Hostname: page-component-cd9895bd7-mkpzs Total loading time: 0 Render date: 2024-12-25T04:34:23.298Z Has data issue: false hasContentIssue false

Value Analysis: Capturing Total Cost of Ownership reduction opportunities in E&P projects

Published online by Cambridge University Press:  01 April 2016

E. van der Schans*
Affiliation:
Stork Engineers and Contractors B.V., Radarweg 60, NL 1043 NT Amsterdam
J.W.N. van Lijssel
Affiliation:
Stork Engineers and Contractors B.V., Radarweg 60, NL 1043 NT Amsterdam
P. van Steenderen
Affiliation:
Stork Engineers and Contractors B.V., Radarweg 60, NL 1043 NT Amsterdam
*
1Corresponding author; e-mail: [email protected]

Abstract

Core share and HTML view are not available for this content. However, as you have access to this content, a full PDF is available via the ‘Save PDF’ action button.

Value Analysis is a powerful tool to increase the value of a capital investment project and to capture cost saving opportunities. It is a method conceived during WorldWar II and frequently used on infrastructure projects, especially in the USA.

The Value Analysis process typically consists of a well prepared 3 to 5 day workshop with focus on generating ideas to improve the current engineering concept. Emphasis is on screening all proposals in order to identify the most promising ideas. The workshop results in a number of proposals to modify the existing engineering concept.

Stork Engineers & Contractors have used the Value Analysis method on several projects as well as in proposals for Engineering, Procurement and Construction (EPC) projects in the Exploration and Production (EP) industry.

Typical results of Value Analysis led to a decrease of Total Cost of Ownership by some 10 to 30%. A well facilitated Value Analysis workshop also leads to mutual trust and understanding between the parties involved.

A key element in a Value Analysis is (re)definition of the proposed functionality of a project. This is done through challenging the existing technical concept by increasing this functionality or by meeting this functionality at a lower cost.

Type
Conference papers
Copyright
Copyright © Stichting Netherlands Journal of Geosciences 2001

References

Miles, L.D., 1961. Techniques of Value Analysis and Engineering - McGraw-Hill Book Company New York.Google Scholar
Kaufman, J.J. et al., 1994. Evaluating brainstorming ideas: “The making or breaking of the VE Workshop”. Annual Proceedings Society of American Value Engineers Google Scholar
Palmer, A., 1996. A comparative analysis of value management systems in the UK, USA and Japan, CIB Beijing international conference.Google Scholar