The 35-plant merchant ASU fleet leaks $2.5–4.0M per plant per year across four measurable cost pools. The leaks sit across silos — APC cannot close them. Phase 1 is already delivered. Phase 2 is a six-month, single-plant, Finance-gated pilot of the coordination layer. Human-in-the-loop, read-only, kill switch at month 6.
This proposal originates from the LMB E2E Value Initiative. By moving beyond reactive, single-silo optimization, agentic AI activates our largest latent asset — the Airgas operating dataset — and converts it into a coordinated decision layer across plant, logistics, reliability, and energy. The ask is narrow, time-bound, and reversible.
Each plant in the 35-plant merchant fleet leaks $2.5–4.0M per year across four measurable pools. None are hypothetical. Scenario ranges are re-anchored at a day-30 baseline lock with Finance before any value is booked. The program is NPV-positive over three years even at the 50% capture sensitivity. At the planning base, the pilot pays back in roughly four months on $450K/plant annualized at the pilot ASU. Full fleet payback runs 12–18 months including Phase 3 buildout.
3-year NPV positive. No fleet rollout assumed. Pilot justifies itself on its own math.
4-month payback on pilot · 12–18 month payback on fleet rollout. Justifies Phase 3 authorization.
Full addressable across four margin pools. Requires Phase 3 pass + >80% operator adoption.
| Value driver | Type | Low ($K) | High ($K) | Notes |
|---|---|---|---|---|
| Demand forecasting — fewer emergency spot purchases | HARD | 150 | 200 | Medical O₂, fab ramps, refinery ramp-ends |
| Boil-off reduction via tank & load optimization | HARD | 120 | 160 | Measurable via SCADA historian |
| Energy time-of-use arbitrage (power ≈ 60–75% of ASU cost) | HARD | 100 | 150 | Finance model tab: TOU-Arb |
| Unplanned downtime avoidance (predictive maintenance) | AVOIDANCE | 80 | 120 | Engineer + Finance co-signed |
| Route & load optimization (outbound logistics) | HARD | 50 | 90 | TMS feed · Grade A / B only |
| Operator productivity (excluded from headline) | SOFT | 30 | 50 | Upside narrative only · not booked |
| Conservative band used in business case | — | $450 | $650 | 10% haircut applied to row totals |
Hard savings are Finance-defensible (energy, yield, throughput). Avoidance savings are engineer-plus-Finance co-signed. Soft savings are excluded from the kill-switch gate and never blended in the headline figure.
Phase 1 is done. It delivered a high-fidelity digital twin of the ASU — a simulator that models production, tanks, trucks, and customers the way an Aspen model does, but faster and with live decision layers attached. On top of it sits an 18-agent coordination layer. Scored against an Aspen HYSYS reference across ten weighted criteria, the twin scored 8.68/10. The weakest dimension was validation coverage at 4.0/10 — the reason the pilot exists.
Before the upside — how this program ends if it does not work. The program is designed to kill itself cleanly. That is the feature, not a caveat. Four gate criteria at month 6; all must clear simultaneously.
Annualized savings against day-30 locked baseline. Grade A (invoice / meter) & Grade B (engineer + Finance co-signed) only. Co-signed by the IT & Ops review board.
No safety incidents attributable to agent recommendations across the full pilot duration. Non-negotiable. Program ends immediately on breach.
Acceptance rate measured weekly from month 2 onward. Expect 40–50% at month 3, 70%+ at month 6. Ramp curve, not a flat line.
Per-plant business cases and Phase 3 sequencing plan submitted to the IT & Ops review board by end of month 6. Pass triggers separate Phase 3 authorization.
Failure on any one criterion triggers immediate program end. Only Grade A and Grade B savings count toward the gate. Grade C (modeled) is upside narrative only.
$1.8M · 6 months · 1 plant · operator-in-control · read-only · on-prem, behind the firewall. Every recommendation carries three things: a reason in one sentence, a confidence as a number, and a dollar impact. The system writes no setpoints. The operator approves, defers, or rejects.
| Parameter | Design |
|---|---|
| Pilot ceiling | $1.8M · Grade A + Grade B savings only count toward the gate |
| Duration | 6 months · month-6 kill-switch review |
| Plant | 1 ASU · selected by operations feasibility and instrument density |
| Mode | Read-only · zero setpoints written · recommendations surfaced to operator queue |
| Architecture | On-prem · behind the firewall · engineering-enforced (not policy-enforced) |
| Per-plant budget | $450K · Finance-validated savings target annualized |
| Operator role | In control · every recommendation requires explicit approval |
| Gate review | Month 6 · four criteria · all must clear |
| Go-live | July / August 2026 · requires Q2 2026 decision |
| In scope for the pilot | Explicitly out of scope |
|---|---|
| 1 live ASU · observation mode only | Live AI control of plant operations |
| Read-only feeds from SCADA, ERP, TMS | Any cloud egress of operating data |
| Agent recommendations reviewed by operators before any action | Workforce reduction or role changes |
| Finance-validated savings vs. day-30 locked baseline | Fleet rollout commitment before gate review |
| On-prem inference · no internet-connected model API calls | Writing of any setpoints or valve positions |
| 13-agent RCA subsystem for incident analysis | Autonomous decision execution of any kind |
Pilot (Phase 2) authorization is not a fleet rollout commitment. The fleet decision belongs to the month-6 gate. Approving this memo authorizes $1.8M for a bounded, observable, Finance-gated pilot on 1 plant. Nothing more.
| Line item | Amount | Notes |
|---|---|---|
| Execution team — 11 FTE blended over 6 months | $1,250,000 | Largest single cost driver · Lead/Sr/Mid ML, MLOps, Data, OT-Cyber, Eval, PM, Change-mgmt |
| On-prem infrastructure — Supermicro, 2× RTX 6000 Ada, FortiGate 100F, UPS | $220,000 | One-time capital · per-plant rig $103K–$143K + spare/contingency · retained post-pilot |
| Data integration and sensor calibration | $180,000 | Month 1 sprint · prerequisite to baseline lock |
| Change management and operator co-design | $150,000 | Dedicated lead · gate-measured output (≥70% acceptance) |
| Total | $1,800,000 | Hard ceiling. No overruns. |
Year-1 recurring OpEx (managed subscriptions per plant: Ubuntu Pro, Docker Business, NVIDIA AIE, Vault Enterprise, misc) is $11.5K – $26K/yr, separate from the $1.8M one-time pilot capital. Hardware retains all residual value if the pilot exits at month 6.
Five material risks. Four are contained inside Phase 2 engineering scope. One — data governance — requires executive air cover from the sponsor.
AI in industrial operations is already happening. Chemicals are ~50% deployed in production. Refining claims 30%+ productivity gains. Industrial gas is the sector that has not moved. Zero coordinated fleet deployments are publicly disclosed across Linde, Air Products, Air Liquide, or Nippon Sanso.
Four competitors occupy three quadrants — single-plant, single-agent AI. The upper-right quadrant — coordinated fleet operations — is empty. Not because it lacks value. Because it is hard: it requires cross-system data access, governance of operator trust, and a safety architecture that supports read-only agent recommendations at fleet scale. Hard = moat.
of manufacturers have deployed AI in production. Dow, BASF, SABIC run production-grade.
productivity gains reported. ExxonMobil, Shell, Chevron autonomous optimization.
coordinated fleet deployments disclosed. Announcements, not shipped fleets.
The decision is which branch we are on by Q3 2026. Both are live paths; neither is free.
July kickoff on calendar. Month-6 gate data lands Q4 2026. If the gate clears, Phase 3 authorization request enters Q1 2027 on a de-risked footing. We are the reference case the industry studies.
A competitor announces coordinated fleet operations in 2027. We restart Phase 2 against a moving benchmark, without the moat window, and with a data-governance sponsor who now has to explain the delay. Same pilot, higher hurdle, less optionality.
Three decisions, one sponsor, one date. All three must be taken together — partial approval stalls the program on the calendar we need.
Phase 2 against the already-approved agentic-AI envelope. Ceiling, not a forecast. By end of Q2 2026.
Cross-silo authority over IT, Ops, Finance. The one risk engineering cannot mitigate alone.
Funding release before Q2 close — enables July/August kickoff with 6-month delivery on calendar.
Per-plant edge inference rig: $103.3K – $142.8K. Low = current May 2026 estimate; high = supply-chain hardened ceiling absorbing memory shortages, GPU spot pricing, tariff and lead-time premiums.
All system-level software is OSS or free-from-vendor; license-bearing items isolated as managed subscriptions.
11 FTE blended (in-house + loaned + contractor) over 6 months at Philadelphia / Delaware Valley market rates (Q1 2026), fully loaded — $1.25M total.
Salary.com, Built In, ZipRecruiter, ERI, Glassdoor (Philadelphia MSA, Q1 2026). Contractor rates reflect $150–$300/hr senior AI / OT specialist market.
ADVANCE alignment memo on week-1 workstream — scope is complementary, non-duplicative with Group Digital & AI.