No downturn for downstream
The price of a barrel of oil might have plunged from the giddy heights of around $140 (€110) since August 2008, but the mechanics of global fuel supply and the associated logistics mean barrels of oil, or tonnes of petrol, kerosene or ethanol, still need to be stored somewhere. Storage operators in Europe, with the Antwerp-Rotterdam-Amsterdam (ARA) region at its core, do not yet seem to be feeling the chill of the economic downturn that has swept across so many sectors of industry. For many, and particularly those specialising in fuel storage capacity, it is business as usual, with the extent of any negative future impact difficult to predict. The storage business’ reason for being is to hold products – for local logistical reasons before transit to the next location; for reasons of global trade patterns and supply-demand imbalances; for reasons of speculation – storing products until prices are higher at some point in the future; and often a combination of all three. Although a nightmare crude price of $10 or $5 a barrel would mean dramatic changes to oil companies’ balance sheets, trade would continue, fuel would still be needed and still need to be stored. The crude price plunge in the fourth quarter last year and the sharp reduction in upstream investment and jobs do not translate automatically to a downstream downturn, and storage operators, dealing with an increasing number of product specifications, are still riding high. So it follows that healthy results from storage operators last year cannot simply be put down to the oil price bonanza, but to factors such as increased capacity, efficiency and improved maintenance.
Biggest are not always best
Natie Terminals (NNT) may not be the biggest terminal, with 190 tanks and 235,000m3 of storage, but it tries to be the most flexible. NNT is a unique combination of two terminals that provide storage and related activities for a very broad variety of products i.e. chemicals, vegetable oils and fats (technical, food or feed use), animal fats of different categories, mineral oils i.e. base oils, oleochemicals and biofuels. Antwerp For Storage(A4S), also located on the same site, specialises in drumming of different types of products into different capacities of drums and IBC’s. A4S also offers services related to packaging and storage of packed liquids and tank containers. The terminal has four berths for deep-sea vessels in combination with four separate berths for barges so eight vessels can be handled at the same time. This large number of available berths has had a direct impact on the level of transhipment between vessels. On land, the terminal is also expanding to provide extra services to its liquid bulk customers.
Surviving the storm
Early 20th century hurricanes were named by an Australian forecaster who called the storms after politicians he disliked. Hurricane titles, like some politicians, are recycled after six years, but the names of the deadliest or costliest storms are never reused. So, while there will never be another Hurricane Katrina(2005) or Andrew (1992), it could be Bill, Fred or Victor or even the gentle sounding Grace or Odette, that hit the headlines in 2009. Hurricane season on the Gulf Coast extends each year from 1 June until 30 November. With six months to go before the next onslaught starts, operators have time to fine tune preparedness plans. Each year, on average, 10 tropical storms develop over the Atlantic Ocean, Caribbean Sea, or the Gulf of Mexico, six of them becoming hurricanes. While many of these remain out at sea, an average of five hurricanes strike the US coastline every three years. Of these five, two are typically major hurricanes, rated as Category 3 or higher on the Saffi r-Simpson scale. Storms in this category mean winds of 111 miles per hour or more. Hurricanes are not necessarily getting either stronger or more frequent, but the increased concentration of both population and industrial development, including energy infrastructure, in hurricaneprone areas such as the US Gulf Coast, means the potential for crippling repair costs creeps up each year. Hurricanes hit hard offshore, with the US Minerals Management Service reporting that 52 of the region’s 3,800 offshore oil and gas platforms were blown away by Hurricane Ike and more than a further 60 suffered substantial damage. Shut-in production offshore and shut-in refineries onshore mean an even greater need for imports and functioning storage for refined products, but tanks can suffer substantial damage too.
Emergency response planning
It is often the same deficiencies that lead to poor responses and in some cases, escalation of an incident through inappropriate tactics. Lessons are not always learned. The lack of preplanning and insufficient knowledge of responders in tank construction and response strategies have been highlighted on many occasions. The classic example of this is the ignition of unignited naphtha tanks by inappropriate application of fi refi ghting foam on at least three occasions – two of which were within the same company where the knowledge and lessons from one incident were not shared throughout the company, let alone the industry as a whole. The key to successful emergency response is undoubtedly scenario-based pre-planning and assessment of resource requirements. This should then be followed by thorough training on the selected strategies – which for fire incidents might, of course, be controlled burn down rather than extinguishment. Too often a terminal’s emergency plan is just a high level document which lists phone numbers of the emergency services, equipment supplied and key personnel, rather than pragmatic guidance that can be used as an aide-memoire for the crucial initial 30 minutes of an incident. Good emergency plans incorporate both operator and responder actions. In today’s economic and operating environment it is very rare that a storage terminal has suffi cient personnel on site to form an Emergency Response Team that can play a major role in fire attack. Consequently, there is usually a reliance on external responders. It is unreasonable to expect Local Authority Fire and Rescue Services to have the necessary levels of expertise, experience and equipment to tackle tank incidents successfully. Their priority is search and rescue, not asset protection. It is quite possible that an officer in charge may make the decision that the risk to his own personnel, especially if their expertise in tank fire fighting is limited, is too great to risk an offensive strategy and, therefore, decide to stand back and adopt a strategy of only escalation prevention. During the Buncefield incident, for example, front line fire fi ghting was interrupted, with the consequent interruption of foam application and breakdown of the foam blanket that had been established due to concerns that tanks might collapse and risk responders’ safety. Unfortunately, some terminal operators still pretend that this situation does not exist and limit their emergency planning for fi re incidents to ‘Call the Fire Brigade’. In reality, an operator should accept the responsibility of ensuring that sufficient knowledge is available within the responding organisation rather than just assuming it is already there. The Buncefield Incident was only well managed because of the combination of the tremendous logistical capability and water movement skills of the Local Authority Fire and Rescue Services and the specialist expertise and equipment from industrial responders. This combination can only be achieved by preplanning and using those preplans as the basis for training and exercises.
Retrofitting bund liners
Long-term barrier peformance is not merely optional for owners, engineers and managers of the tank farms within petrochemical containment installations. The stakes are high not only for the environment and its inhabitants, but also for the site owners if they are found not to meet environmental regulations. A reliable containment solution is of vital importance in the construction and maintenance of the tank farms within refineries and terminals. The volatile nature of petrochemicals makes them a demanding long-term challenge for the protection systems chosen. Traditionally, risk of spillage from storage tanks is mitigated by the incorporation of an environmental protection barrier beneath tanks and within bunding designs; bunding is used to prevent the liquid from causing damage (either by force or its chemistry.) If a large tank has a catastrophic failure, the liquid alone can cause extensive damage simply by the force it exerts on the floor and wall of the bund, and therefore the integrity and strength of the bund at maximum capacity is vital. Bunding must be large enough and strong enough to meet the regulations – 110% of the largest tank or 25% of the combined volume of all of the tanks within the bund. The Department for the Environment, Food and Rural Affairs is keenly reviewing the safety of the UK’s fuel storage arrangements in the wake of the Buncefield disaster. Over 80 sites are under a complete review with a further 40 falling under the auspices of another review focused on the Buncefield disaster itself. The performance of the structures used to store the nations’ fuel supplies has never been under such intense scrutiny, and a crucial component of these structures is the materials which are used to provide the all-important barrier between combustible, polluting hydrocarbons and the environment where they are to be stored.
Mandate drives increased biofuels blending at terminals
The economic recession that has now engulfed the world has had a dramatic impact on fuel demand, with the US government to international organisations such as the IEA based in Paris and OPEC all reporting an erosion in global oil consumption for 2009. If those projections bear out, it would mark the first two consecutive years since 1982-1983 in which global oil consumption contracted. Oil products volume moving through bulk terminals in the US in 2008 was down on a combination of factors. Early in the year, a market in backwardation – a dynamic in which near-term supply is priced higher than deferred delivery – limited supply being stored, with the market eventually overheating in July 2008, capping a seven-year bull run in energy commodities. Soaring fuel wholesale prices translated into record high retail prices that caused the US consumer to buckle, pulling demand down as conservation emerged. In fact, vehicle miles driven in the US were already falling at the beginning of 2008, which has historically had a connection with the health of Gross Domestic Product and employment. The official recession for the US started in December 2007, with the number of unemployed climbing to 3.6 million. Since then to the end of January this has reached 7.6% – the decline in the number of employed translates into fewer miles driven to work and back with less petrol burned. It is not just the US car owner driving less, but as ill-conceived subprime mortgages morphed into a full blown housing crisis, the spending habits of Americans became strained, credit markets locked up and freight transport fell from retail goods to construction material such as lumber. The trucking industry in the US reeled in the face of diesel fuel prices approaching $5 (€3.9) gallon, something unheard of in the US until 2008, which occurred while transport volumes were on the downturn. Not only were the early signs of less demand for freight movements beginning to show in early 2008, but the increasing expense of moving freight by road cost the trucking industry customers that transitioned to rail deliveries because of better economics. Unofficial statistics indicate roughly 3,000 trucking firms in the US went out of business in 2008, representing a 7% contraction in capacity for the industry.
From manual inspection to magnetic encoding
Imagine it is 1940. A tank farm operator has just received a call from his boss saying a large amount of product is coming his way. The boss needs to know, as soon as possible, how much product the terminal can receive and store. The operator has four gaugers working for him, whose only job function is to obtain readings from the field of tanks. Training and motivating the gaugers to trudge around and get level readings on the tanks is a challenge. They have to climb the tank, open the gauge hatch, and take manual readings of the level. And then repeat this process for every single tank. Once the operator gets the readings from the gaugers, which can take a long while, he can then report to his impatient boss. Later that day, after the terminal has started receiving product, the gaugers must continually repeat this task until the pumping is finished. It is a painstaking and time consuming task. Fortunately, those days are long past. Automatic float and tape gauges came along to innovate the process of gauging tanks, but operators still could not get real time inventory levels of their tanks at the same time. They still had to walk to every tank and read the level off the gauge. Technology to obtain remote inventory readings was not available until 1941. The convenience operators enjoy today is the result of a long process of invention and innovation.
Safety more precious than time
Safety is a combination between plant and process design, training, and experience. Nevertheless, accidents do happen. Something might break or a momentary lack of concentration on the part of an operator may result in their own or another person’s injury. Under the Personal Protective Equipment (PPE) at Work Regulations 1992, employers have a duty to provide their employees with suitable PPE, although the type of equipment may change with the nature of the work, and the area of the plant where the work is taking place. PPE is required to protect the body, the hands, the eyes, the head, the feet, the hearing, and the respiratory system. In addition to employees, site controllers have a responsibility to protect everybody accessing the operating areas of a petroleum distribution terminal. In this case the need is limited to ensuring that protection is provided for the feet, head, eyes and body. As the outsourcing of petroleum product distribution, and the use of inter-company loading has increased, so too have the number of people entitled to access the installations. The Energy Institute (EI), formerly the Institute of Petroleum, became concerned that as a result of this increased traffic in people, the standard of PPE being used might fall. There was special concern as to the variety of equipment being used, and uncertainty as to its fitness for purpose.
Shell-BP oil terminal wastewater clean-up
Typically, contaminated water stored in tanks unnecessarily use up portions of a terminal’s valuable space. This type of storage is unavoidable when an upset occurs at a facility. In a recent problem involving Shell and BP’s South African oil refinery (SAPREF), a unique solution was put to the test. Accumulated wastewater dilemma SAPREF is a joint venture between Shell SA Energy and BP South Africa. It is southern Africa’s largest crude oil refinery, with a refining capacity of 8.5 million tonnes a year. The venture was searching for a solution for accumulated wastewater that had been in storage for several months. The wastewater had been collected in response to an upset at the refinery, and was stored until the best solution could be found for its treatment. The water was highly polluted with phenol and other contaminants, and could not easily be brought down to acceptable discharge levels. SAPREF spent months searching and reviewing several treatment options, including discharging directly into the municipal sewer, but due to the level of contaminants was unable to find a resolution. Eventually the venture contacted BioPetroClean(BPC), a company that specialises in providing biological solutions for industrial waste water management. BPC first considered installing a continuous mode, skid-mounted system as a solution for SAPREF. After analysis the company realised that due to the level of contamination, coupled with the estimated flow rate of the process, it would take nearly two months in order to clean the 5,000m3 of wastewater. BPC decided to approach the problem from a different point of view, and implemented a new one-time service solution for SAPREF. Their decision was to treat the water directly inside the contaminated storage tank by introducing the selected bacteria, calculated inorganic nutrients and providing aeration conditions in a batch-mode system.
Turnkey fluid handling solutions
A tank truck filling station recently engineered and installed for a large European Chemical Corporation is a prime example of customeroriented turnkey solutions. It gives optimum consideration to the product transferred and at the same time fulfills the company’s high safety demands. Annually over 4 million tonnes of bulk chemical raw materials are fabricated at the customer’s petrochemical plant that provides base components for the production of plastics, composition rubber, fibres as well as solvents, softeners, lacquers, detergents, fertilisers and plant protection agents to the chemical industry. Emco Wheaton carried out the project, including the overall planning, engineering and execution of a loading station for filling road tank trucks with glycol. The goal was to be able to serve a various range of tank trucks without interference. Without special safety measures service personnel accessing the vehicles for top loading would be exposed to potential danger of falling. This inherent danger was prevented by back protection, folding stairs and protective grating. For this glycol loading station newly developed swivel railings were used for the first time enabling additional end fall protection. Due to hydraulic controls, the fall protection can be moved smoothly and evenly. Falling through gaps between tank truck and filling station is no longer possible. Since the different elements of the fall protection can be combined individually, the project engineers could define the exact arrangement of the system to provide maximum operator safety. The Emco fall protection is manufactured according to machine guidelines CE and ATEX. It was approved according to the guidelines of the ‘Berufsgenossenschaft Chemie’ and the ‘Berufsgenossenschaft Arbeitssicherheit’ (government safety associations). Apart from the differences in height, minimum 3,200mm, maximum 4,000mm, the engineers also had to consider the variance in vehicle length.