Torsional, Axial and Lateral Bottom Hole Assembly Vibrations

Torsional, Axial and Lateral Bottom Hole Assembly Vibrations Experimental investigation of torsional, axial and lateral bottom hole assembly vibrations 1. Introduction Introduction The oil and gas industry is one of the largest and the most globalized industry in the world. Petroleum products include plastics, fuels, ointments and many more. With increases in world population, consumption and demand of petroleum products have increased. Primarily petroleum products are used as energy sources. With an increase in demand, different, unconventional sources are being explored. Drilling in itself is a complex process due to the unknown formations in the earth. A hole is drilled in the earth with a bit, and tubulars are attached to it to provide axial force and rotation. The tubulars are hollow through which the drilling fluid is circulated to extract the cut rock. Once the hole is drilled, the bit and tubulars are taken out, and a larger tubular is pushed down the hole and cemented around the annulus to stop the hole from caving in. The process is the same as drilling a water well but with greater depth, pressures, temperatures and complexities. Some of the oil and gas sources are too deep or too complex to be explored, but with advanced technological development in drilling, extended reach, multilateral and horizontal wells, it is now possible to extract unconventional oil and gas. Vibrations When an entity oscillates around its equilibrium point, the entity is said to be in vibration. In most of the cases vibrations are undesirable, as they cause harm to the system and dissipate energy. When force or energy is imparted to a system, vibrations occur. In absence of external excitation, the vibrations are called free vibrations. Systems in state of free vibrations oscillate with natural frequencies, which are dependent on the properties of system. With the presence of external excitation, vibrations experienced by the system are called forced vibrations. Vibrations become increasingly large and are most damaging when the excitation frequency is close to one of the natural frequencies. This phenomenon is called resonance. When there is an energy dissipation from the system in terms of heat, sound, friction or any other method, the resulting vibrations are called damped vibrations. The drillstring assembly is a very long, slender system prone to excessive vibration due to the various forces acting on it. Primary forces on the BHA are torque due to rotation and bit rock interaction, axial forces due to gravity and lateral forces due to bending of the long pipe and hitting the walls of the borehole. Types of Drillstring Vibrations Drillstring vibrations are categorized based on the forces acting on it, which are Torsional, Axial and Lateral forces. These forces correspond to the three types of vibration: 1) Torsional vibrations, 2) Axial vibrations and 3) Lateral vibrations. Torsional Vibrations: Drillstring is rotated from the surface to provide torque or shear force to cut the rock. 3. Experimental Setup A lab-scale drilling rig was constructed for the purpose of competing in Drillbotics International Student Competition. OU Drillbotics team participated and won the competition in 2015. The budget restrictions limited the quality and quantity of sensors mounted on the rig. The rig was upgraded in 2016 with the additional budget. The following sections describe the rig setup and sensors installed, dividing them based on the systems: (i) Rig Structure, (ii) Hoisting System, (iii) Rotary System, (iv) Circulation System, (v) Measurement, Instrumentation and Control System and (vi) Drillstring Assembly. Rig Structure Rig Structure consists of three major parts: substructure, mast and travelling block. Rig Substructure In-house built structures have been found to be significantly cheaper than readymade structures in the market. Moreover, the former provides flexibility in the selection of dimensions, load ratings and design styles. This substructure was designed to pass through doors, so the rig could be used for future educational purposes. The rig substructure was constructed using 1ÂÂ ½ square-iron tubing with overall dimensions of 84 x 27 x 36. To allow rig mobility, five commercial grade caster wheels were installed, each with load capacity of 1000 lbs. A 47 x 27 shelf made of ÂÂ ¼ thick iron sheet was added for installation of circulation system and electrical box. This left the rig with a space of 37 x 27 x 36 to accommodate the rock sample. 3.1.2 Mast A mast of cantilever design was constructed out of Aluminium, as shown in Fig. 3.1. Figure 3.1: Rig mast laid down on the substructure top Constructing the mast with aluminium reduced the weight by 2.5 times to that made by steel. A 10-inch-wide C-Channel was supported by two 90 angle bars. The base was attached to the table with hinges for reclining and easy transport of the rig. 3.1.3 Travelling Block The travelling block slides on a pair of linear guide rails attached to the mast. Linear roller bearings or pillow blocks attached to the back of the travelling block provide near smooth motion. Two horizontal plates were bolted on the vertical plate. The upper plate acted as a mount for the AC motor and lower plate supported the swivel. A torque sensor was placed in between motor shaft and swivel. The total weight of the travelling block was measured to be 77.72 lbs. Figure 3.2: Travelling Block Assembly 3.2 Hoisting System Hoisting system components include a double acting air cylinder, pneumatic lines, a couple of pneumatic convertors (Fig. A.1 and Fig. A.2) and a compressed air supply line. Regulated compressed air-line up to 130 psi was hooked up to the pneumatic convertors. Two pneumatic lines from the convertors of maximum capacity 120 psi controlled the air flow and connected to the inlet ports of the dual acting piston. Dual acting air piston has a 1.125 inch bore and a 36-inch stroke length. The system has a capacity to hoist a load of 119.28 lbs. 3.3 Rotary System A top drive system was installed with a 1 HP motor and a maximum RPM of 1170 on the motor mount of the travelling block. The motor shaft is connected to the omega torque sensor via a spring coupling. The torque sensor has a rotating shaft to shaft configuration with an operating speed of 5000 RPM. The torque sensor is connected to the swivel via another spring coupling. The swivel was designed and fabricated in-house with pressure rating of 300 psi and brass outer body for corrosion resistance. The chrome plated rod is wear-resistant to the abrasion of the seals. Swivel rod is attached to an adapter at the base of the bottom plate. A four bolt flange mounted ball bearing prevents any load from being transmitted to the rotary assembly. 3.4 Circulation System It is important to remove cuttings from the hole to drill further ahead. To accomplish this, water, oil and foam based drilling fluids were taken into consideration. Water from the city line without any additives was chosen as drilling fluid after taking cost of a closed loop system for recirculation and cost of additives and base fluids into account. It was also assumed that the effect of drilling fluid on drillstring vibrations was negligible. A roller pump with a pressure rating of 300 psi was installed to circulate the water down the drillstring assembly. A 1.5 HP 3-phase motor powers the pump. The Omega digital display flow meter, which was installed after the pump, can monitor flowrate up to 15 GPM. Pressure monitoring is done by a pressure transducer of rating 500 psi. Pressure fluctuation of up to 50 psi was observed due to intermittent flow supplied by the roller pump. A pressure dampener was built with spare couplings and installed upstream to the flow meter. This provided smooth and stable flow. An analog pressure gauge was mounted atop the dampener to monitor fluctuation. Rubber hose with a pressure rating of 300 psi connects the flow meter with the swivel. Drilling fluid from the swivel then flows into the drillstring and comes out of the bit nozzles and out of the hole through the annulus. As the drilling fluid is just water, it is passed down the sewer line along with the cuttings and not recirculated. 3.5 Measurement, Instrumentation and Control System The Measurement, Instrumentation and Control system is the most important system in the automated rig. The sensors are mounted on the rig at various places for different functions. They provide analog data to the data acquisition module Omega DAQ-3001. An electrical box is mounted at the bottom shelf for shielding the card and other signal conditioners from electrical interference. The data from the DAQ module transfers into the desktop computer, which is installed on the rig structure for control of the automated rig and storage and display of data. Excel-based VBA program is used for the operation of the rig. 3.5.1 Measurement Sensors Following are the sensors installed on the rig to monitor performance of the rig and drilling process. 3.5.1.1 Displacement Laser Sensor An aluminum strip is attached to the top of the travelling block with a reflective tape stuck on it. A Banner laser sensor is mounted about 0.5 inches above the travelling block on the mast. It can measure maximum displacement up to 3.93 inches with an accuracy between 0.019 inch to 0.039 inch. 3.5.1.2 Lateral Vibration Laser Sensor To measure lateral vibrations of the drillstring, an xyz laser sensor is used. It can measure distance from 1.57 inch to 6.29 inch with an accuracy of less than 20 micrometer. The sensor was earlier mounted on an aluminium plate attached to the travelling assembly. But the strip was long and excessive vibrations due to bit rock interaction caused the strip to vibrate at high amplitude, providing inconclusive and erroneous data. Hence the mounting structure was made of a square iron tubing to give a sturdier structure. The vibration amplitude was then reduced and could be observed only at excessive vibrations due to higher RPM and WOB. 3.5.1.3 Optical RPM Sensor An LED-based, reflective type optical RPM sensor, which can measure up to 15000 RPM, is mounted on the cage of swivel. Reflective tape is stuck on the spring coupling between the swivel and torque sensor. The sensor is mounted at an angle so that the reflective area increases for better measurement. 3.5.1.4 Torque Sensor It is assumed that torque measured by the torque sensor is the torque due to bit-rock interaction. An Omega rotating shaft to shaft torque sensor has been mounted above the swivel with a torque rating of 64 inch-pounds. 3.5.1.5 Axial Vibration Sensor An axial vibration senor is installed at the bottom plate of the travelling block adjacent to the flange mounted ball bearing. The VBT-1 vibration sensor has a micro-electro-mechanical system which sends a voltage proportional to the vibration velocity to the data acquisition module. It measures vibration velocity from 0-25 mm/sec. 3.6 Drillstring Assembly The drillstring assembly comprises of 3 parts, Aluminum pipe, bit sub and bit. The pipe is made of Aluminum 6061 with an OD of 0.375 inch and a thickness of 0.035 inch. Both ends of the pipe have 3/8 NPT male compression fittings attached on it. It is connected on one end to 3/8 NPT female brass adapter which is connected to the swivel rod and other end is connected to 3/8 NPT female bitsub. The bit sub is made out of stainless steel for corrosion resistance. It has 3/8 female NPT threads on both ends. A roller sleeve with OD of 1.1 inch and ID of 0.9 inch is slide upon the bit sub to act as a stabilizer and provide smooth rotation. It has a counter bore to place constriction of various sizes to change pressure drop in the system. The bit is fabricated in house using stainless steel round bar and machined to replicate the baker huges bit provided for the competition. The cutters were bought from vendors and the OD of the cutters available was 0.5 inch. They are made out of carbide as opposed to the diamond cutters provided and also wears down faster. The cutters are screwed on the cutter faces and are replaceable. 4. Methodology This chapter describes the procedure of the experiments performed and the data collected. It also talks about some assumptions, sensor calibration and data analysis. 4.1 Experimental Procedure The rig and all its components are powered on and the Excel program initiated. The program has a separate sheet which takes the variables of the experimental run as an input. The only variables changed for the set of experiments are RPM and WOB. Another variable, which is the height at which the string starts to rotate was also been varied but it did not have any effect on the data. A pilot hole of 1.25-inch diameter and 1-inch depth was drilled into the rock sample using a coring bit and hammer-chisel to insert a guide shoe in the hole. The 6-inch long guide shoe acted as a borehole wall and prevented bit walking. Using a level indicator, the rock sample was adjusted to be horizontal. The drillstring was the attached to the swivel adapter and rig was then slid over the rock to align the drillstring and the guide shoe. Using the leveling screws the rig was jacked up to be horizontal. The inlet air pressure line and water line were opened up. Once all experimental variables were set, the program was initiated using the Start button. The first step of the program was to hoist the travelling block to the topmost position. At this point a safety bar used to keep the travelling block hoisted was taken away. The travelling block slowly lowered down and once the bit was inside the guide shoe, top-drive motor and pump motor got activated and string started to rotate along with water pressurized inside the pipe. The bit gradually touched the rock and drilling process began. A trial run was carried out to check if the systems were working properly and data was being collected. A couple of millimeters were drilled during the trial run so that the hole got initiated. After a trial run, experimental runs were carried out. Each experiment was run for 6 min and stopped using the Stop button in the program. The pump stopped pumping fluid and drillstring stopped rotation. Travelling block was gradually lifted up to the topmost position. After that new experimental variables were set and the next run was carried out. Experiments were performed on 2 different rock samples. First set on a very hard and compacted sandstone and the other on a very soft unconsolidated sandstone. UCS of the hard sandstone ranged from 6000 to 9500 psi while UCS for the soft sandstone ranged from 2000 to 5000 psi. 4.2 Data, Collection and Analysis Data was continuously collected by Omega data acquisition system module and stored in an excel sheet. The data of interest were WOB, RPM, Torque, Axial Vibrations, Lateral Vibrations and ROP. Different plots were generated against variables of interest to observe dependency and behavior of the variable under investigation. 4.2.1 WOB and RPM Data WOB is an independent variable with respect to our investigation. WOB was measured using a load cell attached to the back travelling block connecting the piston. The calibration of WOB was carried out in the following procedure. The rig was slid on a weighing scale. A set number of values were entered for voltage sent to the bottom pneumatic convertors. A constant voltage of 2 volts was sent to the top pneumatic convertor to provide a constant pressure of 20 psi resistance against erratic bouncing and to provide a constant friction between piston and cylinder walls in either direction. Reading on the weighing scale was recoded as WOB. Initially the WOB calibration was performed in a static condition. It was observed that WOB reading during the experiment was different than the expected values based on calibration. It was assumed that the change of conditions from static to dynamic was the cause of difference. Hence to simulate dynamic conditions while calibration, rig was constantly hammered down with a mallet to cause the rig to vibrate and negate static friction. The stabilized reading on the scale was used for calibration. But hammering still did not replicate the vibrations happening during the drilling process and hence the WOB measurement by the load cell was different from expected based on the calibration. Hence average value of the WOB was calculated for complete experimental run and considered as the WOB which is being exerted on the rock for cutting process. The average WOB observed had a change of 19.9 % to -20.6 % from the expected input values. In actual drilling process, the WOB is never constant. As the drilling proceeds the WOB decreases and driller lowers the drill string to increase and maintain the set WOB. Hence a ÂÂ ± 20 % change from the set point is acceptable. RPM data was obtained from the optical RPM sensor which was calibrated using a handheld RPM sensor. At lower RPM the error was around 8 % and at higher RPM it lowered down to 0.5 %. So at lower levels the set point was decreased by 4 to compensate for the error. 4.2.2 Torque, Axial and Lateral Vibration Data A rotating shaft to shaft torque sensor was placed in between the motor and swivel with a spring coupling on each end. Torque was calibrated using a torque wrench. When run at idle conditions without any drilling action, torque reading obtained was assumed to be friction. That extra torque of 1.114 inch pounds was assumed to be a side force or the friction inside the swivel and other rotating parts such as the flange mounted ball bearing. A laser displacement senor was attached to the mast to detect the magnitude of lateral vibrations. It was aimed at the center of the drillstring such the pipe was always in range of the laser. The laser sensor was kept 4 inches away from the center of pipe. NPT connections are inherently non concentric and causes non-alignment of pipe. The pipe wobbled due to non-alignment and it oscillated far and near to the sensor. Hence there was a negative and a positive value for displacement. The most negative value of the displacement was used as a reference zero and complete data was shifted towards positive with -0.24165 inch as a reference zero. Greater the magnitude, pipe travelled farther away from the sensor indicating higher lateral vibrations. An axial vibration sensor was attached to the bottom plate of the travelling block. It had micro-electro-mechanical system inside to detect the vibration speed and send a proportional voltage signal for measurement. The sensor came calibrated from the manufacturer and it had a direct vibration-velocity to voltage relationship provided by the manufacturer. 4.2.3 ROP data ROP was directly calculated by the program by dividing the depth drilled by the time it took to drill and stored in the Excel sheet. As the Hard sandstone was difficult to drill the sensor could not measure any significant change in drilled depth along with the vibrations of the assembly and the error in measurement. Hence ROP data for Hard sandstone is not taken into consideration. Soft sandstone data was collected and analyzed for effect of vibrations and other parameters. 4.3 Data Analysis Data was collected from the point where the bit touches the rock to the point when the program was stopped. All experiments were run for 6 minutes in which an average of 100 data points were collected in an excel sheet. An average of those data was calculated and stored. Average values of torque, axial vibrations and lateral vibrations were plotted against RPM and WOB separately. A trend of data was analyzed based on the plots. With increase of RPM, change of torque, axial and lateral vibration was observed. Same practice was carried out for WOB. The plots are shown in Appendix B. 5. Results and Discussions Torsional Vibrations Hard Sandstone: Looking at the plots (Fig. 5.1), with an increase in RPM at constant WOB, torque gradually increases. At around 300 RPM, there is a sudden increase in some cases which then decreases. This behavior is unexpected and no conclusion has been found for the reason for the abnormality. It can be assumed that there would be some abnormally hard layer during drilling due to which such an increase is observed as no such trend was observed in the uniform soft sandstone. But general trend is a gradual increase in torque with an increase of RPM at constant WOB. No oscillation of torque was observed indicating absence of stick-slip. Figure 5.1: Torque vs. RPM plot at constant WOB for experiments on hard sandstone At constant RPM, with increase in WOB there is a gradual increase in torque (Fig. 5.2). No specific trend for RPM is observed as some of the low RPM cases also have higher torque than high RPM cases. Figure 5.2: Torque vs. WOB plot at constant RPM for experiments on hard sandstone Soft sandstone: Observing the plot for soft sandstone (Fig. 5.3), a gradual increase in torque was observed with increase in ROM at constant WOB. No oscillation of torque was observed indicating absence of stick-slip. Figure 5.3: Torque vs. RPM plot at constant WOB for experiments on soft sandstone There is a clear and distinct trend for increase in torque with increase in WOB at constant RPM (Fig. 5.4). Figure 5.4: Torque vs. WOB plot at constant RPM for experiments on soft sandstone Lateral Vibrations Hard Sandstone: Plot (Fig. 5.5) shows that there is a gradual increase of torque with increase in RPM at constant WOB. Figure 5.5: Lateral Vibrations vs. RPM plot at constant WOB for experiments on hard sandstone No general trend is observed for initial low WOB experiments (Fig. 5.6). With increase in WOB the lateral vibrations decreased in low RPM case and increased in high RPM cases. Figure 5.6: Lateral Vibrations vs. WOB plot at constant RPM for experiments on hard sandstone Soft sandstone: There is a general trend of increase of lateral vibrations with increase in RPM (Fig. 5.7) but it is not as significant as in hard sandstone. Figure 5.7: Lateral Vibrations vs. RPM plot at constant WOB for experiments on soft sandstone The data is too scattered to find a general trend for effect of WOB on lateral vibrations at constant RPM (Fig. 5.8). However, the trend at higher WOB shows a decrease in lateral vibrations. This can be attributed to the stiffening of the pipe due to higher axial load OR the pipe is bent and misaligned is making it bend more on the sensor side decreasing the deflection. Figure 5.8: Lateral Vibrations vs. WOB plot at constant RPM for experiments on soft sandstone Axial Vibrations Hard Sandstone: Axial vibrations follow a similar trend to torque (Fig. 5.9). With an increase in RPM, axial vibrations increased. Similar to the trend for torque, some cases have abnormally high vibration magnitude at 300 RPM which can be attributed to abnormally hard layer of formation. Figure 5.9: Axial Vibrations vs. RPM plot at constant WOB for experiments on hard sandstone Following the general trend axial vibrations increased with an increase in WOB at constant RPM (Fig. 5.10). Figure 5.10: Axial Vibrations vs. WOB plot at constant RPM for experiments on hard sandstone Soft sandstone: With increase in RPM, axial vibrations increased (Fig. 5.11). However for soft sandstone the trend do not resemble the trend in torque. In fact, it resembles more to the trend in ROP (Fig. B.10). There is a sudden increase in axial vibrations at 700 rpm and then it decreases gradually. Figure 5.11: Axial Vibrations vs. RPM plot at constant WOB for experiments on soft sandstone The data is too scattered to find a general trend for relationship between WOB and axial vibrations (Fig. 5.12). Figure 5.12: Axial Vibrations vs. WOB plot at constant RPM for experiments on soft sandstone 5.4 Effect on ROP Hard Sandstone: No significant data available for any analysis. Soft sandstone: ROP increases with an increase in RPM at constant WOB (Fig. 5.13). It peaks at around 700 RPM and then it decreases. Figure 5.13: ROP vs. RPM plot at constant WOB for experiments on soft sandstone At higher RPM, higher WOB has an increased effect on ROP (Fig. 5.14). But no dependence of WOB can be seen at lower values of RPM. Figure 5.14: ROP vs. WOB plot at constant RPM for experiments on soft sandstone 6. Conclusions and Recommendations Conclusions At constant WOB, with increase in RPM, increase in lateral vibrations in hard sandstone is higher than in soft sandstone which indicates that lateral vibrations also depend on type of formation. Axial vibrations are highly dependent on torque. No matter what RPM, WOB or the formation type is taken into account if there a change in torque, corresponding change will be observed in axial vibrations. WOB has less effect on excitation of axial vibrations in soft rocks and more effect in hard rocks. Hence the setpoint WOB should be decreased for drilling into hard rocks. RPM of 700 is the highest RPM which can be used to obtain highest ROP without taking the increased vibrations into account. Increase of RPM further lowers the ROP which can be attributed to such increased vibrations and velocities that the bit does not get enough time to contact and drag the rock surface. 6.2 Recommendations and Future Work Although the design of the rig was optimized, there is always room for improvement. With an increase in budget and limited design constraints, the rig can be constructed better. Following are the recommendations for upgrading the rig. The software program used for the control algorithm can be upgraded to Labview or Dasylab which are more user friendly for programming the automation and control architechture. Using Labview or Dasy lab will allow to operate on a faster computer with a recent operating system which will help in faster data collection and storage. A vibrating element can be attached to the travelling block when WOB calibration is performed so that error due to change in friction values can be negated. The spring couplings attached to the torque can be upgraded with a higher torque rating to prevent failure at higher vibrations. A stable support structure for the torque sensor and laser deflection sensor can be provided. If the bit can be obtained or manufactured with diamond coated cutters, then a set of experiments can be designed where relationship could be examined between RPM, WOB and the depth of cut. Forward and backward whirl characterization experiments could be performed with improved sensors for detection of whirl rates. Hammering action can be included in the drilling action and its effect on ROP, lateral vibrations, torque and axial vibrations could be analyzed. References Braun, Simon G. Ewins, David J. Rao, Singiresu S.. (2002). Encyclopedia of Vibration, Volumes 1-

Marry Shelley :: essays research papers

  Ã‚  Ã‚  Ã‚  Ã‚  Mary Wollstonecraft Shelley was born on August 30, 1797, in London, England. She was destined to live an extraordinary life. Her parents were two of the most noted freethinkers of the Enlightenment era. Her father, William Godwin, was a celebrated philosopher and historian. He was known for overeating and borrowing money who would give him a loan. He didn’t have much time for anything but his philosophical ideas. He met his match in Mary Wollstonecraft, Mary’s mother. She was every bit as much a radical thinker as Godwin. She declared herself independent at the age of 21. She and her sisters ran a school in France, where she had an affair with an army captain and had her first child, Fanny, out of wedlock. After being abandoned, she and Fanny moved back to England and attempted suicide. She began writing. She was well-known for her revolutionary feminist writings. Wollstonecraft and Godwin met a dinner party at Godwin’s home and the two began an affair. Wollstonecraft was five months pregnant when she married Godwin. Although Godwin and Wollstonecraft didn’t agree with the whole marriage thing, they wanted Mary’s children to be legitimate children. Mary’s mother died of complications just ten days after Mary was born. Her father was a self-absorbed intellectual and was left to take care of his daughters all alone. Although he loved his daughters, the responsibility of raising them on his own was too much for him and soon began looking for a wife.   Ã‚  Ã‚  Ã‚  Ã‚  Godwin married four years later to Mary Jane Clairmont. She turned out to be a mean and shallow woman who favored her own two children over Mary and Fanny. Mary was a lively child and was often treated unfairly by her stepmother. She received frequent whippings which led to her rebellion of a girl’s traditional role. As a result of this, Mary kept to herself and was unhappy and alone. Although she didn’t have a formal education, she picked up on the intellectual environment created by her father and his visitors. Mary was quite bright and began reading the writings of her mother around the age of eight. She had memorized every word by the age of ten. Mary spent many hours at her favorite reading spot, her mother’s grave.   Ã‚  Ã‚  Ã‚  Ã‚  Percy Shelley, a poet, was an admirer and friend of William Godwin and spent a great deal of time at the Godwin house. Shelley also admired the writings of Mary’s mother.

Investment Account Essay

What is the meaning of Al-Awfar? Al-Awfar means â€Å"prosperous investment†. 3. What is the difference between Al-Awfar Savings Account and Investment Account-i and the normal Bank Islam Savings Account-i and General Investment Account-i (GIA)? Al-Awfar Savings and Investment Account-i is a rewarding account that offers a host of additional features, which include expected Mudharabah returns on savings and investments (if any). This is in addition to the opportunity to receive cash prizes from the bank through a quarterly prize draw. 4. Is Al-Awfar Saving and Investment Account-i a form of gambling? NO. Al-Awfar Savings and Investment Account-i is free from any elements of gambling. 5. Is Al-Awfar Savings and Investment Account-i Shariah-compliant? YES. The Shariah Supervisory Council of Bank Islam approved this product in its 102nd meeting dated 7th April 2008 (30 Rabiulawal 1429H). 6. Are prize draws allowed according to the Shariah Law? YES. Prize draws are permitted if there is no elements of riba (usury), gharar (uncertainty) and maysir (gambling). 7. What is the basis on the permissibility of draw in Islam? 1. Al-Quran, in Surah Ali ‘Imran verse 44 This is a part of the news of the Ghaib (unseen, i. e. the news of the past nations of which you have no knowledge) which We inspire you with (O Muhammad ). You were not with them, when they cast lots with their pens as to which of them should be charged with the care of Maryam (Mary); nor were you with them when they disputed. . Is the draw performed in a manner that is transparent to the public? YES. There is an external independent draw committee who will observe the draw process. 9. What is the difference between Al-Awfar Savings and Investment Account-I and other competitors’ product? Al-Awfar Saving and Investment Account-i is the first product of its kind introduced by an Islamic bank, which meets all Shariah requirements. 10. Where does Bank Islam invest the funds deposited by customers? Bank Islam invests the fund in Shariah-compliant investments pproved by the bank’s Shariah Supervisory Council. 11. Can the cash prizes received be used for Ibadah purposes, e. g. performing the Hajj and Umrah or given away as Zakat and Sadaqah? YES. The cash prizes come from a Halal source. Upon receiving the cash prize, the customer is free to use it for any purpose 12. Are the cash prizes taken from the profit earned through Al-Awfar Savings and Investment Account-i? NO. The cash prizes are provided by the Bank and are not specifically derived from profits of Al-Awfar Savin gs and Investment Account-i.

Mission, values and key objectives of Faysal Bank - Free Essay Example

Sample details Pages: 13 Words: 3940 Downloads: 8 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? Organization:- An organization is a person or group of people intentionally organized to accomplish a common goal or set of goals. Faysal Bank Limited:- Introduction of Faysal Bank Limited:- Faysal Bank Limited was incorporated in Pakistan on October 3, 1994, as a public limited company under the Companies Ordinance, 1984. On January 1, 2002, Al Faysal Investment Bank Limited, another group entity in Pakistan, merged into Faysal Bank Limited which resulted in a larger, stronger and much more versatile institution. Mission:- Mission or Purpose is a precise description of what an organization does. It is a definition of why the organization exists currently. Each member of an organization should be able to verbally express this mission. A mission statement focuses on the how of your business. Faysal Bank Mission:- Achieve leadership in providing financial services in chosen markets through innovation. Values:- A value is a belief, a mission, or a philosophy that is really meaningful to the company. Faysal Bank Values:- Our daily code of conduct is exemplified by eight core values: * Threshold values values at the heart of our brand. * Differentiator values values that set our brand apart. Threshold Values:- * Integrity- Our Integrity: Our Identity * Team Work- Our Team Work: Our Asset * Respect- Our Respect: Our Duty * Professionalism- Our Professionalism: Our Competence Differentiate Values:- * Passion- Our Passion: Our Worth * Responsiveness- Our Responsiveness: Our Distinguisher * Innovation- Our Innovation: Our Strength * Compassion- Our Compassion: Our Gift Objectives:- Objectives give the business a clearly defined target. An objective is something you want to achieve. Faysal Bank Objectives:- * Prime focus to earn profit by providing values to its customers. * To provide superior services to its customers. * To provide assistance in the development of the commerce and trade industr y. * Focus on blending skills and experience towards creating an enabling environment. * Core focus is to inculcate a culture of collaboration intended to deliver world class customer service. * To promote and boost up business sector inside the country. * To provide the employment opportunities in the country. * To provide loan and advances to help out in self employment schemes * To earn profit for the bank itself and for its stakeholders. * To create maximum economic value for shareholders through constant relationship focuses on financial services. Stakeholders:- Stakeholders are individuals or groups who have an interest in an organizations ability to deliver intended results and maintain the viability of its products and services. In the development of a firms mission and vision is a good place to start, but first, of course, you must identify critical stakeholders, get a handle on their short- and long-term interests, calculate their potential influ ence on your strategy, and take into consideration how the firms strategy might affect the stakeholders (beneficially or adversely). Stakeholders can be internal as well as external Internal Stakeholders:- Internal stake holders are individual or groups inside a business or an organization. External Stakeholders:- External stake holders are individuals or groups outside the business who are interested in the decisions an organization makes. Overall stakeholders include owners or shareholders, managers, employees, customers, government, suppliers, communities and Investors. Some stakeholders may have more than one interest in a business. An employee might also be a stakeholder. Managers are employees of the business, a customer might be a member of a local community but yet they can be stakeholders. Stakeholders in a business will usually benefit from their involvement with the organization. Employees will earn money which they can spend on goods and services. Customer s will consume the goods and services supplied by the business and the government will collect tax from the organization. P2:- Evaluate the extent to which an organization achieves the objectives of three stakeholders. Interest Objectives of Stake holders:- Different Stake holders have diverse objective and they have different affects on an organization or business. According to Michael Novak following are seven points that should be kept in mind according to business ethics when developing relations with stakeholders. * Customer satisfaction by providing goods and services of real value. * Reasonable return on the funds entrusted to the business by its investors. * Create new wealth * New job opportunities * Promote invention and creativity * One of the most important is to diverse public interest into different sectors of life. Following are the needs of the stakeholders that the organization caters to for their complete satisfaction. * Shareholde rs want regular, secure and high returns. * Managers want responsibility, high rewards and a lack of interference in their actions. * Employees want high earnings, an interesting job and secure employment. * Customers want quality products at low prices and a good service * Suppliers want secure, regular and profitable orders. * Government wants to achieve a large number of goals including growth in the economy and low inflation. * The local community wants thriving local businesses which do not cause problems. P3:- Explain the responsibilities of an organization and strategies employed to meet them. Responsible Behaviour of an Organization:- Social Responsibility:- Agency theory devised by Milton Friedman says that the social responsibility of an organization is to generate the possible profit for its shareholders with fair competition, no fraud, etc. It should be understood that the managers of a firm are no more than agents working on behalf of the o wners. But at the other end, the stakeholder theory emphasizes a broader set of social responsibilities for business (Mullins, 2005). Ecological Responsibility:- Ecology and the increasing destruction of ecosystems and natural resources have a widespread concern from the public, the governments and inter-governmental agencies. Business organizations in the whole world are required to conduct an Environmental Impact Assessment (EIA) for their new operations or expansion of the existing ones. EIA is a detailed study of the likely environmental consequences of the new development, together with plans to avoid causing damage or to repair damage that cannot be avoided. The EIA takes into account whether resources used are renewable or non-renewable. Allaby elaborates that the cost of obeying regulations may inhibit innovation and apart from the economic effect, this may delay or even prevent the substitution of new products and processes for old ones. Business Ethics:- Busine ss ethics has a broad spectrum, because any action by a firm or one of its employees can be done ethically or unethically (Mullins, 2005). Thus the behaviour of a business towards its customers, competitors, suppliers, employees, the environment, local communities and other stakeholders will certainly reflect the organizational cultures in terms of ethics adopted or neglected. Sternberg includes two tests of the decency (e.g. refraining from stealing, cheating) and distributive justice (i.e. ensuring that rewards are proportional to contributions made). Therefore, an organization is said to be ethical if it satisfies three tests of: * long-term wealth growth of its owners; * common decency * distributive justice If it fails in any of these three tests, the organization is deemed unethical. Management Responsibilities:- The stakeholder view suggests that management is responsible not only to the organizations owners (Shareholders), but also has responsibilities to: * Employees * Customers * Suppliers * Competitors * The Local Community * The general public (and government) Public Relations and Corporate Image:- Corporate image describes the public attitude towards a company, or the image of the company in the mind of the general public and, perhaps more specifically, in the minds of potential customers. It is possible to promote a desired corporate image through a combination of public relations, advertising and the experiences and attitudes build up by customers over the year. (For example, the favorable corporate image of Marks and Spencer grew up over many years, without the need for substantial PR or advertising.) P4:- Explain how economic systems attempt to allocate and make effective use of resources. Economic System:- Economic systems comprises of a long list, some of which are as under:- * Capitalism * Socialism * Mixed Economy Capitalism (Free Enterprise):- Capitalism is an economic syst em characterized by a free market in which means of production and distribution (the land, factories, technology, transport system etc) are privately owned referred to as the capitalist class. The people who sell their ability to work in return for a wage or salary are referred to as the working class. The working class is paid to produce goods and services which are then sold for a profit. The profit is gained by the capitalist class. The capitalist class lives off the profits they obtain from exploiting the working class while reinvesting some of their profits for further accumulation of wealth. Socialism:- Socialism is an economic system in which the means production and distribution of goods are owned by the community collectively usually through the government. Socialism is characterized by: * Production for use rather than profit * Equality of individual wealth * Absence of competitive economic activity * Government determination of investment, prices, and pr oduction levels Mixed Economy:- Mixed Economy is an economic system which allows the simultaneous operation of publicly and privately owned enterprises. It is an economy that reflects the elements of both capitalism and socialism. In a mixed economy, the private ownership as well as the state takes part in the means of production, distribution and other types of economic activities. Allocation of Resources in the Economic system:- In capitalism, the motive for producing goods and services is to sell them for a profit, not to satisfy peoples needs. While in socialism all rights and decision are taken under the government bodies. Everyone can get benefit from that economic system while in mixed economy both socialism and capitalism take place. P5:- Discuss the impact of Social welfare and Industrial policy. Social Welfare Policy:- Modern social welfare measures may include any of the following: the care of destitute adults; the treatment of the mentally ill; the r ehabilitation of criminals; the care of destitute, neglected, and delinquent children; the care and relief of the sick or handicapped; the care and relief of needy families; and supervisory, educational, and constructive activity, especially for the young. Industrial Policy:- Government provides the financial support and capital to the private sector by direct subsidies, tax credits, or government-run developmental banks. Industrial policy emphasizes cooperation between government, banks, private enterprise, and employees to strengthen the national economy. Impact of Social Welfare Policy on Faysal bank Ltd:- As Faysal Bank is a socially responsible corporate entity so it has been a regular contributor to the society and communities it operates in. The employees of the bank established a relief fund for Internally Displaced Persons from Swat, with the bank. The bank partnered with the Institute of Business Administration (IBA) Karachi to provide Rs. 50 million over a per iod of 3-5 years for sponsorship of one academic chair in IBAs Executive MBA program. The bank even donated 183 computers to different educational institutions with a focus on promoting education for the underprivileged. Impact of Industrial Policy on Faysal Bank Ltd:- The main impact on FBL is if the government of Pakistan increases the interest rate so the all banks will get affected by this decision. Due to more interest profit will decrease and people will be reluctant to utilize the services and facilities provided by the bank. P6:- Evaluate the impact of macroeconomic policy and its influence. Macroeconomic Policy Measures:- Macroeconomic is one of the two most general fields of economics that literally means managing economics at large. It deals with the entire economys performance, total amount of goods and services produced, decision making, structure and etc. It can be national, regional, or global economy. It includes the study of GDP, unemployment rates, a nd general behavior of prices to understand how the economy works. It also develops models for analysis of national income, inflation, savings, investment, international trade and etc. Fiscal Policy:- Measures employed by governments to stabilize the economy, specifically by adjusting the levels and allocations of taxes and government expenditures. When the economy is sluggish, the government may cut taxes, leaving taxpayers with extra cash to spend and thereby increasing levels of consumption. An increase in public-works spending may likewise pump cash into the economy, having an expansionary effect. Conversely, a decrease in government spending or an increase in taxes tends to cause the economy to contract. Fiscal policy is often used in tandem with monetary policy. Until the 1930s, fiscal policy aimed at maintaining a balanced budget; since then it has been used countercyclical, as recommended by John Maynard Keynes, to offset the cycle of expansion and contraction in the e conomy. Fiscal policy is more effective at stimulating a flagging economy than at cooling an inflationary one, partly because spending cuts and tax increases are unpopular and partly because of the work of economic stabilizers. Impact of Fiscal Policy on Faysal Bank Limited:- Due to rise in rate of taxation the selected organization has to pay extra taxes, and due to this it will cause reduction in investment because of less earnings and high taxes. The enlargement in the government expenses or payments will increase employment rate as well as the purchasing power of the people means they will spend more. This will cause rise in demand of hospital facilities and services. Monetary Policy:- Measures employed by governments to influence economic activity, specifically by manipulating the money supply and interest rates. Monetary and fiscal policy are two ways in which governments attempt to achieve or maintain high levels of employment, price stability, and economic growth . Monetary policy is directed by a nations central bank. In the U.S., monetary policy is the responsibility of the Federal Reserve System, which uses three main instruments: open-market operations, the discount rate, and reserve requirements. In the post-World War II era, economists reached a consensus that, in the long run, inflation results when the money supply grows at too rapid a rate. Impact of Monetary Policy on Faysal Bank Limited:- The supply of money will reduce, and the flow of money will be a smaller amount due to all this it will affect the business performance. Decrease in business actions will decrease buying power of people and income rate. Due to more interest profit will decrease and people will buy less services and facilities from the selected organization. M1:- Give your judgments about the organizational performance in achieving its objective and also satisfy its stakeholders. Banks Performance:- 2009 was the first year of implementation of banks five year strategy developed in 2008. The bank made considerable progress in all five pillars of strategic focus i.e. Customer Franchise, People, Risk Management, Processes and Financial Perspective. Customer Franchise:- Keeping in view the objective of being the bank of choice for customers, new initiatives were undertaken during the year. To improve customer experience, a service quality department was set up which developed a comprehensive service quality program covering customer experience measurement, process refinement and employee engagement. Islamic Banking: Barkat Islamic Banking was launched, that introduced Shariah compliant banking transactions. Alternate Delivery Channels: The Bank expanded its ATM network by adding 23 new ATMs taking the total ATM network to 116 ATMs across the nation. The bank also introduced real time Cash Deposit facility through ATMs on 13 Cash Deposit ATMs in selected cities. People:- Organizational structures across all functions were reviewed and aligned to focus on business, risks, costs and clarity of roles and responsibility keeping in view with the best practices. Similarly HR policies were reviewed and have been revised. A new performance management system was introduced. Trainings were also conducted for soft skills development of employees. Risk Management:- The Risk Management Framework was revitalized through inclusion of following functions:- * Special Asset Management Group focusing on account recovery and classified exposure management, and * Credit Administration Department engaged mainly in credit monitoring and security documentation. Processes:- The bank centralized five operational hubs into a processing centre for providing seamless services from one single location to the entire branch network. Two geographically separate centralized operation clusters have been created to behave as a backup site for each other in case of a major disaster at one location. Financial Perspective:- In line with the organizational setup, the MIS setup of the bank has also been changed from geographical to functional. During the year MIS level was graduated to the next level i.e. from business segment level to customer level. M2:- Discuss how much the organization acting responsibly under current circumstances. There are various ways and methods for an organization to consider so they can act responsible, however those various ways and methods also depend on the kind of organization you are working with. However, the organization we have selected to write upon is the banking sector. Banks are situated at at places ideal for customers and are environment friendly, as building do not pose threats to the environment. Given the nature of the bank work, which is mainly clerical or administrative, employees are not subject to occupational health hazards. However, a variety of occupational risks to health do exist in the banking sector, as in other cler ical occupations. It is the important for the employees health that adequate standards of hygiene, cleanliness and comfort are maintained in the workplace. It is difficult, to single out health risks involved to the banking sector that are not common to other clerical occupations and it is even more difficult to isolate any special problems in this area for employees of multinational banks. In the majority of cases, foreign and domestic banks are moreover governed by the same legislative standards with regard to health and safety and hygiene in workplaces, which are said to be respected by foreign banks and enforced through inspection at regular intervals. In a number of countries, particularly in Europe, enterprises of a certain size are obliged by law to set up a joint committee on safety and health to monitor the application of legal provisions, point out deficiencies and make suggestions for improvements. Many of the large banks have gone far beyond the legal prescriptions in their concern for protecting their employees health. For example, in a number of cases they have organized training sessions for employees on safety and health problems, precautionary measures in the workplace, fire prevention and other security matters. Ethical codes are rooted in a wider value system, as to what is right or wrong. Companies do have ethical responsibility and are not protected by limited liability from the consequences of their actions. A companys record and the perception of its ethics affect its reputation and ensure long term success or failure. The financial community has a history of placing moral considerations above legal or opportunistic expedients. But we are often exposed to moral dangers. Bankers role is one of stewardship based on trust. They are trusted by the people who ask them to look after their money and they have a duty to lend that money responsible. Banking is about rewards reflecting real risks and ethical considerations form an impo rtant part of their risk taking activities. The welfare of borrowing customers money, in good times and bad is of major concern in any business proposition. Bank depends on people to run their business and to reflect their ethical standards. Banks have to let their people know what is expected of them. A bank responsibility extends to Government, customers, shareholders, staff and community. In the future, as the banks face increasingly complex and conflicting issues, their resolve and commitment to ethical behaviour will be tested. D1:- Justify a choice of a new mission statement salient features. Mission Statement for Faysal Bank Limited:- Focusing on the customers loyalty by providing standard financial services, through developing and delivering innovative products and services keeping in view the stakeholders profitability. Features:- * Customers loyalty * Financial Services * Innovation * Stakeholders Profitability Customer Loyalty:- Objective of the bank is to provide valuable and superior services to customers, so for this the Bank is focusing on close and long term relationship with customers. Their prime aim is to facilitate their customers with more advanced financial services, so to make them loyal. Financial Services:- Objective of the bank is to provide assistance for an individual and business, so the bank is providing mixture of financial services to an individual and businesses for the development and promotion of individuals life and commerce. Innovation:- The focus of bank is to bring more new ideas in their services to their customers. Which will increase the market share of the bank and will led the bank serve more customers. Stakeholders Profitability:- By providing valuable services and innovation it will increase the stakeholders wealth. D2:- Recommend the broad strategies to achieve stakeholders Objective successfully. Strategies:- * Focus the business on the groups core skil ls and process technology. * Position the group in growth markets where our core skills are applicable. Environmental Technologies Division, which combines the skills in catalysts and process technology, is well positioned to serve these emerging markets. * Differentiate their strategies by using our world class technology. We will continue to invest significantly in research and development to develop new products and manufacturing processes. Technology is the key driver for most of the businesses and because of that organizations have a strong science base with technical centers located in all our major markets. * Maintain strong relationships with major customers, suppliers, government bodies and other stakeholders by investing resources on joint projects to ensure the group is well positioned for future market development. * Continue to invest in employees to ensure they are well trained, motivated and encouraged to meet the challenges of the future. * Ensure the business is run in a sustainable way by using resources efficiently. M3 D3:- What are the response of an organization towards social industrial policy and recommended solution. Social Welfare Policy:- The impact of Social Welfare Policy on Faysal Bank is sometime positive and negative. In case of providing free education and medical treatment etc the bank has to spent money which can affect their financial position. While on other hand, by providing these facilities students get motivated. The Bank provides facility of internship to fresh students to develop their practical skills. Faysal Bank provides Gratuity Fund to their employees. The Bank provides fund to IDPs, earthquake/flood affected people, in case of natural disaster in the country. Industrial Policy:- Industries are growing in this leading age so the Faysal Bank is also one of the leading Bank in the banking sector of Pakistan. The Bank provides variety of products of standardized nature which encourages the bank position to be stable in that sector. Against other competitors in the Banking sector, the Faysal Bank has provided innovative products and services to their customers and to business. Providing loans to businesses and encouraging different businesses and providing standard services by Faysal Bank is representing that the bank has given full response towards the industrial policy. Observation and Conclusion:- I observed Faysal Bank Limited a financially sound bank. Its profits are increasing year by year. Their staff is very good and sincere with the bank. According to my research Faysal Bank is not yet facing any major problems regarding Social Welfare Policy and Industrial Policy. Faysal Bank views specialization and service excellence as the cornerstone of its strategy. The people at Bank realize that innovation, creativity, reliability, customized services and their execution are the key ingredients for their future growth. They are aware that they have stepped i nto 21st century and they must meet its challenges by acquiring the highest level of technology. They will thus be accelerating their technological advances to enable them to distribute their products and services through most efficient and high technology means. Don’t waste time! Our writers will create an original "Mission, values and key objectives of Faysal Bank" essay for you Create order