Ruptured Californian Pipeline Badly Corroded

By Reuters 2015-06-04 01:56:13

A section of pipeline that ruptured sending as much as 2,400 barrels of crude oil into the Santa Barbara coastline in May was severely corroded, federal regulators said on Wednesday.

Third-party inspectors estimated that corrosion of the line owned by Texas-based Plains All American Pipeline had degraded to 1/16th of an inch, said a U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) corrective action order document.

The May 19 spill dumped as much as 2,400 barrels (101,000 gallons or 382,000 liters) of crude onto a pristine stretch of the Santa Barbara coastline and into the Pacific, leaving slicks that stretched over 9 miles (14 km) along the coast and closing closed two California state beaches.

Fortunately, the spill was halted relatively soon after it began. The oil company said it shut the flow about 30 minutes after pressure irregularities were detected.

Two weeks before the spill, Plains All American Pipeline reported to the pipeline regulatory agency that the section of line where the rupture occurred had lost about 45 percent of its original wall thickness, the order said.

After the spill, third party inspectors estimated that corrosion at the site had degraded the wall thickness to an estimated 1/16 of an inch, which is greater than the 45 percent metal loss reported by Plains All American Pipeline, according to the order.

Inspectors also noted three repairs to the affected pipeline near the failure that were made due to external corrosion, the order said.

A U.S. Coast Guard captain overseeing the painstaking and arduous cleanup effort has said it may take months to restore the area to its natural condition.

The spill zone lies at the edge of a national marine sanctuary and state-designated underwater preserve teeming with whales, dolphins, sea lions, some 60 species of sea birds and more than 500 species of fish. The surrounding waters are shared by nearly two dozen offshore oil platforms.

On May 28, the U.S. Environmental Protection Agency (EPA) and the Coast Guard ordered the oil company to continue its efforts to clean up the pipeline breach and submit a written plan by June 6 that will outline measures for analyzing the spill’s effects on the environment.


Shipping could help Rohingya refugees

Commercial shipping may have a role in helping solve the plight of Rohingya fleeing Myanmar, a leading NGO source has said.
“There’s a conversation that needs to be made,” Humanitarian Policy Group research associate Lilianne Fan told IHS Maritime after the issue was discussed at a meeting in

High Mobility Coating, Welding Robot Tested

By Wendy Laursen 2015-06-03 21:50:53

A new welding robot has been trialed successfully as part of a National Shipbuilding Research Program (NSRP) project in the U.S.

The high mobility manufacturing robot (HMMR) is being developed for use in ship compartments for a wide variety of operations such as surface preparation, coating and welding tasks.

The robotic prototype features a holonomic platform that is capable of moving in any direction, is powered from a single 110V input source and has LIDAR (light detection and ranging) and sonar sensing systems for positioning and obstacle avoidance.

Every year, millions of man hours are spent performing work in enclosed ship compartments. This work is among the most labor intensive, dangerous and least touched by automation (and productivity) as any performed, says project partner Robotic Technologies of Tennessee. The work depends on highly skill laborers to perform much of the manufacturing tasks primarily in a manual fashion.

While this workforce is highly skilled in their craft, many of the productivity enhancements associated with new technologies in robotics, embedded processing and software applications have not been applied. The new system is anticipated to augment their work and significantly improve productivity and safety.

Phase 2 of the project will investigate enhancing the magnetic crawling platform with the ability to traverse stiffeners on a panel line.

The project team includes:

Robotic Technologies of Tennessee

Tennessee Tech

BAE Systems Southeast Shipyards

Ingalls Shipbuilding


VT Halter

The project began in 2014 when the Executive Control Board of NSRP selected four major research and development projects for awards as part of the program’s mission to reduce costs associated with U.S. shipbuilding and repair. The new projects are valued at approximately $6.6 million in both Navy funding and industry cost share.


WWF Affirms Arctic HFO Stance

By MarEx 2015-06-03 23:37:57

A study commissioned by WWF-Canada on marine fuel alternatives for use in the Canadian Arctic has found that the risks of using heavy fuel oil for shipping operations could be greatly reduced by switching to LNG.

“Of all the marine fuel options, heavy fuel oil is the most polluting and will cause the most damage in the event of a spill,” says David Miller, President and CEO of WWF-Canada. “The Arctic environment is so fragile and unpredictable that we must do better.”

Fuel Alternatives for Arctic Shipping was commissioned by WWF-Canada and conducted by Vard Marine, a ship design and marine engineering company based in Vancouver, BC. The study assessed the environmental impacts of heavy fuel oil (HFO), diesel, and LNG, and also compared ship design, fuel consumption, and the economic aspects of each marine fuel option.

The study found that the use of LNG reduced pollutants by up to 97 per cent. Greenhouse gas emissions were reduced by up to 25 per cent. There was also a significant reduction in the risk of environmental damage from spills, as LNG dissipates into the atmosphere almost immediately. Moving to diesel fuel was also found to have environmental advantages, but to a lesser extent.

Though the environmental advantages are clear, there are many technical and practical barriers that exist to the immediate adoption of LNG as the sole Arctic fuel. It is cheaper than diesel, but current HFO prices are lower. A conceptual design also revealed that the cost of building LNG-fueled ships would be higher than conventional options, and that no possibility exists to retrofit HFO-fueled ships currently in operation. The study makes clear that LNG is the fuel of the future for new ships to meet regulatory requirements to reduce impacts on the environment.

WWF looks to organizations like the IMO to amend the International Code for Ships Operating in Polar Waters (Polar Code) to reflect these realities. The IMO has already banned the use and carriage of HFO in the Antarctic, and similarly, Norway has banned the use in select waters. Transport Canada’s recent Tanker Safety Expert Panel also highlighted the issue and made special mention of the risks of HFO in Arctic waters.

“It’s our hope that the next edition of the Polar Code will include the phasing out and eventual ban of HFO-fueled ships in the Arctic,” says Miller. “For now we will look to both governments and industry to put nature first and make the right choice for the protection of the Arctic environment.”


Oil Chief Tell OPEC “Thanks”

By Reuters 2015-06-03 19:18:56

Six months after OPEC upended oil markets and sent prices crashing, the head of U.S. oil giant ExxonMobil has an unusual message for the cartel: thanks.

While Exxon and other large oil companies have been forced to slash spending, cut staff and sacrifice tens of billions of dollars in revenue as oil prices halved, they have also watched with quiet satisfaction as upstart rivals from the U.S. shale patch struggle simply to survive through the downturn.

The price collapse has helped shine a sharper light on the highest-cost producers, Rex Tillerson, head of the world’s largest publicly traded oil company, told a rare meeting of oil executives and OPEC ministers.

“We’re trying to discover where the marginal barrels are around the world. It’s important for all of us to know,” he said. “We are constantly chasing the price against the cost of supply.”

“We live with a lot of uncertainty and we’re rewarded for how well we manage it,” said Tillerson, one of the best-paid CEOs in the world. If you can’t live with uncertainty, “be a librarian”, he said.

OPEC decided against cutting its oil production last year to fight for market share with non-OPEC producers, thus aggravating a global oil glut that arose due to a shale boom in the United States. The group is expected to maintain that policy on Friday at its first meeting since the November decision.

Oil prices crashed to as low as $46 per barrel by early 2015 from as much as $115 in mid-2014.

Prices have recovered to around $65 per barrel in recent weeks on fears that oil companies have reduced investments too quickly and too steeply, which might result in project delays and reduced output.

Tillerson has repeatedly said the downturn was a time of opportunities to acquire rivals, although Exxon has yet to emulate a megadeal done by rival Royal Dutch Shell in April to acquire smaller competitor BG for $70 billion.

Tillerson also urged against excessive cuts amid a low oil price environment – be it capital spending or staff: “We are chasing a moving target (oil price). We always overshoot in both directions – on the way up and on the way down”.

OPEC ministers and delegates said they saw prices rising further to $70-80 per barrel, but not all CEOs agree.

The head of oil major BP, Bob Dudley, said he saw softness in prices in the second half of 2015 as global supply outpaces demand.

Weak prices might be what companies such as Exxon and BP need if they want to expand.

“If we stay lower for longer, we might see more activity in M&A (mergers and acquisitions),” Dudley said.

But besides the consolidatory impact, low oil prices could also encourage some substantial changes such as previously unheard-of partnerships between operators.

“We have always shared risk and reward through equity partnerships but we need to be more creative to keep pushing back frontiers in a $60 world,” Dudley said.

The head of French oil company Total, Patrick Pouyanne, said he was confident technology would achieve further breakthroughs to allow the U.S. shale oil industry to increase output even in an environment of low oil prices.

Asked whether he had a target price in mind for U.S. shale or Total’s operations in general, Pouyanne said: “We have a margin – not a target price. I’m not crazy to bet on one target price”.


Gas Pipeline Ruptures in Arkansas River

By MarEx 2015-06-03 19:43:51

The U.S. Coast Guard is responding to a ruptured pipeline on the Arkansas River that occurred over the weekend. The rupture is estimated to have released around four million cubic feet of natural gas, enough to fuel about 65 homes for a year.

The Arkansas Times reports that Arkansas consumed about 282.8 billion cubic feet of natural gas in 2013, approximately 774.8 million cubic feet per day.

Watchstanders with Coast Guard Sector Lower Mississippi River received a report from Jeffery Sand Company on Monday highlighting the incident at mile marker 117.3 of the Arkansas River. The company also reported damage to the port side of the towboat Chris M.

It is not yet known whether the pipeline was struck by the Chris M or if it exploded for a different reason, reports local media.

Sector Lower Mississippi River responded by deploying two pollution investigators. No visible pollution on the water was found at the time of the on scene investigation.

The river is currently closed from mile marker 116 to 118.

The pipeline will be reopened after the operator of the Texas Eastern pipeline, Spectra Energy, repairs the leak. It is anticipated that the gas in the line would bubble to the surface and dissipate into the atmosphere quickly.


Eni Manager Kidnapped in Libya

By MarEx 2015-06-03 20:09:52

A manager for Eni’s Mellitah oil and gas joint venture was kidnapped in Libya on Monday.

It is not yet clear who is responsible for the kidnapping. Libyan Yousef al-Shoumanik was taken from a Mellitah operated complex but few details are available, and no one has claimed responsibility for his disappearance so far.

Staff read out statements denouncing the kidnapping of al-Shoumani, a member of the company’s administrative management team, on Libya’s al-Nabaa television and in a video posted on a Facebook staff website. They demanded better protection for workers in the oil sector.

The Mellitah joint venture is co-owned by Italy’s Eni and Libya’s state owned National Oil Company. The companies operate the Wafa and El Feel oilfields and an oil and gas exporting facility in western Libya.

In February, Eni cut the number of foreign workers it had in the country, as Libya’s internal strife forced the closure of some fields.

Upstream Online reports that the joint venture is believed to have recently awarded OneSubsea a $330 million subsea production systems contract for work at the Bahr Essalam field in Block NC 41 off Libya.

Nation in Crisis

Libya’s public finances, wracked by a dramatic loss in oil revenue that has been exacerbated by a power struggle between rival governments, are foundering.

The crisis has prompted the authorities in Tripoli, who control much of western Libya, to plan cuts to petrol subsidies, to delay public salary payments and to ban imports from cars to steel.

“Libya is on the verge of economic and financial collapse,” U.N. Special Envoy Bernadino Leon, who has been trying to end a power struggle between the two governments, said last week.