Copyright © Saudi Aramco, 2006. All rights reserved. No portion of this presentation may be reproduced, by any process or technique, without the express written consent of Saudi Aramco

Session Chair:Ghaleb AL-Dandan, Project Manager

Saudi Aramco

Presenters:Bader AL-Hammadi, Senior Estimator Marwan AL-Nasser, Business Analyst

Minh Branton, Cost Analyst

Session TitleApplications Supporting Capital

Projects: SAP Project Management Information System (PMIS)

What We’ll Cover …

• Session Objective• SAP Implementation @ Saudi Aramco• Brief Project Background• Project Benefits• SAP PMIS Scope• Speakers Presentations & Demonstrations

Session Objective

• To share the experiences gained in developing ERP applications pertaining to Capital Projects within a dynamic and complex environment.

• To illustrate the usefulness of those applications in other similar organizations.

What We’ll Cover …

• Session Objective• SAP Implementation @ Saudi Aramco• Brief Project Background• Project Benefits• SAP PMIS Scope• System Demonstrations

SAP Implementation @ Saudi Aramco

Business InformationWarehouse

BW

ISIS Telecom, Healthcare, Aviation, Oil

Enterprise PortalEnterprise Portal

HRHuman Resources

Payroll & BenefitsPerformance Management

Core

e-Banking

AramcoSAP

Environment Health & Safety EH&S

Strategic EnterpriseManagement

SEM

Materials ManagementMM

SDSales & Distribution

TFM Transportation Service ProcurementSRV

PMIS

FI Finance & Reporting

PMPlant Maintenance

QMQuality Management

ESTEstimation

PS Projects System

What We’ll Cover …

• Workshop Objective• SAP Implementation @ Saudi Aramco• Brief Project Background• Project Benefits• SAP PMIS Scope• System Demonstrations

Brief Project Background

• The Expansion in Saudi Aramco Capital Program• Distributed nature of the Project Management Teams• The need to create innovative tools to better manage

and control the entire Project lifecycle

What We’ll Cover …

• Session Objective• SAP Implementation @ Saudi Aramco• Brief Project Background• Project Benefits• SAP PMIS Scope• System Demonstrations

Project Benefits

• Business process improvements and automation• Providing a Forecasting tool for PM Capital Projects

Components• Improve data collection, historization and reporting

capabilities for Project Management• Replacement of open shop systems with Saudi

Aramco corporate applications

What We’ll Cover …

• Session Objective• SAP Implementation @ Saudi Aramco• Brief Project Background• Project Benefits• SAP PMIS Scope• System Demonstrations

Project Scope

Capital ProjectPlanning

Conceptual DesignEstimates Prep.Schedule AnalysisCash Flow ApplicationBenchmarking

Construction

Expenditure PlanningCash flow expenditureValue Practices

Project Close OutAutomate SAEP-329Project Cost IndicesBenchmarkingArchiving

PMIS Basic Eng/ Funding/ Detailed Design

DBSP EstimatesProject ProposalSchedule DevelopmentExecution PlanningEstimate Accuracy

Project Scope

PMIS

Estimation

Mgt Reporting Cash Flow

Estimating

Project Close Out

Summary

Eng. & Est. Integration

Tools

CADA

Estimate Accuracy

Construction Statistics Engineering

Statistics

Project Performance

Indices

Expenditure Reporting

Benchmarking

BP Forecast

BP Analysis

Expenditure Forecast Reporting

CADA

Scheduling

Value Engineering

Project cost

indices Cash Flow

Project Material

Capital ProjectPlanning

Conceptual DesignEstimates Prep.Schedule AnalysisCash Flow ApplicationBenchmarking

Construction

Expenditure PlanningCash flow expenditureValue Practices

Project Close OutAutomate SAEP-329Project Cost IndicesBenchmarkingArchiving

Basic Eng/ Funding/ Detailed Design

DBSP EstimatesProject ProposalSchedule DevelopmentExecution PlanningEstimate Accuracy

Project Scope

Management Management ReportingReporting

Business PlanBusiness PlanForecastForecast

Business Plan Business Plan AnalysisAnalysis

EstimationEstimation

Project Management Information System

Expenditure Expenditure ForecastForecast

System Demonstrations

Marwan Nasser

Minh Branton

Bader Hammadi

Presenter

Business Analyst

Cost Analyst

Senior Estimator

Position

Capital Projects Analysis and Reporting

Expenditure Forecast

Estimating and Business Plan Forecast

System

Questions?

“With Information comes Knowledge and with Knowledge comes Improvements”

Bader M. ALBader M. AL--HammadiHammadi

STUDY (+/- 50%) BUDGET (+/- 40%) ER (+/- 10%) Definitive

Study & Development DBSP Preliminary Engineering Detailed Engineering On-Stream

Determine Feasibility of Project

Initial Return on Investment

Involve very preliminarily scope info.

Project becomes part of the Capital ProgramAccuracy +/-50%

Refinement of the Study Estimate

Based on the Design Basis Scoping Paper (DBSP)

Accuracy +/- 40%

Forms an integral part of the project proposal

Prepared using a detailed scope, material take-off and vendor quotations.

Accuracy +/-10%

Based on awarded contracts

Project Close Out

Based on Actual

Project Life Cycle - Phases & Estimates

SAP Estimation &

Business Plan Forecast

Benefits Gained …….

Utilized Online rather than hard copy

Benefits Gained

Eliminated many manual processes

Replaced Several Legacy Systems

Benefits Gained

Single Corporate System

Historized Data (Costs, Quantity, Mhrs)

Benefits Gained

Provided tool for strategic planning (Future Projects)

Benefits Gained

Made a significant improvement to the process

Benefits Gained

Estimate Request Approval

Lead Estimator

Assignment

Estimate Preparations

Estimate Approval

Estimate Upload

Timberline

Estimate Delivery

Estimate Initiation

Estimating Business Process in SAP

Task (s) Assignment

EstimateTracking

Estimate Request Approval

Lead Estimator

Assignment

Estimate Preparations

Estimate Approval

Estimate Upload

Timberline

Estimate Delivery

Estimate Initiation

Estimating Business Process in SAP.

Task (s) Assignment

EstimateTracking

SAP Business Plan Forecast

Business Plan Forecast

3.0

2.0

8.0

5.0

4.0

0

1

2

3

4

5

6

7

8

$ B

illio

n

2007 2008 2009 2010 20110

10

20

30

40

50

60

70

80

90

2007 2008 2009 2010 2011

Mill

ion

Man

hour

s

S. Aramco KSA Others Region

0102030405060708090

Concrete(M3)

Steel(MT)

Pipe(MT)

Pumps(Each)

20072008200920102011

Business Plan Forecast- Commodities & Services

Major Equipment

BP ForecastBP ForecastReportsReports

Construction Mhs

Major Commodities Engineering Mhs

Forecast Engine

EstimationData

5-Year BP

` `

`

`

`

`

`

` `

`

`

` `

Business Plan Forecast

050

100150200250300350400450

2006 2007 2008 2009 2010

Carbon Steel PipingCarbon Steel Piping

Met

ric T

onna

ge

(x 1

000)

Major Commodities ForecastMajor Commodities Forecast

0

5

10

15

20

25

30

35

2006 2007 2008 2009 2010

Structural SteelStructural Steel

Met

ric T

onna

ge

(x 1

000)

Year

` `

1.00

1.40

0.80

1.60

0.75

1.00

0.25

0.75

0.15

0.85

0.0

0.5

1.0

1.5

2.0

2.5

3.0

Man

hour

s (M

illio

n

'2006 '2007 '2008 '2009 '2010

In Kingdom

Out of Kingdom

Engineering Manhours Forecast

` `

Minh A. BrantonMinh A. Branton

Cash Flow System

Finance Projects System

Project Cash Flow Business Process

Cash Flow Reports Cash Flow Model Simulation

Historical Data Current Data

SAP

0 10 20 30 40 50 60 70 80 90 100

$ Ex

pend

iture

ERAERA

OSOS

ERA ERA –– OS DURATIONOS DURATIONPRIOR ERAPRIOR ERA POST OSPOST OS-- %%

8 mos.8 mos.

+ %+ %

6 mos.6 mos.22 mos.22 mos.

CASH FLOW EXPENDITURE DURATIONCASH FLOW EXPENDITURE DURATION36 mos.36 mos.

Project Cash Flow Model

• 1100 - New Process Facilities• 1200 - Onshore Maintain Potential• 1300 - Onshore Pipelines• 1400 - Communications• 1500 - Plant Improvements• 1600 - Civil/Infrastructure• 1700 - Site Development• 1800 - Offshore Facilities• 1900 - Power Generation and Distribution• 2000 - Distributed Control System

Project Types

1100 - New Process Facilities• 1101 - Crude Production Expansion• 1102 - Wet Crude Handling Facilities• 1103 - Gas Oil Separating Plants• 1104 - Water Injection System• 1105 - Gas Plant and Facilities• 1106 - Gas Gathering and Distribution• 1107 - Refinery Expansion• 1108 - Terminal/Marine Facilities• 1109 - On-Shore GOSPs

Project Sub-Types

Cash Flow ModelCash Flow Model

Project B Project B –– Gas PlantGas Plant

Project C Project C –– Gas PlantGas Plant

ERA FC

Historical Projects Historical Projects with Different Durationwith Different Duration

ERA FC

ERA FC

OS

OS

OS

Cash Flow Model

FCOSES ERA

Project A Project A –– Gas PlantGas Plant

ES

ES

ES

ES – Expenditure StartERA – Expenditure Request (Funding) Approval

OS – On StreamFC – Financial Close-out

Increment% of Expenditure

$0.1M$0.1M$0.5M$0.5M$2.0M$2.0M$3.0M$3.0M$7.0M$7.0M$8.0M$8.0M$9.0M$9.0M$9.0M$9.0M$5.0M$5.0M$3.0M$3.0M$1.5M$1.5M$0.5M$0.5M

12Q12Q11Q11Q10Q10Q9Q9Q8Q8Q7Q7Q6Q6Q5Q5Q4Q4Q3Q3Q2Q2Q1Q1Q

1010998877665544332211

Quarterly

Expenditure

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Project Cash Flow System Usage

• Front-End Planning • Historical Projects Benchmarking • Cash Flow Forecast Refinement

Project Cash Flow System Capabilities

• Real Time Extraction of Historical Database• Real Time Online Analysis to Check Information• Benchmark against Historical Projects• Produce Cash Flow Expenditure Duration • Develop Project Schedule Cash Flow • Produce Quarterly Expenditure Forecast• Produce a Large Variety of Reports• Allows the User to be an Analyst

New Cash Flow Model SimulationDATA INPUT FOR A NEW PROJECTDATA INPUT FOR A NEW PROJECT

PROJECT NUMBER: PROJECT TITLE:PROJECT TYPE & SUBTYPE:ESTIMATED ERA(FUNDING) APPROVED DATE:ESTIMATED ONSTREAM DATE:ESTIMATED COST: US$

RESULTS OUTPUTRESULTS OUTPUT

0 10 20 30 40 50 60 70 80 90 100

$ Ex

pend

iture

1010998877665544332211

ES ERA OS FC

$0.1M$0.1M$0.5M$0.5M$2M$2M$3M$3M$8M$8M$10M$10M$15M$15M$10M$10M$5M$5M$3M$3M$1.5M$1.5M$0.5M$0.5M

12Q12Q11Q11Q10Q10Q9Q9Q8Q8Q7Q7Q6Q6Q5Q5Q4Q4Q3Q3Q2Q2Q1Q1Q

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

% E

xpen

ded

Cash Flow Model ComparisonHISTORICAL PROJECTSHISTORICAL PROJECTS

OffshoreOffshore

OnshoreOnshore

TotalTotal

Offshore Facilities Onshore Facilities Total

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06 Q1/07 Q2/07 Q3/07 Q4/07 Q1/08 Q2/08$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

Ongoing Project Mode l 1 Mode l 2Ongoing Proj Cumula tive Mode l 1 Cumula tive Mode l 2 Cumula tive

BY

QTR

S ($

x 1

000)

CU

MU

LATI

VE (

$ x

1000

)

ERA

OS

Cash Flow Model Comparison

ONON--GOING PROJECTGOING PROJECT

NEW PROJECTNEW PROJECT

NEW PROJECTNEW PROJECT

ONON--GOING PROJECTGOING PROJECT

STUDY (+/- 50%) BUDGET (+/- 40%) ER (+/- 10%) Definitive

Study & Development DBSP Preliminary Engineering Detailed Engineering On-Stream

Determine Feasibility of Project

Initial Return on Investment

Involve very preliminarily scope info.

Project becomes part of the Capital ProgramAccuracy +/-50%

Refinement of the Study Estimate

Based on the Design Basis Scoping Paper (DBSP)

Accuracy +/- 40%

Forms an integral part of the project proposal

Prepared using a detailed scope, material take-off and vendor quotations.

Accuracy +/-10%

Based on awarded contracts

Project Close Out

Based on Actual

Project Life Cycle - Phases & Estimates

Marwan N. ALMarwan N. AL--NasserNasser

Capital Projects Analysis and Reporting – Solution Drivers

• Multi Billion Dollar Capital Program• Large and distributed PMT offices worldwide • Need for scalable reporting solution• Need for consistent and accurate reporting• Data analysis requirements

Questions?

“With Information comes Knowledge and with Knowledge comes Improvements”