Beyond Non Productive Time (NPT) : Effective Production Time
With the increasing downward pressure on oil prices, drilling contractors and operators are becoming more focused on improving ROI by reducing the cost of owning and operating drilling and production assets. Considerable attention is already given to evaluating and reducing NPT. When an asset is down it is not producing any revenue for the owner and is costing the operator time and money in drilling services and production delays.
Equally important to reducing NPT, however, is increasing the productivity of the asset during its “productive time” which can have just as large an impact on the overall cost of operating the asset. An asset with higher productivity will cost less to operate, result in shorter drilling campaigns and produce increased ROI for the operator.
There is a fundamental and critical difference between the term “productive time” as used in NPT and the “productivity” of an asset. Productive time measures if the system is working or not. Productivity on the other hand addresses how well the system is working while it is productive. An asset that has acceptably high productive time but unacceptably low productivity can still lose money for the owner by taking longer than expected to complete a drilling campaign. Productivity determines if the expected amount of work gets done during the available productive time.
Understanding the relationship between the metrics “productive time” and “productivity” is key to optimizing performance. Selecting the wrong metric to improve can be costly and result in little or no improvement of the asset’s overall ROI. In many cases, improving productivity can yield a significantly better ROI than improving productive time. On an asset with low NPT, investing in a marginal increase in productive time will likely have less impact than improving productivity.
While it is relatively straightforward to measure productive time on a given asset, measuring productivity on that asset is significantly more complex. Productivity can be defined as the ratio between efficiency of a process and the effectiveness of that process. The efficiency of a process is a measure of the resource consumed to run the process. The effectiveness of a process is the ratio between the expected throughput and the actual throughput. In a simple drilling process analysis example, efficiency could be represented by the dollar cost of the drill bits consumed to drill to a specific depth, while the effectiveness would be the ratio between the planned rate of penetration (ROP, in feet per hour) and the actual ROP achieved. Achieving the optimum productivity requires achieving a balance between efficiency (consuming more or less resource) and effectiveness (achieving an actual throughput close to the expected throughput).
Optimizing productivity is a complex operational task that goes well beyond recording the basic uptime of the equipment. It is completely dependent on first being able to identify and measure the correct operational parameters of the asset then being able to stabilize and characterize the performance of the asset as indicated by those operational parameters. The failure to identify the relevant measurement parameters, and then stabilize and fully characterize them is the single largest reason for the failure of productivity improvement efforts.
There is an extensive body of knowledge and experience readily available to understand the relationship between productive time and productivity. Understanding and leveraging this body of knowledge is the first step to reducing the risk of failure in a productivity improvement project and ensuring that any efforts to improve the productivity of your asset are successful. Athens Group consultants have worked with and contributed to this body of knowledge for over a decade and can provide the expertise and Proven PracticesSM Methodologies to assure a successful productivity improvement process. Contact us today for more information.
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