A new deepwater midstream frontier
Sentinel Midstream has announced plans to develop Texas GulfLink, a deepwater crude oil export terminal off the Freeport coast in Texas, which will be capable of fully loading a VLCC As the US continues to enjoy record crude oil production, the pressure is growing on supply chain infrastructure to distribute crude to global markets.This flourish of crude oil production coupled with the country’s rapidly growing export market is supporting various pipeline and storage development and expansion projects to help unlock the country’s crude to international markets.According to recent Energy Information Administration data, US exports of crude oil rose to 2 million barrels per day in 2018, almost double that of 2017 figures. Likewise, US crude oil production increased 17% to 10.9 million barrels per day in 2018, with US Gulf Coast states, which are the departure point for more than 90% of US crude oil exports, producing 7.1 milion barrels per day.Recognising future demand for efficient export capabilities and to help mitigate bottlenecks at some of the country’s key production basins, Sentinel Midstream has announced plans for a deepwater crude oil export terminal more than 30 miles off the coast of Freeport, Texas.The company, which is being funded by Cresta Fund Management, will leverage its combined commercial and operational expertise to develop the facility. Between them the team has over 200 years of combined experience in the midstream sector, and more than 115 years of direct related offshore deepwater operations experience.
Regulatory update for US tank terminal operators
Jane Besch, principal at Geosyntec Consultants examines the latest regulatory updates and how they could affect tank terminal operators WATER OF THE UNITED STATES DEFINITION – WHAT’S THE LATEST?The US Environmental Protection Agency (US EPA) and the Army Corps of Engineers (COE) (the agencies) have recently proposed the second step in the two-part process to revise the definition of Waters of the United States (WOTUS). This proposed rule is intended to increase the Clean Water Act (CWA) programme predictabilityand consistency by increasing clarity as to the scope of ‘waters of the United States’ that are federally regulated under the Act.
Capturing hidden storage opportunities
Executives at Howard Energy Partners are exploring storage opportunities in key US Gulf Coast markets in responseto the growth of hydrocarbon production and exports The shale oil revolution has created a unique opportunity for Howard Energy Partner’s strategic midstream growth strategy.While other operators focus on the flourishing shale export market from the United States, Howard’s terminal division is instead focusing its growth efforts on hydrocarbon exports with neighbouring Mexico, the Caribbean and South America.The integrated midstream company currently owns and operates four strategically located terminals in the Port of Brownsville, Port Arthur, Port of Corpus Christi and Three Rivers in Texas for crude oil, natural gas liquids and refined products.However, as the export of US hydrocarbons continues to surge, the company has set its sights on further expanding into other strategic US Gulf Coast markets to take advantage of the multiple supply, trade and market opportunities.In an interview with Tank Storage Magazine Mark Helmke, senior vice president terminals & transportation at Howard Energy Partners, explains that the company’s ethos is to not just to provide terminal services, but to ultimately improve supply chain logistics for its customers.
Make room for the boom
Amid record production and export levels in the US, crude infrastructure expansions and developments are also expanding at a rapid pace, according to Genscape’s Dylan White In the last ten years, the US vastly expanded its role in the global oil supply chain. The lifting of the US crude exportban in 2015 unlocked access to international refining markets on an ever-increasing scale. Meanwhile, steep production growth allowed the US to become the world’s largest supplier of crude oil in early 2019.The rapid emergence of the US as a pivotal player in the international crude market was made possible by the widespread buildout of infrastructure. This new storage and pipeline capacity facilitated greater and more efficientflows from upstream to downstream markets. Large-scale construction projects continued through April 2019, signaling that the US crude market revolution was far from over.
From short to long - the US oil revolution
As US crude oil production continues to surge, the build out of new pipeline and storage infrastructure in key hubs is growing in momentum. DTN’s Brian Milne examines how the country is moving towards becoming a net exporter and how global trade routes are being remade for US crude oil The Energy Information Administration (EIA) projects US crude production will average 12.4 million barrels per day in 2019 and 13.1 million bpd in 2020, a 140% increase from ten years prior when crude output in the US averaged 5.5 million bpd. The rapid expansion has driven a massive buildout in US infrastructure and turned the world order on its head, transforming the US from an increasing dependency on imports to a major exporter.The US would already be a net exporter of crude oil if there was enough pipeline and export capacity, but those growing pains are being addressed expeditiously with export rates climbing while US oil is taking market share from OPEC. Rediscovering the country’s resource dominance has propelled US economic growth, including reversing a contracting manufacturing sector, and boosted employment, with the national unemployment rate at a 50-year low. Increasing oil production has allowed for a more muscular US foreign policy, including sanctioning Iran and Venezuela - two of the five founding members of OPEC – that would have pushed crude prices well above $100 bbl if not for thesupply backstop.
Optimising the US Gulf Coast energy potential
Established in 2015 in response to a need for a different midstream approach, Bluewing Midstream seeks to enter emerging markets with its portfolio of liquid bulk storage terminals on the US Gulf Coast The US Gulf Coast represents a unique opportunity in the global midstream market and Bluewing Midstream is looking to capitalise on this potential and to expand into new markets.The Houston-based company, which was created in July 2015, secured an initial equity commitment of $100 million from Energy Spectrum Partners later that year to acquire and develop oil and gas storage terminal and transportation assets focused on serving Mexico and Latin America.Since then, the company has acquired two storage terminals in the Port of Brownsville. Both facilities are located next to each other and are run as a single, synergistic operation. The company is currently in the midst of capital expansion projects adding 1.9 million barrels of new storage capacity to serve the growing import/export market in Brownsville.Currently the company operates approximately 800,000 barrels of incremental storage at the two terminals for diesel, gas, base oil, wax, jet fuel and ethanol, which represents around 50% of the total capacity. It is planning to bring a further 1.5 million barrels online over the next few months focused mainly on gas storage.
Storage stability amid a mixed production picture in the Americas
Paul Wiseman reports on a mixed oil production picture across the Americas. The US continues to set production & export records, Canada experiences continued delays in pipeline construction, Mexico promises to triple drilling in 2019 & South America sees further deterioration in Venezuela With the US rejoining the export field in 2015 after a 40-year absence, production of light, sweet crude and natural gas have flourished in worldwide markets. The investment rush to shale production that supplies those exports has pushed US production to where it rivals or exceeds that of world leaders Russia and Saudi Arabia.US production of crude oil, including lease condensates, averaged 10.9 mm bopd in 2018, according to the US Energy Information Agency (EIA). Exports reached 2 mm bopd, almost double the 1.2 mm bopd of 2017. Canada, South Korea and China were the top three of 42 destinations.The flow of oil to both import (Alberta) and export (Gulf Coast) facilities might be even greater were it not for the fact that pipeline construction has lagged behind production due to the former’s years-long lead times. While right-of-way procurement and construction take some time, delays in permitting led in part by pushback from environmental and indigenous groups has impeded construction of many pipelines.
Storage for Europe's energy transition
With directives in place requiring the EU to fulfil at least 20% of its total energy needs with renewables by 2020, the role of biofuels in the supply chain is becoming even more prominent.In addition, every EU country is required to have at least 10% of their transport fuels from renewable sources by 2020.Revisions to the renewable energy directive (RED II) by the European Commission in December 2018 aim to keep the 28 member states global leaders in renewables and to help the EU meet its emissions reduction targets under the Paris Agreement.These revisions set a new renewable energy targets for the EU for 2030 of at least 32%, with a clause for a possibleupwards revision by 2023. As part of this new directive, which is part of the clean energy for all Europeans package, all EU countries are required to draft a 10-year National Energy & Climate Plan by the end of 2019.As an increasingly popular transport fuel alternative, biofuels is having an increasingly prominent place in Europe’s energy transition.
Storage for a growing product market
With plans to invest further in used cooking oils capacity as well as improve infrastructure for bioethanol storage, Tepsa explains why storage for biofuels is increasingly important With EU directives in place to achieve 10% fuel consumption from renewable energies by 2020, the need for biofuels products and associated infrastructure will continue to grow.Despite demand for biofuels being volatile due to its links with oil products demand as well as being strongly impacted by international regulations, with an increasing focus on extracting energy from renewable sources to tackle the climate change challenge, it is certainly a growing product market. Spanish terminal operator Tepsa dedicates 15% of its capacity across its four terminals to biofuels storage – specifically for biodiesel and bioethanol. It has dedicated capacity in each of its four terminals – Barcelona, Tarragona, Valencia and Bilbao.
Should the industry rethink storage tank fire protection
Following recent high-profile fires, including the Intercontinental Terminals Company Deer Park fire, there is a renewed need for a new fire protection approach to mitigate the devastating impact these incidents can have.After the ITC Deer Park incident, the industry urgently needs to discover what went wrong and how is it possible that the fire escalated to a large blaze that lasted almost four days, resulting in the destruction of 11 tanks and two reignitions that occurred in the days after.HIGH HAZARD ENVIRONMENTSTank farms are, by their very nature, highhazard environments. No matter how stringent and encompassing a facility’s fire-safety protocols, lightning may strike at any time and equipment may malfunction. In today’s geopolitical climate, there is the present and ever-increasing threat that militants or others may target oil refineries or chemical plants.
Early detection system: the key to preventing fire incidents
In the wake of the recent fires in the Texas Area at the ITC petrochemical facility in Deer Park and the KMCO plant in Crosby (US), there has been a lot of attention cast on preventing such fire incidents from taking place in the future.In addition to the risks of a potential domino effect (where the tanks in the surrounding area also can catch fire), there are several commercial and environmental risks that can quickly sprawl out of control due to the nature of the highly combustible liquids being stored.
Evolution of cyber security within tank terminals
Ensuring a safe work environment has been at the forefront of tank terminal organisations since the beginning.Companies implemented safety measures across their organisations. Health, safety and environment (HSE) has become an integral part of tank terminal operations.The introduction of automation allowed tank terminals to improve their (primary) processes, making them more efficient and safer. However, this increases the risk of cyber incidents that can impact HSE.Cyber security risks for tank terminals are present in all forms. Threats can originate from inside and outside the organisation and are continuously evolving. This means that cyber security resilience needs to evolve as well.Tank terminal operations must be prepared by being aware of the latest threats and they must know what to do in case of a cyberattack. It is recommended that cyber security is well integrated in the operation of any tankterminal.
Optimised terminal management at your fingertips
The OpenTAS Navigator streamlines all logistics operations in a tank farm. Keeping an overview of the countless operations in a modern tank farm is a big challenge. With hundreds of trucks, trains and ships entering and leaving the plant every day, tank terminal operators must oversee and steer a multitude of storage, trade and logistics processes. At any point, they must know who is visiting them and why. And they must constantly have their assets and inventory in sight too. The Navigator, by downstream IT company Implico, is a forward-looking means to master this situation. Providing a complete digital overview of a tank farm, it leads its users stepwise through one process after another.
New generation of screw pumps for tank terminals
Logistics for oil products has been a growth business for years. Throughout the world, more and more tank farms are being built and extended. The requirements for the logistics infrastructure, the facilities for loading and unloading, for circulating and emptying, are also increasing.Pump manufacturers have adapted to the new requirements and place special emphasis with the new generation of pumps on energy consumption, environmental protection, work safety, availability and the reduction of operating costs for tank farm operators.Increasingly important is flexibility. The pumps should be profitable in conveying different oil products. In particular, the viscosity of the products to be conveyed should not play a role for the pumps. Modern pumps are expectedto convey low viscosity oil products (e.g. gas oil) as effectively as high viscosity products (e.g. bitumen).
How to avoid insurance renewal surprises
Lightning Master’s Bruce Kaiser explains how operators and owners can mitigate significant increases in insurance renewal costs with an interim standard for lightning protection & supplemental insurance As Ben Franklin, ironically of lightning rod fame, once said, ‘In this world nothing can be said to be certain, except death and taxes’. Well, he was almost correct. He forgot about insurance cost increases.As a result of increased claims activity from lightning strikes, many insurance companies are now restricting or excluding coverage for lightning damage. This is passed along to owner/operators who discover at the time of policyrenewal that if coverage has not been excluded then insurers have at least imposed higher rates or higher deductibles, or both in some cases.In the case of higher deductibles, insurers are increasing these not just a little, but a lot. It is not unusual to see the deductible for lightning damage jump from $50,000 to $500,000. This is unreasonably and particularly burdensome for operators in high lightning areas.
Evolving US regulations impact chemical storage tanks
The Fiberglass Reinforced Plastics Institute introduces industry’s first comprehensive full fledged fiberglass tank inspector certification practice Storing chemicals is a highly hazardous operation in the oil and gas industry. Although chemicals are not flammableand explosive in nature, they are very corrosive and can cause injury, fatalities and environmental damage if not safely contained.Fiberglass Reinforced Plastic (FRP) is the material of choice most often for aboveground storage tanks (AST’s) in chemical service due to its corrosion resistance. FRP AST’s are substantially smaller in storage capacity than steel AST’s storing oil, where regulations and industry standards development has focused more on oil applications. Consequently, FRP AST’s in chemical service have been at risk.To address these challenges and provide safer operations, the Fiberglass Reinforced PlasticsInstitute (FRPI) introduced the industry’s first comprehensive full-fledged fiberglass tank inspector certification practice on October 8,2018.
Challenging loading arm convention & safe access with innovation
The integration of modern technology and working practices into mature life-cycle equipment can be difficult to achieve. Entrenched methods of working, generational lack of investment and third-party interests conspire to restrict innovation.The evolution of the tanker loading process has been ‘glacial’. This is not due to any single reason, although money is often cited as one of the primary factors. But, is that still a justifiable reason to reject change? Miniaturisation and lowering costs for electronics, instruments and processing power now mean we have all the tools available to transform how we do most things. If you think about industries that have not been changed by technology, then we can narrow it down to a few including embalmers and barbers.Tanker filling is a dangerous and labour-intensive process. The implication for getting it wrong can get you on global news headlines the same day. Probably not the publicity you are hoping for.
Why use duplex stainless steels for storage tanks
Tank manufacturers can reduce material weight and cut costs by specifying storage tanks madefrom high-strength duplex stainless steel Steel storage tanks are vital for the day-to-day operation of the biofuels and chemical industries. However, there isa huge variety between the alloy content and production of different types of steel – and the mechanical strength and corrosion resistance can vary widely.COST EFFICIENCYWhen specifying a tank, it’s important to choose the best material based on the tank’s total lifecycle cost. Designers need to weigh up a whole range of factors when comparing tank options: material cost, welding, assembly and local labour costs, as well as the price for applying and maintaining internal and external surface treatments. It’s also important not to overlook the value of scrap material at the end of the tank’s life.Looking at it holistically, the raw material costs are only a fraction of the total lifecycle cost of a tank. Therefore, it’s worth considering high-performance duplex stainless steel as it may be more cost efficient in the long term.