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 spearheading 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.”
MATCOR is a full service provider of customized cathodic protection systems to the oil & gas, power, water/wastewater and other infrastructures industries. Cathodic Protection is a technique used to control the corrosion of a metal surface by making it the cathode of an electrochemical cell. MATCOR has an array of proprietary cathodic protection products and systems combined with high-quality corrosion engineering services, and installation and maintenance services.
In business for over 40 years, MATCOR is considered the technology leader in cathodic protection and corrosion engineering. MATCOR is headquartered in Chalfont, PA, has a major service operation in Houston, TX, provides turnkey services throughout the United States, and has a growing list of international distributors. MATCOR has been named to the Inc. 5,000 list of fastest growing companies in 2011, 2012 and 2013. Because of strong continued growth, MATCOR is seeking talented new team members to fill cathodic protection and corrosion engineering jobs.
MATCOR employees and culture are driven by three core principles. Whether a technician, engineer or manager, these principles guide us toward positive relationships with our clients and positive outcomes to every project we undertake. These core values are: We Respect Others, We Honor our Commitments and We Act in a Safe and Responsible Way.
“Our cathodic protection and corrosion engineering job openings, from technician to management positions, offer you the opportunity to grow with our team of seasoned cathodic protection experts and become part of a unique culture,” said Doug Fastuca, president of MATCOR, “As we are experiencing tremendous growth and request for our products and service offerings, this is an excellent time to join MATCOR. In addition to competitive benefits, you can become NACE certified and enjoy other advanced educational opportunities.”
Our ideal job candidates will possess these values and hold a positive attitude. This is a rapidly growing company with many new career opportunities. Your cathodic protection, corrosion engineering and management job opportunity is here, today!
Production from the Marcellus Shale natural gas reserves is expected to exceed 13 billion cubic feet per day this December, nearly seven times the 2 billion cubic feet per day it produced during the same period in 2010, according to a recent report.
The report on Marcellus Shale production data, by the U.S. Energy Information Administration, said the figure would equal about 18 percent of total U.S. natural gas production during the month.
One of the Marcellus Shale companies that’s taking advantage of the natural gas boom is Cabot Oil & Gas Co., based in Houston, which claimed 15 of the 20 highest-producing natural-gas wells in the area during the first half of the year.
According to Dan O. Dinges, Cabot’s chief executive officer, 10 wells from a single well pad in Auburn Township produced enough natural gas in 30 days to meet the average monthly demand of the entire city of Philadelphia.
Cabot plans to increase its Marcellus Shale drill rigs from six to seven in 2013, with each rig capable of drilling 20 wells during the course of the year.
The sharp rise in natural gas reserves production hints at the growing need for Marcellus Shale companies to incorporate pipeline corrosion control equipment like cathodic protection rectifiers into their gas delivery infrastructure, according to Chris Sheldon, who works as utilities practice lead for MATCOR, a Pennsylvania-based cathodic protection company.
“Marcellus Shale companies are experiencing a tremendous upswing in natural gas production and are building new drill rigs and digging new wells to take advantage of the vast natural resource at their feet,” Sheldon said. “That means a lot of new pipes are going to be laid. And more pipes means more opportunities for corrosion.”
“At MATCOR, we’re here to help Marcellus Shale companies, as well as other pipeline companies and natural gas producers, with a full line of advanced cathodic protection equipment, systems and services designed to help them meet their corrosion control needs.”
NACE International has begun an expansive global study that will examine the cathodic protection and corrosion costs across a variety of industries. The effort will provide research on controlling corrosion-related costs, which will help improve corrosion and cathodic protection strategies.
NACE International, an international corrosion and corrosion engineering society based in Houston, Texas, has announced the launch of a two-year global cathodic protection and corrosion costs study that will examine the financial and societal effects of corrosion on a variety of industries and provide data about methods for controlling costs related to corrosion.
Industries covered by the corrosion costs study include manufacturing, infrastructure, transportation, utilities and government. The study will integrate research from partners in international and regional industry and academia and will be managed by Elaine Bowman, a longtime corrosion industry advocate and former president of NACE International.
“Corrosion is an inevitable, but controllable process which can result in destructive, even catastrophic incidents when not properly prevented and managed,” Bowman said in a press release. “Costs associated with corrosion control include direct expenses like repair and replacement of assets. But there are additional indirect costs like production lost due to closure for repairs or the environmental and physical impact of corrosion-related failures.”
The cathodic protection and corrosion costs study will help asset owners identity ways to save up to 30 percent on costs related to controlling corrosion, Bowman said.
“The NACE corrosion costs study will likely provide invaluable data for us and our customers going forward,” said Ted Huck, who works as the practice lead for plants and facilities with MATCOR, a cathodic protection company that specializes in providing customized corrosion engineering and cathodic protection systems.
“Essential information and comprehensive scientific modeling about corrosion will only improve our understanding of the impact of corrosion on the oil and gas and other industries we serve,” Huck said. “And that means even better corrosion and cathodic protection strategies and tactics for our customers.”
An earlier corrosion costs study in 2001 estimated that the annual direct costs of corrosion in the U.S. was $276 billion. The study, funded by the U.S. Congress with Federal Highway Administration oversight and NACE International support, resulted in the development of a Corrosion Policy and Oversight (CPO) office within the Department of Defense.
“Quantifying the costs of corrosion is an important effort in educating asset owners to the value of investing in asset life extension technologies such as cathodic protection to provide the lowest total cost of ownership,” said Huck. “Corrosion is a hidden, and often avoidable, cost to asset owners and something that can be mitigated with the appropriate use of current, available technologies.”
The CPO demonstrated a return as high as 40-to-1 on investments for corrosion control programs implemented by the Department of Defense. The 2001 study also resulted in congressional support for the world’s first undergraduate degree in corrosion engineering.
Celebrating the completion of a new manufacturing and headquarters building by hosting an Open House.
MATCOR, Inc. the trusted full-service provider of proprietary cathodic protection products, systems, and corrosion engineering solutions celebrated the completion of its state-of-the-art manufacturing plant and headquarters by hosting an Open House on May 29, 2013. The festivities were held at the company’s new corporate headquarters in Chalfont, PA.
The new 47,000 square foot building represents MATCOR’s continued growth and success. With this expansion MATCOR continues to grow its manufacturing capabilities in PA to better meet client’s needs, while improving the facilities and the work environment for its colleagues, and by creating jobs and community development within MATCOR’s local geography.
The official ribbon-cutting was conducted by Pennsylvania Lieutenant Governor James Cawley, a former Commissioner of Bucks County. “We are honored to have Lieutenant Governor Cawley here to celebrate this important company milestone”, said Jeff Stello, President & CEO. “His participation is extremely relevant because the Lieutenant Governor helped guide the Marcellus Shale Commission for safe and reliable development of shale gas in the Commonwealth”, added Stello. MATCOR is deeply involved in the Marcellus Shale by providing its expertise and Pennsylvania-manufactured corrosion-prevention solutions to the oil and gas industry operating throughout Pennsylvania.
For the 100 plus guests, MATCOR provided food and refreshments, tours of the manufacturing facilities, and an opportunity for customers and vendors to meet employees from all departments and across the MATCOR team. Visitors commented on the welcoming and professional feel of the new office space. During the plant tours, visitors were impressed by the manufacturing operation, MATCOR’s focus on quality and safety, and the innovative automated manufacturing processes.
Attendees included customers from throughout the region, along with notable public officials from the Commonwealth, local municipalities and counties, and other regional businesses leaders.
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.”
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.
The Institute will support growth and quality of certification for the corrosion control field, improve the business conditions of the industry, and promote public safety, protect the environment and reduce the economic impact of corrosion.
To comply with IRS rules for certification bodies in the U.S., NACE International has moved its world renowned certification programs to the new NACE International Institute. The Institute’s mission is to support growth and quality of certification for the corrosion control field, to improve the business conditions of the industry, and to promote public safety, protect the environment and reduce the economic impact of corrosion.
“The purpose of the Institute is to operate broadly for the benefit, protection, and preservation of the corrosion engineering and science industry,” said Chris Fowler, President of the NACE International Institute. “This is a unique opportunity to build the profile of the industry and its workforce and also build the job market for corrosion control professionals.”
The NACE International Institute was formed in 2012 to maintain NACE compliance with existing and recently changed U.S. tax laws for not-for-profit organizations that have certification programs. The development of the Institute will also lead NACE’s certification programs toward compliance with the ISO standard for certification bodies (ISO17204).
From the start, the NACE International Institute will focus on meeting industry needs for workforce certification programs, pursuing global consistency of certification requirements, raising industry and public awareness of the purpose and benefits of certification programs, and supporting employment of certified corrosion control professionals. Over time, the Institute will continue to draw more activities into its operations to serve stakeholders based on changing industry needs.
In mid-2013 NACE certification programs will move to the new NACE Institute website at http://www.naceinstitute.org and will maintain the same functionality currently available online at http://www.nace.org, including certification application and renewal, and a tool to search for certification holders worldwide.
“To me, it is always exciting to boost the corrosion control profession for NACE members,” said Fowler, “the growing industry focus on corrosion control knowledge and experience, and related industry certifications, is yet another step toward action that will lower the cost of corrosion for the public at large.”
The members of the NACE International Institute’s Board of Directors are:
MATCOR, Inc. the trusted full-service provider of proprietary cathodic protection products, systems, and corrosion engineering solutions proudly announces it will be an exhibitor at the Global Petroleum Show (GPS), Calgary AB, June 12 – 14 2012.
At the show, MATCOR will have key personnel situated at the PA Pavilion introducing MATCOR’s innovative range of Cathodic Protection Products and Services including “Durammo” MATCOR’s Deep Anode System. Learn more here.
About the Global Petroleum Show
Global Petroleum Show (GPS), one of the world’s largest energy exhibitions, will be taking place June 12 -14 at Calgary’s Stampede Park. Since 1968, the biennial event has united the world’s most prominent energy leaders. This year, GPS will welcome over 60,000 registered attendees from 95 different countries and will feature more than 2,000 exhibiting companies showcasing the latest in emerging technology.
Expanding to over 700,000 square feet, GPS 2012 will see delegations, presentations and exhibits from Bahrain, China, Colombia, France, Germany, Indonesia, Japan, Korea, Kuwait, Mexico, Nigeria, Norway, Oman, Peru, Poland, Qatar, Russia, Saudi Arabia, UAE, United Kingdom and the USA.
According to MATCOR’s Nick Judd, Houston-based corrosion engineer, “The company used to pick up less than 200 miles a year in pipeline integrity management (PIM) projects. Today, we are already doing more PIM; we’re growing to serve much more, and it’s no stretch to say we’ve got the capabilities.”
In deploying a broader range of experience-based capabilities, MATCOR knows that Pipeline Integrity Management is a crucial tool for operators and asset managers who have to do more in monitoring pipeline corrosion and assuring pipeline integrity. Judd maintains that MATCOR is present and accounted for in all the ways that reinforce the corporate theme, “Integrity that Works.”
“Today, everyone we hire is NACE-certified, starting with entry Level 1 and going through succeeding Levels 2 and 3,” he notes. “Our PIM professionals have to be Level 1 at least. We also staff with a mixture of graduate engineers in various disciplines and field-experienced personnel. Then we combine the two so we can go the extra distance for every PIM customer. Both Judd and MATCOR Executive Vice President Glenn Schreffler agree that the company’s personnel have to have both the “book learning” and the field experience to deliver effective PIM services.
“People who do not know MATCOR don’t yet recognize how highly qualified we all are in programmed corrosion prevention, and in reporting on the results,” says Judd.
The foundation is always NACE certification. Why? NACE has known for many years that there’s a need for supporting and reinforcing the integrity in corrosion prevention. NACE standards meet the needs of all segments of the infrastructure industry; they are written and approved by instructors and professors, government officials and regulatory experts, and especially by industry professionals…including some MATCOR experts. Judd maintains, “There need to be levels of testable knowledge leading to certification in corrosion, cathodic protection, and coatings and linings – this is part and parcel of our approach to PIM. So we make certain today that our technicians are NACE-certified by corporate mandate. Our internal OQ disciplines are just as rigorous.” (Judd is one of MATCOR’s Operator Qualification specialists as well.)
Integrity management of pipelines is an organized, integrated and comprehensive process that counters threats to pipeline safety. But as is now plain, PIM is about people. To be successful, MATCOR people not only meet widely recognized PIM standards but are able to apply them meticulously. “In PIM assignments, the crews I send out may have to meet weather challenges, or equipment difficulties – but never problems of applied knowledge or data acquisition or reporting.”
Effective PIM service delivery encompasses every one of the knowledge/data/reporting demands. “We carefully and successfully completed one ECDA (External Corrosion Detection Analysis) project for a very short segment of a customer’s pipelines, notes Judd. “We dotted every i, we crossed every t – we met and exceeded the expectations of the customer’s Corrosion Integrity Manager.”
“Even so, we were still pretty gratified when we got a callback from this customer, an opportunity to do more work, because our job performance was so good. Our new, larger project involves ICDA, (internal corrosion direct assessment), which also means extra computer modeling. I went over the PIM game plan with this customer and noted that we were going to need much more data to ensure success on this newer, large-scale project.”
“The customer agreed to help meet these requirements. And since he knows our data is superbly accurate, he is using the information we collect and analyze to revamp the alignment sheets on a 35-pipeline system.”
“This customer manager also feels that the MATCOR people working on this project understand the delicate differences among some of ‘his’ transportation system elements, which include gap and transmission mains, in-plant systems and distribution lines.”
“And for him – just as we’re doing for everyone now – MATCOR goes the extra distance, ensuring that we turn the data into analyses and report those within 48 hours of receiving the data.”
Whether MATCOR is conducting ECDAs, ICDAs, root cause analyses or ongoing maintenance and repair supervision, every element is documented and reported. So for MATCOR in PIM, there is an additional factor at work. “US Department of Transportation regulators are frequently on our sites,” says Judd, “closely monitoring how we actually conduct these processes and programs. We have an in-depth understanding of their reporting demands and we can use this savvy to help operators pass regulatory scrutiny with flying colors. It is one more level of reassurance – again supported by MATCOR’s multiple levels of experience and dedication to going the extra mile.”
For Judd, none of this is a stretch. His obligation to integrity reinforces the company’s. “Whenever I leave a meeting, I always want to be certain I have said the same things today that I said last year, and will continue to say next year, in terms of commitments made and delivered upon.”
“When MATCOR says, ‘We will do it,’ it’ll get done. Period.”
Team members of MATCOR have been involved in several online discussions (LinkedIn) about the pros and cons of Zinc Ribbon for use in AC Mitigation. So we thought we would share our expertise in this subject on our blog.
Below are 4 reasons why we believe Copper (and our AC Mitigation product, “The Mitigator“) is a superior solution to Zinc Ribbon.
Formation of passive films on the surface of the zinc can cause a significant electropositive shift in the zinc potential over a period of time; this generally occurs over a period of days or weeks. The general rule of thumb is that the concentration of chlorides and sulfates must be measurably greater than the sum of the concentrations of bicarbonates, carbonates, nitrates and phosphates; otherwise with time the zinc corrosion potential will shift electropositive. Plattline’s Web site notes that zinc ribbon is “generally used with gypsum backfill”; however, too often for AC Mitigation applications, no consideration is given to placing the zinc ribbon in a specially prepared backfill (this should be general practice).
Zinc faces high consumption/corrosion rates in the presence of AC. A.W. Peabody has noted that AC can “create an especially high corrosion rate with buried aluminum, magnesium and zinc”. Testing of zinc electrodes at an AC Current density of 155 A/m2 found a 15-20 fold increase in the consumption rate of zinc. R.A. Gummow, a corrosion engineer and a NACE International accredited Corrosion Specialist, notes that “accelerated corrosion of zinc ribbon AC mitigation facilities must be expected and needs to be accounted for in the cathodic protection design despite the lack of information on the magnitude of the accelerating effect”.
The effect on existing impressed current CP systems: the use of zinc anodes directly connected to the pipeline for AC mitigation can interfere with existing impressed current CP systems in a way that is both difficult to model and to predict. In some cases, the zinc anodes can become an additional load, particularly if the zinc is not located in a prepared backfill and has shifted to a more electropositive potential. In other cases, the zinc anode may be providing and/or supplementing galvanic current to the CP system in which case it will be consumed over time – note that the presence of AC often increases significantly the consumption rate. This could result in premature consumption of the zinc ribbon as an AC Mitigation system.
The effect of the zinc ribbon on potential surveys when directly connected to the pipeline can be erratic and difficult to interpret, rendering these surveys inconclusive or invalid. Given the emphasis on integrity management and the additional risks posed by AC Induced Corrosion in collocated right-of-way (ROW) corridors, the negative impact that the zinc ribbon might have on survey data could make CIS surveys invalid and increase the need for and frequency of Inline Inspections (ILI).
In addition to these 4 key reasons, MATCOR’s ‘The Mitigator‘ is the pipeline industry’s first engineered AC Mitigation grounded system, with greater ease of installation and lower overall cost.