Metso doubles spare parts coverage while halving capital stock operation expenditure

Metso’s Device Management business solution proves a true success at Norilsk Nickel refining plant in Finland.

In 2009, Norilsk Nickel Harjavalta and their maintenance provider ABB Service deepened their cooperation and teamwork with Metso by signing a Device Management business solution which transferred the storage, maintenance and assembly of valves and accessories at Norilsk Nickel Harjavalta to Metso.

The service agreement was a part of Norilsk Nickel maintenance improvement program. And improvements are indeed remarkable: Device coverage or spares availability for the installed base has increased from the initial 40% to 90% while achieving a 60% reduction in inventory value. Device harmonization and Metso’s optimized selection of spare parts is now reaping excellent rewards with 50% savings in capital cost and stock operation costs.

Moreover, during the continuing agreement better device coverage together with the streamlined ordering and delivery process has eliminated unplanned downtime and enabled a continuous improvement of process performance with minimized risk of production or quality losses.

Outsourcing warehousing operations is always an emotional change, but the expertise brought along by Metso has made it much easier.  Petteri Särkiniemi, a service engineer in ABB’s team, has been pleased with the expertise brought along by Metso and also surprised by how easy it was to make the change.

Reliability and system control have improved. There are fewer problems, and even fewer doubters. Valve management is all about response time. When the service is running as it should, a remote warehouse is actually closer than the warehouse that used to be next door.

Harmonization is at the core of Device Management Business Solutions

The agreement was preceded by an Installed Base Audit that covered the plant’s installed valve base. This ensured that valve types and codes were correctly listed in the plant’s maintenance system. Of the 1,600 valves installed, roughly half were Metso Neles valves and the remainder from other manufacturers.

Older production facilities typically have equipment from a wide array of manufacturers, and plenty was expected from the harmonization effort that is at the core of Device Management. At first, the harmonization focused on Metso valves and then over time concentrated on the whole valve base. As the harmonization process continued the more the benefits of the agreement become visible. Harmonization was based on what was most efficient for Norilsk Nickel with valves from Metso and third parties covered by the service agreement.

Improved availability and lower costs right from the start

Over the first five months of the contract, the amount of money tied up in Norilsk’s inventory dropped by 37%, a reduction even faster than originally calculated. An Inventory Audit by Metso enabled better utilization of spare parts already on site and the removal of obsolete parts, with contractual stock held by Metso gradually increasing to ensure availability (Fig 1).

Figure 1. An considerable reduction in customer inventory as Metso guarantees spare part availability

Maximizing production availability

Maximizing production availability requires that critical spare parts are available when needed. Metso’s Device Management Business Solution is helping many customers like Norilsk Nickel Harjavalta to meet availability targets while reducing the onsite spare parts inventory. Initially a Criticality Analysis was conducted in conjunction with Norilsk Nickel Harjavalta and the valves are now divided into five criticality classes. Valves and accessories in the most critical classes are kept in stock as are valves that have a shorter operating life. Other valves and accessories are ordered on demand.

Higher production efficiency

With guaranteed availability and response times comes the guarantee that the spare part is designed for the task, certification will be maintained and that the life of the equipment will be maximized. For those maintaining their own spare parts inventory to meet availability targets, Metso’s Device Management solution can rationalize inventories by removing unnecessary spare parts and streamlining used products. Improving maintenance is a strategic choice. Better maintenance quality improves process reliability and therefore also production efficiency.

An encouraging experience

What makes the cooperation between Norilsk, ABB and Metso so successful?

Norilsk Nickel put the spotlight on maintenance quality and set clear objectives for its partners. ABB, in turn, put a long-term development plan on the table and had a strong vision of what can be improved. Metso was able to provide a ready concept with local experts to fulfill their vision.

Figure 2 shows the actual cost to Norilsk Nickel Harjavalta in red compared to an estimate of replacement costs without Metso’s Device Management solution. Overall volumes have increased due to expansion at the plant.

Figure 2. The benefits can be seen from the difference between actual cost of the agreement and replacement estimate for years 1 to 4 of conventional service.