January 2014, Vol. 241 No. 1

Advertisers from the print edition of <em>Pipeline & Gas Journal</em>, January 2014, Vol. 241 No. 1.

There is much I like about the oil and gas business. One I especially like is the industry’s innate ability to solve some of the most pressing technological problems that any business faces, though perhaps with some foresight, this might not have been necessary. That’s something I don’t like.

In late November, Lowe’s Cos. Inc., the home improvement chain, announced it would join the growing list of major trucking fleets switching to natural gas instead of diesel fuel. Walmart, UPS and FedEx are already making the move to natural gas in some trucking routes, raising the prospect that America’s natural gas highway (ANGH) could gain sufficient momentum. Clean Energy has announced its commitment to ANGH, which it says will include 150 LNG fueling stations by next year.

With the continued lack of resolution to the Keystone XL approval question, the swift change in U.S. fossil energy production rates, and the boom in unconventional sources of energy, the last few years have changed long-standing patterns of energy trade between the United States and Canada. The issues are momentous in their own right, but the U.S.-Canadian relationship is more than special: it forms the world’s largest bilateral energy market. U.S. Energy Information Administration figures account for 3 million barrels of oil and petroleum products and 11 Tcf/d of natural gas crossing the border in 2011. The U.S. Embassy in Ottawa estimates that it is a $100 billion annual partnership.

CASE Construction Equipment rolled out its new M Series dozers at the company’s proving grounds in Tomahawk, WI with the largest in its lineup – the 24-ton 2050M – tailor-made for an oil and gas industry in need of brute push-power and versatility.

The hydrological regime in the Brazilian northeast is variable. There have been in the past many cases of pipeline exposure due to huge seasonal water flow in places where, during dry periods, it’s impossible to even identify the existence of a river. The Petrobras Reabilitações do Nordeste (REAB) Project aimed to analyze a 15-year-old natural gas pipeline network in northeastern Brazil and intervene wherever the operational conditions were considered unsatisfactory. The main points of attention were river crossings.

In the wake of industry incidents and government initiatives regarding pipeline safety in recent years, pipeline operators have identified significant opportunities to enhance the governance of pipeline records and data. This article discusses options for implementing these projects, including internal staffing, using temporary staff, and strategic outsourcing. The criteria for selecting the optimal approach to project execution are discussed, along with lessons learned for improving records and data processes.

As technology and innovations continue to drive the U.S. oil and natural gas renaissance, there is similar momentum behind new approaches to the challenge of training and education for a rapidly changing workforce. The shale revolution has been characterized by continuous efficiency improvements in the drilling and pipeline sectors, and the same is true for the typical company classroom.

Israel is facing a quandary these days, one that nearly every country in the world wishes it had.

A tricky challenge for moving Alaska’s North Slope natural gas to market is designing a pipe that will remain safely buried for decades in hundreds of miles of chilled earth, permafrost and discontinuous permafrost.

P&GJ’s 2014 survey figures show 109,066 miles of pipelines are planned or under construction worldwide. Of these, 73,934 are in the planning and design phase, while 35,132 are in various stages of construction.

The materials used in fabricating offshore and onshore jackets, rigs and platforms for the oil and gas industry vary from regular mild steel to high-alloy, high-strength steels. The pipelines carrying oil and gas also consist of high-strength, high-alloy steels.

Recent gains in U.S. oil and gas production – along with the need for infrastructure to move it – has “breathed new life” into the midstream sector, which has tripled in value since 2005, according to energy analysts at Deloitte.

A national survey of executives in the oil and gas industry revealed more than 93% of companies asked have transitioned senior officers in the past two years with an “unexpectedly large number” retiring.

The power supply for Virginia's densely populated Middle Peninsula Area, on the Chesapeake Bay, is currently adequate but somewhat fragile; a single 115 kV line extends southward from the Harmony Village Substation of Dominion Virginia Power (DVP). The non-redundant power supply was at risk for long interruptions and local demand threatened to outstrip supply.

Technology advances in recent years on horizontal drilling and better methods of producing hydrocarbon resources from tight formations like shale reservoirs have had a major impact on United States energy resources. The shale-driven “revolution” has made the U.S. a leading natural gas, crude oil and liquids producer worldwide.

“I would like to thank President Obama for this opportunity,” Cheryl A. LaFleur, newly named Acting Chairman of the Federal Energy Regulatory Commission, said.

Gas transmission companies are trying to convince federal regulators to use integrity management guidelines to determine when pipe needs to be replaced outside high consequence areas (HCAs). The 2011 pipeline safety law requires the Pipeline and Hazardous Materials Safety Administration (PHMSA) to decide whether an expansion of the integrity management (IM) program beyond HCAs would eliminate the need for the class location system.

The American Association of Professional Landmen (AAPL) is helping landowners in oil and gas shale plays across the U.S. learn about the landmen living and working in their communities with two words: “meet us.”

Azure Midstream Holdings LLC has completed its acquisition from EXCO Resources Inc. and BG Group plc of 100% of the equity interest in TGGT Holdings LLC for $910 million. In a related transaction, the East Texas Gathering (ETG) System, an asset managed by Tenaska Capital, is being contributed for an additional ownership interest.

Canadian Prime Minister Stephen Harper's envoy to First Nations on western energy projects said there "has not been constructive dialogue" with aboriginal communities — something the government must take drastic steps to change if it is to win support for the projects.

Devon Energy Corp. has reached a definitive agreement to acquire GeoSouthern Energy’s assets in the Eagle Ford oil play for $6 billion. The acquired assets include current production of 53,000 Boe/d and 82,000 net acres with at least 1,200 undrilled locations. The risked recoverable resource is estimated at 400 MMBoe, the majority of which is proved reserves.

Energy Transfer Technologies (ETT) announced that 30,000 horsepower of Dual Drive CA Series natural gas compression has been installed at two natural gas processing plants in Texas, bringing the total amount of Dual Drive compression installed in 2013 to more than 89,000 horsepower.

The Federal Energy Regulatory Commission (FERC) issued a presidential permit and granting authorization allowing NET Mexico Pipeline Partners LLC to build a natural gas export facility with 2.1 Bcf/d capacity at the U.S.-Mexico border.

Don Santa, president and CEO of the Interstate Natural Gas Association of America (INGAA), summed up the feelings of many in the natural gas sector Dec. 9 when he said, “It’s nice being Number 1, but all of a sudden others are gunning for you.”

So much high-quality U.S. oil is flowing into the U.S. Gulf Coast that the price of crude there has dropped sharply and is no longer in sync with global prices.

With the final decision on the long-awaited Keystone XL pipeline still hanging in the air, energy experts from around the country will gather March 25 for the 10th Annual Pipeline Opportunities Conference at the George R. Brown Convention Center in Houston to discuss that and other key issues facing the pipeline industry in North America.

Peregrine Midstream Partners LLC announced that subsidiary Ryckman Creek Resources LLC has entered into a definitive agreement with Acqyre to provide procurement services for the rebuild of the nitrogen rejection unit (NRU) at the company's Ryckman Creek Gas Storage Facility in Uinta County, WY.

Royal Dutch Shell plc will not move forward with the proposed 140,000 bpd Gulf Coast gas-to-liquids (GTL) project in Louisiana and will suspend any further work on the project. Shell has carefully evaluated a number of development options for GTL on the Gulf Coast using natural gas feedstocks. The estimated cost of the project was $20 billion.

Natural gas production in the northeastern United States rose from 2.1 Bcf/d in 2008 to 12.3 Bcf/d in 2013. This trend has reduced the cost and increased the supply of natural gas in the Northeast.

Xpress Natural Gas announced plans to partner with Hess Energy Marketing (HEM), which was recently acquired by Direct Energy Business (DEB), to deliver compressed natural gas (CNG) to off-pipeline industrial and commercial businesses and institutions in New York state.

American Midstream Partners, LP held an open season to offer shippers an opportunity to subscribe to firm capacity on one or more versions of a proposed reconstruction of the American Midstream Midla, LLC (Midla) mainline pipeline in Louisiana and Mississippi. The open season began Nov 27 and closed Dec. 27.

Subsea construction contractor Ceona has entered into a three-year partnership agreement with Scottish welding contractor Pipeline Technique Ltd (PTL) for welding services and pipeline production management onboard the company’s flagship vessel, the Ceona Amazon.

Chevron was forced to suspend exploration for shale gas in northeastern Romania after hundreds of anti-fracking protesters tore down fences.

Concerned that declining natural gas reserves could make it a net importer in two years, Colombia plans to award a construction contract for an LNG import terminal capable of processing up to 350 NMMcf/d beginning in December 2015.

The FERC has approved construction of Columbia Gas Transmission’s Line MB Extension natural gas system modernization project in Baltimore County and Harford County, MD. The approval enables Columbia to begin construction of the 21.3-mile pipeline.

The European Commission called for European Union member states to renegotiate the terms of their agreements with Gazprom on the South Stream natural gas pipeline, saying some aspects of the project were unlawful.

Highlighting efforts to develop the next generation of young engineers and other technical workers for the global oil and gas industry, GE Oil & Gas and Kuwait Oil Co. (KOC) have launched a new competency development training collaboration.

The Greek Parliament has ratified the Host Government Agreement (HGA) it signed with the Trans Adriatic Pipeline (TAP) last year.

J.J. (Han) Fennema has been appointed to the Executive Board of N.V. Nederlandse Gasunie. He will assume the position of CEO and chairman of the Executive Board on March 1.

Iroquois Gas Transmission System, L.P. held a non-binding open season for its South-to-North (SoNo) project which would allow shippers the opportunity to deliver natural gas as far north as TransCanada Pipelines at Waddington, NY.

Ferus Natural Gas Fuels and ENN Canada Corporation have formed a joint venture to construct, own and operate two LNG liquefaction plants in Canada. The plants will be strategically located in Vancouver, BC and Edmonton, Alberta to service the on-road trucking market as well as other high-horsepower applications.

TransCanada Corp. began filling its Gulf Coast Pipeline – the southern leg of the Keystone XL project – with oil on Dec. 7.

A McDermott International Inc. subsidiary was awarded an EPCI project in the Arabian Gulf valued at US$200 million. The contract includes the fabrication, transportation and installation of offshore facilities including two production deck modules and ten observation platforms.

Navigator Energy Services, LLC announced that, due to positive shipper response for crude oil takeaway capacity on its Big Spring Gateway System, it concluded the binding open season on Dec. 13.

Oiltanking Partners, L.P has approved $200 million of crude expansion projects. The Partnership intends to construct two crude oil pipelines connecting its Houston terminal with Crossroads (sometimes referred to as Moore Road) Junction, a critical distribution point for the Houston market, for $98 million.

ONEOK Partners, L.P. will invest as much as $780 million between now and the second quarter 2016 to build a 200 MMcf/d natural gas processing facility – the Lonesome Creek plant – and related infrastructure in McKenzie County, ND in the Bakken Shale in the Williston Basin; and complete a second expansion of the Bakken NGL Pipeline, which will increase the pipeline's capacity to 160,000 bpd from 135,000 bpd.

Two of Australia’s leading LNG projects signed gas swap and infrastructure connection agreements.

The 488-meter-long hull of Shell’s Prelude floating liquefied natural gas (FLNG) facility has been floated out of dry dock at the Samsung Heavy Industries (SHI) yard in Geoje, South Korea, where the facility is under construction.

PLH Group, Inc. a company of private equity firm Energy Capital Partners, said a consortium of large petroleum pipeline companies has selected Snelson Companies, Inc., a PLH company, to build 163 miles of 20-inch pipeline and related infrastructure, as part of a larger project to transport crude oil from the Permian Basin to the Texas Gulf Coast.

A study by the National Ocean Industries Association (NOIA) and the American Petroleum Institute (API) indicates that opening the U.S. Atlantic Outer Continental Shelf (OCS) to offshore oil and natural gas development could benefit job creation, domestic investment, government revenue, and U.S. energy security.

Sun-Canadian Pipe Line restarted its pipeline in Sarnia, Ontario following approval by the Technical Standards and Safety Authority (TSSA) that provides public safety services on behalf of the government of Ontario.

Williams Partners received Federal Energy Regulatory Commission (FERC) approval to expand Transco, the nation’s largest natural gas pipeline system, to provide service to a customer’s new, gas-fired, power-generation plant in Virginia. A unit of Dominion plans to construct the 1,358-MW facility in Brunswick County to replace generating capacity from retiring coal-fired plants.

The energy consulting business is going great guns these days and little wonder, with the shale revolution continuing to change the way oil and natural gas are viewed and used in North America, and eventually the rest of the world.

The first small-scale liquefied natural gas (LNG) facility from Dresser-Rand has successfully produced LNG. The demonstration plant, known as LNGo™, was the final step prior to full market release.

Line pipe construction often requires abrupt directional changes due to topographic changes in hilly terrain, or because of installation issues occurring in in populated areas.

A new collaborative science program is pioneering the development of ultra-sensitive methane-sensing technology, following a field experiment at the Department of Energy’s (DOE) Rocky Mountain Oil Testing Center (RMOTC), 35 miles north of Casper, WY.

The SCADA system is the first line of defense for protection and oversight of any pipeline. Monitoring the various alarms and alerts in a pipeline operation’s SCADA system, however, can be like trying to drink from a fire hose. Thousands of alarm points throughout a system, all reporting 24/7, require a significant investment in alarm management, which has become the next area for major developments in SCADA design.

American Power Group (APG) received notification from the EPA that its clean alternative fuel vehicle and engine conversion submissions have been approved for use in two outside useful life (OUL) engines: • Detroit Diesel Series 60 11.1L to 14L (2002-1987) • Volvo/Mack: D11, D12, D13, D16, E7, MP7, MP8, MP10 10.8L to 16.1L (2009-2002)

New products from DeFelsko Corporation, Red Lion Controls, ORBIT, Blackstone Technology Group, CRC-Evans Pipeline International, Inc., Tigercat, Portadam, Xpress Natural Gas, Hess Energy Marketing, Direct Energy Business, McElroy and more.