1. Kathy Miller and Whitney Macormic, CITGO Petroleum Corporation
CITGO Refined Products Supply Chain Solution Combining R/3, IS-Oil, TSW and BW for an end-to-end solution
Introduction
Kathy Miller and Whitney Macormic, CITGO Petroleum Corporation

2. CITGO’s SAP “Evolution” Operating Supply Chain Solution
Agenda
Introduction
CITGO’s SAP “Evolution”
Operating Supply Chain Solution
The Solution with Supporting Details
Questions

3. 3 owned Light Product Refineries 2 owned Asphalt Refineries
About CITGO Petroleum
Wholly owned by PDVSA
Downstream Only
$17 Billion in Revenues
3 owned Light Product Refineries
2 owned Asphalt Refineries
3 Joint Venture Refineries
1,025 MB per day Refining Capacity
All Business Units on SAP
We wanted to share some hard facts about Citgo, so you can understand how we might compare to your organization.
Hopefully, you will get a better idea of some of our tremendous successes and challenges to be fully intergrated with SAP.

4. About CITGO’s Refined Product Group
~ 20,000,000 BBL System
50+ Equity Terminals
350 Exchange Locations
100+ Terminalling Locations
15+ Pipelines used
1800+ Marine moves per year
Our Refined Product group alone has many challenges on a daily basis.

5. About CITGO’s SAP System
4200 named users
~ 500 concurrent
Single Instance, 2.5 TB Database
4.6C Oil and Gas
All R/3 Modules except QM
All Business Units
Initial Implementation 1/98 – 11/99
Implmentations:
Asphalt and FI – January 1998
Light Oils – June 1999
Lubes – November 1999

6. “SAP” Core R/3 + IS-Oil (Jan ’98) Traders Schedulers Workbench
“SAP” Evolution: ‘98 – ‘02
“SAP”
Core R/3 +
IS-Oil
(Jan ’98)
Traders
Schedulers
Workbench
(Jun ’99)
Custom
Development
(Jan ’98-’02)
Business
Warehouse
(Aug ’01)
Key here is to clarify that we use the term SAP generically, but our solution is made up of several different products as well as a lot of custom development (mainly for automation.)
(Each square has a hot link to the details of each.)

7. Business Unit Reporting (’99) Profitability Analysis (’99)
Core R/3
Financials (’98)
Asphalt Logistics (’98)
Business Unit Reporting (’99)
Profitability Analysis (’99)
Full Exchange Processing (’99)
Terminalling Agreement Processing (’99)
Processing Agreements for Petrochemicals (’99)

8. Nominations Actualization Rundowns Transportation Pipeline Marine
TSW
Nominations
Pipeline
Marine
Actualization
Includes Distribution Cost Calculations
Rundowns
Terminal/Prod Level Inventory Projections
Transportation
Marine Cost Tracking
Dock Scheduling

9. Interfaces to 3rd Party Software
Custom Development
Interfaces to 3rd Party Software
Terminal Automation
Petroex
Transportation Companies (Pipelines, Truck Freight, Marine Companies, etc.)
Demand Planning
Enhancing SAP programs
Several TSW modifications…much better in 4.6C
Functionality extensions in several areas
Custom reporting
Transportation costs
Exchanges
Business Unit Reporting

10. Total System Physical Inventory ProjectionBW
Total System Physical Inventory Projection
Gasoline, Distillates, Turbine
Region-level projection
“Priced” Inventory Projection

11. A Blast from Our Past…

12. Rundown with scheduled delivery Scheduler’s “playground”
The TSW World
Pipeline Nomination
Rundown with scheduled delivery
Scheduler’s “playground”
Immediate updates to rundown
Inventory graph from rundown
Marine Nomination
Event Log
Scheduling and RVP
Planning tool for destination schedulers.
Allows “What If” scenarios w/o disturbing current noms or PO’s and SO’s.
Allows these scenarios w/o regeneration of rd.
Can graph directly from rd to compare to target inventories.
RVP BOM allows us to view all data on one product code.
Schedulers, marine folks are required to enter much data.

13. TSW Nomination
Schedule a barrell delivery into Meridian on June 18th - stock transfer (plant-to-plant).

14. TSW Nomination on Rundown
Quick overview of layout of rundown – daily, SAP book and physical inventory, receipts vs. issues, right most column has truck activity.
Rundown shows the receipt and the effect on the inventory projection.
Touch on the header numbers on rundown (book, physical, Alternate, Inventory limits).
ATAC feeds
Rundown now an ALV control in Service Pack 1. Look and feel of spreadsheet and real-time – should be very nice.

15. Scheduler’s “Playground”
Custom built transaction to allow very flexible, very easy replenishment planning. Enter in how you want to change the current scheduling and the rundown is automatically updated to reflect the new inventory position.
Nothing is actually changed in SAP (nomination, order, etc.) except for the rundown.
Nightly job ‘cleans up’ the playground so the users don’t have to worry about it.
In this example, the scheduler wants to determine what will happen if they can’t get the entire barrells as originally thought, now they may just receive in So, create a proposal for 5000 to take this out of their inventory projection on the rundown.

16. Scheduler’s “Playground”
Shows the ‘proposed’ schedule change as an issue on the rundown.
Notice that the nomination information is still the same. That is because nothing in TSW or SAP R/3 has actually changed yet, except the rundown.
The SAP Book inventory projection reflects the proposal.

17. Inventory Graph From Rundown
Inventory graph called from rundown or stand alone.
Graphs rundown numbers.
Difference in BOOK and physical s/b bottoms – check with Kathy?

18. Marine Nomination
Marine nominations not much different except for UOM and material at item level. Main difference is the event log – next screen.

19. Event Log Event type link to G/L accounts Configure however you’d like
Lots of reporting off of event log
Event log becoming more important as more of our Asphalt and Crude business uses TSW.
Currently working with several vendors on getting files from them with ‘event’/dock information so that we can automatically update the event log.
Drill down capability into SAP R/3 documents (i.e. freight purchase orders).
Free form text can be entered too.

20. Scheduling and RVP
Handling of RVP from scheduling/actualization perspective works very well.
Master data setup makes most if not all of the process happen automatically.
Date driven – so if schedule slips and/or for year to year RVP changeover.

21. And that’s TSW at CITGO…(the quick version)
We can honestly say that at CITGO:
his
tuff
orks

22. Business Warehouse Example
One of our biggest frustration at Citgo has been that we are required to enter so much data into SAP, but we can’t get the data out as we need it, and as it makes sense for Operations.
However, BW (Business Warehouse) has become that solution in extracting data from this monster data base.
We have successfully been able to pull out of SAP all of these data points that give Citgo our total system inventory current and projected.
Used for our Risk Mgmt purposes, inventory control, year-end inventory planning, etc.

23. AS OF MORNING OF LAST DAY OF MONTH Gasoline – Finished & Unfinished
Improvement in Process
Inventory Projection Improvement
AS OF MORNING OF LAST DAY OF MONTH
Gasoline – Finished & Unfinished
July MB January MB
August MB February MB
September 1024 MB March MB
October MB April MB
November MB
December MB
This number represents the barrels of last days inventory versus financial close.
Key: Keep data clean, up-to-date, valid, etc. so that the projection is more useable.
Along with being able to get our data out.
We now have a way to keep our data clean.
BW allows Citgo to find go deeper into the data quickly to keep our data cleaner.
This chart represents how we continue to improve on a monthly basis in keeping our data cleaner. This data is the barrel volume difference our projection was to our financial close.
We started using BW for this activity along with Mgmt requirements in October

24. AS OF MORNING OF LAST DAY OF MONTH
Improvement in Process
Inventory Projection Improvement
AS OF MORNING OF LAST DAY OF MONTH
Distillate
October 107 MB
November MB
December 802 MB
January 241 MB
February 227 MB
March 156 MB
April MB

25. AS OF MORNING OF LAST DAY OF MONTH
Improvement in Process
Inventory Projection Improvement
AS OF MORNING OF LAST DAY OF MONTH
Turbine
October 79 MB
November 117 MB
December 274 MB
January 145 MB
February 160 MB
March MB
April 515 MB

26. Supply and IT analysts always have the latest technology…

27. SAP Supply Chain Solution: ’98–‘02
Refineries
Refineries
Core R/3
TSW
Custom
Development
Demand Planning
Demand Planning
“CITGO” Terminals
CITGO” Terminals BW
Suppliers/Partners
Suppliers/Partners
Hot links to each area for details.
Information Brokers
Information Brokers

28. Production Yields (Actuals)
Refinery Interfaces
Production Forecasts
Daily data feed
30-60 days out
Reliability of information has been an issue
Production Yields (Actuals)
Weekends and holidays cause some “spiking” problems
We capture actuals and forecasts from all of these data points.

29. Demand Planning Interfaces
SAP to Demand Planning
Actual Liftings for historical trending
Demand Planning to SAP
Terminal/Material for TSW Rundowns
Customer/Material for Exchange reporting
Forecasts then fed to BW for Inventory Projection reporting

30. CITGO Terminal Interfaces
SAP to Terminals
Customer Master data
Allocations
Terminals to SAP
Rack Liftings
Physical Inventory Levels
Bulk Issues and Receipts
Gains/Losses

31. Pipeline Companies Other Suppliers Supplier Interfaces Tickets
Schedule Updates
“Schedule dates” for pricing
Other Suppliers
Invoices from Product Suppliers
Invoices from Trucking Companies
Logistical data to/from Marine Companies

32. Information Broker Interfaces
Petroex (Exchange liftings)
TMS (Exchange Allocations – manual)
Transport4 (Pipeline data)

33. For those of you heading to the beach this summer…

34. Commitment from IT & Business Change Management
Key Success Factors
Commitment from IT & Business
Change Management
Communication
Power-user Development
Training
Decision Making
Test, Test, Test
Timely and Accurate Data
“It ain’t over ‘till it’s over”
Commitment from IT & Business
Availability of key IT & BU personnel, Realize the running the business must come first, BU driving the design work, IT driving the development, This is going to be difficult!
Change Management
Communication
Communicate Early & Often
Reduces chance of miscommunication
Reduces stress associate with uncertainty
When people feel involved, they take ownership
Power-user Development
Builds system expertise in BU for future enhancement work
Speeds transition period after go-live
Reduces dependency on Tulsa IT
Training
Training development
On-line help development
Training delivery
Decision Making?
Business must own, Clear decision-making process, Advantage over Products because of size, Impacts to system, processes, and people
Test, Test, Test
Must have user involvement, Close to parallel as possible, Reduces the risk of business interruption, Reduces post go-live heartburn
Data
More data required, Automated feeds provides better results, Establishes the foundation for optimization
It ain’t over till it’s over
Incremental approach, Project doesn’t end at go-live!, this will be HARD, not plug and play, There will be startup issues, Post go-live optimization

35. “We changed SAP from being a barrier to a tool”.
Famous Quote at CITGO…
“We changed SAP from being a barrier to a tool”.
Commitment from IT & Business
Availability of key IT & BU personnel, Realize the running the business must come first, BU driving the design work, IT driving the development, This is going to be difficult!
Change Management
Communication
Communicate Early & Often
Reduces chance of miscommunication
Reduces stress associate with uncertainty
When people feel involved, they take ownership
Power-user Development
Builds system expertise in BU for future enhancement work
Speeds transition period after go-live
Reduces dependency on Tulsa IT
Training
Training development
On-line help development
Training delivery
Decision Making?
Business must own, Clear decision-making process, Advantage over Products because of size, Impacts to system, processes, and people
Test, Test, Test
Must have user involvement, Close to parallel as possible, Reduces the risk of business interruption, Reduces post go-live heartburn
Data
More data required, Automated feeds provides better results, Establishes the foundation for optimization
It ain’t over till it’s over
Incremental approach, Project doesn’t end at go-live!, this will be HARD, not plug and play, There will be startup issues, Post go-live optimization

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