RFID Helps Fuel an Oil Boom

By Michael Belfiore

Bantrel deployed a material-tracking solution to locate 70,000 parts during the construction of a multibillion-dollar tar-sands project in northern Canada.

The oil (or tar) sands in northern Alberta, Canada, contain large deposits of bitumen, a crude form of petroleum. It is estimated that these sands will yield 170 million barrels, worth $1 trillion. But building the structures, steam generators and pipelines required to extract bitumen from deep below the ground is a time-consuming, labor-intensive and expensive process. Workers armed with little more than paper lists generated from a material-procurement database and maps accept deliveries of the miles of pipe and tens of thousands of parts needed for construction. Weeks or months later, they must then locate the materials to assemble them. It's particularly challenging when the laydown yards become covered with snow during the long winter months.

In 2011, Bantrel, a Canadian subsidiary of U.S. construction giant Bechtel, decided to try a different approach for a new tar-sands project it was building in northern Alberta: RFID tracking and GPS mapping for placing and locating parts. Bantrel wanted to bring construction material management for the new facility technologically up to date, in order to shave costs and get the oil flowing as soon as possible.

Several spools in the snow

Parent company Bechtel had previously facilitated a pilot study to research the use of RFID technology to track material during the construction of a two-unit power plant with good results. During the pilot, which took place in 2007, Bachtel erected the steel for one unit using the old-fashioned, paper-intensive method, and built the other using RFID to track the steel pieces needed for construction. The unit employing RFID-enabled tracking went up faster due to increased worker productivity. "After that project, we continued use of the technology on other projects," says Ed Koch, a product manager at Bechtel who assisted during the pre-deployment phase of the Bantrel oil-field project.

John Walker

RFID seemed like a natural fit for countering the unique challenges of building out a new oil field so far north, Koch says. "They were going to not want to have their construction resources exposed to the elements any longer than they needed to," he explains. "They wanted to be able to find the material quickly." Time there is at a premium, because most construction must be completed before the winter hits, with its sub-zero-Fahrenheit temperatures and long-lasting snow cover.

Bantrel contracted with Atlas RFID Solutions, based in Birmingham, Ala., to develop and implement an RFID material-tracking solution. Currently, the company says, with construction nearly complete, the RFID system has more than proven its worth. Project managers estimate that the solution has helped avoid up to $11.7 million in construction costs for the multibillion-dollar project.

Laying the Foundation
Bantrel formed an evaluation team with representatives from the construction departments of both Bantrel and its client, an oil company that wishes to remain anonymous. Ray Johnson, Bantrel's manager of technical services, and Sarab Bhogal, a lead field engineer, defined the project's scope. In the summer of 2011, the team issued a request for proposals for competitive bidding. Atlas was selected for the job based on its price and existing software capabilities, and due to its prior experience with large industrial projects, as well as with Bechtel's processes and systems.

Atlas was new then, with fewer than 20 workers. Employee number 17 was Jeff Braune, who was tapped to manage the deployment at the job site, as well as at the four sites throughout Canada where individual sections of pipe (known as pipe spools), cable reels, valves and other materials were to be fabricated.

A worker associates each part's ID number with the tag using a handheld reader.

On the Bantrel side, John Walker, the company's materials manager, who had previously worked at Atlas RFID Solutions, was selected to oversee the RFID deployment. Since his initial visit to the job site in March 2012, Walker says, "I've been up here full-time, commuting back and forth from Birmingham since about July 2012."

Building a Solution
Convincing suppliers to tag some 70,000 assets as part of their manufacturing processes was the most challenging part of the project, Braune says. The team was leaning toward Identec Solutions' i-B2 active RFID tags, which were designed for harsh conditions and had a long battery life, but "we were very concerned about the projections for battery life in a cold environment," Johnson says.

Atlas alleviated these concerns by conducting its own quality-control tests on the Identec tags. "We do have an RFID engineer," Braune says. "We have a pretty rigorous certification process that we go through," including submersion, temperature and RF tests. "Obviously, the manufacturers have those types of specifications, too. We just verify them."

The weather was warm when Braune and his colleagues arrived at a Bantrel marshalling yard that served the job site in spring 2012, but they knew the clock was ticking. They had to get the RFID system up and running before the onset of the long, hard winter. Construction materials had already begun arriving by truck. The RFID deployment team began by briefing Bantrel's managers and IT staff on how the RFID tracking system would work, as well as configuring the 30 to 35 Trimble Nomad 9300 readers that were to be put into service at the site.

Once the system was in place, Braune and Walker began visiting the four facilities where the pipe spools and other materials were being fabricated. "One of the things that was a challenge in the beginning was having some sort of commercial arrangement in place for the fabricators to attach and associate the RFID tags," Braune says. "[I, along with] John Walker and the project-procurement manager at the time on the project, went to these folks and trained them how to do it."

A handheld can be used to read the tags of spools in snow.

Contrary to the fabricators' fears, Braune adds, the process was relatively simple to implement. Braune and his Atlas team hand-delivered two Trimble Nomad 9300 handheld readers to each fabrication facility, and tags were shipped separately. Plant workers first write an ID number on each part using a paint pen, affix a bar code, and then attach an Identec i-B2 to each part via a zip tie. From there, a worker associates each part's ID number with the tag using a handheld reader. Employees at the constructions site followed the same process to tag the materials that had already arrived.

After tagging all of the parts making up a shipment, factory workers create an electronic packing list before sending the items to the job site by truck. Upon arriving at the construction site, the delivery trucks pass through gates outfitted with Identec iPORT chokepoint readers. Antennas provided by Microelectronics Technology Inc. (MTI), Laird Technologies and Mobile Mark allow the readers to interrogate the tags and register them in Atlas's Jovix software, a Web-based application that tracks every part's status and location.

As each part is unloaded in the laydown yard, workers use the GPS feature in the handhelds to register each part's location. All of the collected data is logged to Jovix. Vehicle-mounted readers and antennas of the same make and models, with the addition of a tablet PC in each vehicle, later assist workers in updating the GPS location of materials that may have moved.

Jovix has an additional important job to do: sharing the receipt and location data with Bantrel's procurement and material-tracking software, known as the Bechtel Procurement System (BPS). Since Jovix and BPS use two different database platforms (SQL and Oracle, respectively), some work had to be done to get the two systems to synchronize properly. For the most part, Braune reports, integrating the two packages went smoothly. "Any time there's a system integration, that's always a challenge," he says. "Bantrel's has actually been very smooth, after the first five or six months of going through it and making minor tweaks and changes."

Reaping the Benefits
Now that the construction phase of the project is winding down, Bantrel and its oil company client can plainly see many of the benefits of the RFID material-tracking solution.

A close-up view of a tagged spool

During the first two years of operation, Atlas and Bantrel estimate, the RFID system allowed them to avoid approximately $11,775,608 in costs. Even with the additional cost imposed by active tags—up to five times as much as with passive tags—the system yielded an estimated 467.6 percent return on investment. Much of that return has come from a reduction in hours employees spend locating materials in the laydown yard. The team estimates that the average time spent locating parts in the field decreased by two-thirds, from 15 minutes on average per part down to just five minutes. That's time that workers can now use more productively in other ways.

In addition, Bantrel reports, an estimated 10 percent of materials delivered to a typical oil-sands construction site and manually tracked using pen and paper are not easily found, and can take hours to locate. Of these, some 5 percent may never be recovered, requiring that those items be re-procured. During the two years studied since the implementation of the Atlas RFID system, only three pipe spools had to be ordered again, versus an estimated 150 that would have had to be re-ordered in the past.

Meanwhile, Bantrel and Atlas RFID Solutions are looking ahead to what RFID can do for the oil-sands project after the construction phase is completed and the production phase begins, which is expected to take place sometime in 2015. Since RFID tags have been kept on mechanical equipment, such as pumps and motors, even after installation. One possible future use for the system is to turn Jovix over to plant operations managers, which would allow them to track maintenance schedules and issues involving equipment in operation.