Tag Archives: Shell

Nigeria: Oil Spill Investigations ‘A Fiasco’ in the Niger Delta

The investigation process into oil spills in the Niger Delta has been challenged today by Amnesty International and the Centre for Environment, Human Rights and Development (CEHRD), as inconsistencies in Shell’s claims about sabotage were revealed.

Experts have examined evidence from the latest oil spill from Shell’s poorly maintained pipelines in the Bodo creek area and confirmed that it strongly indicates that the leak is due to corrosion of the pipeline. However, Shell appears to be ignoring the evidence of corrosion.

“The investigation process into oil spills in the Niger Delta is a fiasco. There is more investment in public relations messaging than in facing up to the fact that much of the oil infrastructure is old, poorly maintained and prone to leaks – some of them devastating in terms of their human rights impact,” said Audrey Gaughran, Director of Global Issues at Amnesty International.

Amnesty International and CEHRD asked US company, Accufacts, which has many years experience in examining oil infrastructure, to examine photographs of the pipe at the leak point. They stated: “This is apparently due to external corrosion. Notice the layered loss of metal on the outside of the pipe around the “stick” from pipe wall loss (thinning) due to external corrosion. It is a very familiar pattern that we have seen many times on other pipelines.”

“Shell have said locally that the spill looks like sabotage, and they completely ignore the evidence of corrosion. This has generated a lot of confusion and some anger in the community,” said Stevyn Obodoekwe, Director of Programmes at CEHRD. “We have seen the pipe and brought an expert to look at it, and it seems pretty clear it is corroded.”

Shell will now remove the affected length of pipe to a Shell facility where, according to the company, tests will be done.

Shell’s pipelines are old and many have not been properly maintained or replaced, with local people and NGOs reporting that the pipes in the Bodo area have not been replaced since 1958. When Amnesty International asked Shell to confirm the age and status of the pipes the company did not respond.

One year ago, the United Nations Environment Programme (UNEP) issued a major report on the effects of oil pollution in the Ogoniland region of the Niger Delta. Little has changed, as this latest oil spill at Bodo demonstrates. Among its findings, UNEP confirmed that Nigerian regulatory agencies “are at the mercy of oil companies when it comes to conducting site inspections”. UNEP also found that Shell had failed to adhere to its own standards in relation to maintaining its infrastructure.

Thousands of oil spills have occurred in the Niger Delta since the oil industry began operations in the late 1950s. Corrosion of the pipes and equipment failure were responsible for the majority of spills. In recent years sabotage, vandalism and theft of oil have also contributed to pollution. However, corrosion and equipment failure remain very serious problems which have never been addressed.

Oil companies are responsible for ensuring that, as far as possible, their equipment is not vulnerable to tampering. However, Shell has not responded to request to for information on any measures it has taken to prevent sabotage and vandalism.

On 3 August Amnesty International and CEHRD published a report on an oil investigation at Bodo in June/July 2012. The report focuses on the lack of transparency in the process and the failure of shell to disclose any information on the condition or age of its pipes.

Since 2011 Shell has posted oil spill investigation data on its website. This move was welcomed by Amnesty International and CEHRD. However, as research by both organizations has made clear, the process on the ground remains highly problematic, and there is a lack of independence and transparency in the investigations themselves.

SOURCE: http://allafrica.com/stories/201208030327.html

Texas refinery unit shut down for ‘several months’ as it investigates major corrosion problem

Motiva Enterprises LLC has announced it is preparing to keep its new crude oil unit shut for “several months” as it investigates major corrosion problems that have crippled the country’s biggest refinery weeks after a massive expansion.

In the first public acknowledgment of a potentially long-term outage at the Port Arthur, Texas, plant, Motiva co-owner Royal Dutch Shell Plc confirmed the 325,000-barrel-per- day (bpd) unit was shut due to “corrosion problems,” as posted on integritythatworks.com earlier this week.

“The outage of the new crude unit may continue for several months, while the causes of the issue are established and rectified,” Shell said in a statement late Wednesday.

Sources said earlier this week the outage, initially estimated at two to five months, could now extend to a year.

Shell, which runs the Motiva joint venture with state oil firm Saudi Aramco, said all secondary units built as part of the five-year, $10 billion project were fully operational, although some were running at reduced throughput.

Separately, sources familiar with operations said one of the new units — a catalytic feed hydrotreater that removes sulfur from feedstock going to the refinery’s gasoline-producing fluidic catalytic cracking unit — was being shut down this week because of a lack of feedstock from the idled crude unit.

The sources also said Motiva was shutting an older catalytic reformer, which creates gasoline additives.

Motiva officials were not immediately available to comment on details of the secondary unit operations.

In the statement, Shell said the refinery’s original 275,000 bpd complex was operating “as per plan.”

Motiva’s Port Arthur refinery is not shutting the refinery’s FCC, but will emphasize production of diesel, which is yielding higher returns for U.S. refiners as an export, the sources said.

The new crude distillation unit, which began production in April and was shut following a June 9 fire, may be idle for up to a year to repair extensive corrosion found in the unit.

SOURCE: http://in.reuters.com/article/2012/06/21/refinery-operations-motiva-portarthur-idINL1E8HL2TI20120621

Pittsburgh-area site is chosen for major refinery

Shell Oil Co. has chosen a site near Pittsburgh for a major, multi-billion-dollar petrochemical refinery that could create thousands of construction jobs and provide a huge economic boost to the region.

Dan Carlson, Shell’s General Manager of New Business Development, said Thursday that the company signed a land option agreement with Horsehead Corp. to evaluate a site near Monaca, about 35 miles northwest of Pittsburgh.

The so-called ethane cracking, or cracker, plant would convert ethane from bountiful Marcellus Shale natural gas liquids into more profitable chemicals such as ethylene, which are then used to produce everything from plastics to tires to antifreeze.

The plants are called crackers because they use heat and other processes to break the ethane molecules into smaller chemical components. A cracker plant looks very similar to a gasoline refinery, with miles of pipes and large storage tanks. The final complex could cover several hundred acres.

Ohio, West Virginia and Pennsylvania had all sought the plant and offered Shell major tax incentives. Monaca is about 15 miles from both the Ohio and West Virginia borders, so workers in all three states are likely to benefit.

Shell has said that it could spend several billion dollars to build the plant, and that the complex would attract a wide range of industry and suppliers to nearby locations. But actual construction is still years away. The company said the next steps are environmental and design studies and further economic analysis, then permits.

One lifelong resident of the Pennsylvania township almost broke down on hearing the news.

“Oh my God. It makes me want to cry. That’s just the best news,” said Christie Floyd-Gabel, Potter Township’s secretary.

It’s also an unexpected turn for Horsehead’s zinc factory on the banks of the Ohio River, which is currently operating. In September the company announced plans to shut the factory by 2013 and relocate to North Carolina, along with most of its 600 workers.

“That was a major loss,” Floyd-Gabel said of Horsehead’s plans to depart, adding that’s it’s amazing that another major corporation may come in to replace Horsehead.

Ali Alavi, a Horsehead spokesman, said the company would have to vacate the over 300-acre site by April 30, 2014, under the terms of the option agreement with Shell.

Shell said the Horsehead site had the mix of resource and transportation attributes “to accommodate facilities for a world scale petrochemical complex and potential future expansions.”

The American Chemistry Council, in a report last year, estimated the new petrochemical complex could attract up to $16 billion in private investment. Shell estimated the core plant could employ several hundred people and create up to 10,000 construction jobs.

Gov. Tom Corbett said at a press conference that the plant could lead to the “renewal of a significant manufacturing base in southwestern Pennsylvania,” but cautioned that the announcement is “the first pitch in a nine-inning game.”

If the plant is built, Shell would be able to supply it partly with gas from its own wells, giving it more control over supply and costs. The company paid $4.7 billion in 2010 for drilling rights to about 650,000 acres in the region.

That also means that Shell could benefit even from the low wholesale prices that have worried some gas drillers, since a cracker plant’s raw material costs would be lower.

Labor leaders welcomed the announcement.

Frank Snyder, secretary-treasurer for the Pennsylvania AFL/CIO, said it represented “some of the most positive economic news for the working families of western Pennsylvania in over a generation.”

“Indeed, all of Pennsylvania can have hope this spring in the anticipated partnership between a world class workforce and a world class business,” said Snyder.

Shell’s choice may also represent an indication of just how strongly the industry feels about the vast gas reserves in nearby underground shale rock formations, given the multi-billion dollar commitments it has made. Carlson told The Associated Press that any plant must be economically competitive with existing cracker plants in Louisiana and Texas, and even with international plants.

The Marcellus Shale, which lies thousands of feet underground, has attracted a rush of major oil companies, who have drilled almost 5,000 new wells in the last five years. The Marcellus covers large parts of Pennsylvania, New York, Ohio and West Virginia, and drillers have also started to tap the adjacent, deeper Utica Shale formation.

Ohio and West Virginia officials had made all-out efforts to attract the plant. Last year West Virginia Commerce Secretary Keith Burdette said, “We intend to compete with the last breath in our body to attract one or more crackers,” and both West Virginia’s and Ohio’s governor flew to Houston to meet with Shell officials.

West Virginia offered to slash property tax rates for 25 years in exchange for at least $2 billion worth of investment. Pennsylvania offered 15 years of tax breaks and Ohio also reportedly courted Shell with major incentives.

Corbett said he can’t disclose the full details of the tax breaks Shell has been offered because of a confidentiality agreement, and because negotiations are continuing.

George Jugovic, president of the environmental group PennFuture, said it’s still researching the possible impacts of a cracker plant.

Several other companies are also reportedly considering building similar petrochemical plants in the region.

SOURCE: http://www.philly.com/philly/business/20120315_ap_pittsburghareasiteischosenformajorrefinery.html

Safety scare for North Sea oil rigs

Government safety inspectors have blasted oil companies for failing to deal with serious corrosion on North Sea rigs that could put lives in danger and lead to a disaster.

On one rig corroded pipes led to a “significant quantity” of gas leaking and it was “fortunate” there was no explosion.The revelations are in reports from the Health and Safety Executive (HSE), which launched an inspection program last year over concerns about oil platforms and pipelines which are being used beyond their expected lifespan.

The documents obtained through Freedom of Information by an oilworkers’ union reveal the HSE has issued improvement notices to rig operators after its inspectors found evidence of corrosion that could have resulted in severe damage in at least three installations, two off the Scottish coastline.

Industry representatives said the inspection programme had shown that most rigs had effective anti-corrosion programmes in place.

But the Scottish National Party’s Westminster energy spokesman said the latest reports strengthened the argument for the Scottish Parliament to be given new powers to regulate the offshore industry. The documents have emerged following the leakage of more than 200 tonnes of oil from a pipeline from Shell’s Gannet Alpha, 112 miles offshore from Aberdeen.

The most serious incident revealed by the FoI requests happened in October last year on the Brae Alpha rig, operated by the oil company Marathon around 100 miles north-east of Aberdeen.

According to an official Improvement Notice issued by the HSE, a gas leak on the installation, which has around 100 staff, was only discovered after a worker smelled gas.The subsequent investigation by HSE staff found that “the incident featured an uncontrolled leak of flammable hydrocarbon gas in significant quantity from a pipe near the east side” of the platform. The incident had the potential to cause fire and explosion.”

The HSE pinpointed the source as combined and progressive internal and external corrosion affecting the pipe work. It added: “The issues underlying this show that you have failed adequately to detect the extent and severity of the corrosion.”

It also pointed out no gas detection coverage was available in the area of escape.

The HSE ordered Marathon to review its systems for inspecting for corrosion by March this year.

Another serious example of corrosion involved the Balmoral Platform, operated by Premier Oil, 135 miles north- east of Aberdeen.

Jake Molloy, regional organiser of the RMT union offshore energy branch, said oil companies were showing: “a blatant disregard for workers health and safety.”

Of the Brae Alpha incident, he said: “We find it astonishing that this significant gas leak was only discovered by a worker actually smelling the gas. Well done to the worker and thank God he wasn’t suffering from a cold. But think about it – no gas detection system.