital transformation success. Stay with us now to learn how agile businesses are fending off disruption—in favor of innovation.
Our next Internet of Things (IoT) technology trends interview explores how information technology combines with IoT to help create the refinery of the future. We’ll now learn how a leading-edge petrochemical company in Texas is rethinking data gathering and analysis to foster safer working places and greater overall efficiency.
Here to help us define the best of the refinery of the future vision, we’re joined by Doug Smith, CEO of Texmark Chemicals in Galena Park, Texas. Welcome, Doug.
Doug Smith: Thank you, Dana. It’s good to be here.
Gardner: We’re also joined by JR Fuller, worldwide business development manager for Edgeline IoT at Hewlett Packard Enterprise. Welcome, JR.
JR Fuller: Thank you, sir. I appreciate it.
Gardner: What are the top trends driving this need for a new refinery of the future? Doug, why aren’t the refinery practices of the past good enough?
Smith: First of all, I want to talk about people. People are the catalysts who make this refinery of the future possible. At Texmark Chemicals, we spent the last 20 years making capital investments in our infrastructure, in our physical plant, and in the last four years we have put together a roadmap for our IT needs.
Through our introduction to HPE, we have entered into a partnership that is not just a client-customer relationship. It’s more than that, and it allows us to work together to discover IoT solutions that we can bring to bear on our IT challenges at Texmark. So, we are on the voyage of discovery together—and we are sailing out to sea. It’s going great.
Gardner: JR, it’s always impressive when a new technology trend aids and abets a traditional business, and then that business can show through innovation what should then come next in the technology. How is that back and forth working? Where should we expect IoT to go in terms of business benefits in the not-to-distant future?
Fuller: One of powerful things about the partnership and relationship we have is that we each respect and understand each other's “swim lanes.” I’m not trying to be a chemical company. I’m trying to understand what they do and how I can help them.
And they’re not trying to become an IT or IoT company. Their job is to make chemicals; our job is to figure out the IT. We’re seeing in Texmark the transformation from an Old World economy-type business to a New World economy-type business.
This is huge; this is transformational. As Doug said, they’ve made huge investments in their physical assets and what we call Operational Technology (OT). They have done that for the past 20 years. The people they have at Texmark who are using these assets are phenomenal. They possess decades of experience.
Yet IoT is really new for them. How to leverage that? They have said, “You know what? We squeezed as much as we can out of OT technology, out of our people, and our processes. Now, let’s see what else is out there.”
And through introductions to us and our ecosystem partners, we’ve been able to show them how we can help squeeze even more out of those OT assets using this new technology. So, it’s really exciting.
IIoT in the petrochemical industry
Gardner: Doug, let’s level-set this a little bit for our audience. They might not all be familiar with the refinery business, or even the petrochemical industry. You’re in the process of processing. You’re making one material into another and you’re doing that in bulk, and you need to do it on a just-in-time basis, given the demands of supply chains these days.
You need to make your business processes and your IT network mesh, to reach every corner. How does a wireless network become an enabler for your requirements?
Smith: In a large plant facility, we have different pieces of equipment. One piece of equipment is a pump—the analogy would be the heart of the process facility of the plant.
So your question regarding the wireless network, if we can sensor a pump and tie it into a mesh network, there are incredible cost savings for us. The physical wiring of a pump runs anywhere from $3,000 to $5,000 per pump. So, we see a savings in that.
Being able to have the information wirelessly right away—that gives us knowledge immediately that we wouldn’t have otherwise. We have workers and millwrights at the plant that physically go out and inspect every single pump in our plant, and we have 133 pumps. If we can utilize our sensors through the wireless network, our millwrights can concentrate on the pumps that they know are having problems.
To have the information wirelessly right away—that gives us knowledge immediately that we wouldn’t have otherwise.
Gardner: You’re also able to track those individuals, those workers, so if there’s a need to communicate, to locate, to make sure that they are hearing the policy, that’s another big part of IoT and people coming together.
Safety is good business
Smith: The tracking of workers is more of a safety issue—and safety is critical, absolutely critical in a petrochemical facility. We must account for all our people and know where they are in the event of any type of emergency situation.
Gardner: We have the sensors, we can link things up, we can begin to analyze devices and bring that data analytics to the edge, perhaps within a mini data center facility—something that’s ruggedized and tough and able to handle a plant environment.
Given this scenario, JR, what sorts of efficiencies are organizations like Texmark seeing? I know in some businesses, they talk about double-digit increases, but in a mature industry, how does this all translate into dollars?
Fuller: We talk about the power of 1 percent. A 1 percent improvement in one of the major companies is multibillions of dollars saved. A 1 percent change is huge, and, yes, at Texmark, we’re able to see some larger percentage-wise efficiency, because they’re actually very nimble.
It’s hard to turn a big titanic ship, but the smaller boat is actually much better at it. We’re able to do things at Texmark that we are not able to do at other places, but we’re then able to create that blueprint of how they do it.
You’re absolutely right, doing edge computing, with our HPE Edgeline products, and gathering the micro-data from the extra compute power we have installed, provides a lot of opportunities for us to go into the predictive part of this. It’s really where you see the new efficiencies.
Recently, I was with the engineers out there, and we’re walking through the facility, and they’re showing us all the equipment that we’re looking at sensoring up and adding all these analytics. I noticed something on one of the pumps. I’ve been around pumps, I know pumps very well.
I saw this thing, and I said, “What is that?”
“So that’s a filter,” they said.
I said, “What happens if the filter gets clogged?”
“It shuts down the whole pump,” they said.
“What happens if you lose this pump?” I asked.
“We lose the whole chemical process,” they explained.
“OK, are there sensors on this filter?”
“No, there are only sensors on the pump,” they said.
There weren’t any sensors on the filter. Now, that’s just something that we haven’t thought of, right? But again, I’m not a chemical guy. So I can ask questions that maybe they didn’t ask before.
So I said, “How do you solve this problem today?”
“Well, we have a scheduled maintenance plan,” they said.
They don’t have a problem, but based on the scheduled maintenance plan, that filter gets changed whether it needs to or not. It just gets changed on a regular basis. Using IoT technology, we can tell them exactly when to change that filter. Therefore, IoT saves on the cost of the filter and the cost of the manpower—and those types of potential efficiencies and savings are just one small example of the things that we’re trying to accomplish.
Maintaining continuous functionality
Smith: It points to the uniqueness of the people-level relationship between the HPE team, our partners, and the Texmark team. We are able to have these conversations to identify things that we haven’t even thought of before. I could give you 25 examples of things just like this, where we say, “Oh, wow, I hadn’t thought about that.” And yet it makes people safer, and it all becomes more efficient.
Gardner: You don’t know until you have that network in place and the data analytics to utilize what the potential use cases can be. The name of the game is utilization efficiency, but also continuous operations.
How do you increase your likelihood or reduce the risk of disruption and enhance your continuous operations using these analytics?
Smith: To answer, I’m going to use the example of toll processing. Toll processing is when we would have a customer come to us and ask us to run a process on the equipment that we have at Texmark.
Normally, they would give us a recipe, and we would process a material. We take samples throughout the process, the production, and deliver a finished product to them. With this new level of analytics, with the sensoring of all these components in the refinery of the future vision, we can provide a value-add to the customers by giving them more data than they could ever want. We can document and verify the manufacture and production of the particular chemical that we’re toll processing for them.
Fuller: To add to that, as part of the process, sometimes you may have to do multiple runs when you're tolling, because of your feed stock and the way it works.
By using advanced analytics and the predictive benefits of having all that data, we're looking to gain efficiencies.
By using advanced analytics, and some of the predictive benefits of having all of that data available, we're looking to gain efficiencies to cut down the number of additional runs needed. If you take a process that would have taken three runs and we can knock that down to two runs, that's a 30 percent decrease in total cost and expense. It also allows them to produce more products and to get it out to people a lot faster.
Smith: Exactly. Exactly!
Gardner: Of course, the more insight that you can obtain from a pump, and the more resulting data analysis, that gives you insight into the larger processes. You can extend that data and information back into your supply chain. So there's no guesswork. There's no gap. You have complete visibility, and that's a big plus when it comes to reducing risk in any large, complex, multi-supplier undertaking.
Beyond data gathering, data sharing
Smith: It goes back to relationships at Texmark. We have relationships with our neighbors that are unique in the industry, and so we would be able to share the data that we have.
Fuller: With suppliers.
Smith: Exactly, with suppliers and vendors. It's transformational.
Gardner: So you're extending a common standard industry-accepted platform approach locally into an extended process benefit. And you can share that because you are using common, IT industrywide infrastructure from HPE.
Fuller: And that's very important. We have a three-phase project, and we've just finished the first two phases. Phase 1 was to put ubiquitous Wi-Fi infrastructure in there, with the location-based services and all of the things to enable that. The second phase was to upgrade the compute infrastructure with our Edgeline compute and put in our HPE Micro Datacenter in there. So now they have some very robust compute.
With that infrastructure in place, it now allows us to do that third phase, where we're bringing in additional IoT projects. We will create a data infrastructure with data storage, and application programming interfaces (APIs) and things like that. That will allow us to bring in a specialty video analytic capability that will overlay on top of the physical and logical infrastructure. And it makes it so much easier to integrate all that.
Gardner: You get a chance to customize the apps much better when you have a standard IT architecture underneath that, right?
Trailblazing standards for a new workforce
Smith: Well, exactly. What are you saying, Dana is—and it gives me chills when I start thinking about what we're doing at Texmark within our industry—is the setting of standards, blazing a new trail. When we talk to our customers and our suppliers and we tell them about this refinery of the future project that we're initiating, all other business goes out the window. They want to know more about what we're doing with the IoT—and that's incredibly encouraging.
Gardner: I imagine that there are competitive advantages when you can get out in front and you're blazing that trail. If you have the experience, the skills of understanding how to leverage an IoT environment, and an edge computing capability, then you're going to continue to be a step ahead of the competition on many levels: efficiency, safety, ability to customize, and supply chain visibility.
Smith: It surely allows our Texmark team to do their jobs better. I use the example of the millwrights going out and inspecting pumps, and they do that every day. They do it very well. If we can give them the tools, where they can focus on what they do best over a lifetime of working with pumps, and only work on the pumps that they need to, that's a great example.
I am extremely excited about the opportunities at the refinery of the future to bring new workers into the petrochemical industry. We have a large number of people within our industry who are retiring; they’re taking intellectual capital with them. So to be able to show young people that we are using advanced technology in new and exciting ways is a real draw, and it would bring more young people into our industry.
Gardner: By empowering that facilities edge and standardizing IT around it, that also gives us an opportunity to think about the other part of this spectrum—and that's the cloud. There are cloud services and larger data sets that could be brought to bear.
How does the linking of the edge to the cloud have a benefit?
The crystal ball for IIoT in refinery
Fuller: Texmark Chemicals has one location, and they service the world from that location as a global leader in dicyclopentadiene (DCPD) production. So the cloud doesn't have the same impact as it would for maybe one of the other big oil or big petrochemical companies. But there are ways that we're going to use the cloud at Texmark and rally around it for safety and security.
Utilizing our location-based services and our compute, if there is an emergency, whether it's at Texmark or a neighbor, using cloud-based information like weather, humidity, and wind direction—and all of these other things that are constantly changing—we can provide better directed responses. That's one way we would be using cloud at Texmark.
When we start talking about the larger industry—and connecting multiple refineries together or upstream, downstream, and midstream kinds of assets together with a petrochemical company—cloud becomes critical. And you have to have hybrid infrastructure support.
You don't want to send all your video to the cloud to get analyzed. You want to do that at the edge. You don't want to send all of your vibration data to the cloud. You want to do that at the edge. But, yes, you do want to know when a pump fails or when something happens so you can educate and train and learn and share that information and institutional knowledge throughout the rest of the organization.
Gardner: Before we sign off, let’s take a quick look into the crystal ball: refinery of the future, five years from now. Doug, where do you see this going?
Smith: The crystal ball is often kind of foggy, but it’s fun to look into it. I had mentioned earlier opportunities for education of a new workforce. Certainly, I am focused on the solutions that IoT brings to efficiencies, safety, and profitability of Texmark as a company. But I am definitely interested in giving people opportunities to find a job to work in a good industry that can be a career.
Gardner: JR, I know HPE has a lot going on with edge computing, making these data centers more efficient, more capable, and more rugged. Where do you see the potential here for IoT capability in refineries of the future?
Future forecast: Safe, efficient edge
Fuller: You're going to see the pace pick up. I have to give kudos to Doug. He is a visionary. Whether he admits that or not, he is actually showing an industry that has been around for many years how to do this and be successful at it. So that's incredible. In that crystal ball look, that five-year look, he's going to be recognized as someone who helped really transform this industry from old to new economy.
You're going to see the pace pick up. We're going to get faster, smaller, cheaper, and become more ubiquitous.
As far as edge-computing goes, what we're seeing with our converged Edgeline systems, which are our first generation, and we've created this market space for converged edge systems with the hardening of it. Now, we’re working on generation two. We're going to get faster, smaller, cheaper, and become more ubiquitous. I see our IoT infrastructure as having a dramatic impact on what we can actually accomplish and the workforce in five years. It will be more virtual and augmented and have all of these capabilities. It’s going to be a lot safer for people, and it’s going to be a lot more efficient.
Gardner: I'm afraid we’ll have to leave it there. We have been exploring how IT combines with the Internet of Things and modern operations methods to create the refinery of the future. And we've learned how a leading-edge chemical processing company in Texas is rethinking data gathering analysis to foster a safer working environment, as well as greater efficiency.
Please join me in thanking our guests: Doug Smith, CEO of Texmark Chemicals in Galena Park, Texas. Thank you, sir.
Smith: Thank you. This was lot of fun, Dana.
Gardner: We’ve also been here with JR Fuller, worldwide business development manager for Edgeline IoT at Hewlett Packard Enterprise. Thank you, JR.
Fuller: Thank you sir. It’s been a pleasure.
Gardner: And a big thank you to our audience as well for joining this BriefingsDirect Voice of the Customer digital transformation success story. I'm Dana Gardner, principal analyst at Interarbor Solutions, your host for this ongoing series of Hewlett Packard Enterprise-sponsored interviews. Thanks again for listening. Please pass us along in your IT community if you found it valuable, and do come back next time.
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This article/content was written by the individual writer identified and does not necessarily reflect the view of Hewlett Packard Enterprise Company.