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WORD FROM THE EDITOR
www.storageterminalsmag.com
Whereto LNG? Long touted as a cleaner energy solution to conventional carbon sources like coal and oil, LNG production has been riding a wave. Not so long ago, Qatar dominated the export market leading to worries that the world could become too dependent on just a handful of LNG suppliers. But that has all changed, from Russia to Australia, and latterly, America, new sources of LNG have come on stream. Liquefaction production has rocketed in recent years but LNG demand growth has stagnated in many markets for the time being, driving down spot prices to their lowest levels in 20 years. Fearing supply shortages some buyers bought too much LNG without firm customers for onward sale. Now the market faces the prospect of surplus cargoes flooding the market as new projects conceived when the outlook was rosier come on stream. All this bodes uncertainty for the LNG supply chain over the next few years. One consultancy, ESAI, believes that the LNG market will not eliminate its surplus capacity until about 2024. However, from 2025 on the next wave of liquefaction will be needed as demand catches up and then exceeds supply. In this issue STM carries an 11-page feature looking at the intricacies and uncertainties surrounding LNG production, supply and demand. It includes the prospect of America partfunding receiving infrastructure to temper Russia’s hold over European gas supplies, and why establishing a proper pricing hub in Asia remains problematic, despite that region being the most promising growth market in terms of demand. With all the caveats that come as new industries find their feet, the long term future for LNG must look good. Old hydrocarbon revanchists, such as those who seem to hold inordinate sway over current US energy policy, will find that the slow creep to cleaner energy will not be reversed. Indeed, many of their compatriots have been quick to spot the market potential for exporting US gas to markets that remain hungry for it. So, there will be up and downs, and disappointments along the LNG wave, but sensible, strategic investments stand a good chance of winning through.
Neil Madden EDITOR
STO RAG E T E R M I N A L S M AGA Z I N E AU T U M N 2 01 8
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CONTENTS
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www.storageterminalsmag.com
33
Mediterranean LPG trades
Rapid firefighting technology
A special report on LNG
Contents 12
World terminal news
33
LNG’s supply-demand mismatch
All the news from the global terminal sector
A special report on LNG markets and the consequences for infrastructure investment
52
Refinery conversions
A row in Ghana over the possibility of converting an iconic refinery to storage
54
Mediterranean storage & logistics
71
91
Aviation fuelling systems
98
Pump technology
Two case studies from Honeywell and Varec on how fuelling systems keep the planes flying
A look at the benefits of sliding vane pumps over alternative systems
106
Loading arms
The key variables to keep in mind before designing or building your next loading arm system
112
Equipment focus
115
Technology & automation
141
Upcoming events
The changing nature of Mediterranean LPG trades, plus an innovative system for stock monitoring in Turkey
Applications and case studies from Certispec and Leica
59
Upstream & Downstream
What’s new in process industry technology, equipment & automation
67
More than a pipedream
71
Firefighting technology
76
Protective coatings
80
Process technology
Latest news from along the bulk liquid supply chain
North Sea Port sets out an ambitious plan for cross-border pipeline infrastructure
A preview of Tank Storage Asia and TSA 2018, plus other conferences and exhibitions this year for the global storage business
A Swiss company introduces a rapid firefighting system to combat tank blazes
Belzona updates one of its most popular coatings
A look back at the 2018 Achema event
106 8
Loading arms
STO RAG E T E R M I N A L S M AGA Z I N E AU T U M N 2 01 8
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PUBLISHER Greg Emmenis greg@storageterminalsmag.com EDITOR Neil Madden editor@storageterminalsmag.com ONLINE EDITOR
Katerina Kerr katerina@storageterminalsmag.com The front cover is proudly sponsored by Advanced 3D Laser Solutions Ltd lasersurveying.com
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Published four times a year Storage Terminals Magazine is the premier business magazine for executives, technicians, engineers and all professionals working in the global bulk liquids storage industry. With its high level content, industry expert contributions and unparalleled global news coverage, Storage Terminals Magazine gives you the information you need to make your business run smoother, safer and more profitably. So whether you want an update on the effects of oil price movements on demand for storage capacity, technical articles on how to ensure your facility runs as efficiently as possible, or the latest updates on regulation and environmental compliance, you will find all you need in Storage Terminals Magazine. Enjoy!
All rights reserved No copy without the written consent of the publishers first, can be lent, resold, hired out or otherwise disposed of in a mutilated condition or in any unauthorised cover, by way of trade, or affixed to or as any part of a publication or advertising, literary or pictorial matter whatsoever. Storage Terminals Magazine trading as Industry Vision Media Group are full protected by copyright and nothing may be printed wholly or in part without permission. Every possible effort has been made to ensure the information in this publication is accurate at the time of going to press and neither the publishers nor any of the authors, editors, contributors or advertisers can accept any responsibility for any errors or omission, however caused. For certain articles within this publication we have used stock images to improve the aesthetics of the page. No responsibility for loss or damage occasioned to any person acting, or refraining from action, as a result of the material in this publication can accept by the editors, authors, the publisher or any of the contributors or sponsors.
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50
YEARS 2018
WORLD TERMINAL NEWS
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World
Terminal NEWS
GOOD BUT mixed YEAR FOR OILTANKING
O
iltanking had a successful albeit mixed year, according to an annual review by parent group Marquard & Bahls. Some sites saw a decline in capacity utilisation. At the same time, many contracts were extended and several major projects advanced. In Matola, Mozambique, Oiltanking successfully commissioned a new tank terminal. At year end, Oiltanking operated 80 terminals in 25 countries, with a total capacity of 21 million cbm. In view of the new tank terminal projects currently under construction and the expansion of existing locations, Oiltanking is confident that it will continue to grow in the future. This involves in particular the areas of gases and chemicals. The aviation fuelling business, Skytanking, had a good business year. Many sites in Europe, India and Africa reported an increase in throughput volumes. Key events included the start of aviation fuelling in Malta, and the acquisition of the Sun Jet Services Group
12
in Germany. Following this transaction, Skytanking is now the market leader for aviation fuelling in the Germany, Switzerland and Austria region. At the end of 2017, Skytanking was represented at 71 airports around the world and recorded a total throughput of 18.1 million cbm of jet fuel. In view of increasing globalisation and mobility, the
outlook remains positive. Marquard & Bahls says it strives for further international growth in the future. The focus is on expanding the core activities of trading, tank storage logistics and aviation fuelling. The strong operating base and solid financial position provide a good starting point for future projects and plans.
STO RAG E T E R M I N A L S M AGA Z I N E AU T U M N 2 01 8
WORLD TERMINAL NEWS
www.storageterminalsmag.com
NEW TERMINAL FOR MYANMAR
Artist’s rendering of STEPS
A new multi-purpose terminal is to be developed in Myanmar’s Yangon region, according to local media reports. The region’s authorities have submitted plans to establish the terminal in Kawhmu township with the aim of promoting regional development and facilitating the country’s trade with neighbouring countries. According to local media, the plans include a port on 1,053 acres along a 2.2km waterfront with a river draft of 9m and a bulk liquid storage terminal.
RANGELAND STARTS STEPS Rangeland Energy III has commenced operations at its STEPS terminal located in Corpus Christi, Texas.
R
angeland also announced that the company will start loading diesel in rail tank cars for a leading customer in the refined products industry. The diesel will be delivered to a third party with terminals in Mexico using the rail system of Kansas City Southern Railways. “Rangeland will be facilitating the transport of diesel to different destinations in Mexico for an important member of the petroleum industry,” said president Christopher Keene. “This is our first client in the STEPS terminal. As we continue to develop our terminal, we will keep in touch with other important players in the Mexican market, refineries and oil companies, and offer STEPS product delivery and reception services.” STEPS is an integrated hydrocarbon logistics system that receives and stores refined products, LPG and other hydrocarbons at a central terminal and transports them to terminals mainly in Mexico. During the initial phase of the
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project, refined products and LPG will be received at the Corpus Christi terminal and then shipped to third party terminals in Mexico. In future phases, maritime terminals in Corpus Christi and in Mexico will be added to the system, along with the infrastructure to accommodate additional products including crude oil, condensates and fuel oil. The STEPS project is expanded using the experience of Rangeland developing infrastructure and similar projects in areas such as the Bakken Shale and Permian Basin. The Corpus Christi terminal is located along the Kansas City Southern Railroad, 8km from the Port of Corpus Christi and the refineries of Valero, CITGO and Flint Hills. Products that enter will initially be delivered by trucktank or rail tank car, followed in the future by pipelines and barges. Refined products and LPG will be delivered outside the STEPS terminal mainly by rail tank, but the terminal will eventually be able to connect to pipelines and maritime terminals in the future.
BRIGHTOIL IN ZHOUSHAN SALE TALKS Brightoil Petroleum (Holdings) Limited is reportedly in preliminary negotiations with potential investors for the sale of its Zhoushan Oil Storage and Terminal facilities, and its 15 marine shipping vessels (VLCC, Aframax, Barge). The company said: “These two intended sales, once realised, shall bolster the financial strength and provide support to the long term strategic developments of the Group.” The firm added that it is to make a further announcement once the details and terms of the two intended sales are ironed out and agreed, and “until then it should be noted that these intended sales are still at a preliminary stage”.
AMID to sell marine terminals American Midstream Partners is selling its marine products terminal business to institutional investors advised by JP Morgan Asset Management, for approximately US$210 million in cash, subject to working capital adjustments. The transaction is expected to close in the third quarter of 2018. The divestiture of the Marine Products Terminals, including the Harvey and Westwego terminals located in the Port of New Orleans and the Brunswick terminal located in the Port of Brunswick in Georgia, is a continuation of the partnership's noncore asset divestiture programme.
STO RAG E T E R M I N A L S M AGA Z I N E AU T U M N 2 01 8
CUSTODY TRANSFER MEASUREMENT Brodie BiRotor Plus positive displacement meters offer unsurpassed accuracy and reliability. As the best in class meter for accuracy of custody transfer measurement, they set the industry standard.
Superior Performance Linearity: up to +/- 0.075% Repeatability: up to 0.02% Turndown Ratio: up to 30:1
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ENGRO, VOPAK IN LNG INFRASTRUCTURE AGREEMENT
E
ngro Corporation of Pakistan and Royal Vopak have signed a share purchase agreement in which Vopak will acquire a 29 percent share in Elengy Terminal Pakistan Ltd (ETPL). ETPL’s wholly owned subsidiary, Engro Elengy Terminal (Pvt) Ltd (EETPL) owns an LNG facility which is located in Port Qasim in Pakistan, adjacent to the Engro Vopak chemical terminal on the mainland side of the channel into Port Qasim. The facility has been in operation since 2015 and is the first LNG import facility in Pakistan. The facility consists of an LNG jetty including a 7.5km high pressure gas pipeline. This pipeline is connected to the grid of EETPL’s sole customer Sui Southern Gas Company Ltd, a Pakistan government owned entity. EETPL holds a 15-year Floating Storage and Regasification Unit (FSRU) time charter. The liquified gas is supplied, under long-term contracts, via LNG carriers from various exporting countries to the FSRU, which is moored to the EETPL jetty and connected to its pipeline. The regasification takes place on the FSRU and the gas is transferred to the mainland where, under high pressure, it enters the grid of the customer. Pakistan is a market with more than 200 million people and has a growing energy demand in which the share of gas is expected to increase. Gas is mainly used for power supply for the growing population, industrial usage and as feedstock for fertilisers. After completion of this transaction, the shareholders in ETPL will be Engro Corporation, Vopak and the International
Finance Corporation. “Our relationship with Vopak is over two decades strong, and today’s announcement is another step towards further strengthening that relationship,” said Engro president and CEO Ghias Khan. “We are excited to enter into this mutually beneficial partnership which will allow Vopak to realise their strategy of entering the Pakistan energy market and will pave the way for Engro and Vopak to collaborate in further ventures at home and abroad using their combined resources and expertise. “Engro has always endeavoured to bring the best of the world to Pakistan because we recognise that developing markets require FDI in infrastructure and projects to remain on a path of progress.” Vopak chairman and CEO Eelco added: “We very much look forward to build, inside and outside of Pakistan, on our excellent partnership with Engro. This new step in our co-operation gives Vopak an excellent entry in the growing Pakistan LNG market. This fits very well our ambitions to grow and diversify our service offering in LNG.” Engro’s business relationship with Royal Vopak dates back to 1997, when the then-named Engro Chemicals Limited entered into chemical storage and handling business in a joint venture with a predecessor of Royal Vopak. In November 2017 a memorandum of understanding was signed between Engro and Vopak to explore potential growth opportunities, within Pakistan and abroad, in industries including LNG, chemical storage, and terminal operations.
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ELAFLEX - Gummi Ehlers GmbH Schnackenburgallee 121 · 22525 Hamburg, Germany Tel. + 49 40 540 005-0 · info@elaflex.de www.elaflex.com
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STO RAG E T E R M I N A L S M AGA Z I N E AU T U M N 2 01 8
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WORLD TERMINAL NEWS
www.storageterminalsmag.com
The new terminal is expected to reduce Andeavor’s cost to import fuels into Baja California supporting its network of ARCO branded stations
U
nder the terms of an agreement with CFEnergía, a subsidiary of CFE, Andeavor will sign a longterm lease for the land and will construct and operate the facility, for a total investment of approximately US$100 million. The infrastructure is expected to reduce Andeavor’s cost to import fuels directly into Baja California supporting its growing network of ARCO branded stations and other customers in Northwest Mexico. “The expansion of our branded business in Mexico allows us to extend our integrated West Coast value chain into this attractive and high growth
ANDEAVOR TO DEVELOP refined PRODUCTS TERMINAL Andeavor has announced plans to build a refined products terminal at the Rosarito storage facility of Comisión Federal de Electricidad (CFE), in the state of Baja California, Mexico. geography,” said Greg Goff, chairman, president and CEO. “This logistics project will strengthen Andeavor’s ability to deliver gasoline and diesel cost effectively to our customers directly from our
refineries on the West Coast.” Andeavor expects the redevelopment of the Rosarito facility to be complete in about two years, pending required regulatory approvals and permits.
SHELL COMPLETES TIGA SALE Shell Gas Holdings (Malaysia) Limited has completed
the sale of its 15 percent shareholding in Malaysia LNG Tiga Sdn Bhd (MLNG Tiga) to the Sarawak State Financial Secretary (SFS) for an agreed US$750 million. SFS is an existing MLNG Tiga shareholder and with completion of this transaction, increased its shareholding to 25 percent. The transaction has an economic date of 1 September 2017, and the net final consideration paid to Shell after adjustments for dividends the company received up to completion is approximately $640 million. The other shareholders of MLNG Tiga are Petronas with 60 percent equity, Nippon Oil Finance (Netherlands) BV with 10 percent, and Diamond Gas
20
(Netherlands) BV with 5 percent. Malaysia LNG Sdn Bhd, a Petronas subsidiary, operates MLNG Tiga as part of the larger Petronas LNG Complex in Bintulu. This sale is consistent with Shell’s strategy to simplify its portfolio and reshape Shell into a simpler, more resilient and focused company. Following the expiry of the MLNG Satu and Dua joint venture agreements, MLNG Tiga was Shell’s only remaining interest in the Petronas LNG complex. Shell said the completion of the sale demonstrates its momentum behind its global divestment programme.
STO RAG E T E R M I N A L S M AGA Z I N E AU T U M N 2 01 8
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WORLD TERMINAL NEWS
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Enterprise’s new gulf coast facility come on the heel of a second successful loading of a VLCC at the Texas City terminal
ENTERPRISE PLANS NEW CRUDE TERMINAL
E
nterprise Products Partners is to develop an offshore crude oil export terminal off the Texas Gulf Coast. The terminal would be capable of fully loading VLCCs, which have capacities of approximately 2 million barrels and provide the most efficient and cost-effective solution to export crude oil to the largest international markets in Asia and Europe. “On the heels of our second successful
BOTAS CONTRACT FOR TSE, PETROFAC
loading of a VLCC at the Texas City terminal, we are now planning to expand our capabilities to load crude oil faster and more cost efficiently without the need for lightering vessels,” said Jim” Teague, CEO of Enterprise’s general partner. Enterprise has started front-end engineering and design (FEED) and preparing applications for regulatory permitting. Based on initial designs, the project could include approximately 80 miles of 42ins diameter pipeline to an
Petrofac and the Turkish Standards Institution (TSE) have secured a three-year multi-million dollar project management consultancy (PMC) services contract in support of the BOTAŞ North Marmara Underground Gas Storage Expansion Project (Phase III) in Turkey. Koray Yenigürbüz, group head at TSE and the JV project director, said: “The overall project involves the expansion of a key Turkish facility, with both onshore and offshore components.” The existing facility, located
offshore terminal capable of loading and exporting crude oil at approximately 85,000 barrels per hour. “Capital and infrastructure to support our project would be solely provided by private capital and would not be reliant nor contingent on state or federal government agency financial support or infrastructure development. We believe this would enable us to deliver this project in a timely manner once permits are granted and the project is underwritten,” stated Teague.
approximately 60km west of Istanbul, has been in operation since 2007 and BOTAŞ intends to expand its working gas capacity to 4.6 billion cbm. The TSE Petrofac JV is responsible for managing and supervising areas which will cover the main phases and scopes of work. These include detailed design, engineering, procurement, construction, drilling and decommissioning, along with commissioning and start-up activities.
BOTAS intends to expand its working gas capacity to 4.6 billion cbm
STO RAG E T E R M I N A L S M AGA Z I N E AU T U M N 2 01 8
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MAGELLAN, LBC TO EXPAND SEABROOK Magellan Midstream Partners and LBC Tank Terminals have announced plans to increase Seabrook Logistics’ crude oil and condensate storage and dock capabilities in the Houston Gulf Coast area. Seabrook Logistics, owned 50/50 by subsidiaries of Magellan and LBC, plans to construct nearly 700,000 barrels (111,000 cbm) of additional crude oil and condensate storage in Seabrook as well as a new Suezmax dock with up to a 14m draught and approximately 400,000 bpd of dock capacity. Following completion of the announced expansion, Seabrook Logistics will own approximately 490,000 cbm of storage, deepwater access through an Aframax dock and a Suezmax dock and connectivity to Magellan’s Houston crude oil distribution
system, providing it access to multiple inbound crude oil pipelines. This latest expansion is estimated to cost approximately US$120 million, shared equally by Magellan and LBC, and is expected to be operational by late 2019, subject to receipt of all permits and approvals. If the facility were fully built out, Seabrook Logistics would have up to 870,000 cbm of storage capacity and a total dock capacity of at least 700,000 bpd, with options to further increase dock throughput capacity.
S T O LT H A V E N H O L D S S A F E T Y D A Y S Stolthaven Terminals has held several Safety Days at its terminals around the world in a drive to improve and reinforce safety culture in the company. A second safety day will be held later in the year. “Everyone should have the expectation that they can return home from work safely, without injury or incident,” the company said. The company noted that risks in day-today life become part of ‘normal’ life and are taken for granted. Complacency can then
become the risk. When Stolthaven held its first global, co-ordinated safety day, the messages were to the point and lessons were learned. The initial focus included promotion of safety awareness for employees and their responsibility to their colleagues; engaging employees to focus on safety as a ‘time out’ from their normal duties; and highlighting local issues specific to the individual terminals. Among the day’s events, Stolthaven Moerdijk, in the Netherlands, incorporated the safety day into its team event day, delivering team building with an external facilitator. In the UK, Stolthaven Dagenham focused on its suppliers providing background information.
This helped employees to understand exactly why we wear PPE, not just that we have to wear it. There was also a focus on how safetycritical components work – and why no one should just walk past if they notice that a component is damaged. Stolthaven Houston explored risk awareness and how it impacts on everyone, personally and professionally. The terminal’s safety day started with video and leadership messages, which were followed by group presentations, department showcases on how they reduce risks for the terminal, and finally a celebration of service awards.
Stolthaven Houston explored risk awareness
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ODFJELL TO SELL ROTTERDAM TERMINALS Odfjell is offloading its Rotterdam facilities to Koole Terminals, of the Netherlands.
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n May, Odfjell announced that private equity outfit Lindsay Goldberg (LG) was considering selling its 49 percent shareholding in Odfjell Terminals BV (OTBV), and that Odfjell would consider tagging along on an outright sale of OTBV subsidiaries Odfjell Terminals Rotterdam (OTR) and Odfjell Terminals Maritiem (OTM). Now an agreement has been struck whereby Odfjell is selling its 100 percent ownership of OTR and OTM for US$155 million net of estimated transaction costs. Further, Koole will compensate OTBV for all permitted equity injections made in 2018 until closing. The intended transaction
would at closing reduce Odfjell Terminals net debt by around $35 million. Odfjell SE’s share of the proceeds at closing is expected to amount to around $100 million and result in an estimated book loss for Odfjell SE of about $100 million. Any sale will be subject to the employee consultation procedures being finalised, finalising documentation and to customary regulatory approvals. LG’s exit from the remaining shareholding in OTBV is still ongoing. “This is a landmark transaction for us,” said Kristian Mørch, CEO, Odfjell SE. “We have been working hard to restore profitability at OTR during the past years, and the terminal is now ready for the next step of development, which will require significant investments. We are
OTR is now ready for the next step of development
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therefore pleased to have Koole as the potential purchaser. Koole has great ambitions for the terminal, and we are confident in their ability to realise the value potential this business represents. Following a sale of OTR, Odfjell will have a network of seven tank terminals worldwide. We remain committed to our tank terminals business and will allocate capital for growth of Odfjell Terminals in the years to come.” Frank Erkelens, CEO, Odfjell Terminals, added: “OTR is well positioned to continue with building a successful future on the fundaments of its strategic location in Port of Rotterdam, its unique capabilities, its top quartile safety performance and its strong organisation. On behalf of Odfjell Terminals, I pay tribute to all the stakeholders of OTR for their continuous support. Odfjell Terminals remains focused on providing best in class safety and service performance to our respected customers across our terminal network.”
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