December 2012, Vol. 239 No. 12

Advertisers from the print edition of <em>Pipeline & Gas Journal</em>, December 2012, Vol. 239, No. 12.

This is a story about good people. People of diverse backgrounds from different parts of the country brought together by natural gas, the Marcellus Shale.

<em>Pipeline & Gas Journal</em>’s line pipe tabulation provides a quick reference to information on most line pipe sizes, walls, grades and manufacturing processes.

According to market studies, all indications are that the importance of the shale gas market is not going to diminish in the foreseeable future. On the contrary, significant growth is projected in many quarters. For example, a 2011 report issued by ICF International on behalf of the INGAA Foundation predicted that total United States and Canada shale gas production will jump from 2010 levels of about 13 Bcf/d to 52 bcf/d by the year 2035.

Celebrity attention – well-meaning but sometimes misdirected -- and other international pressures can disrupt pipeline construction timelines and budgets. Globally, oil and gas explorers and producers are being pushed to work in more difficult environments, whether surface, subsurface, or “politically” in order to find and transport reserves. It is only to be expected that people who may be affected by a resource project will have concerns that relate to real impacts or perceived impacts.

<strong>High Output From Unconventional Sources</strong> The United States will overtake Saudi Arabia to become the world's biggest oil producer by 2017 and will be energy independent 10 years later, according to World Energy Outlook, a new forecast by the International Energy Agency released Nov. 12. "The recent rebound in U.S. oil and gas production, driven by upstream technologies that are unlocking light tight oil and shale gas resources, is spurring economic activity - with less expensive gas and electricity prices giving industry a competitive edge," the agency reported.

With the continued growth of natural gas as a key ingredient in the nation’s fuel mix comes increased focus on operational excellence as federal and state regulators and lawmakers closely monitor utilities to ensure they are not just properly maintaining their vast networks, but also working pro-actively to ensure the public’s well-being.

The engineering, procurement and construction (EPC) business has a buzz under way with the advent of a new natural gas industry building boom idling on the sidelines as more than a dozen proposals for federal permits await a decision on the start of a domestic LNG export program. The industry assumption is federal policymakers - regardless of who controls the White House - will give the green light to many of the export projects.

In this age of specialization, the pipeline industry takes a back seat to no one. One company that has applied its talents to everything from pipeline system integrity to environmental and water resources to projects/transactions to litigation support and much more is Houston-based G2 Partners. Perhaps their most unique capability is providing turnkey solutions for what they term “environmentally distressed real estate.”

Flow measurement technology is advancing at an ever-increasing rate. New engineering methods in the art of flow measurement are forcing a change for the better. Newer technologies often bring advances to the operational processes within many industries which can improve management and production. This article details the design and operation of a new genre of differential pressure (DP) cone meter.

How do you know when you have the right person for the job, albeit a difficult one that can tolerate no error in judgment? That was the dilemma facing the leadership of Pacific Gas and Electric Company after the catastrophic Sept. 10, 2010 transmission pipeline explosion that decimated an entire neighborhood in the city of San Bruno, killing eight and injuring a number of others. In addition to bringing down the wrath of regulators and lawmakers throughout the state and nation because of its shoddy record-keeping and questionable operations practices, it effectively shattered the morale of the huge utility company.

Whenever new regulations are introduced into any industry, they can be challenging as companies work to understand them, put together compliance plans, find technical solutions and identify the right processes and resources to help implement solutions.

As the battle rages to prevent the menace of corrosion, the pipeline industry and others will always be able to count on having NACE International at their side.

Polyethylene (PE) pipes and fittings are used extensively in distributing natural gas and water safely, reliably and economically, and enjoy an excellent performance track record. PE offers the pipe industry:

It is a common misperception that gas industry local distribution companies (LDCs) only deliver to -- and manage contracts and billing accounts for -- residential gas consumers. In fact, many LDCs also have large-scale transportation agreements in place with industrial or commercial consumers.

A recent report from analytical firm HIS says that although it is still premature to conclude that the Utica/Point Pleasant Shale play in Ohio and western Pennsylvania will be as productive as the Eagle Ford Shale in Texas, the Utica is in many ways analogous to the Eagle Ford and early drilling results are encouraging.

Decision-making in important national areas and politics mix like oil and water! Got rid of the politics for the time being – not really, but it is not as pertinent – so it is decision-making time for the government in the energy sector. Big decisions are waiting to be made in this very important part of the national agenda.

The results of the presidential and congressional elections portend "more of the same" with regard to issues of interest to the gas transmission industry. Regulatory dockets already under way will continue along their current track.

A subsidiary of BP was ordered to pay the state of Alaska $255 million for royalties lost because of production shutdowns after two North Slope oil spills in 2006 and a subsequent pipeline replacement project, according to the Anchorage Daily News.

BENTEK's Crude Awakening: Shale Boom Hits Oil forecasts Canadian crude oil production to rise 55% by 2022, with growth coming from oil sands and unconventional shale production predominately in Western Canada.

Gas Technology Institute and Spyglass Biosecurity, Inc. plan to jointly develop a new portable, automated water laboratory platform for monitoring bio-corrosion and gas souring. The system will provide rapid data about the presence of potentially harmful microorganisms in water used for petroleum resource production. It will also offer other onboard sensing functions to measure the chemical and biological composition of water samples.

Hoover Energy Partners LP and its affiliate Hoover Energy Texas Crude LLC have begun operations and is flowing oil on Phase I of its Pecos Crossing Pipeline, a 25-mile, 12-inch crude oil system that serves the heart of the Delaware Basin in Ward and Reeves counties in Texas.

Inergy Midstream, L.P. plans to buy Rangeland Energy, LLC, owner and operator of the COLT crude oil rail terminal, storage, and pipeline facilities, for $425 million.

A new poll finds Americans deeply divided on whether they believe the nation is on the right track regarding domestic energy policy. A plurality believes the government must lead the way in adopting domestic energy sources. Harris Interactive, a worldwide market research firm, conducted the poll among more than 1,000 adults that was commissioned by the Propane Education & Research Council.

The shale gas boom could be a major factor in cutting costs for the chemical industry as well as benefiting other industries, says a report from PwC US.

Despite persistently low natural gas prices, Shell hopes to boost profits by converting natural gas into diesel and other fuels, press reports indicate. While many of its competitors want to exploit the low prices by exports to Asia or Europe, Shell said it wants to bring its expertise in gas-to-liquid fuels into the U.S. fuel market.

ICF International’s Integrated Energy Outlook suggests that system operators must work with generators to coordinate more than 70 GW of fossil-fired capacity retirements and outages associated with 400 GW of new pollution control installations over the next four years.

The Czech Republic may secure a strategic stake in the TAL oil pipeline which would be an opportunity to book priority capacity in the pipeline that is its major alternative to the rapidly drying Russian Druzhba.

On Nov. 7, damage to a ballast tank on Floatel Superior working in the Norwegian Sea was discovered. Water seepage caused a 3-4 degree tilt that was corrected and rig stability was re-established.

On Nov. 14 in Milan, the Board of Directors of South Stream Transport, incorporating representatives of OAO Gazprom, ENI, EDF and BASF SE, discussed key issues related to the implementation of the South Stream project and made the Final Investment Decision (FID) for the South Stream Offshore Pipeline.

Fluor Corp. announced that Shell has awarded the company a five-year enterprise framework agreement for engineering and project management services for Shell’s downstream, and potentially, upstream onshore projects in Europe, Africa and the Middle East (EAME). Fluor will provide design, project and construction management, home-office and site-based engineering services.

Gazprom is finally bringing northwestern Siberia gas field on stream. Production at the massive Bovanenkovo gas field located on the Yamal Peninsula will be ramped up gradually to a level of 115 million m3 a year in 2017, an amount that corresponds to 23 % of Gazprom’s current annual gas production.

Grup Servicii Petroliere S.A. (GSP) was awarded the contract for pipelay and trenching services for the Hunter Pipeline replacement project by E.ON E&P UK Ltd. in the southern North Sea.

Rigzone reports that Iraq has signed a multimillion-dollar deal with South Korea's KOGAS that will set in motion the building of two key gas pipelines in the country's north - the latest step by Baghdad to refurbish dilapidated infrastructure.

MarkWest Energy Partners is developing additional processing infrastructure at its Mobley complex in Wetzel County, WV. MarkWest will construct Mobley III, a 200 MMcf/d gas processing facility, to support development of rich-gas acreage in the Marcellus Shale by EQT Corp. and other producers. The additional Mobley plant is supported by long-term, fee-based contracts.

Pieridae Energy Canada wants to develop an LNG export facility in Goldboro, Nova Scotia.

Pembina Pipeline Corp. plans to significantly expand its NGL and crude oil and condensate throughput capacity on its Peace and Northern Pipeline systems by an additional 108,000 bpd.

Rosneft and ExxonMobil selected Vostochniy Offshore Structures Construction Yard to conduct a concept evaluation and feasibility study for a platform capable of exploring Kara Sea’s shallow waters.

SemGroup Corp. and Gavilon LLC have completed acquisition of a 25% share of Glass Mountain Pipeline LLC, previously owned by an affiliate of Chesapeake Energy Corp. SemGroup now owns 50% percent of Glass Mountain Pipeline; the remaining 50% is owned by Gavilon. Chesapeake will maintain its long-term transportation agreement with Glass Mountain Pipeline, providing the economic incentive for its construction.

Sempra International’s Mexican business unit Sempra Mexico was awarded two contracts by Comision Federal de Electricidad (CFE), Mexico's state-owned electric utility, to construct, own and operate a 500-mile, $1 billion pipeline network connecting the northwestern states of Sonora and Sinaloa.

Vallourec’s full-service welding subsidiary Serimax was commissioned by Technip to provide services for the Ubarana – UGG project operated by Petrobras, off the coast of Fortaleza in northwest Brazil.

Spectra Energy has reached an agreement in principle to acquire a one-third interest in the Sand Hills and Southern Hills pipelines, both of which are under construction by DCP Midstream, LLC, a 50/50 joint venture between Spectra Energy and Phillips 66.

The United Arab Emirates (UAE) will soon produce enough gas to become energy self-sufficient, according to a poll of oil and gas professionals conducted at the ADIPEC Exhibition and Conference in Abu Dhabi.

Weatherford International has opened a multimillion-dollar facility in Singapore which will provide a strategic base for the company’s operations within the Asia Pacific region.

Western Australia will allow a joint venture of Buru Energy and Mitsubishi to develop five gas resources in the Canning Basin.

Cabinda Gulf Oil Company Limited has selected WorleyParsons Angola Limitada (WPAL) and INTECSEA, Inc. to execute the front end engineering and design (FEED) for the subsea facilities associated with the Lucapa field.