Tank Storage Magazine v05 i05


Volume: 5
Issue: 5
Date Published: November 3, 2009



Singapore: still the Houston of the East?

The first phase of European trader Trafigura’s 400,000m3 Tanjung Langsat oil storage terminal in Johor has just been completed, global oil trader Vitol is planning its own terminal at Tanjung Bin and Vopak is conducting a feasibility study to develop a storage facility in Pengerang. These are just a handful of the major projects that have been announced for Malaysia this year. Other plans for the region include Malaysia’s privately held Merapoh Resources, which has signed a MoU for a proposed $10 billion (€6.7 billion) refinery in Yan, Kedah, northern Malaysia; Malaysia’s Pristine Oil, which is building tanks to hold up to 1.5 million barrels of oil; and Malaysia’s Trans- Peninsula Petroleum, which is working on a $7 billion oil pipeline across the northern part of Peninsula Malaysia. So is Malaysia looking to take the status of Asia’s oil storage hub away from Singapore?

Jurong Island doubles storage land

Singapore’s oil and petrochemical hub Jurong Island has finished, doubling the land available for storage. Work was completed on 25 September lifting the availability of land space to 3,000 hectares. Rapid industrialisation in the 1980s led to a scarcity of land on Singapore. Consequently, authorities hatched a plan to join seven islands with a land mass of 991 hectares into one island. ‘When reclamation works first started in 1995, we had aimed to complete it by 2030,’ Cedric Foo, JTC chairman, comments. ‘However, as Jurong Island began to take off as a key petrochemical hub, JTC sped up the reclamation to ensure that we would have ready land to meet the surge in demand. We brought forward Phases 3 & 4 of the reclamation project and managed to complete the reclamation well ahead of our initial target date.’

Malaysia makes its move

Singapore offers the largest petroleum and petrochemicals storage capacity in southeast Asia. However, with only limited land available for storage terminal construction and other port development in Singapore, neighbouring Johor state in the southern Peninsular Malaysia is looking to attract investment in storage terminals and other port facilities to develop the state as a new southeast Asian logistics hub. Earlier this year Malaysia’s Dialog Group Berhad announced plans to invest more than 1 billion Malaysian ringgit (€197 million) to build a third party tank storage terminal and port facility at Pengerang in Johor, along with Vopak, to handle oil products. Construction is due to begin early in 2010 following completion of a six-month feasibility study including an environmental impact assessment. ‘The project is expected to take up to 10 years to complete. It may be split into three phases and we will be inviting other partners such as multinational corporations involved in oil storage services to build and operate the terminal,’ Dialog Group chairman and group MD, Ngau Boon Keat, told reporters after signing a MoU with Johor state government and the State Secretary Johor for the project.

Market consolidation a must for Japan

Nippon Vopak was established in 1966 as the first third party tank terminal in Japan and now has five terminals in four major industrial areas: Kawasaki and Yokohama in Keihin, Nagoya in Chukyo, Kobe in Hanshin and Moji in Kyushu – giving the company a total storage capacity of 220,500m3. And although the terminal would like more capacity, this is not as easy as it might seem. Due to regulations which came in 30 years ago, terminals now need three times more space than in the past to build a terminal, with land costs making this nearly impossible. In order to have a terminal of international standards, the land must also face the waterfront and be away from residential areas. Construction costs depend on the facility required but approximate costs are around 15 billion yen (€0.1 billion), which makes it almost impossible to recover the investment within 25 years.

Testing best practices

After major incidents such as Buncefield or Texas City recommendations and guidance soon turn into international best practices. It could be argued that some of these are an over-reaction to an incident that few could have predicted. However, with the large number of bulk storage tanks worldwide, failures are not uncommon and neither are their causes. For example, Thyer et al have identified 64 catastrophic and 15 multiple tank failures over an 85 year period (1919-2004) – almost one a year. Their causes are all relatively well known and preventable, or at least their consequences could have been mitigated (e.g. failures from earthquakes). With this in mind, prudent operators will be asking themselves if their installations compare favourably with best practice and, if not, what can be done. Primary containment Primary containment is essentially equipment that has direct contact with the liquids being stored. For example, tanks, pipework and valves. However, it also includes supporting infrastructure and systems such as foundations, piping supports and level alarms linked to shutdown systems.

Tank terminal update - Asia

Home to the world’s two fastest growing economies, Asia’s energy demand is second to none. China’s 1.3 billion people, exceeding India’s population by 200 million, undoubtedly have a massive effect on oil and petrochemical consumption and the growing need for up to date storage hubs. Worldwide oil storage capacity has increased from 379.77 million m3 in 2000 to 470.62 million m3 in the fi rst half of 2009, at an average annual growth rate of 2.3%. Global oil storage capacity is expected to increase to 488.07 million m3 in 2013 at an annual rate of 0.9%. Investments by China to create strategic petroleum reserves are anticipated to further strengthen the growth of the oil storage industry. A handful of key companies, notably China National Petroleum Corporation, China National Offshore Oil Corporation, PetroChina and Sinopec, are upping tankage amidst a Government strategic storage tank construction programme amounting to some 5.4 million m3. Vopak is increasing its presence in the nation, as well as Indonesia, Japan, Malaysia, and Vietnam with 80 terminals in 32 countries.

Analysing the coatings sector

Coatings are widely used in the storage industry for applications including providing internal corrosion protection for tanks, seawater protection for jetties and temperature resistance for pipelines. In 2008, protective coating revenues and volumes for the oil and gas market totalled €214.9 million and 25.3 million litres. In 2015, they are expected to reach €245.6 million and 27.6 million litres, respectively, at a compound annual growth rate (CAGR) of 1.9%. In 2008, there were less than 35 suppliers in the European oil and gas protective coatings market. The downstream or petrochemicals and chemical processing markets were more competitive than upstream, as a greater number of suppliers participated in those markets. Coatings suppliers with a global presence and innovative technologies are expected to have a significant competitive advantage. The top three suppliers, namely Akzo Nobel Company, PPG Protective and Marine Coatings and Hempel, together accounted for 60.09% of the total European oil and gas protective coatings market’s revenues in 2008 (both upstream and downstream). The total oil and gas protective coatings market was dominated by Akzo Nobel, with a 24% revenue share in 2008, followed by PPG (Ameron and Sigma Coatings) with a revenue share of 23.4%; lastly, Hempel held a revenue share of 12.6%.

Risk reduction for lightning-induced tank fires

The image of a large storage tank filled with flammable liquid, fully engulfed in flames caused by a lightning strike or electrostatic discharge, is a spectacular yet frightening sight. This is particularly true for tank farm owners and the surrounding residents, yet the danger of these fires and toxic fumes spreading are a constant hazard to all of those nearby. Even though tanks are normally protected against lightning strikes and electrostatic discharges, such incidents are often considered freak accidents, but they are hardly rare. And when they do occur the consequences are usually alike, incurring environmental, financial and infrastructure losses that are devastating. Most tank fires receive local attention, but technical information is usually limited. Incidents of this kind are rarely reported, and therefore comprehensive numbers of fires directly caused by lightning strikes and electrostatic discharge in recent years are difficult to ascertain.

Re-using storage tanks

It is now widely accepted that lifting a tank is better than dismantling it and starting again. Building a new tank can be very expensive and in most cases resource management consent must be obtained from local councils, all of which can be time consuming, adding further to the cost. In some cases the waiting period to build a new tank can be up to fi ve years. When tank owners have no more land for new tanks, one option is to group tanks together and another is to look at a terminal close by that may have unused tanks. Another possibility is to return the leased land to the land owner allowing the terminal to relocate to another area or again group tanks together for effi ciency. When looking at moving a tank the problem is not the size, but what is in the way between point A and B, such as power lines, bridges, roads, rivers and open water. One rule is to always look up when choosing a route. The fi rst tank every moved by New Zealand-based A.R. Watson was in 1983. The company moved the 27 metre diameter tank over 500 miles out of the harbour of Auckland city, New Zealand, and transported it by barge to Gisborne city. Tanks are also often moved to make use of newly built foundations.

Tank relocating: a valuable option

Terminals and refi neries tend to prefer off-site construction of new tanks for safety reasons, so these new tanks must then be moved to the facility. Although they are large in terms of volume they are also fairly fl exible, which actually makes them easier to move than many large objects. The elasticity of the tank allows for small uneven loads and deformations without demanding the tank, but it must be well supported with many bearing points to guarantee the integrity of the tank after the relocation. However the bigger the tank, the more complicated the process gets.

Staying in shape

Tanks cannot be moved perpendicularly with air bags as they have no lateral stability. Instead the tank must be pivoted or rocked over a hard pivot point so as to try to anchor the tank from moving. However this can cause shell distortion as the tank pivots on the hard point. Shell stress can cause out of roundness, damaging the wind girder, or in the case of a cone roof tank, rafter connection problems. Repeated rocking of the tank over and around pivot points also has a tendency to induce rotational differential between the columns and the shell, often known as racking. This can be severe enough to require complete replacement of the roof and column structures. Short stroke mechanical or hydraulic jacks properly installed have excellent lateral stability, so unlike airbags, they can perform a perpendicular lift. However, if one jack is allowed to lift faster than another the shell will be distorted. This will weaken rafter connections and stress the floor to shell connection, which may lead to future failures of this connection.

Why calibrate a storage tank

Large storage tanks are not perfect cylinders. There are many variables that change the shape during construction and as the tank ages. For example heat input during welding can create distortions at the weld seams and tank settlement can cause various changes to the shape of the bottom shell and can tilt the tank in certain circumstances. Tank strapping or calibration is the process of gathering accurate measurements for the purpose of producing tank capacity tables. The tables express the volume measurement for a specific product height in the storage tank. These are tied to the strike point and serve as the reference for all elevations within the tables. The strike point is positioned on the tank bottom plates below the gauge pole or under a roof mounted gauge point. It is also tied to the floating roof and serves to establish when the roof is fully floating in product.

A flare for problem solving

Large oil tanks are periodically checked from the inside to ensure continuous safety and closeness. Conventional cleaning during this process is neither feasible nor allowed due to emission regulations. Therefore the institute of process engineering and environmental protection in Leoben (Austria) has developed a low-emission cleaning procedure by flare. The new technology was approved during the following tests and documented with measurement data. The combustibility of gaseous mixtures starts at a percentage of 40 g/m3. Based on this, a special flare was developed together with Germany-based plant equipment supplier Prema- Service to virtually combust all emitting hydrocarbons without leaving any residue. The hydrocarbon-saturated gas mixture is exhausted by means of a blower. This establishes a permanent depression inside the tank to avoid any diffuse or direct emission. The evacuated gas is transported to the flare through flexible piping, where it is burnt afterwards. Expiration of the flame is circumvented by a permanently running pilot blower. Backfire is avoided by two safety devices, one before and one after the blower. It is not unusual to find hydrocarbon concentrations of over 300g/m3 in the initial stage of the process. During this phase the gas mixture has a high fuel value and can directly be disposed of in the flare. The average emitted hydrocarbon concentration in the exhaust gas lies far under 10g/m3.

Real world wireless

Using wireless technology has allowed Technochem Environmental Complex (TEC) in Singapore to automate its inventory management by delivery continuous level measurements from 14 storage and process tanks. TEC provides treatment, incineration and distillation services for chemical wastes generated by pharmaceutical and petrochemical companies. At TEC, an accurate tank level measurement system was needed along with an automated method of moving that data into a computer database. In addition to tracking and managing inventories, documentation was necessary to schedule incoming customer delivery and give the status of their orders, including assurance that their chemical wastes had been treated and destroyed. Wired devices were considered initially, but the high cost of wiring, even in this relatively small complex, was a drawback. The company installed an Emerson Smart wireless system in April 2008. Benefits include wireless pressure transmitters to report on tank levels, more accurate real-time data for process efficiency, documentation to verify that specific chemical wastes have been destroyed, and access to the data via the company network.