A modularisation approach – strategies to benefit projects

In an exclusive interview with ADIPEC News, Maurizio Coratella, Executive Vice President and Chief Operating Officer, McDermott discusses the benefits of modularisation approach.

McDermott is renowned for its industry-leading modular LNG strategy. What are the benefits of a modularisation approach?

The industry is seeing an increasing focus on implementing a modular execution strategy, primarily as this provides greater certainty on project delivery, both in cost and schedule. This reduces the uncertainties that are often outside the control of the EPC contractor, whether these are political, social, or climate influenced events.

There are many benefits to adopting a modularisation approach. One key driver is schedule. If a project is hampered by a lengthy permitting process, modularisation can effectively allow construction to begin months earlier in the fabrication facility. A further cost saving can be realised due to a reduced requirement for the field installation of equipment. With proper work scheduling and sequencing, this can allow for reduced on-site costs.

Another factor is labour costs. This is a benefit if the module fabrication facility labour costs are lower than field labour costs, especially when the infrastructure required to support crews in the field is considered. Modularisation also reduces the amount of direct and indirect field labour required. This can be an important factor in projects that are competing for resources with other projects or are limited in local resources. Cost savings can be realised through a reduction in size of temporary facilities, camps, transport of workers, food, water, housing, medical needs, and recreation facilities at the jobsite.

In terms of productivity, module fabrication facilities have a stable workforce, well proven standards, procedures and assembly-line techniques that add to the overall efficiency of the fabrication process.

The work is performed in a covered and/or environmentally controlled environment which eliminates the loss of productivity due to weather.

Safety is always our primary focus, and generally speaking, a controlled fabrication facility environment reduces the safety risks of a project.

How will AI transform gas and energy?

Artificial Intelligence (AI) is transforming the gas and energy sectors by enhancing operational efficiency, emissions management, and driving sustainability. AI plays a critical role in emissions monitoring, helping the industry address environmental concerns and comply with regulatory standards. In the LNG sector, AI optimises complex operations by analysing vast amounts of data from equipment monitoring, safety systems, and terminal processes. This enables predictive maintenance and process optimisation, improving efficiency and safety. By processing data more effectively, AI reduces human error and enhances decision-making, driving the industry's digital transformation.

On the contrary, the growth of AI caused the increase of data centres, which has consequently increased the demand for natural gas, as these centres require significant electrical power. This has positioned natural gas as a reliable energy source, with AI indirectly influencing market dynamics and boosting gas production.

In the EPC sector, AI algorithms can optimise energy use, material handling, scheduling, and project management, leading to increased efficiency and cost savings. Despite its potential, AI integration in the EPC sector has been limited due to challenges in demonstrating the business value of AI solutions and a lack of industrial experience, which often creates a mismatch between management expectations and realistic outcomes. Recently, the EPC industry has begun investing in AI for purposes like improving project management, enhancing design and planning processes, and facilitating better communication and collaboration.

McDermott has been at the forefront of integrating AI into its operations, focusing on transforming engineering, procurement, and construction workflows. We have developed in-house AI tools that automate key elements of our engineering process, creating co-pilot applications that streamline tasks, free-up time for higher-value activities, enhance quality, and reduce rework. These tools support core EPC workflows, ensuring consistency and accelerating the bidding process. We are also leveraging AI for experience capturing, which harnesses and elevates human expertise in executing EPC projects. This not only improves internal knowledge management but also demonstrates to clients how AI innovations enhance safety and quality in our project execution. Through these AI-driven efforts, we are positioning ourselves as a leader in adapting AI for large-scale industrial projects in the EPC sector.

What kind of innovations are we seeing regarding e-drives and other emerging technologies and what potential do they have to drive down costs?

One of the innovations we are seeing with e-drives is the development of an increasingly standard and modular design approach to the liquefaction and refrigeration units of an LNG facility. This should provide an opportunity to drive down cost and result in a reduced testing program and shorter delivery times.

In another area related to the operation of LNG liquefaction facilities, we are seeing increasing challenges with the range of feed gas compositions that need to be processed, specifically related to heavier hydrocarbon components present in the feed gas. This is the case even if they are only present at very low levels, such as parts per million.

Their presence has resulted in an increased downtime of many LNG facilities with a resultant drop in LNG production and loss of revenue. To overcome these challenges, we are seeing new and innovative gas treatment solutions and technologies being implemented on impacted LNG facilities. This approach offers a cost effective (and potentially lower CAPEX) solution for the treatment of the feed gas prior to liquefaction. Additionally, it ensures the availability and reliability of the facility is maintained at very high levels, thereby providing added confidence in meeting LNG supply contractual obligations.