Taps Strategic Reconfiguration Project

Homework 1:

TAPS Strategic Reconfiguration Project

Project Overview Statement

Project Overview Statement

1. Problem Addressed by the Project

The problem of the pipeline was that there was a limit on the amount of oil that could flow through the pipeline due to decommissioned pumps. Since new oil fields were opening on the North Slope, current pipeline was not able to operate at a higher capacity. The Pipeline Reconfiguration Project looked to solve the problem of the limitation of oil flow that the pipeline could handle.

2. Project Goals and Objectives

Goal: To simplify the system to reduce overall operating costs by 10 percent annually ($50 million) and to operate more efficiently to extend the life of the pipeline while enhancing high safety, operational integrity and environmental standards that will be phased over the two-to three-year life of the project with the investment of $250 million.

Objectives: 1) Replace the gas turbine pumps with modern electric pumps

2) Install power to the pumps

3) Install the central pipeline control center in Anchorage

4) Establish communications between the pumps and the Anchorage control center

3. Success Measurements

1. Pipeline is able to operate at a rate of 1.1 million barrels per day which would be enough to handle the influx of oil

4. The project is able to reduce overall operating costs by 10%, equaling $50 million in savings per year

5. The project is able to extend the life of the pipeline by at least 20 years

6. Communication between operational control center and pumping stations is operational at least 99.9% of the time

7. The project is completed within budget (two years, $250 million) planned for the upgrade

3. No safety or environmental standards are interfered with while upgrading the pipeline

4. Assumptions for the Project

1. The investment of $250 million will be enough to make the necessary upgrades to the pipeline

2. The...