Shale Oil Company Page 1 of 3

Internet Case Study for Chapter 3: Project Management

Shale Oil Company
Shale Oil Company’s Aston, Ohio, manufacturing complex comprises several operating units. These
units process the crude oil that is pumped through and transform it into a multitude of hydrocarbon
products. The units run 24 hours a day, 7 days a week, and must be shut down for maintenance on a
predetermined schedule. One such unit is Distillation Unit No. 5, or DU5. Studies have shown that DU5
can operate only 3 years without major equipment breakdowns, and excessive loss of efficiency.
Therefore, DU5 is shut down every 3 years for cleaning, inspection, and repairs.

DU5 is the only distillation unit for crude oil in the Aston complex, and its shutdown severely affects all
other operating units. Some of the production can be compensated for by Shale refineries in other
locations, but the rest must be processed and stored before the shutdown. Without proper planning, a
nationwide shortage of Shale gasoline could occur. The time of DU5’s shutdown is critical, and the
length of time the unit is down must be kept to a minimum to limit production loss. Shale uses PERT as
a planning and controlling tool to minimize shutdown time.

The first phase of a shutdown is to open and clean the equipment. Inspectors can then enter the unit and
examine the damage. Once damages are determined, the needed repairs can be carried out. Repair times
can vary considerably, depending on what damage the inspection reveals. Based on previous inspection
records, some repair work is known ahead of time. Thorough cleaning of the equipment is also known to
improve the unit’s operating efficiency. The table below lists the many maintenance activities and their
estimated completion times.

DISCUSSION QUESTIONS

1. Determine the expected shutdown time and the probability that the shutdown can be completed 1
week earlier.

2. What are the probabilities that Shale finishes the maintenance project 1, 2, 3, 4, 5, or 6 days earlier?

3. Shale Oil is considering increasing the budget to shorten the shutdown. How do you suggest the
company proceed?

Preventive Maintenance of DU5

Time Estimates (in Days)
Most
Optimistic Pessimistic
Activities Likely
1-2 Circulate wash water throughout unit 1 2 2.5

2-3 Install blinds 1.5 2 2.5

3-4 Open and clean vessels and columns 2 3 4

3-5 Open and clean heat exchangers; remove 1 2 3

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tube bundles

3-6 Open and clean furnaces 1 2 4

3-7 Open and clean mechanical equipment 2 2.5 3

3-8 Inspect instrumentation 2 4 5

4-9 Inspect vessels and columns 1 2 3

5- Inspect heat-exchanger shells 1 1.5 2

10

5- Inspect tube bundles 1 1.5 2

11

6- Inspect furnaces 2 2.5 3

12

6- Retube furnaces 15 20 30
17

7- Inspect mechanical equipment 1 1.5 2

13

7- Install new pump mechanical seals 3 5 8

18

8- Repair instrumentation 3 8 15
19

9- Repair vessels and columns 14 21 28

14

10- Repair heat-exchanger shells 1 5 10

16

11- Repair tube bundles; retube 2 5 10

15

12- Repair furnaces 5 10 20

17

13- Repair mechanical equipment 10 15 25

18

14- Test and close vessels and columns 4 5 8

20

15- Install tube bundles into heat-exchanger 1 2 3

16 shells

16- Test and close heat exchangers 1 2 2.5

20

17- Test and close furnaces 1 2 3

20

18- Test and close mechanical equipment 1 2 3

20

19- Test instrumentation 2 4 6

20

20- Pull blinds 1.5 2 2.5

21

21- Purge all equipment with steam 1 3 5

22

22- Start up unit 3 5 10

23

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