Author Archives: Colene Woolcott

1. Penspen Confirms ‘Diluted Bitumen’ Is No More Corrosive Than Conventional Crude

   February 28, 2013 9:11 am Leave a Comment

   Diluted bitumen in a crude oil transmission pipeline environment is no more corrosive than conventional crude, according to a recent report by Penspen Integrity.

   The report, Dilbit Corrosivity, commissioned by the Canadian Energy Pipeline Association, sought to examine the corrosivity of diluted bitumen compared to conventional crude. Based on a detailed review of the potential corrosion mechanisms in crude oil pipelines, Penspen’s report draws on findings from laboratory tests performed to internationally recognized standards. These tests conclude that there is no marked difference in the corrosive nature of diluted bitumen compared to conventional crude oil. As such, the report states that pipelines carrying diluted bitumen are subject to no additional corrosion control measures beyond what is already standard practice.

   The crude oil transported in most pipelines is obtained from reservoirs many thousands of metres below the earth’s surface. This ‘conventional’ oil is high quality, and flows easily. Today, many countries are looking at more ‘unconventional’ sources of oil, such as ‘oil sands’, a mixture of sand, water, clay and bitumen, which can be mined as it is on or close to the earth’s surface. Bitumen is a ‘heavy’ crude oil that is too thick to be pumped, without first being diluted or heated. Canada has huge reserves of these oil sands.

   For over 20 years, this diluted bitumen product, known as ‘Dilbit’ or ‘Synbit’, has been transported by crude oil pipelines and subject to corrosion control measures equivalent to those for conventional crude. Despite this operational history, there has been little published work on the corrosive properties of Dilbit, spurring false speculation as to its corrosive impact on pipelines.

   “These findings are an important contribution to the debate surrounding diluted bitumen,” said David Eyre, Principal Consultant at Penspen. “Without any substantiating evidence to reinforce current standard practices in dealing with diluted bitumen, Canada’s oil and gas industry has been plagued with criticism in regards to their operations. After reviewing over 40 studies, I am happy to provide scientific facts that dispel some of the misleading speculation about Dilbit and Synbit. I hope that the conclusions provided in this report will provide reassurance that the integrity management techniques currently employed by Canada’s Oil and Gas industry are effective at mitigating any risks of corrosion by diluted bitumen.”

   The Canadian Energy Pipeline Association represents Canada’s transmission pipeline companies who operate approximately 110,000 kilometres of pipelines in Canada. In 2011, these energy highways moved approximately 1.2 billion barrels of liquid petroleum products and 5.3 trillion cubic feet of natural gas. CEPA members transport 97 per cent of Canada’s daily natural gas and onshore crude oil from producing regions to markets throughout North America.

   For more information on Canadian Energy Pipeline Association, please visit www.cepa.com

2. Penspen awarded Feasibility Study for the Azerbaijan-Georgia-Romania-Hungary Natural Gas Interconnector

   September 25, 2012 9:14 am Leave a Comment

   AGRI LNG Project Company SRL, the project company for the AGRI Project, and Oil and Gas engineering group Penspen Ltd have today announced the signing of the contract to undertake a Feasibility Study for the Azerbaijan-Georgia-Romania- Hungary Natural Gas Interconnector Project (“AGRI”) as a result of international tender conducted by AGRI LNG SRL.

   The current shareholders of AGRI LNG Project Company SRL are the national oil and gas companies from each of the four participating countries in the AGRI Project, being Romgaz – Romanian National Natural Gas Company, SOCAR – State Oil Company of The Republic of Azerbaijan, GOGC – Georgian Oil and Gas Corporation and MVM – Hungarian Electricity Company Plc.

   On 13 April 2010, the Minister of Industry and Energy of Azerbaijan Mr.Natig Aliyev, Minister of Economy, Commerce and Business Environment of Romania Mr.Adriean Videanu and the Minister of Energy of Georgia Mr. Alexander Khetaguri signed a Memorandum of Understanding on cooperation in the field of LNG and its transportation, which laid the framework for the implementation of the AGRI Project and establishment of a project company AGRI LNG SRL headquartered in Bucharest. Hungary joined the AGRI Project in February 2011.

   Based on a linear east-west LNG chain, the AGRI Project is intended to transport and market Azerbaijani and other Caspian Region natural gas to Romania, Hungary and other Central European and EU gas markets through Georgia and the Black Sea via construction of new liquefaction and regasification terminals on the Black Sea coasts of Georgia and Romania respectively.

   The Feasibility Study to be conducted by Penspen Ltd will include:

   • Gas Market and Gas Supply analysis;
   • Development of conceptual engineering for pipelines and LNG terminals;
   • Economic and financial analysis;
   • Risk Assessment and environmental aspects.

   Work has commenced on the Feasibility Study which will be completed by November 2012 (5 months).

   At the award of the Feasibility Study for the AGRI Project, Penspen’s Director of Onshore Michael Simm, said:

   “We are delighted to have won this prestigious international study which will build further on our longstanding experience and reputation in this area. AGRI has the potential to open the way for Azerbaijani gas exports into Central Europe and we look forward to supporting this important project”.

   With the start of the Feasibility Study for the AGRI Project, the Shareholders of AGRI LNG SRL strongly believe that the AGRI Project will be an important component of the EU Southern Corridor for Caspian Gas to Europe and will play an important role in energy security of the European Union in the future.

3. Penspen Signs Engineering and Procurement Contract With Siemens

   July 31, 2012 9:14 am Leave a Comment

   Oil and gas engineering group Penspen has signed an agreement with Siemens to provide engineering and procurement services for a new simple cycle power plant in Southern Iraq. Siemens has agreed a base scope with the State Company for Oil Projects (SCOP) to work on the engineering and supply of the power plant and has in turn contracted Penspen to provide engineering and procurement services for the Balance of Plant.

   Under the terms of the agreement, Siemens will provide the engineering and supply of the power island, and Penspen will provide the remaining engineering and supply of the Balance of Plant (BOP) equipment/materials.

   Work will begin this month and is expected to go on until 5th October 2013. There is also potential for a further additional scope of works to be agreed.

   Senior Project Manager, Eduard Ilie said:

   “This is an important project for Penspen as it will provide a solid basis for the further development of our presence in Iraq and throughout the Gulf Region.”

   Director of Onshore Michael Simm, said:

   “We are delighted to have been awarded this project by Siemens and look forward to working with them to deliver a great outcome for SCOP.”

4. Penspen Signs $1.2 Million 2 Year Contract With PEMEX

   July 7, 2012 9:14 am Leave a Comment

   Penspen has signed a pioneering $1.2 million contract with a range of private and public companies and institutions to develop high level integrity policies and procedures for Mexican state-owned oil and gas company PEMEX.

   Under the terms of the agreement, Penspen will:

   • Assisting in the development of a plan for managing the integrity and reliability of transmission pipelines, gathering pipelines, onshore pipelines, offshore pipelines, storage terminals and maritime terminals.
   • Provide training related to pipeline integrity/risk assessment.
   • Review the current Mexican norm: NOM-027-SESH-2010 (Pipeline Integrity Management Plan).
   • Input into discussions on ‘best’ risk assessment methods, integrity evaluations, response to evaluations, and evaluation of compliance.

   The project is expected to start this month and has a value of U$ 1.2 million. It is the first of its kind involving over five different technical specialists.

   As part of the project, Penspen is working in collaboration with Corrosión y Protección SA. DE CV (CPI) to deliver integrity consultancy and training services to Universidad Autónoma de Campeche. In addition, SENER (National Secretariat of Energy) and CONACYT (National Science and Technology Council) are providing research and development services. Corrosión y Protección SA. DE CV (CPI) is also working together with CONACYT to develop a unified system for the reliability and integrity management of the Pemex logistics process.

   Other organisations signing up to the deal include The National Council of Science and Technology (SENER-CONACYT), Construction Company CPI, The Southwest Research Institute (SWRI), The National Autonomous University of Mexico (UNAM), and Campeche and Texas Universities.

   Penspen’s Director of Integrity Services, Nigel Curson, said:

   “Involving all the key players in the industry, this is a pioneering agreement in that it will serve to develop an integral integrity and reliability management system for PEMEX, allowing it to sustain and prioritise its operation, inspection, industrial safety and maintenance, within a solid institutional framework. Penspen has had a strong relationship with PEMEX for over 15 years and we look forward to working on this exciting project to drive up best practice standards in the oil and gas sector.”

   Penspen’s Technical Director, Phil Hopkins, commented:

   “PEMEX is a major oil and gas company, and like all majors, they must constantly seek to improve both safety and performance. This project will give PEXEX the procedures, strategies, and know-how to achieve both these goals. Penspen’s UK and Mexican teams are all looking forward to the technical challenges this project brings, and working with such a prestigious group of companies.’