When Mega Goes GIGA Joseph C. Brewer, Jr. Dow Chemical VP Sr. - PowerPoint PPT Presentation

Theme: Annual Conference Theme When Mega Goes GIGA Joseph C. Brewer, Jr. Dow Chemical VP – Sr. Consultant, Capital Project Delivery Sadara – Chief Implementation Officer № Year: Date: Location: 49 2017 Sept. 6-9 Boca Raton, FL

Today’s Objectives: Introduce the Sadara Project • Discuss a Few of the Unique Challenges… • When Mega Goes GIGA Latitude 26.94, Longitude 49.48 When Mega Goes GIGA

Sadara - Company Overview Å Joint Venture: Dow Chemical & Saudi Aramco Å Twenty-Six World Scale Production Units Å Extensive OSBL, Infrastructure & Off-Plot Å Location: Jubail, Eastern Provence, Saudi Arabia Å Initial Memorandum of Understanding – May2007 Å Company Incorporation – Oct2011 When Mega Goes GIGA

Sadara - Project Overview Å Largest Petrochemical Project Ever Designed & Built at One Time Å 27 Project Teams Å 25 Engineering Offices Worldwide Å 100+ Construction Contractors Å Peak Site Staffing: 60,000 Workers Å 0.033 Total Recordable Incident Rate Å Nominal $20B Investment When Mega Goes GIGA

Location Jubail When Mega Goes GIGA

Location Jubail When Mega Goes GIGA

1.3 Miles 1.9 Miles When Mega Goes GIGA

When Mega Goes GIGA

4 Dimensional Organization Program Officers Project Project Project Project Project Project Project Director Director Director Director Director Director Director PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM PM Project Engr. Process Engr. Process Control Construction Scheduling Contracting Operations Cost Mgmt. Design Engr. Purchasing Cost Estimating Org Effectiveness ECA Implementation Quality EH&S Site Integration HR Support 1 st Product Team Contractors & Suppliers When Mega Goes GIGA

Timeline 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1 st Product Authorization Initial JV LOI Gate Review Feasibility Studies FEED Design Construction Startup When Mega Goes GIGA

Sadara Configuration Market Segments Specialty Films Products Household Products Isocyanates Polyurethane Foams Polyols PlasChem Park Propylene Glycol Adhesives/Sealants Ethylene Oxide Paints & Coatings Propylene Oxide Ethane Laminates Sadara Solution PE Oil & Gas Chemicals Elastomers Glycol Ethers Detergents Amines Water Treatment Intermediates Naphtha Cables Raffinate Construction Material Pygas Additives Pyoil Furniture/Insulation Automotive Fluids Auto Components When Mega Goes GIGA

When Mega Goes GIGA

When Mega Goes GIGA

Title of Presentation

When Mega Goes GIGA

When Mega Goes GIGA

Title of Presentation

When Mega Goes GIGA

When Mega Goes GIGA

Unique Challenges… When Mega Goes GIGA When Mega Goes GIGA

Topics Å The Core Challenge Å Nonlinearities Å New Capabilities Required Å Contracting Potpourri Å Back to Fundamentals When Mega Goes GIGA

The Core Challenge When Mega Goes GIGA

The Core Challenge: GIGA is a “Supply” Problem Rate of Decision Making Equipment Owner Suppliers Personnel Bulk Material PMC Suppliers Personnel Consumables Design Suppliers Engineering Financing Skilled Arrangements Labor Feasibility Cash Technical FEED Flow Experts Design Procure Construct Commission & S/U When Mega Goes GIGA

Concentrate the Buy – But Don’t Hurt Yourself Å Program Leveraged Pricing Agreements Can Deliver Significant Savings Å GIGA Volumes Can Bring Very Low Prices Å GIGA Volumes Can Overwhelm Suppliers Å GIGA Must Limit the Volume Committed to Any One Supplier Å GIGA Must Maintain a Higher Expediting/Inspection Presence When Mega Goes GIGA

Strategic Sourcing Å What Volumes Will You Buy that the Market Will Struggle to Supply? – Rotating Equipment? – Analyzers? – Special Metallurgy? – Switchgear? – Etc… Å Pinch Points Require Special Mitigation Efforts When Mega Goes GIGA

Nonlinearities When Mega Goes GIGA

GIGA is Not an Extrapolation of Your Past Experiences Effort & Expertise Required GIGA Small Large Mega Project Size When Mega Goes GIGA

Examples of GIGA Nonlinearities Å FEED Iterations – Massive Parallel Optimizations Å Interface Management – The Number & Complexity of Interface Points Å Change Management – The Domino Effect Å Risk Management – On Steroids Å Personnel Turnover Å Learning & Leveraging Å Black Swans Redefined – Typically Small Risks are Now Large When Mega Goes GIGA

New Capabilities Required When Mega Goes GIGA

New Capabilities Required by GIGA Å A Four-Dimensional Organization with Proactive Morphing Å Standardization Plus Å Office of Intervention Å Integrated Asset Delivery Å Strategic Float Å Staying Aligned – Organizational Effectiveness Å 1 st Product Team Å Proactively Managing ‘Black Swans’ When Mega Goes GIGA

Small Things that Grow Up to be Big Å Attracting & Retaining Talent Å Career Management Å Financing Support Å Community Relations Å Construction Workforce Marshalling When Mega Goes GIGA

Contracting Potpourri When Mega Goes GIGA

There is No Single Contracting Style that Fits GIGA Å OSBL/Infrastructure is Always Late Getting its Process Data, but Must Startup 1 st Å Attracting Sufficient Bids Requires a Mix of Contracting Types Å Newer Technologies are Still On Their Learning Curves – Scope Changes Likely Å It’s Best Not to Let the Market Split Up Your Packages – Scale Them to the Market Å The Result: All Types of Contracts for which You Need to Be Prepared to Manage When Mega Goes GIGA

Back to Fundamentals When Mega Goes GIGA

GIGA is Intolerant of Forgetting to Do the Basics Well Å Full Staffing of Project Teams with Experienced Personnel Å Complete & Robust FEL Work & FEED Packages Å Full Implementation of Value-Improving Practices Å Benchmarking Å Gate Reviews Å Integrated, Backward Pass, Resource Loaded Scheduling Å Progress & Critical Path Monitoring & Reporting Å Robust Change Management Å Vigorous Risk Management Å Proactive Contract Management When Mega Goes GIGA

GIGA is an Unforgettable Roller-Coaster Ride! When Mega Goes GIGA

But Allows You to Achieve Things No One Else Has Achieved. When Mega Goes GIGA

Theme: Annual Conference Theme When Mega Goes GIGA Q&A № Year: Date: Location: 49 2017 Sept. 6-9 Boca Raton, FL