Oil and Gas Innovation - January February 2014

OIL & GAS INNOVATION

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January - February 2014

The Trusted Insider Source

Exclusive: The Fort Hills Project Stocexpo Tank Storage Report Safety Management

EMERY HILL MEDIA ©

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January & February 2014

OIL & GAS INNOVATION CEO Matthew Patten

From the Editor:

Design & Logo Eric Eifler Technical Director & Website Todd Dobney tdobney@oilandgasinnovation.co.uk Managing Editor Simon Milliere smilliere@oilandgasinnovation.co.uk Publishing Director Edward Findlay edward@oilandgasinnovation.co.uk Business Development Manager Nicholas Parker nparker@oilandgasinnovation.co.uk Journalist Jennifer Habib jennifer@oilandgasinnovation.co.uk OIL & GAS INNOVATION

In today’s economic climate many would like to say that we are in a state of recession globally. However the Oil and Gas industry is experiencing more of a diversification rather than a decline. Yes of course the traditional bases of Europe, Russia & North America are experiencing economic turmoil. However they fossil fuel industry in these places continues to boom.

Yet this is not the real global story ion the Oil and Gas Industry. The real story is the emergence of new major players and the opening up of the sector to once state owned subsidies turned international oil players. Seven Sisters? Not anymore. Many argue that there is a new seven sisters emerging. Interestingly enough in 2013, it coincides with the emergence with major economic players such as the BRIC (Brasil, Russia, India & China) countries as power players on the international scene. What we are seeing now is the emergence of traditional state owned companies increasingly becoming international oil producers who compete with the tradition International Oil Companies. We are speaking about companies like Gazprom in Russia, Petrobras in Brasil, Statoil in Norway, Petronas in Malaysia, Saudi Aramco in Saudi Arabia & China National Petroleum Company (CNPC) acquiring overseas assets. This of course is in direct competition with the “old guard”, the likes of Chevron, Royal Dutch Shell, British Petroleum & Exxon Mobile among others.

CNPC is now currently ranked the third largest company in the world, in terms of revenue.

Its overseas portfolio includes many lucrative assets such as interest in places like Kazakhstan, New Zealand and has managed to secure work in Iran. Gazprom also carries out prospecting and exploration in foreign countries such as India, Algeria, Venezuela, Vietnam, Libya, Kazakhstan, Uzbekistan and Tajikistan. Petrobras global operations extends over 27 countries.

Big oil is inextricably linked to the progress both economically and politically to the new emerging powers this coming century. Europe and America must wake up to this new realization and of course act accordingly.

It is my pleasure to present to you the January February 2014 issue of Oil and Gas Innovation, and I hope you enjoy reading this issue. •

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Simon Milliere Managing Editor smilliere@oilandgasinnovation.co.uk EMERY HILL MEDIA ©

Emery Hill Media 37th Floor 1 Canada Square London E14 5AA Tel: +44 203 239 1581 © COPYRIGHT 2013 EMERY HILL MEDIA 3 • Oil and Gas Innovation

CONTENTS

Industry News 6 Latest News From All Around the World Oil and Gas Innovation’s latest news from around the world.

To see our latest up to date news please visit www.oilandgasinnovation.co.uk

Page 14

Cover Stories & Specials 10 The Fort Hills Project

Oil & Gas Innovation’s Jennifer Habib presents a comprehensive review of the Fort Hill Project in Alberta, highlighting the major players and what’s in store, near to medium term for the project.

Special Report - Tank Storage Innovation 14 Interview - ENDEGS Degassing specialist and pioneer in service for mobile combustion in Europe. With a specialty for being environmentally friendly in all phases.

18 Alternation For Use In Hazardous Environments

Alternators work generally on oil rigs and exploration platforms they are not classified with marine society classification such as DNV, ABS, Lloyds.

20 IT Solutions in the Liquid Bulk Industry

Today’s challenging economic climate results in an increased focus on efficiency in the liquid bulk industry. Liquid bulk terminals not only need to offer competing prices, they also need to be more agile to more quickly respond to ever-changing customer needs.

30 LIRA Technology

The LIRA Technology applies a low voltage (harmless to the cable) signal at several radio frequencies between any two metallic cores in the cable, and detects and locates any impedance irregularities in the cable insulation.

32 Industry Update: Morocco Transportation & Logistics 34 Workspace Modules & Accommodation Units

Dedicated to offering a flexible and personal service, Ferguson Group listens to the market and its customers, which has resulted in high quality, innovative products that improve the safety, comfort and efficiency of those working in the oil and gas sector.

Health Saftey & Enviroment 37 Safety Management

Behavioural Safety and Safety Culture are now familiar concepts to a wide range of organisations across a variety of sectors with the need to manage high-risk operations

Exploration and Production 24 Welding Alloys and Processes

Pipeline, Refining and Processing 40 Compression Technology

26 Renting Winches Rather Than Purchasing

42 Monitoring Internal Corrosion

28 Waste Management

Important Dates 46 Upcoming trade shows and conferences

Sandvik Wire and Heating Technology, explains as the upstream stage of the production of oil and gas becomes more challenging, particularly in deep water offshore environments.

HydrauRent has the advantage of being a one-stop shop for hydraulic solutions on a rental basis which enables the contractors and producers to use these solutions on temporary basis for possible emergencies and/or short term lease.

Space and resources on-board are by nature limited and the ports’ reception facilities add their own requirements for disposal and recycling of waste.

European certification, such as ATEX are critical in today’s factory enviroment.

An understanding of the specific mechanism, or mechanisms, of corrosion in oilfield pipeline systems is necessary in order to properly design and implement an appropriate mitigation strategy.

Selected do not miss shows to round up 2013 for the Oil and Gas professional.

4 • Oil and Gas Innovation

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Email: info@ferguson-me.com www.ferguson-group.com Ferguson Middle East LLC, Office 201, Al Hilal Building, Al Falah Street, PO Box 129354, Abu Dhabi, UAE. Tel: +971 2 493 0149.

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G/0104/13

NEWS

Canada Brasil Petrobras announces that in November, Petrobras’ total oil and natural gas output in Brazil was 2,342,000 barrels of oil equivalent per day (boed), up 1.2% from the 2,315,000 boed extracted a month earlier. Including the share operated by Petrobras for its partners, the rise in relation to October was 1.9%. Oil output exclusively from Petrobras’ fields in Brazil averaged 1,957,000 barrels per day (bpd), remaining within the range of October’s output of 1,960,000 bpd.

The new monthly and daily pre-salt output record of 339,100 bpd and 362,300 bpd, respectively, contributed to the stable oil output in November, in addition to the start-up of platform P-63 in the Campos Basin Papa-Terra field, which took place on November 11.

It is also important to highlight the start-up of new wells interconnected to the platforms P-26, in Marlim, and P-53, in Marlim Leste, as part of the complementary development of these fields, in Campos Basin. Also in November started the Extended Well Test (EWT) of Lula Extremo Sul, in Santos Basin pre-salt, through the FPSO Cidade de São Vicente.

Continuing the actions to increase operational efficiency in Campos Basin, the company held, during the month, scheduled maintenance stoppages in the platforms of Northeast Polo, FPSO Cidade de Anchieta and P-53.

Platform P-55 in Roncador field, on Campos Basin, with daily processing capacity up to 180,000 barrels of oil and up to 4 million cubic meters of natural gas, is in final preparations to start-up production. Moreover, platform P-58 anchoring activities are currently underway in the complex denominated Parque das Baleias (Whales Park), in Espírito Santo portion of the Campos Basin. The platform P-62 left today, December 30, to its final location in the Campos Basin. The platform P-61 will leave tomorrow, December 31, in the morning, also for its location in the Campos Basin, while the TAD (Tender Assisted Drilling) is currently navigating towards Brazilian waters. • Oil and Gas is Booming in Brazil

CALGARY, Alberta, December 27, 2013 /PRNewswire/ -- Madalena Energy Inc. (TSX-V: MVN) (the “Company” or “Madalena”) is pleased to announce the results of a multi-rate production test for the CAN.xr-2(h) horizontal well which is the Company’s first horizontal well to be drilled on its international assets: International Update: Neuquén Basin, Argentina Coiron Amargo Block (35% Working Interest) - Si erras Blancas Test Results and Drilling Update The CAN.xr-2(h) well was recently re-entered and drilled horizontally in the Sierras Blancas light oil reservoir to a total measured depth of 3,751 meters with a horizontal lateral section of approximately 530 meters in length. This horizontal well was subsequently cased and completed with a 3.5” slotted liner and a multi-rate production test was carried out through temporary production facilities. Throughout the multi-rate production test, the CAN.xr-2(h) well flowed without artificial lift equipment and was tested for approximately 42 hours at various choke settings ranging from 4 mm to 12 mm in size with the following flow rates observed during the test: The highest rates were achieved on a 12mm choke setting, when the CAN. xr-2(h) well was flowed at a rate of 1,791 bbls/d of oil with 2,683 mcf/d of associated natural gas for a total of 2,238 Boe/d (80% oil) over a three-hour period and at an average flowing pressure of approximately 1,304 psi.

On an 8mm choke setting, the CAN.xr-2(h)) well was flowed at a rate of 912 bbls/d of oil with 1,364 mcf/d of associated natural gas for a total of 1,139 Boe/d (80% oil) over a 16-hour period and at an average flowing pressure of approximately 1,433 psi.

During the test period of 142 hours, the total produced cumulative volumes were approximately 2,736 barrels of oil (38 degree API) and approximately 4,154 mscf of natural gas, for a total of approximately 3,428 barrels of oil equivalent (80% oil). No significant flowing pressure declines were observed throughout any of the test rates and no water was produced throughout the test period.

This well represents the first horizontal well drilled into one of the six Sierras Blancas conventional light oil pools discovered to date on the Coiron Amargo block. The Company has an inventory of horizontal development locations on the Coiron Amargo block and a second horizontal well targeting the Sierras Blancas light oil reservoir (CAN-15(h)) is now expected to spud in January 2014 once the drilling operations are completed at CAS.x-15 (see below) and the drilling rig is moved to the CAN-15(h) location. The CAN-15(h) horizontal well will be drilled into one of the largest Sierras Blancas pools on the block and targets a separate pool than was drilled by the CAN.xr-2(h) horizontal well.

The Company is currently drilling a Vaca Muerta shale delineation well at the CAS.x-15 location in the southern portion of the Coiron Amargo block.

Completion and testing operations on this well and on a previously drilled nearby Vaca Muerta shale well at the CAS.x-14 location are both expected to be carried out as part of a multi-well completion and frac program in 2014. The CAS.x-14 well was previously drilled and cased with approximately 105 meters of Vaca Muerta shale on logs.

While Madalena is very encouraged by the initial results from the CAN. xr-2(h) horizontal well, the flowback information disclosed above should be considered preliminary and is not indicative of the well’s long-term performance. Ongoing technical work and operational enhancements are expected to continue to improve the Company’s understanding of the ultimate potential of its Sierras Blancas horizontal oil play. •

6 • Oil and Gas Innovation

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NEWS

Russia Gazprom has started producing oil from the Prirazlomnoye field. It is the first Russian project for developing the Arctic shelf and the commencement of Gazprom’s large-scale activities aimed at creating a large hydrocarbon production center in the region.

Aquatic Supports DeepOcean Training Programme For Graduate Trainees Industry experts from Aquatic Engineering & Construction Ltd, an Acteon company, have presented the company’s work and subsea operations to support DeepOcean UK’s graduate training programme and new conversion engineering programme.

Martyn Conroy, Aquatic EMEA and Americas business development manager, and Sandy Roberts, Aquatic training supervisor, were invited to speak about Aquatic’s work as part of the industry induction for the seven new graduates joining DeepOcean’s graduate training programme and new engineers joining the conversion engineering programme. The Aquatic pair joined other valued service providers of DeepOcean to provide material and education for those embarking on a career with a leading provider of subsea technologies.

Commenting on the programme, Conroy said, “It is always exciting sharing the different aspects of the work we do with new entrants to the industry. DeepOcean is a valued customer for Aquatic, so we were privileged to be among a select group of industry experts invited to deliver an introduction and overview to our area of operations, the technological innovations we provide for our customers and the principles involved. The industry needs to recruit well-qualified engineers and to provide a high level of training and experience for them in order to secure the future of the industry. DeepOcean’s graduate training programme and conversion engineering programme for those joining the industry are market-leading interventions that will be instrumental in supporting the growth of talented young engineers and helping them to flourish across the offshore subsea industry for many years to come.“ Katie Johnson, DeepOcean UK’s human resources manager, added, “We are pleased to have been able to secure the assistance of our suppliers in adding relevance and realism to our training programme. It is essential that we are able to give new entrants a good grounding in the industry, and there is no better way to learn than to hear directly. We appreciate Aquatic’s contribution and look forward to inviting them to participate again in the future.”

Aquatic is renowned globally as an independent supplier of carousels, modular drive systems and tensioner solutions for the oil and gas, telecommunications and renewable energy industries worldwide. The company has a market-leading reputation for laying and retrieving flexible and semi-rigid products on the seabed, proven ability in shallow and deep water, and extensive experience of off- and onshore installations, transpooling, recovery and decommissioning.

Aquatic is part of Acteon’s wider risers, conductors and flowlines offering and joins the other Acteon companies in linking subsea services across a range of interconnected disciplines.

Combining the strengths of a major global organisation with those of independent market specialists, all Acteon companies have complementary skills, experience and technologies that link seabed to surface across a range of interconnected disciplines.. •

The Prirazlomnoye oil field is located in the Pechora Sea, 60 kilometers off the shore. The recoverable oil reserves amount to 71.96 million tons, projected oil production comes up to some 6 million tons a year (to be reached after 2020).

The first oil shipment from Prirazlomnoye is expected in the first quarter of 2014, and it is planned to produce no less than 300 thousand tons of oil throughout the year.

The Prirazlomnaya offshore ice-resistant stationary platform secures every process operation in the field – drilling for oil, its production and storage, end product processing and offloading. It is for the first time in the world that hydrocarbons in the Arctic shelf will be produced by a stationary platform.

Prirazlomnaya is an unparalleled platform designed and constructed in Russia on Gazprom’s request. It is intended for operation under extreme environmental and climatic conditions, meets the most stringent safety requirements and can resist high ice loads. Special alloys resistant to corrosion, low temperatures, high humidity and an aggressive marine environment were used during the platform construction. The platform is secured on the seabed by its own weight (506 thousand tons, including the stone berm artificially created for protection against scouring).

A high-strength deflector secures the platform from wave and ice exposure.

The design features of Prirazlomnaya fully exclude any oil spills during its production and storage. All the wellheads are situated inside the platform. This way, its foundation serves as a buffer between the wells and the open sea.

Produced oil is stored in the caisson with three-meter-high concrete walls covered with two-layer corrosion- and wear-proof clad steel plate. The safety margin of the Prirazlomnaya caisson exceeds greatly the actual loads.

A wet method of oil storage is used at the platform. The method eliminates the possibility of oxygen getting inside the tanks and thus prevents the creation of an explosive environment.

A zero discharge system is employed at the platform. The system excludes the possibility of drilling and production waste getting into the sea. It will be pumped into special absorption wells or, if necessary, collected into tanks and delivered to the shore for further disposal.

Reservoir and oil-contaminated waters will be pre-treated and also fed into the well.

In order to pump the end products into oil vessels, special equipment for direct oil loading was developed. The loading block system goes off in seven seconds at most, making it possible to avoid accidental oil spills.

Year-round product shipments will be secured by Mikhail Ulyanov and Kirill Lavrov super ice-class oil vessels with double hulls and a deadweight (cargo weight) capacity of 70 thousand tons. These vessels were specially designed for shipping oil from Prirazlomnaya and supplying it to the market.

“Gazprom is Russia’s outpost in the Arctic. Last year we conquered Yamal, having created an unparalleled in the world, new onshore gas production center in the Arctic. And today we have pioneered the Russian Arctic shelf development.

There is no doubt that Gazprom will continue advancing in the Arctic,” stated Alexey Miller. •

8 • Oil and Gas Innovation

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Health and safety are also integral parts of our business and are at the forefront of all activities within our operations.

This is one of the main reasons why we are currently a global, world-leading company, operating in 130 countries.

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SPECIAL FEATURE

Suncor Energy and Partners Proceeding With Fort Hills Oil Sands Project The Fort Hills oil sands mining project is located in Alberta’s Athabasca region, 90 kilometres north of Fort McMurray, Alberta and is recognized as is one of the best undeveloped oil sands mining assets in the region. The project’s co-owners are: Suncor Energy Inc., Total E&P Canada Ltd., and Teck Resources Limited.

By Jennifer Habib

Through its affiliate, Suncor Energy Operating Inc. (SEOI), Suncor is the developer and operator of the Fort Hills project via an operating services contract. Suncor Energy Inc. is Canada’s largest integrated energy company and the first company to commercially develop the oil sands — creating an industry that is now a key contributor to Canada’s prosperity. Total E&P Canada Ltd. is a subsidiary of Total S.A. Their focus is to combine cost efficiency with top-tier environmental and social performance to deliver the best possible projects for all of their stakeholders.

Teck Resources Limited is a diversified resource company committed to responsible mining and mineral development with major business units focused on copper, steelmaking coal, zinc and energy.The project is scheduled to produce oil as early as the fourth quarter of 2017 and achieve 90 per cent of its planned production capacity of 180,000 barrels per day within 12 months. With best estimate contingent resources of approximately 3.3 billion barrels of bitumen, the mine life is expected to be in excess of 50 years at the current planned production rate.

“The Fort Hills project is one of the best undeveloped oil sands mining assets in the Athabasca region, is an excellent fit with Suncor’s diversified production portfolio, and will generate significant economic value for Suncor, Alberta and Canada,” said Steve Williams, president and chief executive officer. “Given its combination of ore quality and resource size, we expect this project will be a significant source of long-term cash flow for the company and contribute strong returns for our shareholders.”

The Fort Hills project has been designed to utilize Suncor’s latest technology and approach to tailings management and reclamation processes. Suncor will closely monitor operations to allow for existing and future water quality standards and environmental requirements to be met or exceeded throughout the life of the project. The project aims to return all disturbed lands to as close to a natural state as possible.

“As operator of the Fort Hills oil sands mining project, nothing is more important to Suncor than protecting people from harm. That means safety is never compromised. If it can’t be done safely, it won’t be done at all. That’s why Suncor’s “Journey to Zero” safety program will be used at Fort Hills. Doing so will embed a safety mind-set into every aspect of the Fort Hills business. The goal is to achieve a level of safety excellence that results in an injury-free work site with no environmental incidents. To succeed, everyone at Fort Hills — leaders, employees, contractors, and suppliers alike — makes safety their personal responsibility.“ said Mark Becker, Vice President.

The go-forward capital investment in Fort Hills is estimated at approximately $13.5 billion ($5.5 billion net to Suncor) and is expected to account for approximately 15 per cent of Suncor’s total capital budget on average per year. The total project cost is estimated at a capital intensity of approximately $84,000 per flowing barrel of bitumen and is within the range of similar recently completed oil sands mining projects.

“The Fort Hills economics are positive,” added Williams. “Great effort has been made to ensure that our depth of experience and recent technology improvements in oil sands mines are integrated into the development of the project. We are delighted that the other owners share our enthusiasm for this exciting new development.”

FORT HILLS DEVELOPMENT STRENGTHENS TOTAL’S POSITION IN CANADA Total has reached a final investment decision to develop the Fort Hills oil sands mining project in Alberta, Canada. Total holds a 39.2% interest in the project with Suncor Energy (40.8%, operator) and Teck Resources (20%).Production from Fort Hills is expected to start by end-2017 and to gradually reach the plateau of 180,000 b/d. The estimated cost to develop the project over the next 4 years is approximately C$13.5 billion.

“The Fort Hills sanction is an important milestone that reinforces Total’s strategy to become a significant producer in Canada,” said Yves-Louis Darricarrère, President Upstream at Total. “With an expected mine life in excess of 50 years based on current planned production rates, Fort Hills represents more than 3 billion barrels of resources, and strengthens Total’s global portfolio by adding geographic diversity and long-plateau production with limited geosciences risk”.

“Fort Hills will be developed in a socially and environmentally responsible manner and will integrate recent lessons learned in oil sands mine development. We are confident that this project will bring substantial benefit to Canada, the province of Alberta, and local communities for decades to come,” added Yves-Louis Darricarrère.

Total Exploration and Production in Canada Total has been present in Canada’s Upstream for nearly fifteen years. Its 2012 equity production in the country was 12,000 b/d.

Total holds a 39.2% interest in Fort Hills and a 38.25% operated interest in the Joslyn project, which is in engineering phase. Total also owns a 50% interest in the Surmont SAGD(1) project. Phase 1 production began in 2007 and currently averages 25,000 b/d. Development of Phase 2 has begun, with production scheduled to start up in 2015, enabling Surmont’s total production to increase to around 136,000 b/d. Further development phases are under study. In addition, Total has a 50% interest in the Northern Lights Project following the 2008 acquisition of Synenco Energy. As its oil sands projects advance, Total E&P Canada will continue to focus on innovation and industry collaboration through COSIA (Canadian Oil Sands Innovation Alliance) with a goal to minimizing environmental and social impacts in Northern Alberta while ensuring a long-term, reliable energy supply.

Total is one of the largest integrated oil and gas companies in the world, with activities in more than 130 countries. The Group is also a first rank player in chemicals. Its 97,000 employees put their expertise to work in every part of the industry – exploration and production of oil and natural gas, refining and marketing, new energies, trading, and chemicals. Total is working to help satisfy the global demand for energy, both today and tomorrow.

Teck Announced Partners Proceeding with Fort Hills Oil Sands Project “With an expected mine life in excess of 50 years, Fort Hills is one of the best undeveloped assets in the Athabasca region and is a natural fit with our business strategy of acquiring and developing long-life assets in stable jurisdictions,” said Don Lindsay, President and CEO at Teck.

“With Fort Hills and our other oil sands assets, we are building a new division within Teck that will create value, significant cash flow and diversification for our business for decades to come.” Teck’s share of production is expected to be 36,000 bpd (13 million barrels per year) of bitumen.)

Based on Suncor’s project cost estimates, Teck’s portion of the fullyescalated capital investment in Fort Hills from the date of project sanction is estimated at approximately C$2.94 billion over four years (2014-2017), including remaining earn-in commitments of C$240 million. The gross overall project costs (all partners) since the project restart in 2011 are estimated by Suncor at a capital intensity of approximately $84,000 per flowing barrel of bitumen, within the range of similar recent oil sands projects.

Teck is a diversified resource company committed to responsible mining and mineral development with major business units focused on copper, steelmaking coal, zinc and energy. Headquartered in Vancouver, Canada, its shares are listed on the Toronto Stock Exchange under the symbols TCK.A and TCK.B and the New York Stock Exchange under the symbol TCK. More information about Teck can be found at www. teck.com.

The Fort Hills mining and extraction process The Fort Hills oil sands mining project will be developed as an open-pit truck and shovel mine. The project is planned to mine and process 110 million tonnes of oil sand per year, yielding an average of 180,000 barrels of bitumen per day at full production. The mine life for recoverable resources is expected to be in excess of 50 years.

Fort Hills – Mining and extraction process illustration

Crusher

Surge bin

Hydrotransport line

Rotary wet screen

re O n io t at an ar l p p re p

n o ti ac tr s Ex d ng an ili Ta

ct du et Promark to

Water returned and used in ore preparation

Fine tailings

Mine plan Fort Hills’ open-pit mine plan has two main pits and a mine fleet capable of sustaining a production of 14,500 tonnes of oil sand per hour. The mine will deliver oil sands feed to two ore crushing plants, where oil sand material will be crushed and processed.

Ore from the crushing plants will be mixed with warm water and conditioned to create slurry, which will be transported to primary extraction via three hydro transport lines.

Extraction process In primary extraction, the conditioned oil sands slurry is fed to two trains of separation cells. The separation cells remove the bitumen from the sand, which yields a froth mixture of bitumen, water and clay.

Froth is then sent for further treatment in secondary extraction where it is mixed with solvent and sent through two stages of counter-current settlers to remove asphalt and excess sand and water. The bitumen is then sent to a solvent recovery unit to remove the solvent and prepare the bitumen for shipping.

The final product is marketable bitumen.

Primary separation

Tailings solvent recovery

th o t Fr en tm ea tr

Fine solids for drying and reclamation

Secondary separation through column flotation

At the current rate of production, conventional oil reserves are expected to last for fifty years. Heavy oils can supply an additional twenty years’ worth of production.

However, these oils are complex to extract, and there are a number of technical and environmental issues that must be addressed in order to develop them responsibly.

Heavy oils are an essential component of the world’s future energy mix. The volume of oil-in-place is estimated to be between 4,000 and 5,000 billion barrels (Gb), translating to resources of up to 600 Gb. These figures reflect the enormous potential of heavy oils: they are equivalent to 60% of global reserves of conventional crude oil and account for 20 to 25% of the world’s petroleum resources.

The Americas, from North to South Some 80% of all heavy oils are extra-heavy.

These include oil sands, which are highly complicated as well as costly to develop.

Although found in all parts of the world (e.g., Russia, USA, Middle East, Africa, Cuba, Mexico, China, Brazil, Madagascar, Europe and Indonesia), the largest accumulations are located in Venezuela (the Orinoco Belt) and 12 • Oil and Gas Innovation

Product solvent recovery

Bitumen recovery

Bitumen product tank

Canada (Province of Alberta). Combined, these two regions represent nearly © 20133,000 Abio 2013.12.18 billion barrels of oil-in-place. They also account for 95% of global production of heavy oils (2.2 million barrels per day in 2008, twothirds of which are in Canada and one-third in Venezuela). Although less than 1% of these resources are produced or under active development today, output should nearly quadruple, reaching at least 7 or 8 Mb/d by 2030.

Limiting environmental impacts The processes involved in extracting and upgrading these oils require huge quantities of energy and water. For this reason, developing them sustainably on a large scale poses major economic, environmental and technological challenges. Improvements focus on driving down technical costs; enhancing recovery factors and energy efficiency; curbing CO2 emissions and limiting water consumption and the footprint of these huge developments.

There is no question that the complexity of these challenges is of another order of magnitude compared to conventional oil developments. • contact: jennifer@oilandgasinnovation.co.uk

OIL AND GAS INNOVATION PRESENTS: INNOVATION IN THE TANK STORAGE INDUSTRY

13 • Oil and Gas Innovation

TANK STORAGE - STOCEXPO SPECIAL

Mobile Degassing Service For the Tank Storage Industry

Oil and Gas Innovation sits down with German firm ENDEGS to discuss how companies can combat their emissions be released into the enviroment in their operations OGI: Could you please start by telling us how you help companies control potential pollution of the atmosphere?

ENDEGS: ENDEGS is the degassing specialist and pioneer in service for mobile combustion in Europe. ENDEGS specializes in mobile degassing utilizing thermal oxidation of VOC & HAP (Hazardous Air Pollutants).

We offer solutions for emission control during maintenance activities, load / unload applications or as back up of gas engines and customized solutions in refinery, tank storage, ports and pipelines. ENDEGS provides expert advice in safety issues, for procedures and project preparation in form of turnkey degassing projects.

By focusing on the drawbacks of fix installations we exemplify the emissions still being released. We can assist when fix installations do not perform as required or are out of commission due to maintenance, malfunction or being down for repair, and no backup is available even though a hazardous emission may be expected. We help the customer by developing clientoriented solutions, by applying our highly efficient mobile degassing equipment and by providing trained personnel. ENDEGS is able to solve the most difficult requirements by providing self-sufficient mobile units with capability of 99.9% destruction of hazardous pollutants.

ENDEGS has degassed over 5 million mÂł of capacities in refineries, tank farms and vessels.

Degassing during decommissioning- refinery shutdown 14 • Oil and Gas Innovation

OGI: What type of process is used to manage the concentration of vapours within tanks?

And how efficient is the outcome in terms of the carbon waste which one is trying to eliminate?

German TÜV during different projects.

ENDEGS: As said before our trailer mounted vapor incinerator has the capability of 99.9% destruction of harmful compounds. The process which is applied, is basically an incineration with a support fuel for low flash point vapors. For support fuel we apply propane.

ENDEGS: We convert the CnHm into CO2 and H2O. The heat radiation is low. The system is backfire-safe. The safety installations are realized intrinsically safe.

Under normal conditions ENDEGS creates a low pressure atmosphere and thus draws the vapour out of the respective container. The combustion which follows is a highly efficient process and the destruction rate is better than 99.9 %. This result has been repeatedly confirmed by external authorities such as the

OGI: How is this Process achieved safely, without hurting the environment?

Our Equipment is realized intrinsically safe and designed to comply with German Industrial Safety Regulations which means all relevant safety regulations are being adhered to e.g. ATEX. The construction design complies with European standards.

We develop, produce and maintain our own equipment, all of our systems are certified by TÜV, the German technical safety authority.

At the moment there is no comparable quality

standard for mobile application on the market so we set our own high standards with “Safety first” and “Customer peace of mind” as a bench mark.

Our broad experience in mobile degassing with many different applications has been a valuable factor in our constant improvement program and thus incorporated permanently into the overall design of our mobile vapor incinerators.

ENDEGS Mobile VCU: No visual flame – no odor - no ground level radiation - no smoke low noise - integrated power supply -minimal set up work on site - less space required - no impact on the neighborhood - no clean up after job is done - full complement of safety equipment.

OGI: What sort of industry regulation & government legislation apply to the tank storage industry which would require a firm to take advantage of environmentally safe degassing?

ENDEGS: All pollution laws and regulations in place are done so in order to keep the environment clean. In Germany several clean air acts are in place especially the BImSchG (Bundesimmissionsschutzgesetz) and the TA Luft (Technische Anleitung Luft). Several regional regulations involving pollution require an effective degassing process. A prime example are marine regulations during tanker loading operations.

As far as we know, ENDEGS is the only certified company following the SCC P Standards for the degassing issues. (Safety Certificate Contractors Petro chemistry). We are SCC** (Safety Certificate Contractors) approved and ISO 9001:2008 certified

15 • Oil and Gas Innovation

OGI: Besides Tank Storage, what other industries and sectors require this sort of treatment?

ENDEGS: ENDEGS VCU are adaptable to various applications and products: Such as Refineries, oil mills, fertilizers, stations, repair centers for rail tank cars to name a few.

We can treat the VOC and HAP of: • • • • • • • • • • • •

Receptacles from 10 m³ to 115.000 m³ Tankers up to 200.000 t DWT River tankers Mobile tanks Suction trucks VRU & VPS (temporary replacement) Tank truck rail car loading / unloading Shutdown - Decommissioning Columns, Flares Pipelines, Pipes Spheres Customized solutions Emission surveys HAZOP Risk Analysis Development of degassing procedures (applications, products) Voc measurements

Known as a reliable specialist in Europe ENDEGS proudly has worked for: BASF, BP, DOW Chemical, PETROINEOS, LBC, lyondellbasell, Oiltanking, TOTAL, VOPAK, YARA …

Whoever decides to contract ENDEGS will be assured they will receive the best quality at a fair price for excellent service. ENDEGS places a high importance in safety for all the personnel concerned and the potential impact on the surrounding environment . We are known for standard and custom solutions.

We stand for quality by analyzing the situation on site and a sound consultation for the required service, starting with a meticulous preparation, followed by a safe and effective operation and finishing of with a precise invoice without any surprises for the customer.

The ENDEGS Advantage: In today’s world the relationship with one’s neighbors has an increasing impact in the success of companies in the Gas & Oil industry. We assure this success by supplying a service which results in elimination of hazardous elements without creating a disturbance to the neighborhood.

Safety: According to present day standards all procedures in the industry have to be appraised in respect to safety issues. We assist this appraisal by not only destroying hazardous pollutants, but ensuring not to create a hazardous situation by doing so.

Our personnel as well as that of the customer are not submitted to any hazardous conditions.

Photo courtesy of ENDEGS GmbH

16 • Oil and Gas Innovation

“We came to this conclusion after our Security and Maintenance Department consulted with the German Company ENDEGS. ENDEGS’ technical competence provided a quick and efficient solution to our problem with strict compliance to safety and environmental regulation.” - EssenCiel OGI: In your opinion, what are the outstanding achievements and innovations ENDEGS has achieved over the past few years?

2012 - ENDEGS develops and performs new applications: • Degassing of marine Vessels > 160.000 t and river tankers • Degassing while stripping with steam • Operation during refinery shutdown 2010 - ENDEGS develops and introduces new procedures: • Degassing of ammonia tank (20.000 t liquid, minus 33 °C) • Degassing of n-hexane tanks • Degassing of butadiene tanks • Degassing pipelines longer than 110 km • Temporary replacement of VRU (trucks and wagon loadings) • Temporary replacement of VPS (Vapor Processing System) 2008 - ENDEGS sets off new standards for: • Development and implemented emission free procedure for automatic tank cleaning using nitrogen • Introduction of degassing suction trucks and mobile tanks • Degassing of containers ranging from 10 to 110.000 m³ • ENDEGS B.V. +31 (0)642 497 487 ENDEGS GmbH +49 (0) 841 90 14 130 ENDEGS Sarl +33 (0) 6 21 13 41 42 info@endegs.com www.endegs.com

2014

StocExpo AHOY, Rotterdam 18 – 20 March 2014

10 TH

The storage terminal operators’ conference and exhibition

SAVE THE DATE! 18-20 March 2014, AHOY, Rotterdam

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TANK STORAGE - STOCEXPO SPECIAL

Product Spotlight: Hazardous Environment Alternators The company commenced manufacturing A.C. generators in 1988. Original designs were of the slip-ring type, but soon after brush-less designs were produced to match customer’s requirements. Many of the key personnel in design, production, quality and after sales service have worked for many years within the generator/set industry and their experience has contributed to the final design and reliability of the machines.

Gencoeec Ltd of Ketton Lincolnshire UK have developed special types of brushless non sparking 4pole 50/60Hz [1500-1800RPM]and 2 pole 50/60 hz [3000-3600RPM ] alternators specifically for use in hazardous environments in mines and oil fields.

The machines comply with European and North American specifications for zone 2 EExnA/BIIT3 and ATEX compliance.

The power range is 2 to 300Kva 50/ 60Hz single or 3 phase voltages 110/650v which accommodates most electrical loads.

All the units are totally enclosed intended to be driven by diesel engines or hydraulic

3 x RF355lL z2 teab

motors. They have been designed to be self cooled without the need for separate air or water coolers. Machines up to 40Kva have the external fans shaft driven to EN600346, IC41A1A1 and larger alternators up to 300KVA have electrically driven high efficiency fans to IC41A1A6 and comply with electrical equipment enclosures in accordance with IEC60034-15, and NEAMA class1 Div2 with IP54/56/65 protection Being self cooled with sealed for life bearings they are very reliable with minimum maintenance for use in remotest locations.

The non sparking feature has been achieved by careful design of the magnetic flux levels, rotational air gaps and fan clearances with the selection of non sparking materials.

Specification IEC 60034-0 defines the various zones or area of potential explosion risk The machines comply with Zone 2 EExe and EExnA/B. Various working ambient, altitudes and load power factors can be accommodated and Power Correction Coefficients graphs are available which give the degrees of de-rate with increased ambient /Altitude/ Power factor .

Oilstates crane with Gencoeec z2alt

MARINE CLASSIFICATION Although the alternators work generally on oil rigs and exploration platforms they are not classified with marine society classification such as DNV, ABS, Lloyds etc with surveyed materials but can be de-rated to work at increased ambient [normally 40c] and the windings temperature rise to reduced levels.

Also as in marine alternators the sustained short circuit current can be arranged to provide 3-5 times the full load current for at least 10 seconds for load discrimination.

All machines use the most modern materials with class H [125c rise in 40c ambient] but temperature rises can be arranged to meet class F, B or E temperature rises.

TYPES OF PRIME MOVERS The majority of gen-sets use diesel engine drives which are modified to work in Zone 2 areas but some smaller sets up to 30Kva are driven by hydraulic motors. This can present an over speed when load is suddenly removed and the hydraulic speed controller responses too slowly and effects the alternator rotor windings which can be damaged due to the increased centrifugal force unless special extra rotor bracing is fitted, overspeeds of twice the normal running speed can be achieved without damage to the rotor windings.

Deciding upon the required Kw or HP rating of the engine or motor can be achieved

for a steady state load of a given power factor load [usually taken as 0.8 lagging ] as Kw mechanical = Kva [alt] x PF [load] divided by full load efficiency [Alt] The HP=Kw mechanical divided by 0.746 Example 50KVA alternator full load efficiency 87% required engine Kw[ mech] =50 x 0.8 dived 0.87=46 KWm,HP= 46 divided by 0.746= 62 Sometimes the rating of the prime mover needs to take into account peak loads for short periods of time when a greater demand on the engine Kw is required and the response of the governor together with the effects of the transient speed reduction on the alternators output voltage must also be considered.

TEMPERATURE MONITORING Since the zone2 alternators are totally enclosed construction it is not possible to monitor the temperature of the alternator windings by thermometer of thermal imaging devices, the only satisfactory method is to use resistive devises or thermo couples embedded in the stator windings such as PT100. In three phase machines usually each phase has an embedded device fitted during the manufacturing.

It is very difficult to monitor the temperature of the rotor windings and one solution is to fit thermo tabs and at convenient maintenance periods, then check the maximum recorded temperatures.

Generally since the machines are totally 19 • Oil and Gas Innovation

enclosed and in all well designed machines the stator and rotor temperature rises are at the same thermal rating and therefore by monitoring the stator temperature will give a very good indication to the rotor winding temperature. If a fault occurs on either the rotor or stator windings then there will generally be an increase of the temperature inside the machine which will be detected by the thermal devices in the stator winding.

PARRALLEL OPERATION Most alternators are designed to operate in stand alone arrangements but additional components [droop circuit kit] can be fitted to the alternators to provide satisfactory paralleling with a similar machine or with a power sensed control parallel with a larger distribution system.

All Gencoeec Ltd machines are individually manufactured which provides the facility to design and manufacture each machines to suit each customers particular requirements. •

CONTACT DETAILS GENCO EEC LTD Tel: + 44 (0) 1780 721 619 Fax: + 44 (0) 1780 721 385 E-mail: generators@gencoeec .co.uk www.gencoeec.co.uk

TANK STORAGE - STOCEXPO SPECIAL

Profitability, Client Satisfaction and Compliance Brainum explains the importance of using information technology in the liquid bulk industry. Today’s challenging economic climate results in an increased focus on efficiency. Liquid bulk terminals not only need to offer competing prices, they also need to be more agile to more quickly respond to ever-changing customer needs. Terminals require real time management information to be able to decide and act. This is where modern, Integrated Business Software, specifically designed for the liquid bulk industry, can help.

The challenges of an average day

Towards a digital reality: how IT helps

All too often terminals lose money by being uninformed, being informed too late or being informed inaccurately. Without correct real-time information and planning tools there is sub-optimal usage of assets and increased costs. It leads to incorrect transport documents, wrong administrative / physical stock overviews, wrong customs declarations, sub-optimal berth occupation, etc.

Generally, the functions at a terminal can be modelled into 5 information layers (figure 1). Many of these functions are administered in Excel, or in standalone, isolated point solutions that entail departments working in information silos – resulting in a lot of inefficient, duplicated work, increasing the risk of failure. The recent answer to this is Integrated Business Software designed specifically for the liquid bulk industry.

To stay on the safe side, terminals tend to be conservative when responding to customer needs; orders and nominations are kept on hold for too long (demurrage costs!), pipelines are pigged too often because there is no visibility on future orders with the same product (contamination!) or blends are created wrongly by misinformed operators.

Continuously changing contract agreements create administrative chaos. The risk of manually invoicing wrong volumes and services, or even forgetting to invoice them is high. All leading to potentially lost revenue and unhappy customers.

To cope with these challenges, terminals require flexible processes, advanced planning tools and real-time information.

Integrated Business Software • •

•

•

Offers full process and information integration; Has one database only; data needs to be entered only once, is always up-to-date and available to any user at any time. Editing of information is processed simultaneously and immediately at other places for other functions; Is workflow-driven, process-oriented, structuring all sub-processes, and informing all staff in the process on what they need to do and when; Integrates processes; shares information at different levels for various stakeholders and presents it through user-specific dashboards, enabling quick decisionmaking and managing.

QINO: an integrated IT solution designed for the liquid bulk industry An integrated software solution for the liquid bulk industry is QINO, developed by Dutch company Brainum. Brainum’s deep experience and understanding of the sector resulted in a Terminal business Management System (TMS) that is tailored to the industry.

This TMS contains all functionality at level 3, 4, and 5 (figure 2) to operate and manage terminals. It brings all administrative, logistical and operational processes together in one integrated system. QINO interfaces with standard software solutions for financial accounting, customs management and digital control systems (DCS, SCADA) and offers one interface to handle all processes.

QINO comes with a full set of integrated preconfigured terminal-specific work processes (workflows), reflecting best practice in the liquid bulk industry. This includes processes for: managing order-2-cash; supporting stock accounting; managing gains and losses; registering, managing and following up on incidents; guiding operators in their operational activities in the field, etc. Each process gives management direct visibility and control on its progress and status.

Figure 1. (Separate) functions per information level

TANK STORAGE - STOCEXPO SPECIAL

QINO is based on a single database. Data entered anywhere directly informs and affects any other process in real time. This allows for direct data look up anytime, anywhere, offering additional flexibility to efficiently organise the complicated world at the terminal by informing all stakeholders at once.

forecasted stock volumes and equipment availability.

•

Organising the complicated world The terminal specific technology comes with advanced planning capabilities and tools for various time horizons – from long term to short term (tactical): •

Long term (months to days) The supply & demand planner gives customers insight into future stock levels per tank, product and period, as well as in planned nominations & orders and their impact on stock levels.

Nominations and orders can be planned based on customer and order priority,

•

Medium term (days) The berth & jetty planner allows for optimal utilization of berths and jetties, based on forecasted vessel arrival times and handling times. Demurrage costs can thus be minimized, while customer service is improved. An interface with a leading Maritime and Nautical data provider is available to receive real-time ETA’s. The impact of changes in ETA’s will be directly visible in the planning.

Short term (hours, minutes) The movement (route) planner suggests the optimal sequence of movements in the tank park based on customer orders and priorities. QINO’s automatic line-up functionality suggests the most optimal route for each movement between source and destination taking into account equipment status, product

type (to prevent contamination), pump rates and real-time feedback from field operations. QINO calculates theoretical densities and pre-calculates stop levels, informing operators or DCS when to stop a movement and thus preventing overflow or off-spec blends.

QINO puts the terminal manager back in control and allows him to run the business efficiently and satisfy his customers, thus enforcing: •

• •

Compliance: ensuring the terminal is compliant with the latest (stock & customs) accounting principles and governmental (safety-driven) requirements; Transparency: which processes are running, who is doing what; Control: knowing exactly what is going on, being well informed, and making the right decisions.

Figure 2. QINO: Conceptual overview of QINO single database architecture

Brainum specializes in Tank Terminal IT Solutions that achieve operational and commercial advantages for clients built on a deep business understanding.

Become future-proof with an integrated IT solution While present times demand high client satisfaction and optimal efficiency, too much money is still being lost by being uninformed and through inefficient processes. Modern IT business management solutions can help terminals become future-proof again.

By integrating processes and optimizing workflows, enhanced with advanced planning capabilities, IT can help terminals remain and become more competitive - and face a transparent and well-informed future. •

21 • Oil and Gas Innovation

CONTACT DETAILS Brainum

Vondellaan 68 3521 GH Utrecht The Netherlands T: +31 30 267 1030

E: m.keulemans@brainum.com For more information, please visit www.brainum.eu

Hydrocarbon Liquid Leak Detection & Location Technology From France TTK is launching a new range of Hydrocarbon Sense Cables: FG-OD. These sense cables are addressable, re-usable, multi-leaks and can be used for long-line systems. FG-OD cables are to be connected to TTK digital control panels, as FG-NET Touch Screen Digital Panel.

In the TTK leak detection system, the sense cables ensure a continuous protection of areas where storage tanks or production / distribution pipes are located.

FG-OD sense cables are available in standard, pre-connected lengths, (3 m, 7m and 12m) or cut-to-length reels (120m or 360m) for long-line applications, allowing optimized system architecture.

In the event of hydrocarbon leakage: The sense cable in contact with the liquid detects and transmits to the digital unit the information of leakage.

The FG-NET unit triggers an audible alarm, activates relays and displays the location of the leak on an integrated dynamic map.

FG-NET unit can send alerts in email and SNMP traps to a LAN-connected Management / Control System.

FG-OD Hydrocarbon Sense Cable’s Features & Benefits • Can be reused.

• Quick detection times: Gasoline: 3-5 minutes (*),

Diesel Oil: 15-20 minutes (*), Jet Fuels: shorter times

than Diesel Oil. • Note (*): depending on liquid composition and leak conditions • Reliable detection: insensitive to water, small

pollutions, dirtiness, external loads (pressure).

• Sense cable construction including proprietary

silicone sensing wire, continuity wire,

communication bus wire and power supply wires.

• Multiple leak detection and localisation thanks to

independent digital addressing, enabled by

an embedded microchip in each FG-OD sense cable.

• The same unit can be connected to both

hydrocarbon sense cables and Water or Acids/Bases

sense cables at the same time.

• Easy to install and remove.

• Small in diameter (7 mm nominal) with a protective

external PE braid in an orange colour.

http://www.ttkuk.com/en/

13th North Caspian Regional Atyrau Oil & Gas Exhibition 8th Atyrau Regional Petroleum Technology Conference

ATYRAU OIL & GAS

1–3

April 2014 Atyrau Sports Complex Atyrau • Kazakhstan

OILTECH ATYRAU

1–2

April 2014 Renaissance Hotel Atyrau • Kazakhstan

The Business Event for Exploration and Production in the Region

Tel. +44 (0) 20 7596 5082

Email: og@ite-events.com

London • Moscow • Almaty • Baku • Tashkent • Atyrau • Aktau • Istanbul • Hamburg • Beijing • Poznan • Dubai

E&P

Innovative Welding Alloys and Processes for the Oil and Gas Industry As the upstream stage of the production of oil and gas becomes more challenging, particularly in deep water offshore environments, the need for safety and reliability remains ever critical.

Sandvik Wire and Heating Technology, a division of Sandvik Materials Technology, is one of the companies that specialize in delivering reliable products to safely pursue energy resources around the world. The upstream stage of the production of oil and gas becomes more challenging, particularly in deep water offshore environments, in these conditions workers, the environment and bottom lines must all be protected. In today’s energy industries, many of the deposits are high in hydrogen sulfide. These aggressive conditions create a corrosive environment that can cause rapid failure in drill steels and piping. The lifespans of these tools can be significantly extended through weld cladding.

Sandvik Wire and Heating Technology have developed several new alloys to meet a variety of specific needs and customer constraints.

Several new and traditional alloys have been qualified for gas tungsten arc welding (GTAW), gas metal arc welding (GMAW), submerged arc welding (SAW) and Strip weld cladding. The alloy of choice for cladding of subsea components is NiCrMo3. These standard cladding processes are normally semi -automatic.

Some less conventional processes now being used include Automatic Hot Wire TIG, Pulsed MIG and Electro Slag Weld Strip overlay. The latter processes have been highly developed using computer controlled automatic systems capable of depositing and tracking the process.

The computer simultaneously controls the positioner, manipulator and power source.

These systems record events such as voltage spikes or current abnormalities where weld defects can occur. Integrated computers track the points where these events occurred and can return to the same location and look for defects. Tools can subsequently be attached to the manipulator and repairs made.

Equipment builders such as Arc Specialties in Houston, Texas, manufacture equipment to clad complex shapes such as ring grooves in

blowout preventers with very precise control to minimize dilution and maximize weld quality. Special alloys are now available that take maximum advantage of the aforementioned equipment, providing optimum chemistry and ferrite in the clad weld metal, which, again, minimizes dilution and maximizes weld quality.

An example of Electroslag Weld Strip Cladding capable of single layer, chemistry control fully alloyed, low carbon deposits @ 14-40 kg/hr occurred in developing procedures for cladding of a ring groove the larger components require more than using the SAW process. The customer was 250 lbs (115kg) of weld metal per part, so experiencing weld cracking, and after an the strip overlay process will save many investigation it was found that the ferrite hours of welding time. Cost savings here are content of the weld deposit was too low. A significant. combination of a modified alloy 309LMo (giving a 316L deposit) and a neutral higher Electro Slag Weld overlay has been used for basicity flux solved the problem. many years for cladding of reactor vessels, heat exchangers and hydrotreaters with 347 Several international fabricators have now and 316L deposits in single layers. Cladding qualified weld strip overlay for cladding using Electroslag vastly increases deposition of larger subsea components capable of rates with minimum machining required. depositing 30–90 lbs/hour (12–24 kg/hour) This compares favorably with SAW wire, for single pass weld overlays. This exceeds the which requires three passes, more machining typical requirement of 10 percent maximum and over welding to achieve the desired weld iron, which is important for adequate metal thickness. corrosion resistance. Actual iron content of 6–7 percent in a single pass have now been For Hot Wire TIG welding with AWS achieved on 4130 base material.

NiCrMo3 (Sandivk Sanicro™ 60), the weld wire is delivered with optimized feeding and In the last year or so, new opportunities to chemical composition, giving low surface improve productivity have been realized oxides and oxide inclusions in the weld using the aforementioned systems. Some of deposits. These features minimize post-weld 24 • Oil and Gas Innovation

cleanup and possible defects. A clean weld surface reduces the need for cleaning between layers and ensures very low oxide inclusions in the weld metal. Feeding is especially important when cladding the ID of small diameter components of approximately 2 inches (5 centimeters). If the wire fails to feed properly, the fabricator faces the choice of scrapping the part or re-boring and re-welding. Automatic Hot Wire TIG is being used for cladding of small diameter 40-foot (12-meter) pipe, flanges and various other components.

Additional weld metal enhancements can be achieved with shielding gas compositions, which are relatively new on the market. Hydrogen additions, for instance, scavenge oxides and leave a bright clean surface behind. Three new welding alloy grades are being rolled out for single or multi-layer surfacing which are now available on the market: • •

•

For 316L deposits, Sandvik® 24.16.3.L, a new wire composition, 24Cr, 16Ni, 3Mo Low Carbon.

For 304L deposits, Sandvik® 24.13.LHF with a 14-16FN, 24 Cr, 13Ni, Low Carbon, which is a high ferrite recovery grade that eliminates micro fissuring issues.

For 347 deposits, Sandvik® 24.13.LNB, 24Cr, 13Ni, Nb stabilized is available. This grade is a welcome addition, particularly for weld cladding of small diameter pipe.

More traditional alloys being used for oil and gas development both upstream and downstream are: •

•

• •

Duplex Alloys SAF 2205™; Sandvik®22.8.3.L (AWS ER2209) and SAF 2507™; Sandvik®25.10.4.L (AWS ER2594) and SAF 2906™; Sandvik®29.8.2.L Super austenitic Sandvik®20.25.5.LCu (AWS ER383) and Sandvik®20.25.5.LCu (AWS ER385) Alloy 825 (Sanicro™ 41Cu) Alloy 600 (Sanicro™ 72HP)

Other innovative Sandvik units in the market: • Sandvik Coromant: drilling and machining systems • Sandvik Tubular Products: Seamless Tubing

for such products as umbilicals, risers, and trees • Sandvik Process Systems: Sulphur pelletizing

systems which are capable of desulphurizing

crude oil at the platform for easy further

processing.

CONTACT DETAILS

Arc 05 weld cladding system developed by Arc Specialties 25 • Oil and Gas Innovation

Sandvik Materials Technology http://www.smt.sandvik.com/en/products/welding-products Frank Babish, Technical manager Tel. +1 888-852-9442 E-mail: frank.babish@sandvik.com For the third year running Sandvik has earned a position on the prestigious Thomson Reuters Top 100 Global Innovators list. The list designates 100 corporations and institutions around the world that are at the heart of innovation as measured by a series of proprietary patent-related metrics.

E&P

Multifunctional Winch Spooler Can Also Support ‘Other’ Winches Dutch based HydrauRent has the advantage of being a one-stop shop for hydraulic solutions on a rental basis which enables the contractors and producers to use these solutions on temporary basis for possible emergencies and/or short term lease. Furthermore, its distinguishes the company as they provide the client with a way around buying expensive products long term when this is not necessarily needed. In particular Oil and Gas Innovation and HydrauRent focus on their new advanced winch spooling device.

Modular HydrauPack and HydrauWinch solutions for rent

HydrauRent has introduced an advanced winch spooling device, the HydrauTool Spooler 25/50. It is used to evenly wind a winch cable across the full width of a drum. Roland Picavet, commercial manager, explained: ‘Considering the fact that the pulling force of our rental winches differ each time, the mechanical winding method - by means of a fixed grooved spindle construction, whereby the cable is wound by means of a parallel movement from left to right and vice versa, is not suitable.

This is not a flexible solution for handle different wire diameters. That is why we developed this new winch spooling device.’

And not only the cable diameters differ, the pulling force varies greatly as well: HydrauRent has a series of winches, from several tons of pulling force up to the 80-ton versions.

An advanced winding system was therefore needed. Starting points for development were a ungrooved drum, variable cable diameters, and variable pulling forces, in combination with the demand for winch positions with a large fleet angle. The latter because of the lack of space that is often the case, for example on deck.

Standardised connections The new spooling device, which was developed by parent company Hydrauvision, is electronically controlled. According to several standards and also based on experience, the fleet angle may not exceed 2 degrees. This was also practice-inspired. The guidance consists of a guiding cell comprising two rollers and a sensor.

This electronic sensor measures the angle and ensures that the cell moves more or less according to the desired angle. The spindle is in-between the two rollers and is hydraulically driven. The HydrauTool Spooler 25/50 was specifically made for the HydrauRent HydrauWinch 25 CT and HydrauWinch 50 CT winches.

Customised units and related components

HydrauRent has introduced an advanced winch spooling device, the HydrauTool Spooler 25/50.

The spooler frame is a crash frame, i.e. a protective frame and approved according DNV2.7-3 (lifting in offshore). Picavet: ‘The spooling devices can also be used for “other” winches, on the condition that the size will approximately match. Normally, a maximum angle of 30 degrees is used with the full pulling force of a 25-ton winch; but, depending on various factors, an angle of 17 degrees can be used for winches up to 50 ton pulling force.’ In short, the new spooling device is multifunctional.

Versatile specialist in drive technology Hydrauvision’s main activity consists of the engineering of custom made hydraulic system solutions. The company stands out from the competition thanks to its unique combination of mechanical engineering design and drive technology. Other activities include revision & repair and service & maintenance of hydraulic systems and components. Hydrauvision has subsidiaries in Schoondijke, Dordrecht, IJmuiden, Zeebrugge and Ghent. •

CONTACT DETAILS HydrauRent Riverside House Riverside Drive ABERDEEN, AB11 7LH United Kingdom T: + 44 (0) 1224 515920 F: + 44 (0) 1224 515921 M: info@hydraurent.com

“Customised units and related components” 27 • Oil and Gas Innovation

E&P

Waste Management Systems For the Oil and Gas Industry Marine litter and in particular plastic waste, is a global problem. The vast majority of plastic waste is destined for a landfill site, which limits the impact through ‘containment’, however does not solve the problem. A significant proportion of plastic gets into the watercourse and eventually ends up in the oceans. As might be expected the plastic waste on the coastlines is more prevalent around more populated coastal areas. However, once the plastic waste enters the oceans it is influenced by global currents that distribute it around the world.

Delitek was established in 1992 after the founding owner heard a radio programme about how long it takes waste thrown over board from ships to dissolve –up to 450 years, in the case of a plastic bottle – and decided to do something about it. The firm’s prototype waste compactor was trialled on a fishing vessel and the first production models were supplied to rigs operating on the Norwegian Continental Shelf. But in its early years the company found it difficult to persuade vessel owners to invest in onboard waste handling systems, but this gradually changed with growing concerns about the effects of marine pollution and the introduction of increasingly stringent environmental regulations. A major breakthrough came when Delitek signed a framework agreement with Teekay Shipping in 2003. Business took off after that and Delitek was able to expand the product range.

All the arrows have pointed upwards ever since and turnover has been doubled every year over the last five years.

containerized waste management station designed to enable owners and operators to comply with new MARPOL regulations effective from 1st January 2013. The new rules prohibit all vessels of 400 gross tonnage and above and all vessels certified to carry 15 or more persons from simply throwing their waste over the side except in certain circumstances.

“...it takes just a few weeks after buying one of our waste handling systems for our customers to see a return on their investment.”

Today Delitek is recognised as one of the world’s top three suppliers of marine waste management equipment and it’s a global network of agents. It serves seven segments within the sector – marine, offshore, navy, cruise, yacht, fishing and onshore – and secures most of its orders from offshore customers. Delitek is an approved supplier to the Central and Northern European offshore sector through its Achilles JQS and Connexio memberships. Cruise ships are an emerging market which Delitek believes has great potential to grow after it formed partnerships with Scanship, from Norway, and Evac, from Finland, to design and manufacture food waste management systems suitable for smaller passenger vessels. Technology Partners In co-operation with another of its technology partners, the German firm MOE GmbH, Delitek has developed a new 28 • Oil and Gas Innovation

The MORTIM concept, which was unveiled at SMM 2012 in Hamburg, is a practical solution where there is no space available inside ships for waste handling or storage and the cost of retrofitting a system is impractical and/ or prohibitive. Each container, which can operate from anywhere on a ship’s deck, houses compactors, shredders and glass crushers, as well as additional equipment such as oil filters and oil can crushers. “The MORTIM system will make it easy for new and existing OSVs and other specialist vessels which generate large amounts of solid waste to comply with the regulations,” said Mr Larsen. “Each system will be custom-made and fitted with bespoke equipment needed to treat, store and dispose of waste to suit individual operational requirements. It seems we have introduced this product to the market at just the right time because we are receiving a growing number of enquiries.”

Delitek’s products are manufactured by its wholly-owned subsidiary Delitek Production AS Production The very first waste handling system Delitek AS manufactured 20 years ago is still its bestselling model today. The medium sized DT500MC, like other products in the company’s DNV-approved Greenship range, consists of a shredder as well as a compactor. “By first shredding and then compacting, extreme reductions in waste volumes can be achieved,” explained Morten Larsen, Director of Sales and Marketing. “Used in isolation, a compactor will generally achieve around 70 per cent volume reduction. But if a shredder and compactor are combined within the same system, volume reductions of 90 per cent are possible with most solid waste materials. If ship owners can minimise waste volumes by 90 per cent, then they can minimise their waste management costs by 90 per cent, too. This means it takes just a few weeks after buying one of our waste handling systems for our customers to see a return on their investment.”

smallest compactor is able to pass through loading hatches measuring 600mm wide by 400mm high, making for easy interior installation and avoiding the drastic step of cutting a hole in a ship’s structure.

Modern Factory Delitek’s products are manufactured by its wholly-owned subsidiary Delitek Production AS, which operates from a modern factory (opened in January 2010) adjoining Delitek’s headquarters in Alsvåg in northern Norway.

“Even our main competitor does not have their own factory – they outsource,” said Mr Larsen.

“Having in-house production facilities gives us full control over the design and manufacturing process and enables us to customise products and react quickly and flexibly to specific

requests. We have the capability to deliver products more or less immediately after receiving an order, while many of our rivals operate on turnaround times of between four and eight weeks. Our products are also of the highest quality and this is another of our unique selling points. It is not our intention to try and compete with low-cost manufacturers in Asia on price.”

Future Delitek will keep monitoring the market and have our eyes and ears open for input from owners and operators, at the same time continue to manufacture and further develop world-class solutions for waste handling, especially for the marine and offshore industry. •

CONTACT DETAILS Delitek A/S

Delitek’s systems, which can also incorporate glass crushers and balers, are made of stainless steel, making them suitable for indoor or outdoor use on vessels and offshore rigs and platforms. They offer compaction forces of up to 15 tonnes and feature wheeled, interchangeable containers making for easy segregation of consumer waste in accordance with industry standards. The company’s

Moloveien 8432 Alsvåg Norway Phone: +47 76 18 57 60 Fax: +47 76 13 42 77 sales@delitek.no www.delitek.no 29 • Oil and Gas Innovation

E&P

LIRA Technology Used For Fault Location and Condition Monitoring of Electrical Power Cables

Moving from its traditional base of nuclear power plant cables, Wirescan A/S offers solutions for the Oil and Gas industry which is a viable option for the producers. Oil and Gas Innovation highlights the patented product, among others in Wirescan’s product portfolio in this exclusive feature.

Wirescan is a service and product provider of cable fault location and cable condition monitoring using its patented and unique LIRA® Technology. The LIRA Technology applies a low voltage (harmless to the cable) signal at several radio frequencies between any two metallic cores in the cable, and detects and locates any impedance irregularities in the cable insulation. These irregularities, which can be caused by damages, defects and joints, are displayed as a function of the cable length.

Using the LIRA Technology for fault location and condition monitoring helps clients all over the world save big money on reduced unplanned power outages, costly cable repairs, and potentially damaging effects to their company due to negative publicity.

Wirescan’s patented LIRA Technology has been successfully used for fault location and condition monitoring of electrical power cables in all corners of the world since 2005.

Since it’s infancy in the Nuclear Power Plant domain, it has been developed and successfully applied by other industries such as Offshore Wind Farms, Cable Manufacturers, Transmission and Distribution,

Offshore oil platforms are increasingly receiving their power from shore via subsea power cables and Oil & Gas Production. Wirescan is also developing market oriented solutions for electrical power transmission that will allow for on-line monitoring, and monitoring of energized cables thus lowering the cost of implementing state-of-the-art cable condition monitoring.

The LIRA (Line Resonance Analysis) technology is based on the Transmission Line Theory, through analysis of the complex line impedance (amplitude and phase) as a function of the applied signal frequency. It enables detection of degradations in the cable insulation.

The future offshore will include a subsea power grid 30 • Oil and Gas Innovation

Subsea structures with pumps and valves needs power to operate

Services Offered Power Cable Assessment and Power Cable Fault Location Wirescan offers the most accurate cable fault location technology on the market, with a proven accuracy of the test equipment ensuring fault location within 0.3% of the cable length. The equipment is capable of measuring all kinds of electrical cables ranging from less than 50 meters to several hundred kilometers, without any danger of damaging the cable. The LIRA test method is non-destructive, and sensitive to even small cable degradations and defects.

Products Offered LIRA Portable The LIRA Portable is the proven test equipment used by Wirescan in service missions in the harshest environments. It features are: Sensitive to small degradations and cable defects Accurate location of cable degradations/defects Applicable to a wide range of cables and wires Applicable on multi-segment systems with different cable types Non-destructive and non-intrusive

Wirescan’s patented LIRA Technology has been successfully used for fault location and condition monitoring of electrical power cables in all corners of the world since 2005.

Only one access point needed for measuring Fast and easy connection to test object Recording and playback for post analysis Detection of multiple faults/ damages/failures, and their severity Pre-study/simulation of cable data and defects

31 • Oil and Gas Innovation

CONTACT DETAILS Wirescan AS

Kveldroveien 7 N-1407 Vinterbro, NORWAY www.wirescan.no email: info@wirescan.no Contact one of our sales representatives: Snorre Tangen, Sales Manager Oil & Gas Ph: +47 945 20 225 Vidar Bergli, VP Sales Ph: +47 959 39 500 Cable Condition Monitoring Wirescan offer cable condition monitoring services to enable the clients to avoid time consuming and costly cable breakdowns and repair operations. Through the first measurement on a cable in operating condition, customers establish a cable “fingerprint” that subsequent measurement values can be compared to in order to assess the development of cable degradations and/ or damages over time. Thus, the client can get an “early warning signal” to help guide the maintenance plan and the maintenance budget. This also significantly reduces the overall risks impacting on the clients operations. Offshore Power Cables are costly assets and should be protected and monitored using the best possible technology available.

Wirescan’s LIRA Technology is the obvious choice. •

E &P

Morocco Operations Update Gulfsands Petroleum plc (“Gulfsands”, the “Group” or the “Company” - AIM: GPX), the oil and gas production, exploration and development company with activities in Syria, Morocco, Tunisia, Colombia and the U.S.A. provides the following update on activities underway in Morocco.

The first phase of drilling operations on the Company’s Rharb Centre Permit, comprising the drilling of four commitment shallow gas exploration wells, commenced on the 23rd October 2013, using the recently imported COFOR SAS Cabot 750 drilling rig.

These exploration wells are part of a nine well commitment inherited with the acquisition of Cabre Maroc Limited in January of this year. This first phase of exploration wells have been designed to test distinct Miocene-aged sandstone reservoirs located at depths between 750 and 1600 metres vertical depth below ground level. These exploration targets have been identified from limited legacy 2D seismic data.

A further five commitment gas exploration wells comprising the second phase of operations will be drilled during 2014 on the Rharb Centre Permit.

These wells will be located with the benefit of a recently completed 220 square kilometre 3D seismic survey (see Seismic Operations below).

Operations have now been completed on two of the four wells that represent the first phase of our nine well commitment programme. Both wells were drilled within time and budget expectations.

The Al Krima 1 well (“AKR-1”) was drilled to a total vertical depth of 1613 metres Measured Depth Below Rotary Table (“m MDBRT”) over a period of 21 days. Three significant sand bodies were encountered within the well at depths of 1141, 1410 and 1477 m MDBRT. However, in spite of gas shows being observed during the drilling of these sands, all sand units were subsequently evaluated to be predominantly water bearing, each containing an average gas saturation of less than 10%. Accordingly, AKR-1 was plugged and abandoned as a non-commercial gas discovery.

The post drill review of the well result suggests that a gas accumulation may be present up dip of the AKR-1 well location, but that additional seismic data will be required to determine whether sufficient exploration potential exists to justify further drilling in this area.

The Oulad Zid 1 well (“OZI-1”) was drilled to a total vertical depth of 1323 m MDBRT over a period of 22 days. Three sand packages were encountered where strong gas shows were detected whilst drilling. The uppermost package at 1077 m MDBRT was subsequently evaluated from wire line log interpretations to contain gas saturations of 40-45% within a total net pay zone of less than 2 metres. The two deeper sand packages commencing at 1193 m MDBRT comprised a total of 16 metres of net sand of excellent reservoir quality, however these sand packages were evaluated as predominantly water bearing. Following a technical and economic evaluation, it was determined that the OZI-1 gas discovery would not represent a commercially viable operation and therefore the well was plugged and abandoned as a non-commercial gas discovery.

The deeper sands encountered within the well are attractive reservoir targets for future exploration wells. The recently acquired 3D seismic survey covers the OZI-1 well location and will be used to more fully evaluate the extent and exploration potential of these deeper sands.

The rig will now move to the Beni Fdal 2 (“BFD-2”) location, where a vertical gas exploration well will be drilled to 970 m MDBRT to test a significant channel feature identified on 2D legacy seismic data. BFD-2 is located 250 metres away from the 2006 Beni Fdal 1 exploration well, which did not intersect the channel feature but proved the existence of gas at the target horizon depth.

Acquisition of a 3D seismic survey, covering an area of approximately 220 square kilometres over the highly prospective south-western portion of the Rharb Centre Permit has been completed and the data are currently being processed prior to interpretation. A “fast-track” processed volume of data is expected to be available in January 2014, with final data delivery near the end of Q1 2014. These data were acquired over an area containing numerous structural features and seismic amplitude anomalies identified on legacy 2D seismic data. It is expected that the new 3D seismic data will be of great assistance in selecting future exploration well locations for the second phase of drilling and beyond.

The Fes 2D seismic programme, designed to acquire approximately 650 kilometres of 2D data on the prospective Fes permit, is ongoing and is anticipated to be completed, subject to continued suitable weather conditions, early in 2014. These data will be integrated with existing legacy seismic and full tensor gravity data in order to select a suitable prospect for exploration drilling for light oil.

Mahdi Sajjad, the Company’s CEO commented: “I am very pleased that our management has successfully met the challenge of completing these two wells in this first four well phase of our commitment well programme, thereby enabling us to meet undertakings to the Morocco government inherited in our acquisition of Cabre Maroc Limited in January of this year.

We are encouraged to have confirmed the presence of gas in both wells, albeit in sub-commercial quantities, in wells which were located using legacy 2D seismic data or modest quality and clearly inferior to the 3D seismic data captured in our recently completed programme and which will be used for the location of the five commitment wells to be drilled in the first half of next year. With the steep learning curve involved in drilling these wells now behind us and 3D seismic data soon to be available for locating the wells in the rest of our commitment well programme, we are optimistic for the prospects of building a successful commercial gas sales business in Morocco.”

This release has been approved by Jason Oden, Gulfsands Vice President: Exploration who has a Bachelor of Science degree in Geophysics with 28 years of experience in petroleum exploration and management and is registered as a Professional Geophysicist. Mr. Oden has consented to the inclusion of the technical information in this release in the form and context in which it appears. • 32 • Oil and Gas Innovation

13th Georgian International

OIL & GAS

Infrastructure and Energy Conference

26–27 March 2014

Tbilisi • Georgia Radisson Blu Iveria Hotel

www.giogie.com

The Regional Event for a Global Industry

Tel: +44 (0) 20 7596 5004 Email: og@ite-events.com London • Moscow • Almaty • Baku • Tashkent • Atyrau • Aktau • Istanbul • Hamburg • Beijing • Poznan • Dubai

TRANSPORTATION & LOGISTICS

American Companies Team up to Take Advantage of Shale Boom in Midwest Plays General Partner of Summit Midstream Partners, LP to acquire interest in Utica Shale Gathering system in southeastern Ohio from Blackhawk Midstream DALLAS, Dec. 20, 2013 // Summit Midstream Partners, LLC (“Summit Investments”), the privately held company that owns and controls the general partner of Summit Midstream Partners, LP (NYSE: SMLP), announced today that it has executed a definitive agreement with Blackhawk Midstream, LLC (“Blackhawk”), to acquire its equity interest in two entities, Ohio Gathering Company, L.L.C. and Ohio Condensate Company, L.L.C. (together, “Ohio Gathering”). Ohio Gathering owns, operates and is developing significant midstream infrastructure in southeastern Ohio consisting of a liquids-rich natural gas gathering system, a dry natural gas gathering system and a condensate transportation, storage and stabilization facility in the core of the Utica Shale play.

Ohio Gathering Company, L.L.C. is currently owned by (i) MarkWest Utica EMG, L.L.C. (“MarkWest Utica EMG”), a joint venture between MarkWest Energy Partners, L.P. (“MarkWest”) and the Energy and Minerals Group (“EMG”), and (ii) Blackhawk, a joint venture between Gulfport Energy Corporation (“Gulfport”) and Wexford Capital LP. Ohio Condensate Company, L.L.C. is currently owned by (i) MarkWest Utica EMG Condensate, L.L.C. (“MarkWest Utica EMG Condensate”), a separate joint venture between MarkWest and EMG, and (ii) Blackhawk. The purchase of the equity interests in Ohio Gathering will be fully funded by Summit Investments and its sponsors. The transaction is expected to close by January 31, 2014.

The equity interests to be acquired by Summit Investments include an option to increase its ownership interest in Ohio Gathering to 40.0% at any time prior to June 2014 at a price based on the capital invested by the owners at the time the option is exercised. Summit Investments expects to fully exercise the option in the second quarter of 2014. Upon exercise of the option by Summit Investments, each of MarkWest Utica EMG and MarkWest Utica EMG Condensate will retain its respective 60.0% ownership interest in Ohio Gathering and will continue to operate and develop the gathering infrastructure. Summit Investments intends to offer all or a portion of its interest in Ohio Gathering to Summit Midstream Partners, LP following the exercise of the option and the subsequent development of the assets.

Ohio Gathering is supported by fee-based gathering agreements and acreage dedications from producer customers that are actively developing Utica Shale positions throughout Harrison, Guernsey, Belmont, Noble and Monroe counties in Ohio. Ohio Gathering’s customers currently include Gulfport, Rex Energy Corporation, PDC Energy, Inc. and other leading producers in the Utica Shale play. Ohio Gathering’s liquids rich gathering system serves as a critical inlet to MarkWest Utica EMG’s Cadiz and Seneca processing complexes, the largest integrated rich-gas processing and fractionation facilities in the Utica Shale.

Steve Newby, President and Chief Executive Officer of Summit Investments commented, “We are excited to announce an expansion of Summit’s relationship with MarkWest, which has developed an industry leading midstream infrastructure position in the heart of the Marcellus and Utica shale plays. We are equally excited about our new relationship with Gulfport, the anchor shipper on Ohio Gathering, which is one of the most active producers in the Utica with over 147,000 net acres under lease in the most prolific part of the Utica Shale.”

“Our participation in Ohio Gathering will significantly increase our scale and further diversify our cash flows from a customer and geographic standpoint while maintaining our focus on providing fee-based midstream services under long-term contracts. This transaction provides Summit Investments with an immediate and large-scale presence in the core of the Utica Shale play, where Ohio Gathering anticipates developing more than $3 billion of midstream infrastructure over the coming years. The acquisition and subsequent development of Ohio Gathering will substantially increase the inventory of assets available at Summit Investments to be offered to SMLP.” About Summit Midstream Partners, LLC Summit Midstream Partners, LLC is a growth-oriented midstream energy company focused on owning and operating midstream energy infrastructure assets that are strategically located in the core areas of unconventional resource basins, primarily shale formations, in North America. Through its ownership of (i) Summit Midstream GP, LLC, the general partner of Summit Midstream Partners, LP; (ii) a 71.6% limited partner interest in Summit Midstream Partners, LP; (iii) Red Rock Gathering Company, LLC; and (iv) Meadowlark Midstream Company, LLC, Summit Investments provides primarily fee-based natural gas gathering, treating, processing, and compression services, as well as crude oil and water gathering services supporting some of the largest oil and natural gas exploration and production companies in North America. Summit Investments has operations in the Piceance Basin in western Colorado, the Uinta Basin in eastern Utah, the Williston Basin in northwestern North Dakota, and the Denver-Julesburg Basin in northeastern Colorado. Summit Investments is headquartered in Dallas, TX with offices in Houston, TX, Denver, CO and Atlanta, GA. • 34 • Oil and Gas Innovation

TRANSPORTATION & LOGISTICS

OGI Talks Modules With the Ferguson Group The Ferguson Group, specialists in the rental of DNV 2.7-1 / EN 12079 certified offshore containers, refrigeration/freezer modules, workspace modules and accommodation solutions to the global offshore energy industry, is continuing to set new standards for outstanding service by supplying accommodation complexes and modules to suit the requirements of customers.

Headquartered in Aberdeen, Ferguson Group was established in 1976 to service the container and accommodation demands of companies in the North Sea oil and gas industry. Today the Group employs over 200 people at its offices and facilities in the UK, Norway, Australia, Singapore and UAE. The Group is constantly increasing its international presence and works closely with strategically aligned partners located around the world including Brunei, East Timor, East and West Africa, India, Indonesia, Kazakhstan, Kristiansund, Libya, Malaysia, Malta, New Zealand, Philippines, Russia, Trinidad and Victoria, allowing the products to be offered to an even further range of markets.

Photo courtesy of Woodside Energy Ltd

Accommodation and Workspace Modules Ferguson Group’s module range contains several designs for offshore accommodation modules along with workspace modules including offices, laboratories, test cabins, MWD and LWD cabins, mud logging cabins, coffee shops, tea shacks and workshops.

Ancillary modules such as recreation rooms, gymnasiums, locker rooms, galley/ mess rooms, laundry rooms and medic suites can be supplied to supplement larger accommodation complexes.

Standard accommodation modules are available in 10.3m, 7.6m and 6m sizes while the standard workspace modules are available in 10.3m, 7.6m, 6m, 4.8m, 4.5m and 4m sizes. Modules can house between 1 – 8 POB (persons on board), depending on internal layout. These fit-for-purpose high quality units can be further adapted to suit specific requirements and they offer an attractive alternative to fully bespoke modules for a wide variety of applications with a fast turnaround from order to delivery.

The modules are designed to make hookup and commissioning straightforward and quick.

Whether individual or multiple units, the design and construction to DNV standards enables engineers to install the units in the shortest possible time.

35 • Oil and Gas Innovation

Dedicated to offering a flexible and personal service, Ferguson Group listens to the market and its customers, which has resulted in high quality, innovative products that improve the safety, comfort and efficiency of those working in the oil and gas sector.

The Group recently announced a new product, the new 6m accommodation module, that is specifically designed for customers working in southern hemisphere conditions and offering a safe and comfortable living space for four personnel through the development of a new internal fit out, an attractive and relaxing interior and dual or individual air-conditioning systems with individual thermostatic control.

The interior of the 6m Dual Zone Refrigerated Module

precise specifications using the range of units available. The complex can be built by stacking the required modules, linking them with hallways and/or stairways to form a large and robust accommodation complex.

The modules are designed to make hookup and commissioning straightforward and quick. Whether individual or multiple units, the design and construction to DNV standards enables engineers to install the units in the shortest possible time.

With an increase in upgrade and maintenance work being carried out Ferguson Group has been offering its services to major oil and gas companies around the world. One of Ferguson Group’s contracts included a 48 person accommodation complex complete with office and medic modules, as well as a galley and food store module for the Angel platform in the North West Shelf of Australia.

All modules were fitted with en-suite facilities including under floor heating in wet units, desk and seating areas, two sets of bunks and high quality fittings and fixtures. All cabins were fitted with advanced integrated split HVAC systems and a PLC (Programme Logic Control) fire and gas detection system.

The interior of the new 6m Accommodation Module Focused on the continued innovation and evolution of its module range, another recent product to be launched is the Group’s new 6m dual zone refrigerated/chiller module from IceBlue Refrigeration Offshore, a specialist in providing refrigeration and freezer solutions and a member of the Ferguson Group.

Following extensive market research, the new product was developed to offer a flexible solution, in one module, for transporting a range of perishable foodstuff that requires specific storage conditions. Capable of providing cooling in either a single or dual zone compartment simultaneously in a -30oC to +20oC ambient temperature range. The IceBlue 6m dual zone refrigerated/chiller module provides temperature control for transportation and storage, suitable for use in a range of climatic conditions.

Quality: Standards and Certification All modules are designed and built in-house to DNV 2.7-1 and EN 12079 standards and to a range of certifications to support various markets.

With rigorous control over the production

process, Ferguson Group can guarantee the quality of the end product and delivery to schedule. The manufacturing process operates to the highest industry standards, providing customers with the reassurance that they are using modules that comply with the latest HSE regulations. The company is committed to HSEQ, and has received ISO 9001, ISO 14001 and OHSAS 18001 accreditation.

Investment in the Middle East With the emergence of new demand in the Middle East, Ferguson Group embarked upon ambitious growth plans to extend the product offering in the UAE. The Group’s latest investment has been the launch of new company divisions in the Middle East, with Ferguson Middle East FZE based in Dubai and Ferguson Group LLC in Abu Dhabi.

The new divisions have allowed the team to build upon the high levels of product demand previously seen in the Middle East, and further enhance international reach whilst retaining a localised, on the ground service for clients in the region.

Mike Melville, Commercial Director at Ferguson Group said: “Having our own company base, or an agent, in each of our key global markets allows us to offer every customer the same high quality products, short lead times and first class support that our strong client base has grown to rely on.” •

Offering a built-in easily moveable partition to convert the dual zone module from a single to a dual compartmentalized module with an independent controller that is configurable to separately regulate the temperature.

Accommodation Complexes Depending on client requirements, Ferguson Group’s range of A60 modules can be provided as standalone or can be linked and stacked (up to four high) to form multi-module complexes.

CONTACT DETAILS

The Ferguson Group Tel: +44 (0) 1467 626500 E-Mail: info@ferguson-group.com

An entire complex can be constructed to 36 • Oil and Gas Innovation

HEALTH, SAFETY & ENVIRONMENT

Why Your Safety Managers Could be Doing More For Your Business Than You Realise.

The success of safety improvement in the last 20 years or so has valuable lessons for other aspects of the organisation. Dealing with quality issues, slippage of project costs and schedules, and how to foster innovation to compete with other businesses are all areas ripe for the deliberate application of safety thinking.

Where are we now?

Behavioural Safety and Safety Culture are now familiar concepts to a wide range of organisations across a variety of sectors with the need to manage high-risk operations: aviation, nuclear, chemical, pharmaceutical, construction and infrastructure have all embraced the thinking and techniques that go with it. The results have been impressive.

The aviation industry, as just one sector example among many, achieved a rate of 0.2 fatal accidents per million departures in the US in 2008 according to the Flight Safety Foundation, and is still on a downward trend - a vivid illustration of the reliability that can be achieved, and a great comfort to those of us who fly frequently. When accidents do occur, they are explainable in behavioural and cultural terms, and investigations frequently reveal the failure to apply known remedies, thus confirming the validity of behavioural and safety cultural approaches.

Particularly driven by the Piper Alpha disaster of 25 years ago, the oil and gas industry has been a generous commissioner of academic

research to understand the fundamental nature of the issues, and a frequent leader in the practical implementation of tools, techniques and policies to underpin safe operations. We have now reached a happy state in oil and gas where a generation of managers have grown up immersed in safety culture thinking, and where statistics have demonstrated that an offshore oil and gas worker is less likely to be injured than a worker on the mainland of Scotland.

Understanding success - how did we get here?

The understanding and skills required for safe operations have even risen to the paradoxical challenge that, as operations are made intrinsically safer through analysis of failures, actual accident rates fall. As a result, the supply of ‘fresh’ accidents to learn from dwindles. Encouraging the reporting of, and focusing on the analysis of, incidents and near misses, has continued to contribute to understanding how to identify risk and better define the envelope of safe operation.

37 • Oil and Gas Innovation

The big picture is an undeniable success story and the understandable tendency is to then shift the focus to other areas of the business that might be generating ‘pain’. We can leave our safety managers to continue their relentless pursuit of the management of risk and let them keep up their guard against the demon of complacency, secure in the knowledge that things are moving in the right direction. Attention can be given to the other things that also routinely trouble the organisation: quality issues, slippage of project costs and schedules, and how to foster innovation to compete with other businesses.

So what?

But hang on a minute, if the safety function has been so successful, do we fully understand why it has been so effective and could some of that learning be transferable? Could it be successfully applied to those other sources of organizational pain? After all the effort and investment over the years, could we get back even more than the current hard-won prize of improved and robust safety performance?

To answer that question let’s take a look at a familiar model in safety thinking: Organisational Safety Culture Maturity. In its original form it proposed three ‘cultures’ or stages of maturity (later developed with oil and gas industry involvement into a more sophisticated five-stage model). It’s interesting food for thought.

Stage 1 Pathological This is an organisational culture that actively contributes to accident and injury through an unbalanced emphasis on getting the job done, ducking responsibility, suppressing information, penalising those who speak out, hiding failure, discouraging ‘bridging’ (intersilo, and inter-hierarchical level relationships and coordination), and resisting new ideas.

Stage 2 Bureaucratic This is a culture that attempts to address the obvious dangers and deficiencies of Stage 1 but does so in a clumsy and proceduralised fashion. A pure task-focus is countered by the development of procedures about how a task is performed, responsibility is identified and allocated narrowly, information is gathered but may be left unanalysed, there is greater tolerance of questions and dissent, failures are judged to apportion blame, bridging is allowed but not positively encouraged, new thinking is seen as a problem to be managed.

Safety managers could be agents of change for other areas of the business

‘If the safety function has been so successful, do we fully understand why it has been so effective and could some of that learning be transferable? Could it be successfully applied to those other sources of organizational pain?

Stage 3 Generative This is a culture in which safety and other considerations are integrated into the task, information is actively sought and provided for its recognised value (an ‘informed’ culture), responsibility is shared (a ‘just’ culture), people are trained to analyse and question, failures trigger a deeper level of inquiry to appreciate root causes, bridging is rewarded or even integrated into the way of doing things, new thinking is welcomed and generates improvement.

People who encounter the model recognise their organisation’s culture in it, its present state, where it has come from in the past, and how it compares to other organisations they have experienced. From this basis it then has real power to challenge what is happening and suggest a route to improvement.

Beyond safety Part of the power of this model is in its validity as a descriptor of organisational development.

If this model has been a part of successfully driving safety thinking in the past 20 years or so, how could it be applied to some of those other sources of organisational pain?

Let’s take a Quality scenario (with the ‘bundling’ of HSQE expertise this is not too great a stretch of the imagination): a recurring defect rears its head and comes under investigation.

What would an experienced, behaviourally and culturally aware safety manager do?

The development of safety culture has been down this route many times and has obvious parallels in accident investigation and near miss reporting, which also seek ultimate root causes. Safety has succeeded through focusing on accurate information gathering, working on the relationship with the operators to encourage them to be open with the information they hold so that real issues can be addressed. In addition, the negative consequences of information-sharing have been reduced by consultation in developing a ‘just’ culture where people know that management use the information in a fair, consistent and proportionate way. These two approaches ultimately combine to develop an informed culture where people know the boundaries of acceptable operation and can share expertise to design realistic actions to make sure they are not crossed.

Beyond HSQE Project management is well known as the black art that exists between the cost and schedule optimism of the sales team and the harsh realities and mounting pressures of delivery. A common scenario is one in which a project appears to be progressing well but is starting come adrift from its schedule or budgeted cost. The reasons may be many: unrealistic aims to start with, late changes of spec, procurement difficulties, unanticipated technical difficulties, that is to say external causes, not bad management.

The danger that projects become locked in a recurring pattern of pathological and bureaucratic behaviour is a real one, but the bureaucratic action of simply raising a multitude of variations must be avoided.

Rather than fighting each other to a standstill, what if the leaders took a leaf from the safety handbook and asked what would it take to move closer to the generative culture? Only early sharing of information likely to result in delays and knock-on effects, and involvement of the client, will avoid surprises and enable working together to achieve the best possible project outcome. Some battle-hardened project managers might object that

this is naïve and stick to a manipulative and adversarial approach, but this is territory long abandoned in safety thinking - proof that it is possible to break the paradigm.

What about innovation?

In most cases innovation is not the single great leap forward or game-changing technology.

For most businesses, most of the time, it is the almost imperceptible daily grind of evolving their product, services or processes to enable them to compete by learning to do more for less, or developing other added-value offerings aligned with their core expertise and existing markets.

In the safety culture model the clearest differences between the stages are in how information is handled in each culture.

Consideration of the generative culture in action makes it clear that this stage is going to be the most likely to deliver those competitive innovations. It is the only stage that fosters the sharing of knowledge and experience necessary between the levels and departments of the organization - where a truly informed culture can grasp the needs and share the part-solutions that in sum drive the required evolution.

Summing up The success of safety improvement in the last 20 years or so has valuable lessons for other 39 • Oil and Gas Innovation

aspects of the organisation: quality issues, project slippage and competitive innovations are all areas ripe for deliberate application of safety thinking. Even if they don’t use the same terminology, aspire to Wemost workbusinesses to help project a generative culture.

In teams their safety culture and bid succeed. they may already have an operating model We develop people awaiting further exploitation of its potential. and business leadership.

We has improve Perhaps the time comebusiness to accept that performance in managers the skills and experiences of safety nuclear are the skills andinfrastructure, experiences that will take and in construction. companies forward future. Perhaps the next generation of CEOs will have safetyJustgeneralist think what specialists turned in weits ranks. could achieve you.

To those who say “Never!” wefor say, “Which culture do you represent?” •

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PIPELINE, REFINING & PROCESSING

Product Spotlight: Instrument Air Compressors and Dryer Package Granzow is a leading supplier for the industry of screw compressors, compressed air treatment, energy friendly compressor controls.

They also produce a complete range of automation products, such as bursting discs, bursting panels, fittings, thermostats, valves, pneumatic cylinders. An extensive program of efficient pumps as high pressure pumps, diaphragm pumps, hose pumps, mobile pumps. Complete line of vacuum pumps, measurement equipment, leak detection systems and sputter systems.

For the Offshore industry, the Instrument Air Compressor & Dryer Package is an essential technology in terms of the reliability for the continuous operation of machinery working on the platforms.

These packages have been built in the past to fulfill – f.ex. EEx e IIT1 or T3 – standards. Today the certification will be in accordance with both the ATEX regulations, Zone II or Zone I. Many packages have been evaluated to a be delivered as a complete build in package, with an air fresh water cooled compressor and a heatless adsorption dryer, controlled by a dew point control and the necessary inlet and outlet filters. This results in a compressed air quality in accordance with ISO8573-1 : Particles CLASS 1 Water content CLASS 2 Rest content of oil CLASS 1

less than 0,1 micron dew point – 40 degr.C ( 0,12 g H2O/m3) 0,01 mg/m3 Surface treatment

40 • Oil and Gas Innovation

Container with a heatless dryer

Today the certification will be in accordance with both the ATEX regulations, Zone II or Zone I.

Package leaving our factory after FAT

The compressed air will then be able to be used as air suitable for breathing, if each person has a small filter unit before his actual use of the air before his reduction valve. The illustrated container plant, has a 132 kW, 10 bar air compressor mounted inside the container, followed by a heatless low temperature adsorption dryer, which guarantee the user the quality described previously. The electrical control panel is mounted in the container, this means that electrical offshore cables do not have to used inside the compressor or dryer.

The compressor power cable can be standard cables, as the nature of the offshore cables in terms of dimension and flexibility, do not match the mounting inside the units.

The container version as shown, has features which complicate the stainless steel container.

The container does have to be designed and calculated for offshore lifting. This can be a challenge for the factory which fabricates the container. Certification on all material used, WEP and WPS, NDT procedures, structural design calculations, structural detail drawings and lifting equipment calculations follow the correct weighing procedure. Single line electrical diagrams for control panels, air compressor and dryer and instrument data sheets can all to be accepted by, or under a FAT in our test bed. Additionally, the package had to be used in a hazardous area, thus making the door construction a challenge as well. The lubricated air compressor will work with a capacity (in accordance with ISO1217) of 1260 m3/h at designed outlet pressure of 10

bar.g. The total capacity through the outlet compressed air pipe will then be 1075 m3/h – at 85 % load and 9.5 bar working pressure, calculated with a pressure drop over dryer and filters, to approximately 0.5 bar.

The heatless dryer uses compressed air for regeneration, the outlet compressor capacity has to be deducted the regeneration capacity – a difference between 1260 and 1075 m3/h.

This design, for heatless dryers, gives the user a simple reliable low temperature dryer function.

The alternative adsorption dryer, with heat regeneration work with temperatures up to 180 degr.C - from the heating elements in the dryer vessels, for this capacity – total 15 kW. For reasons regarding temperature the heatless dryer is the preferred choice in this situation.

The dryers will always be mounted with a dew point control, with the purpose of securing the user the right dew point. The signal 4/20 mAmp to SCADA – further this control will reduce the power, kW or compressed air, in proportion with the flow through the actual dryer. In total this container version only has one inlet electrical gland connection, one compressed air outlet and two cooling water connection. Therefore the package when accepted under the FAT, which will be ready to be started up when placed on the platform. • This article was written by: T.S.Mortensen, Mechanical Engineer B.Sc, Granzow, Denmark www.granzow.dk

PIPELINE, REFINING & PROCESSING

The Importance of Monitoring Internal Corrosion in Oil and Gas Pipelines Explained Internal corrosion monitoring in oil and gas pipelines is a requirement in many jurisdictions for a number of reasons. There can be regulatory requirements related to public safety, internal corporate policies related to infrastructure maintenance, and analytical based projects for understanding of process or operational changes and their impacts to the pipeline infrastructure.

Corrosion Pitted Strip Style Weight Loss Coupon

An understanding of the specific mechanism, or mechanisms, of corrosion in oilfield pipeline systems is necessary in order to properly design and implement an appropriate mitigation strategy. While it may be possible to apply broad mitigation strategies without understanding the mechanism, it is more cost effective to direct specific strategies to specific internal corrosion mechanisms.

Monitoring for internal corrosion in oil and gas pipeline systems requires a complimentary approach of several methods in order to identify the mechanisms responsible for corrosion. Like most investigative methods, there are methods that are strong in one manner, and weak in another. The most representative and accurate picture of the corrosive environment is identified by multiple methods.

There are many direct and indirect methods, and intrusive and nonintrusive methods that

can be utilized. The most typical methods for internal corrosion monitoring are weight-loss corrosion coupons, electronic monitoring (ER, LPR, Galvanic, and ECN probes), water analysis, Fe/Mn analysis, solids analysis, and bacterial analysis. Supplementary and additional complimentary methods can include ultrasonic testing, ILI runs, and radiographic testing. All of the aforementioned methodologies are valid instruments for the evaluation of internal corrosion. However, when used in a complimentary manner with one another, they can provide an accurate depiction of the corrosion process at work within the pipeline system. Increasing the understanding of the internal corrosion mechanism, will enable a better design of the mitigation strategy.

One of the most under-utilized methods for internal corrosion monitoring are weight-loss corrosion coupons. While they may be the method with the greatest deployment, the 42 • Oil and Gas Innovation

actual information obtained from them has been historically limited to the measurement of a General Corrosion Rate and a Pitting Corrosion Rate. While these are valid measurements, they are certainly not the entire story.

Weight-loss corrosion coupons should be thought of as an information gathering platform within the pipeline system. For instance, the exposed surface of the weightloss corrosion coupon can provide a wealth of information related to internal corrosion mechanisms. Because a properly placed weight-loss corrosion coupon should be in a representative location and position within the pipeline, the information obtained from the exposed surface should be representative of the pipeline operating condition.

Dependent on the position of the coupon within the pipeline system, and the position with respect to the pipe wall, an evaluation

of the current mitigation strategy can also be completed. For example, a weight-loss corrosion coupon placed at the 6:00 position and flush with the pipe wall can provide valid measured evaluations of any pipeline pigging mitigation, or corrosion inhibitor applications (batch, slug, or continuous).

The approach should be to gather as much evidence as possible from the exposed surface. Surface analyses can include an in depth examination of the solids present.

Typical testing of solids has commonly included X-ray Diffraction (XRD) methods, which can provide elemental analysis related to corrosion by-products. Further testing can also include CHNS, ICP, and FTIR methods.

Further testing can also be completed to include sessile bacterial swabs (serial enumeration via dilution methods) or SEM analysis of bacterial microstructures.

If the weight-loss corrosion coupon surface has also been exposed to a mitigation strategy, then the results of the complimentary testing from coupon surface are also being evaluated.

In fact, if the coupon surface has been placed at the pipe wall, it may be possible

When it comes to internal corrosion monitoring on oil and gas pipelines, a good analogy to use is the human body. When the body is sick (for example – corrosion processes), a doctor will perform diagnostic tests and evaluate these tests in conjunction with the observed symptoms.

to determine the amount of any corrosion inhibition products that have been applied to the pipeline system – providing additional forensic information relative to that specific mitigation strategy.

In addition to the analytical methods discussed, there is also valuable information that can be obtained from visual observations of the coupon at the time of removal from the pipeline system. The presence of mineral precipitate (mineral scales), or hydrocarbon precipitate (paraffin, wax, asphaltene) on the surface can also be evidence in relation to under deposit corrosion activities. All of this, just from the surface of the lowly weight loss corrosion coupon.

Prior to removal of the coupon from the system, the type of coupon holder used may also provide a liquid sampling source.

Liquid sampling of flowing pipeline systems is considered to be more representative than sampling from relatively stagnant water sources such as tanks and separators. .Water analysis can provide relevant data related to dissolved acid gases (H2S,

Weight Loss Corrosion Coupon Pit Morphology

43 • Oil and Gas Innovation

(H2S, CO2, O2), pH, temperature, bicarbonate concentrations, and anion/cation quantities – all significant clues when evaluating the corrosion potential and possible corrosion mechanisms of the produced water electrolyte. Samples can also be obtained and preserved for Fe/Mn concentrations. Fe/Mn concentrations, when taken into account with the water volume in the pipeline system, can be a valid indicator of corrosive activities for certain pipeline systems.

So there is still value in the simplest and most common method of internal corrosion monitoring. There is an abundance of corrosion mechanism clues that can be measured from this type of monitoring platform.

Once the value of internal corrosion monitoring has been accepted, the most common questions asked are where should monitoring be located, and how often should it be completed. There are many methods to determine where monitoring should be located, and these methods have increasing sophistication and associated costs. Regardless of the method chosen, consideration should be given for the probability of corrosion and the consequence of a failure.

When it comes to internal corrosion monitoring on oil and gas pipelines, a good analogy to use is the human body. When the body is sick (for example – corrosion processes), a doctor will perform diagnostic tests and evaluate these tests in conjunction with the observed symptoms. Many times,

samples will be drawn from the body. Imagine if no diagnostic testing could be performed, yet a medicine (mitigation) was prescribed without all of the information. A more realistic analogy between pipeline systems and the human body would be if a medical practitioner were only allowed a select few diagnostic methods, and those methods were only able to be performed on a few sites on the body. It becomes abundantly clear that access to the affected area of the body will provide the best medical care for that part of the body.

The same can be said for pipeline systems.

While not all monitoring locations within the system necessarily require constant and rigid monitoring, many points within the system require the potential for monitoring.

Monitoring can be like a physical examine on the body. It does not need to happen every day, but it should happen on a regular schedule in order to find a problem, before that problem manifests itself into a disaster.

If you don’t look for corrosion, you will never find it until it is too late. •

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CONTACT DETAILS

Rysco Corrosion Services Inc www.ryscocorrosion.com Tel: +1 877 899 5988 E-mail: info@ryscocorrosion.com

44 • Oil and Gas Innovation

Technology Design Ltd specialises in the design, manufacture and supply of high performance ultrasonic NDT systems.

Whether inspecting for corrosion, erosion or weld defects and material degradation of all types, our continued commitment to improvement ensures that our products help you remain ahead of the competition.

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