Tales from the front line: Four lessons learned from a former NGL scheduler

They are on the front lines of daily logistics—the unsung heroes behind the scenes in the energy supply chain who get in early, stay late and typically work odd hours. These workers schedule and coordinate daily and monthly product movements on assigned transportation modes, coordinate crisis management, monitor assigned natural gas liquid (NGL) inventories, and review receipts, deliveries and exchange balances. This is a typical day in the life of an NGL scheduler.

As new pipelines get built to transport products from shale basins and trucks, rails, ships and barges become increasingly necessary to transport crude oil, petrochemicals and refined products to market, it is important to revisit the basics of how NGLs move and the role these schedulers play.

A unique perspective on the top concerns of NGL schedulers is presented here, including what keeps them up at night and the best responses to unforeseen disruptions in the supply chain.

Inventory. This is a simple enough concept. Is there enough product to fulfill demand? However, given the constant fluidity of any supply chain, the author was tasked with:

• Ensuring a fractionator’s production is fully utilized
• Ensuring enough feedstock to run units at max rates
• Monitoring trader sales commitment vs. the volume on hand (especially true at the beginning of the month)
• Ensuring adequate inventory for demand.

Pipeline logistics. Depending on the mode of transportation, there are numerous areas of concern and complexities to contend with daily:

• Keeping up with the schedule for pipeline batches (taking advantage of allocation and maximizing it to maintain a high capacity and get the product to customers)
• Unplanned pipeline outages, which require a Plan B or C to get supply out of fractionators and to customers
• Ensuring planned outages finish maintenance on time, enabling batches to flow on a timely basis.

Rail logistics. The complexities of railcar scheduling include:

• Are the railway switches on time? This is a potential problem if they are early because the cars will not be ready to be moved. If they are late, this can cause a backup at the rack and disrupt inventory plans.
• Are the railcars sitting too long, and must the company pay demurrage?
• If someone makes a claim, could it be refuted?
• Is there enough space in the railyard to spot cars and build trains to move them?
• Are there delays with the railroad, resulting in issues with loading out railcars?

Barge logistics. Weather, limiting demurrage costs and ensuring the product was on-spec are primary concerns. Other consideration include:

• What is the weather forecast? Severe weather (e.g., hurricanes, fog, heavy winds) causes delays. Delays cause issues when moving products.
• How long does it take to load a barge? Even though the math and experience provide an estimated timeframe to load a barge, loading schedules and shifts are uncontrollable. Therefore, if a crew is delayed, barge delivery will be delayed.
• What is the product spec, and what is the spec of the previous product? There is always a fine line between understanding what was previously transported and what is now being loaded to ensure the product does not go off-spec. This is a huge concern—an off-spec product cannot be delivered to customers.

As an NGL scheduler, the author is constantly worried about timing and customer service. It sounds easy until the reality of multiple modes of transportation and the unpredictability of the supply chain are considered. It is during these times that the author must solve problems quickly and be creative about finding solutions that are beneficial to the organization and customers.

The author’s company implements systems to solve these problems. The greatest skill an NGL scheduler can have is visibility into inventory, logistics, supply and demand. They must be able to see options quickly, so supply chain problems can be solved efficiently. GP

 

PATRICK MARTIN is a Senior Consultant for Opportune LLP’s Process & Technology practice in Houston, Texas. Martin has more than 6 yr of midstream scheduling and operations experience within the NGL trading and commercial development groups, gained working for Enterprise Products Partners. During his time at Enterprise Products, he worked with and built strong customer relationships with many oil and gas companies, from supermajors like ExxonMobil, Chevron and Phillips 66 to trade shops such as Vitol and Trafigura. Martin’s operational skills include scheduling physical movements of NGLs via pipeline, trucks, railcars and barges while also handling the paper side of trades through well transfers and customer inventory account management. He worked extensively with RightAngle to ensure trades were properly recorded and scheduled and physical trade exposures were reconciled with the risk department daily. Martin graduated from Texas A&M University with a BBA degree in supply chain management.