Tank Storage Magazine v10 i03


Volume: 10
Issue: 3
Date Published: May 12, 2014



No holding back

Midstream operator Targa Resources has announced approximately $1.7 billion (€1.2 billion) in organic capital expenditure projects through 2014. We talk to the company’s VP of petroleum logistics Vincent DiCosimo to learn more about where this money will be spent. Channelview Terminal consists of 32 tanks, with a shell capacity of approximately 540,000 barrels. Products currently handled are crude, fuel oil, used motor oils, diesel, asphalt and cutter material. The facility can receive and discharge products by truck and barge. Currently there is one barge dock and nine truck loading/unloading stations. Targa also has a lease on eight acres of adjacent property for expansion. Clearing of the expansion property has begun. Current plans are for an additional six bay truck loading/unloading station, a crude/condensate splitter of approximately 35,000 barrels per day and approximately 700,000 barrels of additional storage in 14 tanks.

Houston, we have a problem

The US oil and gas production boom is creating new opportunities for savvy terminal operators.   Houston and the Gulf Coast region are awash with crude. Last year the glut was centred on Cushing, the strategic storage hub in Oklahoma, but as existing lines are reversed or new pipelines built, most significantly TransCanada’s Marketlink pipeline, the deluge is now washing down to Houston. Backwardation is also helping flush oil down to the Gulf Coast as there is little incentive to keep oil tied up in storage in Cushing. According to figures from the Energy Information Administration (EIA), inventories at Cushing are now at their lowest levels for more than two years. They have dropped by more than a third in recent months, while stockpiles in the Gulf Coast region – centred on Houston and stretching to New Mexico and Alabama – hit a record of 207 million barrels in the week ended 11 April. This is the highest on record for EIA data; an extra 5.2 million barrels in just seven days from the week ended 4 April. US domestic production continues to ramp up; it hit 8.3 million barrels per day (bpd) in early April, the highest level since 1988 and a reversal of all previous energy supply forecasts. There are, however, growing calls for Washington to reverse the 1975 ban on most US crude exports.

Engineering expertise

Following its major contribution to the development of Fujairah, MUC Oil & Gas has gone on to establish itself as one of the Middle East’s key engineering and consultancy firms   In the Middle East, the emirate of Fujairah is the region’s emerging oil hub and the third largest in the world after Rotterdam and Singapore. MUC Oil & Gas is an engineering and consultancy firm providing services in engineering and project management for the oil and gas and allied industries. It began activities in the Emirate back in 2006 with a major contribution to the development and execution of the master plan for the Port of Fujairah, as well as a number of projects within the Fujairah Oil Industry Zone (FOIZ). The company’s services span the entire project lifecycle, from concept through to commissioning.

Open for business

Odfjell brought online its twelfth bulk liquid storage terminal in December 2013 and held its grand opening in March. Built in the US state of South Carolina, Odfjell Terminal Charleston (OTC) adds a strategic location to the Odfjell logistics network that services the petrochemical industry. Located on the west bank of the Cooper River in the Port of North Charleston, South Carolina, the $84 million (€60.9 million) OTC is well placed to serve the eastern US. ‘The site was selected due to its proximity to international shipping trade lanes and its exceptional rail and highway access, which allows us to expand our bulk liquids warehouse and distribution services in the southeastern US,’ Odfjell president and CEO Jan Hammer said in a statement.

Building a competitive tank programme

A look at cost and schedule deviation and key improvement opportunities for three categories of tank project: new tank installation, tank revamp and tank maintenance   Many major petroleum refining and transportation companies spend millions of dollars annually on their tank programmes: constructing new tanks and repairing and maintaining existing ones. Delivering on budget and schedule, as well as keeping costs low, is important. However, an evaluation of more than 200 tank projects by consultancy firm Independent Project Analysis (IPA) has shown these projects often fail to meet budget and schedule. While missing cost and schedule on an individual project is disappointing, routinely deviating from estimates ties up capital and impedes good portfolio management. As illustrated by Figure 1, new tank installation projects tend to be completed on budget, but slip schedule by 20%. Many companies have fairly robust rules of thumb for estimating new tank installation, which means estimates are generally reliable. Nevertheless, setting accurate schedule targets can prove more problematic. A schedule slip of 20% means a typical project is delivered two months later than planned, which can complicate resource management at the operating site.

Do you know the lifecycle costs of your storage tanks?

Storage tank manufacturing is a competitive market. Maintaining an edge in tank design and cost are important factors in staying ahead of the competition. Stainless steel is an ideal material for safe and sustainable applications. It is durable, corrosion resistant, practically maintenancefree, hygienic and aesthetic material. It is fully recyclable at the end of its long life cycle, and in some cases, its recycled content is more than 80%. It does not corrode nor need maintenance or coating. While stainless steel is sometimes considered an expensive solution, this is not the case. Corrosion also costs. Therefore, given the right grade and taking into account total life cycle costs of the investment, stainless steel can be very cost competitive solution.

A tall order

A collaboration of construction and engineering firms faced a tough task meeting Odfjell Terminals’ unique requirements for its new Charleston facility   When Odfjell Terminals was ready to invest in a marine terminal in Charleston in the US state of South Carolina, it called on The Roberts Company and PPS Engineers to provide support for the project. Fisher Tank Company joined the team to provide tank solutions for the new terminal facility. In a strategic location along the Cooper River, Odfjell purchased an existing but defunct terminal site and adjacent land. The brownfield terminal project included nine new storage tanks, ranging in size from 20 to 80ft in diameter and 56,000 to 2.5 million gallons in volume. The customer required that the tanks provide maximum flexibility in terms of product storage. This presented some important design challenges, including allowing for high specific gravity, high corrosion allowances and 2.5 pounds of internal pressure in each tank.

The third way to build a tank

There are two methods to erecting tanks under API 650 standards. The first method involves the assembly of the tank from the bottom to top with the use of scaffolds (the traditional method). The second method assembles the tank from the top to bottom using a hydraulic jack system (the jacking method). Argentina-based tank builder Cantoni Gruas embarked on a project to revolutionise the erection methods with the use of new innovative production systems and tools that facilitate the workload, making the erection process more efficient while providing unmatched quality and safety. The Cantoni method incorporates technology that overcomes any drawbacks that one would encounter with the other erection methods. For example, there is no need to weld all the different components such as strong backs, scaffold brackets and all the temporary attachments needed to erect the tank to provide proper tank alignment and roundness.

Not what it said on the tin

A challenging steel plate prefabrication project led to one company expanding its operations   In 2013, a liquid ammonia terminal in Bulgaria wanted to build a 14,700m3 refrigerated liquid ammonia storage tank. The scope of supply included shell, annular, roof and bottom plates totalling 519 tonnes. The contract for the manufacture and supply of these prefabricated steel plates for the construction of this tank was awarded to Switzerland-based Madesta. Prefabrication comprised the usual scope of operations, such as shot blasting, cutting, beveling and rolling. This was, however, the first time that Madesta was required to apply a protective coating to the steel plates and this proved challenging. Such a task is usually performed by tank builders at the storage tank construction site.

Tip of the iceberg or tipping point?

In the US downstream market, the widespread adoption of PIDX has forced compliance within the industry. That trend is just now starting to emerge in Europe   The approval of the latest version of the Petroleum Industry Data Exchange (PIDX) standards in April 2013 marks another turning point for the European downstream oil and gas industry. PIDX v5, designed particularly for the European downstream market, is the latest element in the continuing push by international suppliers to increase standardisation of supply management and billing communications. While the European downstream market has historically remained relatively diverse with a large variety of national standards and technology solutions, more players are recognising the business value of increased standardisation and connectivity. One of the largest European terminal operators recently became the latest to adopt the new PIDX standards, with the rest of the market poised to follow.

A perfect partnership

A web-based terminal automation system has been installed at two sites for Bulgaria’s largest independent fuel company, Saksa OOD. European Automation Projects (EA Projects), a supplier of terminal automation systems, carried out the work, which included the installation of i-Supervisor + TAS technology at both the Novi Iskar and Ruse terminals.

Business system interface

Terminals enjoy a wide range of ERP solutions and configurations. The way the terminal automation solution interacts with the business system will vary based on the terminal requirements, making each operation unique. The challenge, therefore, is to devise a software interface that can be integrated with the wide variety of ERP solutions encountered across different terminals   Traditionally, the business system to control system domain is a five-layer architecture, with the business system – commonly called the enterprise resource planning (ERP) system – being the highest (fifth) layer. The control system is represented by the first (field products) and second (DCS) layers. Terminal automation system (TAS) applications fall partly under the second and third layers, with the TAS solution typically interacting with the ERP layer through an interface, traversing through the DMZ/3.5 layer with the business system. The interface designed to integrate the automation systems present in oil and gas terminals with the business system is found in the middle layer between the ERP and TAS solution. This performs the data syncing operation. This interface must support many common functions, such as downloading master data, orders and shipment schedules to the facility’s automation system and loading details such as bills of lading and physical tank inventory data from the TAS to the ERP system.

Increasing safety levels

In 2012, a global group of energy and petrochemical companies decided to refit its Middle East-based terminals with new tank overfill prevention technology. The tanks were already equipped with an automated tank gauging system, however this did not conform with the latest standards. In order to comply with the latest recommendations from API, the company required an independent high-level alarm system, to prevent overfilling, which is separate from any device and method used for automatic tank gauging (ATG). Specifications also called for SIL3 level switches according to IEC61508 and IEC 61511-1, certified by TüV and based on vibrating fork principal and continuously self-monitoring.

Another dimension

What possibilities can laser scanning and 3D computer modelling provide to the bulk liquid storage sector?   Laser scanning and 3D computer modelling is becoming more widely used in the oil and gas sector. Laser scanning, also known as LIDAR because the process is derived from light detection and ranging, uses light to measure distances. Ground-based laser scanners, generally tripod mounted, use laser beams ‘fired’ at between 50,000 and 1 million points per second. The beam is projected in a fan shape using a rotating mirror and the instrument itself rotates through 360°. Measuring the vertical angles and direction of the lasers as they leave the scanner enables the computation of the 3D coordinates of all reflected points to a very high accuracy. Thus the scene surrounding the scanner is surveyed in 3D dimensions, very rapidly and to millimetric accuracy. The resultant data set is known as a ‘point cloud’ because it comprises a cloud of millions of coordinated points.

No need for shunts

Metal primary seals negate the requirement for shunts on floating roof tanks   In an unusual confluence of events, both the American Petroleum Institute API 545, Lightning Protection of Aboveground Storage Tanks for Flammable or Combustible Liquids, and the National Fire Protection Association NFPA 780, Chapter 7, Protection for Structures Containing Flammable Vapors, Flammable Gases, or Liquids That Can Give Off Flammable Vapors, are in their respective revision cycles. Independently, the two committees have recognised the need to readdress the requirement for shunts if metallic primary seals are installed on a floating roof tank.

Tanks beware

Lightning is Mother Nature’s own explosive and unpredictable mega-Taser which can be deadly and destructive. Tank storage terminals around the world: pay attention   Whether downstream or upstream, oil and gas, chemical manufacturing or exploration, all companies storing volatile and combustible liquids should not only be considering risk mitigation plants for lightning protection, but implementing them. This includes both grounding engineering and surge protection. A direct lightning strike is not the only issue to contemplate. While a tank that is hit by a strike is more than likely to explode, a strike which hits near a tank and is carried through the ground and/or pipes and wiring buried in the surrounding area can do as much damage. Without proper grounding engineering or surge protection, the tank can still explode and critical electronics and operations impacted. This damage can be incurred immediately or in the future, if one factors in meantime-between-failure scenarios. Lightning is tricky and devious. The secret is not having it strike within an area that needs protection.

Tank degassing and cleaning with encapsulator agents

In a world where time is money, a new technology has emerged that can save contractors time degassing and cleaning storage tanks, pipelines and other process units. When a tank needs to be accessed for inspection, repairs, cleaning, decommissioning or whitewashing, the traditional method of degassing is venting. This can take many hours to reach safe lower explosion limit (LEL) levels in the vessel. Meanwhile, equipment and workers sit idle. A more economic and efficient method is to use an encapsulator agent, which rapidly reduces the LELs to zero. During a tank degassing operation, the vessel is emptied. A 3% solution of HydroLock Encapsulator Agent is mixed with water and sprayed into the tank. HydroLock can be educted with a hose line and nozzle or added to a low-pressure spraying system. The operation should include a wash down of all the interior surfaces of the vessel. The goal is to encapsulate the volatile hydrocarbon vapours and any residual liquids in the tank.

Ethanol blending optimisation

How the installation of a new blend valve actuator has improved operations for one US terminal   The ethanol blending process is a critical part of petrol terminal operation and has a significant impact on product quality, meeting environmental regulations and profitability. Optimising the process is very important, but does present some control challenges. For example, thermal expansion of petrol and ethanol do not occur at the same rate, and the blended mixture has to be isolated from water due to ethanol’s miscibility in water. For these reasons, many terminals blend in real time while loading directly into the tanker trucks, but the required control strategy does not allow much room for problems or inconsistencies. Getting the needed control begins with accurate, consistent and reliable valve actuation.

Staying ahead of the game

AODD pumps have proven their worth in hazardous ATEX Zone 0 areas at oil storage terminals   The challenge of safely and economically dealing with rainwater and petrochemical spills in ATEX Zone 0 areas is growing. In many European countries especially, tank storage terminals must adhere to increasingly stringent monitoring and controls as former ATEX Zone 1 areas within these applications have been redefined as ATEX Zone 0. While this has left many terminals with a big headache, as it requires a review of their risk assessment, it has also created an opportunity for the sector’s pump manufacturers.

Good things come in packages

Packaging pumps and meters together to move fluids is not a new concept. However, with the large amount of liquid products being moved today, from crude oil and gases, to biodiesel and ethanol, the need for new projects to be executed quickly is of growing importance. A packaged system from a full service system integrator will help to realise a project’s expected return on investment (ROI) as fast as possible. In the past, one would have to first engage a company that could design a pump and metering system to work for the application and then provide the necessary data, drawings and bill of materials required by the end user to procure the parts to build the system. At this point the end user will have already started spending valuable time and money just in the development stages. From there, parts have to be located, purchase orders issued, supplier deliveries managed and expedited and the projects timelines managed. This can be a tremendous drain on internal resources and the cost in terms of both time and money are very high.

Energy efficiency is the key

Double volute twin screw pumps are rotary positive displacement pumps which have a wide field of applications. They are used in the oil and gas, and chemical and petrochemical industries, in addition to tank storage facilities, shipbuilding and power generation. The pumps themselves are self-priming up to 8.5 mwc (metres of water column) and transport high or low viscous products which are either corrosive or neutral, clean or contaminated, in addition to lubricating and non-lubricating products. They are used as pipeline pumps, pipeline start-up pumps, slop pumps, loading and unloading pumps, circulation and transfer pumps for raw and finished products and all kinds of feedstock. A major objective for end users today is to reduce their consumption of fossil fuels and energy. This can be realised with efficient rotating machinery.

Multiple screw pumps on FPSO vessels

During the past five decades, the booming offshore activities of the oil and gas industry required new approaches to processing and transportation of the well streams from platforms and subsea fields. FPSO vessels are converted tankers or specially designed floating facilities which are divided in the topsides with modules for hydrocarbon processing equipment, storage facilities and the marine section. They are permanently moored to the seabed. FPSOs make it feasible to produce small oil fields and allow an easy relocation to another field. Flowlines and flexible risers connect drilling and wellhead platforms or subsea wells to the inlet manifold of the FPSO topsides. The well flow is boosted by single phase or multiphase pumps. Twin screw double volute, self-priming positive displacement pumps are particularly suitable for this purpose. They can handle oil, produced water and gas at high flow rates and differential pressure. After entering the inlet manifold of the FPSO, the three phases are separated in the first stage separator.

Crude oil gathering

A record number of sites are being drilled and produced across the US. These sites generally ship their crude oil by truck to a ‘central’ gathering point or terminal where it then is either shipped by pipeline or by rail to refineries. Typically the production sites will have a lease automatic custody transfer (LACT) unit or a truck loading LACT. The gathering points will typically have a truck offloading LACT where it takes the crude either directly into a pipeline or a shipping tank. If the crude goes directly into the pipeline it is especially critical to make sure the truck is completely empty while also ensuring not to introduce air into the system that could cause erroneous measurement problems.

Another record year

StocExpo 2014, which took place at the Ahoy in Rotterdam between 18-20 March, broke records with 200 companies exhibiting at the show and 2,942 people in attendance, a significant 32% boost in visitors compared with last year. The three-day conference which sits at the heart of StocExpo also attracted record numbers – almost doubling since 2013, with over 200 delegates. The conference featured talks by 20 world class speakers drawn from around the globe. They explored cutting edge industry issues, macroeconomic trends and latest technologies. Here are some of the highlights from the programme.