McDermott Sees Gains From RFID Tracking in Indonesia

Apr 18, 2012McDermott Inc., an offshore engineering and construction firm headquartered in Houston, Texas, is reviewing the results of a 10-month-long radio frequency identification pilot. Once this is complete, the company hopes to expand the project to additional sites.

At its facility on the Indonesian island of Batam, McDermott fabricates metal pipes for installation within a processing platform or plant. The company tested the use of EPC Gen 2 passive ultrahigh-frequency (UHF) RFID tags to track the pipes throughout the fabrication process, as well as monitor the items stored in the laydown yard, in order to help improve planning, work execution, progress reporting and materials management.

Michael Smith, McDermott's global manager of industrial engineering, fabrication and marine global project services, says the pilot proved that RFID could be employed to track the metal items throughout the facility, whether indoors or outdoors. Supplemental read data collected during the fabrication process could help to improve multiple facets of planning, scheduling and work management. Based on the pilot's results, he says, McDermott could expect to recoup its investment within six months, by reducing the amount of labor workers spend conducting inventories, and by improving efficiency, since the company would know where each pipe was located.

McDermott is composed of engineering, procurement, construction and installation divisions focused on executing complex offshore oil and gas projects worldwide. The company provides fixed and floating production facilities, pipelines and subsea systems, and its customers include national and major energy firms. Each project is custom-made, with the materials used varying and dependent on the particular product, location and customer.

Managing project and work execution can be difficult due to limited information or materials, the company reports, and is further complicated when multiple projects are underway at any given time. In some cases, work may be pulled ahead of schedule or out of sequence—for example, if the materials necessary to make a specific item become available, in which case that item could be created and then wait in the laydown yard. Locating pipes, however, was not always easy. Printed bar-coded labels were sometimes difficult to read, due to the pipes' orientation.

While developing the RFID solution, McDermott spent several months carrying out preliminary testing of hardware and software, in order to ascertain the appropriate mix. In designing the pilot, Smith says, the group sought RFID tags and handheld readers that would enable staff members to locate tagged items quickly within the 300-plus-acre facility, whether in the shop or in laydown areas. The team selected Alien Technology's Squiggle EPC Gen 2 UHF RFID tags, as well as Convergence Systems Ltd. (CSL) CS101 handheld readers with GPS receiver modules.

The RFID-based data was collected by STATS software, developed by McDermott and integrated into the project's SQL database. That information, including the location at which each item's tag was read (based on the handheld's GPS reading), along with the tag's unique ID number, was linked to its description in the back-end system. For work execution and capacity planning, McDermott deployed software supplied by Global Shop Solutions.

When a pipe work order was released, RFID labels were printed and encoded with a Datamax-O'Neil M-4210 Mark II printer, while information about that pipe was stored in the company's back-end database, along with the ID number. The tags were then read as the items moved from one work area to another—for example, to a different workstation. Workers interrogated the tags using a CS101 handheld reader, and input any necessary updates regarding the process underway on a particular part.

The system was tested within the facility's steel pipe shop, where pipes, flanges and other materials are processed according to each work order. The pipe-fabrication process typically includes pipe cutting, fit-up (in which pieces are fit together), welding, inspection, blasting and painting.

At present, between 4,500 and 5,000 pipes have been tagged with two RFID labels apiece—one on each end. The environment is rough, Smith says, adding that no single tag could survive the entire assembly process. "Initially, we tested using hanging tags, but preference was to attach tag directly to pipe," he explains. "We investigated using substrates, but available materials were limited." Smith's RFID development group initially utilized door insulation foam and yoga mats procured at a local hardware store. "We tested over a dozen material types until we found one that was workable."

The pipes' tags can be read upon entering each workstation or within the laydown yard, via the GPS-enabled handhelds, offering operations personnel a view into each pipe's location along the fabrication process, as well as while being stored in the yard. "The system provides visibility on the shop floor and laydown areas for status and location," Smith states.

During the time of the pilot, Smith says, the shop experienced an estimated overall process productivity improvement of 7.2 percent, based on improved visibility into work-in-progress and items stored within the laydown yard. Altogether, he notes, the system hardware and software cost less than $60,000.

Smith described the pilot at RFID Journal LIVE!, held earlier this month in Orlando, Fla., where he noted that McDermott is still using RFID to track pipe spools. Pipes are scanned upon entering or leaving the laydown yard, and employees can conduct inventory scans using a handheld reader. He says he hopes to test the system at another location, but that he is first awaiting management's response to the Indonesian pilot.