Tank Storage magazine July/Aug 2013

The voice of the storage terminal industry

July/August 2013

Volume No. 9 Issue No. 4

Playing the long game Eduard Ruijs, director at First Reserve, explains what he looks for in a terminal investment partnership

Uruguay gets connected The country gets its first independent tank terminal with a pipeline connection to a port

Australia: a wealth of opportunities

Includes chemical storage supplement

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RE O M S NO ach e d a e h

Benefits at a glance • Maximum tank storage capacity is maintained • No electricity or separate power required as unit operates from the existing feed pump • Minimal service requirements with the units typically operating 15 years between services • Eliminates water trapping which can contribute to corrosion of the tank floor leading to costly repair bills • Considerable cost savings due to reduced tank outage

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Margaret Dunn Publisher

SUMMER SPECIAL Tank Storage magazine has always been big on exposure. Rather than just bringing out a magazine every few weeks, we’ve always made sure each issue is tied closely to a major industry event, while also concentrating on a specific region.

Our last issue, for example, was the gold sponsor at ILTA and focused on the infrastructure boom in the US. And the one before that was in the delegate bags at StocExpo and detailed the market across Europe.

So during the summer, when the conference season gives way to more leisurely travels, we normally use this time to focus on other projects.

But not this year. With so much going on, it was an easy decision to add a bonus issue.

What wasn’t such an easy decision, however, was how to decide which region to focus on.

People have been asking us how the political turmoil in Turkey might impact the sector and how the economic instability is impacting Cyprus.

TANK STORAGE • July/August 2013

But at the same time, with the Brazilian government authorising 50 new private port terminals and news that the Panama Canal Authority is considering a fourth set of new locks as part of its $5.2 billion expansion project, we wanted to take a closer look at South America.

But we also can’t ignore the impact Australia’s bleak refinery outlook is having on storage operators there.

So rather than having to choose, we’ve covered them all!

We do hear from workaholics who put Tank Storage magazine in their suitcases, but if that’s a step too far for you at least you can rest assured that the issue will be waiting for you upon your return.

Wishing you safe travels.

Best wishes, Margaret

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contents

july/august 2013 Volume 9 issue 4 Horseshoe Media Ltd Marshall House 124 Middleton Road, Morden, Surrey SM4 6RW, UK www.tankstoragemag.com

MANAGING DIRECTOR Peter Patterson Tel: +44(0)20 8648 7082 peter@horseshoemedia.com

Publisher & editor Margaret Dunn Tel: +44 (0)20 8687 4126 margaret@tankstoragemag.com

contents news 1 Comment 2 Contents 4 Terminal news 23 Technical news 37 Incident report

Deputy editor James Barrett Tel: +44 (0)20 8687 4146 james@tankstoragemag.com

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Assistant Editor Keeley Downey Tel: +44 (0)20 8687 4183 keeley@horseshoemedia.com

Advertising Sales manager David Kelly Tel: +44 (0)203 551 5754 david@tankstoragemag.com

PRODUCTION Alison Balmer Tel: +44 (0)1673 876143 alisonbalmer@btconnect.com

SUBSCRIPTION RATES A one-year, 6-issue subscription costs £150 (approximately $240/€185 depending on daily exchange rates). Individual back issues can be purchased at a cost of £30 each Contact: Lisa Lee Tel: +44 (0)20 8687 4160 Fax: +44 (0)20 8687 4130 marketing@horseshoemedia.com

Uruguay gets connected The country gets its first independent tank terminal with a pipeline connection to a port

features 39 Tank terminal update: Turkey 40 Tank terminal update: South America 47 Opening up the Pana-ramic view

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Full Brazilian?

With the approval of 52 new private port terminals, the country is set for significant growth

Tank Storage magazine catches up with a project in Panama aimed at widening its famous canal to increase options for bunker and liquid cargo storage

49 Turkey: more pros than cons 53 Is Turkey a safe bet?

Follow us on Twitter: @tankstorageinfo No part of this publication may be reproduced or stored in any form by any mechanical, electronic, photocopying, recording or other means without the prior written consent of the publisher. Whilst the information and articles in Tank Storage are published in good faith and every effort is made to check accuracy, readers should verify facts and statements direct with official sources before acting on them as the publisher can accept no responsibility in this respect. Any opinions expressed in this magazine should not be construed as those of the publisher.

ISSN 1750-841X

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July/August 2013 • TANK STORAGE

contents

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A mate for life Vopak’s CIO Ton van Dijk speaks about the company’s implementation of a new automation system across its 84 terminal locations

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Stand and deliver One specialist training provider explains the approach it takes to teach storage terminal operators good PPE practices in just 35 minutes

See inside for chemical storage supplement

PPE

To olBox Talk

features 54 Australia: a wealth of opportunities 58 Playing the long game

Eduard Ruijs, director at First Reserve, explains what he looks for in a terminal investment partnership 61 Combatting a multimillion dollar problem 65 Cyprus’crisis

As Cyprus tries to mortgage its energy future, a $300 million oil terminal ramps up construction at the southern port of Vasilikos to capitalise on the island’s location

features

The voice of the storage terminal industry

JULY/AUGUST 2013

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Hats off to Vopak’s terminal in Laurenshaven

TANK STORAGE • July/August 2013

74 Get pulled in by magnet-drive pumps

This leakage-free alternative cuts emissions and reduces maintenance requirements

Volume No. 9 Issue No. 4

Playing the long game Eduard Ruijs, director at First Reserve, explains what he looks for in a terminal investment partnership

Uruguay gets connected The country gets its first independent tank terminal with a pipeline connection to a port

Australia: a wealth of opportunities

75 In the wake of one storm and the lead up to another...

77 Events listings

Ad index

INCLUDES CHEMICAL STORAGE SUPPLEMENT FC_TSM_July-AUg_2013.indd 1

Front cover courtesy of Veolia Environmental Services

17/07/2013 10:48

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terminal news

Brazil exports first load of biodiesel to Rotterdam port The Port of Rotterdam has received the first load of biodiesel ever to be exported from Brazil for commercial purposes.

Brazilian biofuel producer BSBios shipped 22 tonnes of biodiesel to the port after it received authorisation from the National Agency of Petroleum, Natural Gas and Biofuels to export the fuel back in 2008.

‘BSBios has tried to make partnerships official to export biofuel,’ explains

the company’s CEO Erasmo Carlos Battistella. ‘There are many difficulties, with relation to taxes mainly, which cost Brazil and make negotiations difficult with the European market. This is an important advance we need to fulfil to demonstrate that Brazil can also export biodiesel.

BSBios has two plants, one in Marialva, Parana and a second in Passo Fundo in Rio Grande do Sul, with a total production capacity of 350 million litres a year.

BSBios exported over 20 tonnes of biofuel to the Port of Rotterdam

Odfjell JV to build storage terminal in China Odfjell Terminals and the Founder Group will enter into a 50/50 joint venture to develop a petrochemical tank terminal in Quanzhou in China’s Fujian province.

Under the newly signed agreement Odfjell will build, manage and operate a new tank terminal. It will first invest $21 million (€16 million) for a 50% equity share in Fujian Fangtong Terminals from Founder Group, including the land and existing jetty.

The technical design review and engineering are now

underway, with the basic design of the terminal scheduled to be completed and ready for project tender by the end of this year.

The total investment in the terminal currently stands at $137 million and Odfjell Terminals Fujian says it is scheduled to enter service at the beginning of 2016.

The terminal will be located on 14.8 hectares of land, enough to build a total 184,000m3 of storage capacity, in addition to two jetties (5,000 dwt and 100,000 dwt). However,

the venture could expand the facility by 400,000m3 in the future as it will have the option to purchase an extra 23 hectares of nearby land.

‘Odfjell Terminals is embarking on another large tank terminal project in China, adding to its two existing terminals and the new facility already under construction in Tianjin,’ Jan Hammer, Odfjell SE CEO and president confirms. ‘We have found a solid partner for this project in the Founder Group, which is a corporation owned by the Peking University in China.’

Magellan Midstream closes pipeline acquisition

NuStar grows St. James terminal

Magellan Midstream Partners has finalised the acquisition of pipeline assets from Plains All American Pipeline.

The purchase includes around 250 miles of pipelines used to transport refined petroleum products from El Paso, Texas to Albuquerque in New Mexico and to the USMexico border for delivery within Mexico via a third-party pipeline.

Magellan acquired the infrastructure for $57 million (€43.8 million), which it funded with cash on hand.

‘This pipeline system serves as a natural extension of our existing refined products pipeline system, with

NuStar Energy’s St. James crude terminal in Louisiana, US could soon begin handling heavy Canadian oil, according to global news.

The terminal operator is developing a new unit train facility with a 70,000 bpd capacity, which could be operational by the end of this year.

Increasing production of crude in Canada and North Dakota means NuStar is ramping up its rail unloading, storage and dock capacities at the St. James terminal; during 2013 and 2014 an additional 799,000 bpd of output is due to come online.

Speaking to Bloomberg, Danny Oliver, senior VP of marketing and business development, said: ‘We’re trying to be as accessible to as many types of crude as we can be. We’re talking with Bakken producers but we’re also talking with Canadian producers about moving dilbit [diluted bitumen].’

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current connections in the El Paso market,’ explains Michael Mears, CEO. ‘With this newly acquired pipeline system, Magellan is able to provide options for customers in Albuquerque and central New Mexico to access refined products from West Texas, Gulf Coast and Mid-Continent refiners.’

In addition to this, Magellan is also in the process of purchasing the Rocky Mountain pipeline system which is subject to approval by the Federal Trade Commission. This includes approximately 550 miles of pipelines which distribute refined petroleum products in Colorado, South Dakota and Wyoming.

July/August 2013 • TANK STORAGE

terminal news

TANK STORAGE • July/August 2013

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terminal news

ODT ramps up storage in Spain A new storage facility is under construction at the Port of Malaga, Spain.

Oil Distribution Terminals (ODT), a Spanish bulk liquid terminal provider, is behind the new project. The company already owns a 6,500m3 fuel oil storage terminal at the port but with no other petroleum products terminals on the site currently serving the bunkering market or the inland distribution petrol network, ODT believes there are opportunities to be had by building a second.

The Port of Malaga is the only port in southern Spain, and the only one among competing container/cruiser ports, not to have a petroleum products terminal.

‘The Port of Malaga enjoys advanced infrastructure such as a deep draught (16m), a commercial rail line to terminals, an option to connect to the national pipeline network, and an international airport 10 minutes away,’ Antonio Martinez-Laredo of Oil Distribution Terminals says. ‘It also has one loading/unloading-dedicated 180m jetty, plus five direct bunkering points along a 750m quay with 700m3/ hr capacity and coriolis flow meter.’

The facility will be built in phases, the first of which is to include seven tanks with a combined storage capacity of around 34,500m3 and 100m2 storage for lubs and ads. This volume is slated to come online at the beginning of 2015, storing products such as middle distillates with a flash point

above 55°C (gasoil and diesel), heavy residuals (fuel oil) and pure FAME, with online blenders for biodiesel and IFOs and additivation kits.

An artist’s representation of ODT’s new 34,500m3 terminal A second phase of an 3 additional 11,000m capacity will be implemented according greatly contributed towards obtaining the to demand, and there is enough space location and the permitting for the new to build a total 60,000m3 at the port. project,’ he told Tank Storage magazine.

‘The terminal has been designed with ‘Additionally, all counterparts do expansion in mind,’ Martinez-Laredo says. understand and share the view that the Port The construction, estimated to cost of Malaga and Malaga province need a around €12 million, will be carried out by petroleum products terminal that will help number of subcontractors. ‘Carinox will build grow existing port traffic and improve retail the tanks and has been approved by Repsol diesel pricing, as Malaga is the third most and CLH. This supports the local industry as its expensive diesel at the pump province factory is 50km from Malaga Port,’ Martinezin Spain’ he adds. ‘Local authorities are Laredo reveals. ‘Automation, control and also aware of this inefficiency and value management shall be implemented by the opportunity of enjoying a petroleum southern Spain-based Montrel, approved products terminal that will distribute to

by CEPSA and DECAL,’ he adds. an estimated 150,000 million tonnes per Asked what challenges could present year bunkering market and to an existing themselves when building this second, much 48,000m3 per month terrestrial market.’ larger terminal Martinez-Laredo described ODT’s new terminal will have the the existing facility as a ‘trial’ that helped capability to berth medium range ODT establish relationships with port, town vessels which, Martinez-Laredo says, hall, environment and industry authorities. will receive products from across the He says it also helped his company gain world, from US Gulf-, Baltic-, ARA-, and recognition and credibility within the market.

Mediterranean-based refineries.

‘As such, the successful experience The terminal will operate under ISO gained planning, developing, implementing 14001, ISO 9001, and will feature an and operating the existing terminal has ISO 17015 certified laboratory.

Baltchem finalises terminal expansion Baltchem’s recently expanded bulk liquids storage terminal, located in Szczecin, Kujota in Poland, will soon be 100% operational as the final tank nears completion.

The storage terminal owner began expanding its facility in 2006, adding a new tank each year. Today it comprises seven new tanks, in addition to the existing 13 which range in size from 200m3 to 3,600m3, storing

a number of products including diesel, petrol, heating oil, methanol and FAME, fertilisers.

Capacities for these new tanks vary between 4,000 and 7,500m3 ‘We started building the final tank in March and it will be complete by September,’ reveals Wojciech Król, head of marketing for Baltchem. ‘The construction contract was awarded to KB Pomorze as they offered to build the tanks

Baltchem’s terminal in Kujota is growing

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within the fastest timeframe and at a good price.’

In 2014, following the completion of the seventh and final tank, Baltchem plans to break ground on three more tanks totalling 24,000m3 for the storage of heavy fuel oil. ‘The first one is scheduled to be finished by the end of 2014,’ Król tells Tank Storage magazine.

And, alongside the construction of these three heavy fuel oil tanks, Baltchem is also looking to develop a new chemical storage cluster comprising six 3,000m3 tanks for chemical products such as benzene, toulene, xylene and acetone and many others chemicals.

While it is still too early to say where the products filling Baltchem’s additional capacity will come from, or

indeed be exported to, existing infrastructure at the terminal means it will be transported either via barge, rail or truck.

The company is also looking into the possibility of extending its jetty and deepening the draft to allow for the receipt of larger vessels.

Król believes the Szczecin terminal, which offers blending and additives services in addition to five heated tanks, is located in a strategic location which could prove particularly beneficial to customers located in eastern Germany.

‘The river Odra which runs through Szczecin is connected to Berlin’s Havel river via a canal,’ he says. ‘This means large-scale ships can offload products at Szczecin before being transported via barges to Berlin.’

July/August 2013 • TANK STORAGE

terminal news

Uganda plans new crude pipeline for export activities Uganda is planning to become an exporter of crude oil and boost its oil industry with the construction of a new pipeline from its oilfields to Kenya’s new Lamu Port, currently under construction.

The pipeline to Lamu Port would also provide a crude export route for South Sudan.

The country currently relies on a pipeline running through Sudan but bad relations between the two nations have seen supplies disrupted in the past.

Uganda hopes to start crude output in 2016 and is also planning to bring a new 30,000 bpd refinery online by 2017.

In addition, it has been reported that the presidents of Uganda, Kenya and Rwanda are keen to expand an existing pipeline that originates

at Kenya’s Mombasa port.

The pipeline currently stops inside Kenya but talks are now underway to extend it into Uganda and Rwanda.

Uganda’s foreign minister Sam Kutesa was quoted as saying: ‘It was agreed that we develop two oil pipelines – A new pipeline would connect Uganda’s oilfields to Kenya’s Lamu Port one pipeline that currently exists and brings products from to get these two projects previously estimated the cost Mombasa to Eldorect [in off the ground has not of a pipeline to Lamu Port Kenya] should be extended been disclosed, nor has the at $3 billion (€2.3 billion). The to Kampala and Rwanda.’ completion dates, but South latter pipeline project could be The investment needed Sudan is reported to have in the region of $300 million.

New 24-hour oil terminal opens in Chile In Chile, state-owned oil refiner ENAP has opened its new $140 million (€105 million) terminal for the loading and unloading of liquids in San Vicente Bay. Inaugurated in June by energy minister Jorge Bunster and the company’s GM Ricardo Cruzat, the new oil dock replaces ENAP’s existing terminal facilities. In a statement the company said it is a ‘significant leap in technology and safety for the loading and unloading of oil and fuels’.

Bunster says: ‘Along with providing security for all operations that are

generated in the Bay of San Vicente, this dock strengthens the logistics and ensures a reliable and continuous delivery of fuels needed in Chile.’

The oil dock has been carrying out trial operations since November last year and, during its first months of operation, has received more than 100 ships with over 3.3 million m3 of loading and unloading capacity. The dock is open 24 hours a day.

The investment included a new control room from where the terminal is managed remotely and all the dock’s activities are controlled online. Additionally,

more than 500m of pipelines of different diameters have been installed to carry a number of different products. Oil will be transported along these pipes to and from the Bio Bio Refinery in Hualpen, which supplies 32% of Chile’s fuel demand.

Exposed pipelines simplify maintenance and inspection, while the fire detection and fire control system is fed with seawater.

The technology enables the terminal to operate ships continuously, simultaneously and with a higher unloading speed (due to larger diameter pipes and operation of larger vessels).

Connect quickly – safely www.rs-seliger.de rs813gb-kleinanzeigen-2013-tr-en-185x60-end.indd 1

TANK STORAGE • July/August 2013

02.01.2013 09:38:30

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terminal news

ITC building tank terminal in Texas Intercontinental Terminal (ITC), a 100%-owned subsidiary of Mitsui, is progressing with its new tank terminal in Texas, US after breaking ground in May. In 2010 ITC acquired 180 acres of land for JPY18 billion (€140 million) on which to build the terminal.

With water access in Pasadena, Texas, the 10 tank terminal will also

feature ship docking facilities.

Mitsui said in a statement: ‘Although the shale gas boom provides a tailwind for the region as a hub for the petroleum, gases and petrochemical manufacturing industries and tank demand is expected to increase greatly, limited space to expand in is becoming an issue.’

Crosstex resumes operations at Black Run rail terminal US-headquartered integrated midstream energy partnership Crosstex Energy has put back into service its Black Run rail loading terminal.

The terminal is located in Frazeysburg, Ohio and its reactivation will see exports of Utica Shale light oil condensate production resumed.

The facility comprises a 20-car rail rack with tracking gangways designed to top load a number of products, including light oil condensate and various grades of crude oil, at a rate

of 24,000 bpd. Crosstex Energy says the terminal is the first of its kind to ‘move light oil condensate out of the region to premium-priced refinery and petrochemical markets’.

‘The re-activation of our Black Run rail facility enables us to offer producer customers in the Utica Shale an immediate midstream solution to export their products to out-ofregion markets to maximise value for our customers,’ says Crosstex president and CEO Barry Davis.

Williams progresses with Bluegrass Pipeline Project Williams, an energy infrastructure company, is to go ahead with its Bluegrass Pipeline project after it was approved by its board of directors.

The natural gas-to-liquids pipeline will transport product from the shale gas regions of Marcellus and Utica to export markets in the US Gulf Coast. It will also connect NGL supply with the developing petrochemical market in the US’ northeast.

Development work on the new infrastructure is already underway, with the pipeline expected to enter service in late 2015.

In May, Williams partnered with Boardwalk Pipeline Partners for the pipeline and related fractionation, storage and export activities.

The project will be developed in phases, the

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first of which includes 200,000 bpd of capacity in Ohio, West Virginia and Pennsylvania.

Phase two will see this increased to 400,000 bpd when the pipeline will deliver mixed NGLs to new fractionation and storage facilities, providing connectivity to petrochemical facilities and product pipelines along the coasts of Louisiana and Texas.

In addition, the project includes the construction of a fractionation plant and NGL storage expansions in Louisiana. A new pipeline connecting these facilities to the converted Texas Gas line in the Eunice area will also be built.

Williams and Boardwalk are also reported to be looking into a new export liquefied petroleum gas terminal and related facilities on the Gulf Coast.

news in brief...

NGL Energy Partners acquires crude oil terminal NGL Energy Partners has acquired a crude oil terminal, Crescent Terminals in Delaware, US plus oil transportation company Cierra Marine and its affiliated companies.

The partnership says its purchase of the terminal facility will add 130,000 barrels of storage capacity in the developing Eagle Ford shale in southern Texas. It will also create a throughput capacity of up to 20,000 bpd for markets along the Gulf Coast.

The acquisition of Cierra Marine expands NGL’s crude oil logistics business through the addition of seven crude oil barges and four tow boats, doubling its existing fleet of marine equipment.

Sea-Invest and Glencore JV launch storage terminal Terminal operator Sea-Invest and commodities dealer Glencore have inaugurated a new tank storage terminal in Antwerp harbour.

The two companies signed a 51/49 joint venture agreement in 2010 to build the €250 million facility. Located on a 28 hectare site, the terminal now features 40 large storage tanks and a 100m long landing.

From the new terminal Glencore will export its petroleum products, including biofuels, kerosene and diesel, around the world either using one of Sea-Invest’s 28 coastal ships or on 150,000 tonne tankers.

Ergon Europe adds six new tanks Ergon Europe MEA has increased capacity at its Sea Tank Terminal in Antwerp, Belgium with the addition of six new storage tanks.

Capacity at the terminal has grown by more than 30% and it can now store 24,000m3. The number of tanks at the facility is 16. Ergon said in a statement that the new infrastructure came online in January and will be used for the company’s base, process and insulating oils.

Per Klintstam, president of Ergon Europe, says: ‘Increasing our storage capacity is part of our long-term vision of growth. It affords us the opportunity to fulfil a growing demand in the region for Ergon’s base, process and insulting oil products.’

July/August 2013 • TANK STORAGE

terminal news

KALDAIR

TANK STORAGE • July/August 2013

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terminal news

Enterprise develops export facilities in Texas Gulf Enterprise Products Partners is developing two export terminals for refined products that will help meet the growing demand for additional refined products export capability on the US Gulf Coast.

The company aims to provide customers with improved access to its marine facilities in Texas and on the Houston Ship Channel by utilising its existing Southern Complex of refined products

pipeline, storage and terminal facilities in southeast Texas.

Export services at the Beaumont marine terminal will initially handle Panamax size vessels and is expected to begin service in the first quarter of 2014, followed in mid-2014 by its expanded marine terminal in the Houston Ship Channel, which will be initially sized to handle up to Aframax class vessels.

Originally used as a ‘feeder

system’ for the Enterprise TE Products Pipeline system, the company has repurposed its Southern Complex over the past year in order to increase supply and market access, system flexibility and capacity.

‘This expansion is driven by the growth of US crude oil production from the development of the shale plays coupled with an increase in Gulf Coast refining production and

strong international demand for US refined products,’ says Michael Cree, CEO of Enterprise’s general partner.

‘In five years the US has transitioned from importing approximately 1 million barrels per day of refined products in 2007 to exporting over 1 million barrels in 2012, with most of these exports supplied by refineries in the Gulf Coast.’

Plains All American to expand Western Oklahoma pipeline Plains All American Pipeline (PAAP) is expanding its Oklahoma crude oil pipeline system by 95 miles.

The extension of the existing pipeline will serve increasing production from the Granite Wash, Hogshooter and Cleveland Sands producing areas in western

Oklahoma and the Texas panhandle.

The new infrastructure will provide up to 75,000 bpd of new takeaway capacity from Reydon, Oklahoma in Roger Mills County to PAAP’s existing Orion station in the state’s Major County.

When it reaches the Orion

station, crude oil will be transported via PAAP’s existing pipeline system to its terminal in Cushing.

The new Western Oklahoma pipeline is expected to be operational by the second quarter of next year. It is supported by long-term producer commitments.

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July/August 2013 • TANK STORAGE

terminal news

news in brief...

Kinder Morgan to extend Eagle Ford pipeline Pipeline transportation and energy storage company Kinder Morgan Energy Partners will expand its crude and condensate pipeline system with an investment of around $107 million (€81.8 million).

The expansion, supported by a longterm contract with ConocoPhillips, will extend the 178 mile pipeline by 31 miles from DeWitt County, Texas to ConocoPhillips’ central delivery facility in Karnes County. Kinder Morgan will also build receipt tanks and a truck unloading facility close to ConocoPhillips’ facility.

Construction will begin soon.

Kuwait Petroleum receives go-ahead for Vietnam refinery State-owned Kuwait Petroleum (KPC) is to break ground on a refinery and petrochemical facility in Vietnam after receiving approval from its board in May. The refinery will produce 200,000 bpd and the engineering, procurement and construction contract for the project has already been signed.

Kuwait Petroleum’s subsidiary Kuwait Petroleum International will hold a 35% share in the complex.

Gateway Terminals receives Canadian crude Gateway Terminals, a subsidiary of Seacor Holdings, is now able to receive Canadian crude oil (heavy sour-unconventional) following an upgrade to its terminal mechanics.

The terminal, located on the Mississippi River in Illinois, can now handle Canadian crude oil and Bakken crude and allows customers to ‘move unit trains or manifest volumes of North American crude oil from rail to barge on the Mississippi River’, Gateway says.

The facility also has capacity for new volumes of deliveries to Gulf Coast markets.

Shoreside soon to start on terminal expansion Alaska-based fuel and lubricant distributor Shoreside Petroleum will begin expanding its fuel storage terminal in Seward later this year.

The project is to be completed in stages, with phase one commencing in the summer. The extension will see an additional 8 million gallons of storage built at the site, raising the terminal’s total capacity to around 10 million gallons.

New storage at the terminal will guarantee supply all year round as harsh winter months can result in supply to the facility being cut from Cook Inlet due to severe ice.

Shoreside is partnering with Petro Marine Services for the expansion.

TANK STORAGE • July/August 2013

Singapore Oil to invest heavily in oil storage facilities Hin Leong, an oil trading and shipping company based in Singapore, plans to invest $3 billion (€2.3 billion) building new oil terminals and distribution facilities in Asia.

Around $2.7 billion will be used to develop storage and terminal facilities in China and East Timor.

An additional $300-400 million will be used to construct more projects in Indonesia and Myanmar.

Hin Leong’s chairman O.K Lim was quoted as saying: ‘East Timor, China, Indonesia and Myanmar all need oil for their development. We want to provide more services.’

The company already owns one of Asia’s largest commercial oil storage complexes, Universal Terminal, as well as a fleet comprising more than 100 tankers.

In East Timor, a terminal with

initial storage capacity of 100,000m3 will be built to handle jet fuel, kerosene, petrol and asphalt.

In Myanmar, the company plans to invest $100-200 million developing storage and distribution assets near Yangon, which will sell products directly to end users. ‘A lot of businesses are entering Myanmar after it opened its doors, so its oil demand is rising very fast,’ Lim said.

The company has identified two locations in Indonesia which could be the home of new oil storage and distribution facilities as demand there continues to rise.

And in China, Hin Leong has submitted plans for a new terminal at Meizhou Bay. If approved, the facility will cost $1.7 billion to construct and could eventually store up to 41 million barrels of crude oil.

MOL Romania completes phase I of Giurgiu terminal MOL Romania has finished building the first phase of its new terminal in the Free Zone in Giurgiu and inaugurated it at the end of May. The second stage of the construction project will see all tanks completed. Total storage capacity will be 7,000m3.

The terminal is built on a 15,000m2 site. Its storage facilities have direct access to river

transportation, helping to meet demand for diesel fuel and storage.

The fuels will be stored in aboveground reservoirs which are fitted with automated volume and temperature measurement technology, fixed fire-extinction systems and vapour recovery units. The tanks will have double walls or placed in leak proof concrete over-flow basins.

Genesis to build new unit train in US Midstream energy company Genesis Energy is expanding its existing rail terminal in Mississippi and will also build a new unit loading facility in the Powder River Basin off the Niobrara Shale Play, Wyoming.

At the Mississippi terminal, Genesis is finalising the first phase, which includes 40 railcar spots due for completion this summer, and is moving forward with a phase two expansion. Under this stage of the project the company will add a further 60 railcar spots

and new heated tanks to be fully operational later this year.

And in Wyoming, Genesis has broken ground on its new unit loading terminal, Pronghorn rail facility, after receiving all necessary permits in early April. It is expected to come online later this year.

These two projects will cost Genesis $75 million (€58 million), which the company intends to finance with funds available under its committed revolving credit facility.

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terminal news

Horizon’s Fujairah oil terminal ready for start-up Horizon Terminals, a wholly owned subsidiary of Emirates National Oil Company (ENOC), says its new oil storage terminal in the emirate of Fujairah will soon be commissioned.

The terminal, Horizon’s tenth, and second such facility to be located in Fujairah, cost over $100 million (€77 million) to build The oil terminal in Fujairah will be commissioned shortly and has a storage capacity of 240,000m3.

The facility took 22 months to build berths at the Port of Fujairah for efficient and was constructed by Singaporeimport and output of liquid oil products. based EPC contractor Audex.

Saeed Khoory, ENOC CEO, says: The terminal will be able ‘The new oil terminal in Fujairah is of to store bulk liquid oil products strategic importance to the energy such as fuel oil, naphtha, petrol, sector of the region, and in further gasoil, jet fuel and LPG. establishing the emirate as a key It is directly connected to oil tanker regional hub in the oil and gas trade.’

Enbridge enters agreement to expand Cheecham Terminal Pipeline operator Enbridge is to invest $300 million (€230.8 million) in the expansion of its Cheecham Terminal in Alberta, Canada.

The company has entered into a terminal services agreement with ConocoPhillips Canada Resources and Total E&P Canada (the ConocoPhillips Surmont partnership) for the project, which will be completed in two phases and is expected to enter service by the beginning of 2015.

The additional infrastructure at Cheecham will accommodate incremental bitumen production from Surmont’s phase two expansion.

Enbridge will build two new 450,000 barrel blend tanks and convert an existing tank from blend to diluent service, install receipt and distribution manifolds to facilitate transfers to Enbridge’s Waupisoo pipeline and upgrade associated measurement equipment.

The Waupisoo pipeline was expanded in 2012 to, in part, serve the requirements of growing production from the Surmont oil sands project.

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t. +44 (0)1843 221521 July/August 2013 • TANK STORAGE

terminal news

Mashreq inks deal for Egyptian tank terminal Mashreq Petroleum is to build Egypt’s first independent tank terminal after signing a 25-year concession agreement with the East Port Said Port Authority.

Mashreq is the core platform company of Citadel Capital, a major investment company in Africa and the Middle East. It was established in 2004 to build and operate the first tank terminal and logistics hub of its kind in the region.

The EGP3 billion (€333 million) facility will have a capacity for up to 800,000 tonnes

of product, including liquid bulk and bunker fuels. Mashreq will have an annual storage capacity of 10 million tonnes per year and an annual bunkering capacity of 2 to 3 million tonnes with three berths that will accommodate tankers up to 120,000 DWT and four berths for bunkering barges. The project will be completed in several phases.

Chairman and MD of Mashreq, Tamer Abubakr says: ‘Coming on the heels of cabinet-level approval for the project, the concession agreement between Mashreq and the Port Said Port Authority clears the way for the fast-tracking of this critical project, which stands as a backup to Egypt’s national energy security.’

The terminal will primarily serve the bulk liquid market in the Far East, the Middle East and the broader Mediterranean regions and will be connected to the national petroleum pipeline grid 17km south of the project.

Mashreq has been granted all the necessary regulatory and governmental The nation’s first independent terminal will be approvals and has also completed built in phases the design of its tank farm.

IOC to lease Ennore Port land for LNG terminal State-owned Indian Oil (IOC) is to build its LNG terminal at Ennore Port after the Union Cabinet agreed to lease land there.

IOC plans to build the 5 million tonne per year LNG import terminal, at a cost of Rs4,320 crore, by 2016. There will be potential for its capacity to be expanded to 1015 million tonnes in the future.

IOC will hold the majority stake in the terminal, with Tamil Nadu Industrial Development reported to take a 5-10% share.

‘The Union Cabinet has given its approval for leasing of land measuring 520,000m2 of Ennore Port to the joint venture led by IOC for 30 years for setting of up LNG storage and regasification terminal project at Ennore Port,’ information and broadcasting minister Manish Tiwari was reported to have said.

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www.emcowheaton.com TANK STORAGE • July/August 2013

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terminal news

Boryeong LNG Terminal continues with LNG project

EIA releases report on bulk liquid storage capacity in the US Around 1,476,510 (thousand barrels) of bulk liquid storage capacity is currently operational in the US, according to the Energy Information Administration’s (EIA) report Working and Net Available Shell Storage Capacity as of 31 March 2013.

Boryeong LNG Terminal is developing a facility in Boryeong in South Korea’s South Chungcheong province.

The terminal will comprise three 52.8 million gallon LNG storage tanks, a 45,000 tonne LPG tank and a regasification plant.

Boryeong LNG Terminal has awarded a KRW411 billion (€285 million) contract to GS Engineering and Construction to build the LNG terminal and the two companies held a contract signing ceremony in May. The total cost of the project will be KRW759 billion; SK Engineering & Construction has also been awarded a contract for KRW348 billion.

Construction is estimated to last 42 months until September 2016.

Net available Shell storage capacity of terminals and tank farms aof March 31 21031

Wolverine plans $30m crude oil terminal Wolverine Terminals is to build a crude oil terminal and blending facility in St. James Parish in Louisiana, US. The $30 million (€23.3 million) terminal will be developed on 15 acres of land along the Mississippi river, strategically located for the receipt Canadian and US crude oil shipments via rail and blended products via barge.

Wolverine says it will break ground on the terminal later this year and expects to complete the project in 2014. It will be able to store 425,000 barrels of crude oil in five storage and blending tanks.

The project is supported by energy investment companies Gulfport Energy of Oklahoma City and Wexford Capital of Greenwich, Connecticut.

Noord Natie Odfjell Terminals will reach a storage capacity of 350,000m³ by the end of 2013 In 2009 the first expansion in stainless steel tanks started and was finalised in two phases in 2011 adding 30,000m³ of stainless capacity.

The construction continued with an additional eight tanks totalling 32,000m³ in mild steel tanks. This year the next phase of 50,000m³ additional capacity started and will be completed by the end of the year.

14

Meanwhile, the basic engineering has started for an expansion on a piece of land adjacent to the existing terminal for another 100,000m³. This will add a further 500m³ of quay length and two new loading positions for vessels up to 75,000 dwt. This will bring the total waterfront to more than 2km.

An agreement with the Antwerp

Port Authority has been reached on quay wall adaptations and dredging to reach a draft of 14m alongside.

A second entrance will be added to allow smooth transit of the growing number of trucks when the new capacity is ready and the additional loading stations are operational.Railcar/block train loading is also part of the expansion plan.

July/August 2013 • TANK STORAGE

terminal news

Maasvlakte 2 officially opens Maasvlakte 2, the expansion of the Port of Rotterdam in the Netherlands, has been officially opened by Melanie Schultz van Haegen, minister of infrastructure and the environment.

At the opening ceremony, CEO of the Port of Rotterdam Authority Hans Smits said: ‘Together we have succeeded in constructing this phase of Maasvlakte 2 according to schedule and inside budget. The project has turned out approximately €150 million less expensive than estimated.’

A fleet of around 25 vessels became the first to sail via Tangtzekanaal to Maasvlakte 2 on 22 May. Smits added: ‘Maasvlakte 2 is an integral part of the port area. It is now accessible by road, rail and water.’

Later this year the Port Authority will continue with the development of an industrial park for the (bio-based) chemical industry on the site next to Lyondell Bayer. It will also make ship-to-ship transfer a reality at Maasvlakte.

The original cost of the project’s first phase was estimated at €1.9 billion, but it came in at €1.55 billion.

Maasvlakte 2 opening ceremony

Kinder Morgan to invest over $100m in new infrastructure Pipeline transportation and energy storage company Kinder Morgan Energy Partners has announced a $106 million (€82.3 million) investment to expand its Galena Park terminal,

located in Pasadena, Texas.

The expansion project will include construction of nine new storage tanks with a capacity of 1.2 million barrels.

The investment also includes construction of

a new barge dock that will help reduce barge congestion in the Houston Ship Channel and the acquisition of 20 acres of land adjacent to the terminal.

Kinder Morgan says the

additional acreage ‘will be used to support a future crude condensate and refined products terminal capable of handling ten 150,000 barrel tanks with a connection to the Explorer Pipeline’.

www.baltictank.fi TANK STORAGE • July/August 2013

15

terminal news

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July/August 2013 • TANK STORAGE

terminal news

Imperial Oil to convert Dartmouth refinery into terminal Imperial Oil will convert its Dartmouth, Nova Scotia-based refinery into a terminal after failing to attract a buyer.

The company received interest in the facility’s assets over the past 12 months but was unable to sell it in the end. Additionally, Imperial’s chairman and CEO Rich Kruger says operating a large-scale refinery in the region is challenging given the competitive market of the Atlantic Basin.

‘The results of the marketing effort illustrate the challenges of operating a refinery of Dartmouth’s scale in the competitive

Imperial Oil’s Nova Scotia refinery will be turned into a terminal conditions of the Atlantic Basin market,’ Kruger explains.

The new terminal could

Enterprise forms JV for NGL fractionation trains Enterprise Products Partners has entered into a joint venture with Western Gas Partners to own two natural gas liquid (NGL) fractionation trains currently being built at Enterprise’s complex in Texas, US. Western Gas has acquired a 25% minority stake in the JV, while Enterprise owns the remaining 75% interest.

Trains 7 and 8, expected to begin commercial operations by the end of this year, have a design capacity to fractionate approximately 170,000 bpd of NGLs. ‘This is the third midstream energy infrastructure project in which we have partnered with Anadarko Petroleum and its affiliates,’ explains Michael Creel, CEO of Enterprise’s general partner. ‘Anadarko is a strategic partner that has made significant volume dedications to our facilities, including NGLs to our fractionation complex in Mont Belvieu.’

TANK STORAGE • July/August 2013

come online later this year, depending on progress with facility modifications

in the coming months.

The refinery, which opened in 1918, has a throughput capacity of approximately 88,000 bpd, producing a number of petroleum products including petrol, diesel, jet fuel, heavy fuel oil and asphalt. Around 200 employees and a further 200 contractors work at the refinery and related terminals.

‘Our focus in the nearterm will be on continued safe and environmentally sound operations while making facility modifications that will support ongoing supply of competitively priced petroleum products to the market,’ adds Kruger.

Q8 to start building petrochemical facility next month Kuwait Petroleum International (Q8) will break ground on its refinery and petrochemical complex in Vietnam this summer, the company’s MD Bakheet Al-Rashidi has revealed.

Construction is scheduled for completion by the end of 2016 before the facility comes online in the second quarter of 2017.

The $9 billion (€6.7 billion) Nghi Son refinery and petrochemical complex, to be built in the northern province of Thanh Hoa, is a joint

venture between Q8, PetroVietnam, Idemitsu Kosan and Mitsui Chemicals.

In addition to the petrochemical complex, the project also includes new storage infrastructure and pipelines. It will handle products such as petrol, diesel and jet fuel for sale to the local market.

The crude for the refinery will be supplied by Q8’s parent company, Kuwait Petroleum.

It will be able to refine up to 200,000 bpd of crude oil.

Tesoro acquires BP Southern California refining and marketing business Independent refinery Tesoro has acquired BP’s Southern California Refining and Marketing business after announcing the closure of the deal at the beginning of June.

The business includes the 266,000 bpd Carson refinery and over 800 dealer operated retail stations.

The purchase price for the assets was $1.075 billion (€822 million). Inventory at market value and other working capital totalled another $1.35 billion.

In similar news, Tesoro Logistics (TL) has closed the acquisition of the first portion of the Carson logistics assets for total consideration of $640 million. These assets include six marketing and storage

terminal facilities, with a total storage capacity of 6.4 million barrels and around 225 million bpd throughput capacity.

The transaction price included $544 million in cash and TL equity valued at $96 million.

The remaining Carson logistics assets, made up of dedicated storage capacity, pipelines and marine terminals, are expected to be offered to TL within 12 months and have an expected market value of between $450 and $550 million.

Last year the total average throughput at these terminal facilities was 147,000 bpd but TL hopes to grow this by an additional 25,000-30,000 bpd within one year of the transaction closing.

17

terminal news

Brightoil progresses with oil storage facilities in China

Oiltanking to build Indonesian terminal

Brightoil Petroleum is developing oil storage terminals on Waidiao Island in Zhoushan, China and its wholly owned subsidiary, Brightoil Petroleum Storage, has signed a construction contract with China Petroleum Pipeline Bureau to build the phase one of the project.

The project will have a total storage capacity of approximately 3.2 million m3. It will be built in

Independent tank storage provider Oiltanking, together with its joint venture partner Gunvor Group, is to build an oil storage terminal on the Indonesian island of Karimun.

The green field facility will have an initial storage capacity of 760,000m3 which, Oiltanking says, is needed ‘to meet the incremental storage needs of the Singapore trading area’.

Oiltanking will manage and operate the terminal while Gunvor, with a minority equity stake, will rent a portion of the capacity.

The terminal, which will be able to handle both clean petroleum products and black oil, is expected to come online in the second quarter of 2015. There is land on which the facility could be expanded in the future.

two stages, with the first having a capacity of 1.94 million m3 for fuel oil, petroleum, diesel, jet fuel and chemical products. It is expected to come online during the second half of next year.

The second phase of the project, which will have a capacity of approximately 1.22 million m3, is slated to begin full commercial operations in the second half of 2015.

Under the construction contract, China Petroleum Pipeline Bureau will carry out the construction works for the oil storage facilities to be erected in the initial stage. The contract is worth RMB1.32 billion (€161.5 million).

Sit Kwong Lam, chairman and CEO of Brightoil Petroleum, says: ‘Zhoushan is emerging as a major petrochemical and trading hub for east China and is strategically located to support the import and regional trade for the greater Yangtze River Delta region.

‘It creates synergies with our project on Changxing Island in Dalian, an oil storage and facilities project under development.

The commissioning of these two projects will bring us stable revenue from oil storage as well as oil trading opportunities.’

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Vopak eyes Asia for LNG terminal Rotterdam-headquartered independent tank storage provider Vopak is looking to develop more LNG terminals to meet rising demand.

With LNG supply expected to grow, so is the demand for storage. With this in mind, Vopak is said to be considering building a facility in Asia. The company already owns two LNG terminals, one in Europe and another in Mexico.

‘A lot of countries are developing LNG terminals for import so there is the possibility to see more LNG being traded,’ Eelco Hoekstra, Vopak CEO was quoted as saying.

He has not revealed any specific locations at this stage.

CNP building tanks at Burma terminal Six new storage tanks are nearing completion at China National Petroleum’s (CNP) oil terminal in Burma.

Six 100,00m3 tanks have already been completed, with the additional infrastructure due in two months’ time. Huanqui Contracting and Engineering is building the tanks.

The facility will also feature two pipelines: a crude oil pipeline that will transport 440,000 bpd when it comes online in 2014, and a 12 billion m3 natural gas pipeline due to start up later this year.

The terminal is being built on a 10km2 island off Burma and will supply oil and gas to Yunnan province in China. It will have a total storage capacity of 1.2 million m3.

July/August 2013 • TANK STORAGE

terminal news

Crude oil terminal planned for Wyoming Midstream services provider Meritage Midstream Services II and coal producer Arch Coal are to create a joint venture company named Black Thunder Terminal.

Black Thunder Terminal will provide producers in Wyoming’s Powder River Basin and downstream refiners with a rail terminal for crude oil handling, storage, rail loading and marketing services. The two companies have executed a letter of intent to form the JV. The facility will be built at Arch Coal’s existing Black Thunder mining complex in Wyoming. The company will contribute reclaimed land, rail switching, loop and other existing infrastructure assets to the JV. Meritage will provide capital and build and operate the crude oil terminal. It will

The Black Thunder Terminal will be built in Wyoming also own a majority stake in Black Thunder Terminal.

Operations, including crude oil transloading, could commence at the terminal

by September as much of the required rail infrastructure is already in place.

The terminal will have an initial shipping capacity of

The principle of water removal

10,000 bpd of crude oil. As demand increases, however, this could be ramped up to 120,000 bpd. It will be served by BNSF Railway.

‘The Power River Basin has been the largest coalproducing region in the country for many years and currently accounts for

approximately 40% of US coal production,’ says Meritage Midstream chairman and CEO Steve Huckaby.

‘Now new drilling technologies are being applied to legacy oil fields in the Basin, allowing operators to expand their drilling programmes.

Approximately 25 rigs are operating in the region; more than 430 horizontal drilling permits were issued in the Powder River Basin in 2012, and 222 have been issued thus far in 2013. What the Basin lacks is sufficient pipeline and rail infrastructure at the right locations to move crude oil and condensate to the highest value markets.’

The proposed JV is subject to customary approvals, which the companies expect to receive within six months.

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TANK STORAGE • July/August 2013

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terminal news

BOSTCO terminal to undergo $54m expansion The Battleground Oil Speciality Terminal Company (BOSTCO), currently under construction on the Houston Ship Channel, is to be expanded by 900,000 barrels.

BOSTCO is a joint venture between Kinder Morgan Energy Partners and TransMontaigne Partners. Kinder Morgan owns a 55% interest in the venture and will operate the facility.

The expansion, expected to cost around $54 million (€41 million) includes the construction of six 150,000 barrel ultra-low sulphur diesel tanks, additional pipeline and deepwater vessel dock access, and high speed loading at a rate of 30,000 barrels per hour.

Work on the expansion project started in the second quarter of 2013, with commercial operations expected to begin by the end of next year.

The terminal will comprise 57 storage tanks The $485 million BOSTCO oil terminal is slated to begin commercial operations in the third quarter of this year.

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July/August 2013 • TANK STORAGE

terminal news

Avedia receives first tanks for LPG terminal Oil and gas company Avedia Energy has received four LPG storage tanks that will be installed at its new import terminal at the Port of Saldanha in Cape Town, South Africa.

The tanks will make up part of the company’s R300 million (€22.8 million) LPG import terminal and handling facility. Construction is due to begin this summer and, when it comes online by Q4 2013, the facility will be able to store 8,000 tonnes of product.

The initial four storage tanks, totalling 4,000 tonnes of storage capacity, have arrived at the port after they were shipped from the manufacturing plant in China six weeks ago.

‘The current LPG shortfall and the erratic production of LPG in South Africa is exacerbated by the country’s handicapped LPG storage and transport infrastructure, which means that South Africans are simply not able to consider LPG has a reliable and cost-effective energy alternative,’ Avedia MD Atose Aguele was reported to have said.

Four LPG tanks have been delivered to South Africa’s new import terminal

Odfjell to add mural to North Charleston terminal Odfjell Terminals is looking to brighten up its storage facility in South Carolina with a large mural on one of the oil tanks.

The Odfjell Terminals Charleston is a bulk liquid marine terminal which handles chemical,

vegetable and petroleum products.

The city is said to be seeking professional graphic artists to complete the $5,000 (€3,800) project which, the North Charleston Cultural Arts Department was

Louisiana oil terminal nears completion The Gulf Gateway Terminal, a joint venture between Murex and Bulk Resources located at the Port of New Orleans in Louisiana, will soon begin operations.

The $30 million (€23.3 million) facility will receive crude oil shipments from the US and Canada for transportation to refineries. It will be able to transfer up to 100,000 barrels per hour of crude straight onto barges or store the oil in the terminal’s 103,000 barrel tank.

The terminal is located for access to the Mississippi River and the Gulf of Mexico.

It also has rail access to six railroads.

Development of the terminal got underway two years ago and received its first shipment of crude oil in June.

‘So much oil is being produced here, but obviously the production areas do not have the pipeline structure to take the oil away,’ Murex president Robert Wright was reported to have said. ‘Our plan is to bring unit trains of crude oil down to New Orleans and then put them straight on the Mississippi River on barges to go out to the refining community.’

A new 120,000 barrel storage tank is planned for the terminal later this year.

quoted as saying, should ‘create excitement and interest for the community, honour the history of the community, complement the redevelopment initiatives of the community and be appropriate to the location’.

The chosen artist(s) will design the 140ft x 40ft mural, which will be placed on one of the white tanks, and will include Odfjell’s logo.

Applications were closing when Tank Storage magazine went to press.

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07/01/2013 14:54

terminal news

Landmark celebration for Vopak Terminals in Asia Vopak Terminals Singapore hit a landmark anniversary this June as it celebrated 30 years of operation.

Vopak’s first terminal, Sebarok, was commissioned in 1983 under the guidance of Carel van den Driest, and it was the first thirdparty oil storage facility in Singapore at the time.

To date, the company now owns and operates four terminals with a total capacity of over 3 million m3 across western Singapore.

Eelco Hoekstra,

CEO of Vopak, said during a speech given at a gathering to mark the achievement that the company and the country had formed ‘a pearl of a partnership’.

‘We are optimistic that Vopak Terminals Singapore will continue to serve as a model and the nucleus for our future growth in the Asia region. To do that, we will continue to strive towards excellence and seek growth opportunities,’ he added.

Vopak marks three decades of operations in Singapore

Par Petroleum to purchase Hawaii-based fuel refinery San Antonio-based refiner Tesoro has found a buyer for its Hawaii refinery in the shape of Par Petroleum.

Houston-based Par will shell out $75 million (€56 million), plus working capital of between $225 million and $275 million, for the 94,000 bpd refinery in Kapolei. The deal includes all retail stores and associated logistics.

Tesoro revealed earlier this year that it would convert the refinery to a storage and distribution terminal if a buyer could not be found, with employee layoffs due to begin in June.

Par says the deal, expected to close in the third quarter, would be majority financed by issuing $200 million in common stock, plus the retail gas stations will remain under the Tesoro brand.

Brian Schatz, a Democratic US senator, was quoted as saying the operation is a critical part of Hawaii’s economy and the purchase will ‘help with the availability of jet fuel, diesel fuel and other refined products’.

22

July/August 2013 • TANK STORAGE

technical news

New hose continuity tester from Newson Gale Newson Gale has developed a continuity tester to ensure hoses have electrical continuity with a grounded truck, reducing the accumulation of electrostatic charges in metal hose components.

During hazardous area tank cleaning, spill recovery and product delivery vacuum trucks and bulk road tanker trucks are regularly exposed to the ignition hazards of static electricity.

It is important to ensure that hoses used to transfer product into, or out of, the vehicle cannot accumulate static electricity. Electrically isolated metal components, like hose couplings and wire helixes, have the potential to accumulate enough static electricity to discharge a high energy spark into a combustible atmosphere.

The OhmGuard Hose Continuity Tester operates on the principal of a ‘Pass’ or ‘Fail’ test procedure.

To operate the device,

the driver first grounds the truck and then assembles the required number of hose sections to the truck.

The driver will then connect the OhmGuard clamp to the free coupling or nozzle of the last hose.

If the electrical resistance through the string of hoses to the grounded truck is ‘good’, a green LED mounted in the OhmGuard clamp will pulse continuously informing the driver that the hoses are bonded to the truck and are safe to use. If there is a break in continuity, the LED will not pulse and the driver may carry out a quick visual inspection of the hoses to ensure parts, like wire helixes, have not suffered broken connections with components like end couplings.

The OhmGuard carries cCSAus, ATEX and IECEx approvals for operation in the highest combustible gas, vapour and dust atmospheres.

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Storage tank builder Fenelon acquired Fenelon Storage Tanks has been acquired for £10 million (€11.5 million) by Manchester, UK-based entrepreneur Johnny Patoff.

Fenelon was founded in 2004 and works in storage tank design, manufacture, construction and maintenance for the oil and gas sectors.

It has sites in Lincolnshire, and Longford in Ireland, as well as its headquarters in Northumberland.

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TANK STORAGE • July/August 2013

23 275 x 90 E.indd 1

16/01/13 10:38

technical news

Wilks launches new portable IR analyser Wilks has developed a new IR analyser that can accurately measure down to 0.1 ppm oil in water, onsite and in less than 15 minutes.

The new InfraCal 2 Field Portable IR Analyzer is the newest addition to Wilks’ line of oil in water/soil analysers and provides added sensitivity and features for challenging environmental applications.

The InfraCal 2 IR Analyzers combine improved electronics which increase signalto-noise ratio for greater performance with a touch screen intuitive display that allows for new options and features – including multiple calibrations, internal data logging and data transfer capabilities, alarm functions to ensure results are acceptable, and security settings to avoid

unauthorised changes. The result is a compact package, weighing less than 6lbs. It has no moving parts and low maintenance qualities.

The new analyser provides improved sensitivity and detection limits for a variety of on-site oil in water measurements, such as sub-ppm detection levels of oil in wastewater going into inland waterways, off-shore produced water discharges, and cleaning efficiency of metal parts. Models are available for use with infrared transparent solvents, as well as hexane, for the extraction process. While designed for field applications, InfraCal 2 can also be used at the analytical laboratory.

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Wilks’ new InfraCal 2 repetitive measurements from the lab to the actual analysis site where they can be routinely handled by non-technical personnel.

Onsite measurements using

the InfraCal 2 Analyzer take less than 15 minutes and eliminate the wait for off-site lab results which can take hours or days to receive.

Benko’s safety gate fits into tight spaces Benko Products, a material handling and products company, says its new safety gate features a novel design that requires only 10” of floor space when closed at the mezzanine ledge.

The Protect-O-Gate Clear Aisle mezzanine safety Gate features a double gate and three-sided load access to ensure fall protection in tight spaces without sacrificing productivity.

It reduces the potential for falls and other accidents associated with mezzanines and loading areas.

These OSHA-compliant safety gates are counterbalanced for ergonomic manual operation.

Optional powered operation includes remote controls and safety features. These units can be customised to accommodate various load and space restrictions.

Shipped partially assembled, standard single- and double-pallet models are painted safety-yellow and are also available in either a corrosionresistant finish or stainless steel.

July/August 2013 • TANK STORAGE

technical news

Mouvex upgrades A Series pump line Mouvex, a manufacturer of positive displacement pumps, vane compressors, screw compressors and hydraulic coolers, has upgraded its A Series eccentric disc pumps.

Mouvex has incorporated a variety of upgrades to the pumps to meet growing global demand, including the implementation of ISO PN16/ANSI 150 flanges. The maximum differential pressure has also been doubled from 5bar to 10bar, enabling it to be used in the safe transfer of viscous, non-lubricating, volatile or delicate fluids in a variety of new applications.

The Mouvex A Series, previously available in cast iron, is now also made of ductile iron – a key upgrade as more companies in the petrochemical industry, for

example, are integrating ductile iron systems into their processes.

The enhanced series also features mechanical seals, which help expedite installations regardless of location. The mechanical seal is positioned behind the piston and provides efficient shaft sealing.

Mouvex A Series pumps enable product transfer up to 250°C. They have maximum speeds to 750 rpm, maximum flow rates to 55 m3/h, as well as suction and discharge ports from 1” through 4” in size.

They are positive displacement pumps which utilise eccentric disc technology, enabling self-priming and rundry capabilities while

The upgraded A Series eccentric disc pump is now available in ductile iron maintaining constant flow rate regardless of changes in viscosity and pressure.

The pumps also maintain their initial performance

over time and are ATEXcertified for use in potentially dangerous environments with the ability to run-dry for up to three minutes.

Auma secures KazTransOil contract KazTransOil, the dominant oil transporter for Kazakhstan, has selected Auma’s modular electric actuators for valve automation at an oil metering skid incorporated into the Almaty terminal.

Responsible for 80% of all oil distributed in Kazakhstan, KazTransOil operates a pipeline network totalling over 6,000km.

Located in the Caspian Sea, the new oil terminal meets demand for increased oil volumes produced at onshore and offshore fields.

Auma was selected to supply actuation combinations, including gearboxes, in explosion proof variants. Ball valves for the project were supplied by Virgo.

A key reason cited for choosing Auma was its proven expertise in modular actuation solutions. Separate housing for electrical connections using plug and play technology was seen as an important design feature as wiring is not disturbed, even if an actuator is removed from a valve.

For your storage needs in Europe!

Storage of Chemicals and Petroleum products.

Contact us!

Telephone: +46-31 53 45 00 Fax: +46-31 53 45 08 Email: info@nordicstorage.se

Auma representatives review actuation products prior to shipment at Virgo Middle East’s assembly centre in Dubai

TANK STORAGE • July/August 2013

25

technical news

Honeywell expands software portfolio Honeywell has developed several new services and technologies to help plant workers redefine how they maintain system uptime and reliability.

The company has introduced the Assurance 360, an approach to service management that offers flexible programming to assure continued performance of Honeywell control systems. The programme provides support throughout the plant’s lifecycle in addition to expert resources to guarantee performance outcomes.

Additionally, the company has expanded its portfolio of Operations Excellence solutions, including new alarm management and

26

performance monitoring software. Honeywell has also expanded its widely used Benefits Guardianship service programme to include a variety of engineering-led services.

In similar news, Honeywell has introduced its Fusion4 MSC-A, a controller that helps ensure efficient and safe operations for petrochemical handling.

The Fusion4 can be supplied as a standalone device or coupled with additive injection hardware for a complete solution. It integrates with industry standard terminal automation systems and load computers and avoids the need for expensive alterations to existing equipment and infrastructure.

Honeywell’s Fusion4 for use with petrochemical handling

July/August 2013 • TANK STORAGE

technical news

Rotork valves enhance Texas terminal A wireless valve control from Rotork has been described as a ‘perfect fit’ for one petroleum tank farm automation project in the US.

In 2011, an operating division of Martin Midstream Partners (MMP) started building a product tank farm at the Port of Corpus Christi, Texas, comprising 100,000 barrel tanks and four booster pumps to serve nearby truck and ship loading terminals.

Originally, the facility was designed for a single hydrocarbon product.

The terminal’s original specifications did not require any automated valves to isolate the individual storage tanks.

During construction, MMP decided to upgrade and introduce the capability to handle a second product, which required isolating the tanks to avoid crosscontamination. To achieve this, MMP specified Rotork electric valve actuation Rotork IQ valve actuator installations on one of the under centralised control. storage tanks at the MMLP Corpus Christi tank farm The explosion proof 2_Tank_Storage_Jun_Jul:Layout 1 19.06.13 10:35 Page 1

Rotork IQ non-intrusive actuators are monitored and controlled by a Rotork Pakscan P3 digital system, designed specifically for valve actuation duties and the environments associated with hazardous area petrochemical plants and storage areas. The Rotork system incorporates all appropriate interlocks which safeguard the integrity of the terminal operations.

For this project, MMP has been able to take advantage of additional functionality and further economies through the introduction of Pakscan P3 with a wireless field network. Wireless Pakscan eliminates virtually all the costs associated with the installation of wiring, cable ducts, safety barriers and associated equipment required for network cabling, while enabling an increased level of information from the actuators to be communicated over the wireless network.

Following the success of this project, the same actuation and control system will be extended to three additional tanks to be built during the second phase of construction at this facility.

Bornemann pumps for tank storage, -terminals and refineries For the professional and economic storage and transport of mineral oil products

Our expertise for tank storage and -terminals and refineries • Loading and unloading of barges, tankers and trail trucks • Circulation from tank to tank • Stripping of tank and pipes • Transfer • Operation with wide range of product viscosity • Operation at high or low pressure TANK STORAGE • July/August 2013

• Full control in all kind of operation modes • Reduced installation costs for pipes and valves • High safety due to variable operation • Low pulsation • No fixed duty points • Wide range of capacity

Joh. Heinr. Bornemann GmbH P.O. Box 1162 31676 Obernkirchen, Germany Fon: +49 5724 390-0 Fax: +49 5724 390-290 info@bornemann.com www.bornemann.com

27

technical news

Green Access loading racks protect in extreme environments Equipment manufacturer Green Access and Fall Protection has announced its truck loading racks provide protection to operators in challenging environments.

The truck loading racks are designed for ease of installation, and are engineered in compliance with Occupational Health and Safety Administration standards.

The truck loading racks

feature single or multiple hatch access and can be equipped with several access options, including slide-tracks, as well as with or without canopies.

Other access options include self-levelling stair gangways, flat ramp or telescoping gangways and customdesigned safety cages.

Standard finish is red oxide primer. Optional coatings and hot-dipped galvanising are available.

Wilden launches AODD pumping technology

The truck loading racks come with optional features including hatch access and access options

Wilden, a supplier of air-operated double diaphragm (AODD) pump technology, has launched a new system for use in advanced bolted and original series clamped AODD pumps.

The patent-pending Pro-Flo Shift Air Distribution System (ADS) helps plants reduce both air consumption and carbon footprints.

It allows Wilden AODD pumps to achieve up to 60% savings in air consumption over other compeititve AODD pump technologies while providing more product yield per standard ft3 per minute.

The Wilden Pro-Flo Shift is available in 38, 51 and 76mm sizes and features maximum discharge pressures to 8.6bar, maximum flows to 243 gpm and maximum solid-handling size to 13mm. It is available with maximum suction lifts to 7.2m dry and 9.6m wet.

Wilden says the system improves energy efficiency and costs less than an electronically actuated ADSs. It is also submersible and features a plug-and-play operation. It is suitable for use in harsh operating environments and includes ATEX compliance for use in potentially explosive atmospheres.

Wilden’s AODD ADS reduces air consumption by 60%

28

July/August 2013 • TANK STORAGE

terminal news

Motherwell Bridge completes first tank at African terminal Engineering contractor Motherwell Bridge has finished building its first tank of the $22 million (€16.8 million) project to renovate and build 22 oil storage tanks in Liberia, West Africa.

Liberia Petroleum Refining’s (LPR) existing fuel storage terminal near the country’s capital at Monrovia has fallen behind international standards.

Since starting on site last year, Motherwell Bridge’s workforce has built a new fire water tank, which is complete pending acceptance by the client of its fire protection arrangements, and a further 60,000 barrel capacity gasoil tank is now almost complete and will soon be ready for testing.

Work has started on a 65,000 barrel capacity PMS fuel tank which will be complete in around 16 weeks, while a new jet fuel tank recently entered the construction phase.

All new tank works on the project will be mechanically completed during 2013,

although testing is likely to take place next year. Painting of all the tanks can only be done after testing and during Liberia’s dry season.

The team has also completed the shell of a new-build laboratory building and will soon begin its internal fit-out.

Motherwell Bridge has been contracted to modernise the boat offloading, pipeline and jetties at the site, carry out all civil engineering works and demolish a redundant plant on the site. The global contractor will also build new tanks and bunding while laying foundations and pipelines, installing new pumps and fitting electrical systems. New instrumentation will be developed during the project and fire fighting systems will be installed.

The whole project will take three years and the end result will see LPRC increase its fuel holding capacity on the site and potentially lead to further investment from the large oil and gas multinationals.

The first of 22 new storage tanks at Liberia Petroleum Refining’s terminal

Defining the limit as standard Safe, fast, explosion-proof AUMA offer a comprehensive range of actuator and gearbox types combined with suitable actuator controls backed by global approval and certification for use in potentially explosive atmospheres or areas subject to fire hazards.

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AUMA Riester GmbH & Co. KG P.O. Box 1362 • 79373 Muellheim, Germany Tel. +49 7631 809-0 • riester@auma.com

www.auma.com

TANK STORAGE • July/August 2013

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21.12.2012 10:14:10

terminal news

Delivering Peace of Mind to Terminal Operators Since 1988 TDS offers game changing data delivery and management tools UAP combines TDS and MultiLoad II, resulting in the most sophisticated automation platform for bulk plants TMS6 is the most widely used and trusted terminal management system in the world MultiLoad II is the most innovative preset on the market RCU II and veriFID offer powerful access control and facility security solutions

Scan This QR Code to Learn More about Toptech 1. Download a QR code reader such as “QRReader” on your smartphone or tablet 2. Scan the QR code on the right 3. Discover how Toptech Systems can change the way you do business USA OFFICE — LONGWOOD, FLORIDA PHONE: (407) 332-1774 — FAX: (407) 332-1802 EUROPE OFFICE — ZWIJNDRECHT (ANTWERP) BELGIUM PHONE: +32 (0)3 250 60 60 — FAX: +32 (0)3 250 60 61

www.toptech.com 30

uap.toptechdata.com July/August 2013 • TANK STORAGE

technical news

Expanded tank cleaning range Nozzle and spraying system company Bete has expanded its range of tank cleaning products following a number of modifications and improvements to its main tank cleaning ranges.

The company has made changes to three of its key product areas. The HydroWhirl-S range of rotary tank cleaners have four new standard models added for increased versatility.

These nozzles carry out cleaning-in-place, making them ideal for applications within the Bete has improved its offering pharmaceutical and chemical industries. of tank cleaning products The HydroWhirl Poseidon range of PTFE with additional models and rotary tank cleaners has a new lower flow rate components model along with other modifications. This results in a slower rotation speed for increased dwell time and effective cleaning power for more challenging tank cleaning situations.

And the Hydrowhirl Orbitor range of high power impingement cleaners now includes a new twin head, eight-nozzle variant for swift cleaning cycles as short as five minutes.

PSG acquires Ebsray Pumps Pump Solutions Group (PSG), a manufacturer of positive displacement pump and supporting technologies, has completed the acquisition of Ebsray Pumps, located in Brookvale, Australia. Ebsray, a supplier of pumps for a wide range of industrial applications, will become part of PSG’s Blackmer operation.

Ebsray’s pumps are ideal for LPG, chemical, general industrial and military markets. Its product lines include sliding vane pumps, regenerative turbine pumps and internal gear pumps, in addition to other pumps and products.

Ergil achieves ASME certifications Ergil, an engineering, construction and manufacturing company for the oil and gas, chemical and petrochemical industries, has attained ASME approval.

The approval certifies the company to manufacture, repair and modify products according to the American Society of Mechanical Engineers (ASME) ‘U’, ‘S’ and National Board ‘R’ standards after having its facilities, processes and system inspected onsite in Mersin, Turkey by authorised ASME inspectors.

The U stamp is for manufacture of pressure vessels, the National Board R stamp is for the repair and/or alteration of boilers, pressure vessels and other pressure-retaining items, and the S stamp covers the power boilers under the ASME Boiler and Pressure Vessel Code.

ASME inspections ensure that Ergil follows regulations including quality control systems, procurement, design, manufacturing processes, investments and personnel know-how in accordance with the ASME code.

Oktay Altunergil, CEO of Ergil comments: ‘Earning the ASME and National Board

certificates means Ergil has proven all of its procedures from the time an order is placed until shipment is certified by authorised independent third party inspection for compliance with the applicable ASME and National Board standards.’

ASME is a US organisation that creates and maintains the

TANK STORAGE • July/August 2013

standards by which pressure vessels, tanks and piping manufacturing is realised worldwide. The standards detail the welding procedures, design requirements, quality control and acceptance criteria for products used in the oil and gas industry. These standards are required by law in certain

countries including the US and are sought after by clients in the rest of the world as proof of quality and safe operation.

National Board, another American organisation, is tasked with standardising and certifying companies for the repair and modification of ASME certified products.

Q: What can SAS do for you?

A: Reduce your tank cleaning time by 50%

Watch the new webinar: YouTube.com/SurfaceActive

www.surfaceactive.com

31

technical news

PPE launches advanced sealing solution for oil and gas industry Precision Polymer Engineering (PPE), a manufacturer of elastomer seals, has expanded its range of sealing solutions for the oil and gas sectors.

The new range of spring seals includes elastomer seals which are made from Perlast and Endura materials and incorporate a spring, making them suitable for applications encountering high pressures, high temperatures or aggressive media and environments.

The double internal spring can be made from Inconel Alloy, stainless steel or PEEK and help prevent the extrusion of the seal when pressure is applied. The PEEK version of the springs also eliminates metal to metal contact, reducing wear and extending the operational lifetime.

Initially, PPE’s spring seals will be available with a 60-850mm internal diameter and a cross section between 3.53 and 8.4mm.

Spring seals from PPE

Emerson launches wireless guided wave radar level transmitter Emerson Process Management has launched its wireless Guided Wave Radar (GWR) transmitter for continuous level and interface monitoring.

The Rosemount 3308 wireless GWR transmitter has been introduced to meet the need for accurate level monitoring in remote or difficult to reach locations where installing new cabling would be costly or impractical.

GWR transmitters are used for a broad range of measurement and control applications, including process level measurement in vessels and storage tanks in refineries, oil fields, offshore platforms, chemical and industrial plants.

Emerson says its wireless technology reduces installation and configuration time; since

there is no need for cabling, trenching, conduit runs and cable trays, costs can be reduced by 30% or more compared with a wired solution. Any WirelessHART enabled device can join the network once a wireless network has been established, making it possible to implement changes or move devices around to meet specific requests.

The Rosemount 3308 Wireless GWR transmitter adds visibility across a range of industries and applications, ensuring plant and operator safety while improving process efficiency.

It is a top mounted device for direct level and interface measurement of liquids. It is virtually unaffected by changing process conditions such as density, conductivity, temperature and pressure, and because it

Titan Logix releases new product for mobile tank gauging Emerson’s GWR transmitters can be used for level measuring in storage tanks

does not have moving parts, no calibration is required and maintenance is minimised. A wide range of process connections, probe styles and accessories ensure application flexibility.

Pentair Thermal Management launches new detection device Pentair Thermal Management has launched its new leak detection monitor.

The TraceTek TS12 Touchscreen panel (TT-TS12) is able to manage leak detection installations by displaying information from a network of up to 250 TraceTek leak detection circuits. Its large panel gives users the capacity to monitor on one panel a large count circuit network, while the graphics and user interface are suitable for small installations as well.

With a 12” SVGA full-colour touchscreen, the TT-TS12 offers large graphic displays that are easy to understand and use for operators who may not be familiar with all of the TraceTek detection system details.

32

Detected leaks are displayed as a flashing icon superimposed on a background image that installers can input into the system through a USB socket, such as a site map, building floor plan or photograph of the monitored equipment or a satellite view of the entire facility.

The system can be used to replace older TTDM128 or TTB monitoring panels, as well as collect and display input from multiple TTDM panels that are already installed to provide a facility-wide master alarm panel. TT-TS12 is a fully networked system and, with LAN connectivity rights, remote users are notified of system events by email and are now able to view and control the detection system remotely via portable devices.

Titan Logix, a technology and controls company, has released a new addition to its line of liquid level gauging products for mobile tankers.

The Rack Control Module (RCM) works with Titan’s TD80 liquid level gauging and overfill prevention system to prevent overfills at loading racks.

Loading racks pump liquid petroleum or chemical products from a storage tank into a mobile tank truck or trailer.

Titan’s RCM allows the user to load at both optic and thermistor racks by providing the required electronic interlock connection between the TD80 and the rack.

July/August 2013 • TANK STORAGE

Contact Details

Neda

Engineering Group (Pty) Ltd.

terminal news

Neda Reception +27 13 755 4093 Neda Fax +27 13 755 4094 Website www.neda.co.za E-mail neda@neda.co.za Address 21 Brander Street,

P.O. Box 5251,

Nelspruit Mpumalanga,

1200, South Africa David Naudé +2782 442 6358

Designing and managing YOUR project in Africa Neda are a multi-faceted and multi-disciplinary engineering company operating in the bulk fuel storage of Oil, Gas and Chemical products throughout Africa

Multi-faceted Multi-disciplinary

• Mechanical Engineers • Structural Engineers • Civil Engineers • Electrical Engineers • Petroleum Engineers

Services

• Design and Project Manage Tank Farm Construction - as per API and NFPA Standards • Design and Project Manage Bulk Storage Facilities for LPG, Ammonia and other Chemicals - as per API and NFPA Standards • Design and Project Manage of airfield refuelling systems as per API and NFPA Standards • Permanent Life Assessment of existing plants and infrastructure • Due Diligence Assessments of mature plant • API 653; 570 and 510 Inspections with non-destructive testing (MFL, GUL, RT and UT) • Tank strapping and calibration to API MPMS standards.

• Project Managers, Consultants.

• EPC Contractors • Approved Inspection Authority • Design Engineers • API 653 and API 570 Inspection • Non-Destructive Testing

technical news

New Draeger flame detector offers protection in hazardous environments

This Flame 3000 can be installed at a hazardous refinery

Draeger Safety UK has developed a new flame detector for the petrochemical and chemical industries.

The Draeger Flame 3000 is an explosion-proof image processing flame detector.

It has been designed for

WATER TREATMENT DISTRICT ENERGY CONSTRUCTION & BUILDINGS PROCESS INDUSTRY

TANK STORAGE

HIGH QUALITY VALVES

www.belven.com 34 add storage magazine StocExpo 2013.indd

1

standalone operation and can also be integrated with a control system or fire panel.

The newer Draeger model is based on the proven technology of the Flame 5000. Both detectors are suitable for use in hazardous environments such as refineries and chemical plants since the sensitivity is not affected by reflections.

The Flame 3000 can work alongside its range of existing flame detection equipment to create bespoke solutions. And, impervious to CO2 emissions along with hot gases and equipment, the flame detection system can be installed in any industrial situation where a potential fire source exists.

Knowsley SK signs five-year agreement with Shell Knowsley SK, the UK-based designer and manufacturer of fire safety equipment and systems and part of SK FireSafety Group, has signed a five-year enterprise framework agreement with oil major Shell.

The agreement incorporates the design, supply and maintenance of Shell’s fire safety equipment and systems, covering all upstream and downstream operations within Europe, the Middle East and Africa.

The agreement will also include the training of site personnel and the provision of engineering services associated with fire system design.

3/1/2013 9:27:17 AM July/August

2013 • TANK STORAGE

technical news

Praxiar to increase supply and extend pipeline system at Port of Antwerp

Praxair’s new plant will come online in 2016

Industrial gases company Praxair will build its second air separation plant and extend its pipeline system in the Port of Antwerp, the second largest petrochemical enclave in the world after Houston, Texas.

The new 1,300 tonne per day plant will increase Praxair’s oxygen and nitrogen capacity in the port and expand its business with customers under long-term contracts, including agreements with several leading global companies. Start-up of the air separation plant is expected in early 2016.

Praxair’s new plant and pipeline system will have the

ability to supply oxygen and nitrogen to most chemical companies in the port. The new facility is also designed to produce liquid oxygen, nitrogen and argon to support customers in a variety of different industries in Belgium and the Netherlands.

According to the Antwerp Port Authority, some of the world’s leading refining, petrochemical and chemical companies have announced more than €1 billion of investments into the port. The authority also projects an additional €1 billion of investments to be made in the near future.

A new oil and fuel cleanliness monitor Contaminated oils and fuels account for almost 85% of all breakdowns. Particulates invisible to the naked eye are the root cause of mechanical failures in hydraulic, lubrication and diesel engine applications.

Filtertechnik’s Particle Pal is a self-contained battery-powered field kit that takes a small feed of oil or fuel from a system or tank and passes it through a laser counter.

The unit has a display that gives a live reading of the cleanliness class in ISO, NAS or SAE standards.

Water monitors can also be added onto the unit to give the ppm count of water. The

rechargeable battery is designed to give eight hours of continuous use. The kit is suitable for field or laboratory use. It features: • Self-contained design • Plug and play operation • Uses the latest laser particle counting technology • Sample direct from a storage tank or from a sample bottle

Up to standard: the Particle Pal from Filtertechnik

• Oil and fuel cleanliness readings to ISO/NAS/SAE spec in real time • Alerts to the presence of high moisture levels and bacterial contamination • Data log and graphical analysis via USB link to PC.

New elevated temperature vessel lining system

Storage tanks are protected from corrosion with Belzona’s elevated temperature lining

TANK STORAGE • July/August 2013

High temperature vessel linings company Belzona has introduced to the oil and gas market an elevated temperature lining.

The system offers longterm corrosion protection and is resistant to a broad range of chemicals commonly found in storage tanks and process vessels. Downtown is reduced by fast application

and rapid cure time.

In addition to manufacturing products, Belzona provides a complete supply and apply package through its global distribution network, established to provide clients with direct access to its products, specialist application, inspection/supervision and training services.

35

terminal news

Level Gauging, Safety Equipment & Inventory Management Solutions

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www.ljtechnologies.com July/August 2013 • TANK STORAGE sales@ljtechnologies.com

incident report The latest information on fires, leaks, spills and accidents in the chemical sector n 06/07/13

Montreal, Maine and A train carrying 72 carloads of crude oil derailed in Lac-Megantic, killing at least five people.

Atlantic Railway Forty people are still missing.

Quebec, Canada It created a huge fireball and witnesses said they heard six large explosions throughout the night.

Around 120 fire fighters were called the tackle the blaze, which still had not been brought under control hours later. The train left the tracks at approximately 1.20am.

Everyone within a kilometre of the incident – a reported 2,000 – was evacuated.

The crude oil, which was destined for the US coast, flowed through the streets of the town. The environmental damage was not immediately known.

A fuel leak which caused thousands of gallons of petrol to flow into a nearby storm sewer in n 22/06/13 Buckeye Partners

Frazer, Pennsylvania, US Frazer was attributed to a faulty gasket on a storage tank.

The tank was part of Buckeye Partners’ Malvern terminal which stores and distributes petroleum products. The petrol escaped from the vapour containment unit of the facility.

The incident was reported after 3.30pm. The exact amount of lost petrol will be determined by metering. n 22/06/13

Larraine Marketing Around 3,000 litres of bunker fuel leaked from a storage depot into the Pasig River.

Santa Ana, Manila, The escaped fumes left four people, including a two-month-old infant, hospitalised with the Philippines breathing difficulties. Oil booms were set up to stop the fuel from spreading.

n 11/06/13

Imperial Oil, Plains Midstreams Canada and Enbridge Pipeline Sarnia, Ontario, Canada

Crude oil spilled between the Imperial Oil Terminal and the Marcus Oil Terminal in Sarnia.

The incident was reported at around 8.30am, with the National Energy Board

announcing that the release was thought to be located along a right-of-way containing pipelines belonging to Plains Midstream Canada, Imperial Oil and Enbridge Pipelines.

Around 5 barrels of oil were discovered and all pipelines were shutdown to prevent any more oil from leaking.

Absorbent booms were placed along the river but no oil flowed into the St. Clair River.

An excavation will reveal the cause of the spill.

Work has started to clean up a former oil storage site after petroleum wastes left the area n 11/06/13 Charter International

Oil Indiana, US polluted.

The state’s environmental agency is carrying out the clean-up procedure, which began at the end of June and is scheduled to last for 12 months.

Between 1978 and 1990 Charter International Oil, owned by CBS, operated at the 11 acre Ohio River city facility storing fuel, petrochemicals and solvents. A number of spills and leaks occurred at the site between 1969, when 20,000 gallons of paint solvents spilled, and 1983, when xylenes (a compound found in petrol) escaped.

Agency officials said the area will be cleaned in two stages. The first phase is already underway, with the second planned to begin in 2014-2015. n 02/06/13

PetroChina Two people were killed in an explosion at PetroChina’s Dalian refinery.

Liaoning province, China The blast occurred in a residual diesel oil tank, causing nearby tanks to catch alight.

The second tank affected by the explosion was under renovation and production was expected to resume later this year.

n 23/05/13 Petrogold One person died when a fire at Petrogold’s fuel depot spread to six large storage tanks.

Rio de Janeiro, Brazil The victim was a 43-year old male employee. He was taken to hospital but, with 90% of his body covered in burns, died soon after.

A large area surrounding the blaze, which contained homes and a school, was evacuated. Fire fighters struggled to contain the fire for some time.

An investigation into the cause of the incident was launched. Petrogold was operating at the site without an environmental license, according to reports at the time. n 18/05/13

Enbridge Pipelines Lincoln County, Oklahoma, US

Around 2,500 barrels of WTI-grade sweet crude oil was released from Enbridge Pipelines’ Cushing South Terminal. The oil leaked from a tank fill line into terminal containment structures.

The source of the leak was soon identified and a repair plan implemented. The company said overnight thunderstorms slowed the clean-up operation.

A member of the Pipelines and Hazardous Materials Safety Administration (PHMSA) remained at the site to inspect the failed tank fill line prior to its repair. Continuous air monitoring showed no hazardous emissions were detected outside of the facility.

No one was injured.

TANK STORAGE • July/August 2013

37

uruguay

Uruguay gets connected

Schandy, a partner of Latin American forwarding and logistics network Ultramar Logistics, is building Uruguay’s first independent tank terminal with a pipeline connection to a port.

Schandy already operates one inland tank farm and is due to complete a second, connected to the port of Nueva Palmira, by the end of July. The company discharged its first vessel on 22 June and started dispatching fertilizer on the following day, based on a five year contract in place with an oil, gas and fertiliser business. Everything is set to finalise the details to discharge a full load during the second half of July.

The first stage of the new terminal has a capacity of 11,000m3, consisting of five tanks. The tanks will be capable of storing liquid fertilisers such as urea ammonium nitrate (UAN).

The company plans for a second stage for additional tanks to be built for fertilisers and to store vegetable oil and fuels.

Uruguay’s economy is mainly based on agriculture.

Related exports last year resulted in 32% of GDP. Schandy decided to build this terminal because it perceived the need to supply the agricultural sector with liquid fertiliser from overseas. In the past, the only source of supply was neighbouring Argentina, from where the fertiliser had to be expensively transported by truck.

As a consequence of the improved logistics, Schandy expects a surge in demand for liquid fertiliser in the coming years, this being one of the main reasons why it has already started working on the expansion of the project.

Schandy’s client alone is planning to import about 40,000 tonnes per year through the terminal, a volume representing 60% of the total UAN market in Uruguay and 100% of the fertiliser imported in liquid phase.

Construction was carried out in time and fashion by Ciemsa, one of the largest construction companies in Uruguay, and Turboflow, the biggest metalurgical contractor in the country.

38

July/August 2013 • TANK STORAGE

tank terminal update

Tank terminal update – Turkey Petro Kimya Holding Location Products Capacity Construction/expansion/ acquisition

Izmir, Turkey Vegetable oils and gas 403,724m3 Construction

Toros Tarim Location Products Capacity Construction/expansion/ acquisition Comment

Ceyhan, Turkey Crude oil and petroleum products 235,827m3 Construction 37 tanks with volumes ranging from 500-20,000m3

Petrol Ofisi Istanbul Terminals Location Products Capacity Construction/expansion/ acquisition

Istanbul, Turkey Petroleum products 973,760m3 Construction

TANK STORAGE • July/August 2013

This list is based on information made available to Tank Storage magazine at the time of printing. If you would like to update the list with any additional terminal information for future issues, please email keeley@horseshoemedia.com

39

tank terminal update

Tank terminal update – south america Petrobras Location Products Capacity Construction/expansion/ acquisition Project start date Completion date Investment Comment

ENAP Brazil, 55 miles from Rio de Janeiro Oil 2 million barrels Construction August 2012 (announced) June 2014 $318 million (€243.5 million) The floating oil terminal will enable tankers to refuel at sea, cutting the distances currently covered by oil vessels. The terminal will be the world’s first floating oil terminal able to refuel tankers at sea

Dow Quimica Terminal Location Products Capacity Construction/expansion/ acquisition

Guaruja, Sao Paulo, Brazil Chemical products 200,000m3 Construction

Location San Vicente Bay, Chile Products Oil Construction/expansion/ Construction acquisition Completion date June 2013 Investment $140 million (€107.2 million)

Pacific Infrastructure Location Products Capacity Construction/expansion/ acquisition Completion date Comment

Cartagena bay, Colombia Crude oil and derivatives Phase 1 – 3 million barrels Construction Q4 2013 Pacific Infrastructure signed a contract with Oiltanking International for project management services

This list is based on information made available to Tank Storage magazine at the time of printing. If you would like to update the list with any additional terminal information for future issues, please email keeley@horseshoemedia.com

made in Germany

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28.06.13 11:33 July/August 2013 • TANK STORAGE

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TANK STORAGE • July/August 2013

41

Assess your compliance needs with the API 2350 Readiness Kit and NEW Level Instrumentation Video.

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July/August 2013 • TANK STORAGE

brazil

Full Brazilian?

With the approval of 52 new private port terminals, the country is set for significant growth

by David Hayes

Brazil’s liquid storage market has started to enter an important new growth phase.

A number of terminal operators are launching third party storage expansion schemes to increase capacity at existing terminals and to develop large new terminals in various different areas of the country.

Growing export orders for vegetable oils and biofuels are forecasted to lift demand for liquid storage capacity in Brazil as global markets recover. An awaited expansion in refining activities is expected at the same time to lift demand for independent storage as staterun refineries look to outsource part of their storage needs, while crude production from new oil fields also will help lift storage needs in future.

At the start of July, Brazilian President, Dilma Rousseff, announced approval for construction of 52 new private port terminals from a list of 129 proposed port terminal projects currently being assessed by the government, including 11 new liquid cargo terminals.

Total investment required to build the new terminals, most of which are planned for construction in northern Brazil, is estimated at about 11 billion Reals (€3.7 billion).

According to government regulations, once a port terminal project is approved, the developer has three years to complete construction

and begin commercial operation. All terminals for which building approval has been granted so far have full necessary documentation.

Other developers planning to build port terminals, including liquid storage facilities, have until August 5, 2013 to submit applications if they wish to be included in the current port terminal project assessment programme.

Authorisation announcements for the next tranche of approved terminal projects will begin on September 21, 2013.

Cattalini Terminais Maritimos (CTM), one of Brazil’s largest storage terminal operators, is looking to build at least two new terminals over the next five years. The company currently operates three adjacent terminals totalling a combined capacity of 380,000m3 in Paranaqua Port, but is looking to build

TANK STORAGE • July/August 2013

a fourth in southern Parana that will increase its total storage capacity to almost 700,000m3 when completed.

‘We are working hard to build a new installation that will total 300,000m3. It will handle import demand for diesel fuel and petrol,’ explains Carlos Kszan, new business manager at CTM. We are now in the final phase of the Environmental Impact Assessment study and we expect to start work at the end of this year. It will take two years to build.’

The new terminal is expected to be built in two phases, each phase providing a similar storage capacity.

Kszan noted the new terminal will serve the same hinterland area as the company’s existing terminals, which are used by clients to store cargos for delivery within a radius of about 400km

from the port location.

Soyabean oil exporters located within the same region use CTM’s terminal facilities to store their edible oil ready for export.

‘For the next five years we think the terminal business here will increase according to Brazil’s economic situation.

The terminals we have are strongly influenced by petroleum and refined products demand,’ Kszan says.

‘Our Paranaqua terminals are for both export and import cargos. We work with several products, not only petroleum.

Brazil is a big producer of ethanol, for example, and we work with chemicals as well.’

CTM’s adjacent Paranaqua Port Terminals 1, 2 and 3 together form the largest privately operated liquid storage complex in Brazil.

The three terminals offer a combined 380,000m3 of

Paranaguá Terminal – Brazil Paranaguá is a historic town with more than 400 years of existence. The second largest port in Latin America in handling capacity is installed there.

Liquids • Products handled: vegetable oil, chemical and corrosive • Total storage capacity: 56,524m3 • Tank capacity: 470m3 to 4,950m3 • Tanks: 24 • Jetties: 2 • Lines to the pier: 3 • Berth depth: 10-12m • Terminal area: 26,898m2 • Rail Bypass Uniao Vopak is a joint venture between Ultracargo and Vopak.

43

brazil storage facilities in 97 tanks.

Terminal 2 provides around 90,000m3 of storage which is used to store soyabean, palm and other vegetable oils.

Terminals 1 and 3 are used for storing other products including fuel, gasoil, chemicals and methanol. However, crude oil is not stored as the terminals are not equipped with heating facilities necessary for crude storage.

Brazil is a major producer of ethanol from molasses and biofuel companies are important clients. Kszan points out that bioethanol exports are influenced by global sugar and ethanol prices, which affect the flow of bioethanol cargos through CTM’s terminals.

‘Last year and currently, with regard to international ethanol prices, maybe it is more profitable to use sugarcane molasses to make sugar or to sell ethanol domestically in Brazil. What we see is probably that ethanol exports will not be big this year,’ he remarks.

CTM has seen important changes in the use of its tank storage facilities during the past decade, an experience that many other Brazilian third party terminal operators also share. About 60% of the liquid cargos stored in CTM’s Paranaqua Port terminals, until 2006, were for export.

Since then the proportion of import cargos has grown

to account for about 70% of all storage contracts, with most storage tanks rented being for methanol and fuels, including diesel and petrol, due to the failure of Brazil’s refining industry to expand and keep pace with the growth in domestic petroleum demand.

Meanwhile, CTM recently signed an agreement with VTTI of the Netherlands to conduct a feasibility study to construct a new terminal to handle crude oil exports. The size and location of the terminal have still to be decided but will conform to international oil major requirements.

Kszan says. ‘Our intention is to develop a new terminal to support crude oil exports, supporting the likes of Petrobras and international oil companies. We will study the best location for the new terminal and hope to be in operation in 2016 or 2017.’

Many third party storage terminals in Brazil are presently owned by local companies who operate a single terminal serving their local regional market. This situation is expected to change as demand for bulk liquid storage increases creating opportunities for international

Terminal operators are expanding existing facilities for rising petroleum and chemical imports

terminal operators to develop large modern terminals.

‘There are not many international third party operators in Latin America yet but a lot of local terminal companies are doing well,’ commented the manager of one foreign-managed terminal. ‘The next five to 10 years are likely to see a consolidation in the market as internationalisation takes place. Terminal operators need to give a good performance in meeting health and safety standards and in preventing environmental pollution to comply with global oil major and other international clients’ standards and requirements. It’s a global market now.’

Chemical cargos are also expected to grow in importance as the Brazilian economy expands, while exports of vegetable oils and biofuel also will increase storage demand along with the Cattalini Terminais Maritimos (CTM), one of Brazil’s largest storage rising volume of oil and terminal operators, is looking to build at least two new terminals over the next five years petroleum shipments.

44

The minimum size terminal likely to be constructed will be about 300,000m3, capable of holding around 2 million barrels of oil.

The terminal is planned to support production of oil in the south of Brazil, which will be produced for export and not for supply to new refineries planned for north and northeast Brazil.

‘The maximum size of the terminal will depend on profitability. We are just at the beginning of the study,’

Chemical products handled by storage terminals include caustic soda, phosphoric acid and sulphuric acid, the latter being used by Brazil’s large mining industry for metals extraction. Chemicals used in paint manufacturing and by the construction industry are handled as well along with chemicals for the pulp and paper industry which is an important sector in Brazil.

‘Oil cargo flows are slightly different to chemical flows but many refineries are old and need upgrading,’ the manager remarks. ‘A number of new refineries being built in Brazil are not yet completed. ’Most of Petrobras’ oil reserves are in deep waters, so a huge investment is required to develop these.

The company cannot afford to do everything so we expect cooperation agreements to be signed with independent terminal operators to take care of part of Petrobras’ downstream storage requirements. This trend is beginning, but slowly.

We will see a lot more of this over the next 10 years.’

Government plans to support construction of new refineries in north and northeastern Brazil are part of wider efforts to promote economic growth in those less developed areas of the country. This is expected to increase demand for oil and petroleum storage capacity in the developing regions as new refineries are built.

Petrobras is currently building two refineries: one in Comperj, Rio de Janiero and the other in Abreu e Lime, Pernambuco but both projects are behind schedule.

The Abreu e Lima refinery is due to be completed first, but not until the end of November 2014 at the earliest.

China and South Korea are now poised to become involved in expanding Brazil’s refining capacity which still will not be sufficient to meet full national demand once

July/August 2013 • TANK STORAGE

brazil these two under-construction units are completed.

Petrobras announced this June it had signed a letter of intent with Sinopec of China to study a possible joint venture to build a Premium One refinery in the northeastern state of Maranhao that will help reduce Brazil’s large imports of petrol and diesel fuels.

News of the agreement with Sinopec followed shortly after Petrobras announced the recent signing of an accord with GS Holdings of South Korea to investigate the feasibility of forming a joint venture to build a Premium Two low-sulphur diesel refinery near Fortaleza on the northeast coast.

According to Petrobras the proposed refinery would be able to process about 300,000 barrels per day of Brazilian crude oil, starting in late 2017 – about 65% of which would be diesel fuel.

With the planned completion of new refining still some years away, a number of terminal operators are expanding their existing storage facilities to handle rising petroleum and chemical imports as overseas supplies help meet rising local demand.

Vopak Brasil, for example, recently started work during the second quarter this year expanding its two main terminals in Alemoa, Santos and in Aratú, Bahia. The two expansion schemes will add a combined 52,000m3 and lift Vopak’s total storage capacity in Brazil, where the company operates three terminals handling petroleum, chemicals, biofuels and vegetable oils, from 311,000m3 to 363,000m3.

According to Daniel Lisak, MD of Vopak Brasil, the company is upgrading its 162,000m3 Alemoa terminal which is equipped with 112 tanks ranging from 500m3 to 3,750m3 in size, including stainless steel tanks.

The Alemoa facility is Vopak’s largest in Brazil. New tanks are being built which will add 37,000m3 of storage,

lifting the terminal’s storage capacity to 199,000m3.

The 91,000m3 Aratú terminal in Bahia is Vopak’s second largest facility in Brazil. The terminal has 60 tanks ranging from320 m3 to 3,500m3 in size, including carbon steel tanks with temperature isolation facilities.

Plans for the Aratú terminal involve adding a further 15,000m3 of storage capacity, raising the terminal’s total capacity to 106,000m3.

Brazil’s large size and economic growth potential mean that most liquid cargo sectors are likely to require greater tank storage facilities in future. Oil, refined products and biofuels are expected to require more storage facilities as exports are forecasted to grow, while import facilities for chemicals are likely to grow in the future as Brazil seems unlikely to become a chemical exporter for some years yet.

Due to the growing market for fuels, the north and northeastern region presents opportunities for independent or captive terminals.’

Chemicals consumption growth, meanwhile, is expected to be driven

by Brazil’s pace of economic growth.

The expansion added 22,000m3 in capacity, lifting the terminal’s total number of tanks to 23 and its storage capacity to 70,000m3.

‘We used to have more exports, now we have more imports. Most of our business is from domestic customers for distribution,’ comments an OT

The Brazilian chemical industry has lost market share due to the high tax burden and the exchange rate ‘The Brazilian chemical industry has lost market share due to the high tax burden and the exchange rate. Despite the strong growth of imports, they are concentrated in the finished products,’ Lisak says. ‘The market for liquid bulk in this segment has been stable in recent years. For the next few years market

source. ‘Cargos come from San Paulo and clients distribute all products in this area.’

Mergers and acquisitions also represent another growth option for terminal companies looking to expand their storage portfolios.

Ultrapar Participacoes last year announced it had, through Ultracargo, acquired Terminal Maritimo do Maranhao from Temmar Netherlands and Noble Netherlands, both being subsidiaries of the Noble Group.

Temmar is a modern liquid terminal located in the port area of Itaqui in northeastern Brazil. The terminal’s 55,000m3

storage capacity is used mainly for handling petroleum and biofuels.

Temmar’s Cattalini Terminais Maritimos expected the terminal business to increase acquisition lifted to alongside Brazil’s economy seven the number ‘Oil production and is expected to grow in line of storage terminals that domestic refining capacity with the GDP growth.’

Ultracargo operates in Brazil is currently balanced. In the Other terminal operators, handling fuels, biofuels, coming years, expected further such as Oiltanking Terminais chemicals, vegetable oil growth in production could (OT), also are expanding and other products. generate storage demand for their storage facilities.

Other terminal locations this market,’ Lisak comments.

OT completed a storage include Santos, Rio de Janiero, ‘In regards to biofuels, expansion project last year Paulinia and Paranagua, the considering that Brazil is at its Vitoria terminal in latter being a joint venture competitive in the production Vila Velha, Espirito Santo, terminal with Vopak that has 24 of ethanol from sugarcane, which also serves growing tanks and 56,500m3 of storage national and international surrounding industrial centres capacity, handling mainly consultants predict a significant including Rio de Janiero, vegetable oil, chemicals increase in exports until 2020.

Bahia and Minas Gerais. and corrosive liquids.

TANK STORAGE • July/August 2013

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July/August 2013 • TANK STORAGE

panama

Opening up the Pana-ramic view Tank Storage magazine catches up with a project in Panama aimed at widening its famous canal to increase options for bunker and liquid cargo storage

by David Hayes Now at the halfway stage, Panama’s $5.2 billion (€3.9 billion) canal expansion programme (PCEP) is expected to have a major impact on the international marine cargo transport industry once work to widen and deepen the 77km waterway, plus construction of a third set of locks, is completed in 2015.

The expansion project has been planned as a way to increase the volume and size of vessels transiting the waterway.

Demand for bunkering and storage facilities for marine fuels is expected to increase via the growth of permitted shipping through the widened Panama Canal.

The impact of the widening on Panama’s third party liquid storage industry for other cargos, including petroleum, biofuels, chemicals and edible oil, is less clear at present.

A number of terminal operators see opportunities for Panama to develop into a liquid cargo distribution hub, mirroring the forecasted development of the nation as a container and dry bulk shipping trans-shipment hub.

Several tank terminal construction and expansion schemes are already underway that are expected to add a range of liquid cargos in addition to bunker fuel.

Whether non-bunker liquid storage grows in the future will depend on Panama’s growth as a liquid storage hub, in addition to the canal’s

increased importance as a cost-saving shipping route.

The PCEP consists of the construction of two new sets of locks – one on the Pacific and the other on the Atlantic side of the canal. Each lock will have three chambers, each containing three water reutilisation basins.

The expansion programme also includes the widening and deepening of existing navigational channels in Gatun Lake and the deepening of Culebra Cut. To open a new 6.1km long access channel to connect the Pacific locks and the Culebra Cut, four dry excavation projects also are being carried out.

The growing use of the Panama Canal in recent years has been mostly due to increased US imports from China. Containerised cargo has replaced dry bulk as the canal’s major cargo segment so, while once first placed, dry bulk is now the canal’s second largest source of shipping transit fee income.

Bulk liquid transport fees, once the second largest source of transit fee income, now occupy fourth place after being overtaken by vehiclecarrying vessels which have become the canal’s third largest revenue generators.

While the growth of shipping through this widening project is expected to increase demand for bunkering and storage facilities for marine fuels, the likely impact on Panama’s third party storage industry for other liquid cargos

TANK STORAGE • July/August 2013

is less clear at present.

According to industry figures, over the past few years, tankers carrying about 700,000 to 800,000 barrels of liquid cargos, of which about 100,000 barrels is crude oil, pass through the Panama Canal each day.

In comparison, tankers carrying about 2.2 million barrels of liquid cargos pass through the Suez Canal daily, most of them carrying product cargos.

‘Panama’s problem is only 14% of the world’s tanker fleet fits through its canal currently. However, after the widening, around 46% of the global tanker fleet will be able to fit through,’ notes Chris Skrebowski, director of Peak Oil Consulting.

‘Panamax vessels are about 70,000 to 80,000 dwt, but after the widening vessels using

of up to 120,000 dwt, maybe larger, could get through. The size of the vessel depends on a ship’s design; some tankers are wide but shallow, so can go through more laden.’

Work to widen the Panama Canal is also expected to have important implications for global LNG trade in the future as larger gas carriers will be able to transit the canal.

‘Where Panama could also hold a lot of importance is with LNG as the US is planning LNG exports from shale gas.

The Far East is a high priced gas market so it should be attractive to ship US LNG to East Asia,’ Skrebowski adds.

‘A limited number of LNG carriers use the Panama Canal now because of their size but, after the expansion, about 80% of LNG carriers will be able to go through.’

The growing use of the Panama Canal in recent years has been mostly due to increased US imports from China

47

panama The Panama Canal Authority is forecasting the volume of cargo passing through will grow by an average of 3% annually in future. As a result, the total tonnage carried in 2005 by transiting vessels is expected to double by 2025.

Work is meanwhile underway to increase the capacity of Panama’s liquid cargo storage industry.

Telfers is building a new terminal on the Atlantic coast designed to hold 1 million barrels and include some clean product storage tanks, while two existing terminals are increasing their storage capacity by building new tanks designed to hold a combined 500,000 barrels of various products.

According to the Panama Shipping Council, the country’s 14 terminals, including the one under construction by Telfers, have a combined capacity capable of storing 28.9 million barrels of oil and some other products.

Currently around a 49% share, or almost 14.5 million barrels storage capacity, is owned by Petroterminales de Panama (PTP) in terminals in the western provinces of Bocas del Toro and Chiriqui.

The remaining share of storage is used mostly for bunkers. However, a terminal being developed by Vopak at Bahia Las Minas on the Atlantic Coast, with an eventual capacity to store about 3 million barrels of liquid cargo, is understood to include some clean product storage tanks.

‘The Atlantic Basin historically had the largest bunkers sales since the 6.4 million barrel Chevron Bahia Las Minas terminal was at the former Texaco refinery,’ explains Javier Ortiz, first VP of the Panama Chamber of Shipping. ‘The terminals at the other end of the canal, at Christobal and Bilbao, had almost the same capacity.

‘Over time other terminals were constructed on the

48

Pacific Basin – first was Italybased Decal’s in 2003, with a subsequent expansion in 2012/2013. Then the Melones terminal was finished in 2012.

These have gradually shifted the highest percentage of bunker sales to the Pacific, so what drives the market here is bunkers for the meantime.’

A number of new terminal and expansion projects have increased Panama’s third party tank storage capacity in the past few years, creating overcapacity for the moment.

For example Decal is investing $65 million to expand its Taboguilla Island terminal and will almost double its storage capacity to 2.24 million barrels capacity.

and Caribbean Basin due to the installed capacity.

However, the timing has not been forecasted.’

Following the widening, Panama is expected to develop into an important trans-shipment and distribution hub, with the government’s vision being to model Panama’s hub development on Singapore.

Container handling facilities are being expanded at present, with liquid terminal storage capacity, break bulk dry cargo and other cargo handling facilities also expected to grow in future.

‘Panama as a hub is developing at both ends of the canal. If you look at Latin

Fuel oil terminals along the Panama Canal

TERMINALES DE CRUDO Y COMBUSTIBLE MARINO

PETROBUNKER PETROPORT – 0.5 MB PTP – CHIRIQUI GRANDE – 7.0 MB

OIL TANKING – 0.6 MB

BAHIA LAS MINAS CHEVRON – 6.4 MB

TELFERS – 1.0 MB en construcción

BAHIA LAS MINAS VOPAK – 3.0 MB

PANAMA OIL TERMINALS CRISTOBAL - 1.0 MB

PTP – CHARCO AZUL – 7.0 MB

RODMAN PATSA - 1.2 MB

Fuente: Cámara Marítima de Panamá

DECAL – 2.2 MB MELONES OIL TERMINAL – 2.0 MB

Melones Oil Terminal, a 2.1 million barrel tank farm that opened at the end of 2012 on Islas Melones, around eight nautical miles from the Pacific end of the Panama Canal, also has expanded local storage capacity.

‘The widening of the Panama Canal has already brought investments in new terminals with about 3 million barrels of storage plus expansion of current terminals has brought about 1.5 million barrels, thus increasing the country’s bunker fuel capacity during the past three years,’ Ortiz adds.

‘Some terminal operators expect a bunkers trading and storage hub to develop for the region – US Gulf

PANAMA OIL TERMINALS BALBOA - 1.0 MB

American Pacific countries, shippers cannot do big parcels to Chile, Peru, Ecuador and others, so it is good to break bulk in Panama,’ comments a manager at one foreignoperated terminal.

‘Panama Canal is being broadened and we expect more liquid cargo flows through there. Also, looking at the shipping market, there will be more bunkering as well. Panama is an important bunkering point as ships queue up to cross the canal, so they make use of their waiting time by bunkering.’

In addition to using Panama as a hub to store liquid cargos for distribution in the Americas, oil majors and traders may want to use

Panama’s storage tanks to trans-ship cargos in the future, including crude oil, some of which is handled by PTP. PTP operates the TransPanama oil pipeline that connects the company’s two terminals located at either end of the 81 mile pipeline, built in 1982 originally to transport crude from the Alaskan North Slope to refineries in the Caribbean and the US Gulf Coast.

‘For several years they only pumped from the Pacific to Atlantic as Alaskan crude was available in those days.

That changed and the flow of crude is now from the Atlantic end of the pipeline to the Pacific end,’ Ortiz explains. ‘After Alaskan crude became unavailable, PTP took on a project to change the direction of flow in the pipeline. They built more pump stations and reversed the flow, so now there is a fair volume of crude in the pipeline.’

One of the customers using the PTP storage terminals at both ends of the TransPanama pipeline is BP which has a seven year storage and transport agreement with PTP that began in February 2012.

According to BP, the company has leased 5.4 million barrels of PTP’s storage capacity in the company’s two Atlantic and Pacific coast terminals and has committed to ship crude oil east to west through the pipeline at an average of 100,000 bpd.

BP signed the agreement to shorten the journey to the US West Coast for crude normally carried on VLCC ships around Cape Horn in South America.

Instead it now charters VLCC vessels to transport crude from the Atlantic Basin to the Carribbean port of Chiriqui Grande from where the oil is unloaded, stored and then sent by pipeline to PTP’s Pacific coast terminal for storage.

The crude is then loaded onto tankers bound for the US West Coast where it is delivered to refineries.

July/August 2013 • TANK STORAGE

turkey

Turkey: s n o more c n a h pros t

by Amy McLellan

These are interesting times to be writing about Turkey. This strategically located country, at the crossroads of energy and trading routes linking East and West, has been gripped by weeks of protest and an increasingly authoritarian response from the government of Prime Minister Recep Tayyip Erdogan, who came to power in 2003 and led his Islamic-leaning Justice and Development Party (AKP) to three election victories.

Ten years on from his first election win, a decade that has brought stability and economy prosperity after the troubles of the 1990s, and Erdogan, a devout Muslim who has vowed to respect Turkey’s prized secular traditions, is facing the first major protests against his rule. Many of those taking to the streets, initially in Istanbul’s Taksim Square, and subsequently across the country, cite growing concern at what they perceive to be an undermining of secularism following a failed bid to criminalise adultery and proposals to introduce alcohol-free zones. In addition to the police’s use of water cannons and tear gas, Erdogan’s response

to the protests has been couched in inflammatory language, aligning the protesters with foreign media and financial speculators.

It is the kind of rhetoric international investors are used to hearing from countries like Venezuela and Iran but not from Turkey, an economic powerhouse. It delivered growth of 8.5% in 2011, although this slowed to 2.2% last year, and was lauded as an exemplar during the turmoil of the Arab Spring. The response has spooked the markets, with the stock market taking a beating and Germany postponing talks designed

to revive Turkey’s ambitions to join the EU. Even so, this is a country with a growing economy, strong banks and investment grade ratings from Moody’s and Fitch.

Analysts at Fitch say they do not expect the anti-government protests to threaten Turkey’s BBB- rating, stating that the levels of unrest are ‘well within the tolerance of political stability embedded in the current rating, and the economic impact so far is minor’. They note, however, that if the protests are poorly handled the situation could escalate: ‘Persistent political and social unrest could deter tourism,

Geographically Turkey is in an interesting location, with access to Black Sea countries and from there the Caspian Sea, as well as the Middle East and the Mediterranean

TANK STORAGE • July/August 2013

destabilise short-term capital inflows, drive up inflation and damage economic growth.

Longer-term aspirations to attract more FDI could also suffer a setback.’

At the time of writing, there appeared to be a lull in tensions. And world attention had switched to another fast-growing economic powerhouse: Brazil, where more than one million Brazilians have taken to the streets to protest against rising costs, government corruption and the expense of the 2014 World Cup. And, as country-watchers point out, the current dissent does not alter the geography which is at the heart of Turkey’s appeal to many investors.

‘Geographically Turkey is in an interesting location, with access to Black Sea countries and from there the Caspian Sea, as well as the Middle East and the Mediterranean,’ says Roy van Eijsden, MD of the Turkish division of Dutch project management and engineering consultancy Royal HaskoningDHV. ‘Then there are all the pipeline developments through Turkey, which make for very interesting links with liquid bulk storage facilities.’

49

turkey Indeed, the past decade has seen Turkey’s reputation as the gateway between resource-rich nations to the East and energy-hungry markets to the West cemented by multi-billion dollar pipeline projects. The country is not only the key shipping route for tankers from the landlocked Caspian nations and Russia but it also now hosts pipelines to take crude and gas from the Caspian, Russia, the Middle East and Egypt and deliver them into the heart of Europe. It is a position fraught with strategic significance as competing powers use pipeline routes as a proxy for their geopolitical positioning.

As Tank Storage magazine went to press, a decision was imminent on the routing of a highly strategic pipeline to take gas from the Shah Deniz field in Azerbaijan. Analysts cite some concerns however, like Turkey’s role as a transit nation may be undermined by its own burgeoning economic growth as its own needs could leave little excess to be transported

to Western neighbours further downstream.

Size

783,352km2, slightly larger than the US state of Texas

Population

73.64 million

Expanding storage The opportunities presented by booming domestic demand and strategic transit routes are well recognised by international storage operators. In January 2012, for example, Paris-quoted Rubis paid €72 million for a 50% stake in Turkish-Lebanese company Delta Petrol, which owned a terminal at the key strategic port of Ceyhan in southern Turkey, the destination point for the BTC and KC pipelines.

The site was created in 1984 and stores oil, gas and biofuels. As evidenced

by Rubis’ most recent results however, the current configuration of the terminal, which is dominated by trading clients, exposes the business to contango risks – 2012 was a difficult year and in Q1 2013 revenues were down 50% at €1 million. The French terminals group is investing heavily to expand and upgrade

Expansion is on the books for the Dilovasi terminal

50

Turkey: the facts

Capital Ankara Currency

Turkish lira

GDP

$794 billion, the 18th largest economy in the world

GDP per capita

Over $10,000, up threefold in a decade

Oil reserves

270 million barrels

Oil production

45,000 bpd

Oil imports

712,000 bpd (of which crude oil 392,000 bpd and refined products 320,000 bpd)

Gas reserves

218 BCF

Gas production

27 BCF

Gas consumption

1.5 TCF, with the bulk imported from Russia. Iran, Azerbaijan and Algeria also export gas to Turkey.

It also imports some LNG.

Refineries

Six, with throughput capacity of 714,275 bpd

Sources: IEA, EIA, World Bank

the terminal, which has been renamed Delta Rubis, although construction is being phased to align with contracted business.

New jetty works have been commissioned, representing an investment of €9 million, to replace a conventional buoy mooring system – the 2.3km jetty will have six berthing stations and be able to accommodate Suezmax-type vessels – and the tank capacity is being expanded from 650,000m3 to 1 million m3 by early 2015.

According to CEO Sami Habab, it makes sense to invest in the downturn.

‘Construction costs are 25% cheaper and we can reap the benefits in the upturn market.’

New contracts

are already coming in. In February 2013, Azerbaijan state oil company SOCAR signed a storage agreement with Delta Rubis after it was granted a licence to sell bunker fuel. The fiveyear supply agreement will include fuels, aviation and marines sales businesses.

Other terminals in Turkey are also expanding. Solventas, which was established in 1967 and is based at Izmit Bay, currently has 280,000m3 of storage capacity across 196 tanks but plans to expand this to 350,000m3, according to sales and marketing specialist Berk Mansur Delipinar. Its custom bonded warehouse provides a wide range of fully automated tanks, ranging in capacity from 108m3 to 8,800m3. Access is by road and by sea: there are two jetties, one capable of taking three vessels and six barges, and the other four vessels.

In all, it has capacity to handle 2,000 vessels a year.

Yilport Holdings, which has grown in recent years by

July/August 2013 • TANK STORAGE

turkey

Turkey’s key shipping and pipeline routes, current and planned Name

Linking

Distance

The Turkish Straits (the Bosporus and Dardanelles)

The Bosporus connects the Black Sea with the Sea of Marmara and the Dardanelles link the Sea of Marmara with the Aegean and Mediterranean

The Bosporus N/A is 17 miles, the Dardanelles 40 miles

2.9 million bpd of Caspian and Russia crude oil transited the Turkish Straits in 2010. It is notorious for being one of the world’s busiest chokepoints and is described by the EIA as one of the most difficult waterways to navigate

Canal Istanbul

A canal from the Black Sea to the Marmara Sea to divert shipping traffic from the crowded Bosporus

Up to 30 miles Could carry as many as 160 ships per day, including the largest oil tankers

Backed by Prime Minister Erdogan, this ambitious project would cost more than $10 billion and take eight years to build

Kirkuk-Ceyhan pipeline

Kirkuk in Iraq to the Turkish port of Ceyhan

600 miles

1.65 million bpd but actual flows are a fraction of this

Only one of the twin lines is operational with a capacity of 600,000 bpd. But there are frequent operational outages; in 2012 throughput averaged 300,000 bpd

BTC pipeline

Baku in Azerbaijan via Tbilisi in Georgia to Ceyhan

1,100 miles

1.2 million bpd

The pipeline came online in 2006 and ships light crude from Azerbaijan and Kazakhstan to Ceyhan for shipment via tankers to European markets

Bluestream

Russia to Ankara via the Black Sea

754 miles

1,550 million ft of gas per day

This $3.2 billion project was operated by Gazprom and ENI and is one of the deepest pipeline projects in the world.

It was commissioned in 2005

South Caucasus Pipeline

Baku to Tbilisi to Erzurum (runs parallel to BTC)

430 miles

820 million ft3/d

Led by BP and Statoil, operations began in 2006, shipping gas from the giant Shah Deniz gas field in Azerbaijan

Tabriz - Dogubayazit

Connects Tabriz in northwest Iran to Ankara

1,600 miles

1,930 million ft3/d

Commissioned in 2001.

Suffers from outages due to militant attacks

Nabucco/ Nabucco West

A proposal to carry Iraqi, Caspian and even Egyptian gas through Turkey, Bulgaria, Romania, Hungary and into Austria

826 miles (Nabucco West)

Scaleable, from 353 to 812 billion ft3

Backed by the EU and the US, this much-discussed and delayed proposal to reduce European reliance on Russia gas has had many iterations over the past decade. The shorter Nabucco West proposal involves shipping gas from Shah Deniz II gas field in Azerbaijan. It competes with the proposed Trans-Adriatic Pipeline (TAP) which would connect with TANAP, if built, and take gas from Greece via Albania and the Adriatic Sea into Italy. A decision is due mid-2013.

TANAP (The Trans-Anatolian pipeline)

The Shah Deniz field in Azerbaijan via Turkey into Europe

1,300 miles

570 billion ft3 rising The $7 billion project could start construction next year to 810 billion ft3 ready for first gas in 2019 in 2023 and 1.1 trillion ft3 by 2026

Notes

Capacity

3

Sources: EIA, BP, TANAP

snapping up ports, is among those keeping a close eye on market developments.

Yilport has a portfolio of five ports, of which four are in Turkey’s Marmara Sea region (Gebze, Gemlik, Yarmica and Gemport) and one in

Malta. In all the group handles over 1 million tonnes of liquid cargos a year, with a total capacity of 130,000m3 across two terminals. The products stored include organic and inorganic chemicals, vegetable oils, solvents and

TANK STORAGE • July/August 2013

petroleum products such as fuel oil and diesel as well as other dangerous goods.

The Marmara Sea region is a key area in terms of Turkish trade. ‘It’s close to Istanbul, where the major consumer market is and the region where

Yilport is located produces 35% of the country’s GDP,’ explains a spokeswoman. ‘Due to its location, the area is known for its vast contributions to the Turkish economy. Most of Turkey’s industrial plants are located in this region, which makes it the prime hinterland for the bulk of the nation’s export-import cargos.’

Another big player in the Dilovasi area is Poliport, which was founded in 1975 and today has 168,000m3 of storage. The jetty is 250m long and can handle vessels up to 50,000 dwt.

There are also bunkering and blending services.

Vopak keeps looking The fundamentals may make sense but there are still obstacles for operators seeking to establish a position in Turkey. Expansion is not always easy as operators need to access a suitable site, secure permits and approvals, and derisk the investment by signing long-term contracts.

Terminals giant Vopak, for example, has made no secret of its desire to establish a base in the country.

In 2008 the Rotterdamheadquartered company announced it was planning to invest in a greenfield terminal after acquiring a 26 hectare industrial plot of land in Yalova on the Sea of Marmara. The idea was to build an independent terminal and jetty serving the greater Istanbul area for the import of liquid bulk chemicals, oil and vegetable oil products.

The company said at the time that some of its major customers had expressed an interest in using independent storage facilities in this area.

Vopak hired Dutch engineering consultancy DHV, now known as Royal HaskoningDHV following a 2012 merger, to prepare an Environmental Impact Assessment but there was vocal opposition to the project

51

turkey

International gas pipeline projects

from local businesses and NGOs. The head of Yalova’s Chamber of Commerce even started a hunger strike, citing the dangers of storing chemicals in a region with known seismic activity (it is a fear not without some foundation given that in

52

1999, following a major earthquake, a local acrylic fibre manufacturer leaked acrylonitrile from a 45-year old tank. The company in question however, AKSA Acyclic, said it was the first and only accident it has ever had).

Four years into the process

and Vopak decided to withdraw from the project. ‘It became clear we could not obtain the necessary permits and licenses within a reasonable time,’ says a spokesman. Turkey, which the company describes as an ‘economic powerhouse’ is still on the radar, however. ‘It’s a very interesting location with the trade between Asia and Europe and the position on the Black Sea,’ he adds. ‘We are still interested but we have nothing running there at the moment.’

A network society Royal HaskoningDHV, which worked with Vopak to prepare the EIA on the proposed terminal at Yavlova, says that both Turkey and the international companies keen to participate in its astonishing growth are riding a learning curve about how to undertake these major infrastructure projects.

‘When dealing with Turkey it’s important to remember it is not a European country, nor is it a Middle Eastern country. It’s just Turkey,’ says van Eijsden.

‘It’s a fast-growing economy, with a young, well educated population and the people are highly ambitious and motivated to work, which creates its own dynamic.’

Western companies would be well advised to spend time finding the right local partner to open doors, ease communications and bridge cultural differences. ‘It is a network society,’ he explains.

‘People want to meet with you and can be very hospitable.’

Permitting can be a headache with the country slowly upgrading its legal framework and bureaucracy to meet international standards. On the World Bank’s ‘Doing Business’ league table, Turkey scores 71st out

of 185 economies; last year it was 68th. ‘Corruption is almost non-existent in Turkey when it comes to getting permits but you have to engage with the government departments on a personal level,’ advises van Eijsden. ‘You don’t get to cut corners but you do get more proactive information and feedback so you can fine tune your submissions in line with that.’

There are other differences that would-be investors need to manage carefully.

While many international communities have learned to engage and consult with local communities before breaking ground on big infrastructure projects, local Turkish contractors may take a different, less inclusive approach that can create problems. And there is also a difference in approach when it comes to derisking the capital investment.

‘When companies are looking to invest in Turkey they like to sign contracts so they know they have secure cash flows for the future,’ says van Eijsden. ‘This is a different approach from Turkish companies, which say they will sign up when the terminal is built. We can see that a lot of companies are looking at Turkey but they are also hesitating and taking a cautious approach, which is the healthy thing to do. It is a huge investment to make when you’re not sure what the market will look like and that’s why having that contracted business in place is so important.’

This cautious approach is prudent, and recent political events only underscore the rightness of this approach, but in the long-term Turkey holds the geographic trump card. Energy supply-demand economics, the changes in refining trade flows and Turkey’s own growth projections mean this will be an energy hub that will be difficult to ignore.

July/August 2013 • TANK STORAGE

turkey

Is Turkey a safe bet?

Turkey is the sixth largest economy in Europe and 17th in the world. It is a key transit hub and a natural bridge between energy suppliers like Russia, Turkmenistan, Azerbaijan, Iraq, Iran and the largest consumers of the region in mainland Europe.

Moreover, Turkey is a big energy consumer market as well. According to the World Bank, the investment needed to maintain the current energy balance in Turkey’s local economy will amount to $130 billion (€101 billion) by 2030.

In 2012, a total of 2.3 million tonnes of oil were produced in Turkey. In the same year, the domestic producible oil reserves were 43.2 million tonnes, while its refineries processed 22.1 million tonnes of crude oil and 21.9 million tonnes of oil products.

As Turkey’s largest industrial enterprise, with a revenue of $20 billion, Tupras is currently the only petrochemical refinery in Turkey. It is seventh largest in Europe with 28.1 million tonnes of processing and 5.5 million tonnes of storage capacity distributed among four different refinery locations: Izmir, Izmit, Kırıkkale and Batman.

The competitive capacity of the petroleum industry in Turkey is expected to increase in the near future, which will stimulate a demand for new investment. In 2006 Tupras made the strategic decision to invest $5.5 billion for new storage facilities, including the Residuum upgrading project.

Following this trend, the governmental organisation Energy Market Regulatory Authority (EPDK) has granted

two new refinery licenses. One of these licenses was issued to the Eastern Mediterranean Petrochemicals Refining and Industry and Trade (DAPRAS) in 2007 for the Adana/Ceyhan region. The second one was to SOCAR and Turcas Energy (STEAS) in 2010. The construction work has already started for the new STEAS refinery, called Star, in Izmir/Aliaga.

Engineering, procurement and construction (EPC) company Dema has just completed several projects at Tupras’ refinery.

In 2011 it started work at Tupras Kirikkale refinery (5 million tonnes/year processing capacity) with a project to build four asphalt storage tanks. This project was completed within 10 months.

For the design of atmospheric tanks and pressure vessels Dema employs Coade Tank and PV Elite software. Dema has designing experience for vertical, cylindrical, aboveground, closed and open top, welded carbon or stainless steel storage tanks in various sizes and capacities.

After the completion and approval of the design, a project specific plan is created with regard to location, available workforce and material supply. A list of all personnel is supplied to the customer after assigning the required key staff which is mainly divided in the areas of mechanical, construction, electrical works and the project management team.

This team organises and coordinates all material, logistic, financial and

TANK STORAGE • July/August 2013

production aspects of the project and maintains the communication and the flow of information with the main production facility.

Procurement The material lists specific to each project are compiled taking the accredited vendor preferences of the client into account and items are procured from the corresponding suppliers.

Another important aspect is the familiarity of the procurement specialists with the local suppliers.

Most of the material needed in the field can be procured within Turkey but some special materials, such as alloy steels or automated instruments, can require international suppliers. Nevertheless, in these cases, usually no serious problems are encountered in customs and transport.

The main means of transport are motorways but marine transportation constitutes a cheap and convenient alternative. However, rail roads in Turkey are not well developed and mainly provide access between terminal stations, refineries and ports.

Fabrication The machinery involved in this process includes CNC cutters, welding groove cutters, plate bending, profile bending, SAW tractor and SAW column.

Materials out of the production line get transferred to the sand blasting/painting section and subjected to surface preparation in accompaniment of a painting inspector.

Preceding the installation, Dema completes the civil work including groundbreaking and filling. Prefabricated elements then get transported to the field and fitted by Dema’s installation team.

Welding work in the field is done under adequate protection from open air conditions. All welders are subject to regular certification programmes to ensure that Dema is working with qualified personnel.

For a part of the field work, subcontractors are hired which operate under the supervision of the company’s project manager and are also accredited by the customer. Turkey offers a multitude of experienced subcontractors working in the construction sector.

Heat treatment and painting can be done on site.

After the installation, Dema undertakes hydrostatic and penetrator tests and NDT controls. The completion of the tests is followed by the filling of the tank and turning the field over to the customer.

In the last few years, laws and regulations in Turkey have begun to incentivise foreign investors. For instance, paperwork for founding a new company takes around six days in Turkey, whereas the OECD average is 15 days.

Corporation tax has also been reduced to 20%. Presently, there are 37,000 foreign companies operating in Turkey.

For more information:

This article was written by Dema Engineering & Construction, www. dema.com.tr, info@dema.com.tr

53

australia

Australia: A wealth of opportunities?

The closure of Australia’s refineries is providing increasing opportunities for bulk liquid terminal operators as the country’s refined petroleum products imports grow. Lynda Davies reports 54

Australia’s rising dependence on refined petroleum product imports could be a blessing for terminal operators as well as independent oil traders, export-oriented refineries in Asia and shippers. The shift comes as the number of oil refineries in operation across the country continues to fall.

The closure of Shell Australia’s Clyde refinery in Sydney at the end of September and the shutdown of Caltex’s Kurnell refinery, also in Sydney, planned for the second half of 2014, will reduce Australia’s refinery capacity to around 508,000 bpd, or by over a quarter of the early 2012 capacity level.

Furthermore, most of the five remaining refineries look vulnerable to closure as their owners grapple with competitive pressure stemming from larger and newer, lower cost refineries in the wider Asia-Pacific region.

Shell Australia announced in April it had put its last remaining operating Australian refinery, the 110,000 bbl/d Corio refinery at Geelong in Victoria, up for sale. The company has been reviewing the future of the operation for some time and says that while its efforts are towards achieving a successful sale, other options include converting the site to an import terminal. Both Shell and Caltex already plan to convert their respective Clyde and Kurnell refinery sites to import terminals.

In Australia, the price of petrol, jet fuel and diesel is

determined by the cost of import rather than the cost of production. The country now is a significantly more costly place to operate an oil refinery than it was a few years ago.

Australia’s total refined petroleum products consumption was around 930,000 bpd in 2012, of which diesel comprised 377,000 bpd, petrol 319,000 bpd and jet fuel 125,000 bpd, according to Australian Bureau of Resources and Energy Economics (BREE) data. Some 40% of this demand was met by imports.

In 2000, when there were eight refineries operating, Australia was balanced for transportation fuels being a small net exporter of petrol and jet fuel and a small net importer of diesel. In mid-2003, Mobil mothballed its 78,000 bpd Port Stanvac refinery in Adelaide, formally announcing its closure in 2009. Since the Mobil refinery mothballing, Australia has increasingly been supplementing refinery production with imports of finished products, particularly of petrol, diesel and jet

fuel. By 2010, imports of these products had risen to over 25% of demand, or around 220,000 bpd.

‘While Australia’s consumption of refined products is showing some growth, the real driver for growth in imports is coming from the refinery closures,’ says Chris Gascoyne, MD of consultancy FACTS Global Energy (FGE) in Singapore.

Imports of petrol, diesel and jet fuel into the country were running at around 250,000 bpd prior to the shutdown of Shell’s 72,000 bpd Clyde refinery last October, according to FGE. ‘The closure of Caltex’s Kurnell refinery in the second half of 2014 will take out a further 125,000 bpd of refining capacity, and the company is already starting to shut down some of the units, with the FCC unit to be closed in the second half of this year,’ adds Gascoyne. ‘In the event that Shell can’t find a buyer for its Geelong refinery, and closes the operation, a further 110,000 bpd will go.’

If the Shell Geelong refinery

Australian refineries Oil company

Refinery

Approximate capacity bpd

BP

Kwinana, Perth

137,000

BP

Bulwer Island, Brisbane

101,000

Caltex

Kurnell, Sydney

125,000*

Caltex

Lytton, Brisbane

80,000

Mobil

Altona, Melbourne

80,000

Shell

Corio, Geelong

110,000

*Capacity at the time the proposed Kurnell refinery closure was announced in July 2012

July/August 2013 • TANK STORAGE

australia is closed, Australia could see imports of petrol, diesel and jet fuel rise to something around 500,000 bpd by 2015/16, Gascoyne says, believing there is potential for even further growth in imports should further refinery closures occur.

‘If the proposed Euro 6 standard comes into force in 2016/17, it would be a real fork in the road for refinery operators as they would need to make a decision about further investment,’ Gascoyne explains.

While Australia’s consumption of refined products is showing some growth, Gascoyne sees the main driver for imports growth coming from the impact of refinery closures.

‘Australia’s petrol market has plateaued in the past four years or so. The jet fuel market continues to grow, but is a much smaller market,’ he says.

‘The diesel market is still growing quite strongly, but it is quite heavily linked to the commodity boom and the steam is running out of that, but we could see a couple more years of quite decent growth.’

There is no naphthabased petrochemicals industry in Australia.

For many years the restraint on fuel imports by independents (i.e. non oil majors) into Australia has been the lack of available independent tank storage. The refiners own the lion’s share of the country’s marine storage although independent storage operators – Stolthaven Terminals, Vopak, Terminals Pty (TPL), Coogee Chemicals, Neumann Petroleum (now owned by Puma Energy) and United Petroleum – also have facilities.

While still relatively small in volume, independent imports have been growing during the past five years.

One of the key factors driving this growth in independent imports has been a greater access to import terminals.

‘We are in an exciting place at the moment. The closure and rationalisation of

Australian refinery capacity is providing enormous emerging opportunities for terminal operators,’ says Graham Tumblety, national sales and marketing manager at Australia’s largest privatelyowned independent bulk liquid terminalling company, TPL, and president of the country’s Bulk Liquids Industry Association.

‘Much of our recent growth can be attributed to this dynamic. The sad fact for Australian manufacturing is that more refineries are likely to close. However, this will present further opportunities for terminal operators over the next five to 10 years,’ he continues.

‘Recently Stolthaven, which did not have a storage presence in Australia, bought in via its purchase of Marstel Terminals Pty. The only other international storage presence in Australia is Vopak, so we would guess, in time, other international companies will seek to enter the Australian market given the growth, refinery rationalisation dynamic and relative stability of the country,’ Tumblety adds, noting also the recent acquisition activity of Puma Energy in Australia and of Idemitsu Kosan’s purchase of Freedom Energy.

Terminal projects in Australia are high on the agenda for traders with storage operations or storage operators linked to traders, according to another industry source.

‘Australia has emerged as a key target market for Hamburg, Germany-based Oiltanking,’ Chin Hao Bay, the company’s commercial manager for Asia Pacific, says.

‘With the changing dynamics within its refining industry, and an increasing reliance on oil product imports, Australia has emerged as a key target market for Oiltanking in its overall growth ambitions,’ he explains.

‘Aside from the conversion of refinery assets to import terminals, expansions and greenfield facilities are

TANK STORAGE • July/August 2013

New kid in town: Stolthaven recently entered Australia’s storage market anticipated to be developed to support this fundamental shift. This in turn poses interesting prospects for infrastructure projects for which Oiltanking is actively seeking opportunities where it can play a role to meaningfully serve the industry at large.’

Chin Hao Bay believes there is some evidence to suggest the market is overheating, however, Fuelled by the massive growth of the mining industry, Australia has already attracted much interest that has led to recent acquisitions and potentially future divestments.

Some of these transactions tend to suggest that the market is overheating, he says.

He also notes the relatively strong Australian dollar and the slowdown in mining developments as representing some of the immediate challenges.

Nevertheless, Chin Hao Bay says Oiltanking maintains a positive view of the Australian market at large and remains committed to identifying viable long-term businesses whether through acquisition or greenfield developments in the country.

Expansion TPL owns and operates 233,811m3 of storage at four terminals in four major ports in Australia and has a further 100 million litres of storage capacity under construction or contracted for construction. The company also has plans for other new terminal developments.

TPL has existing terminals at West Melbourne comprising a total of 55,620m3 of storage across 75 tanks; Port Botany, Sydney with 86,657m3 of storage capacity and 72 tanks; Osborne, Adelaide with total storage for 14,583m3 across 26 tanks; and Corio, Geelong with aggregate storage capacity of 76,951m3 and 26 tanks. In addition to a range of petroleum, ground and aviation fuels, TPL manages various chemicals, liquefied gases, biofuels, tallows and vegoils products at its terminals.

TPL’s Tumblety says occupancy rates have been high at the company’s facilities over the past few years with all sites recording occupancy of over 90%. Throughput volumes have grown dramatically as the company has brought long-term bitumen, aviation petrol and diesel storages online at its four facilities. Since 2008, TPL’s throughput has doubled and is now around 1.14 million tonnes/year. By the end of 2015, Tumblety expects it to be close to the 2 million tonnes/year mark.

TPL’s new import terminal, under development at Outer Harbour in Adelaide, is now scheduled to be fully operational in mid-2014. The facility is being built with an initial 85 million litres of storage capacity comprising 30 million litres for diesel, 40 million litres for unleaded petrol, 13 million litres for premium unleaded petrol, 2 million litres for ethanol and 200,000 litres for biodiesel. On completion,

55

australia the new facilities will almost double South Australia’s fuel storage capacity.

‘The entire initial capacity being built is for Caltex, but the site has space and provision for further stages to be built should they be required to meet growing market demand and demand from the mining industry,’ Tumblety explains.

TPL and Caltex Australia have a long-term leasing agreement in place for the full 85 million litres capacity.

Caltex’s current fuel capacity at the Birkenhead terminal in Adelaide is limited by available tank capacity, berth draught and congestion at the existing Inner Harbour berth due to

Vopak currently is adding a 21,000m3 bitumen import facility at its Sydney Site B terminal occupancy levels rapidly approaching their upper limits.

Tumblety says TPL has plans to build a new 150 million litre fuel terminal at its Geelong site adjacent to the Shell refinery.

‘As per Adelaide, we have a view that Geelong will become a major gateway for fuels into Victoria with the expected continuation of refinery rationalisations and the need for large import facilities,’ he explains, adding that the design and planning process on this facility is underway.

The initial capacity will be offered to the market in general, once TPL has certainty on the planning permits and costings, which the company expects to

56

secure by this summer.

In addition to the plans for Geelong, Tumblety says TPL is ‘well advanced at two other major Australian cities on the east coast in acquiring land for new builds of fuel terminals’.

TPL is owned by ANZ Terminals Pty, which also owns and operates four terminals in New Zealand through Bulk Storage Terminals.

Vopak adds bitumen unit Vopak Terminal Australia owns and operates three terminals, one in Darwin and two at Botany Bay, Sydney, with a combined storage capacity of 557,976m3. The Darwin terminal has storage for 173,583m3 across 30 tanks and handles petroleum products, chemicals, vegoils and biodiesel. It is available for lease to all importers.

The Northern Territory is the only Australian state where no petroleum refiner-marketer has its own major import terminal.

The company’s two terminals at Port Botany have a combined capacity of 384,393m3. The larger of the two facilities, with 349,548m3 of storage across 26 tanks, handles petroleum products, biodiesel, ethanol and blending components. The smaller facility can store petroleum products, oleochemicals, chemicals, biodiesel, vegoils and base oils.

Vopak says most of the capacity at its three terminals is leased out under long-term contracts, with average occupancy rates across the terminals at 89.5% in 2012.

‘There has definitely been a slowdown in the mining sector and only modest growth across the Australian economy as a whole,’ says Leo Brons, MD of Vopak Terminals

Australia. ‘Diesel, premium grade petrol and jet fuel are the grades which are seeing the most growth. ULP has been static and likely to decline slightly over coming years.’

Vopak currently is adding a 21,000m3 bitumen import facility at its Sydney Site B terminal, The facility will comprise three tanks and a two bay gantry for loading trucks and is expected to be commissioned in the fourth quarter of this year.

Shell Australia, which is among current lessees at Vopak’s existing Port Botany’s facilities, signed a leasing agreement for the new unit in July 2012.

Shell Australia says the new facility will allow it to import and upgrade hot bitumen to supply the New South Wales (NSW) market, replacing production at its Clyde refinery.

The bitumen import facility is currently Vopak’s only expansion project in Australia but Brons says the company is always keen to explore expansion opportunities.

In early 2010, the company lost out in its attempt to expand into the Perth, Western Australia market, via a proposed acquisition of Gull Petroleum’s Kwinana terminal, the largest multi-purposed bulk liquid dangerous goods terminal in Western Australia. Vopak was outbid by Kwinanaheadquartered Coogee Chemicals, a producer of industrial, agricultural and mineral processing products and bulk liquids terminal operator. Coogee paid a reported A$40 million (€28 million) for the Kwinana terminal, which today has more than 153,000m3 of storage capacity.

Stolthaven greenfield plans Stolt-Nielsen first entered the Australia bulk liquids sector in October 2011, with the acquisition of a majority stake in Marstel Terminals Pty, a privately held network of nine bulk liquid storage facilities in Australia and New Zealand with a total combined storage capacity

of approximately 177,000m3.

Stolt-Nielsen owns 70% of the business, which was renamed Stolthaven Australasia Pty. The remaining 30% of the equity is held by Marstel’s founders, Graham and Anne Catley.

Stolthaven’s four Australian terminals include the Coode Island facility in West Melbourne which has 27,500m3 of storage across 11 tanks, and handles petroleum products, chemicals and vegoils. The Port Alma facility, located 50km south east of Rockhampton in Queensland, provides petroleum product storage to both independent fuel importers and mining companies. It has 22,900m3 capacity across three tanks. Stolthaven’s 31,100m3 Bundaberg terminal, also in Queensland has in the past operated as a petroleum and diesel storage facility but is currently decommissioned. The company also owns an inland terminal with 4,600m3 of storage at the Altona Petrochemical Complex in Altona, Victoria.

Stolthaven is developing a new greenfield fuel storage and import terminal at Newcastle, NSW, a project initiated by Marstel. The project was originally planned to have an initial capacity of three tanks with an aggregate 54,000m3 for diesel storage and a 3,000m3 biodiesel storage tank. The scope has recently been expanded for the addition of two further tanks of 18,000m3 each for diesel storage and a second biodiesel tank of 4,200m3.

The additional facilities would raise throughput capability at the terminal to a total combined permitted annual throughput of 400 million litres.

Fuel volumes required to service the market in the Newcastle and Hunter Valley region currently are predominantly met by pipeline transfers and road trucks from Sydney. The fuels are first imported into Sydney before further transfer to Newcastle.

The increased storage capacity proposed will allow

July/August 2013 • TANK STORAGE

australia

Vopak Terminal Australia owns and operates three terminals, one in Darwin and two at Botany Bay, Sydney, with a combined storage capacity of 557,976m3 additional volumes of diesel fuels to be imported directly to Newcastle, according to the Environmental Assessment (EA) report prepared by AECOM Australia Pty on behalf of Stolthaven for the proposed project modification. Existing and proposed urban and industrial activity throughout the Hunter Region has increased the demand for fuel, thus improved accessibility to biofuels is significant to the sustainable growth of the region, notes the EA document.

Marstel reached an agreement with Shell Australia in early 2011 for the oil major’s use of the new diesel import facilities at Newcastle, when completed.

New entrants Australia’s growing fuels import market has led to a good deal of international interest in potential acquisitions in the country’s refined petroleum products sector. Switzerlandbased Puma Energy, a majority-owned unit of Dutch trading house Trafigura Beheer BV, earlier this year became Australia’s largest independent fuel retailer following three acquisition deals in as many months. Ownership, or access to, an import terminal was a key factor in two of these deals.

Puma Energy completed the acquisition of independent fuel marketer Neumann Petroleum and energy distribution group Ausfuel in March, after announcing it had reached agreements to buy the two companies in January and early February,

respectively. The deals mark Puma’s first investments in Australia but not for Trafigura.

A wholly owned subsidiary of Trafigura, Trafigura Fuels Australia Pty, purchased the 77,000m3 Hastings petroleum bulk storage terminal in Western Port Bay near Melbourne from Vopak Terminals Australia in 2001, before selling the facility to Australian petroleum independent United Petroleum in December 2007.

In late February this year, Puma Energy also announced a deal to buy central Queensland’s largest independent fuel marketer, Central Combined Group (CCG). The price tags of the three Puma deals have not been disclosed.

In addition to more than 120 service stations in Queensland and NSW, Neumann Petroleum’s assets include a coastal import terminal at Eagle Farm in Brisbane. The import facility, which Neumann bought for a reported A$18 million in 2001, was said to be a key element in the deal with Puma. Control of, or access to, an import terminal obviously is vital for any new player coming into the Australian market.

Puma Energy Australia’s GM Ray Taylor says Puma had been planning its entry and growth into the Australian market for several years.

‘The shift in market dynamics made strong independent fuel businesses like Ausfuel and Neumann the perfect partners to leverage Puma Energy’s global connection and import supply,’ he said

TANK STORAGE • July/August 2013

in a recent press statement.

Puma says it is committing ‘significant’ funds to develop Neumann Petroleum’s Australian businesses. As part of the Neumann business, Puma plans to develop a new petroleum import terminal at the Port of Mackay in Queensland. The new facility will be built with an initial 57,000m3 of storage. Puma has declined to comment on the timescale of the project but says it expects to build more terminals in Australia as the country boosts its reliance on fuel imports.

The Ausfuel acquisition [from Archer Capital and minority shareholders] extends Puma Energy’s geographical reach to Western Australia, the Northern Territory and South Australia, while adding to its reach in regional Queensland.

Adding CCG to the Puma portfolio will increase Puma Energy’s exposure to the growing mining industry fuel market in regional Queensland as well as increase its national service station footprint.

Since December 2012, Angola national oil company Sonangol has held a 20% stake in Puma Energy.

Japanese Idemitsu Kosan has also been attracted to the Australian fuel import market, completing the acquisition in December 2012 of a 100% stake in independent Australian oil product distributor, Freedom Energy Holdings Pty. Idemitsu Kosan described the move as part of its goal to expand its business in growing overseas markets. Brisbane-based Freedom Energy sells around 650 million litres/year of petrol and diesel oil using an import terminal at Brisbane and operates 40 retail stations on Australia’s east coast.

Oil majors invest Even after refinery closures, the oil majors are not likely to give up easily their share of the country’s fuel market. All four oil majors with a presence in Australia – Shell, Caltex, BP and

Mobil – are actively adding to their import infrastructure, either directly or via longterm leasing arrangements.

Caltex Australia, which supplies over a third of all transport fuels in Australia, has said the company remains committed to supplying the market despite the move to close the Kurnell refinery towards the end of 2014. Like Shell’s plans for the closed Clyde refinery, Caltex intends to convert the refinery to an import terminal. Caltex has said it has agreed a long-term supply deal with 50% shareholder Chevron for transport fuels at ‘market-based prices’.

As noted earlier, Shell Australia has put up for sale its last remaining operational refinery in Australia. The company says the proposed sale of the Corio refinery ‘underpins the company’s local strategy to grow its retail and bulk fuels business, along with terminals and pipelines.’ If a sale with agreeable terms and conditions cannot be reached, Shell Australia says other options could include converting the site to an import terminal.

The company says it is now operating the Clyde site in Sydney as an import terminal based on existing infrastructure following the closure of the refinery in late September last year. The site has been previously operated in terminal mode for an extended period in 2009.

Shell Australia has plans to convert the refinery and the Gore Bay terminal into a dedicated fuel import facility.

A Shell Australia spokesperson says the company is currently working on the design of the new import facility but he could not provide any further details, including the expected project timeframe Nevertheless, with further refinery closures likely, Australia’s growing reliance on imports to meet its fuel requirements looks set to provide some interesting opportunities for independent terminal operators.

57

finance

Playing the long game Private equity firm First Reserve is perhaps best known among our readers for its involvement in the Bahamas Oil Refining oil storage terminal (BORCO).

First Reserve and Vopak acquired the terminal in the Bahamas in 2008 in an 80/20 strategic joint venture and First Reserve then sold its 80% equity interest to Buckeye for $1.36 billion (€1 billion) in 2011.

What is not as widely known, however, is that First Reserve has seven other active infrastructure projects including contracted midstream infrastructure assets Caliber Midstream Partners, First Carribean Power and Midstream and First ECA Midstream.

First Reserve is this year celebrating its 30 year anniversary.

The firm invests exclusively in energy via Buyout and Infrastructure Funds and its infrastructure investments focus on contracted power, contracted midstream, contracted energy equipment and regulated transmission and distribution assets. As such, Eduard Ruijs, a director in the infrastructure investment team, is well placed to talk about the continued appeal of oil storage facilities.

‘Oil storage facilities tend to benefit from stable,

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Eduard Ruijs, director at First Reserve, explains what he looks for in a terminal investment partnership long-term contracts with high creditworthy customers and are generally not exposed to any commodity price exposure,’ Ruijs explains. ‘Even in more challenging economic times, those storage facilities which are based in strategic locations have remained resilient as opposed to those in more peripheral locations.’

‘The industry has had five notable investments over the past 12 months and we expect continued activity throughout this year,’ he adds.

Sinopec’s investment into Vesta in October 2012, for example, was at an EBITDA multiple of 11.4 and EQT acquired Westway at an EBITDA multiple of 6.8 – still robust valuations.

The three others are: Lindsay Goldberg’s stake in Odfjell, HES Beheer’s increased stake in BTT, and the LBC acquisition

by APG and PGGM. Understandably, Ruijs predicts there will be fewer new builds in mature markets such as around the ARA region, but sees continued investments in emerging markets such

as Brazil and Asia.

As for the much talked about Fujairah, Ruijs finds it unlikely the port will ever match the likes of Singapore, Rotterdam and Houston.

‘There is a significant amount of growth of new capacity there, but the traders aren’t based there, and the port doesn’t have the size of some of its competitors,’ he explains.

First Eduard Ruijs Reserve’s buyout investments are typically around five to seven years, and aim to achieve significant capital appreciation within that period. However the infrastructure investments made by the First Reserve’s energy infrastructure team are targeting longer term 10 to 15 year partnerships, during which the fund is mostly focused on cash yield generation.

This means the valuation of projects in which it invests are less dependent on the terminal value of an asset at the end of an expected hold period, but more driven by the dividends yielded over time.

‘The EQT investment in Westway can be considered as a hybrid private equity infrastructure investment,’ he explains. ‘The investor will target capital appreciation over a shorter period of time, as well as try to establish a stable dividend yield for the underlying business as a

July/August 2013 • TANK STORAGE

finance result of its interventions.’

What do investors look for?

‘The most attractive asset a terminal can have is longterm contracts with credit worthy customers,’ Ruijs says.

‘Assets also need flexibility. If a terminal can adjust to deal with different product mixes without a huge amount of investment, this is also beneficial when capacity that frees up needs to be re-contracted over time.

‘In the past terminal operators were willing to take a leap of faith when developing new terminal projects. But in today’s market they are only looking to develop such projects if firm anchor tenants have been contracted before construction to allow for recovery of the capital expenditures involved.’

However, despite investors being more cautious, Ruijs does not expect to see a slowdown in M&A activity: ‘Financial

An exception to the rule?

This May Odfjell announced that it signed final transaction agreements with Lindsay Goldberg.

As part of the transaction the private equity firm will acquire a 49% interest in Odfjell Terminals A.S. (OTAS), the holding company for substantially all of Odfjell’s tank terminals activities.

Lindsay Goldberg first partnered with the terminal back in 2011. However in Q4 2012 Odfjell reported a net loss of $40 million, compared with a net loss of $8 million in the corresponding quarter of 2011 on revenues of $296 million, down from $322 million one year earlier. The company recorded quarterly operating losses of $23 million, compared with a $1 million operating loss in the fourth quarter of 2011, and a decline in EBITDA to $17 million, from $31

markets have become more liquid now and some private equity firms that invested in terminals six or seven years ago may well be looking to divest certain operations in the

million a year earlier. According to OTAS, the results reflected ‘a continuing weak chemical tanker market and significant losses at Odfjell Terminals Rotterdam (OTR)’.

OTR was shut down in July 2012 for breaching safety standards, an incident that resulted in the loss of a storage contract with Shell after improvements were not made in good time. The Rotterdam tank terminal delivered negative EBITDA of $9.8 million in Q4 and negative EBITDA of $20 million in Q3.

Proceeds from this latest transaction will partly be used to fund the investment and recovery and improvement plan at OTR. Based on year end 2012 financials, the transaction values Odfjell’s tank terminals business outside of the existing joint venture at approximately 10x EBITDA.

near term to realise an exit.’

Ruijs highlights southern Europe as a place where investment opportunities may appear over the coming years. ‘Shareholders may

be looking to reduce their exposure to more risky markets hit by the economic crisis, which in turn may create new investment opportunities for other investors,’ he adds.

Storage Tank Design & Construct Turn key projects

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Maintenance

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TANK STORAGE • July/August 2013

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59

construction

Hats off to Vopak’s terminal in Laurenshaven

‘Tank 2001’ is the technical name of this beautiful hand painted tank. The people working in the Rotterdam Botlek area call this famous storage tank the ‘Top Hat box’. It was painted by three Dutch artists for Pakhoed (‘hoed’ meaning ‘hat’ in Dutch). Pakhoed and Van Ommeren were the two merger partners from which Vopak originated in 1999.

This tank has a special construction.

The steel roof has a 58m diameter, a height of 23.2m and is supported by columns.

This type of lightweight construction was regularly used in the past as it enabled

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a quick building process. At that time, future maintenance costs were not really a key driver in the design process.

Vopak has asked maintenance specialist Mercon to refurbish Tank 2001. As well as general maintenance, the bottom of the tank also needs to be replaced.

This is quite a challenge as the columns that support the roof are fixed onto the bottom plates. They need to be carefully loosened and then jacked up 10cm so the bottom plates can be removed and new ones installed. The whole operation has to be done in a controlled manner.

The tank pit will be renovated and a high-density polyethylene (HDPE) layer will be put underneath the new bottom.

Furthermore all internal piping and pressure vacuum valves have to be demounted

by Mercon and will be revised.

Safety is always the number one priority during maintenance. Activities such as welding and gouging cause sparks and, although this is nothing new, it is more important than ever to ensure sparks do not set catch fire to residue left behind in the hollow columns that support the roof.

July/August 2013 • TANK STORAGE

corrosion

Independent storage terminal operator Oiltanking operates 75 terminals in 23 countries with a total capacity of 20.3 million m3 (127.68 million barrels). Aboveground storage tanks are the lifeblood of its terminals so maintaining these assets is critical.

Tank bottoms are the biggest problem area for corrosion. In the last four years, the combined bottom repair cost for Oiltanking’s terminals due to corrosion was approximately $10 million (€7.7 million). Financial loss can be significant when this type of corrosion takes place. Over a period of eight years, one of its terminals,

for example, reported a loss of $1.8 million due to underside corrosion alone.

Storage tank bottoms are continuously threatened by corrosive products and moisture present in the environment. Bottom corrosion occurs when there is a chemical or electrochemical reaction between the bottom plate and its environment, producing a deterioration of the bottom material and its properties.

Storage tank bottom corrosion can occur in two ways. Firstly, internal corrosion, caused by the following: • Product itself. Usually

• •

• •

occurs when a product with a very low pH (acidic) is stored in CS tanks Water separated from the product Water collected in the hollows of tank bottom floor Microbial Products with high sulphur content.

Secondly, external corrosion (underside corrosion), caused by the following: • Moisture ingress under the tank floors • Chloride inclusion will accelerate the corrosion • When located near the sea, the exposure to

a saline environment increases the problem • Also untreated industrial and fugitive emissions in the atmosphere stimulate the corrosion • Use of sea water for testing of sprinkler system (should be avoided).

Remedies for internal corrosion are regular inspections, internal coatings in the bottom plate and first shell course, including a corrosion allowance (CA), installation of a double bottom, avoiding hollow pockets in the bottom plate during construction, regular water draw off and ensuring the tank is cleaned

A concrete ringwall with back fill

TANK STORAGE • July/August 2013

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corrosion when products are changed.

Adding a CA is one of the easiest and most costeffective ways of adding life to a tank. On a 150ft. tank, if the common CA of 1/16” is used, the additional cost is estimated to be $40,000. The life of the tank can be extended by 10 to 20 years depending on the factors of the tank and product. This is less than 2% of the total tank cost.

One example of a double bottomed tank used at one of Oiltanking’s terminals in Germany showed no evidence of corrosion even after 20 years of installation.

This principle employs the use of a second steel bottom plate fixed on top of the bottom plate with an approximate gap of 12mm. A steel mesh (6mm thick) is placed in between these two plates before welding the top plate.

Two DN 25 nozzles will be connected from the shell external to this interstitial space. One nozzle will be connected to a vacuum pump to create a vacuum in the interstitial space and a vacuum gauge will be

connected to the other nozzle for monitoring. Thus, corrosion will be prevented by removing all the air from the interstitial space and continuous monitoring can be done. In addition to this method, other double bottom principles such as sand and concrete can be used. However, the choice of these types of materials is vital to its success so as to avoid inducing corrosion.

External corrosion Remedies for external corrosion include foundation choice, cathodic protection (CP), chime coating, asphalt pad, under bottom coatings and liners, sand treatments, rain hoods and sealing of annular plate to foundation.

Foundation choice is the starting point for corrosion prevention and one of the most important. There are three main choices of foundation: earthen, concrete ringwall with backfill and concrete pad.

Each method increases with costs, respectively as do corrosion prevention.

In addition to the choice

of foundation, the backfill used is just as important, if not more. Standard masonry sand is common. Areas to inquire are as follows: • Sieve testing • pH Range 6-8 • Resistivity (greater than 500,000 ohm/cm) • Sulfide less than 1 ppm • Low to non-detect on chloride.

CP is an electrical method of preventing corrosion on metallic structures that are in electrolytes, such as soil or water. This method controls the corrosion of a metal surface by making it the cathode of an electromechanical cell.

This system uses an inert anode material that is energised by an external power source to deliver protective current to the tank bottom.

The tank bottom should maintain contact with the pad (electrolyte) for CP to work effectively. But the contact with the bottom to pad varies during fill/empty cycles. When the tank is empty, the bottom plate will ripple causing a large percentage of the steel to lose contact with the pad

material. CP does not provide effective corrosion control for those portions of the bottom.

In order to eliminate, or at least minimise, the chances of corrosion, Oiltanking uses an asphalt pad on top of a concrete ringwall with sand backfill type foundation.

The terminal has found this to be the best combination of cost-effectiveness and corrosion prevention. It uses a 2” asphalt pad that covers the foundation. This will eliminate the effectiveness of CP on the tank itself but it can, and should, still be used on the underground piping. It must be a low particulate style asphalt.

Also, the use of a chime seal to prevent water seepage is recommended between the bottom and the pad.

Terminals rely on their tanks, so corrosion prevention is vital to their survival. Regardless of what measures are taken to prevent corrosion, it is vital that during construction, the contractor keeps the plates clean and free of dirt. Good construction practices help the life of the tanks more than any of the engineered solutions offered above.

The installation of an asphalt cap/liner

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July/August 2013 • TANK STORAGE

training

PPE

To olBox Talk

Stand and deliver One specialist safety provider explains the approach it takes to teach storage terminal operators good PPE practices in just 35 minutes Who knows your terminal storage site better than you?

The typical answer is nobody.

This is why one safety provider, Reynolds Training Services, has developed a training pack that refreshes operators’ knowledge of core responsibilities, helping to prevent, control and mitigate hazards.

Delivery of the talk, known as the Personal Protective Equipment (PPE) ToolBox Talk, can be given by site members who are known to workers and competent in PPE. Like a ready-made meal, it takes 15 minutes to prepare and 20 minutes to deliver.

Delivering the talk 1. Introduction With delegates gathered around the proverbial campfire, get started by letting them know that PPE is an essential part of your

terminal storage environment.

Use of PPE is vital in providing protection to workers if other control methods fail.

During the introduction, reference any relevant procedures in relation to the use and control of PPE within your workplace.

2. Regulatory requirements Now is a good time to let the group know both employers and employees are bound by legal duties in relation to PPE. Inform them that: • Employers must provide suitable equipment unless the risk is adequately controlled by other means • An assessment is required to determine whether the PPE is suitable for the job • Equipment needs to be maintained in an efficient state and working order • Employers must provide employees with appropriate information,

TANK STORAGE • July/August 2013

instruction and training • Employees will ensure that any loss or defect is reported immediately.

PPE should be regarded as a ‘last resort’ in the hierarchy of safety control measures. As such, other means of protection should be used wherever practical. Ask the group why this is and be prepared for responses to include: • PPE only protects the person wearing it, whereas controlling the risk at the source provides protection to all personnel on the terminal storage site • PPE can create additional hazards by limiting visibility and mobility.

3. Risk assessment Now move on to the area of risk assessment. Let the group know how PPE needs are identified by taking a number of key areas into consideration. These include:

• Is the protective item appropriate for the risks identified?

• Can it be adjusted to fit the wearer?

• Will use of PPE place extra demands on the wearer?

• Is it compatible with other items of PPE Refer to the above risk assessment examples and highlight where delegates can locate information regarding PPE? 4. PPE marking Time to bring the group up to speed with the CE mark. Any item of PPE affixed with CE indicates that it conforms to all requirements imposed upon it

by European directives. It also confirms the product has been subject to the appropriate assessment procedures. In other words: it is fit for the purpose it was designed for.

Remember to ask delegates to locate the

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training relevant markings on their PPE. 5. Types of PPE Ask delegates to identify the different types of PPE available. Use your own site and equipment as a point of reference, identifying what the specific hazards might be and what PPE options they have to choose from.

7. Safety signs Time to get to grips with safety signs. Kick things off with the obvious: safety signs are round in shape, with a white picture on a blue background.

Let your audience know that they provide mandatory instructions in relation to specific behaviour. So, if a

•

Outline the ‘risks’ and see if they can name the ‘hazards’ and ‘options’: Risks

Hazards

Options

Eyes

Chemical splash, dust, projectiles, gas and vapour

Safety spectacles, goggles, faceshields and visors

Safety signs

Head

Impact from falling objects, bumping/ banging head and hair entanglement

A range of helmets and bump caps, many designed to meet specific industry needs

Breathing

Dust, vapours, gas and oxygen deficient atmospheres

Disposable filtering facepieces or respirators, half or full face respirators, air fed hood / helmets and self-contained breathing apparatus

Hands and arms

Abrasions, Gloves, gauntlets, temperature extremes, mittens, wrist-cuff cuts and punctures, and armlets impact, chemicals, electric shock, skin infection/irritation

Feet and legs

Wet, electrostatic build-up, slipping, cuts and punctures, falling objects, chemical splashes and crushing

Safety boots/shoes, wellington boots, gaiters and leggings

The body

Adverse weather, chemical splashes, dust and entanglement

Conventional or disposable overalls, boiler suits, waterproof coats or jackets and hi-vis clothing

1. Name the markings on PPE equipment confirming it has been assessed and conforms to the required standard 2. PPE is considered as the ‘last resort’ in terms of providing protection – why?

3. Other regulations have specific requirements in relation to the provision and use of PPE – provide some examples of these.

4. What must you do with your PPE when you have finished using it?

5. You damage your PPE and it cannot be repaired – what action do you take?

6. Give some examples

6. Maintenance Getting the right tools for the job is one thing, but making sure they are maintained is equally important.

Inform the delegates that maintenance is a key aspect in ensuring the continued effectiveness of PPE. Let them know it is both the responsibility of employers and employees to ensure proper storage is available, and that equipment is clean and in a satisfactory state of repair.

Cleaning can be carried out by trained workers while intricate repairs should be conducted by manufacturers.

The core message to convey here is who your operators should go to if they have an issue with their PPE.

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sign says wear a hat, wear a hat. It is simple mathematics.

8. Other regulations Rules and regulations snake through the terminal storage sector. Let delegates know there are a number of additional regulations which need to be taken into account when it comes to the provision of PPE. These regulations include: • Control of Lead at Work 2002 • Ionising Radiations 1999 • The Control of Asbestos 2006 • Control of Substances Hazardous to Health 2005 • The Control of Noise at Work 2005 9. Questions Time for a quiz. Ask the team:

You have a duty to take care of the PPE and not to abuse it. Ensure you store it appropriately • If you are unsure about how to use any PPE apparatus ask for training first • If there is anything wrong with the PPE provided e.g. worn out, broken, in need of maintenance or cleaning, report it.

11. Make a record With the session now ended and the teapot empty, make a record of those who attended.

Present this form to delegates:

of PPE that would provide protection to the eyes, arms, hands, body, legs and feet.

10. Action point summary Provide delegates with a quick recap to consolidate the PPE training session: • You have a duty to wear any PPE provided by your employer. They have a duty to see that you do • You must wear and use the PPE in the way it was intended – therefore it must fit you. If it doesn’t, report it • PPE must be suitable for the risk and the job in hand. If it’s not, report it • PPE must not itself create a new risk. If it does, report it

‘I confirm that I have attended the Toolbox Talk and have raised any questions relevant to this delivery. Should I have further questions regarding this topic then I will raise these in the first instance with my line manager.’

For more information:

Access the full, illustrated, unabridged version of this ToolBox Talk and others at www.reynoldstraining.com

July/August 2013 • TANK STORAGE

cyprus

by Nicholas Zeman

Cyprus’ crisis As Cyprus tries to mortgage its energy future, a $300 million oil terminal ramps up construction at the southern port of Vasilikos to capitalise on the island’s location Earlier this year Cyprus borrowed €10 billion to try and save the island from insolvency after bets its banks made on Greek bonds went south.

Investments were seized, accounts were frozen and the rest of the world had to step in. The money came from the EU and International Monetary Fund, but at a backbreaking 30% interest meaning nearly €13 billion has to be returned.

Developing a revitalised energy sector is crucial to that task. Energy trading

is a part of the country’s economic backbone and Cyprus has provided a home to several global oil traders and marketers over the years. This is because commodities traders look to headquarter their operations in tax break havens.

Other companies in the resources industry, such as mining and oil groups, pay on average an effective tax rate of 30 to 45%. Wall Street banks pay out 20% in taxes off their earnings and

TANK STORAGE • July/August 2013

trading hubs like Switzerland, the Netherlands, Cyprus and Singapore offer tax brackets between 5 and 15%.

‘Mercuria for example, the fourth largest independent oil trader in the world, said in its annual 2011 accounts filed in Larnaca, Cyprus that the group operations are located in jurisdictions with tax rates of 9.5 and 10%,’ The Financial Times reported in April.

Perhaps a foreshadowing of the country’s meltdown, however, was trading giant

Trafigura’s relocation of operations from Cyprus to Singapore last year, and several other companies in the sector have minimised investments and exposure to the banking sector in Cyprus prior to the crisis.

That Cyprus has been a haven for oil traders is a bit ironic considering one reason for the country’s struggles is its precarious domestic energy supply. Its only oil refinery closed in 2004 but the country consumed 67,000 barrels per day (bpd) of petroleum last year, all of which was obviously imported. The country also produces almost all of its electricity from oil, which trades at a significant premium to other feedstocks like coal and natural gas.

‘This means that an oil terminal is crucial for Cyprus to benefit from some of its own trading and create a destination for increased competition of oil products moving through Cyprus’ shores,’ states the US’ Energy Information Administration (EIA).

Some good news is that Netherlands-based Vitol, the world’s largest energy trader, sees Cyprus as the future energy hub of the Mediterranean, connecting flows between Africa, Europe and the Middle East. Already one of the world’s shipping and logistics capitals, Cyprus also has four ports among the most modern and wellequipped in the world. Vitol, and its partner MISC-Berhad of Malaysia, are building a new oil trans-shipment terminal at Vasilikos, with the first phase of development scheduled to conclude in early 2014.

The Vitol terminal is one bright spot in the country’s energy sector, providing some hope in a heavily contrasting atmosphere. ‘There is a sense of euphoria about the energy projects ongoing in Cyprus, but also a gloom for

65

cyprus the present situation,’ says Constantine Hadjistassou, an oil and gas industry analyst and a researcher at the University of Cyprus.

VTTI specs As some traders and logistics managers have minimised exposure to Cyprus, Vitol is expanding its presence and touting its role in helping the country build its energy future.

The company says the Vasilikos terminal ‘is the only major infrastructure project currently investing in Cyprus with 100% equity funds, with 500 jobs created during construction and 40 full-time jobs once operational. Further support would go toward shipping activities and, overall, the project could generate nearly €18 million in taxes annually for the local government.

Vitol and MISC Berhad and Vitol formed a partnership in 2011 to increase the tonnage and logistical power of their respective bulk freight empires.

VTTI was created from the deal, with each having a 50% stake in the subsidiary.

‘Having companies like this headquartering operations here is essential to the country’s economic recovery and bolstering the confidence of investors,’ Hadjistassou says.

‘Due to the current financial difficulties, most Cypriots base their hopes on the many energy projects under development here, the VTTI terminal being one,’ Hadjistassou continues. ‘Cyprus has the third largest fleet in terms of tonnage in the EU. We have a stable political system and a highly educated work force, and Cyprus does feel confident it can raise capital if these projects are viable.’

The viability of the VTTI terminal rests on the ability of the project to provide ship-to-ship operations in the eastern Mediterranean, as currently 250 trans-shipments per year take place in the open sea around Cyprus. In

66

2011, 9.6 million tonnes were trans-shipped. This quantity is expected to see the increase of a marine jetty, similar to the one being installed at Vasilikos.

In 2011, 17,800 ships transited the Suez canal from both directions, of which 20% were carrying petroleum products. ‘The Suezmax was the largest ship capable of navigating through the Suez until 2010 when depth was increased to 66ft to allow over 60% of all tankers to use the canal, including ships that are 220,000 of dead weight tonnes in size,’ Vitol states.

This traffic is what Cyprus hopes to accommodate with the new Vitol oil terminal.

‘Our strategic reserves can be used for passing ships and used to supply nearby countries,’ Solon Kassinis, executive VP of Cyprus National Hydrocarbons, said in an interview in April.

Four berths handling all oil products, with loading arms capable handling 1250m³/h per product, will share infrastructure with other energy developments in the area and can achieve economies of scale from sharing Vasiliko port facilities and services with others. ‘Our president has expressed the intention to turn Cyprus into a regional centre for oil, so the Vitol terminal is very important,’ adds Kassinis.

Security of supply Vitol believes establishment of a world class oil terminal will solve the issue of product stockpiles. It will also provide economic benefits as Cyprus’ energy consumption depends almost fully on imported refined oil products, making the country one of the most vulnerable in the EU in terms of security of energy supply.

‘Cyprus imports all of its oil as we have no indigenous refining or mining at present.

The new oil terminal at Vasilikos will provide security of supply. We hope to have jetties in the water by this

time next year,’ Kassinis says.

This is the beginning of a larger effort to transform Cyprus into a regional energy hub, a plan that includes the construction of a liquefied natural gas (LNG) manufacturing facility and terminal at Vasilikos to process feedstock from the country’s offshore territory. If completed, the LNG facilities, which Total SA (France) and Noble (US) have made financial commitments to, could also incorporate natural gas from elsewhere in the eastern Mediterranean for processing and distribution.

The US EIA says, as of January 2013, Cyprus did not have proven reserves of oil or natural gas. ‘However, a recent offshore discovery of natural gas resources, with additional exploration on the horizon, has the potential to alter the island nation’s energy sector,’ it says. ‘Cyprus has substantial offshore acreage in the Levant Basin, estimated by the US Geological Survey to contain mean recoverable resources of 1.7 billion barrels of oil and 122 trillion cubic feet (Tcf) of natural gas.’

This could make a huge difference and turn the country into a net energy exporter very quickly. But for now, Cyprus’ lack of indigenous supply means that is extremely susceptible to price volatility in energy markets.

A European Commission report, Member States’ Energy Dependence: An indicatorbased assessment, states the share in gross inland energy consumption in Cyprus is the second highest in the EU. The share of oil in the energy mix was 95% in 2010, only improving one point since 2006.

‘Cyprus can be characterised as the most vulnerable country in terms of the external dimension of energy dependency because it had the second largest energy trade and current account deficit in 2011,’ the report read.

The EU Commission says the energy trade deficit increase between 2007 and 2011 illustrated Cyprus’ vulnerability to potential macroeconomic imbalances.

Kassinis believes the Vitol oil terminal ‘will provide a security of supply that Cyprus has not had before’.

The EC report further stated Cyprus has been victim to some of the highest electricity cost increases in recent years, which were between a range of 20 and 30% range, largely from the high cost associated with importing petroleum products.

The EC adds about 42% of imported oil products go to electricity generation and another 42% goes to transport, including bunkers for international maritime and aviation transport. The completion of the VTTI terminal will alleviate some of this pressure almost immediately.

‘There are already plans to add bunkers to the Vasilikos oil terminal,’ Kassinis adds.

As the effort starts to payback an interest heavy loan, Cyprus is desperately seeking bidders and negotiating deals to develop its untapped resources and act quickly to generate returns from its energy future.

The country extended its bidding for off-shore exploration rights, has secured a deal with Vopak to build an additional oil terminal at Vasilikos and is vigorously pursuing the construction of the massive LNG processing facility and storage terminal.

In the short-term though, trans-shipment of oil products from the VTTI terminal to international markets in the Middle East and Europe could be the start of transforming Cyprus into a strategic energy hub and provide storage options for the inland market and strategic stocks. This ultimately boosts confidence for foreign investors and commercial activities in Cyprus, Hadjistassou says.

July/August 2013 • TANK STORAGE

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July/August 2013 • TANK STORAGE

automation biofuels

A mate for life

This year has so far been a time of change for Emerson Process Management. In January the company announced the appointment of its new president for Europe, Roel van Doren, and has recently moved into new offices, still headquartered in Baar, Switzerland.

Addressing a number of industry players during a recent visit to the new Baar HQ, van Doren said: ‘Over the years we have evolved from a group of companies to one coherent block. Our new offices symbolise how we have evolved.’

Emerson has opened six new service centres and three new education centres in the last 12 months as part of the company’s ongoing global support service initiative, which also includes expanding and upgrading many of its existing facilities. Centres have opened in Germany, the Netherlands, Spain, Hungary and Kazakhstan.

One company that is benefitting from Emerson’s growing support network is Vopak, the world’s largest independent bulk liquids storage operator. In 2012 the two companies announced the signing of a three-year global framework agreement for terminal automation systems.

Under the contract, Emerson is to install its DeltaV automation solution throughout Vopak’s 84 tank terminals worldwide. This overhaul is expected to help Vopak meet growing demand for reliable liquid oil, gas and chemical storage and terminal services – demand driven by increasing global energy usage and geographical imbalances between production and consumption.

TANK STORAGE • July/August 2013

Vopak’s CIO Ton van Dijk speaks about the company’s implementation of a new automation system across its 84 terminal locations Implementing Emerson’s DeltaV system and integrating it with additional terminal logistic and safety systems will help Vopak optimise operations, reduce field work and time-consuming paperwork, and improve terminal effectiveness and customer satisfaction.

Speaking about the events that took place prior to this agreement, Vopak’s chief information officer Ton van Dijk said: ‘We want to offer better services and solutions to our customers.

The market is asking for more flexible solutions, for shorter time to market, higher safety standards, and more efficient and faster operations. Additionally, all of our customers are asking for more and better information about things that we do in the supply chain.’

After much consideration Vopak chose two suppliers for process control and production execution, which van Dijk refers to as ‘level 2 and level 3 of the playing field’, respectively. They are Emerson and Yokogawa. We did not want a sole supplier for level 2 or level 3,’ he explained. ‘We always have a dual strategy to make sure that we have options. We don’t want to be tied to one company as strategically that would not be a wise thing to do.’

Nevertheless, one of the reasons why Vopak selected Emerson as one of its suppliers was its willingness and ability to invest. ‘What kind of vision does a company have? Are they willing to invest in the products that you are taking from them and how much are they willing to invest? And, importantly, what’s their view of the tank terminal business? We’re in a pretty niche market and, in that, we are a leading player.’

In order to stay ahead of the game Vopak wanted to create a new digital automation system with its partner. ‘We asked Emerson if they would be willing to spend time and money developing a solution if we invested our time and efforts providing them with the knowledge to build that software.’

Emerson agreed and the good news kept on coming. ‘We soon discovered that both companies had a shared mind set, which you don’t know upfront,’ van Dijk commented. ‘You have to start working together and then you find out a number of things about each other. This shared value was the drive to succeed.’

So far the solution has been rolled out at two out of the 84 terminal locations.

‘We still have some work to do; we need to speed up and there is still room for improvement,’ van Dijk acknowledged.

‘But it is definitely delivering what we expect from it. Our operations are safer and there has been a significant improvement in efficiency. In general, on the site that we are operating right now, we are running at 20% efficiency but we think this can go up to 40%.

That is a significant improvement.’

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valves

Get pulled in by magnet-drive pumps This leakage-free alternative cuts emissions and reduces maintenance requirements

Due to their leakage-free sealing, centrifugal pumps with magnetic drive conquer a growing share of the centrifugal pump market.

This pump design fulfils the increasing requirements to reduce emissions and, moreover, the pump requires less maintenance compared to shaft-sealed pump designs with a mechanical seal or gland packing.

Magnet drive pumps are no longer just limited to mean pressures, temperatures or pumping capacities. System pressures of up to 400bar, temperatures of up to 450°C and power of up to 450kW are now manageable with magnet drive pumps.

Functional principle and structure A magnet drive pump is the combination of any hydraulic pump with a magnet drive.

The magnet drive adopts the function of the sealing replacing the face seal or gland packing. By renouncing a mechanical shaft seal, the magnet drive pump ensures leakage-free operation.

Multistage centrifugal pumps, multistage side channel pumps, submerged pumps and positive displacement pumps can also be equipped with magnet drives.

The magnet drive consists of an external rotor connected to the drive shaft and an internal rotor connected to the pump shaft. The magnet rotors are equipped with permanent magnets; usually, the magnet

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Magnet drive pumps for high-pressure applications

A single-stage magnet drive pump material is samarium cobalt (SmCo). The isolation shell, which provides the system with leakage-free sealing, is situated between the rotors.

Power transfer occurs without slippage via the rotors’ magnetic lines of force. The isolation shell is predominantly made of metallic material; it must not be magnetisable and must provide the highest possible electric resistance.

When the drive is operated, the isolation shell represents an electric conductor in a magnetic field. Depending on the specific electric resistance of the isolation shell material, the induction in the rotating magnetic field causes eddy currents to be generated in the isolation shell resulting in heat production.

Mainly Hastelloy C (2.4610) is used as isolation shell material.

This material combines corrosion resistance with strength and thus provides higher electrical

resistance than austenitic stainless steels. This means the eddy current losses in isolation shells made of 2.4610 are lower than the losses occurring if, for example, 1.4571 with same wall thickness is used as isolation shell material. The isolation shells for standard pumps according to DIN EN ISO 15783 Sealless rotodynamic pumps class II – Requirements are designed according the standard specifications for PN 16 at 250°C. The transmissible torque of magnet drives depends on the diameter and the axial length of the drive and is theoretically unlimited. Drives with a transmissible torque of 3,000 Nm are being used. This means a pump capacity of 450kW at 14501/min. When using magnet drives in stirring units, higher torques are possible due to the usually lower speed; drives with torques of up to 4,500 Nm have already been realised.

With high system pressures in particular the isolation shell requires careful design. The isolation shell as a static seal is situated between the two magnetic rotors, which are equipped with permanent magnets. The smaller the distance between the magnetic rotors, the higher the transfer power of the magnet drive. Thus, the wall thickness of the isolation shell should be as small as possible.

The single-stage high pressure magnet drive pumps (pictured) are equipped with isolation shells made of alloyed titanium (3.7165), which are either manufactured as a welded structure or completely in one piece for particularly demanding applications.

Pumps with these isolation shells are capable of coping with system pressures of 400bar.

Apart from high strength and corrosion resistance, the 3.7165 material has another advantage: the specific electrical resistance is higher by a factor of about 1.4 compared to the Hastelloys (2.4610) usually used. This correspondingly reduces the loss caused by eddy currents in the isolation shell.

Magnet drive pumps for high temperatures The application of magnet drive pumps at high temperatures is often limited by the magnetic materials.

Samarium cobalt (SmCO)

July/August 2013 • TANK STORAGE

valves

High-pressure magnet drive pump materials can be used at up to 250°C without any restrictions.

Beyond these temperatures, reductions in the transmission capacity are to be expected.

Currently, the maximum operating temperature of SmCO magnets is about 400°C, however, from 300°C onwards special temperaturestabilised materials are used.

In high-temperature applications with a product temperature of over 400°C, aluminium-nickel-cobalt (AlNiCo) magnets are used.

The high-temperature pumps with AlNiCo-magnets can be used at up to 450°C without restrictions. Expensive external cooling of the pumps is not necessary. The disadvantage of the AlNiCo-magnet drives is the relatively large mounting space they require in the pump.

With the same capacity, an AlNiCo-drive is about four times larger than a SmCo-drive.

Magnet drive pumps for high capacities Special pumps exist with capacities that exceed the range of the chemical standard type pump according to DIN EN ISO 2858. At 1480 rpm, the operating range of these pumps reaches a pumping capacity of up to 3,000m³/h (pressure port diameter 350mm) and a delivery head of 80m (impeller diameter 500mm).

The magnet drives of these pumps can transfer a pump output of up to 450kW.

pump housings (12) are consistently calculated for an internal pressure of at least 40bar and equipped with a drain connection (1).

The silicon-carbide journal bearing is designed for the accommodation of axial forces in both directions, the bushings are secured against torsion (2, 3).

Exchangeable wear rings are High-temperature magnet drive pump arranged both in the housing and Magnet drive pumps on the impeller (4). The static in refineries sealing of the isolation shell towards the housing is arranged The use of magnet drive pumps in the force shunt (5). Wear for refinery applications is often zones protect the isolation shell based on the pump design against damages from the according to the APIStandard API685 Sealless Centrifugal Pumps for Petroleum, Heavy Duty Chemical, and Gas Industry Services. The requirements, according to API685, exceed the demands on the chemical standard type pumps according to DIN EN ISO 15783 in many aspects.

The most important requirements regarding the technical design of these pumps are shown in the cross-section.

Magnet drive pump according to API685 The centrally mounted

TANK STORAGE • July/August 2013

internal magnet carrier and/or the external magnet drive (6, 7).

In the area of the wear zones, the gap between bearing bush and magnet carrier on the inside and between the magnet drive and the lantern piece on the outside is smaller than the gap of the magnet carrier and/or drive towards the isolation shell. After a failure of the rolling or journal bearing, the rotating magnet carriers will therefore first get into contact with the wear zones and thus not damage the isolation shell.

Furthermore, the external wear zone protects the isolation shell from damages during assembly and dismantling through the external magnet drive.

The holes for the guidance of the flush flows for cooling and lubrication of magnet drive and journal bearing are designed in a way that, over the entire operating range, the pressure in the flush flows is above the suction pressure of the pump (8). This avoids evaporation in the flush flow. Due to the cooling fins, the thermal barrier between the lantern piece and the bearing carrier provides for good heat dissipation to the outside and impedes the heat flow from the pump to the rolling bearings in the bearing support (9). This measure reduces the temperature at the oil lubricated rolling bearings (10) by up to 25°C and thus increases the bearing life.

An essential requirement

71

valves of the API 685 is the secondary sealing. In order to fulfil this requirement, a double-shell isolation shell can be used (1).

These are two isolation shells arranged one inside the other, each designed for operating pressure, plus the safety margins required by the API685. Between the two isolation shells, there is a volume with a pressure being monitored by a manometer or the like. The setting of a vacuum during manufacturing is advisable. This enables the monitoring of the isolation shell state via the pressure measurement. If the pressure increases to ambient pressure, the external shell is damaged.

If the pressure is higher than the ambient pressure, a damage of the inner shell is to be assumed.

Magnet drive pump with plastic isolation shell of the plastic isolation shells was basically due to the low E-module of the materials. Under internal pressure, inadmissibly large extensions occur above 16bar. In particular the radial extension is to be regarded as critical, since the air gap

The use of ceramic isolation shells requires a construction adapted to the properties of ceramics, in particular in the area where ceramics is linked to metal components.

Stress peaks need to be avoided and the influence of

using modern finite element methods for the calculation of the stress state under pressure load and thermal stress.

During the development from metallic to non-metallic isolation shells however, the safety of the system must not

Energy savings Due to the induction in the magnetic field, eddy currents occur in metallic isolation shells.

The eddy currents and the associated energy losses can be avoided using non-metallic isolation shell materials. The following example illustrates the savings potential: the efficiencies of conventional magnet drives are between 90% and 97%. For a pump size frequently used in the chemical industry with a pump capacity of 10kW at 29001/ min, the magnet drive can be expected to have an efficiency of 90%, i.e. about 1kW gets lost in the magnet drive. Assuming 24 hour operation for such a pump, it results in a savings potential of approximately 8,800kWh per year.

Non-metallic isolation shells, above all those made of technical ceramics or plastics, have already been used for years in most different applications. However, the field of application has been limited so far by the specific features of the materials used. Today, the limits of the standard solutions are at a system pressure of 25bar, a system temperature of 250°C and a transmission capacity of the magnet drive of about 120kW at 2,9001/min.

The pressure limitation

72

Magnet drive pump with ceramic isolation shell between the two magnetic rotors needs to be small for the transmission of large torques.

These problems can be solved by further developments in the field of fibre-reinforced plastics.

different thermal expansion between metal, mainly stainless steel, and ceramics must be taken into account.

Here, the development could be driven forward by

be neglected. Here a second barrier can be used, which reliably prevents the product from leaking to the atmosphere in case of an isolation shell failure. In the simplest case, a

Magnet drive pump with ceramic isolation shell and secondary sealing in standard overall length according to DIN EN 22858

July/August 2013 • TANK STORAGE

valves high-performance radial shaft seal ring is used, which ensures there is no immediate leakage of the liquid to the atmosphere in the drive shaft area in the event of an isolation shell failure.

Measurements showed service lives of the seal ring under pressure of several hours with running shaft. The seal ring is arranged between the two anti-friction bearings with minimum space requirements so that the pump corresponds to the standard overall length according to DIN EN 22858 even with secondary sealing.

For a longer service life, a gas lubricated mechanical seal is available. The mechanical seal is designed in a way that, in unloaded state, the sliding surfaces hardly get into contact and thus the moving air in the mechanical seal chamber is sufficient for lubrication. Only in the loaded state, after an isolation shell leakage, does the mechanical seal seal against the liquid pressure.

Here, service lives of several

Magnet drive pump with gas lubricated mechanical seal as secondary sealing days can be achieved at a liquid pressure of up to 30bar.

Summary of benefits Pumps with magnet drives have ensured their place in the chemical and petrochemical industry. Particular requirements, such as high system pressures and temperatures or pump

capacities of up to 450kW, can be fulfiled by this pump design.

The main advantages of the sealless design compared to pumps with mechanical seals are the complete freedom from leaks and the low installation and maintenance expenses.

Improved efficiencies through the avoidance of eddy current losses in the isolation shell are

possible using non-metallic isolation shells. Pumps with ceramic isolation shells or those made of plastic can be used for system pressures of up to 25bar and at pump capacities of up to 120kW. For more information:

This article was written by Thomas Herbers, technical director at Klaus Union GmbH & Co. KG, Bochum



InCon InspectionConsultants

Inspection Consultants (InCon) Ltd offers:

Inspection Consultants (InCon) Ltd is a specialist NDT inspection company providing in service and out of service storage tank inspections in compliance with current codes and standards. To complement our inspection services, InCon is able to offer full engineering assessment of storage tanks to meet the guidelines laid down by EEMUA 159 and API 653 including “fitness for purpose” reports, RBI (Risk based Inspection) assessment and inspection scheduling reports.

To discuss your requirements contact: Steve Delves Tel: +44 (0) 1472 488101 Mob: +44 (0)7725 261 393 Email: stevedelves@incon.co.uk

• Storage Tank Integrity Assessment to EEMUA 159 & API 653 • Storage Tank Floor Inspection using the Floormap VS2i MFL Scanner in both Mapping and Manual mode • Storage tank shell survey using the Scorpion Dry Probe UT Crawler • Stainless Steel and Aluminium storage tank shell survey using a Dry Probe UT Scanner on extendible poles negating the requirement for scaffolding around the tank • Dye Penetrant Inspection (DPI) • Magnetic Particle Inspection (MPI) • Pipeline Integrity Inspection to API 570 • Digital Radiography of pipelines through lagging/insulation • Digital Radiography of PTFE/FRP pipelines • Phased Array Inspection of pipelines, welds, and mapping of corrosion areas • Tubular Inspection using the Olympus MultiScan MS5800 (ECT, IRIS & RFT, NFT, MFL) • Positive Material Identification (PMI) • Remote Video Inspection (RVI) • Bespoke Weld Procedures & Welder Qualifications • Mobile Radiographic Services.

Neil Edge Tel: +44 (0)151 3572212 Mob: +44 (0)7736926750 Email: neil@incon.co.uk Incon.indd 1

TANK STORAGE • July/August 2013

13/05/2013 10:04

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6th ANNUAL

page header

ABOVEGROUND STORAGE TANK CONFERENCE & TRADE SHOW

Houston, Texas | September 19, 2013

FREE TRADE SHOW

This conference is designed for engineers, managers or other individuals involved with operations, construction, environmental compliance, spill prevention and response or management activities associated with aboveground storage tanks.

NISTM

NATIONAL INSTITUTE FOR STORAGE TANK MANAGEMENT

74

www.NISTM.org | 800.827.3515 International 011.813.600.4024

July/August 2013 • TANK STORAGE

ILTA review More than 730 people attended the conference, a 10% increase over 2012. Total participation in all events was 3,920, a new record for ILTA

The 2013 Safety Excellence Award winners were: Asphalt Operating Services, Buckeye Terminals, Citgo Petroleum, Demaco, Enterprise Products Partners, Hess, Motiva Enterprises - NJ Complex, Murphy Oil, NuStar Energy, Petro-Diamond Terminal, Phillips 66, and Sunoco Logistics Partners

Keynote spea ker Cal Ripken, Jr., on e of the greatest base ball players of all time, pr ovided his unique persp ective on leadership, co mmitment and excellenc e

More than 290 companies exhibited at the 2013 ILTA Trade Show. The 2014 event will be expanded to include a portion of the adjoining exhibit hall. Approximately 60 more 10x10 booth spaces will be added, and it will have a total of 165,000 square feet

In the wake of one storm and the lead up to another...

This year’s ILTA welcomed 3,700 visitors and covered topics from lessons learnt from Hurricane Sandy to preparing for the imminent regulatory storm ‘Superstorm Sandy’ was the second-costliest hurricane in US history. Estimates assess the damage caused by the hurricane in October last year to have been over $75 billion (€58 billion), a total surpassed only by Hurricane Katrina in 2005. At least 286 people were killed along the path of the storm spanning seven countries.

So it was no surprise that such a significant event formed the basis of the opening roundtable discussion at this year’s ILTA conference in Houston.

Jack McCrossin of Citgo

Petroleum, Jim Benton from New Jersey’s Petroleum Council, Ralph Larossa from New Jersey’s Public Service Electric and Gas Company and Alice Lippert from the US Department of Energy came together to discuss lessons learnt and help the storage sector be better prepared for any future occurrences.

The first point highlighted

by McCrossin was the fact the window of opportunity to react and prepare for a storm such as Sandy is very short. This only gives terminal operators time to make basic preparations for an

TANK STORAGE • July/August 2013

approaching storm, such as removing loose debris and checking dike drains, but little time for anything else.

The additional challenge in an incident such as this is that after a storm there is a huge demand from terminals. Everyone in the local area wants fuel but, at the same time, the terminal owner has to think of the safety of its workforce.

Citgo Petroleum’s Linden Terminal in New Jersey lost all three office buildings to the storm. In addition, the marine vapour recovery unit was flooded

along with every electrical component at the site.

Four tanks even floated off their foundations. Amazingly, though, the steel pipes to those tanks stretched up to 15ft but did not break, so no product was lost. These tanks will be put back on their foundations this summer.

One unexpected challenge in the aftermath of the storm was the lack of access to the facility. As the offices were all clearly out of action, Citgo’s managers made do with a make-shift wood shed used as a command centre in

75

ILTA review order to put together an incident action plan.

Fuel waivers

speakers also advised others to engage with mechanical and electrical firms early to ensure being top of the queue.

With such a high demand for Health and safety fuel and the supply being so disrupted, the Environmental Later on in the day Peter Protection Agency (EPA) Weaver, ILTA’s director of agreed to issue certain regulatory compliance and emergency waivers to ensure safety, gave a run down of an adequate supply of fuel the impending influx of new was still available. Such regulations that are going waivers included allowing to impact the sector. The fuel to be supplied without revised programmes due to be ethanol and permitting introduced for Occupational loading without all the usual Safety and Health vapour recovery regulations.

Administration (OHSA) are a To speed up this process in particular bone of contention. the event of future disasters, New changes to the terminal operators are OSHA Hazard Communication advised to work with the EPA Standard are bringing the to dictate these emergency US into alignment with the waivers in advance.

Globally Harmonized System Getting the waterof Classification and Labeling damaged equipment repaired of Chemicals (GHS), designed was another challenge the to improve safety and health affected terminals had not protections for the US’ workers. counted on. The local service Companies are required shops were overwhelmed so 11:00 to their 190x135_Layout 1 2013/07/14 AMtrain Page 1 workers on the

new label elements and revise safety data sheet format by 1 December 2013.

This is a good example of regulations gone mad, Weaver explained. ‘You’re 20 more times more likely to die at home rather than at work, so wouldn’t the money be better spent in our homes?’

The modifications, however, are expected to prevent over 500 workplace injuries and illnesses and 43 fatalities a year and, whether you agree with them or not, they must be met. To help members ILTA will be publishing further guidelines later this year.

The worry for the terminal industry, however, is the spillover effect – increased inspections lead to additional administrative efforts. ‘The big brother effect is a bit scary, but it is where the industry is heading,’ he added.

Another bill that cannot be ignored relates to Chemical

Facility Anti-Terrorism Standards (CFATS). In April a bill was introduced in the senate that is designed to provide stronger penalties for any violations.

The Department of Homeland Security has authority to inspect facilities to enforce compliance. It can impose civil penalties up to $25,000 (€19,000) per day and shut down facilities that fail to comply with the regulations so is not something to be taken lightly.

Another issue that the ILTA has become increasing involved with this year is that of cyber security. The threat is very real and it is an issue that we expect to hear more about at next year’s event.

The 34th Annual ILTA International Operating Conference and Trade Show is scheduled for 2-4 June, 2014, and, as the exhibition is already over 80%, full rumours are that next year’s show is going to be bigger than ever.

International Summit: 2 – 3 September 2013 Interactive Workshops: 1 & 4 September 2013 The Westin Abu Dhabi Golf Resort and Spa, Abu Dhabi, UAE

Improving the operational efficiency of your tank farms and terminals Official Advisor and Distinguished Speaker: Captain Ashraf Mabrouk, Khalifah Port Harbour Master, Abu Dhabi Port Company, UAE

Exclusive presentations from : • Captain Paul Nix, General Manager, Gulf Petrochem Fujairah Oil Terminal • Yousef Al Hammadi, Head of Rotating Equipment Sub-maintenance Division, GASCO • Frederik Twiest, Deputy General Manager Operations, Gulf Petrochem Fujairah Oil Terminal • Raed Ali Mustafa Sheikh, General Manager, Cylingas • Senior Representative, ABB • Michael Harrison, Speciality Linings Technical Manager, AkzoNobel • Sahar Abdul-Karim Khattab, Mechanical Engineer (Static Equipment) ADMA-OPCO • Koshy Panicker, Oil Terminal Manager, Fujairah Port • Suprabhat Kumar Das, Manager Projects and Construction, Cylingas • Dr. Paul Rostron, Professor of Chemistry and Corrosion Petroleum Institute & Past President of NACE, Director of the CIM Center (Corrosion and Integrity Management Center, The Petroleum Institute) • Soman Pillai, Facilities Engineer, Shell • Tulasi Pillai, SHEQ Manager, VOPAK Horizon Fujairah Ltd Senior Representative, Tranton …And many more…

Benefits of attending • Determine the best practices to increase loading and storage capacity • Learn to implement technological advancements in the cleaning and maintenance of floating and fixed roof tanks • Know the best automation practices for managing endto-end tanks and terminal systems • Learn top practices in inventory and supply chain management to ensure uninterrupted supply to increasing demand • Interact and network with industry experts from leading national and international oil companies and oil & gas solution providers Associate Sponsors:

Official Publication:

Researched and Developed by:

Media Partners:

For more information or to register Tel: +971 4 364 2975 Fax: +971 4 363 1938 Email: enquiry@iqpc.ae www.tanksandterminalmanagement.com 76

July/August 2013 • TANK STORAGE

events

advert index 8 Auma

29

8 Baltic Tank

15

8 Belven

34

8 Bornemann

27

8 Borsig

67

8 Cashco

10

8 CB&I

Outside Back Cover

8 DEMA

52

8 EA Projects

21

8 Emco Wheaton

12,13

8 Endegs

28

8 Flotech PS

20

8 Franklin Valve

24

8 Hayward Baker

46

8 HMT

41

8 IMHOF

19

8 Incon

73

8 Ivens

23

8 John Zink

9

8 Klaus Union

40

8 L&J Technologies

36

8 Magnetrol

42

8 Marcus Evans

22

8 Mercon

59

8 Neda Engineering

33

8 NISTM 74 8 Noord Natie

5

8 Nordic Storage

25

8 Oreco

18

8 Protego

67

8 Roman Seliger

SEPTEMBER 2013

n 8-10th September Tank and Terminal: Operation-Ability & Integrity Management Dubai, UAE A conference providing attendees an update on current industry issues, including the latest trends, maintenance practices, new technologies and operational innovations. n 19th September TSA Coventry, UK TSA’s one-day conference and expo is the UK’s leading event for the bulk liquid storage sector. The conference will feature speakers from the COMAH Competent Authority and industry experts presenting on hot topics. Sixtytwo companies are exhibiting at the event, showcasing their products and services for the bulk liquid storage industry. n 19th September NISTM: 6th Annual Aboveground Storage Tank Conference & Trade Show Houston, Texas The conference is designed for engineers, managers and others who are involved with operations, construction, environmental compliance, spill prevention and response or management activities associated with aboveground storage tanks. During the conference experts will provide the latest information on tank management and share their knowledge on the most recent issues and technological advances.

October 2013

n 21-24th October API Storage Tank Conference & Expo San Francisco, California The annual API Storage Tank Conference provides attendees with new information on tank-related research, latest technologies and API petroleum standards. The conference features multiple panels and speakers discussing the requirements to maintain tank integrity while complying with new and existing environmental rules.

7

8 Rosen

16

8 Surface Active Solutions

31

8 Tank Storage Asia

68

Official magazine n 10-11th December Tank Storage Asia Max Atria, Singapore Expo This two-day conference and expo brings together terminal operators, traders, regulators and equipment suppliers.

Technology on display at the exhibition includes everything from tank design, construction and maintenance, to innovations in metering and measuring, pumps and valves, and automation and loading equipment.

MARCH 2014 Official magazine n 18-20th March StocExpo Ahoy, Rotterdam, the Netherlands The Storage Terminal Operators’ Conference & Exhibition (StocExpo) provides a platform for terminal operators, traders, regulators and equipment suppliers to do business. The 2013 event boasted more than 180 exhibitors from 29 countries across the world. A worldrenowned conference will run alongside the three-day exhibition.

APRIL 2014

n 23-25th April NISTM: 16th Annual International Aboveground Storage Tank Conference & Trade Show Orlando, Florida The conference and tradeshow will be held at the Rosen Shingle Creek Hotel for three days.

A golf tournament and welcome reception will take place on 22 April.

n 6-8th May Tank World Expo & Congress Dubai, UAE Over 60 exhibitors and 1,000 customers are expected to attend the expo next year, which is supported by industry players such as Saudi Aramco and Horizon Terminals. An unmissable event for suppliers of all tank farm civil, mechanical and instrumentation systems and services.

30

8 Veolia P43 Front Cover, Inside Front Cover 8 Volanic

december 2013

May 2014

8 Tanks and Terminal Management 76 8 Toptech

n 30-31st October European Bulk Liquid Storage 2013 Rotterdam, the Netherlands The two day event will be looking at the need to invest in storage facilities and the expansion of ports and terminals, with a focus on improving technical and HSE standards.

26

Chemical Storage Supplement 8 NPMA 8 Standic 8 StocExpo

9 Ouside Back Cover Inside Back Cover

Tank Storage magazine (ISSN 1750-841X) is published six times a year (in January, March, May, July, September and November) by Horseshoe Media Ltd, Marshall House, 124 Middleton Road, Morden, Surrey, SM4 6RW, United Kingdom.

The 2013 US Institutional subscription price is $240. Airfreight and mailing in the USA by Agent named Air Business, C/O Worldnet Shipping USA Inc., 155-11 146th Street, Jamaica, New York NY11434. Periodical postage pending at Jamaica NY 11431.

Subscription records are maintained at Horseshoe Media Ltd, Marshall House, 124 Middleton Road, Morden, Surrey, SM4 6RW, United Kingdom.

Air Business Ltd is acting as our mailing agent.

TANK STORAGE • July/August 2013

77

page header

Back cover CBI

xx

July/August 2013 • TANK STORAGE

The voice of the storage terminal industry

july/august 2013

Volume No. 9 Issue No. 4

The game changer It may be bust for parts of Europe, but the chemical sector in the US is most definitely booming

Offering a helping hand The Bulk Liquid Chemical Handling Guide tells you everything you need to know

Read the latest news, technology, progress updates and incident reporting relating to chemical tank storage!

chemical supplement

terminal news

Be seen by thousands worldwide in the Tank Storage magazine September/October edition!

Tank Storage magazine is excited to announce that we will be the official media partner to the 6th Annual NISTM trade show in Houston, Texas. In addition the next issue of Tank Storage magazine will be distributed at the TSA in Coventry, the API Storage Tank Expo & Conference in San Diego and European Bulk Liquid Storage 2013 in Rotterdam.

Featured topics in the next edition of Tank Storage magazine • Spill control, emergency response and remediation • Leak detection in tanks and pipelines • Fire prevention • Ground preparation • Hoses and couplings

xx

To get advertising prices or to request a copy of the media pack for 2013 please contact: David Kelly on +44 (0) 203 551 5754 or david@tankstoragemag.com

With bonus distribution at the following events • NISTM, Houston – Exclusive delegate bag distribution • TSA • API Storage Tank Expo & Conference • European Bulk Liquid Storage 2013 • Opslagtanks

For editorial information please contact: Margaret Dunn on +44 (0) 208 687 4126 or margaret@tankstoragemag.com July/August 2013 • TANK STORAGE

commment

What a turnaround JULY/AUGUST 2013 CHEMICAL SUPPLEMENT MANAGING DIRECTOR Peter Patterson Tel: +44(0)20 8648 7082 peter@horseshoemedia.com Publisher & editor Margaret Dunn Tel: +44 (0)20 8687 4126 margaret@tankstoragemag.com Deputy editor James Barrett Tel: +44 (0)20 8687 4146 james@tankstoragemag.com Assistant Editor Keeley Downey Tel: +44 (0)20 8687 4183 keeley@horseshoemedia.com Advertising Sales manager David Kelly Tel: +44 (0)203 551 5754 david@tankstoragemag.com PRODUCTION Alison Balmer Tel: +44 (0)1673 876143 alisonbalmer@btconnect.com

Just five years ago the US was one of the highest cost producers of ethylene, which is the building block for most chemicals.

Things were looking particularly bleak for the chemicals sector – spending on vehicles was well down and construction came to a virtual halt as lines of credit dried up.

Today, thanks to the shale revolution, US ethane prices are cheap, given that ethane is a by-product of oil and gas production and US producers are among the lowest cost producers worldwide.

The American Chemical Council estimates that companies plan $82.5 billion (€63 billion) of spending on new chemical facilities along the Gulf and Eastern coasts, creating a further $194 billion of new economic activity.

Many are also suggesting that the US could be energy independent as soon as 2030. All this change is going to have a

dramatic effect on the storage market.

For the time being US crude exports are still very much restricted. This means many of the storage opportunities could well lie in breakout storage for different components, rather than for storing the crude itself.

Within our chemical storage supplement we take a closer look at this boom in the US market, as well as the growth in terminals handling chemicals across the globe. We also take a look at some of the specific requirements needed for tanks handling the different chemicals. We would be interested to hear your own thoughts on how the shale revolution has impacted you – so if you have a story to tell, please get in touch,

Best wishes, Margaret

contents 2 News 5 Terminal update 6 Technical news 9 Incident update 10 The game changer It may be bust for parts of Europe, but the chemical sector in the US is most definitely booming 12 Does your biofuels effluent exceed regulatory limits?

13 Offering a helping hand The Bulk Liquid Chemical Handling Guide tells you everything you need to know

Blackwater Midstream gets approval for terminal expansion Liquid terminal company Blackwater Midstream is expanding its chemical storage terminal in Westwego, Louisiana.

The company is reportedly building two new tanks with a total capacity of 4 million gallons for unspecified, non-flammable chemicals. The terminal currently features 46 tanks.

Westwego City Council approved the plans at the beginning of July.

Blackwater eventually wants to add at least six new tanks to six acres of free land at the 26 acre site. A proposal for six facilities was initially submitted to the council in June but only two were approved.

Alexandria Chemicals Terminal to expand in Egypt Alexandria Chemicals Terminal (ALXCT) is the first-of-itskind terminal in North Africa. The bulk chemicals storage and handling terminal on the Egyptian Mediterranean coast has the capacity to store 17,000m3 in 14 tanks.

And, in light of the increasing demand for bulk chemicals, this capacity is set to grow. Phase two of ALXCT project, which consists of constructing an additional 13 tanks with a capacity of 38,500m3, will be complete by the end of the year. This will take the facility’s total capacity to 54,600m3.

Phase one of the terminal was completed in August

TANK STORAGE • July/August 2013

2009 and is constructed at Al Dakhaila port, Alexandria.

ECG Engineering Consultants was involved in building the facility. At the harbour quay, 550m away from the terminal, a chemical receiving station was set up to secure conveyance of industrial chemicals to the chemical storage tanks via three extended piggable pipelines.

Other facilities at the site include a state-ofthe-art truck loading station for bulk chemical land shipments and nitrogen generators for tank blanketing of all chemical storage tanks.

2

news

An additional 40 storage tanks will be built on the site

Standic expands terminal as chemical imports rise inland. With this in mind Standic does not need to build any additional infrastructure to complement the new chemical storage tanks.

The company is, however, make a call for potential in talks to build a fifth jetty at contractors for the project, the site. ‘We are negotiating with a view to begin with authorities for an extra construction by the beginning jetty. This is not for the new of next year. The cost of the tank pit but it will certainly project was not disclosed. help prevent congestion.’

‘We are about to bring The current storage out the tenders for this and we capacity at Standic’s are also still waiting for several Dordrecht terminal is close to permits, such as construction 200,000m3, making it the larger permits. Right now we are in of two terminals belonging between the planning phase to the Tankstorage Beheer group. Standic handles three main product groups at the facility: chemicals, biofuels and base oil products.

‘Just over 50% of our 200,000m3 storage capacity is now for biofuels, biodiesel in particular,’ Voogt says. ‘Today we are one of the largest biodiesel hubs in the ARA [AmsterdamRotterdam-Antwerp] region and an important player for biodiesel tankage here.’

Standic expects to receive increased volumes of chemical products in the future

Despite Europe’s step back from chemical production, one terminal operator predicts storage demand for the product will grow Independent bulk liquids storage provider Standic is expanding chemical storage capacity at its terminal in Dordrecht, the Netherlands.

The company will build 40 storage tanks with a total capacity of 30,000m3 for speciality chemicals on 9,000m2 of free land at the terminal.

The tanks will range between 500 and 1,500m3 in size.

Speaking to Tank Storage magazine Paul Voogt, Standic’s commercial director, reveals that the company is growing chemical capacity at the terminal as it predicts that certain chemical product groups will be imported more and more in the coming years.

‘European chemical producers are not as active in the marketplace anymore due to cheaper feedstock prices and better availability in other regions,’ he explains.

‘Many chemicals will be imported from the US, South America and the Middle East.’

The company will soon

3

and bringing out the tender.

We aim to break ground by the end of this year but that depends on the authorities and how quickly we receive approval from their side.’

When ground does break on the expansion, it will take around 12 months to complete.

The new tanks are expected to come online in the first quarter of 2015. ‘All 40 tanks will be built at once in a single phase,’ Voogt explains.

Describing the Dordrecht terminal as a ‘typical tank truck terminal’, Voogt says the facility is located slightly

July/August 2013 • TANK STORAGE

news

Chemical storage laws under review A fatal explosion at a fertiliser plant in Texas has caused existing laws regarding hazardous material handling to come under scrutiny.

The state’s lawmakers are reported to be reviewing the regulations in order to determine whether they need to be made more stringent.

In April, 15 people died and 200 were injured after a fire at West Fertilizer’s plant caused 60,000lbs of ammonium nitrate to explode.

The incident is said to have

highlighted the fact that chemical regulations focus more on preventing criminals or terrorists getting hold of chemicals rather than on its safe handling and storage.

Under federal law, companies that store ammonium nitrate must submit an annual report stating the average volume they handle daily and their maximum storage capacity.

While West Fertilizer submitted its review, reports state it may not have been properly considered.

Chemical storage regulations could be made tougher

RSA and Talke form JV for chemical storage facility RSA Logistics, a provider of transport and logistics services headquartered in Dubai, and Talke, a German chemical logistics company, have formed a joint venture.

The 50/50 partnership is building a chemicals storage facility, RSATalke, at Dubai World Central (DWC) aerotropolis which will offer logistics services to the Gulf region.

‘The production, as well as the import and export of specialty chemicals, is gaining an importance in the Gulf region,’ says Richard Heath, Middle East and Asia

The RSA-Talke chemicals storage facility

TANK STORAGE • July/August 2013

director at Talke and director at RSA-Talke.

Abhishek Ajay Shah, director of operations and business development at RSA, adds: ‘As part of this trend we support our customers by providing added capacity for high quality and safe logistics services.’

The facility is expected to be operational by the beginning of 2014.

It will provide direct connections to both local and international road and sea routes in addition to Maktoum International Airport.

Storage tank built for Stolthaven Bluff A new storage tank has been erected at Stolthaven Bluff’s terminal in New Zealand.

Stolthaven Bluff serves the region’s dairy industry, providing storage for chemicals, vegetable oils and tallow.

The 20 tonne tank has a capacity for 500,000 litres of nitric acid and will be used by the Fonterra Edendale plant.

Crown Sheetmetal built the tank, which took staff six weeks and 2,000 man hours to manufacture.

It was lifted into place at the Island Harbour at the end of April.

Aqaba Oil Terminal to undergo improvements Aqaba Development’s oil terminal in Jordan is to be upgraded after the company signed an agreement with Beta Engineering Manufacturing and Erection at the end of March.

Under the $28 million (€21.8 million) EPC agreement, Turkey-based Beta is to install and upgrade the facility’s oil pumps, improve the existing loads arms and implement new ones to handle chemicals, crude oil, petroleum products and liquid petroleum gas. The project will also improve safety at the terminal and enable night operations.

The oil terminal in Aqaba supplies over 90% of Jordan’s demand for crude oil and petroleum products.

With this in mind, the terminal will remain operational during the project’s execution to avoid oil shortages to the nation.

Aqaba’s CEO H.E Eng. Ghassan Asa’ad Ghanem says: ‘The signing of this agreement is part of Aqaba Development’s plans to rehabilitate and construct an integrated ports community, which consists of 28 terminals. The rehabilitation of the oil terminal is a core part of Aqaba ports’ community.’

According to Ghanem, part of the work will be carried out by a Jordanian contractor as Aqaba works to support local contractors and the kingdom’s economy.

4

tank terminal update

Chemical storage terminal update Aqaba Development Location Products

Jordan Chemicals, crude oil, petroleum products and LPG Construction / expansion / The facility will be upgraded acquisition to improve its oil pumps and the existing loading arms Designer / builder Beta Engineering Manufacturing & Erection Project start date March 2013 (agreement signed) Investment $28 million (€21.8 million) Comment The project will also improve safety at the terminal and enable night operations

Calumet Speciality Products Partners Location Products

San Antonio, Texas, US Naphtha, speciality solvents, reformates, jet fuel, ultralow sulphur diesel, LPG and other specialised fuels Capacity 14,500 bpd Construction / expansion / Calumet acquired the facility acquisition from NuStar Energy Completion date January 2013 Investment $115 million (€89 million)

Humen Port Group and Topsafe Petrochemical Logistics Location Products

Guangzhou, China Chemicals and petrochemical products Capacity 182,100m3 Construction / expansion / Humen Port Group transferred acquisition its 15% equity in Humen Topship Petrochemical Terminal to Topsafe Petrochemical Logistics Completion date May 2013 Investment RMB32.67 million (€4 million) Comment CNPC still holds 51% equity in the terminal, Topship Chemical and Topsafe Petrochemical Logistics holds the remaining 34% and 15%, respectively

RSA-Talke Location Products Construction / expansion / acquisition Project start date Completion date

Dubai, UAE Chemicals Construction June 2013 (announced) Q1 2014

Stolthaven Bluff Location Products Capacity

New Zealand Chemicals, vegetable oils and tallow 1 tank for 50,000 litres of storage for nitric acid Construction / expansion / Construction acquisition Designer / builder Crown Sheetmetal Completion date April 2013

Vopak Location Products Construction / expansion / acquisition

Alemoa, Brazil Chemicals Vopak is expanding the terminal by 37,000m3

Vopak Location Products Construction / expansion / acquisition

Caojing, China Chemicals The terminal is being expanded by 52,400m3

Vopak Location Products Construction / expansion / acquisition Completion date

Banyan, Singapore Chemicals Expansion of 100,200m3 2013 (commissioned)

Vopak Location Products Construction / expansion / acquisition Project start date

Penjuru, Singapore Chemicals Expansion of 47,000m3 Q2 2012 (announced)

Odfjell Terminals Location Products Capacity Construction / expansion / acquisition Project start date

5

Houston, US Chemicals 331,333m3 Expansion of a further 30,800m3 2013

For a full list of chemical and oil storage terminals order our Independent Tank Terminal Map. Visit: tankstoragemag.com/its_map_new.php

July/August 2013 • TANK STORAGE

technical news

Tube companies to join forces

New pumps can handle viscous fluids White Knight Fluid Handling has developed two new airoperated double-diaphragm (AODD) pumps, suitable for handling viscous fluids such as food-based products, cosmetics and slurries containing solid materials.

The PSD08 and PSD16 models can achieve up to 63 litres per minute (lpm) and 142 lpm flow rates respectively, while minimising air consumption and operational noise.

Fine Tubes, a UK-based manufacturer of metal tubing for the chemical and oil and gas sectors, has partnered with Superior Tube, a US producer of metal tubing.

Both companies are owned by the Watermill Group and the partnership will enable Fine Tubes to now serve the US market. The two companies will share a new global association while maintaining their own names and specialities.

Brian Mercer, global sales and marketing director, says: ‘The opportunities for this arise, not only through the sharing of best practices together but also through the increased combined product offering the two companies will have and the ability to provide secure back-up to our customers where single source supply is not untypical.’

The plastic design is leak proof and icing-resistant when used with corrosive chemicals.

The pumps are available in 0.5 and 1” models respectively, with optional materials to meet the abrasion-, temperature- and chemicalcompatibility requirements of a number of applications.

They are suitable for the semiconductor, solar and LED sectors, offering the means of chemicals distribution, reclaim and bulk transport processes.

Nov Mono expands pump portfolio with company acquisition National Oilwell Varco (NOV), a supplier of oilfield solutions, has completed the acquisition of Robbins and Myers.

The deal will see many of Robbins and Myers industrial products placed under the Houston-based NOV Mono division of National Oilwell Varco, resulting in NOV Mono becoming one of the largest designers and manufacturers of progressing

cavity pumps technology.

Since the merger the two companies have begun executing an integration plan designed to combine their operations, subsidiaries and product lines with limited impact to customers.

Robbins and Myers business was a supplier of engineered equipment and systems for applications in chemical and global energy

markets. The following Robbins & Myers businesses are now part of NOV Mono: • Moyno: manufacturer of progressing cavity pumps, sludge pumps, metering pumps, sanitary pumps, mag-drive pumps, multiphase fluids transfer systems and grinders.

• Chemineer: provider of mixing technology and manufacturer of quality

New flow meters aim to provide precise measurement Badger Meter, a developer and manufacturer of flow management solutions, has made new additions to its Industrial Oval Gear (IOG) series of flow meters, which provide solutions for industries, such as chemical and oil and gas.

Badger Meter’s IOG flow meters are designed to measure viscous (up to 1,000 cP) and caustic fluids, such as oils, coolants, fuels, lubricants, ink, paint, water solutions and other liquids. The meter line is accurate (+0.5 to +1%) in low-flow environments, and measures liquid flows as low as 0.07 gallons per minute (gpm) and up to 185 gpm.

The units are compact, suitable for either vertical or horizontal installation into confined areas, and do not require a straight run of

pipe or flow conditioning. Models are available in either aluminium or 316L stainless steel construction.

Durable construction means these flow meters can be employed in harsh environments where conventional flow-measuring equipment cannot. This includes processes with fluid temperatures between -30 to 120°C. The oval gear configuration means the number of wearable parts minimal. Models are available with a choice of NPT or BSP threaded connections, or ANSI 150 or 300lb flanges. A variety of instrumentation, both meter- and remote-mounted, is offered for control system interfacing or local monitoring.

TANK STORAGE • July/August 2013

equipment for fluid agitation applications.

• Tarby: manufacturer of progressing cavity replacement parts and pumps.

In addition to the recently acquired Robbins and Myers businesses, NOV Mono also has manufacturing facilities in Australia, China, the UK, Argentina and Houston, Texas.

Blackmer offers new sliding vane pumps Blackmer, a supplier of positive displacement and centrifugal pumps and reciprocating compressor technologies, says its NP and SNP series of sliding vane pumps meet the needs of a number of operations in oil and natural gas exploration and production.

The areas in the oilfield where NP and SNP pumps can be utilised include offshore oil platforms, oil and gas production sites, central tank batteries, chemical well treatments and field terminals.

The NP series of pumps offer a range of seal and material options for handling a variety of clean, non-corrosive liquids, while the stainless-steel SNP series of pumps are able to handle corrosive and caustic fluids.

NP series pumps are available in five port sizes, from 1.5- 4”, with the SNP Series also available in five port sizes, from 1.25-3”.

6

technical news

Ergil StorageTech to provide storage tank safety for aromatics facility Essar Group has selected Ergil StorageTech to provide storage tank safety equipment at its new condensate splitter and aromatics facility on Jurong Island.

Under the contract, Ergil will supply pressure vacuum vents, emergency vents, gauge hatched and rim vents to the $320 million (€245 million) Jurong Aromatics project.

Essar’s contract forms part of a $2.4 billion grassroot aromatics complex on the island. The scope of Essar’s contract includes building storage tanks, jetties with loading and unloading arms and pipeline systems, as well as the utilities for the entire complex.

StorageTech is an group brand of Ergil, focused on manufacturing a range of storage tank equipment.

Diluted bitumen no greater risk to pipeline release A new report by the US National Research Council believes diluted bitumen has no greater likelihood of accidental pipeline release than other crude oils.

The committee which wrote the report found that diluted bitumen has physical and chemical properties within the range of other crude oils and that no aspect of its transportation by pipeline would make it more likely than other crude oils to cause an accidental release. The committee was not asked to address whether the consequences of a diluted bitumen release differ from those of other crude oils.

With bitumen imports from Canada’s oil sands on the rise, Congress passed legislation in January 2012 calling upon the secretary of transportation to determine whether any increase in the risk of a release exists for pipelines transporting diluted bitumen.

The US Department of Transportation asked the Research Council to convene an expert committee to analyse one aspect of this risk: whether pipelines transporting diluted bitumen have a greater likelihood of release compared with pipelines transporting other crude oils.

The study committee reviewed pipeline incident statistics and reports of investigations, analysed data on the

chemical and physical properties of diluted bitumen, examined the technical literature, consulted experts in pipeline failure mechanisms such as corrosion and cracking, queried pipeline operators on their operations and maintenance practices, and solicited comments from the public.

The committee did not find any causes of pipeline failure unique to the transport of diluted bitumen. In addition, it found no physical or chemical properties outside the range of other crude oils and no evidence that pipeline operators manage or maintain their systems any differently when transporting diluted bitumen compared with other heavy crude oils.

‘Diluted bitumen has density and viscosity ranges that are comparable with those of other crude oils,’ Mark Barteau, professor of chemical engineering at the University of Michigan and chair of the committee that wrote the report, was quoted as saying.

‘It moves through pipelines in a manner similar to other crude oils with respect to flow rate, pressure and operating temperature. There’s nothing extraordinary about pipeline shipments of diluted bitumen to make them more likely than other crude oils to cause releases.’

Belven ball valves suitable for underground installations Belven’s BV4 split body ball valve is now available for new applications.

The valve can be fitted to Belven’s PE-DSTE-Telescope for underground installations such as foam concentrate for underground fire fighting lines, for example. This consists of the telescopic double stem extension and the BV4-Top ball valve.

The construction, made from stainless steel, features the telescopic double stem extension, BV4-TOP ball valve and ANSI150 flange connection.

The most popular sizes are 2” and 4”. The complete mounting and construction can be amplified with position indicators and surface boxes.

And a high demand for Trunion valves has seen Belven develop its Trunion B4. This ranges in size from 3-24” and is ideal for liquid applications with full support at the top and bottom of the ball.

Belven expects to finalise the construction of its new offices and warehouses before the middle of this year. The completion of these facilities will allow Belven additional capacity for its BV4 stock, ensuring quick delivery.

Two new fluoroelastomers from chemical company International company AGC Chemicals has added two new lines of fluoroelastomers that it says can benefit moulded and extruded components used in extreme conditions such as heat, steam and corrosive materials.

The Aflas 100 and 150 series are copolymers of tetrafluoroethylene and propylene, a combination AGC

7

says uses properties not found in conventional fluoroelastomers.

It also claims the Aflas products, when used in wire and cable coatings, engine seals, gaskets and other highendurance components in a variety of industries, provide flexibility and toughness when used with polymer products and moulded parts.

Belven is building new facilities to ensure fast delivery of its BV4 valves

July/August 2013 • TANK STORAGE

technical news

Yokogawa releases new pressure calibrator Yokogawa Meters and Instruments has released a new pressure calibrator suitable for the chemical, oil and gas and petrochemical industries.

The portable CA700 has functions which enable the calibration of pressure/differential pressure transmitters and other types of field devices.

The calibrator is equipped with a silicon resonant sensor and can measure pressures with an accuracy within ±0.01% of reading (rdg). It can output and measure current and voltage within ±0.015% of rdg. The CA700 is also suitable for testing both

pressure and DC input/output.

For more stable and efficient calibration, the CA700 is able to store the calibration procedures for pressure transmitters and switches in its internal memory. It also records data and error rates before and after calibration.

The stored data can be used for purposes such as analysis of device performance and determination of maintenance frequency, thus improving device maintenance.

The CA700 comes in three models with different measurement ranges: -80200 kPa (kilopascal), -80-1,000 kPa, and -80-3,500 kPa.

Neptune introduces low-volume hydraulic diaphragm metering pumps Neptune Chemical Pump, a manufacturer of chemical metering and peristaltic pumps, has launched a new model of metering pumps.

The Model 5003-S and 5005-S Hydraulic Diaphragm Metering Pumps are, according to Neptune, ‘lowvolume pumps which deliver repeatable flows down to quarts per day, making them ideal in oil and gas production and recovery, and in refineries’.

The pumps feature Eze-Clean valves, allowing for the valve cartridges to be removed for cleaning without disturbing the piping. Electronic stroke-length control is available along with explosion-proof models, which can be used in a variety of hazardous environments.

Sign up now to receive your FREE weekly newsletter providing up-to-date information on acquisitions, mergers, new terminals and the latest regulations: www.tankstoragemag.com/tsm_newsletter.html

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TANK STORAGE • July/August 2013

8

incident report The latest information on fires, leaks, spills and accidents in the chemical sector n 27/06/13 Voltaix Chemical products leaked from the plant late on 27 June following a fire and explosion.

Upper Mount Bethel The fire started in a 10,000 gallon tank at around 10pm and was quickly contained. No-one

Township, Pennsylvania, US was injured and evacuations were deemed unnecessary.

The facility sustained considerable damage and CEO Pete Smith said it could be closed for at least a week. n 25/06/13 Red Star

Moscow, Russia

A fire broke out inside a chemical storage tank at Red Star’s plant. Fifteen fire fighter units were sent to the scene to tackle the blaze.

n 24/05/13 Sri Lanka A fire at the port’s warehouse has been blamed on the improper storage of h`azardous

Sri Lanka Colombo Port chemicals.

According to reports, the company responsible for importing the chemical failed to inform customs about the nature of the cargo. If customs were aware the hazardous material would have been properly stored.

The fire destroyed the entire warehouse and its contents. The cost of the damage was estimated at Rs.556 million.

The National Petroleum Management Association Petro Expo 2013 Conference & Exhibition 18th-21st November 2013, Washington DC, Hilton Alexandria Mark Centre The Fuelhandler magazine, the official exhibition catalogue for the NPMA’s Petro Expo.

Make sure you get in front of all the movers and shakers in the aviation fuelling industry.

For commercial opportunities please contact: Anisha Patel • anisha@thefuelhandler.com • +44 (0) 203 551 5752 For editorial contributions please contact: Margaret Dunn • margaret@horseshoemedia.com • tel: +44 (0) 208 687 4126

www.npma-fuelnet.org The Fuelhandler magazine, the world’s premier publication 100% dedicated to the aviation fuelling industry 9

July/August 2013 • TANK STORAGE

analysis

The game changer It may be bust for parts of Europe, but the chemical sector in the US is most definitely booming

by Phil Thane Chemicals are something of a catch-all category. Some, often defined as petrochemicals, are derived from crude oil and are not so different to petroleumbased fuels with similar storage requirements. Others might be produced as a by-product of oil refining like sulphur for example, which is produced during the de-sulphuring of fuels.

Others are closely associated with food or feed production and are often stored by food specialists. A third group have little connection with oil or food and maybe used in hundreds of different industrial processes.

Business looking up, or is it?

the increase in chemical manufacturing in the Far East, BASF is very much there to stay and, consequently, we continue to pick up business from that site.’

But it is over in the US where the exploitation of shale gas is breathing new life into the chemicals sector. In North America, the central theme is a strong drive to develop and monetise shale gas. This has prompted several chemical majors to invest in new world-scale crackers. These petrochemical plants will enjoy a competitive advantage over the rest of the world, since, apart from the Middle

TANK STORAGE • July/August 2013

East, feedstock costs will be the lowest in the world.

In 2012 William Banholzer, executive VP at Dow, predicted by 2030 the US chemical industry will be the biggest user of natural gas almost doubling its current consumption.

In Louisiana this growth is already starting to have an impact. Dan Borné is president of the Louisiana Chemical Association (LCA) which represents more than

jobs overseas. Natural gas was too expensive and too scarce to justify continued manufacturing production. So we looked at importing LNG as feedstock, and dozens of terminals were planned. With the commercialisation of shale gas, the entire economic model was turned on its ear.’

On the Gulf Coast, companies use natural gas to produce about 80% of the basic building block, ethylene.

60 manufacturers operating at over 100 locations around the state. He acknowledges that following Hurricane Katrina there was substantial government investment in several areas of Louisiana, but he believes private sector investment is driving the economy now, and most of that is in chemicals: ‘The chemical industry is huge. Our basic feedstock is natural gas, which we use like a bakery uses flour. If we don’t generate electricity with it, or heat and steam, we use it as the building block for dozens of chemicals.

‘The production of shale gas in Louisiana and in other parts of the US has been the game changer. Five years ago we were shutting down operations and shipping

Overseas, oil is used for the same purpose. When the cost ratio of a barrel of oil to one MBTU of gas is at least 7 to 1, the market can beat most of the rest of the world competitively. Currently the ratio is around 30:1, which is incredible. This is why Methanex is dismantling two methanol plants in Chile and shipping them to Geismar, Louisiana.

Borné does not speak specifically for the tank storage industry, but as he points out: ‘One can certainly intuit that with the tsunami of production coming to Louisiana and Texas, the tank business will prosper.’

In the UK, and the EU generally, development of shale gas is proceeding cautiously.

The British Geological Survey estimates there may be 1,300 trillion cubic feet of shale gas

‘The production of shale gas in Louisiana and in other parts of the US has been the game changer’

Source: Peter Lambert-Gorwyn, Specialist Coatings Ltd

The chemical industry does not function in isolation. It uses a lot of energy and often has oil and/or gas as a feedstock too. Its customers are generally manufacturers, from heavy engineering to cosmetics.

Consequently it is sensitive to energy prices and the fortunes of manufacturing companies.

Vopak’s annual report for 2012 notes the chemical storage business varies around the world: ‘During the year we experienced reduced chemical volumes at some of our European distribution terminals, especially in the first half, mainly due to lower demand in key sectors of the automotive and construction markets. Our US sites increased their volumes over the year, while our major Asian sites remained at healthy levels.’

Richard Sammons, CEO of Simon Storage, says his perception of the state of the UK market matches Vopak’s

for Europe as a whole, but he sees reasons to be positive.

‘The chemical market in the UK unfortunately, feels as though it’s in a gradual decline due to closures of chemical manufacturing plants,’ he says.

‘This year we’ve lost the Total polystyrene plant and that has led to a decrease in the volume of styrene we handle. Having said that we have increased our share of the chemical market in the UK and overall it feels to us like it’s pretty solid’ Sammons is even more positive about Simon Storage’s operations in Germany where it has a terminal just across the Rhine from BASF’s site at Ludwigshafen.

‘The BASF plant is almost beyond comprehension. They employ around 33,000 people in 160 separate manufacturing plants on a 10km2 site. Despite

10

Source: Peter Lambert-Gorwyn, Specialist Coatings Ltd

analysis present in the north of England Having said that, it does not seem likely a shale gas powered boom will change the UK chemical storage business in the same way in the near future.

In many respects the chemical storage business operates like the oil and gas storage. Bulk chemicals are often traded around the world, stored in terminals at ports then distributed, usually by truck.

Most of this storage is organised on long-term contracts with regular shipments arriving and departing. The main competition in this trade comes from companies using ‘tank containers’, i.e. tanks in a frame the same size as a shipping container that can be handled without any specialist infrastructure.

Containers make sense for small quantities but Sammons believes that once a company starts shipping more than about 2,000 tonnes a year its fixed storage becomes competitive.

Short-term storage is also needed from time to time, and the terminal operators try to be accommodating.

Manufacturers sometimes need storage to stockpile product ahead of a planned shutdown and, during a stoppage, may need to store precursor chemicals and intermediates. Larger terminals with a range of tanks are at an advantage here.

Special requirements Clearly chemicals vary, and the storage requirements for, say, de-mineralised water and concentrated hydrochloric acid are different. Size matters too; tanks up to around 4m diameter and 100m3 capacity or a little more can be made in plastic, beyond that stainless steel, or mild steel with an appropriate corrosion-resistant lining are preferred. In practice this means most tanks in

11

sulphur, which is produced by oil refineries as a result of making low-sulphur fuels.

Sulphur is solid at ambient temperatures, and flammable.

It melts at a relatively low 130°C, so it is more convenient to ship and store it in its molten form and move it by pipes and pumps. To keep the sulphur liquid it is stored in heated and insulated tanks.

UM Group, formerly part of Tate & Lyle, began life storing molasses as a byproduct of Tate & Lyle’s sugar production, then began to offer surplus capacity to other manufacturers initially in the food and feed category.

These days it accepts a wide range of industrial chemicals and have acquired terminal sites that has no connection with sugar at all. In addition to storage UM offers some processing capability to its customers chiefly blending and separating of various liquids.

Most of UM’s tanks are stainless or mild steel, ranging from 13,000m3 down to 100m3.

At its Liverpool, UK site where some processing is carried out smaller GRP tanks are used. Almost all tanks used for chemical storage need lining.

For many years vulcanised rubber has been the standard

coating used when dealing with aggressive chemicals.

The rubber (or Source: Peter Lambert-Gorwyn, Specialist Coatings Ltd

The business model

terminals are steel, those in production facilities or at end users’ plants are often plastic.

Simon Storage, for example, has many contracts for chemical storage, and a database going back to 1970. If it is asked to store a particular chemical it can usually find a record of where and when it last stored it, which tanks were used and what special linings or other adaptations were required.

One rather special product Simon Storage handles is

Specialist Coatings estimates that relining a tank costs about a tenth of the cost of building a new one

synthetic rubber) is supplied un-

generally some form of epoxy resin, are also popular. There is a huge range of different products to choose from to suit different conditions, tank materials and products being stored. Specialist tank coating contractors will have a database enabling them to select the best coating

vulcanised in sheet form and glued to the tank walls and floor. To be vulcanised, it has to be heated to around 100°C and held there for some time.

In the case of small containers, and things like pipes and connectors, the item is placed in a heated autoclave, but that is impractical for large tanks so they are heated by piping steam into the tank.

It can take a long time to heat a large steel tank, particularly if it is un-insulated, so to ensure that the whole thing has reached the correct temperature it may be necessary to heat it for 24 to 36 hours. Once vulcanised, rubber is resistant even to strong acids, but if a small area is not correctly heated it will soon break down and allow the acid to penetrate behind the coating.

Chemical tanks are sometimes lined with a sheet of butyl rubber like a pond liner.

This can be effective but, just like a pond, the sheet is forced into wrinkles and folds to fit the shape and that can make cleaning difficult. Often that is not particularly important but it can be a problem if the stored material is one in which mould or bacteria flourish.

Liquid applied coatings,

for any particular situation.

Resins are usually sprayed on using high volume airless spraying equipment, but contractors may use brushes or rollers in awkward spaces.

Whatever lining is used, surface preparation is vital to ensure a good bond between lining and substrate. Before coating the substrate should be shot blasted to bare metal.

In the case of bolted sectional tanks, a flexible sealant is applied to the inside of the joints before a primer coat and finishing coat is applied to the whole surface. The lining should then be checked for thickness and for any areas of micro-porosity. At this stage both can be rectified if necessary but, if left, will lead to problems later.

UK-based Specialist Coatings estimates that relining a tank costs about a tenth of the cost of building a new one, making it a costeffective means of redeploying infrastructure as demand in the storage market changes. Of course it may be necessary to change pipework and valves, tank gauging, flow meters heaters, insulation and safety features as well, so swapping from one product to another is never likely to be a quick fix.

Resins are usually sprayed on using high volume airless spraying equipment

July/August 2013 • TANK STORAGE

analysis

Does your biofuels effluent exceed regulatory limits?

The US EPA, as well as many other regulatory agencies around the world, has established limitation guidelines for discharges of ‘oily wastes’ from facilities using any type of oil and grease in their manufacturing process.

Several years ago there were a few biodiesel plants in the US that were fined for illegally discharging into nearby streams. It only takes a few bad apples to sour an industry’s reputation. An accurate, quick and simple form of on-site analysis to test oily waste prior to discharge helps ensure oil and grease compliance.

Regulations: oil and grease compliance Oil and grease limits vary depending on where the effluent is discharged. Surface waters typically carry more stringent regulations than waste going to a municipal treatment facility. Industrial effluent limits of oil and grease going into

a sewer can be as low as 100 ppm or 4 ppm for discharging directly into a waterway. In the US, permits are issued by the National Pollution Discharge Elimination System (NPDES) or directly from states that have federal permission to issue permits. In the case of biodiesel producers, there are currently no specific guidelines from the EPA which may make the permit process lengthier.

Oil and grease testing Method 1664 is the EPA regulatory method. This is a time consuming method that takes a trained technician to perform. The hydrocarbons in the water are extracted into hexane which is then evaporated off and the residual is weighed. The process can take up to two hours and require proper laboratory conditions. For the biofuels processor, the key concern is making sure the pretreatment system is functioning and

Closeup InfraCal TOG-TPH Analyzer

TANK STORAGE • July/August 2013

nothing is released that is over the limit. Having an on-site oil and grease testing method that takes only a few minutes allows an operator to check the system parameters at any time there is a concern it may have been overloaded.

The offshore oil community has faced this issue for over 40 years. Helicopters regularly fly over the Gulf of Mexico looking for a sheen on the water coming from an oil platform. If an oil platform is out of compliance with their discharge, they face a hefty fine. The technology of choice for measuring oil and grease on many platforms is infrared so results can be obtained by a non-technical person in less than 10 minutes. Daily checks are standard and more can be done if there is a system upset.

Infrared measurement of oil and grease An advantage of infrared analysis is the ease of use and the quick analysis time.

Portable, relatively inexpensive fixed filter infrared instruments, such as the Wilks InfraCal TOG/TPH Analyzer, allows for on-site analysis for industrial pretreatment personnel. The extraction and measurement procedure involves several simple steps allowing an operator with minimal training to do the analysis.

1. The sample is collected in a container. A solvent such as hexane, perchloroethylene or S-316 is added at a ratio of one part solvent

to 10 parts sample 2. The sample is shaken for two minutes and the solvent will separate, carrying dissolved oil and grease with it 3. The solvent extract is placed on the analyser’s sample stage and the measurement result is displayed minutes later.

The analysis time from sample collection to final result is less than 10 minutes. Only a small amount of solvent is needed for analysis; using a 100ml sample requires only 10ml of solvent. For those that require it, ASTM D 7066 is an infrared oil and grease method.

Using portable infrared analysers enables operators of a biofuels production facility to easily measure their oil and grease levels prior to releasing into the sewage system or into surface waters.

This gives them the advantage of taking samples before and after treatment to see how the system functions under heavy loads. System parameters can be changed and the results of the changes determined without waiting a week or more for an offsite laboratory result. Most importantly, effluent that is above regulatory limits can be stopped before it impedes the flow of the sewer line or is discharged into a waterway, thereby avoiding fines.

For more information:

This article was written by Sandy Rintoul, president of Wilks Enterprise, srintoul@WilksIR.com +1 203-855-9136

12

Chemicals and their Classification

guidelines lower due to the reduced atmospheric pressure, meaning that it will have increased flammability and risk of fire when stored or handled.

1.9.3.7 Fire point

1.9.3.9 Auto-ignition temperature The auto-ignition temperature is the minimum temperature required to ignite a gas or vapour in air without a spark or flame being present. It is the lowest temperature at which a substance will start to burn without the aid of an external flame. The auto-ignition temperature is not generally used when classifying flammable and combustible liquids (see Section 1.9.3.3 and Figure 1.18). However the ignition temperature of products is used for temperature classification of electrical equipment used in hazardous areas (see Section 12.3.3).

The fire point is the lowest temperature at which the liquid gives off vapour fast enough to support a flame for at least five seconds after the original ignition flame has been removed. The flashpoint is a lower temperature than the fire point since at the flashpoint the substance will ignite briefly, but may not produce enough vapour to maintain the flame. In general, the fire point for a substance is about 10°C higher than its flashpoint and allows an assessment to be made of a substance’s 1.9.4 Solubility ability to support combustion.

A liquid storage terminal has Institute has brought out to their handling and storage.

Solubility characteristics and rules have so many operations taking the Bulk Liquid Chemical Thedealing BLCH provides detailed influence when you are with solids, 1.9.3.8 Minimum ignition energy (MIE) place, each with individual Handling Guideliquids (BLCH). information on different or gases.

This overview relates more The minimum ignition energy (MIE) is the specifically to liquids.products and their physical and critical disciplines BLCH does not minimum energy required from an ignitionThe source like tanks, drumming, provide an industry standard, and chemical properties, for to successfully ignite a fuel-oxidiser mixture, The solubility of a substance or product is the whether combustible vapour, packaging, road and rail, gas or dust butcloud. instead recognises the example their flashpoint and amount of the substance (substance in the The ignition energy needed is dependent on the ships, barges, wastewater requirements ofsmallest all applicable minimum ignition energy (the amount called the solute) that can be specific chemical or mixture, concentration of dissolved in another substance in and pressure emergency legislation. It provides minimum (substance energy required fuel, and response. temperature. If an ignition the largest amount called form ato All require the application instruction on recognised fromthe ansolvent) ignitionto source source, for example a spark or electrostatic homogeneous mixture of the two substances. The discharge from fluid flow, exceeds the energy of best industry practice. ‘good practice’ for the safe successfully ignite a vapour, degree to which a substance is soluble is also levels of a substance’s Information exists, MIE, but it can provide and secure handling in by thefactors such gasas ortemperature, dust cloud).pressure affected a source for ignition. As examples, a static from so many sources that bulk liquid chemicals industry. and the presence of other solutes, which could discharge of 22 mJ is initiated by walking across increase or decreaseReference the degree guide of solubility. is fragmented andplug often Of importance are the ait carpet, and a spark has discharge energy difficult locate. characteristics that chemicals of 25 mJ.toThe lowerSo theinMIE of a substance, the For most, but not all, substances the solubility more likelyto anthis ignition source will ignite it. MIE response demand exist under as various BLCH also provides increases with a riseThe in temperature and the values are related to flammability limits and LOC are highly the Chemical Distribution conditions significant information that those degree of solubility is broadly expressed as: working (limiting oxygen concentration).

Material

0.015

Acetylene

0.017

Hydrogen

0.03

Alkanes

0.28

Aromatics

0.2

Methanol

0.14

Acetone

1.15

Aluminium

10

Polystyrene

15

Magnesium

20

Silicon

100

Rayon

240

tank. (All other levels and alarm set points are determined relative to the overfill level.)

yy very low or sparingly soluble Overfill level (maximum capacity) yy insoluble.

The tank rated capacity is a theoretical tank level, far enough below the overfill level to allow time The solubility of one liquid in another is also to respond to the final warning (eg the LAHH) and still prevent loss of containment/damage. described as:include an allowance for thermal expansion of the contents after filling is complete.

It may also

yy Miscible, where the substances form a homogeneous liquid regardless of the Tank rated capacity concentration of either substance, such as alcohol and water The LAHH is an independent alarm driven by a separate level sensor etc. It will warn of a failure of some element of a primary (process) control system. It should be set at or below the yytank Immiscible, where the substances are rated capacity to allow adequate time to terminate the transfer by alternative means insoluble in eachbefore other,loss such as oil and of containment/damage occurs. water.

Ideally, and where necessary to achieve the required safety integrity, it should have a trip action to automatically terminate the filling operation.

The product solubility or miscibility should be The LAH isinanrelation alarm derived from the ATG (part of the process control system). This alarm is the expressed to the particular solvent first stage overfilling protection, and should be set to warn when the normal fill level has been (ie water, hexane etc). exceeded; it should NOT be used to control filling.

Gasoline (petrol)

Minus 40°C

Hexane

Minus 23°C

Acetone

Minus 17°C

Toluene

4°C

Methanol

11°C

Ethanol (70%)

16.6°C

Vegetable oil (canola)

327°C

Flashpoints of various substances

13

Factors influencing the alarm set point are: providing a prompt warning of overfilling and maximising the time available for corrective action while minimising spurious alarms 27 eg due to transient level fluctuations or thermal expansion.

Response Time 3

LAHH

Response Time 2

LAH Response Time 1

Normal fill level (normal capacity)

Increasing flammability

Flashpoint

www.chemicalhandling. org and www.cdi.org.uk

yy slightly soluble

Table 1.7 – the Minimum energiesthe The lower MIE ofignition a substance, more likely an ignition source will ignite it.

As an example a static discharge of 22mJ is initiated by walking across a carpet

Substance

For more information:

yy AnySoluble increase in level beyond the overfill level will result in loss of containment and/or damage to the

MIE (mJ)

Carbon Disulphide

at the terminal are expected to know. For example overfill and action levels from the Buncefield report are listed and explained.

Other sections within the guide include fire safety, vapour and emission control and emergency response planning.

Defined as the maximum level to which the tank will be intentionally filled under routine process control.

Provision of an operator configurable ‘notification’ also driven from the ATG may assist with transfers though it offers minimal if any increase in safety integrity.

Trip (where necessary)

Alarm

Notification (optional)

Overfilling protection: Tank levels (based on API 2350)

July/August 2013 • TANK STORAGE

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TANK STORAGE • July/August 2013

14

terminal news

Outstandic in storage

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July/August 2013 • TANK STORAGE