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Application of Lean Six Sigma in Oilfield Operations R.S. Buell; R.S. Buell ChevronTexaco Search for other works by this author on: This Site Google Scholar S.P. Turnipseed S.P. Turnipseed ChevronTexaco Search for other works by this author on: This Site Google Scholar Paper presented at the SPE Annual Technical Conference and Exhibition, Denver, Colorado, October 2003. Paper Number: SPE-84434-MS https://doi.org/10.2118/84434-MS Published: October 05 2003 Cite View This Citation Add to Citation Manager Share Icon Share Twitter LinkedIn Get Permissions Search Site Citation Buell, R.S., and S.P. Turnipseed. "Application of Lean Six Sigma in Oilfield Operations." Paper presented at the SPE Annual Technical Conference and Exhibition, Denver, Colorado, October 2003. doi: https://doi.org/10.2118/84434-MS Download citation file: Ris (Zotero) Reference Manager EasyBib Bookends Mendeley Papers EndNote RefWorks BibTex Search Dropdown Menu nav search search input Search input auto suggest search filter All ContentAll ProceedingsSociety of Petroleum Engineers (SPE)SPE Annual Technical Conference and Exhibition Search Advanced Search SummaryThis paper summarizes the experiences and results that improve business performance using Lean Six Sigma in North American and Asian upstream oil and gas operations. The background and history on Lean, Six Sigma, and Intl. Standardization Organization (ISO) systems are also provided. The role ISO-quality systems can play in supporting Lean and Six Sigma is explained and demonstrated with examples. The overviews of completed Lean Six Sigma projects are provided for well testing, rod-pump repair, water treatment, oil treatment, well stimulation, and production logging.IntroductionMost oil and gas producers, as well as oilfield-service and equipment providers, have used or been exposed to quality and statistical concepts through various initiatives in their respective organizations. The objective of these programs is to consistently bring together quality and statistical thinking combined with engineering principles to generate improved business results. A partial list of programs many oilfield companies have used includes the following:Statistical process control (SPC).1Total quality management, or total quality control, as defined by Ishikawa.2Baldridge's seven quality criteria.3Deming's 14-point system.4Juran's quality trilogy.5While these programs were often believed to be beneficial, few programs were sustained within an organization over multiple years. The specific benefits of these quality and statistical initiatives have typically not been well understood, quantified, or documented in the oil field. Continuous improvement requires a sustained effort, which has been a significant challenge to the petroleum industry. Employees and management alike are often skeptical of the benefits of a long-term commitment to these programs because they have seen several of these quality systems come and go without clear, lasting impact.A recently developed quality-statistical system is Six Sigma. Six Sigma evolved out of the work of Deming, Ishikawa, Juran, and others. Six Sigma has been enhanced over past quality initiatives through the following:Strategic alignment directed by leadership.Structured project-execution process.Structured organizational deployment.Strong emphasis on business results and verification of financial benefits.Lean is another quality-improvement methodology, focused on optimizing the customer-value chain. Lean was developed in the automotive sector but has transitioned into a wide variety of industries. The most recent developments in quality improvements combine Lean and Six Sigma to create Lean Six Sigma.Continuous quality improvement is also facilitated in a structured framework, such as ISO 9001:20006 or API Q1.7 These frameworks can be used for controlling operating procedures, assessing the capability of quality systems, sustaining continuous improvement, and managing records and documents.These concepts - proven in other industries - are being adapted by several operators in the oil industry, while building on the existing petroleum industry's knowledge of quality and statistics. Case histories are provided for one large oil producer's organizational deployment using Lean Six Sigma and ISO 9001 concepts to create sustainable, continuous improvement in upstream operations.Six SigmaSix Sigma is a process-improvement methodology that focuses on delivering products at a lower cost, with improved quality and reduced cycle time. It can be summarized as a method for reducing process variation. Six Sigma was developed in high-tech manufacturing in the 1980s. In the last ten years, this methodology has spread to many industries, including aerospace, pharmaceuticals, heavy manufacturing, and transactional-service industries.8–11 Application of Six Sigma in the oil field has been limited, occurring only in the last couple of years.Six Sigma can be defined as10,11A measure of process capability (Cpk).A set of tools.A disciplined methodology.A vision.A philosophy.A strategy.Defined mathematically, a Six Sigma process will have a process-capability potential of 2.0, as given in Eq. 1; a process capability of 1.5, as defined in Eq. 2; and a defect rate of 3.4 per million opportunities, or a sigma level of six, as defined in Eq. 3.Equations 1–3A Six Sigma process, as shown in Fig. 1, has six standard deviations between the process mean and the specification limits for a centered process.A defect rate of 3.4 per million for a normal distribution corresponds to slevel of 4.5. Motorola, in their original definition of Six Sigma, assumed that a process could shift or drift 1.5 s without detection.12 Thus, there is 1.5 sigma drift margin built into the standard definition of Six Sigma. The relationship between slevel and overall yield can be seen in Table 1 for a single-step process. Overall yield is equal to one, less the defect rate. Keywords: objective, project management, iso 9001, specification limit, spe 84434, oil production, strategic planning and management, run life, deployment, continuous improvement Subjects: Strategic Planning and Management, Information Management and Systems, Project management This content is only available via PDF. 2003. Society of Petroleum Engineers You can access this article if you purchase or spend a download.
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