March 2015, Vol. 242, No. 3

Advertisers from the print edition of <em>Pipeline & Gas Journal</em>, March 2015, Vol. 242, No. 3.

You already know that Houston is the energy capital of the nation, most likely the world. But did you know that Houston is also the violent bank robbery capital of the nation with no close second?

In recent years, the technological advances in recovering hydrocarbons trapped in tight formations, like shale, using unconventional drilling methods (horizontal drilling in conjunction with multi-stage hydraulic fracturing) have made U.S. oil production grow dramatically.

If you are lucky enough to have grown up in Texas, you are all too familiar with how popular culture, particularly Hollywood, has glamorized the life of a wildcatter or roughneck. The movie Giant depicts James Dean on a windswept Texas countryside, sopping head to toe in newly discovered oil. While maybe a compelling drama, as a Texas Railroad Commissioner, I can tell you this is far from reality.

NYSEARCH/Northeast Gas Association (NGA) and development partner Invodane Engineering have introduced the Explorer series of robotic internal inspection platforms and sensors which can perform integrity assessments on natural gas pipelines now incapable of using conventional inline inspection (ILI) technology. The commercial partner on the project is Pipetel Technologies Inc.

Recently EnLink Midstream invited me out to West Texas to see my first pipeline spread – the Martin County Extension Pipeline. On the way to the line we stopped by the Deadwood gas plant where I met Chris Coleman, EnLink Midstream’s senior landman. He was amiable, genuine and welcoming, even letting me ride shotgun in his work truck, which I had to jump to get into. As we drove across the flat Texas land, kicking up a flurry of red dirt, he began telling me about his job.

Recently EnLink Midstream invited me out to West Texas to see my first pipeline spread – the Martin County Extension Pipeline. On the way to the line we stopped by the Deadwood gas plant where I met Chris Coleman, EnLink Midstream’s senior landman. He was amiable, genuine and welcoming, even letting me ride shotgun in his work truck, which I had to jump to get into. As we drove across the flat Texas land, kicking up a flurry of red dirt, he began telling me about his job.

The free-falling oil price caught many observers off guard. Historically, crude oil and natural gas prices tend to stay in alignment as the imbedded energy content is the defining characteristic. Since 2010, when the price of these commodities separated, many observers anticipated upward volatility in the price of gas to realign it with the price of oil. Few analysts anticipated oil falling to realign with low-cost natural gas.

The price of oil may have fallen to its lowest level in six years, but this “price shock” is different than the 2008-’09 variety, according to analysts at Pace Global. “The current low-price situation is likely to persist for several years unless geopolitical events shift the market psychology from one of surplus to one of shortage,” Jim Diemer, vice president and head Pace Global-Siemens’ Energy Consulting Company, told PG&J.

EPA Administrator Gina McCarthy calls our nation’s natural gas abundance “a game-changer in our ability to really move forward with pollution reductions.” She’s right. Expanding natural gas use for power generation is the primary reason the U.S. has reduced carbon emissions more than any other country over the past eight years and driven sulfur dioxide and smog-forming NOx emissions down by more than two-thirds over the past two decades.

The late 19th century’s most brilliant businessman, J.D. Rockefeller, was an oil tycoon who discovered that the best way to take advantage of his country’s growing thirst for oil was to control distribution. Although the pipeline that Rockefeller built in the 1870s wouldn’t look like much compared to today’s sophisticated pipeline networks, it was an engineering feat that helped his company ensure oil got to the clients who needed it most.

Crude from the Canadian oil sands deposits gained an additional major outlet in the U.S. when the joint venture of Enbridge, Inc. and Enterprise Products Partners L.P. completed construction of its Cushing-to-Texas pipeline and started deliveries in December to Gulf Coast refineries. The new pipeline’s operations and routes are very similar to TransCanada’s Keystone Pipeline project for bringing oil sands crude to the Gulf Coast.

Russia is the second-largest producer of dry natural gas and the third-largest liquid fuels producer in the world, and these products are inextricably intertwined with its government. State-controlled company Rosneft dominates oil production while Transneft owns and operates Russia’s oil pipelines. Gazprom is the country’s dominant gas producer and pipeline operator, and the Ministry of Finance admitted in February that oil and gas royalties, taxes and dividends account for at least 50% of the Russian government’s revenue.

Valve misalignments are a real issue in the petrochemical industry where misalignments in tank fields and blending areas can result in financial losses from product quality and environmental safety issues. This article describes an electronic pin board software solution developed by Matrix Technologies, Inc., a certified member of the Control System Integrators Association (CSIA), to mitigate valve misalignments and improve efficiency in the alignment process. It also details some of the underlying technologies used in the software and the gains that have resulted from its use.

In 2013, SGS PfiNDE received a call from a client pipeline company which transports a light hydrocarbon product with entrained particulate and sediment through a 150-mile section of pipeline in Minnesota. The company encountered a challenge when, after cleaning the first 20-mile section of the pipeline, the cleaning tool became blocked by, what was determined to be, the excessive buildup of sediment in front of the cleaning tool. Due to the large amount of sediment in this particular line, the tool had gathered enough sludge to completely stop any further progress of the cleaning pig.

Global consulting company Wood Mackenzie has drawn on the knowledge and expertise of senior analysts in compiling a new report, Horizons: What To Look For In 2015. In discussing the report, Paul McConnell, principal analyst for Global Trends at Wood Mackenzie, pointed out that oil market concerns will be inescapable in 2015. “With no sign that OPEC is reconsidering its decision to leave production targets unchanged, the impetus falls on non-OPEC producers to limit supply growth and bring the market back into balance,” he said.

In summer 2011, executives at super-major ExxonMobil were telling financial analysts during a quarterly earnings conference call about an amazing 70% boost in a year’s time of the energy giant’s unconventional natural gas-weighted portfolio to 76 Tcfe. The reason was simple, according to David Rosenthal, the current controller at ExxonMobil and at the time its investor relations chief. He summed it up in three letters, X-T-O.

A new National Transportation Safety Board (NTSB) study calls for major changes to integrity management (IM) programs of gas transmission pipelines in high-consequence areas (HCAs).

The Texas Railroad Commission adopted new rules in December concerning pipeline permit applications involving 16 Texas Administrative Code §3.70. It has been three years since the state Supreme Court’s opinion in Denbury Green, which took a dim view of the commission’s “check the box” rules regarding Form T-4 pipeline permit application which automatically created common carrier status to the pipeline operator.

The EnLink Midstream companies, EnLink Midstream Partners LP and EnLink Midstream LLC, announced a definitive agreement to acquire Coronado Midstream Holdings LLC, which owns natural gas gathering and processing facilities in the Permian Basin.

Northeast Utilities, which operates New England’s largest energy delivery company, has become Eversource Energy. All of the company’s subsidiaries, including Connecticut Light and Power Co., NSTAR Electric, NSTAR Gas, Public Service Co. of New Hampshire, Western Massachusetts Electric Co. and Yankee Gas Services Co. have begun operating under the Eversource brand. The company serves more than 3.6 million electric and natural gas customers in Connecticut, Massachusetts and New Hampshire, and employing a workforce of more than 8,000 New Englanders.

Spectra, in partnership with The Mosaic Co., held a Gas & Pipeline Industry Training Roundtable Feb. 5-6 in Houston. The forum was held to share best practices in training and create a dialogue among industry leaders to better identify how gas and pipeline companies can enhance their training programs.

The Mountain Valley Pipeline (MVP) will provide 2 Bcf/d of natural gas transportation capacity from the the Marcellus and Utica production areas to the Mid- and South-Atlantic regions by the end of 2018 if all goes as planned. The 300-mile pipeline, a joint venture of EQT Midstream Partners and NextEra U.S. Gas Assets, will run from northwest West Virginia to southern Virginia, extending the Equitrans transmission system to Transcontinental Gas Pipeline Company’s compressor station in Pittsylvania County, VA. EQT Midstream will operate the pipeline and own a majority interest.

Everyone with the word manager in front of his name thinks they have the abilities needed to lead others in their organization. Lee J. Laviolette, managing director of the newly expanded energy practice for Navigant Consulting, has his own definition. It’s simple and it works. “Leadership of change is all about people. Only people can raise an organization's performance."

With a name like Steele in Pennsylvania, you’d expect Steele Construction, Inc. owner Bill Steele to specialize in structural steel building or own a foundry. Instead, he’s one of the premier builders of timber-framed homes in the state. As things changed and housing starts dipped during the recession beginning in 2007, Steele expanded his business on the strength of the Marcellus Shale natural gas boom. “We were lucky enough to get into a gas contract, and now our company is pretty much evenly split between the building of heavy timber frame and moving dirt,” said Steele.

Perhaps one of the most important safe guards put in place to maintain the long-term integrity of buried pipelines is a cathodic protection system. Cathodic protection (CP) is an anti- corrosion technique used to prevent the corrosion of metals such as steel and iron in electrolytically conducting environments such as seawater and soils containing water.

People who work in the oil and gas pipeline industry have a convenient new way to locate experts, equipment and software they need for integrating control systems at their facilities. The Industrial Automation Exchange is an online community introduced last year by the only nonprofit, trade association for system integrators, the Control System Integrators Association (CSIA). The community features profiles of system integrators and industry suppliers as well as a clearinghouse for information about industrial automation.

Corrosion, erosion and other forms of material degradation can cause critical damage to steel pipelines and riser systems, potentially resulting in health and safety hazards and costly repairs for oil and gas operators. Inspection technologies are available to evaluate pipeline integrity, and as a result, maximize the economic recovery of oil and gas reserves.

In the last several decades, there has been a rapid rise in the use of pipeline risk assessment for managing pipeline safety. It has become an important part of pipeline integrity management, but risk assessment is not an absolute science.

Southampton, NJ-based Point Integrity Solutions has been issued a patent for the pipeline probe tool known as the Point Guard. This enhances the ability of pipeline technicians to detect the pipe before damaging the coating or pipe itself. Typically, field engineers and technicians rely on mapping, pipe locators and standard probe rods to determine the location of a pipeline before excavation begins. This allows for a chance of pipe or coating damage if a probe rod is applied with too much force or a probe mistakes a rock or hard surface for a pipeline.

The need for reliable, rapid pipeline inspection systems and services is growing as the pipeline network, both domestic and international, ages and expands. Inspection and defect reporting have become time-sensitive as incident prevention becomes a top priority.

New products and services from Microfinish, Master Bond, WorkPlaceAware, Romet, Pipetech and more.