The Mod Squad

Better modular design prepares sector for turbo-charged activity

Call it the calm before the storm - or perhaps the lull between two storms, a summer wind and a hurricane, might be a better appellation for this fall's somewhat lower level of activity in the province's pipe rack and process equipment module construction and assembly sector.

The lion's share of the sector's product in recent years has gone to oil sands projects. With most of the work done on three huge projects - Shell Muskeg River, Syncrude UE1 and Suncor Millennium - which accounted for a major chunk of the module assembly done in the province from 2001 to 2005, about 120 modules are currently standing in yards being built. "It was at least twice as busy a year ago," says Gary Cutmore, Lockerbie and Hole's Sherwood Park-based business development manager.

Although assembly on some of the 490 modules required for CNRL's Horizon Phase 1 will account for much of the sector's work between now and next summer, activity levels should ramp up as more work on other projects gets underway. Just two projects, Suncor Firebag Phase 3 and the Shell upgrader expansion at Scotford, will need, respectively, 531 and 800 modules.

Although a forecast that Cutmore has developed suggests that these two projects should account for much of next year's module assembly, they aren't the only ones in the works for the period. Work will continue on CNRL's Horizon and a few smaller oil sands projects will require modules in 2007. If the projects go ahead on schedule, about 400 modules could be under assembly next summer. That's more than three times the current amount.

The busiest period for oil sands-related module assembly in the province is expected between January 2008 and late summer of 2009 - with a projected peak level of activity in the first quarter of 2009 with some 880 modules being assembled.

Throughout much of the period from early 2008 to July 2009 about 700 to 800 are expected to be under assembly at any one time. Cutmore notes, however, that "this could be out by 10 to 20 per cent." The forecast is based on all projects going ahead as per the most recent announcements.

Derek McEwan, a dispatcher and scheduler with Mammoet Canada Western Ltd., part of a Dutch corporation specializing in the lifting and transport of large, ultra-heavy industrial equipment, is keeping a weather eye on future numbers of modules requiring transport. He expects the module total requiring transport this year to be about 1,015, based on an activity forecast he's seen. This total should dip to around 640 in 2007 before tripling to about 2,200 in 2008 and dropping to around the 1,360 mark in 2009.

With modules typically around 100 feet long, 20-25 feet high and as many feet wide, the forecast numbers for module assembly translate into a lot of activity in the next couple of years.

The sector's capacity will be likely stretched to the limit. The anticipated upward spiral of demand for modules for a host of projects set to start construction in 2008 and 2009 is prompting owners to book assembly yards a year or two in advance.

It's also prompted a company that had at one time a significant presence in Alberta to re-connect with the province. As Frank Taugher, the manager of a soon to be completed module yard operated by Commonwealth Construction, points out, the company he works for built the Banff Springs Hotel. That was back in the 1920s. Today the company, now a subsidiary of Veco Corporation, has recently been awarded three oil sands contracts for Suncor Energy, Albian Sands (Shell Canada Ltd.) and Nexen Inc. The projects are valued at about $200 million.

Commonwealth's Edmonton-area module yard will have capacity to assemble 12 to 14 modules at a time. Prior to setting up the new module yard, which, says Taugher, "should be going full tilt by mid-summer 2007," the company has been doing work for the pulp and paper industry on the West Coast.

Before modules leave the yard, they are hydro-tested and heat-tested, insulated and fireproofed. Installing insulation and fireproofing before transport north to the oil sands improves efficiency - and safety. This kind of work can be done "close to the ground" in the module yard - but not at the field site of operations. "When the modules leave the yard they are basically complete," says Taugher. He expects modular assembly to start at the new yard by late January 2007.

The approach to module design and assembly has evolved significantly since the late 1990s when the current round of new oil sands projects and expansions got underway. "Projects back then were not taking full advantage of the module concept," says Tyler Hanson, the module yard manager for Lockerbie and Hole's operation near Sherwood Park.

"The whole concept of building modules is good for a site program as it moves the need for labour from demand hot spots like the Fort McMurray region to Edmonton. With a good module program in place, you can have a predictable schedule at the site," says Hanson, a mechanical engineer by profession. "Piling, foundation work and other site preparation can be done at the site while simultaneous construction of modules is done elsewhere."

Hanson, who oversaw field construction work for his employer before he began managing the module yard about a year and a half ago, says that the scope of modular assembly has expanded in recent years. "Originally, modules were for pipe racks only. Now, you see full process buildings being done as modules for Syncrude UE1."

The conceptual approach to design has undergone a sea change, and this has helped eliminate a host of time-consuming problems and delays at the field site, says Hanson. It's also improved and helped broaden the application of modular principles.

In the early days of oil sands expansions - about six year ago, modularization was not intrinsic to a plant's design but was more something that was tacked on once the overall design work had been done. The approach was, 'Now we have designed the plant, how should we divide or break it down into components for modularization?' Today, by contrast, the design itself is largely conceptualized and developed via a series of modules. The module has now become intrinsic to plant design. "Earlier, they had to keep tweaking modules to ensure constructability and stability etc. Now, we design to a module," says Hanson.

He outlines the way in which large process buildings being built today incorporate the modular principle. "We did a building four modules high - with 25 feet in height per module. About 20 to 25 equipment modules comprised the building. This is the exact opposite of the traditional long straight runs of pipe rack. So any process building can be broken down to a series of modules. But the modular approach is best suited for densely grouped equipment in a relatively tight space, and not a building with just a few pieces of equipment in it. The greater density of equipment kicks up the efficiency. If an area is not modular these days, you notice that the equipment is widely dispersed."

Design and construction issues of this sort have filtered up to owners and operators, especially if they are big companies with plenty of in-house expertise. Hanson says that owners used to think about only "operability," but that has been changing. Owners are adopting a more hands-on approach and no longer communicate with module assemblers solely via their EPCMs. "They are taking advantage of shorter lines of communication. We are working more with owners directly. They are the ones ultimately on the hook for the overall cost," notes Hanson.

As well as the obvious gains in efficiency stemming from the modular approach, the resulting savings of optimizing module assembly off site are potentially huge, given the scale and stratospheric price tags for oil sands mega-projects. Allan Tarasuk, operations manager at KBR's Edmonton pipe fabrication and adjacent modular assembly facility, pegs the differential between site construction and modular yard work at around 30 per cent.

The improvements in design and broader application of modularization has resulted in a much greater percentage of overall construction is done via modules assembled off site. "Items that were stick built in the field are now modularized. Typically, a few years ago, 35 to 40 per cent was modularized. Now 50 to 60 per cent of components are modularized," says Tarasuk.

One issue that the modular approach has not resolved, however, are the growing wait times for product. Tarasuk says that some components like certain kinds control valves made from specialty alloys can take as much as three years until delivery.

Various high-end components for modules come from overseas. As Gary Trigg, VP and general manager at PCL's pipe fabrication and module facility at Nisku, says, components come from a range of places, including Texas, Italy, the UK and South Africa. But, he says, "We have more control of schedules if products come from a local source."

Some aspects of oil sands facility construction are unlikely candidates for modularization, despite the benefits of the approach. As Stan Shewchuk, the president of Aecon Industrial's Western Canada division, pipe rack modules include fabricated pipe, structural steel and cable trays, among other components, but the electric cable that runs everywhere has to be installed at the site. The modular option just would not be practical in this instance, says Shewchuk.

Although it appears unlikely that full-size 100-feet long, 25-feet high 'Alberta modules' will be shipped from out of province in the near future, several people interviewed for this article had heard of the possibility of smaller modules coming from elsewhere. Such modules, it is said, could be about the size of a rail car container.

This, in a way, it could be said, is happening already. Aecon, which set up its Edmonton operation in 1999, has a plant in Cambridge, Ontario, which produces pie spools for the oil sands. "These can be put on the deck of a flat bed truck and shipped directly to the site," says Shewchuk. As he points out, however, a pipe spool is not the same as a module.

The sheer size of the so-called 'Alberta modules' that are shipped from the Edmonton area has entailed a host of safety-related restrictions on when these behemoths can be transported along the highway. Night-time is out (except in the city where the 80-wheel transport units have to be off the streets before 6 am), as are Sundays, statutory holidays and Fridays after 3 PM.

The trip from the Edmonton area to an oil sands site typically takes between three and six days to complete from loading to unloading. This could take longer if more module assemblers set up facilities that are further away from roads designated part of the high-load corridor. Heavier loads, weighing more than 175 tons, require an additional 'push-truck' at the back. Extra-heavy loads that can weigh as much as 400 tons have to be moved in winter when the ground is frozen. As Derek McEwan, Mammoet's dispatcher, says, "There are a lot of things to be looked at for each load."

2015 ACM MMM Button

2015 ACM Email Button


Free account to gain access to ACM digital editions.