a perspective on managing market changes and planning … 100122... · 2010-01-22 · a perspective...

GE Energy

GE © 2010 – All Rights Reserved

Rice Global E&C Forum Monthly Roundtable

January 22, 2010 | Houston

A perspective on managing marketchanges and planning for the future

GE Energy


Topics

2 /GE © 2009 – All Rights Reserved

• Oil & Gas Industry Environment & Market Realities

• The response ... Discipline & Investment for the Future

GE Energy


Cost indexed2000=100

50

100

150

200

250

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

O&G industry capital cost indices

Exploration & Production

Refining/ Processing

(12%) vs. 2008 peak

(7%) % vs. 2008 peak

Q3 2008

Q3 2008

Source: Cera

Deflation ... Market has reset

120

125

130

135

140

145

150

200020

0120

0220

0320

0420

0520

0620

0720

0820

0920

10

O&G

Mboe/d

Source: EIA

Demand for hydrocarbons has softened

Spare capacity increased

Economic volatility ... investment decisions

But.....hydrocarbon demand still trending upward..........

GE Energy


• Cheap oil is over … with price volatility

• Declining fields - 34% avg. oil recovery … 1% more recovery yields 3 yrs. of production

• New fields remote … new geographies

• End of easy oil … Sour reserves need CO2/H2S handling ... complex reservoirs

• CO2-EOR offers early opportunity for carbon capture & storage

Projected oil demandMbbl/d

20

60

100

120

Mbbl/d

20

60

100

120

‘08 ‘10 ‘15 ‘20

3.5 X Saudi Arabia

1 X Saudi Arabia

10 mbpd35mbpd

Change is Constant ... changed growth

GE Energy


Middle East & North East Gulf

Sub SaharanAfrica

Asia Pacific

North America

Russia/CIS

Latin America

Europe0

2,000

4,000

6,000

Australia and Iraq will play a key role Turbomachinery related additional

oil & gas capacity (project start up 2012-2016)Kboe Deep water

Shallow waterOnshore

Total 26,838 Kboe

Source: PFC Energy, GE O&G internal analysis

Australia … 31%…mainly offshore

Iraq … 29%…only onshore

GE Energy


Monetize stranded gas … Australia LNG

Australia

24

76

2009 201620

100

MTPA

77

Qatar

91

2020• Access to markets …. Asia natural gas demand … +117% 2005 to 2030• Environmental and regulatory sensitivity• Modules technology … restricted local labor

Source: DOE EIA Outlook – May 2009

Natural gas monetization… 90 TCF proven reserves

Aspiration to be the major LNG exporter in 2020

GE Energy


• Oil revenues crucial to rebuild infrastructure

• IOC quickly moving … no fully fledged operating base yet

• Technology upscale

• Security constraints

• Need solid EPC partnership for execution

From 2.4 to 3.3 mbpd by 2012 … targeting 6 mbpd by 2019

Iraq … a key platform for growth

8


Market implications of fiscal stressGovernments driving markets

$ Financialassistance

Industrializednation targets

Developingworld targets

Industrializednations

Developingworld

Efficiency

Stimulus Spending

Energy Security

Jobs

Emissions

Green House Gases

Open R&D

Open Intellectual Property

GE Energy


GE Oil & Gas …. Drilling &Production

LNG &Pipeline

Refinery &Petrochemical

GlobalServices

• Supporting more than 1,000 customers in 115 countries

• Technology and innovation heritage

• Broad and deep domain expertise

IndustrialPower Gen

PipelineSolutions

GE Energy


Discipline

GE Energy


Industry and Gov’t awards Customer awards

EHS excellence … it’s the way we work

Safety Leadership and 1 Million Work Hours awards …

• 5 sites with 5 years and 1 Million + hours

• Zero days away from work

ISO 14001

GE Energy


Complex Business … Built on Operations Discipline

• Costs Rationalized

• Risk Management

• Execution Efficiency

• Process Driven

13


Deliver total quality on products …Tech investments …$100M/y for the next 2 years

Resulting in reduced cycle time … and increased completeness

Quality compliance …2x quality resources

Reduce variation …Product structuring

Meet cost targets …collaborative costs workouts

GE Energy


Our Future:

Developing People

15


Regionalization …Local resources, empowerment & community outreach

Commercial Operations Local execution … shops

• Application Engineers & Commercial Managers deployed regionally

• More direct customer interaction and project development

• New hires & experienced talent

• Doubling Service Center network over 5 years … US, Qatar, Algeria

• Repair time <30% in 2 yrs… Lean

• Technology… Laser cladding …Renewalloy™ … Modular exchange

13 Sales Regions

9 CO/AE Hubs

16


• Almost doubled capacity in 3 years

• Located in 24 countries

• GE vs. 3rd party mix shift ... bringing more service in house

• Doubled training budget in 2009 vs 2008

• Launched Technical Academy …… new hands-on training

• Training path by skill & level … structuredcertification program

Expertise in the fieldField Service Engineers

1.8x

(# of GE FSEs)

Training & development

(Training Khours)

‘09‘08

94 Classroom

Hands-on

Site

14x

‘09‘082007

O&G

GSI

17


Adding Technology Experts

Disciplines:

• Combustion

• Composite Materials

• Advanced Sensors

• CFD

• Power Density

Science

… Plus access to broad GE resources

Products

Disciplines:

• Drilling Systems

• Subsea X-mas Trees

• Rotating Machinery

• Electrification & controls

• Pipeline inspection tools

Adding chief engineers

Systems

Disciplines:

• Drilling Operations

• Flow Assurance

• LNG

• Pipeline

• Refineries

Adding specialistsAdding scientists

18


Sharing expertise & developing talentCollaborating with Academia

& Industry Partners

•Enhancing rotor dynamics analysis and performance

•Optimizing manufacturing techniques and material selection

•Improving testing capabilities for increased equipment reliability & safety

Oil & Gas University

•6 months technology & leadership program for customers

•Now in it’s 9th edition …. over 100 participants from around the world

Addressing oil & gas industry challenges together

19


Our Future:Investing in Technology

20


Service Technology: Remote Monitoring & Diagnostics

e.g., 10% turbocompressor efficiency in brown fields

• RM&D• UCP data download• Site visit

Eng assessmentintegrated performance

asset EnhancementUpgrades for entire train

Recommendation• improved materials• advanced aerodynamics• Re-staging

&

Compressor Gas Turbine

HP

LP

dataMOnitoring

Production data analysis to tailor upgrades … MO.R.E.

GE Energy


Investing for the Future: Technology

LNG ... large heavy duty gas turbines

1st subsea compressor - Blue-C™

Gas storage …Integrated Compressor Line - ICL

World’s largest LNG project …7.8 MTPY capacity

Seal less, oil free compressor …zero fugitive emissions

Total

Qatar Petroleum +

Validating a 12 MW subsea compressor for Ormen Lange

StatoilHydro

Access to $6.0B of research & development yearly

GE Energy


Green Technology

~50% of R&D focused on ECO-solutions

High pressure CO2sequestration

CO2 Capture for Gorgon LNG

Chevron

Advanced Centrifugal pumps for Enhanced Oil Recovery …using compression technology

1st 540 bar CO2reinjection pump

Petrobras

Concentrating Solar Power & other solar thermal technologies

SteamTurbines

Acciona

GE Energy


Results for the IndustryBrazil … Caju’ YardItaly … Avenza Yard

• Exported 40+ yrs module design & engineering expertise to Brazil in 2004

• Built 200+ modules ... most recently P56/57 for Brazil and Kashagan HP barges

• Developed ability to replicate construction locally

Fully capable to construct locally

24


Contact points

Thank You!

Marco CaccavaleTurbomachineryGeneral Manager of Sales [email protected] +1 (713) 458-3673

GE10 PowerGen Module, Adriatic LNG

Inventing the future … together

a perspective on managing market changes and planning … 100122... · 2010-01-22 · a perspective...

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