Talking about standards, BP Group Executive Director Bob Dudley said in his opening remarks at the recent IP Week in London: “I think the idea of everyone having their own designs will soon feel very old-fashioned.”
He was referring to the progress made by the IOGP-managed Joint Industry Programme (JIP) 33, dedicated to standardizing procurement specifications to enable upstream supply chain efficiency. “There is certainly room for improvement,” says Richard Mortimer, Chair of the JIP’s Steering Committee. “In recent years, 75% of large E&P projects exceeded budget by 50%, with scheduling over-runs of 40%.
For the current and future success of our industry, that has to stop. Standardizing procurement specifications is the way forward.”
“Historically, each customer asks their supplier to deliver against a different set of requirements for each order – often hundreds of pages long. They are different even for projects for the same company, it’s incredibly inefficient for the supplier” says the JIP33 Project Director Adri Postema.
JIP33 began in 2016 with support from the World Economic Forum capital project complexity initiative. Following a Pilot of 4 specifications, Phase 2 kicked off in 2017 with the development of a further 12 . “Each is now available online at www.iogp.org/jip33
for use by all operating companies, whether JIP33 members or not,” Richard says. “They should be applied as is, with no further supplements, to enable real standardization and maximize value.”
The LV switchgear specification, one of the first to be completed, has been adopted by a number of operators. User feedback shows the benefits are already being realised, with users already reporting a significant cost and
Phase 3 of JIP33, launched on 31st January, is even more ambitious. The sustained commitment of resources from 12 major operators enables the first tranche alone to cover over 30 specifications. “We chose these in response to a survey that asked member operating companies to identify which would have the most value. These include subsea valves, air-cooled heat exchangers and diesel emergency generators.” says Adri.
Working together with suppliers, JIP33 will allow the procurement process to simplify, standardise and streamline for the whole supply chain.
“By the time we’re finished, procurement in our industry will be transformed,” Richard promises.