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S&P Global Commodity Insights Creates Sustainable Value for the Oil Industry

S&P Global Commodity Insights Creates Sustainable Value for the Oil Industry

February 19, 2025

 

Since 1909, S&P Global Commodity Insights has provided an independent lens on the energy and commodities markets. Whether managing daily operations or planning for energy transition, their clients leverage their market insights, commodity prices & market data, and risk, software, AI, consulting, and energy transition solutions to make complex decisions.

Working together with AspenTech and AWS, S&P Global Commodity Insights developed a new solution that is helping clients transition their existing refinery cost curve and margin model into a fully optimized global refining linear programming (LP) model.

 

Breaking New Ground in a Complex Industry

Data is at the heart of process manufacturing and swift decision making is its lifeblood – especially critical in the rapidly changing landscape of the oil and refining industry. Unfortunately, traditional methods involving extensive data collection and analysis can be inefficient which makes it difficult to perform analytics on the data. Those analytical capabilities are critical to helping oil producers remain competitive.

To address this, S&P Global Commodity Insights built a Refinery Cost & Margin Analytics (RCMA) solution for its oil and refinery customers and traders that is powered by Aspen Unified PIMS, an automated solution that enables expanded production planning and optimization capabilities to help clients understand the push and pull of supply chain, sourcing and demand. To bring the solution to more business users and analysts within client accounts, they brought in another long-time partner, AWS, so they could deliver the solution on a cloud-based architecture. By doing this, the RCMA solution was able to meet the higher compute performance needs required for running more robust scenarios that encompassed more data sets.

The partnership between S&P Global Commodity Insights, AspenTech and AWS has transformed the capabilities of RCMA into a cutting-edge solution. In addition to enabling the core RCMA data with Aspen Unified PIMS, a new service has been developed called Refining Scenario Manager. This provides an intuitive cloud-based interface that analyzes complex, user-defined scenarios of crude turnarounds, marginal value, refinery and downstream product breakeven pricing and more. With the high-performance computing powered by AWS, the architecture is currently running 40,000 scenarios and, according to David Daines, Global Alliance Manager at AWS, the system is poised to soon run 80,000 scenarios with more than 10X improved time to solve.

The RCMA modeling capabilities are agnostic, potentially suitable for any refinery and provide a broad range of advantages that enable clients to:

  • Change capacities, utilizations and models of operations for any global refinery
  • Perform turnaround analysis by turning off various process units and/or refineries
  • Analyze capital projects by evaluating margin analysis across process units
  • Model and understand impacts to refinery yields in a range of scenarios
  • Select any crude and grade from the crude library
  • Input user-specific crude prices, product prices, and transportation costs

 

“Moving from a desktop system to a cloud-based model opens up all kinds of possibilities for our customers. It allows many more cases to be run. What used to take a week, no takes 30 hours – it’s just a huge step forward and enables our customers and analysts to be so much more strategic in their roles, rather than just crunching numbers all day.” - Andy Winter, Senior Director of Development, S&P Global Commodity Insights

 

Maintaining Regulatory Compliance

In addition to wringing the most out of operations and assets, the Refinery Solution Manager solution also helps clients achieve compliance with changing regulatory requirements. For example, the International Sustainability Standards Board requires companies now to do resilience studies on their businesses and on their assets. As refineries seek to understand the impact of carbon prices, emission reduction initiatives and other changes that will affect their margins and compliance long-term, the methodology in RCMA enables strategy teams to do a broad range of long-term analysis using customized scenarios through the model to generate different types of outputs.

 

Lowering Barriers to Entry

Modelling and analytics in this field have typically been carried out by highly skilled workers who were often siloed into refineries and niche markets. The team at S&P Global Commodity Insights wanted to change that dynamic by making ease of use a key goal for solution development. Instead of requiring process engineers with 15 to 20 years of experience to leverage RCMA or the Refinery Solution Manager, the easy-to-use interfaces provides less experienced users with sets of common, automated scenarios through drop-down menus that help drive complex choices faster.

 

“Instead of a chemical engineer at a major oil company with 20 years of experience using this solution, we are seeing a manager in the trading arm of an energy company, or a risk analyst at a bank using this solution.” - Henry Potter, Principal Solution Consultant, AspenTech

 

Simpler modelling capabilities also open doors to oil traders, investment banks and other companies that can take advantage of a rigorous refining market analysis tool. Financial institutions or insurance companies that used to hire third-party contractors to analyze the assets used to finance or ensure refineries can now do it themselves.

 

Conclusion

By spearheading the new RCMA solution, S&P Global Commodity Insights has helped to democratize both global refinery benchmarking and LP modelling technology. The optimization approach to refining market analysis is now available to larger professional circles, enabling improved business analysis and decision making in the refining market. Over the 20 to 30 months of development to testing to launch, the importance of the collaboration between S&P Global Commodity Insights, AspenTech and AWS was key to the success of the project.

 

For More Information

Assad Khan of S&P Global and Henry Potter of AspenTech discuss their collaborative efforts with Jordan Blum, Editorial Director at Hart Energy, during the AWS Energy Symposium 2024.

 

Read the case study: “S&P Global Commodity Insights Creates Sustainable Value for the Oil Industry with AspenTech and AWS

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