Tank Storage Magazine v07 i03


Volume: 7
Issue: 3
Date Published: May 17, 2011



What's driving the international storage boom?

Atlantic Fuel Supply Company Limited (AFSC) is a newly-established company formed to provide and operate an oil storage and distribution facility network for the Republic of Ireland market. The 79,800m3 capacity AFSC terminal – located in Foynes, Limerick – is the one of the first post-Buncefield oil terminals of this size to be constructed in the UK and Ireland. Originally a brownfield site, the facility took two and a half years to develop and opened on schedule for commercial business on 4 October 2010. The terminal’s refined oil storage capacity is divided between five main products – unleaded petrol, derv (diesel), gasoil, kerosene and heavy fuel oil – and comprises 16 main storage tanks located within two impervious bund systems. The terminal also has biofuel blending facilities for FAME, ethanol and heavy fuel oil blends. The terminal is ship fed from a Shannon Foynes Port Company owned jetty in the Shannon Estuary, which provides the facility for offloading tankers up to 35,000 tonnes capacity. The contents of the tanks are monitored by a radar gauging system, which is claimed to offer an accuracy of +/- 0.5 mm and is weights and measures approved for inventory control. The gauging system has the facility to provide a large spectrum of alarms to ensure safe import and discharge of products.

Pumping under pressure

the Port of Gothenburg is home to the only project of its kind. At the end of the 1970s, the Swedish government had four huge rock caverns built for crude oil storage in Syrhala. With a storage capacity of 800,000m3 of crude oil each, they were used for contingency stockpiling of the national oil reserves to prevent supply shortages. As a consequence of the changed geostrategic situation in the mid-1990s, however, the Swedish government closed all strategic oil storage plants. The existing caverns will now be used by Scandinavian Tank Storage for interim storage of the only one seal shipped on smaller vessels through the Baltic Sea from Russia to Sweden, where it is then pumped onto ocean-going vessels for its onward journey to North America, Japan, Singapore and to the large European refineries. One of the caverns is therefore being prepared for reuse as a transit crude oil storage facility. Having completed construction phase one, the first shipload of crude oil is expected for the autumn of this year. The pumps for the project are being provided by KSB, Germany, a company with history in supplying equipment to storage caverns. The oil will be pumped to the surface by three special-designed submersible borehole pumps manufactured at KSB’s Homburg site in Germany. All three pumps are equipped with a 700kW motor and are operated at a voltage of 6,600V. The pumps are made of duplex stainless steel and each one has a flow rate of 2,000m3 per hour. The head is around 80m. During testing, both pump and motor exceeded the quoted efficiencies. Since the cavern is heated, the motors had to be equipped with an external cooling water supply system. Despite this fact, the pumps, including power cable and cooling water tube, were not allowed to exceed a given outside diameter, because they have to fit into existing caisson pipes This is the reason why standard pump/motor units could not be used for the application. Three process pumps, installed aboveground pump the oil to the waiting ocean-going tankers.

Safety is not a competition

Many would question whether a company like Shell benefits from being better at safety than the competition. But when an incident occurs in the industry it affects the whole sector. The tragic BP incident (resulting in a drilling moratorium for all) is a case in point. Safety first as a principle is echoed well into terminal operations, so during tank filling operations utmost care is needed to prevent product overfill. As a result of experience, four key operating levels have been established, as further described here. For all product transfer operations there must be sufficient time for action to be taken once an alarm is activated. The key to creating effective protection barriers is their independence from each other and the availability of three to four backup options. Below are some examples of current barriers: • Safeguard alarms/level alarms, monitor operations and operating windows. Operating windows are limits that have been clearly defined, as operating limits for a tank, these are divided as described in detail to fill levels, including response times required in the case that product in the tank arrives at these limits • Site procedures and receipt plans (training and procedures) • Site maintenance and inspection plans: A receipt plan is in place to ensure that all the relevant barriers are well understood and that the responsible person is aware of the plan of action and when in doubt has a procedure for reference, taking into account external factors that it is natural for stress during alarms to cloud judgment. Terminal management shall ensure that this information is available to all operators, is clearly marked and indicated on tanks to be visible to operators performing tank gauging and sampling • Gauging systems and their verification • High level alarms: Safeguard alarms are set according to operating windows.

No slowing seen in storage growth

Contact any of the big names in the midstream sector of the US and one story soon emerges: expansion. Be it organic or through acquisition, the big midstream operators are investing heavily in new infrastructure to capitalise on a market that requires increased volumes of storage and pipeline capacity to satisfy customer demand. Take NYSElisted Magellan Midstream Partners, for example. Last year the firm took the decision to ramp up its exposure to the crude oil storage and pipelines market, complementing its significant business in the storage and transportation of refined petroleum products, such as petrol and diesel fuel. Magellan is spending $110 million (€74 million) to add another 4.25 million barrels of crude oil storage at its Cushing, Oklahoma, US hub this year, the physical delivery point for NYMEX crude oil contracts and a major hub for Gulf Coast imports and Canadian oil supply. It has also announced plans to invest $62 million to add 1.5 million barrels of refined petroleum products storage at its Galena Park terminal, Texas, US, due online in late 2012. This comes on the back of last year’s $289 million acquisition of 7.8 million barrels of crude oil storage at Cushing and more than 100 miles of pipeline in Texas from BP. The company is also mulling the reversal and crude oil conversion of the 90,000 bpd Longhorn pipeline, acquired in July 2009, at a cost of $330 million. This is a very aggressive growth strategy, taking the company from a near standing start three years ago to one of the largest operators of tank capacity at the strategic Cushing hub. And it does not stop there, with the company assessing another $500 million-plus of potential expansion projects. In November 2010 Houstonbased Plains All American Pipeline announced plans to increase its existing storage capacity at Cushing by 30% by adding another 4 million barrels of storage capacity through a $85 million threephase construction process, with the additional capacity coming online this year. This will give NYSE-listed PAA total capacity at Cushing of over 18 million barrels, some nine times its original size. The previous month, PAA had announced a series of acquisitions totalling $175 million, adding stakes in midcontinent pipelines and 55,000 barrels of terminal capacity in West Texas, and it opened 2010 with a $64 million acquisition of a series of midstream assets from Chevron, Marathon Oil and Shell Pipeline, including a 100% interest in 720,000 barrels of tankage at Patoka, Illinois, US.

A unique business model

Blackwater Midstream is one terminal operator that knows a good thing when it sees it. ‘We’re in an industry where demand for storage outstrips supply, allowing for very stable cash flows,’ says Michael Suder, the company’s CEO. ‘We’ve seen demand for storage surge in the last 10 years, with major players building wherever they can.’ In the US, an estimated 700 million barrels of petroleum, chemicals, agricultural products, and renewable fuels are stored at any given moment. As an independent storage provider, Blackwater Midstream is immune from any commodity price risks and is isolated from the economic climate. At the end of last year Blackwater Georgia, a wholly owned subsidiary of Blackwater Midstream, reached an agreement to lease the remaining storage capacity at its site in Brunswick, located between the Port of Jacksonville, Florida and Port of Savannah, Georgia. In doing so the company achieved it aim of leasing the entire facility within six months of acquiring the site. The site consists of 161,000 barrels of capacity. Before the acquisition in July last year the previous owner dismantled a 150,000 barrel tank. This means that by rebuilding this Blackwater has the potential to double the capacity of the site. The site’s current lease ends in September 2012 so Blackwater is in conversations with the Georgia Port Authority about a long-term lease extension. ‘If and when the extension is agreed upon Blackwater will look to expand the site based on customer demand,’ Frank Marrocco, the company’s chief commercial officer explains.

EU ban requires immediate action

on 27 June 2011, EU legislation comes into force, banning firefighting foam concentrates containing Perfluorooctane Sulfonates (PFOS). The widespread use of PFOS-based compounds as a firefighting solution over the last 40 years has resulted in an estimated 30 million litres of foam containing PFOS in the EU market alone. Developed in 1949 by 3M in the US, PFOS compounds, together with Perfluorooctanoic Acid (PFOA), have been used to manufacture aqueous film forming foam (AFFF). AFFF is a synthetic product developed by the US Navy in the 1960s as a firefighting solution for hydrocarbon and flammable liquid fires. The low viscosity of the foam enables it to spread over a large surface area, stopping the formation of flammable vapours and reducing the risk of more aggressive fires taking hold. This widespread use of PFOS-based compounds as a firefighting solution over the last 40 years has resulted in an estimated 30 million litres of foam containing PFOS in the EU market alone. 3M phased out production of PFOS, PFOA and PFOSrelated products in May 2000 in response to an investigation by the US Environmental Protection Agency regarding the toxicity of the compound. Owing to this, the majority of current stock levels are as a result of foams manufactured and supplied prior to 2000. The impact on the industry There has been some confusion and delay in adopting the EU directive policy, with a lack of clear best practice guidelines and grossly undervalued stock levels playing a significant role.

Cause and effect

Lightning may be the most common source of tank fires, and is more likely to cause a fire in external floating roof (EFR) tanks than internal floating roof (IFR) tanks. Fires caused by lightning in EFRs typically occur due to arcing between the floating roof and shell structure, particularly in the vicinity of perimeter seals. Arcing occurs when lightning-induced currents encounter a path of high resistance due to imperfect bonding of metallic shoe seals and shunts. The latest editions of API RP Recommended Practice 545 ‘Recommended Practice for Lightning Protection of Aboveground Storage Tanks for Flammable and Combustible Liquids’ and NFPA 780 ‘Standard for the Installation of Lightning Protection Systems’ present conclusions drawn from lightning simulation testing commissioned by the API and the Energy Institute London. API 545 replaces the lightning protection requirements of API Recommended Practice 2003 ‘Protection Against Ignitions Arising Out of Static, Lightning and Stray Currents’. New requirements: 1) Applicable to new construction 2) Floating roof shunts (at the perimeter seals) must be located at least one foot below the liquid level 3) Bypass conductors (away from perimeter seals) are required in addition to shunts 4) Perimeter seal assemblies above the liquid level must be electrically insulated from the rest of the floating roof 5) Retrofit is acceptable if existing shunts above the liquid level are removed 6) Gauge poles must be electrically insulated from the floating roof. Incorporation of these requirements into API Standards 650 and 653 is currently being balloted in the API Subcommittee on Aboveground Storage Tanks (SCAST).

Is sustainable storage possible

liquid bulk terminals are large consumers of natural resources. For their main activities of transhipment and storage they demand energy for heating and pumping of the cargo. One of the major crude oil and oil products terminals in the Antwerp-Rotterdam- Amsterdam (ARA) region conducted a study to see if onsite sustainable energy generation would be possible. Tebodin Consultants & Engineers then evaluated the results to see which options could be considered without compromising safety or impacting core terminal operations. The terminal’s energy demand Two main users of energy can be found at a liquid bulk terminal. The first are the pumps required for (un)loading of the cargo and internal transfers. The considered terminal uses electrical powered pumps, which use 24% of the total energy demand. The pumps require an average of 0.5kWh per tonne cargo displaced. Besides these pumps, 12% of the energy demand is equally spread over many other users such as lighting, trace heating and others. The second main energy demand is the heating system. It is gas fuelled and consumes 64% of the terminal’s total energy use, which amounts to 1.5kWh per tonne cargo displaced. These numbers are of course depending on a range of parameters such as: • Product types and share in total throughput • Equipment efficiency and type (electrical vs. diesel pumps) • Location of the terminal and seasonal influences • Infrastructure type (e.g. insulation quality of tanks) • Berth occupancy and terminal throughput. Therefore they cannot be copied to another terminal, but do provide an indication of the energy demand. The considered terminal consumes 82GWh/ year, which equals the energy of about 5,000 households

It's all in the detail

Pontoon and skin type aluminium internal floating roofs (AIFRs) are an evolutionary design based on proven features and lessons learned from the observation and repair of AIFRs and AIFR manufacturer’s roofs that have failed in the field of operation. Most failures are caused by inadequate floatation, weak/poorly designed and improperly assembled components, structural members spaced across a large grid, poor test port design and the use of plated fasteners. By conducting numerous inspections, the design of the AIFR has been improved to increase the product’s service life. Often the design improvements negate an insidious flaw and are certainly not an apparent subject in the bidding process. Closely examining the details are necessary to distinguish reliability and life expectancy between a quality AIFR and a low cost aluminum roof. Design - manufacturing and field installation A quality AIFR is custom designed from engineered drawings for each unit built. The roof is fabricated in the shop, a controlled atmosphere, using custom extrusions and shapes, under strict controls, demanding quality control and standardisation, and then field assembled by qualified installers. The lower priced AIFR is fabricated in the field using standard sizes, shapes and materials dependant on varying field crew decisions, technique and improvisation. Experienced field crews then assemble AIFRs that are precut, pre-drilled and labelled. This will produce a consistent and quality product. AIFRs that are field erected, often with company supervision using local unskilled labour will produce an inconsistent and varying quality product. Inadequate floatation and the inappropriate positioning of pontoons have caused failures. There are guidelines in API 650 Appendix H, which are the universally accepted industry standards for floating roofs. Under: H.4.2 internal floating roof design, buoyancy requirements are elucidated in detail. H. calls for buoyancy to support at least twice the dead weight of the AIFR and all components and the calculated friction exerted by peripheral and penetration seals. What is not addressed here is the positioning of the buoyancy (pontoons) especially on a large diameter roof considering the friction of a primary and secondary seal. Failures can and have occurred because there were not enough pontoons positioned at the perimeter.

The petrochemical protection pyramid

oil and gas facilities are hazardous environments. From security gates with highly sensitive control circuitry to the motion sensors in video monitors, the circuit boards in fire protection systems, the computers in control rooms, to the spark gaps on storage roof tanks, every inch of the facility has the potential to experience down time or delays, due to the disruptive effects of voltage spikes. These spikes, from natural events like lightning or just the typical over-voltage surge that comes from powering up equipment, compromise the safety and economic integrity of every aspect of an operation. Protection from this type of disaster can be highly mitigated if not entirely eliminated by the proper implementation of a grounding, surge suppression and lightning protection system. A three tiered protection pyramid is a visualisation tool for the analysis and implementation of a voltage and lightning protection system. Each level represents a method used to protect facilities from damages caused by harmful electrical currents. Rather than treating these tiers as independent, each layer is regarded as an interlocking component forming a strong and stable pyramid. When all three tiers are designed, installed and maintained together as a total system, comprehensive facility protection can be achieved. The foundation tier of the protection pyramid begins with the design, installation, and maintenance of a code compliant, low impedance/low resistance grounding system. Correct bonding of equipment to the grounding system is critical. Upon this foundation, surge protection devices are staged to filter voltage, current and frequency surges. Crowning the pyramid, a welldesigned lightning protection system is created to protect against direct lightning strikes.

Aluminium domes under scrutiny

the technical evolution of aboveground storage for liquid hydrocarbons has led to some different concepts for cutting tank emissions: - external floating roof tanks (EFRT) - floating roof tanks covered by an aluminium dome (CFRT) - fixed roof tanks with an internal floating roof (IFRT) - fixed roof tanks connected to vapour balancing and vapour recovery (FRT+VRU). In 2002 the German authorities issued extremely stringent rules of emission control with its TA-Luft. Future hydrocarbon storage plants for liquids with vapour pressures above 13hPa at 20ºC have to use fixed roof tanks, connected to vapour balancing and vapour recovery. The authorities copied the idea of vapour balancing from the process imposed some years ago to the petrol supply chain between the refinery or depot to the fuel tank in cars. Here the petrol is passing through small horizontal tanks with no chance for the application of efficient floating covers or blankets. With the introduction of the vapour balancing system, it was possible to avoid a reasonable portion of emissions within a short period of implementation. At that time the authorities in Germany responsible for emission control simply put forward their political will instead of using wellbalanced technical advice. The supply chain for petrol with its small and horizontal tanks needs completely different technologies for emission control compared to large capacity tank farms with flat bottom vertical tanks of diameters between 10m and 100m.

Decision time

Floating roofs have been in existence for over half a century, providing operators and regulatory bodies a reliable, time proven safety and emission control system. The design generally varies with the material used for construction. External floating roofs which are exposed to the elements use carbon steel construction with pontoon or double deck designs. These designs allow the floating roof to support potentially heavy loads of rain and snow and are also usually coated to prevent corrosion from weather exposure. Carbon steel floating roofs use heavy leg supports when landed as well as large air-filled compartments known as pontoons for buoyancy. External carbon steel floating roofs also incorporate some form of articulating pipe or flexible hose deck drainage system to remove excess precipitation from their surface. For tanks that use fixed covered roofs, like steel cone roofs or aluminum geodesic domes, the internal floating roof systems are typically constructed using light-weight materials because they do not have to support the environmental loads placed on the external floating roof systems. While materials vary, internal floating roofs typically use aluminum as their structural material, though some use fiberglass, thin gauge stainless steel or other composite panels. Depending on design, internal floating roof systems can usually be cable supported from the tank fixed roof structure, due to their low mass. One of the key differences between tanks with a carbon steel external or aluminum internal floating roof is their working volume. Each floating roof has a different cross sectional area displacing volume that would otherwise be filled with stored product, translating into lost working volume due to the profile depth of the floating roof system.

Successful roll-out for Total

its structures which have evolved organically are usually extremely heterogeneous – and therefore a nightmare when it comes to reporting and central process control. Instead of spending a long time struggling with legacy systems, the French petroleum group Total went on the offensive with this problem. In a major push, the company migrated all five of its French refineries in record time to a standardised communication platform: OpenTAS developed by Implico. Since December 2010, OpenTAS has also been used for the European (EU) Excise Movement and Control System (EMCS). TOP’R – or Template Order Processing Refineries – is the name of the largescale project. OpenTAS, a proven standard solution for managing and automating processes at terminals and refineries, was introduced as a new layer between the regional TAS systems and the central ERP system.

Taking matters into your own hands

Using risk consultants or modelling solutions is one way of determining the impact of an emergency and working out the best response plan – but it is expensive. A new technology called iResponse allows terminal operators to do their own modelling and analysis themselves. The user is able to load a map of their facility, setting the weather conditions to ensure the predictive models output results, incorporating the effects of the facilities environmental conditions. From here, the user can take themselves to the area of their facility involved in the emergency and start to develop their scenario which can then be stored as a preplan or developed further to form a response plan. By interacting with the map on the screen the user can model multiple fires, explosions or atmospheric dispersions for storage tanks, pipelines, spills and contained areas. Once complete, any model can be instantly modified, changing as many parameters as desired at the click of the mouse. A model can be cloned then modified, enabling comparisons to be drawn on the same facility feature (e.g. storage tank) by the changing of a parameter such as wind speed or direction. Once one or more scenario models have been defined the user can then bring further information in to the map to help evaluate the impact of the emergency, such as; • Measure the proximity of other facility assets to the source of the emergency with ruler tool • Bund volume calculator to determine capacity and time to overflow of contained areas • Placing NFPA standard icons to represent the location of key personnel and response equipment such as hydrants and toxic refuges • Annotate the site drawing with text and shapes to highlight areas of concern • Measure the impact of people and property beyond the facility perimeter via overlaying the scenario on top of satellite imagery.

Pumping heavy duty fuel oil

Heavy duty fuel oil presents many problems when it comes to transfer pumping. It is viscous and often contains foreign matter that can influence and damage the internals of the pump. Were centrifugal pumps to be used for bulk transfer duties, the process would require substantially higher costs, as large motors would be needed to drive the pumps. Also to be taken into account are higher running costs due to the inefficiency of centrifugal pumps when handling heavy duty oil. For these and other reasons, the most appropriate solution is to employ a twin screw rotary positive displacement pump. This pump type has very high efficiency characteristics and low power consumption requirements when operating at higher capacities/flow demands. With twin screw pumps, the principal design feature is the absence of any metallic contact between the screws or between the screws and their bores. This enables them to handle a wide range of fluids, including those that lack any lubricating properties. When running, the liquid passes through the pump chamber in an axial direction with the minimum degree of shear and with little or no pulsation. US-based SPX has been supplying Plenty Mirrlees twin screw pumps to refineries and oil terminals for many years and has now introduced a new model which uses a relief jacking device.

Maintaining an edge

Without question, liquid storage terminals play an integral role in the ongoing success and relevance of a wide array of industries around the world. These facilities serve as a vital hub in the storage and dispersal of numerous types of liquids, including vegetable oils and fats, oleochemicals, petroleum products and petrochemicals; all substances that are vital in the world’s transportation and manufacturing sectors. But while the range of products that may pass through a liquid storage terminal is wide and varying, the operating conditions at most terminals are quite similar – harsh, oftentimes corrosive atmospheres that require around-the-clock equipment reliability with any downtime having a potentially hugely adverse effect on the terminal’s operation and profitability. Transfer pumps used in these conditions are under constant assault and must be able to perform reliably while handling a number of diverse operating characteristics, such as: • Changes in ambient temperatures and other weather conditions, such as humidity • Line shock from piping that is not anchored down properly • Piping systems that have sharp bends instead of gentle curves • Changes in the product type being pumped • Changes in product viscosity • High volume (unloading a 50,000-gallon tanker) at high flow rates (4,000 gallons per minute) • Changes in product velocity and force • Changes in head pressure.

Crude pumping with only one seal

Petrochemical companies continuously increase their output of feedstock and finished products all over the globe to satisfy the vast growing demand for fuel, bitumen and other petrochemical products. The growth of production requires higher storage capabilities including large and reliable positive displacement pumps. Energy demand, HSE regulations and above all the reduction of operating costs are the focus of today’s terminal operators. Unique design Leistritz Pumpen GmbH has designed two screw pump series to help terminals meet these aims. These two series are designed according DIN or API standards. Twin and five-spindle screw pumps in series L2NG and L5NG belong to the group of self-priming rotary positive displacement pumps. They are designed for a pressure range up to 16bar (232psi) and suitable for transport of light abrasive and corrosive, high or low viscous storage fluids with poor or good lubricity. The pumping capacities start at a few litres per minute and go up as high as 1,700m3/h, while viscosities from 1 up to 100,000 Centistokes and pumping temperatures up to 280°C can be achieved. Besides loading or unloading duties, these pumps can also be used as circulating, blending and stripping pumps. Both designs have only one seal to the atmosphere. The drive spindle rotates and is hermetically sealed with the idler spindles in the bores drilled into the pump casing, which encloses the spindle set with small clearances. The idler spindles are driven by the drive spindle through hydraulic force. The special epicycloidal profile of the spindles guarantees the perfect closure of the pumping chambers, so that the liquid is moved continuously and almost pulsation-free in axial direction from the suction area to the pump discharge port. This pumping process guarantees a highly efficient operation at reduced power consumption, which results not only in lower initial equipment costs, but also into reduced operational costs.

Lucky number seven

oil price volatility, refinery closures and the industry’s reputation were just some of the topics covered during day one of StocExpo this year. Oil prices have changed dramatically over the past few months due to unrest in the Middle East and North Africa, from Libya to Bahrain. Not only this, but the future of prices is uncertain because of natural disasters like the devastating earthquake and tsunami to recently hit Japan. All speakers agreed that refining capacity would increase at the eastern outskirts of Europe and that more refined products would be imported into central and western Europe. As a result, storage capacities will need to increase in both sub regions. This was a hot topic at the conference, with Martina Repikova, an oil market analyst from the International Energy Agency, explaining that demand had risen unexpectantly in the second half of 2010, while supply lagged behind. ‘It’s unsure how much of an influence the disaster in Japan will have on the market. So far six refineries have been closed, which is about 30% of the country’s refining capacity. It will depend on the government as to how the situation will unfold,’ Repikova says. ‘In Libya, exports have fallen because major oil companies have evacuated their staff.’ From an oil supply perspective, Libya is critical for Europe because of its high capacity of light oil with low sulphur content fitting both refining capability and environmental constraints. It is unlikely that the Libyan production will get back to normal any time soon. The war drove up the prices to the current $100-$120 (€67-€80) per barrel levels and fears, more than market fundamentals, may further raise prices another $5- $10 per barrel. The world is better prepared for demand or supply shocks resulting in less global, more regional effects than before. Azfar Shaukat from Mott MacDonald, pointed out that the EU and the national governments all committed to strategic reserves, but that in practice, the availability of reserves is probably far below the target. This also puts pressure on prices. Despite prices, regulation, and volatility, oil will remain a major component of the EU’s mix of energy sources and will become more and more dedicated to transportation. While European refining margins are low, only the largest and most flexible European refineries have been able to invest to help correct the European surplus in petrol and undercapacity in diesel fuel, and to comply with regulations on sulphur content. Other, smaller refineries in Europe are closing. Since the crude quality impacts the European refining profitability in a major way, and supply is variable and uncertain, only-lower cost countries from the eastern limits of Europe to the Middle East are adding refining and storage capacity. Ben Holt from Wood MacKenzie warned that the product quality of refineries in eastern Europe could be very variable, and possibly non-compliant with European regulations.