Fit-for-Risk Solution for Product Delivery

Client Overview

An integrated oil company refines and transports fuel products across multiple jurisdictions and geographic regions via pipeline to key customers. To prevent quality degradation during transport, the company’s refinery set an internal specification far more stringent than the customer’s requirement.

petroleum production pump

Challenge

To mitigate risks of contamination during pipeline transport and terminal storage, the refinery maintained a conservative internal quality target. However, this meant that premium product was being given away at the customer’s standard price. The quality target also put unnecessary constraints on production, as excessive quality control limited output. There were missed revenue opportunities, leaving significant value on the table.

Objectives

  • Assess whether the internal quality target was justified or if it was too stringent and could be optimized.

  • Develop a risk-based quality approach to ensure the product reached the customer at the right specification.

Results

  • target icon

    offset of internal quality target

    25%

  • magnifying glass icon

    off-spec incidents since the quality target change

    0

  • bar graph icon

    additional revenue

    $3.5M

  • Utilized data-driven approach to tracked fuel quality degradation during pipeline transport

  • Quantified risk of reducing gap between internal quality target and customer specification. 

  • Shifted refinery quality target closer towards customer specification, allowing an increase in fuel production rates.  

  • Customer continues to receive on-spec fuel product, with no reported off-spec quality incidents.

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Crude Oil Production Cost Reduction

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Efficiencies in Product Development and Manufacturing