The reduction of product quality giveaway presents an opportunity for value addition and improvement of the bottom line. Over the past several decades all departments within Refining and Marketing have been pursuing this mission, resulting in significant savings.
Although these reductions in giveaway have financial benefit, they also come with inherent risk – and that is production of off-spec products, potentially resulting in costly shipping delays, and more importantly in damage to Bapco’s image and reputation as a reliable supplier of high quality products on the international market. Three years ago, as part of the Productivity Improvement Project, the study team recommended that the target flash point of kerosene be reduced by 0.5 degrees from 39.5°C to 39.0°C, potentially resulting in an annual savings of about $ 2 million. A multi-disciplinary team comprised of members from OPD, PC&I, ROP and TSD, and assisted by Marketing was formed to tackle this issue.
Given the variability in flash point testing, the team instituted a Management of Change where all aspects of the issues were thoroughly discussed, analyzed and implemented. This week, we are celebrating two years since the implementation of the initiative, and are pleased to announce that it has resulted in a resounding success. Over the past 2 years, we have reduced the giveaway and saved about $5 million in the process. This success could not have been achieved without the dedication and hard work and support by all stakeholders on the Bapco team. This is also a testimonial to the fact that Bapco has the skilled personnel and processes in place to find solutions to problems that previously seemed to be hard to achieve or even unattainable. The CE congratulated the whole team on persevering with the initiative, moving it to completion and putting in place a system which will maintain and continue to capture the financial reward for the foreseeable future. “This is an indication of the scale of achievement possible when people work as a team towards a common goal”, he said.