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Tips for extending the life of your asset, to maximise oil recovery

24 February 2020 by Danny McGowan

Extending the life of an asset has become more and more prevalent over the last 5-10 years, as companies strive to maximise oil recovery and future proof existing infrastructure. And there can be huge commercial gain for operators if done effectively and efficiently.  

Danny McGowan, our Operations Manager, has 30+ years experience in the oil and gas industry, and in this blog post he discusses the importance of considering asset life extension. He also provides insights into the two biggest problems faced by Asset Managers when planning to extend. 

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Developing an asset life extension strategy

“The design life of your asset may be 25 years, so if you’re going to extend to 40 years plus, you have a duty to ensure the equipment and systems are all still fit for purpose with a license to operate, and to ensure the integrity and safety of the plant.

“There ultimately needs to be an economic case to extend. Will there be enough return on investment to justify the work required?

“There are a few steps we’d recommend taking to determine the best route for extension: 

  1. Review the current condition of the asset in terms of equipment, as well as factors such as technology and sparing
  2. Compare this against the desired capacity for the next 5-10 years
  3. Develop a cost-effective strategy that will keep equipment operable and safe for that extended period. For example, are you going to replace or update equipment, or make design modifications to the plant?

“However there are two common problems that you can come up against - integrity and obsolete equipment…”


1. Integrity of overall infrastructure

“When reviewing the infrastructure of your asset, there are key areas that must be assessed and benchmarked, and this typically includes vessels, pipework, valves and structures. You need to check that they are fit-for-use and in a position to extend the life of an asset under its new operating parameters. 

“This allows you to identify the state of the equipment you have, and identify any red flags that need rectified as a priority. For example, if a critical piece of equipment is damaged, are you going to repair or replace?

“However a major challenge here is hidden failures, that are not necessarily visible. These would be classified as amber flags, for example corrosion under pipe supports (CUPS) or pipe wall and equipment thinning. These issues may not cause any problems in the short term, but could be detrimental 10 years down the line.

“You need to do this full assessment so you have the foresight to develop the best approach to managing all potential risk for the extended period. There are many approaches that can be adopted, such as shutdown programmes, pipework replacement, and so on. 

“This also gives you insight into how much it’s going to cost to maintain the plant, and enables you to work out the optimum time to start looking at decommissioning or see that the plant has degraded so far that this is no longer viable.”

2. Obsolescence

“Discovering obsolete equipment is common when developing your asset life extension strategy, and this can be a costly problem to face. 

“There are different strategies that can be adopted to counteract against obsolescence, but the 3 key approaches are: 

  • Decommission 
  • Replace, refurbish or re-engineer
  • Maintain (which will likely include increase the maintenance conducted to decrease the likelihood of failure)

“I would always recommend doing a cost-benefit analysis to determine the best option. If you are considering replacement, what is the return value? Unless the equipment is safety critical, replacement might not be the best approach. 

“Also, if you choose to keep operating with the obsolete equipment and simply increase the maintenance, there is still a risk as spares are unavailable. If it fails, what is your contingency plan for reengineering or retrofitting?” 

How can Add Energy support with asset life extension?

Add Energy has the ability to provide processes to look at asset life extension as a whole, as well as deep knowledge and experience within niche areas, including maintenance and obsolescence. We can offer advice and support, as well as review and develop full asset life extension strategies.

Typically this has been a very siloed approach - where integrity would look at integrity, engineering would look at the processes and equipment, and commercial would look at the economics.

We integrate all of this so that the whole picture is clear, and create a roadmap. We offer a blend of specialists that can:

  • Review and analyse available data
  • Develop a suite of recommendations that will enable you to extend as efficiently as possible with maximum return on investment
  • Manage obsolescence through data mapping and visualisation
  • Prioritise our recommendations
  • Design solutions for the issues we find  and problem solve
  • Implement recommendations for you, if you don’t have the capacity or expertise to do this in-house



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