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Feature: Modularisation in capital project execution

by Guest on Nov 1, 2017


Ashok Kumar Suwalka, principal specialist,  Material Management, Fluor Daniel.
Ashok Kumar Suwalka, principal specialist, Material Management, Fluor Daniel.

During the last 30 years, modularisation concept has become very popular in capital project execution. Ashok Kumar Suwalka, Principal Specialist, Material Management, Fluor Daniel, explains the advantages of modularisation over the stick-built approach.

Modularisation is an effective way of getting partial construction done at offsite (sub-contractor or fabrication yards) instead of onsite construction. This method has the potential to contribute to a reduction in cost and schedule overruns, high safety and quality standards, and improvements in project performance.

Engineering, procurement and construction

Engineering, procurement and construction (EPC) are three major phases of a capital project execution (such as any chemical, petrochemical, or oil and gas refining project), and always one of these phases drives the other two.

Earlier, mostly the engineering phase drove the construction to remain simple and easy to analyse. This approach had lot of limitations. However, with time, these phases have evolved. Engineering is now equipped with advanced computational and analytical tools and techniques (for example, SP3D modelling), which provide lot of flexibility to construction and procurement activities.

With no major engineering challenges, construction and procurement (part of supply chain) have now taken the lead roles in projects. This has brought in innovative construction methodologies and procurement strategies to overcome various project constraints (for example, fixed cost lump sum project, shortened schedule, and safety and quality compliance).

Modularisation, a specialised construction method supported by extensive logistics and supply chain strategies, is in high demand nowadays, while onsite construction has several constraints and challenges.

Many projects are adopting modular construction philosophy to overcome the constraints and challenges listed in Figure 1. In Europe, US and the Middle East, several capital projects have been constructed on the modularisation concept. Few of these projects are listed in Figure 2.

Selecting module fabrication yard

Material management (part of the supply chain group) is responsible to qualify the best suitable module fabrication and assembly yards from low-cost countries. The supply chain group ensures the availability of sufficient shop capacity, shop accreditation, financial soundness, engineering abilities, inventory management systems, awareness of import and export rules, knowledge of local laws, logistic systems, and compliance with safety and quality standards. The most important step in the process is soliciting the most competitive price from the fabricator.

Optimum decision of modularisation in projects highly depends on early construction and procurement planning, and logistic strategies, which drive the engineering activities and help the EPC contractor achieve the desired business objectives. Modules can be small/large, truckable/barge or SPMT (self-propelled modular trailer) mounted, horizontal/vertical, and single level/multilevel. Constructability, mechanical equipment sizes and piping configurations are critical factors in the modularisation of projects.

Supply chain group plays a very important role in modular project execution. The important elements are: how it drives each phase in the modular projects; how it determines the extent of modularisation in projects; how it manages critical interfaces between various phases of the project; and how it engages the concept of parallel project execution.

Modularisation has the potential to contribute to reduction in schedule overruns. It improves project performance by giving schedule advantages.

Better quality, safety and working conditions

Modularisation also offers an opportunity for better quality, enhanced safety and improved working conditions. Covered and controlled fabrication shops provide environmental conditions, which enable more productivity. There will be fewer weather related issues.

Employee retention will be higher, thereby keeping highly trained craft workers longer. The fabrication shops allow for more standardisation of procedures, which will improve quality and increase repeatability.

The use of complex automated production equipment is only feasible at a permanent fabrication shop. This automated equipment goes a long way in ensuring high quality fabrication of equipment and piping systems.

Today, modularisation is a key construction strategy. It is an effective way to get partial construction done in places where there is abundant low-cost labour, and the modules can be assembled in a controlled environment, thus resulting in a good quality product at a lower cost. Modularisation has gained remarkable acceptance in large oil and gas, refining and petrochemical projects.


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