Creating a Chemical Community: How Data Changes Everything

Process manufacturers, like chemical producers, are one of the top three segments for IIoT technology and investments are expected to grow by 10.9% per year through 2023, according to IDC. Some oil refiners such as MOL, meanwhile, are laying plans to expand their efforts in specialty chemicals. Stephen Reynolds, OSIsoft Industry Principal for Chemicals, is no stranger to the space. With a degree in chemical engineering and 20 years of experience in roles ranging from unit engineer to operations manager, he's seen the industry evolve first-hand.

What does the chemicals space look like?

“Chemistry makes the world go 'round, it's everywhere,” says Reynolds. The chemicals industry segments into commodity chemicals, specialty chemicals, agrichemicals, pharmaceutical chemicals, and consumer goods.  From a chemistry perspective, refineries are really just large chemical plants focused on a singular feedstock (crude oil), and the downstream petrochemical plants provide outlets for refinery products other than gasoline, helping them diversify revenue streams during downturns. Downstream commodity chemicals are high volume, but fairly low margin. Pharmaceutical plants are highly specialized, highly scrutinized and tightly regulated, but have much higher margins. Many specialty chemical companies come under similar scrutiny due to the manufacture of pharmaceutical precursors as well. As a whole, the industry can be very 'gray' at the boundaries, as many of these segments exist to serve other industries and are often lumped into those buckets. Ultimately, the different segments vary by scale, material, revenue, and process.

What are some of the big challenges facing the chemicals industry right now?

Much like other industries, compliance concerns and environmental regulations are a huge challenge, especially in the EU where policies are getting tighter and tighter. Firms must constantly monitor their operations so that they can prove compliance at any given time. Energy sustainability is also a major concern, and firms must innovate to minimize their environmental footprint while staying competitive.  Energy, material, and maintenance costs are all critical drivers.  Lastly, industry personnel are changing. Operations teams are aging and retiring, while the incoming workforce is more transient than in years past, often only staying in a position for 3-5 years. This makes knowledge transfer and retention a critical challenge facing the industry.

How can some of these problems be solved through digital technologies?

Digital technologies can be extremely helpful in addressing some of these challenges, but its all about using the right tools for the right job and layering those tools effectively. To make the most out of digital technologies, operational information must be available to the right place and people at the right time.  There are tools that can help build out situational awareness (like the PI System). With the right infrastructure, these tools can then be integrated outward for larger analysis pieces, to look for patterns, and to look for larger opportunities.

What's the primary driver for digital in the industry?

“A lot of it is buzz,” says Reynolds. CIO's see their peers doing innovative things with technology and they feel that they need to do it as well. Aside from that, the primary driver varies from company to company. For some, it can be cost, while for others, their main concerns are regulatory related. Ultimately, it's all about creating and maintaining competitive advantage and staying ahead of your peers. Agility is key.

What's the bigger challenge, technology or culture?

The chemical industry is generally slow to change, and the issue is a mix of technology and culture. There tends to be an “If it aint broke, don't fix it” attitude - essentially, tools are already in place that allow everyone to do their job sufficiently, so many may not recognize a need for change.

What changes do you expect to see by 2025?

By 2025, Reynolds predicts that there will be another realignment of businesses, particularly in how business entities interact with each other, with suppliers, and with customers. Through an increased use of technology, he predicts that a community model will take hold through increased information sharing.

“We may not share all information, but hopefully we share the right information.”

This could lead to more firms that have historically operated in other spaces learning from and moving into the chemicals space, such as MOL, an oil refiner with plans to move into specialty chemicals.

He also predicts that given the shift of the personnel landscape, there will be fewer, differently educated people involved as technology continues to improve. While people will still need to be hands-on in the actual facilities, the way plants are run and the way facilities are optimized will change.

What is the value of the PI System to the chemicals and petrochemicals industry?

Reynolds explains that the value of PI isn't just measured in dollars, it's measured in the actual improvement of situational awareness and hazard recognition/avoidance, softening the ups and downs that naturally occur in plants. Then, as the quality of day to day operations improves, the actual product improves.

The PI System is also invaluable to the industry because it allows companies to utilize their data to tackle both company-wide and industry-wide problems.

“The value of data is immeasurable. We use data to solve problems big and small every day.”

Firms like BASF SE have used the PI System to create a Reliability Center for remote condition monitoring, with the overall goal of optimizing plant availability and predicting chemical production plant failures around the globe. Covestro is layering analytics to enhance production and process optimization through ProDAVIS (Process Data Analysis and Visualization Initiative). Lubrizol is reducing process variability in semi-automatic and manual reactions, shifting process monitoring to a multivariate approach. This has led to a reduction of process variability and cycle time, increased availability of skilled operators, and a faster scale-up process.

OSIsoft is proud to be a trusted partner of leading chemical and petrochemical organizations, helping them transform their businesses one data point at a time.