The demand for energy is taking gas and oil production into increasingly challenging environments—into ever-deeper waters, for instance, and into seas that freeze—into places such as the Sea of Okhotsk.

Sakhalin Island, which lies in the Sea of Okhotsk, north of Japan, is home to an energy consortium that is expanding operations in spite of the weather to reach wealth on the bottom. Temperatures may fall to -40°C, but there are oil and gas reserves to be tapped. It takes robust instruments to monitor the processes on production platforms that far north. You want to set them and have them do their job, and you want to visit them as little as possible in the cold.

Sakhalin Energy Investment Corp., a consortium of companies led by a unit of Royal Dutch Shell, has been extracting hydrocarbons since 1999 from Russia's first offshore production platform, which is in the sea northeast of the island. Operations are expanding significantly. The company is building two more platforms and plans to connect them to a processing plant being built on shore.

Topsides of the Lunskoye platform, under construction on Sakhalin Island. The control systems for the platform will use Rosemount temperature and pressure transmitters.

According to Ivan Chernyakhovskiy, a spokesman for Sakhalin Energy, one of the platforms under construction will develop a field known as Piltun-Astokhskoye, which contains mainly oil with associated gas. The other platform will develop a gas field called Lunskoye, which has associated condensates and an oil rim.

The concrete gravity bases of these two platforms were installed off Sakhalin last summer. The topsides of the gas platform will be installed this year, and of the oil platform next year.

AMEC of London has been contracted for engineering the control systems on the platforms, and because of the cold has specified Rosemount temperature and pressure transmitters from Emerson Process Management to monitor the processes onboard.

WorleyParsons, which is headquartered in Sydney, Australia, is responsible for the onshore processing plant.

Between the platform and the plant, Emerson Process Management has delivered about 1,000 Rosemount pressure transmitters and more than 600 temperature transmitters.

Many of the temperature transmitters are being supplied assembled with a thermowell designed by Shell. A thermowell is a metal covering that protects the probe.

According to Mike Thomas, principal instrument engineer at AMEC, the application needed sensors that not only can handle the extreme cold, but also have high accuracy and reliability, and a long mean time to failure. He added that the sensors can be calibrated on-site with a handheld device.

The Rosemount 3051 pressure transmitters ordered are rated accurate within 0.15 percent in environments with as much as a 28°C daily change in temperature, and have a drift rate of 0.125 percent over five years. The company claims the transmitter needs only one calibration in that time.

The Rosemount 644 temperature transmitters are accurate within 0.15°C with an ambient temperature effect of 0.003°C for each 1°C change in environmental temperature. Emerson says the device has a two-year stability of 0.15 percent or 0.15°C, whichever is greater.

Much of this instrumentation will use Foundation fieldbus communications, allowing control room access to the diagnostics and predictive maintenance capability available from the transmitters.

Sakhalin Energy has been producing from the first platform during the summer months, but winter around the 50th parallel has made it difficult to keep supplies flowing all year. Ice keeps the shuttle tankers from reaching the platform. So the company is building a pipeline to carry oil and gas 800 km from the new processing plant to the southern tip of the island, where there is less sea ice to impede tankers.

Chernyakhovskiy said Sakhalin Energy plans to start year-round oil production near the end of 2007, and expects to begin shipments of liquefied natural gas in 2008. According to the company's Web site, it will be Russia's first LNG project.

For decades, radio frequency identification has been a solution in search of a problem. Then, in June 2003, Wal-Mart Stores Inc. asked its 100 top suppliers to affix RFID tags to pallets and cases. Others soon followed with RFID programs of their own, including retailers Albertson's, Best Buy, and Target as well as the U.S. Department of Defense.

Now an independent study led by Bill Hardgrave, director of the RFID Research Center at the University of Arkansas Walton College of Business, shows that Wal-Mart's bet on RFID inventory management is paying off.

Preliminary results from the 29-week study in 12 RFID-enabled and 12 control stores showed that RFID tagging reduced out-of-stocks of 4,554 unique products by 26 percent. While both types of stores improved their performance over the study period, RFID stores reduced out-of-stocks 63 percent faster.

The finding is among the first to highlight the business case for RFID. Out-of-stocks occur when there is not enough inventory on a store's shelves to meet demand. Among U.S. retailers, this occurs about 8 percent of the time and results in lost sales. RFID gives retailers a way to recapture those sales dollars.

Wal-Mart did more than just install RFID readers to scan cartons. Instead, it revised its work process for manag-
ing inventory. Rather than send employees through the aisles to inspect shelves visually, it used RFID to automate the entire process.

The RFID system scans pallets when they arrive in the back of the store and counts each case as workers move it out of storage to stock shelves. When cashiers scan a product's bar code, software then subtracts it from the case total. When the number of purchases approaches the number of items placed on the shelf, the system automatically generates a pick order for replenishment.

Although RFID-tagged items represented about 10 percent of total store merchandise, they accounted for 25 to 30 percent of pick lists at the start of the test. This suggests that the RFID system identified more out-of-stock items than associates did by walking the aisles. Over time, the number of RFID-enabled items on the pick list declined, indicating that the technology did a better job of keeping shelves stocked.

The study also highlighted other trends that it did not try to quantify. It found in-store inventory of RFID-tagged products declined, since associates did not order new product if they knew they had additional cases somewhere in the back room. Also, because associates spent less time creating manual pick lists, they had more time to spend with customers or to perform other tasks.

Wal-Mart has asked its 200 next largest suppliers to begin tagging pallets and cases this year. The study suggests that when it comes to managing inventory—whether in a store, a distribution center, or a military depot—RFID definitely appears to offer clear advantages.

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© 2006 by The American Society of Mechanical Engineers