Economic Alliance Houston Port Region President and CEO Chad Burke has a very positive outlook on the economic health of the southeastern area of the United States — particularly in the Gulf Coast region.
“Our economy and the petrochemical industry is still thriving, growing and expanding right now,” he said. “The Economic Alliance is charged with growing the local economy, so we work with companies to try to convince them to put their projects in our region, whether it’s a green field project or an expansion project,” Burke said, addressing delegates at the Industrial Procurement Forum held recently in Pasadena, Texas.
“This year alone, the projects that we’ve worked on that have come to fruition are in excess of $470 million — almost a half a billion dollars in new project work in 2016,” Burke added. “It’s never, ever been a better time to be a service or contracting company in the petrochemical industry.”
Channel Terminals is just one industry example benefitting from this robust climate and is currently actively recruiting contractors to assist in the biofuel facility’s start-up.
“Moving forward, we’re looking for maintenance services for the plant, instrument controls and services, and so forth — anything that is services-related for a start-up,” said Dennis Frost, the company’s business manager.
Whether acquiring a workforce for a start-up or a long-term, well-established company, Jeffrey Labosco noted delivering maximum productivity is a significant challenge to successfully contracting for capital projects, turnaround-related services, and smaller asset management purchases.
“The challenge is not just having the bodies. It’s getting the ‘A-Team’ and the productivity that comes along with it,” said Labosco, director of LyondellBasell’s North America Technical services, materials and capital procurement. “We want the best safety, and we want the best quality. We want all of these things, plus we want the A-Team. It’s easy for us to execute a contract, but it’s difficult to ensure that we’re going to get the A-Team.
“If we get a 5-percent productivity improvement because we’ve got the A-Team, that dwarfs the 10 cents an hour you’ve got or the 2-percent reduction on the overhead.”
ExxonMobil’s Americas Regional Projects Procurement Advisor Jim Windham emphasized the importance of participating in a project’s planning and development stage.
“Identify those potential drags that you’re going to have, whether it be a turnaround or whatever it may be,” Windham recommended. “Procurement needs to establish a plan in the early development and get our contractors and their subcontractors engaged early. You’ve got to retain these guys — the craft labor — and get them on the books as soon as possible.”
Dixie Chemical Vice President of Procurement and Business Specialist Kelli Gregory observed lack of or poor communication often presents major obstacles in the successful execution of a project.
“The more information you can give us, the more we can be understanding and can work together to find a solution to the problems that we may have,” she said, adding good communication begins as early as the bidding process. “If you’re giving us oranges when we ask for apples, then we have to try to decipher it to try to come up with a good plan. So make sure you communicate what we’re actually asking for, and then communicate above and beyond once you’re in the project to make sure we understand what’s going on and if there are any hurdles that you are running across.”
