Modular Construction Oil and Gas

March 6, 2024
Safety & Quality
Procurement
Detail Engineering & Design

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Modular construction in the oil and gas industry involves building significant parts of a construction project in a controlled environment before transporting them onsite for assembly. This method has several advantages over traditional onsite construction, including the potential for improved quality control, shorter construction times, lower labor costs, increased safety, and a smaller environmental footprint.

Due to these benefits, the oil and gas industry increasingly chooses modular skid-mounted construction over traditional options. In this article, we will explore modular construction in this sector, discussing its methodologies, how it works, and its challenges, and provide real-life examples to offer deeper insight into this innovative development in construction management.

To skip around the Modular Construction Oil and Gas blog, use our index:

Methods

Modular construction in the oil and gas industry involves the detailed engineering, fabrication and assembly of various modules in a controlled environment, such as piping and control systems. These modules are subsequently transported to the project site for final installation and integration.

The success of this method hinges on meticulous front-end planning, requiring a thorough alignment of project specifications, design standards, and logistical considerations. The overarching goal of this approach is to streamline project execution completely. 

Best Practices for Successful Modular Construction

Front-End Planning

  • Early Team Formation: Assemble a multidisciplinary team from the outset, including representatives from operations, construction, purchasing, transportation, and vendors. Consider employing the EPC approach.
  • Boundary Conditions: Establish clear transportation and scope limits early in the project.
  • Design Finalization: Secure early internal agreement on final designs to prevent changes during execution.
  • Yard Layout Confirmation: Confirm the layouts of fabrication yards early to streamline subsequent processes.

Engineering

  • Boundary Definition and Repeatability: Clearly define boundary conditions and focus on repeatable designs and standard materials for efficiency.
  • Fabricator Involvement in Design: Involve fabricators in designing secondary and tertiary steel components where needed to ensure practical and feasible module designs.

Contracts & Procurement

  • Vendor Integration in the Design Phase: Integrate module fabricators early in the design process, leveraging their expertise in the feasibility and practical aspects of module fabrication.

The success of modular construction hinges on taking a strategic approach to logistics, which balances transportation challenges with environmental and safety concerns. This requires careful route planning and navigating a maze of regulations and potential obstacles. A comprehensive approach is required to ensure modules arrive at their destination on time, safely, and without issue.

How It Works

Modular oil and gas industry construction has both a strategic and tactical phase. The initial strategic phase requires scope analysis and evaluation of the overall constructability of the project. This involves an analysis of project parameters, including site conditions, existing structures, and technical requirements, and establishes all tasks that need to be performed before construction can begin.

It’s important to note that the early development of a strong scope definition is crucial for the success of any capital project. A well-defined scope reduces the likelihood of significant changes to the scope and the need for change orders during project execution.

Following the initial strategic phase, a tactical phase will review things like cost-benefit analysis, schedule optimization, and resource planning. This phase depends on combining technical knowledge and project management skills to ensure that modular construction aligns with the project's overall goals.

Modular construction in the oil and gas industry involves several well-defined steps listed below for further consideration.

Modular Construction Oil and Gas:
How It Works

Front-End Planning

Analyze labor costs, productivity, supply, technical feasibility, and logistics to determine project feasibility for modularization.

Detailed Design and Engineering

Detailed designs for modular construction that define module boundaries while ensuring precision for smooth fabrication, transportation, and installation.

Fabrication

Fabricate modules in controlled environments, focusing on quality control and assembly of components.

Transportation and Logistics

Plan and execute transportation of prefabricated modules, considering size, weight, and logistical challenges.

On-site Assembly

Assemble and integrate modules into existing infrastructure on-site, which requires careful coordination to ensure project alignment.

Project Management

A comprehensive execution strategy that includes early vendor involvement, strategic procurement, and aligning construction and fabrication timelines.

Challenges

Modular building in any industry poses a variety of challenges. Transporting large modules to remote or hard-to-reach areas sometimes presents logistical obstacles. Further, integration issues can occur when incorporating modular components with existing infrastructure and systems. Strategies for overcoming these common challenges require meticulous front-end planning, clear communication among all stakeholders, and design flexibility to accommodate any potential on-site adjustments.

When To Choose Modular

The decision to implement modular construction in the oil and gas industry can significantly impact the success of a project. It’s not practical or universally applicable to every job but should be considered under specific circumstances. One example, referred to simply as “Project C,” was a $1.75 billion oil and gas project in Alberta, Canada, analyzed by the Construction Industry Institute, illustrating modular construction's challenges and advantages. 

Key Considerations:

  • Remote Job Sites: Modular construction should be considered for projects in remote locations. Moving construction to a fabrication site can help overcome logistical and operational challenges in remote locations. 
  • Controlled Fabrication: When precision and control over the construction process is required, moving construction to an offsite fabrication shop for increased project control and to ensure higher safety and quality standards can be advantageous. 
  • Labor Shortage: When skilled workers are scarce or expensive, modular construction can provide an alternative that enables the use of highly-skilled workers are more accessible and work more efficiently. 
  • Requirement for Minimial Onsite Labor: The modular approach could be the right choice if a project requires reducing onsite labor. 

For further reading, the research paper 'Industrial Modularization: How to Optimize; How to Maximize' provides further insight into the modular construction process. This research report and other industry resources highlight modular construction's applications, challenges, and strategic considerations.

H+M Industrial EPC: Modular Construction Oil and Gas

Leveraging modular construction in the oil and gas industry can result in significant efficiencies, improved safety and quality, and cost savings. H+M’s modular approach provides comprehensive and tailored modular construction solutions across the United States.  We have extensive experience providing solutions for a wide range of project sizes in the energy, chemical, terminals, and logistics industries.

H+M’s modular group is dedicated to providing trust, experience, and efficiency through all stages of engineering, procurement, and construction utilizing our proven strategic EPC approach. Our comprehensive services, including detail engineering and design, procurement, fabrication, and construction allow us to take your project from conception to completion, tailoring engineering and design solutions to meet your unique needs.

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To find out more about the advantages and disadvantages of turnkey projects and how H+M Industrial EPC can meet your capital project needs, contact us through our website today.

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For over three decades, we have provided best-in-class capital project management services to Energy and Chemical industries through our proven EPC approach. We are dedicated to providing trust, experience, and efficiency through all stages of engineering, procurement, and construction--on budget and on time.

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