Category Archives: Oil

Pipeline Cathodic Protection Design for New Transmission Stations

Technological advances in horizontal drilling and fracking have changed the oil and gas production landscape that propels the US Pipeline industry. This combined with an increasing demand for natural gas and the promise of larger export markets for both LNG and US crude oil have led to a surge in new pipeline construction. As a result, corrosion prevention, including pipeline cathodic protection design and engineering expertise is critical as the industry adapts to a changing production landscape and new distribution challenges.

Cathodic Protection Engineering Capabilities

MATCOR has been heavily involved in several key engineering projects including pipeline cathodic protection design for new transmission stations. Whether these are compressor stations for gas pipelines or pump stations for liquids pipelines, pipeline owners appreciate MATCOR’s innovative application of linear anodes when designing new construction stations.

Pipeline Cathodic Protection Design with Linear Anodes

The advantages of using linear anodes in a new pipeline station environment include:

  • pipeline cathodic protection design for new transmission stationInstallation in the same trench as the buried piping during initial construction greatly reduces installation costs
  • Close coupling of the anode to the piping greatly minimizes the current losses of the CP system to the station’s grounding system
  • Utilizes a low anode gradient / low current output anode system that minimizes interference concerns with other structures and with foreign pipelines outside the station area
  • Provides exceptionally long anode life using MMO (mixed metal oxide) anodes operating at mA/ft current output.

MATCOR has successfully pioneered the use of linear anodes in plant environments for two decades. With the recent surge of pipeline projects, the use of linear anodes in stations has gained significant traction in the market. MATCOR design engineers and field technical personnel are uniquely qualified to perform engineering, pipeline cathodic protection design, field installation support, commissioning and testing services for these critical infrastructure projects.

MATCOR also offers a full suite of cathodic protection and AC mitigation design services for transmission pipeline and oil and gas production pipeline gathering systems.


Have questions or need a quote for engineering and design or materials for your pipeline cathodic protection system? Contact us at the link below.

CONTACT A CORROSION EXPERT

Pipeline Petroleum Transport Investment May Predict Growing Cathodic Protection Needs

If Warren Buffet’s investment strategy is any indication, pipeline efficiency is going to start playing a bigger role in moving crude oil and natural gas in the United States.

The Berkshire Hathaway luminary is pipeline-efficiency-cathodic-protectionspearheading a swap of about $1.4 billion in shares of Phillips 66 for full ownership of the energy company’s pipeline petroleum transport services business. The business unit’s focus is polymer-based additives that are used to move crude oil and natural gas through pipelines more efficiently by reducing drag.

The shift in Berkshire’s investment strategy comes amid a boom in U.S. crude oil and natural gas production. Since many liquids pipelines in the United States are operating at capacity, producers can use the pipeline petroleum transport additive to quickly increase capacity without immediately growing pipeline infrastructure.

Although future pipeline projects may be in the works to meet the sharp increase in demand, the process of gaining approval for new pipeline projects can be slowed by permitting.

A greater reliance on existing pipelines for transporting liquids means that producers and pipeline owners need to pay even more attention to cathodic protection management, according to Kevin Groll, project management director for MATCOR, a Pennsylvania-based company that specializes in cathodic protection products and services.

“Any time you have pipeline you have to protect it from corrosion,” Groll said. “And that’s especially true when you increase the value of a pipeline by increasing its capacity. If that pipeline were to develop a corrosion problem you’d be facing a situation where your profitability could suffer significantly.”

“With pipeline owners using additives to push greater volumes of liquids it becomes imperative to use cathodic protection products such as impressed current anodes and cathodic protection rectifiers to protect the increased capacity and profitability of the pipeline infrastructure.”

Further Reading

Berkshire Swaps $1.4 Billion in Phillips 66 Stock in Deal,” Bloomberg, December 31, 2013.

Bakken Shale Oil and Gas Companies Pave Way for Growing Cathodic Protection Demand

More than $22 billion will be spent to build over 23,000 miles of pipeline in North America between 2014 and 2020, according to a recently updated pipeline construction report.

The third-quarter 2013 update of the North American Onshore Pipeline Database Service, by Douglas-Westwood, an energy research group based in Faversham, England, also catalogued the planned construction of over 1,000 miles of pipelines transporting Permian crude oil from the Bakken Shale region.

The Bakken pipelines will enable Bakken Shale oil and gas companies to meet the logistical challenges of transporting crude oil from the remote shale region, which encompasses parts of the United States, including North Dakota and Montana, and Canada.

Because of North Dakota’s short construction season, hard terrain, and distance from the Gulf Coast, rail transportation and natural gas flaring by Bakken Shale oil and gas companies has boomed in recent years. However, the report estimates that the planned Bakken pipelines will further lower the current Bakken discount compared to WTI, which has hovered around $5 for most of 2013, and diminish the cost competitiveness of rail.

“While the capital cost of pipeline installation can sometimes be difficult to justify when compared to rail, a pipeline cathodic protection system can help companies control associated maintenance and repair costs,” said Jeff Didas, who works as a pipelines practice lead for MATCOR, a Pennsylvania-based cathodic protection management company.

“When the potentially devastating effects of corrosion are managed to the point that corrosion becomes a minor factor, pipelines transform into a far more cost effective option over the 30-plus year commitments typically required in pipeline shipping contracts,” Didas said. “A cathodic protection strategy for pipelines is vital for Bakken Shale oil and gas companies and others who are investing in takeaway infrastructures from shale plays in North America.”

One such area, the Utica Shale, has lagged in production to date compared to other major shale plays but is expected to spike soon, due in part to pending developments in pipeline construction and capacity.

Further Reading

Shale-Driven Pipeline Expenditure to Hit $22B Before 2020,” Oil & Gas Financial Journal, December 12, 2013.

Enbridge – Work on pipeline to begin later this year in Michigan

A portion of a large-diameter interstate crude oil pipeline that runs through Oxford and Addison townships (Michigan) is due to be replaced later this year by Canadian-based energy distribution company, Enbridge Inc.

Enbridge, Inc. will begin work on Oxford and Addison’s portions of what is known as Line 6B at some point between June 1 and Dec. 31, according to Jack Manshum, a spokesman for the company.

“That’s the plan as of right now,” he said. “We’re in the process of developing the construction timeline.”

Line 6B is a 285-mile crude oil pipeline that begins in Indiana, crosses southeastern Michigan and ends in Sarnia, Ontario, Canada. It serves refineries in Michigan, Ohio and eastern Canada.

This year, Enbridge plans to replace approximately 50 miles of Line 6B with new 30-inch diameter pipeline (the same size as the existing one) from Ortonville to the St. Clair River in Marysville. The portion that runs through Oxford is approximately 6.5 miles in length, while Addison’s portion is approximately 6 miles long, according to Manshum.

This is part of a much larger construction project that spans approximately 210 miles across Michigan and Indiana.

The Michigan Public Service Commission approved Enbridge’s application for this phase of the pipeline project on Jan. 31

“We’ve haven’t formally announced the details yet as to when we’ll be in each county or in each area,” Manshum said. “We’re in the middle of outlining that entire plan. So, I don’t know exactly when we’ll be in Oakland County.”

The old underground pipeline will not be removed to make way for the new one. It will be left in place.

“It will run parallel and adjacent to the existing line that’s in place now using the same right-of-way,” Manshum said. “When the new line is tied in and activated, the old line will be deactivated.”

Deactivation will involve purging all the oil from the old line and cleaning it thoroughly to remove any remaining crude, he explained. The old line will then be “taken apart in small segments” and capped.

“Each chunk of that pipe will have caps on it and then it’s filled with nitrogen,” Manshum said. “We will monitor the pressure inside that line as long as the line exists. The reason you fill it with the nitrogen and you monitor the pressure is to help make sure it doesn’t have any internal corrosion.”

With regard to the line’s exterior, he said Enbridge will maintain the cathodic protection that’s already on it to ensure there’s no external corrosion either.

Enbridge can’t simply walk away from the old pipeline.

“It’s a federal requirement,” Manshum said. “You have to maintain it as if you were using it.”

Manshum explained that leaving the old pipeline in place is “pretty standard in the energy transportation industry.”

“To completely take that line out of service, then replace it with a new one” is not practical for Enbridge’s customers, which are oil refineries.

“(The pipeline) would be out of service for six to 12 months – there would be no product flowing through (it),” Manshum said. “(The refineries) don’t have enough storage capacity to go that long.”

Once the new line is up and running, why can’t Enbridge come back and remove the old one? “That’s more of an inconvenience for landowners,” Manshum said. “We’re already there during one construction season, digging up their property, creating the trench.”

If Enbridge returns for another construction season, the workers will “basically redig everything that we just put back into place the year prior.”

Manshum noted it would involve the “same amount of time and process” to remove the old pipeline as it did to install the new one.

“It’s much less disruptive to landowners for us to only be in there once, instead of having to come back,” he said.

SOURCE: http://www.clarkstonnews.com/Articles-News-i-2013-03-20-250883.113121-sub-Work-on-oil-line-to-begin-later-this-year.html

CEPA: Report Uncovers Diluted Bitumen Not Corrosive…

A report published on February 25 by a division of the UK-based Penspen engineering firm reveals diluted bitumen is no more corrosive than conventional crude.

Brenda Kenny, President and CEO, of the Canadian Energy Pipeline Association (CEPA), is pleased with the results of the report, which finally dispels the myth that industry critics have been spreading regarding the transportation of diluted bitumen.

“We have always known, based on scientific facts and our pipelines operational histories, that diluted bitumen is no more corrosive than conventional crude,” Kenny said. “Now, this manufactured myth can stop and Canadians can be further assured that our pipelines are safe regardless of the type of product they carry.”

According to CEPA, the report examined 40 studies addressing the behavior of diluted bitumen and conventional crude.  In these studies, which spanned over 40 years, the research concluded that diluted bitumen is no more corrosive when compared to conventional crude oil.

“It is important to have scientific evidence in front of Canadians, so they can make their own informed decisions, and not rely on misinformation”, Kenny said.

The report also showed that tests were carried out using internationally recognized standards, which found that small differences in some components of the product did not increase the chances of corrosion developing in oil transmission pipelines.  In addition, monitoring and preventative maintenance programs used by transmission pipeline operators on conventional crude oil pipelines were equally as effective on pipelines containing diluted bitumen.

The Canadian Energy Pipeline Association represents Canada’s transmission pipeline companies who operate approximately 110,000 kilometres of pipelines in Canada. In 2011, these energy highways moved approximately 1.2 billion barrels of liquid petroleum products and 5.3 trillion cubic feet of natural gas. CEPA members transport 97 per cent of Canada’s daily natural gas and onshore crude oil from producing regions to markets throughout North America.

SOURCE: http://www.cepa.com/new-report-reveals-diluted-bitumen-not-corrosive

US East Coast Refineries Coming Back to Life

The shutdown of several refineries serving the Northeast and the possibility they would not reopen threatened to boost New England’s already­ high gasoline prices by as much as 15 cents a gallon was a reality 1 year ago.

But an influx of cheaper crude oil extracted from shale rock formations in the United States has helped save most of those facilities and stabilized gas ­prices.

The influx of domestic crude, known as “tight oil,” has allowed East Coast refineries to decrease their reliance on more expensive foreign oil, increase profit margins, and regain their economic competitiveness, refinery operators say. They estimate the domestic crude cuts oil costs by a few dollars per barrel, which can have a huge impact on their bottom line.

“A savings of $1 per barrel across our entire refining system is worth several hundred million dollars of net income to Phillips 66,” said Dennis Nuss, spokesman for the Houston company operating the Bayway refinery in New Jersey.

In Philadelphia, domestic supplies have helped resurrect a facility that accounts for nearly one-fourth of East Coast refining capacity. It was put up for sale in 2011 and expected to close for good last summer as high oil prices and slackening demand made it barely profitable. Today, it is refining up to 330,000 barrels of oil a day, getting about 10 percent of its crude from the Bakken shale formation in North Dakota.

Phil Rinaldi, chief executive of Philadelphia Energy Solutions, the company that now operates the refinery, said the domestic supplies are pressuring foreign producers to keep their prices competitive.

“It allows us for the first time in a very long time to have some genuine diversity of supply,” he said. “The shale plays are game-changers.”

Learn how MATCOR provides Turnkey Cathodic Protection Solutions to these “game-changers.”

Last week, the average Massachusetts gas price was $3.68 a gallon, 12 cents higher than a year ago and up 25 cents in the last month alone, according to AAA Southern New England. If the refineries had stayed shuttered, however, prices would have been driven even higher, analysts believe.

SOURCE: http://www.boston.com/news/local/massachusetts/2013/02/18/shale-oil-reviving-east-coast-refineries/kBQmoNp4RNdXU4KREkv6sM/story.html

Genesis Energy to construct new infrastructure for Baton Rouge Refinery

US-based midstream company Genesis Energy has announced its plans to invest $125m to expand its existing infrastructure and construct new assets to connect into Exxon Mobil’s Baton Rouge Refinery in Louisiana.

The refinery with a capacity of 500,000 barrels per day (bpd) is one of the largest refinery complexes in North America.

The company will improve its existing terminal at Port Hudson, Louisiana and build new 29km long 20in diameter crude oil pipeline to connect the port to the Maryland Terminal and to the Anchorage Tank Farm.

The new pipeline is expected to have a capacity of about 350,000bpd and will also have the potential to access other local refineries representing about 140,000bpd.

Genesis Energy chief executive officer Grant Sims said the company is planning to expand its operations in the state of Louisiana.

“This project positions Genesis as an efficient conduit for crude oil supply and logistics in the region,” Sims added.

Genesis Energy also has plans to build a new crude oil unit train facility at the Baton Rouge Maryland Terminal.

The company is also planning to build a storage capacity of 200,000 barrels to complement its 216,000 barrels of existing tank capacity, apart from improving the truck station and barge dock.

Project work is scheduled to begin early in 2013, while upgrade, expansion, and completion work at the Port Hudson and new crude oil pipeline is expected to be completed by the end of 2013.

The Maryland Terminal completion is scheduled for the second quarter of 2014.

SOURCE: http://www.genesisenergy.com/assets/_Investors/Press_Releases/2013-02-04.pdf

Enbridge gets final OK to build massive pipeline across Michigan

The Michigan Public Service Commission has given Enbridge Energy the final OK to build the company’s massive oil pipeline across Michigan.

The commission’s order, which was issued on January 31, 2013 and is the last of three approvals the company had sought, and includes sections in Oakland, Macomb, Berrien, Cass, St. Joseph, Kalamazoo, Calhoun, Jackson, Ingham and St. Clair counties. The order allows the company to complete 110 miles of 36-inch diameter pipeline and 50 miles of 30-inch diameter pipeline.

“In approving the company’s application, the MPSC said the pipeline will serve a public need, is designed and routed in a reasonable manner, and meets or exceeds current safety and engineering standards. Within 60 days after completion of the construction of the project, the company will submit ‘as built’ maps to the Commission,” the commission said in a news release.

“This is the last proceeding Enbridge filed here at the commission related to line 6B,” according to Judy Palnau, a spokeswoman for the public service commission.

The company filed three applications with the MPSC for completion of different sections of the line that goes from Griffith, Ind., to Marysville, where the pipeline crosses into Ontario. The other applications were approved in 2011 and 2012.

SOURCE: http://www.freep.com/article/20130131/NEWS06/130131066/Enbridge-gets-final-OK-build-massive-pipeline-across-Michigan

Plains All American to buy terminals for $500M

HOUSTON (AP) — Plains All American Pipeline LP said Wednesday that it will buy rail terminals used to store and transfer crude oil for $500 million to help it prepare for increased U.S. oil production.

Plains operates oil pipelines across the country. By owning the terminals, it will also give the company more control over the oil it moves and allow it to avoid paying storage costs at rented terminals.

The Houston company is buying the terminals from U.S. Development Group, a privately held company that owns crude oil, petrochemical and ethanol terminal and storage centers across the U.S. and Canada.

The deal includes three terminals in the oil country of Texas, Colorado and North Dakota, one rail unloading terminal in Louisiana and another unloading terminal that’s being built near Bakersfield, Calif. Crude oil loading capacity from these terminals is expected to total about 250,000 barrels per day.

The Plains deal comes as U.S. oil production grows. Monthly crude production reached its highest level since 1998 in September, said the Energy Information Administration on Tuesday. Production is growing the fastest in Texas and North Dakota, where two of the acquired terminals are located.

The United States could overtake Saudi Arabia as the world’s biggest producer of crude oil by 2020, driven by high prices and new drilling methods, the International Energy Association said last month.

Read more: http://www.sfgate.com/business/energy/article/Plains-All-American-to-buy-terminals-for-500M-4096109.php

Canada to Build Oil Pipeline to Serve Asia

‘The U.S. market will not be large enough to accommodate all of Canada’s oil exports,’ said Natural Resources Minister Joe Oliver.

Canada is scrambling to build an expansive new oil pipeline network to reach new markets including Asia as its sole customer, the United States, hikes production, aiming to become the world’s top exporter.

Canada holds the third-largest oil reserves in the world but 98% of its oil exports and 100% of its natural gas shipments go the United States. This has made Canada the top energy supplier to its neighbor.

But that could soon end.

The United States is seeing a boom in shale gas and offshore oil production as it strives for energy independence, and the International Energy Agency recently said the U.S. could become the world’s top oil producer by 2020.

This week, Canada’s Natural Resources Minister Joe Oliver urged a fix: build more pipelines to move oil from landlocked Alberta province to both refineries in eastern Canada and the Pacific coast to fill tankers bound for Asia.

“The U.S. market will not be large enough to accommodate all of Canada’s oil exports,” Oliver said.

“By 2035, Canadian oil exports will be 4 million barrels per day, but total US imports will only be 3.4 million barrels per day. This highlights the need for Canada to access new markets,” Oliver added.

The federal government has put its weight behind several new pipeline projects, but the initiatives face stiff opposition from environmentalists and regional authorities.

“We’re already lacking outlets for the oil now being produced — existing pipelines are at capacity,” said Marco Navarro-Genie, a researcher at Calgary-based Frontier Centre for Public Policy.

“We’re forced to sell our oil at $22 below market value because we can’t get it to any market outside of North America,” Navarro-Genie said.

READ MORE: http://www.industryweek.com/energy-management/canada-build-oil-pipeline-serve-asia