Tank Storage Magazine v05 i01


Volume: 5
Issue: 1
Date Published: January 1, 2009



How can I improve terminal efficiency?

The terminalling industry will not escape the pains of this new business environment. With credit facilities all but disappeared and the price of oil continuing to fall, the short term future for the industry holds many uncertainties. A huge armoury of improvement methodologies, techniques and tools exist to enable organisations to take a hold of their current performance and scientifically identify root causes of the underlying problems, propose solutions and test the effectiveness of such solutions. We have all heard the terms TQM, Six Sigma and Lean, but few, especially in the terminalling industry, truly understand how they can help us to improve. Underpinning any performance improvement initiative is the requirement for terminals to understand performance in comparison to its peers. By comparative measurement of their performance in relation to others in their industry, a terminal can identify its strengths and weaknesses, and determine any gaps in performance to the industry leaders. Monetary values can be placed in those gaps, and this information used to prioritise their improvement efforts as well as seeking opportunities to learn from the best practices of terminals identified as industry leaders (best in class performers). This structured step by step approach is called benchmarking, and culminates in a clear picture of what must be done to improve. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

The upside of the economic downturn

Not everyone sees a recession as a reason to despair Over the last few years financial players all around the globe have been increasingly eager to get their hands on storage facilities, which are seen as an invaluable long term investment, and this in turn has been driving up prices. Challenger Financial Services, for example, a leading investment, mortgage, funds management and financial services group in Australia, has interests in 14 terminals, including UK-based Oikos purchased in February 2007, and LBC, acquired in June 2007, which owns 12 terminals. Subsequently, LBC also acquired a 90% stake in GEP Asia Terminals (GAT) in September 2007. But now, following the global credit crisis, many investors are finding it difficult to get sufficient financial backing, so more opportunities are opening up for terminals to expand. Some companies are also feeling the effects of tightening conditions, so there are more storage assets up for sale, and prices are coming down. Vopak's CEO John Paul Broeders has seen private equity interest in storage facilities taper off, but says interest from infrastructure funds with a long term vision has remained robust. 'The current credit crisis is obviously having an impact on the availability and cost of capital worldwide,' says Emil Pahljina, executive director of infrastructure at Challenger. 'Neither financial or trade participants in the bulk liquid storage industry will be immune from the current state of global markets. 'However the industry has very attractive fundamentals and as such continues to attract interest from a diverse range of potential new investors including financial investors with longer term investment horizons.' To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

ISO and API differ on flame arrestor guidance

The new ISO standard states that a flame can propagate through a PV valve and into the vapour space of a tank. The standard also states that ignition of a PV valve's relief stream can result in a flashback to the pressure valve with sufficient overpressure to lift the pallet and allow the flame to enter the vapour space of the tank. In line with API 2000 from the American National Standards Institute, the current edition of the Health & Safety Executive's HSG 176 document recommends that 'A flame arrestor is not generally considered for use in conjunction with a pressure valve, because, even at low settings, the gas efflux velocity exceeds the flame speeds of most hydrocarbon gases'. In light of the considerations outlined in ISO 28300:2008 (E) for tanks with potentially flammable atmospheres, however, flame and explosion protection specialist, Elmac Technologies, firmly believes that tank users should err on the side of caution. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Making the best of a bad situation

Vitol Tank Terminal International's CEO talks about the credit crunch and plans to sell its share in Vopak Horizon Fujairah Vitol Tank Terminal International (VTTI) is another global terminal owner and operator making the most of the economic downturn. In hard times steel prices come down, and construction and labour costs are also reduced so it is a prime time to invest and expand. The terminal company came into being in October 2006 when its parent Vitol created this wholly owned group for its various terminal interests around the world. The objective was to expand where needed, acquire new assets and most importantly standardise the health and safety and operating conditions of the various assets. In April 2007 Vitol acquired a majority (90%) stake in the Fujairah Refinery Company Limited (FRCL) in the Emirate of Fujairah, UAE, on the Indian Ocean, just south of the Straits of Hormuz. The other 10% is owned by the Fujairah government. FRCL was built in the mid-90s by a Greek-owned company called Metro Oil, which went bankrupt in 1999. Various entities have been involved in processing and storing oil at the facility over the years. The Government of Fujairah acquired majority control in 2003, and used it as a third party oil terminal up to the time of the Vitol purchase. The terminal now operates with 466,000m3 of storage capacity, mostly in fuel oil and gas oil, but also has the capability to handle crude. The product split at the terminal is today 40% crude, 40% fuel, 15% gasoil and 5% naphtha. The capacity is fully utilised with typical storage contracts lasting three years. Whilst the main customer is Vitol, the terminal also serves several local players. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Capacity expands across the Arabian Gulf

David Hayes looks at the key hubs for storage in the Middle East Tank terminal capacity is expanding at a number of sites across the Arabian Gulf in response to growing demand for liquid fuel and chemical storage facilities. Industrial growth and increased opportunities for hub terminal operators in the region are among the major factors encouraging new investment in storage capacity, much of which is expected to be built by third party tank terminal operators. UAE The planned expansion in storage capacity is largest in the United Arab Emirates (UAE) where major industrial sectors reliant on tank storage are due to grow in the future, including petrochemicals, refining and marine fuel bunkering. Planned developments in refining and petrochemicals will also drive development of tank storage in Oman while Saudi Arabia's petrochemicals industry growth will require more storage capacity in future. Leading international third party tank terminal operators are setting the pace in constructing new storage capacity across much of the Arabian Gulf region. Often working with local partners to facilitate operations, international third party tank terminal operators are looking at opportunities in a number of Middle East countries including some where the independent terminal sector is in its infancy. Fujairah in the UAE is expanding its tank terminal capacity as part of plans to support further development of the petrochemicals sector and expand its role as a logistics hub for petroleum and chemical distribution throughout the Arabian Gulf. Apart from refiners operating their own storage capacity, international third party tank terminal operators with an important presence in the UAE include Vopak, Oiltanking, Odfjell and Chemoil. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Introducing biometrics

US terminals must react to new security legislation imposed by Congress through the Maritime Transportation Security Act of 2002 The Transportation Security Administration (TSA) and the Coast Guard are jointly administering a new identity programme in response to the Maritime Transportation Security Act of 2002 (MTSA) called the Transportation Worker Identification Credential (TWIC). TWIC requires maritime facility operators that are regulated under MTSA to implement increased security measures at their facilities. In general, TWIC is a security measure to ensure that individuals who pose a threat do not gain unescorted access to secure areas of the nation's maritime transportation system. At the heart of the security measure is the TWIC card which must be issued to workers such as port employees and truckers who require unescorted access to secure areas of vessels, outer continental shelf facilities, and to ports and terminals. TWIC cards use smart card technology to store and transmit unique identifiers pertaining to each individual that possesses the card. Information such as biometric fingerprint data, unique card ID, PIN and expiration date are all resident in the card's memory and are used to permit and restrict access to facilities and vessels. Once the final regulations are in place, facilities that fall under TWIC compliance will be required to run security measures to restrict unescorted access to secure zones within their facility. A TWIC card holder will typically perform a onetime registration of their credentials into a maritime operator's Physical Access Control System (PACS). The registration process requires the individual to present their TWIC card to a contact smart card reader. This reader must pass certain credentials resident on the card to the PACS. The PACS will authenticate these credentials to prove the card's validity. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Why terminals need a safety net

Personnel protection comes at a cost: the cost of health, implementation and lost time Safety is not an isolated solution. It is an amalgam of products, deeds and actions. Very often the factors that contribute toward an action being unsafe cannot be attributed to the inadequacy of a single piece of equipment. At the same time, products in isolation cannot make an operation safe. The solution lies with products, often from disparate manufacturers, working in harmony. While thankfully not common, the incidence of falls from tanker tops continues to be a major cause of lost time and fatal incidents around the world. It is fair to say that site owners and operators' awareness has increased dramatically in many countries around the world. However, the credit crunch has and will impact the choices made by owners when selecting fall prevention measures. However legislation and its enforcement, unlike the credit crunch, will not slow down. Many operators which invested in equipment that only just complied with regulations 10 years ago now face potential reinvestment as legislation tightens. Folding stairs Folding stairs (retractable gangways) have been in use around the world for over 20 years. Their function has changed very little in that time – they provide a simple temporary bridge between a fixed platform and the variable height and distance of a tanker. Increasingly, they are bought with fixed safety cages and these provide adequate fall prevention measures, but only if the folding stair is positioned correctly on the tanker and the operator does not need extended access to the tanker top. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Even the best laid plans...

Every employee wants, and is entitled to, appropriate protection from workplace hazards, whatever the industry While the US Department of Labour's Occupational Safety and Health Administration (OSHA) and the OSH Act of 1970 have done a tremendous job protecting the worker from workplace hazards, no system is perfect, and workplace accidents and incidents do continue to happen. One area that annually features a notable number of incidents is fall protection. In fact, according to OSHA's list of most frequently cited workplace violations, lack of – or inadequate – fall protection ranked third in 2006 and second in 2007. When it comes to fall protection, the standards and regulations are open for interpretation. The Department of Labour says that any time a worker is at a height of four feet or more, the worker is at risk and needs to be protected. Also, regardless of the distance, fall protection must always be provided when working over dangerous equipment and machinery. However, OSHA's actual fall-protection requirements are somewhat nebulous: 'a... site must maintain a 'safe' work environment'. With no exact definition offered for the word safe, this means that, potentially, one man's simple stubbed toe could be another's just cause for a multi-million-dollar lawsuit. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

How side-entry mixing reduces the risk of a tank collapse

By minimising the level of sludge on the tank floor, terminal operators can enhance safety as well as saving both time and money The 2005 collapse of a crude oil tank in Belgium threatened to release more than 37,000m3 of oil into the surrounding ecosystem. Fortunately weather conditions and other factors, including an earthen dike system, prevented a major catastrophe – but it could easily have been a different story. For example, in the US, more than 1,000,000 gallons of heating oil spilled into the Monongahela River near Pittsburgh in 1988 after a storage tank collapsed while being refilled. Similar incidents of tank collapse are possible, even as mounting evidence demonstrates that installing side-entry mixers into crude oil storage tanks can reduce these risks. Side-entry mixers effectively suspend sediment, preventing it from settling on tank bottoms, an often cited cause of tank malfunctions. When it settles, the sediment traps water against the side of the tank or even on the tank floor, even if proper drainage techniques are followed. Materials in the water, including salt, react with the steel, causing corrosion. Some storage tank operators take a proactive approach, implementing the American Petroleum Institute's (API) 653 Tank Inspection, Repair, Alteration and Reconstruction certification programme. Specifically established to reduce catastrophic tank failures, the programme establishes procedures and protocols for inspecting aboveground storage tanks. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Keeping it tight

Once roof seals have been installed they must be regularly maintained A common tendency today is to position a new tank seal, particularly on a newly constructed tank, and assume that the seal will operate perfectly until the first 10 year maintenance outage and inspection. This is similar to purchasing a new car and failing to change the oil or tyres. A floating roof tank is a dynamic, moving structure. The components are subjected to large mechanical loads, friction, exposure to corrosive products, weather, heat, UV radiation and any number of other factors that can cause breakdown and a reduction in service life. The consequences of a failed seal are loss of product, increased pollution of the environment and possible fines from regulatory agencies. Improper maintenance can also force a premature tank shutdown which can have serious operational effects for the terminal or refinery owner. Seal types Most floating roof tanks are equipped with primary and secondary seals. The primary seal is usually the workhorse. It provides the primary barrier to vapour release from the rim space. The secondary seal acts to provide an incremental improvement in product retention and vapour release, and typically has tighter regulatory restrictions for tightness and gapping. Most regulatory entities require 'no visible gapping' in the secondary seal. As a general rule, the metallic parts of any seal, primary or secondary, are less likely to cause problems over the life of the seal. While galvanised steel parts are still used on occasion, the industry standard is to use austenitic stainless steel for metal parts. Stainless steel provides both corrosion and mechanical advantages. Unless the product is very low pH, or has high concentrate of chlorides, austenitic stainless steel parts should provide a 20 year service life in normal operation. The most frequent causes of failure in the metallic, or support parts of either primary or secondary seals is a catastrophic mechanical failure. Usually, but not always, these will be observed soon after putting the tank into service. The following are the most common causes of a major failure in the metal parts of tank seals. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Challenges in vapour recovery

Well-designed systems are essential when trying to capture VOCs cost-effectively and easily Anyone who has spent any time working on storage tanks knows that any space not occupied by liquids is filled with vapours. So the process of cleaning a tank – decontamination – must also include vapour control, or these harmful vapours will be released into the atmosphere. Regulations require the vapour space be controlled to a specific concentration of cargo prior to open venting of the tank. Vapour control is now a necessity and the regulations are becoming more restrictive. Types of control devices Vapour control systems currently in use for tank degassing can be divided into two types: those that pull vapours out of the tank in a one-way flow ending in a control device, and those that recirculate in a closed loop. One-way devices are usually mini enclosed flares, combustors or internal combustion engines. They burn the cargo from the tank and when the cargo vapour becomes lean toward the end of the process, a supplemental fuel like propane or natural gas makes sure the combustion continues. This concept is so simple that it is often used as the primary method of tank vapour control, even though it has flaws. Closed loop devices that use refrigeration to condense the vapour are very different from combustors. The closed loop refrigeration system is a more sophisticated technology that results in the condensation and capture of the vapour. Vapours are extracted from the tank and circulated around coils chilled by liquid nitrogen. The product in the vapour condenses and is pumped to a holding tank while the non-condensable vapour is returned to the cargo tank. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Fuel contamination

Terminals can lose 7-10% of stored fuels if fungus and microbes spread through the tank Fuel contamination is a problem that has been plaguing the marine and aviation industry for years. These tiny bugs have caused and continue to cause millions of dollars in damage and operational costs, in some cases entirely closing down operations. For example, in 2000 the entire Australian private aviation industry was closed down with some estimating the costs at US$180 million (€125 million). Both the marine and aviation industries have put stringent guidelines in place to combat problems caused by microorganisms, which live and grow in fuel, fuel tanks, cargo and ballast tanks and lube oil systems. Contamination problems have spread to such a level that it is considered almost an epidemic by the operational groups that have to deal with it daily. This known problem is magnified significantly by the mandatory addition of biofuel mixes to fuel supplies. Other industries however paid very little attention to the problem. Some fuel storage tanks, several of them with emergency fuel have gone unchecked for seven years or more. Unlike the marine industry which provides extensive guidelines on how this problem should be managed and the aviation industry that stipulates the maintenance procedures for preventing contamination, very little information is available to tank owners in terms of guidance response. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details

Back to Dubai

StocExpo returns to the Middle East for the third conference and exhibition in the region Moving on from last year's event in the Kingdom of Bahrain, StocExpo Middle East enters its third year with a return to Dubai, home to the inaugural show in 2006. The show will take place from 20-21 January 2009 at the Hyatt Regency, Dubai. Oil exploration and storage in the Middle East (ME) has been affected by the present gloomy market, with production being scaled back. In November the Organisation of Petroleum Exporting Countries (OPEC) announced a 1.5 million b/d reduction to its oil output targets. The reduction, effective from 1 November, would put total OPEC production at 27.308 million b/d from the 11 member countries that are bound by quotas. The organisation cited sliding oil demand resulting from the financial crisis and slowing global economy as the reason behind the cut, asserting that the market has been oversupplied with crude for some time. Iraq and outgoing OPEC member Indonesia were not assigned a new production ceiling. The largest cut was assigned to Saudi Arabia, which agreed to reduce output by 466,000 b/d. The Centre for Global Energy Studies (CGES), London, calculates that Saudi Arabia's new quota will be 8.477 million b/d, based on figures released after OPEC's November 2007 meeting. In order to comply with the new quotas, Saudi Arabia will be required to cut its actual production by more than 1 million b/d from an estimated September 2008 level of almost 9.5 million b/d, according to CGES. Iran will have to cut its actual output by 300,000 b/d from its September level, Kuwait by 200,000 b/d, and the UAE, Algeria, and Libya each by more than 100,000 b/d. Despite the downturn, the storage industry continues to operate at high levels, and the two-day conference will provide a commercial outlook, strategy and focus on the region. Speakers will deliver comprehensive and in-depth presentations further investigating ME capacity, regional and global drivers and new entrants to the market amidst a well of other subjects. The concurrent exhibition will feature new products and services from companies such as Belven (formerly named Belgium Ventiel), CTS Middle-East, J de Jonge Flowsystems, and Sai Tools. The StocExpo shows span three continents. Following StocExpo Middle East, StocExpo Europe heads to Rotterdam in March for its fifth show. The second StocExpo Turkey & the Black & Caspian Seas show will occur in November. StocExpo also covers the southern Asia and South American markets. To read this article in full you will need to subscribe to Tank Storage Magazine or buy the back-issue. Click here for further details