September 2016, Vol. 243, No. 9

Features

GTI’s Rich History a Catalyst for Industry’s Future

With due respect to Edwin Drake who drilled the nation’s first oil well in Pennsylvania a couple of years before the Civil War broke out, and to George Mitchell and his cohorts who over a century later perfected the commercialization of horizontal drilling, micro-seismic imaging and hydraulic fracturing, today’s technology advanced through industry research and development as embodied in the Gas Technology Institute (GTI) isn’t your father’s or grandfather’s R&D. Post-fracking, it is much more complex.

Today’s R&D can involve such arcane pursuits as microbial effects on biological corrosion and studying reservoir quality deterioration, while at the same time evaluating changes in the properties of shallow aquifers, flow-back and formation water from a typical unconventional drilling job. In fact, GTI is concluding a project this year that does just that.

At the 2016 Offshore Technology Conference in Houston, the importance of R&D was underscored by participants and speakers alike, all touting an innovation-driven future for the oil and gas sector. It’s a growth-builder in terms of allowing the potential for margins to be widened, generating more capital that can be poured back into expanding the business. Teril Smith, a senior executive with Lloyd’s Register, the engineering, business and technical consulting firm that regularly completes technology surveys for various industries, noted collaboration to accelerate the spread of innovations is an essential these days.

While Mitchell’s legacy, private capital and the entrepreneurial spirit surely continue to play a key role, the continuing success in unconventional drilling also is directly related to collaborative R&D work as it was a generation ago when earlier versions of the U.S. Department of Energy (DOE) and GTI’s predecessor organization, the Gas Research Institute (GRI), helped Mitchell and others unleash fracking. As energy R&D historical buffs will confirm, the government and industry-backed R&D played a key role leading to the U.S. energy renaissance.

When GTI finishes an ongoing comprehensive data collection project on fracking, it hopes to report on impacts ranging from comprehensive geophysical well logs, side wall cores and diagnostic fracture injection tests to radioactive/chemical tracers and fiber coil production logs. During the data-gathering process, researchers will capture detailed water and air samples as a bonus. Today, the 75-year-old gas industry research organization in the Chicago suburb of Des Plaines, IL seems as spry and nimble as when it opened its doors on the eve of World War II.

The GTI report on a hydraulic fracturing test site (HFTS) will be out before the end of this year, said Diane Miller, a senior communications manager for the venerable research organization, noting much of the heavy lifting on the research was completed early in 2016. This work considers ways to reduce and minimize potential environmental impacts in horizontal shale wells while enhancing safety and reliability of the operations and improving the overall efficiency of the fracking process. “A comprehensive hydraulic fracturing data set has been collected, unlike anything ever captured before,” GTI researchers maintain.

DOE and the National Energy Technology Laboratory (NETL), along with literally two dozen companies, have been involved in this and other unconventional gas research tied to water use in the Barnett and Appalachian shales. Collaboration has been a key and GTI has served as a linchpin.

As of this spring, field data acquisition was completed for reviewing fracturing and facture diagnostics in detail on the HFTS project at the Laredo Petroleum Inc. wellsite in the Permian Basin in West Texas. Researchers were moving on to “through-fracture” core samples along with assessing the fracturing data set to gain better understanding of how induced underground fractures spread and propagate, according Miller. The data acquired has been extensive, based on the GTI listing.

“A special dedicated well [among Laredo’s 11] was drilled in the HFTS and cored through the hydraulic fractures that were created,” Miller said. “Six hundred feet of high-quality core was obtained. After analysis, this data set, including the core data, will add significantly to the knowledge base for hydraulic fracturing.”

“GTI is going to be more critical in order for the industry to develop new technologies and have a faster pace of technologies for commercialization for the industry to compete in the marketplace long term,” said Rick Murphy, managing director for sustainable growth at the Washington, D.C.-based American Gas Association (AGA), where he concentrates on programs to keep natural gas competitive in the energy marketplace and sees GTI as an invaluable ally. “The gas industry’s value proposition from an air emissions standpoint continues to get better; every year, the electric industry becomes cleaner and cleaner.”

According to the Lloyd’s Register 2015-16 Oil/Gas Technology Radar survey assessing the latest opinions of oil/gas executives globally, “operational efficiency” is currently the top driver for innovation investment. There is a keen desire to wring more value out of resources. Organizations like GTI in conjunction with industry and government sources are being relied on more than ever to improve access and extend the life of natural resources. And they strive to make that headway while not harming the environment or contributing to climate change.

Hot buttons for the executives who responded to the Lloyd’s global survey were adoption of more esoteric technologies such as 3D printing and more use of unmanned robotics. This isn’t where GTI is focused currently, officials tell P&GJ.

GTI is not always chasing the high-profile trendy projects that are in the limelight any given year, said AGA’s Betsy Tansey, a research development liaison whose specialty is leak detection and who has worked closely with GTI on projects. She sees GTI becoming a strong force in the industry, particularly for training as GTI’s work spans high tech through industrial efficiencies.

“I can see them coupling that role in training with the new design processes and information they are helping develop,” she said. “I’m not sure of the one appropriate word for that.” Maybe ‘focused’ or ‘enhanced focus,’ although she confesses not to like the word enhanced. Training is a natural extension of the call by various senior executives for the development of a stronger “innovation culture” in individual companies and the industry as a whole.

Is GTI conscious of the rather high expectations the industry carries for it? As an “insider” research arm of the gas industry, has it been able to maintain its scientific and professional credibility, particularly for regulators and peers/colleagues outside the industry? Ron Snedic, a GTI vice president with communications and development responsibilities, said the organization relies on its “independent, third-party” status, applying “sound science to provide essential factual data.”

“Our scientists and engineers take great pride in the approach, process and rigor behind any analysis, testing and reporting what we do,” added Snedic, noting this includes providing analytical services for a wide range of clients, spanning the industry, state and federal government agencies, along with the private sector.

“It is critical for GTI to provide accurate and unbiased reporting of results to maintain our credibility within the energy sector and the scientific community,” he said.

The organization seems too involved in a wide variety of collaborations to be defensive about its role in the industry. GTI shares efforts for developing new “technologies and processes” aimed at leak detection, prevention and mitigation of methane emissions.

With AGA, the Environmental Defense Fund (EDF), National Institute of Standards and Technology (NIST) and U.S. Environmental Protection Agency (EPA), GTI is part of a concerted national effort to more accurately quantify the illusive fugitive methane emissions conundrum. Throw in downstream end-use technologies and upstream production/gas operations work and that still doesn’t include the work of GTI technical experts involved in the alternative transportation fuels arena.

In leak detection, the industry uses the Hi-Flow Sampler, distributed by Heath Consultants, and originally developed by GTI engineers, who also developed the handheld portable methane detector (PMD), distributed by Sensit Technologies. “EPA incorporated some GTI/Operations Technology Development [OTD] emissions data into its recent annual Greenhouse Gas Inventory,” GTI officials point out.

“Researchers are evaluating the use of optical gas-imaging cameras to detect and quantify leaks throughout the natural gas system. Work is just starting, so there’s not much to report yet.” Stay tuned, they suggest.

AGA’s Tansey called leak detection one of GTI’s “most impactful areas.” She thinks GTI has what she calls “a pretty successful tool” on the market that companies use for pipe locating. Recent work on plastic pipe joining has proved very helpful, according to Tansey and her colleagues at AGA. GTI has helped enhance and perfect joining procedures that the industry is adopting.

She sees technology driving the gas industry more than ever, citing inline pipeline inspections as an example, and GTI as a major player in that. The federal Pipeline and Hazardous Materials Safety Administration (PHMSA) has a new regulation for requiring all transmission pipelines to go through some form of inline inspection so the inside of pipelines is looked at regularly. Tansey and others see the technology advances by industry organizations like GTI as making it possible for regulators to require a higher level of safety inspections than were possible in the past.

“We’re a slow industry to change, but in the last five to ten years we have been more ready to change, and it is because of all the technology that we now have that we didn’t have before,” Tansey said.

Tansey’s AGA colleague Murphy noted it is not widely known that GTI provides valuable analysis on regulatory issues. He said the research organization identified “significant flaws” in the DOE’s reasoning for a proposed furnace standard that surfaced in 2015 and is now being rethought by the government.

“They helped identify that there would be unintended consequences from the proposed standard that would actually increase energy consumption, emissions and costs to consumers,” Murphy said.

For a certain part of the consumer market it could be uneconomic for people to buy non-condensing furnaces, he said. As a result of the industry feedback, including work by GTI, DOE backed off, at least temporarily, and last spring was looking at an option based on the size of furnaces.

Murphy is convinced the industry has had the advantage of having a strong value proposition for years, but to retain that advantage, technology needs to be continuously advanced for which GTI is “an anchor.”

“We support the continued improvements in efficiency for gas products,” he said. “However, the rulemakings are very technical, require deep analysis, and to support the next level of efficiency we have to be sure there is technology to support it.”

In recent years, the competitive advantage of gas from an efficiency and technology standpoint has diminished relative to electric heat pumps, and organizations like AGA have to focus on and worry about the market saturation consequences, considering that gas has the vast bulk of the space heating load nationally.

“The utilization program that GTI runs, as well as its emerging technologies program, is really focused on high-efficiency gas technology,” Murphy said. “It is allowing us to begin to stop the erosion of that [historic] competitive advantage that gas has had.”

Murphy calls GTI’s role “absolutely critical now more than ever” for the gas industry in terms of both enhancing old tried-and-true technologies or advancing new ones in the combined-heat-and-power sector, or gas heat pumps. “GTI has been able to achieve advancements on both front,” he said.

GTI projects tend to be collaborative and aimed at bread-and-butter issues for the industry – fugitive methane leaks, new ways to safety check unpiggable pipelines, maintenance/inspection of large-diameter pipe and related storage. With the growing climate change-inspired anti-fossil fuel activities as embodied in the “Keep-it-in-the-Ground” campaign, the teamwork that GTI has inspired is a needed tool to continue advancements in technology and processes to keep ahead of regulatory mandates.

Pacific Gas and Electric Co.’s (PG&E) Francois Rongere, manager of research/development and innovation, notes PG&E has been a member of OTD since September 2013, working with GTI and other utilities “to help with R&D for the next generation of gas-safety technologies.” The collaborative approach, Rongere said, “brings together similar companies with the same safety goals, allowing us to leverage ideas and resources for the betterment of the industry and our customers.”

Methane emissions touches all government and private sectors of the nation, requiring “continuing close collaboration among partners in industry, government, research and academia,” GTI officials emphasize. They cite ongoing work with the AGA, EDF, NIST and EPA. GTI also is in the midst of doing state-specific work for the California Air Resources Board (CARB) on quantifying methane emissions from the tens of thousands of miles of distribution pipe in the state.

“Work will be continuing to develop additional factors for other potential sources such as customers’ meters,” said GTI’s Miller, who added that her colleagues have developed specific emission factors based on pipe material to create a means to estimate statewide methane emissions from the utility distribution systems.

GTI has developed a construction compliance monitoring system to provide field inspection intelligence and data for typical utility construction activities through a mobile platform. Enovation Partners is marketing the monitoring system in what GTI calls a “risk/compliance assurance (RCA)” solution for use in construction, leak detection, and inspection programs. “This is a statistically driven, fact-based inspection process,” GTI researchers note. “It provides a consistent record of practices, maintenance and assurance.”

This was another collaborative project with the original pilot project involving Washington Gas, Southwest Gas Corp., Atmos Energy, Consolidated Edison, National Fuel Corp. and Piedmont Gas Co. In a second phase, GTI and OTD will work to complete requested enhancements for stakeholders.

“We’re just beginning that process and expect to complete the effort by the end of 2016,” GTI officials said. “Enovation Partners and GTI’s affiliate, LocusView Solutions, have jointly provided implementation services to operators through pilot projects.”

Cracks, manufacturing and construction defects are a core cause of pipeline failures and new sensing equipment is a key to reducing these failures. Both OTD and the DoT have money in the pot. They have funded development of a bench-scale electromagnetic acoustic transducer (EMAT) that can detect potential problems in small-diameter and unpiggable pipelines. The bench test was successful, GTI said, “enabling natural gas pipeline operators to identify defects that are traditionally difficult to find and assess, improving system integrity and public safety.”

GTI officials note that work to move the technology toward commercialization is ongoing, seeking to construct and test a field prototype. “The design of the EMAT sensor is centered on the capability to find and characterize cracks in welds and pipe walls, as well as being platform-independent, allowing integration with multiple piggable and unpiggable pipe inspection platforms.”

Through the work of GTI and others, failures have been documented due to low-frequency electrical resistance welded (LF-ERW) seam defects, hook cracks, low-quality lap seams, and selective seam corrosion. GTI researchers are touting an EMAT sensor for smaller diameter (initially 6- to 16-inch) transmission pipelines to allow operators to detect cracks and other tightly fitting defects.

As a testament to their effective collaboration, PHMSA continues to invest millions of dollars into joint work of GTI and OTD, covering a wide range of gas pipeline and energy storage projects with deep safety and environmental ramifications. Developing and testing EMAT is just one of the ongoing efforts.

The efforts range from ground movement sensing systems in pipeline rights-of-way to a statistical review and gap analysis of LNG failure rates, to perhaps upgrade PHMSA’s current LNG failure rate table. This applies to key LNG plant components at a time when the United States is ushering in a new era of LNG exports.

As the commanding presence of the U.S. shale revolution and emergence of LNG exports clearly demonstrate, natural gas has a robust future, and its success depends on stepped-up innovation and technology. It’s the perfect opportunity storm for GTI.

Richard Nemec is a Los Angeles-based correspondent for P&GJ. He can be reached at rnemec@ca.rr.com.