NGL ’15: Enable Midstream leader touts APC for cryoplant optimization

By ADRIENNE BLUME
Managing Editor

HOUSTON -- William McCandless, vice president of gathering and processing optimization for Enable Midstream, spoke at the NGL Recovery Optimization and Cryoplant Facilities Design 2015 conference about the application of advanced process control (APC) to cryogenic plants, or cryoplants.

Enable Midstream arose from the May 2013 merger of CenterPoint Energy and Energex, and made its IPO in April 2014.

Advanced process control. APC can be applied to cryoplants to enhance flexibility and enable faster response to changing market conditions, McCandless said. Optimization maturity is needed to achieve APC at the operational level. From a corporate perspective, this means managing an asset portfolio with help from access to real-time information, which requires a solid team to analyze and pull from that data on a daily basis.

Overall system profitability can be improved by embracing a holistic approach to plant optimization. This approach, McCandless explained, encompasses five data analysis teams: Market analysis, reporting and metrics, hydraulic modeling, plant/asset optimization, and economic analysis.

At Enable Midstream, the five teams work together in one space, using a variety of software tools to gather, analyze, prepare and share data.

The teams have been working together at Energex/Enable Midstream for nine years. The results of their incorporated data have added 5% to 10% of gross margins through optimizing data analysis and holistic system modeling, McCandless explained.

The objectives and analytical process of each team are outlined below.

Reporting and metrics. This team develops and monitors performance metrics for each of the company's asset under different operating conditions. Analysts examine past operational modes and events, and consider how to improve operations based on these data.

The reporting and metrics team also establishes a baseline for performance from measurements of NGL capacities, recoveries and yields, as well as from fuel utilization and system bypass events.

Hydraulic modeling. After the reporting and metrics team is in place, hydraulic modeling "...is fairly simple, as long as you have good hydraulic modelers," McCandless said.

The hydraulic modeling team develops an understanding of the physical limitations of the assets and establishes asset performance targets. The team conducts physical scenario analyses to discover the range of possible results.

Plant optimization. This team ensures that the company is operating individual assets in an optimal mode on a near-real-time basis, by asking the question: How can the current state be improved?

The team conducts simulation processes to help provide near-real-time feedback to plant operators and recommend optimal performance targets. Plant performance data is stored on an offsite server, and web-based reporting allows analytical staff to view plant performance and coordinate with plant operators.

The plant optimization team carefully examines how plants operate in different weather and temperature conditions, under different operational scenarios, to determine how best to adjust plant operations to maximize uptime and profitability.

Economic analysis. The economic analysis team is tasked to predict, with a high level of certainty, the impact that certain decisions and market adjustments will have on margins, operations and customers.

To understand the range of possibilities, the team must have a thorough understanding of contracts and be able to conduct economic and scenario analyses based on contract options.

Marketing. This team ensures that the company's commodity position is balanced at the best available price while supporting the flexibility of operating assets. An essential question for this team is: How can margins be optimized while minimizing financial risk?

The marketing team relies heavily on production estimates from the modeling team. They must work with operations and logistics to minimize stress on assets and provide guidance to senior management on market direction and movement.

Holistic system modeling. Incorporating data from all five teams results in what McCandless calls holistic system modeling. Based on knowledge of asset capabilities, constraints, contractual obligations and market conditions, the five teams develop a daily plan to maximize margins while projecting production volumes by market.

The holistic system model answers the question: What is the most profitable outcome possible across all assets and contracts, and how can it be achieved?

Ethane rejection decision. McCandless also gave insight into ethane rejection to understand why, at current prices, ethane is still being recovered. The majority of the US market is only rejecting 20% to 30% of ethane, while Enable Midstream is rejecting 80% to 90%.

Several key factors influence the decision to reject ethane:

• The price of natural gas relative to ethane
• Transportation costs
• Barrel-of-oil-equivalent reporting
• Producer settlement terms.

On the last point, McCandless explained that companies tend to recover more ethane when actual ethane recoveries, rather than theoretical recoveries, are outlined in contracts.

The decision to reject more ethane is made based on asset capabilities and the impact on propane recovery levels. A lack of regional infrastructure to extract and move the ethane to market can also influence this decision.

Pipeline quality specifications are another important factor. McCandless gave the example of the Marcellus Shale, where ethane must be rejected to ensure that the gas meets pipeline specs.

In Oklahoma, 70% of Enable's gas feedstock is rich, and 30% is lean. This mixture allows the company to reject large quantities of ethane and blend in lean gas to make pipeline-quality gas feedstock, McCandless said.