20 Squeal Like a Pig Whether “Smart” Or Not, Pigging Tools Keep Pipelines Squeaky Clean

Published by Benjamin Media, Inc. Volume 5 Issue 3 March 2012

On the Cover: Pigging tools help keep pipelines clean and flowing efficiently. Inline inspection tools, aka “smart” pigs, pinpoint internal damage and provide a method for mapping pipelines for asset management.

20 Squeal Like a Pig Whether “smart” or not, pigging tools keep pipelines squeaky clean. By Bradley Kramer FEATURES

26 To Rent or to Buy? Find some guidance about equipment options in today’s pipeline industry. By Karma Newberry

31 Talent Search The oil and gas industry is seeking a new generation of workers to fill the ranks. By Sylvia Vorhauser-Smith

34 Threading the Trenchless Needle … Precisely Phoenix-based Specialized Services Inc. employed a laser guided boring system at an underground liquids petroleum gas storage facility. By Randy Happel DEPARTMENTS 8 News 16 Market Watch 18 Project Roundup 38 Product Showcase 40 Calendar

COLUMNS 6 Editor’s Message 42 Pipeline Perspectives

MARKETPLACE 40 Index of Advertisers 41 Business Cards

North American Oil & Gas Pipelines is published twelve times per year. Copyright 2012, Benjamin Media Inc., 1770 Main St., Peninsula OH 44264. USA All rights reserved. No part of this publication may be reproduced or transmitted by any means without written permission from the publisher. One year subscription rates: complimentary in the United States, Canada and Mexico. Single copy rate: $10. Subscriptions and classified advertising should be addressed to the Peninsula office. POSTMASTER: send Changes of Address to North American Oil & Gas Pipelines, P.O. Box 190, Peninsula OH 44264 USA. Canadian Subscriptions: Canada Post Agreement Number 7178957. Send change address information and blocks of undeliverable copies to Canada Express; 7686 Kimble Street, Units 21 & 22, Mississauga, ON L5S 1E9 Canada North American Oil & Gas Pipelines Magazine is not affiliated or associated with North American Pipe Corporation of Houston, Texas.

4 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com

Editor’s Message

Fear Dependence vs. Energy Publisher Independence Bernard P. Krzys Right now a debate rages in the U.S. Congress about a pipe- Associate Publisher line that could improve energy independence, but faces difficult Robert D. Krzys challenges from those who spread fears of contaminated aqui- Editor fers. In the Northeast, vast deposits of natural gas lie in wait James W. Rush for drillers to access this potent source of fuel, but fear mongers Associate Editor spread half-truths and misinformation about hydraulic fractur- Bradley Kramer ing and polluting the environment. And so it goes. These days, the oil and gas industry resembles a nasty political race, rather than a Contributing Staff Editors robust business market. Between the Keystone XL project tapping into oil sands in Al- Sharon M. Bueno Andrew Farr berta and the development of shale plays throughout North America, particularly in the Keith Gribbins Marcellus and Utica regions, the potential for energy independence is ripe — if only we Pam Kleineke could shed our dependence on fear. Kelly Pickerel The primary object of that fear tends to be the environment, and certainly the pipeline industry must strive to be a good steward of the land. You can see the effort that Graphic Designers TransCanada has made to ensure the safety of its Keystone XL pipeline proposal, endur- Sarah E. Hayes Chris Slogar ing three years of rigorous review. Granted, oil and gas has taken it on the chin over the Elizabeth C. Stull last two years, with an unfortunate string of high-profile leaks, starting with BP’s disaster in the Gulf of Mexico in April 2010. Marketing Director BP just settled with a group representing individuals and businesses of the Gulf Kelly Dadich Coast, agreeing to pay $7.8 billion in damages. After two years, including a yearlong Regional Sales Managers moratorium, deepwater drilling has finally started to regain momentum in the Gulf. Ryan Sneltzer The Deepwater Horizon incident was terrible, in the loss of 11 human lives and the Dan Sisko damage to the ecosystem. Afterward, however, the industry seemed to suffer from a Audience Development Manager piling-on effect. The PG&E pipeline explosion in San Bruno, Calif. The Enbridge spill in Alexis R. White Marshall, Mich. Exxon’s Silvertip pipeline leak near Billings, Mont. It seemed we were reporting a new incident every other week. Web & Interactive Manager Mark Gorman While pipelines remain the safest method of transporting oil and gas, these events sparked a vigorous campaign against the industry. Yet, the fears that opponents spread Conference Event Coordinator about oil and gas development and transportation pose an opportunity to enlighten. Vicki Losh The United States consumed 19.1 million barrels of petroleum products per day in 2010, according the U.S. Energy Information Administration, and 49 percent of that Editorial Advisory Board was imported from other countries. While a significant portion of U.S. petroleum im- Cortez Perotte ports originated in the Middle East and Venezuela, the majority (25 percent) came from Pipeline Product Engineer/Industry Representative, Caterpillar Inc. Canada. Expanding that relationship by approving the Keystone pipeline is a no-brainer, but Todd Porter the U.S. Senate failed to speed up approval of the project during a March 8 vote. Law- Vice President of Business Development, New Century Software Inc. makers vowed to try, try again. Expanding production of the shale plays should also take little thought. A study by Eric Skonberg Cleveland State University, released Feb. 28, reported that shale drilling could add $5 Principal Engineer, Trenchless Engineering Corp. billion to Ohio’s economy by 2014 and add about 66,000 jobs. Penn State conducted a Don W. Thorn similar study in 2011 that showed broad economic benefits from activities in the Marcel- President, Welded Construction LP lus shale. Indeed, expansion warrants caution. With such rapidly developing technol- Kevin Waschuk ogy, the industry must take strides to maintain safety and educate the public about the Vice President, Waschuk Pipe Line Construction Ltd. processes used in extracting oil and gas from shale. Bob Westphal Growth promotes growth. In the coming year, the oil and gas industry has a tremen- Senior Vice President, Michels Corp. dous opportunity to continue expanding, but first it must dispel fears and demonstrate Editorial & Advertising Offices safe practices. Education is crucial in winning over public appeal. 1770 Main St., P.O. Box 190 Peninsula, OH 44264 USA (330) 467-7588 • Fax: (330) 468-2289 www.napipelines.com e-mail: [email protected]

Reprints Brad Kramer Wright’s Media Associate Editor Ph: 877-652-5295 [email protected] Fax: 281-419-5712

BPA Worldwide Membership Applied for February 2012

6 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com

North America News BP Settles With Gulf Coast Group for $7.8 Billion Agreement to Resolve Economic Loss and Medical Claims From 2010 Oil Spill BP will pay $7.8 billion to ease the damage from the 2010 Deepwater Horizon oil spill in the Gulf Coast. The company announced it reached a settlement with the Plaintiffs’ Steer- ing Committee (PSC), subject to final written agreement, to resolve the substantial majority of legitimate economic loss and medical claims stemming from the tragedy. The PSC acts on behalf of individual and business plaintiffs in the Multi-District Litigation proceedings pending in New Orleans (MDL 2179). “From the beginning, BP stepped up to meet our obligations to the communities in the Gulf Coast region, and we’ve worked hard to deliver on that commitment for nearly two years,” said Bob Dudley, BP Group CEO. “The proposed settlement represents significant prog- ress toward resolving issues from the Deepwa- ter Horizon accident and contributing further to economic and environmental restoration efforts along the Gulf Coast.” BP estimates that the proposed $7.8 billion BP has agreed to a settlement with the group associated with the Gulf Coast region settlement will be paid from a $20 billion trust, affected by the 2010 Deepwater Horizon oil spill. (Photo courtesy of BP p.l.c.) which was established to satisfy claims arising from the oil spill. The settlement includes a commitment of $2.3 billion to help resolve economic loss related to the accident and oil spill. Other costs to be paid claims related to the Gulf seafood industry. from the Trust include state and local government claims, Prior to the proposed settlement, BP had spent more than state and local response costs, natural resource damages and $22 billion toward meeting its commitments in the Gulf. BP related claims, and final judgments and settlements. It is not has paid out more than $8.1 billion to individuals, businesses possible at this time to determine whether the $20 billion and government entities. In addition, BP has spent approxi- Trust will be sufficient to satisfy all of these claims as well mately $14 billion on operational response. as those under the proposed settlement. Should the Trust This proposed settlement is not expected to result in any not be sufficient, payments under the proposed settlement increase in the $37.2 billion charge (which included the would be made by BP directly. $20 billion charge taken in respect of the trust) previously The proposed settlement does not include claims against recorded in BP’s financial statements. BP’s current expecta- BP made by the U.S. Department of Justice or other federal tion is that the provision for litigation and claims, which in- agencies (including under the Clean Water Act and for Natu- cludes the claims covered by this proposed settlement, will ral Resource Damages under the Oil Pollution Act) or by the increase by approximately $2.1 billion with no net impact states and local governments. The proposed settlement also to either the income or cash flow statements, because this excludes certain other claims against BP, such as securities and is a settlement that is expected to be payable from the Trust. shareholder claims pending in MDL 2185, and claims based The amount that can be further provided with no net impact solely on the deepwater drilling moratorium and/or the re- to the income statement therefore is expected to be reduced lated permitting process. from approximately $5.5 billion to approximately $3.4 bil- The proposed settlement is comprised of two separate lion. While BP has sought to reliably estimate the cost of agreements, one to resolve economic loss claims and another this proposed settlement, it is possible that the actual cost to resolve medical claims. Each proposed agreement provides could be higher or lower than this estimate depending on that class members would be compensated for their claims the outcomes of the court-supervised claims processes. In ac- on a claims-made basis, according to agreed compensation cordance with its normal procedures, BP will re-evaluate the protocols in separate court-supervised claims processes. The assumptions underlying this estimate on a quarterly basis proposed agreement to resolve economic loss claims includes as more information, including the outcomes of the court- the financial commitment for the Gulf seafood industry and supervised claims processes, becomes available. a fund to support continued advertising that promotes Gulf The trust was established to satisfy not only legitimate in- Coast tourism. dividual and business claims but also a number of other costs The proposed agreement to resolve medical claims involves

8 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com payments based on a matrix for certain began operating in August 2010, and we thank him and his team for their currently manifested physical conditions, dedication and professionalism,” said Mr. Dudley. “During Mr. Feinberg’s as well as a 21-year medical consultation tenure, BP has paid approximately $6.1 billion to resolve more than 220,000 program for qualifying class members. It claims from individuals and businesses through the GCCF.” also provides that class members claim- Payments in class action settlements typically are not made until after final ing later-manifested physical conditions approval of a settlement, but BP has agreed not to wait for final approval of the may pursue their claims through a media- economic loss settlement before claims are paid. The economic loss claims pro- tion/litigation process. Consistent with its cess will continue under court supervision before final approval of the settle- commitment to the Gulf, BP would also ment, first under the transitional claims process, and then through the settle- provide $105 million to improve the avail- ment claims process established by the proposed economic loss agreement. ability, scope and quality of healthcare in “This settlement reflects our commitment not only to the Gulf region, but Gulf communities. This health care out- also to the United States as a whole,” Dudley said. “BP has operated in Amer- reach program would be available to all ica for more than 100 years, employs nearly 23,000 people in the U.S., and individuals in those communities, regard- invests more in the U.S. than in any other country.” less of whether they are class members. It would include expanding capacity to address community health needs, including primary care, mental health services and access to environmental health specialists, as well as enhanced training and education related to Gulf Coast health issues. Under the proposed settlement, class members would release and dismiss their claims against BP. The proposed settlement is not an admission of liability by BP. The proposed settlement also provides that, to the extent permitted by law, BP will assign to the PSC certain of its claims, rights and recoveries against Transocean and Halliburton for damages not recover- able from BP. The proposed settlement is subject to reaching definitive and fully-documented agreements within 45 days, and if those agreements are not reached, either party has the right to terminate the proposed settlement. Once there are definitive and fully-documented agreements, BP and the PSC would then seek the Court’s prelimi- nary approval of the settlement. Under federal law, there is an established procedure for determining the fairness, rea- sonableness and adequacy of class action settlements. Pursuant to this procedure, and subject to the Court granting pre- liminary approval of both agreements, there would be extensive outreach to the public, including through advertisements and direct mail, to explain the settlement agreements, class members’ rights, including the right to “opt out” of the class- es, and the processes for making claims. The Court would then conduct fairness hearings at which class members and various other parties would have an opportunity to be heard and present evidence. The Court would then decide whether or not to approve each proposed settlement agreement. The proposed economic loss settlement provides for a transition from the Gulf Coast Claims Facility (GCCF) ad- ministered by Kenneth Feinberg. “Ken Feinberg has overseen the GCCF since it napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 9 PLCA Announces New President at Annual TransCanada Launches Open Season for Convention Keystone Hardisty Terminal Dan Murphy of Precision Pipeline was introduced as the The Keystone project continues to move forward north of new president of the Pipe Line Contractors Association the border, as TransCanada Corp. launched an open season (PLCA) during the association’s 64th annual convention, to obtain binding commitments from interested parties for Feb. 21-25, at the Park Hyatt Aviara, in Carlsbad, Calif. the Hardisty Terminal, which will be located at the major PLCA represents the mainline oil and gas contractors from crude oil terminal hub in Hardisty, Alberta. across the United States. Their annual meeting is always The proposed project is an aboveground, 2 million bar- well attended and this year was no exception with more rel crude oil batch accumulation terminal with tankage and than 550 conventioneers. pipeline infrastructure that could be expanded subject to the level of interest received in this open season. The proposed project will provide new infrastructure for Western Canadian producers and access to the Keystone Pipeline System. Following completion of the open season, which closes at 12 p.m. (Mountain) on March 22 and subject to receipt of sufficient contractual commitments from shippers, Trans- Canada intends to proceed with the necessary regulatory applications for approvals to construct and operate the terminal. Subject to regulatory approvals, the project is expected to be in-service by early 2015. The Keystone Pipeline System is an operational 3,461-km (2,151-mile) pipeline that is delivering over 500,000 barrels per day of Canadian crude oil to U.S. Midwest markets and Cushing, Okla.

TransCanada Also Announces New Independent Director 2012 PLCA board of directors. The board of directors of TransCanada Corp. has appoint- The 2011 PLCA president was Chris Leines, of Minnesota ed a new independent director, Rick Waugh, effective Feb. 1. Ltd., and he was the focal point of this year’s convention. “We are extremely pleased to have Mr. Waugh join the Leines and his wife Wendy were the hosts at many of the board of directors to help TransCanada continue to grow events. Leines reported in 2011 that 3,037 miles of new and realize our ambitious growth plans,” said Barry Jackson, pipeline were constructed. Plus, 722 miles of pipelines were chairman of TransCanada. “We look forward to drawing on tested. The construction value was $3.82 billion. This was his extensive experience and knowledge in the areas of bank- a 45 percent increase in miles compared to 2010 and an 11 ing, international markets and organizational leadership.” percent increase in revenue. Waugh has been the president, CEO and a director of the Every other year, an auction is held by Ritchie Bros. This Bank of Nova Scotia (Scotiabank) since March 25, 2003. He was the case this year, and Butch Graham of Ritchie Bros. began his career with Scotiabank as a branch employee in was the auctioneer and emcee. The auction raised $500,000, 1970 and worked in increasingly senior roles until 1985, when followed the next day by an additional $100,000 donation, he moved to New York as Scotiabank’s most senior executive for a total of $600,000. At the convention, PLCA awarded 20 in the U.S. Subsequently, he was vice chairman of corporate four-year scholarships at $8,000 per year to PLCA members. banking from 1995 to 1998 and vice chairman of international This year, Steve Ford of the Wall Street Journal and the banking and wealth management from 1998 to 2003. Fox Business Network, discussed positive prognostications Waugh is a member of the Canadian Council of Chief for pipelines during a business session. He particularly fo- Executives. He currently serves as president and is a director cused on the Keystone XL pipeline, which the Obama ad- of the International Monetary Conference (IMC) and is vice ministration had recently denied. The Keystone project was chair of the board of the Institute of International Finance a hot topic throughout the convention. (IIF). Waugh is a member of the Council of the Americas The Annual Banquet and Floor Show featured coun- and is on the Chairman’s International Advisory Council try and western entertainer Jake Owen. At the banquet, for the Americas Society. He serves on the board of directors along with Murphy being introduced as the 2012 presi- for Catalyst Inc. and is chair of the Catalyst Canada Advi- dent, the PLCA also announced John Allen, of Pipe Line sory Board. In addition, he serves on the advisory council Constructors, as 2012 first vice president; Ronnie Wise, of the Schulich School of Business at York University, the of Price Gregory Guanghua School of Management at Peking University and International, as the Canadian Museum of Human Rights. second vice presi- Waugh has long been active in several philanthropic or- dent; and Frank ganizations, including the United Way of Greater Toronto, Welch, of Rockford where he was campaign chair in 2006. He is also a member Corp. as treasurer. of the board of the MS Society of Canada’s Multiple Sclero- The 2013 PLCA sis Scientific Research Foundation. Waugh is a director of St. Convention will Michael’s Hospital and was co-chair of the hospital’s cam- be held Feb. 12- paign to build the Li Ka Shing Knowledge Institute. 16, at the Hyatt Waugh holds a bachelor of Commerce (Honors) degree Regency at Gainey from the University of Manitoba and a Master of Business Three’s company: Chris and Wendy Leines Ranch in Scotts- Administration from York University. He is also a Fellow of with Steve Ford (center). dale, Ariz. the Institute of Canadian Bankers and has been awarded

10 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com Honorary Doctor of Laws degrees from related Marcellus shale well drilling impacts were factually grounded and legally York University and Assumption Univer- sound under applicable court precedent. He also detailed for the court the substan- sity. tial harm that continuation of the stay would impose on the MARC I project and on CNYOG, which stood to lose as much as $80 million and potentially faced the Court Rules in Favor of failure of the project altogether unless the stay was lifted. Marcellus Shale Pipeline Later that same day, the Second Circuit denied the emergency motion and Thanks to the efforts of the law firm vacated its earlier emergency temporary stay. As a result of Dewey & LeBoeuf’s Dewey & LeBoeuf, a $257 million pipe- efforts, CNYOG’s construction of the MARC I pipeline may now resume. line project in the Marcellus shale is Husch Blackwell LLP served as co-counsel to CNYOG. cleared to move forward. The Dewey & LeBoeuf team included partners James F. Bowe Jr. and Alessi, Dewey & LeBoeuf helped secure a sig- and associates Jeffrey D. Kuhn and Gregory G. Nickson. Dewey & LeBoeuf is a nificant victory in the U.S. Court of Ap- full-service global law firm, providing legal counsel throughout the Americas, peals for the Second Circuit for Inergy LP Europe, Russia/CIS, the Middle East, Asia and Africa. and its subsidiary Central New York Oil and Gas Co. LLC (CNYOG) in the case, which clears the way for the development of the project. Upon completion, the pipeline will transport natural gas produced in Pennsylvania’s Marcellus shale, one of the nation’s largest known natural gas supply resources, to several major interstate pipelines. On Feb. 14, various environmental groups, led by the Sierra Club and its counsel, Earth Justice, filed a petition in the Second Circuit to overturn Federal Energy Regulatory Commission (FERC) orders authorizing CNYOG to construct and operate a 39-mile interstate natural gas pipeline in north-central Pennsylva- nia known as the MARC I pipeline. The purpose of the MARC I pipeline is to provide much-needed access to interstate markets for natural gas to be produced from the Marcellus shale. Petitioners alleged that FERC violated the National Environmental Policy Act (NEPA) by approving the MARC I pipeline without considering the environmental impacts of Marcellus shale well drilling and associated infrastructure development. FERC had concluded that NEPA did not require it to analyze environmental impacts related to Marcellus shale well drilling because those activities are outside its juris- diction and are not readily evaluated other than in a general manner given the many uncertainties involved. The petitioners re- quested an emergency stay of construction and tree clearance activity for the proposed interstate pipeline pending further review of the court. That emergency stay was granted by the Second Circuit on Feb. 17, and with it, all construction work on the MARC I project was suspended. CNYOG successfully intervened in the Second Circuit proceeding, and oral argu- ments on the emergency motion for stay were held before a three judge panel in the Second Circuit courthouse on Feb. 28, during which Dewey & LeBoeuf partner Robert J. Alessi argued on behalf of CNYOG. In his argument, Alessi pointed the court to extensive record support for FERC’s determi- nation that its environmental review of the napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 11 Early Sales Hit Record High for PDI INGAA: Pipeline Capacity Important Concern Accounting Book for Gas-Electric Integration During its first In response to a new rule proposed by the U.S. govern- month of be- ment, the natural gas industry is stressing the importance ing released, the of pipeline capacity. Don Santa, president and CEO of the energy industry Interstate Natural Gas Association of America (INGAA), reference book released a statement in response to discussion at the U.S. “Petroleum Ac- Federal Energy Regulatory Commission (FERC) meeting counting: Princi- on gas-electric reliability. ples, Procedures, “We appreciate FERC’s increasing recognition of the im- & Issues” has portance of natural gas-electric power integration, and its sold and shipped acknowledgment that this is a complex issue that likely nearly half of its will require a multi-year initiative,” Santa said. “We agree first printing. and urge FERC and the North American Electric Reliability The seventh Corporation to take a leadership role in promoting solu- edition of the tions. Industry negotiations, however earnest, seem un- book is selling likely to achieve desired results without the guidance that quickly thanks these regulators can provide.” to the demands FERC’s proposal includes provisions that support coor- from within the dination between the natural gas and electric industries, industry, according to Dennis Jennings, director of energy standards for pipeline postings of information regarding programs for the Professional Development Institute (PDI). waste heat, and general revisions to the standards designed “Energy professionals must understand how and from to allow more efficient processing of wholesale natural gas where the financial numbers they deal with every day are transactions. generated,” Jennings said. “This book provides the answers With respect to the standards regarding coordination they need.” between the natural gas and electric industries, the new Completely updated from previous versions, “Petroleum standards provide public utilities and other shippers with Accounting: Principles, Procedures, & Issues” features es- clear identification of changes in the pipelines’ system sential industry accounting and reporting changes, Jen- conditions by creating 15 new notice types posted on the nings added. pipelines’ websites and disseminated through email, ac- The seventh edition not only covers industry accounting cording to a FERC statement. The new notice types inform and reporting changes and updates from the SEC, FASB, EITF shippers and interested parties of intraday bumps, opera- and the IRS, but also tackles many recent developments affect- tional flow orders and other critical notices. The use of ing all energy professionals, including: these additional notice categories should enable shippers • The SEC’s release on Modernization of Oil and Gas Report- to more quickly identify changes in pipeline conditions by ing, and FASB’s compliance amendments; enabling them to filter pipeline notices more efficiently. • FASB’s release of standards covering issues such as fair val- “Determining the amount of pipeline capacity needed ue and business combinations, all relative to oil and gas to ensure electric reliability — and who will hold and pay companies; for that capacity — are the central questions that must be • Explosive growth in unconventional oil and gas produc- addressed,” Santa said. “The rules governing wholesale tion methods; power markets will need to be reconciled with these de- • Extreme fluctuation of oil and gas prices; terminations. The interstate natural gas pipeline industry • Regulations resulting from recent incidents affecting the has a proven track record of building infrastructure and environment and worldwide financial crises; and providing services when the needs of the market are ex- • Political issues affecting the industry worldwide. pressed by customers willing to reserve and pay for pipeline capacity. “We’ve been pleased with the initial feedback received from “While there is merit to addressing opportunities for purchasers of the seventh edition,” said PDI President Ken improving communications and scheduling, it is unre- Robertson. “In particular, buyers have singled-out topics such alistic to believe that these efforts alone will ensure that as derivatives accounting, risk management and retirement natural gas generators can operate reliably under any cir- obligations with high praise.” cumstances.” The book is available for immediate distribution, selling for $225, plus applicable shipping and tax. Copies may be or- ROSEN Awarded Longest Offshore Inline dered through the website at www.petroleumaccounting.org. Inspection Project in U.S. History In addition, “Petroleum Accounting: Principles, Procedures, ROSEN was awarded & Issues” is accompanied by a compact disk, which provides an inline inspection a convenient means of research for forms, regulations and (ILI) project that lands often-used reference tools. the company in the re- The Professional Development Institute, located at the Uni- cord books yet again. versity of North Texas, is a 501(c)(3), not-for-profit education The offshore in-line in- corporation that provides versatile, innovative, cost-effective spection of the 36-in. training programs to professionals worldwide. PDI is recog- segment of the Gulf- nized as the world’s leading provider of oil and gas accounting stream pipeline will be ROSEN will inspect a 429-mile subsea education as well as training programs for virtually all profes- the longest offshore in- pipeline, making it the longest inline sional services areas. line inspection in U.S. inspection project in U.S. history.

12 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com history, stretching 429 miles across the field (TFI) MFL technology of Intratech Inline Inspection Services Ltd. Gulf of Mexico. With circumferential MFL inspection technology, Baker Hughes Process Previously, ROSEN was the first to and Pipeline Services group can assist operators with locating specific pipe- inspect the Langeled Pipeline System line seam threats, such as hook cracks, lack of fusion and long narrow-axial spanning from Nyhamna, Norway, to corrosion. The circumferential MFL technology will now be produced in Easington, U.K., which until 2011 was the larger diameter pipeline sizes, complete with speed control and inertial the world’s longest subsea pipeline navigation capabilities. (729 miles, 42- and 44-in. diameter). For more than two decades, Baker Hughes’ pipeline inspection servic- The Gulfstream Pipeline System is a es have partnered with pipeline operators to manage integrity threats in multi-diameter pipeline that begins in liquid and gas pipelines, both onshore and offshore. The circumferential Alabama and Mississippi, then crosses MFL technology now complements the Baker Hughes pipeline integrity the Gulf of Mexico into Florida. The products, including solutions for mechanical damage, metal loss, cracking, natural gas pipeline began construc- bending strain, geospatial location and corrosion detection. tion in 2001 and became the first interstate pipeline to cross the Gulf. The pipeline, operated by Williams, is a 50/50 partnership with Spectra En- ergy. Gulfstream is a strategic natural gas asset for the state of Florida and a vital part of meeting their residential and power needs. The project will be completed in three phases: cleaning services, deformation assessment and combo ILI inspection. To date phase one, the cleaning and gauging pig inspections, have been successful, verifying that results are within the required tolerances for proceeding with the geometry ILI tool. The final inspection phase will include ROSEN’s combination ILI tool consisting of high-resolution magnetic flux leakage (MFL) and geometry technologies. The configuration will also include a ROSEN Speed Control Unit (SCU). The SCU stabilizes tool velocity during the run to ensure optimal magne- tization and data quality. During the cleaning and gauging phase of the project a ROSEN Pipeline Data Logger (PDL) was used to measure and record temperature and pressure profiles, detect and located pipe restrictions, and monitor tool behavior. The additional data gained by using the PDL was especially beneficial given the extreme offshore pipeline environment, and because it had not been previously inspected using ILI technology.

Baker Hughes Expands Pipeline Inspection Services Baker Hughes has broadened its pipeline service portfolio to include circumferential magnetic flux leakage (MFL) inspection technology, which enables pipeline operators to identify anomalies in pipeline long seams and more effectively manage the risk associated with cracks in long seam welds and the overall integrity of their pipeline assets. Baker Hughes recently acquired the assets and circumferential/transverse napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 13 DCA Hangs 10 in Hawaii feature hands-on, outdoor workshops, as well as 85 exhibits The Distributions Contractors Association (DCA) held its 51st featuring the latest products and services for corrosion protec- annual convention at Fairmont Orchard Resort on the Kohala tion, instrumentation, materials and pipeline services. Coast on the “Big Island” of Hawaii. The turnout for the con- Licensed professional engineers may earn professional de- vention included more velopment hours for attending AUCSC. Engineers should sub- than 330 attendees. mit proof of their completion of AUCSC courses to their state DCA’s strategic plan engineering licensing board. Additionally, students may earn has it focusing on in- Continuing Education Units (CEUs) from West Virginia Uni- creasing on the num- versity. CEU application forms are available at the Operations ber of regular mem- Desk during AUCSC registration. A NACE Technician Review bers. DCA’s contractor Course and the NACE Corrosion Technician Exam are offered, member profile is very and AUCSC course hours may be applied toward NACE recer- specific. “Any contrac- tification requirements. tor engaged in the con- Advance registration for the entire AUCSC 2012 program is 2012 DCA board of directors. struction and mainte- $125, and onsite registration is $155. Those interested in at- nance of distribution tending should call (304) 293-4307 or email [email protected]. pipelines and underground utilities.” At the end of 2011 DCA’s edu for more information. Registration is also available online. regular members has increased to 59. On the associate member side, 2011 ended with 94 members. Audubon Engineering Achieves a Million Safe DCA conventions have a fine blend of business, networking Man Hours for 2011 and fun. This year’s convention was chaired by Greg Dahl, of Safety first! Audubon Engineering is proud to announce that ARB Inc., DCA’s 2011 president. There were numerous com- its employees have worked more than 1 million safe man hours mittee sessions ranging from the Safety Committee, HED in 2011 and have gone 14 years without a recordable injury. Committee, Membership Committee and more. A featured “To reach a million safe man hours without a recordable inci- speaker at one of the sessions was Chris Daum, of FMI Capital dent or injury this past year is not only an outstanding achieve- Advisors, who discussed his economic forecast for the gas dis- ment for our employees, but also marks a significant milestone tribution industry. for Audubon Engineering and its phenomenal growth,” said The major network- Chris Watford, director of health safety and environment (HSE) ing events included a for Audubon. “While Audubon Engineering has had ‘zero re- Caterpillar Welcome cordable incidents’ since the company’s inception, this is the Reception, a Case Key- first time we’ve worked enough hours to qualify for a million note Breakfast, a Vacu- safe hours in one calendar year.” worx Super Bowl Party, Audubon Engineering employees may work in environ- a Volvo Auction Recep- ments that are often harsh and demanding — providing full- tion, a Ditch Witch service project solutions for oil and gas, petrochemical and Members Breakfast, an refining, and power generation industries. Global assignments American Augers Golf Vacuworx sponsored a Super Bowl party can range from offshore and onshore developments, including Outing, a Hammer- at this year’s DCA Convention. From left: engineering, procurement and fabrication (EPF), to design and Head Aloha Breakfast, a Shawn and Cassidy Lowman, Bill Solomon, operational support for large engineering, procurement and Deere/TT Technologies and Beth and Randy Hayes. construction (EPC) projects. President’s Reception The year 2011 also marked additional milestones for the and a Vermeer President’s Dinner. company, including the doubling of its head count during the Ritchie Bros. conducted the 22nd annual auction. Butch Gra- calendar year to 750, as well as being named by the Houston ham of Ritchie Bros. was emcee and main auctioneer. The auc- Chronicle as one of Houston’s “Top 100 Workplaces in Houston” tion raised an amazing $411,000. in which Audubon was listed as ranking No. 16. At the President’s Dinner, Kevin Michels, of Michels Corp., Audubon, founded in 1997, is a full-service, global project assumed the president’s reins for 2012. Tim Bell, of Midwestern solutions provider. It offers the power and flexibility of compre- Contractors, became vice president, and Grady Bell assumed hensive engineering and service disciplines through a unique the position of treasurer. combination of in-house professionals, affiliate companies, and DCA’s mid-year meeting will be July 11-15 at La Posada de industry alliances. Headquartered in Houston, Audubon has Santa Fe Resort & Spa in Santa Fe, N.M. The 52nd annual con- four affiliate companies and 11 offices worldwide. vention will be March 5-10, 2013, at the Lowes Miami Beach Hotel in Miami Beach, Fla. GTI Launches Emerging Technology Program The Gas Technology Institute (GTI), a not-for-profit RD&D Underground Corrosion Training to be Offered organization with a 70-year history of serving the natural gas at WVU industry, has announced the launch of a North American (U.S. The 57th annual Appalachian Underground Corrosion and Canada) industry collaborative to drive the deployment of Short Course (AUCSC 2012) will take place May 15-17, at West energy-efficient emerging technologies and solutions. Virginia University in Morgantown, W.Va. Detailed informa- The Emerging Technology Program (ETP) was developed tion and online registration is available at www.aucsc.com. with significant input and guidance from industry stakehold- The AUCSC offers more than 100 hours of basic, intermedi- ers ensuring that this program will meet the varying needs of ate and advanced training, providing attendees with technical utilities, energy efficiency programs and ratepayers. information about the causes and prevention of corrosion on “We are very encouraged by the interest and engagement by underground structures. the utilities and energy efficiency community — our intention Special topics will focus on pipelines, integrity manage- is to fill a missing gap and explore technologies and program ment, internal corrosion and coatings. The event will also solutions that show the most promise for gas utilities and en-

14 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com ergy-conscious consumers,” said Ryan Kerr, industry. This program is a major step in the right direction.” manager of emerging technologies at GTI, Project opportunities for 2012 include combination space/water heater systems who will head up the new program. for the residential and small commercial sectors, high-efficiency gas heating rooftop The ETP is focused on accelerating the packages for the commercial sector, and a boiler retrofit technology that promotes commercialization and adoption of the latest significant energy and water savings for the commercial and industrial sectors. end use and energy efficiency technologies. “We have a strong foundational base of support from the industry. It’s a great The program is designed to help companies opportunity to join together and accelerate market acceptance of emerging tech- identify and evaluate the most promising nology. The larger the group, the more powerful presence we have, so we aspire products and integrated solutions and assess to add more members and continue to build on the program,” Kerr said. For more their suitability for future use in the market- information, visit the website at www.gastechnology.org/ETP. place. The collaborative will leverage the col- lective intelligence, expertise, and funding NEB Approves Northwest Mainline Expansion of members from the natural gas industry to In a decision issued Feb. 28, the Canadian National Energy Board (NEB) an- help deploy new technologies. nounced its approval of the Northwest Mainline Expansion Project (the project) In the past, many technology solu- submitted by NOVA Gas Transmission Ltd. (NGTL). tions did not have the market impact that The project includes the construction and operation of three new natural gas stakeholders felt that they could. “We saw pipeline loops totaling 111.2 km in northeastern British Columbia and northwest- a lot of good R&D happening, but less of ern Alberta. The pipeline loops would be alongside existing rights of way. a concerted effort to take that technology The $324 million project will link natural gas supplies from the Upper Peace into the marketplace,” Kerr said. “With the River area to markets in Canada and the United States. The board accepts NGTL’s collaborative approach, we’ll be able to ap- submission that there is adequate market demand for the gas to be transported proach national manufacturers and big-box by the project. retailers with a larger voice representing The board is satisfied with NGTL’s efforts in minimizing potential environmental utilities across the U.S. and Canada.” impacts by proposing a right-of-way that is largely alongside existing rights of way. Southern California Gas (SoCalGas), a Should the project be constructed, it would not result in new permanent access roads. natural gas utility serving customers in The NEB’s approval of this project is contingent on conditions that NGTL must Central and Southern California that has meet. The conditions relate to pipeline integrity, the protection of the environ- its own statewide emerging technology ment, protection and monitoring of caribou habitat and matters of public and program in place, was one of the early sup- Aboriginal consultation. porters of the new North American collab- The company is required to submit regular updates to the NEB on consultation orative. “Early on, we identified a need for activities with Aboriginal groups and describe how any concerns were addressed. As a broad effort to foster large demonstra- well, NGTL must provide the NEB with a plan regarding Aboriginal participation in tions to develop program data, to drive construction monitoring. costs down, and to demonstrate to manufacturers and consumers that a particular technology works,” says Abdullah Ahmed, emerging technologies program manager at SoCalGas. “We look forward to working closely with GTI and other natural gas utilities in moving promising emerging technologies into the marketplace.” ETP projects will assess energy use, costs and benefits, marketing opportunities and barriers, and energy savings potential for various products and processes. Plans are to conduct field demonstrations to validate the performance, efficiency, and cost-effective- ness of new technologies and program strategies. “We need larger demonstrations to collect and understand market data, while developing market infrastructure to support eventual technology deployments,” Kerr says. “A key part of developing the market will be building consumer awareness about a given technology within a region and building contractor capacity so that we can establish consumer confidence,” Kerr adds. “This initiative fills an important need for energy efficiency programs at today’s natural gas utilities,” said Bob Fegan, principal energy analyst at DTE Energy, who has been a driving force in launching the collaborative. “As energy efficiency programs mature, emerging technologies will become an even more important component in achieving the energy savings goals of our napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 15 Market Watch Midstream Investment to Bring U.S. Jobs Development Could Generate $511 Billion in Total Output Investment to expand and construct midstream infrastructure to bring natural gas, natural gas liquids and crude oil supplies to markets will support an average of more than 125,000 jobs each year from 2012 through 2035, generate nearly $57 billion in federal, state and local tax revenue, and add more than $511 billion in total economic output, according to a new study. The report, “Jobs & Economic Benefits of Midstream Infra- structure Development: US Economic Impacts through 2035,” conducted by Black & Veatch on behalf of the INGAA Foun- dation, finds that the $200 billion in projected investment midstream infrastructure through 2035 will result in significant benefits for the U.S. economy in the near term and the long run. Economic benefits are shared by all regions across the United States and are felt throughout the study period. In the near term, the study projects an average of nearly 160,000 jobs will be supported in both 2012 and 2013 and an average of over 135,000 jobs will be supported from 2012 through 2016. “This study demonstrates the importance of midstream infrastructure in terms of jobs and economic benefits,” said INGAA Foundation president and CEO Don Santa. “In addition to creating a consistent stream of construction jobs, this investment also supports operations and management positions, which are higher paying compared with average national wages. This midstream investment also helps local economies as well as federal, state and local governments.” Santa, also president and CEO of the Interstate Natural Gas Association of America, said the new study analyzes neither the economic impacts from exploration and production activities nor the impacts on households and manufacturers that will benefit from lower natural gas, oil and NGL prices. A number of reports have sought to quantify those economic impacts, he noted. “The important thing to remember is that the benefits of increased domestic natural gas, oil and NGL production only can be realized through the development of midstream infrastructure,” Santa explained. “Pipelines serve as the indispensable link between production and markets.” Graphs courtesy of INGAA The new report is based on data compiled in the INGAA Foundation’s “North American Midstream Infrastructure (approximately 7 percent) accounted for the remainder of the Through 2035 — A Secure Energy Future” study, completed economic impacts. by ICF International in 2011. That study projected capital re- According to the new report, natural gas midstream invest- quirements, in 2010 dollars, for North American natural gas, ment and the investment to operate and maintain the pipe- NGL and oil midstream infrastructure, which includes main- lines will support an average of over 103,000 jobs each year lines, laterals, processing, storage, compression and gathering from 2012 through 2035, generate nearly $47 billion in fed- lines. In the new INGAA Foundation study, Black & Veatch eral, state and local tax revenue, and add more than $420 bil- converted the capital investment projections to 2011 dollars, lion in total economic output. In the near term (2012 through limited the scope of investment to only Lower 48 U.S. and 2013), midstream natural gas investment will support an av- offshore Gulf and calculated the jobs and economic impact erage of nearly 99,000 jobs per year, generate $3.7 billion in of the investment. federal, state and local tax revenue and $34.2 billion in total Because natural gas midstream represents the large major- economic output. In the mid-term (2012-2016), midstream ity of projected investment (83 percent), it also represented natural gas investment will support an average of over 95,000 the largest share of economic benefits in new study. Oil in- jobs a year generate $9.4 billion in federal, state and local tax vestments (approximately 10 percent) and NGL investments revenue and $80.4 billion in total economic output.

16 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com

Listings North American Contributed by Pipeline Project Roundup

The following oil and gas pipeline projects have been Laney Directional Drilling Co. was awarded a contract by announced. Projects are in order of most recent approximate WPX Energy Marcellus Gathering LLC to install 1,000 ft of 16- starting date. All projects are for 2012 unless noted. in. pipeline via directional drilling in Susquehanna County, Pa. Headquarters is on the jobsite. The superintendent is Jimmie Johnson. Approximate start date: Feb. 3. Foltz Welding Ltd. was awarded a contract by Enterprise Products/Pipeline for anomaly work on various systems of 8- to 12-in. pipelines in Pennsylvania, New York, Ohio, Indiana and Laney Directional Drilling Co. was awarded a contract by Troy Illinois. Headquarters is unknown. The superintendent is Joe Construction to install 13,213 ft of 20-in. pipeline via directional Pennington. Approximate start date: March 5. drilling in Bee and San Patricio counties, Texas. Headquarters is on the jobsite. The superintendent is Carlton Loftin. Approximate start date: Feb. 2. Pe Ben USA Inc. was awarded a contract by Evraz Inc. to offload and stockpile 280,000 ft of 30-in. steel pipe in Livingston County, Mich. Headquarters is Howell, Mich. The superintendent Dun Transportation & Stringing Inc. was awarded contracts is Don Bousselot. Approximate start date: Feb. 17. by U.S. Pipeline Inc. for the following: 1) the stringing of approximately 12 miles of 42-in. pipe in Gaston, Rowan and Davison counties, N.C.; and 2) the stringing of approximately Laney Directional Drilling Co. was awarded a contract by 10 miles of 42-in. pipe in Coosa and Randolph counties, Sunland Construction to install 11,150 ft of 6-in. pipeline via Ala. Headquarters for both jobs is in the pipe yard. The directional drilling in Harris County, Texas. Headquarters is on superintendents are Greg Norman and John Zaruba, the jobsite. The superintendent is John Odom. Approximate respectively. Approximate start date for both jobs: Feb. 1. start date: Feb. 15.

Letourneau Products Mfg. Corp. was awarded a contract by U.S. Northern Clearing Inc. was awarded a contract by Enbridge Pipeline Inc. for clearing, grubbing and matting for approximately Energy LLC for integrity digs on 105 miles of 34-in. pipeline in 10.3 miles of 42-in. pipeline in Randolph and Rockford counties, Ogema, Arenac, Gladwin, Roscommon, Delta and Schoolcraft Ala. Headquarters is unknown. The superintendent is Terry W. counties, Mich. Headquarters is unknown. The superintendent Maxon. Approximate start date: Feb. 1. is Jim Putnam. Approximate start date: Feb. 13.

Price Gregory International Inc. was awarded a contract Indianhead Pipeline Services LLC was awarded a contract by Dominion Transmission Inc. to install 58 miles of 8-in. by C.J. Hughes Pipeline to perform foam services on 17.75 pipeline in Brooke County, Ohio, and Marshal County, W.Va. miles of 24-in. pipeline in Wetzel County, W.Va. Headquarters is Headquarters is unknown. The superintendent is Doug New Martinsville, W.Va. The superintendent is Randy Rubenzer. Gregory. Approximate start date: Feb. 1. Approximate start date: Feb. 8.

Sheehan Pipe Line Construction Co. was awarded a ARB Inc. was awarded a contract by Kern River Gas contract by Momentum for the installation of 2.39 miles of 10- Transmission to install 9 miles of 8-in. gas pipeline in San in. pipeline, 14.45 miles of 12-in. pipeline, 49.64 miles of 16-in. Bernardino County, Calif. Headquarters is Primm, Calif. pipeline, 20.34 miles of 20-in. pipeline and 31 miles of 24-in. Superintendent is Terry Cooley. Approximate start date: Feb. 6. pipeline in Harrison, Marion and Monongalia counties, W.Va., and Greene and Washington counties, Pa. Headquarters is in Idamay, W.Va. The Superintendent is Thelbert Barnes. Approximate start date: Feb. 1. Northern Clearing Inc. was awarded a contract by Price Gregory International Inc. for right-of-way clearing of approximately 63 miles of 8- and 24-in. pipelines in Marshall County, Ohio, and Brooke County, W.Va. Headquarters is unknown. The Indianhead Pipeline Services LLC was awarded a contract superintendent is Jim Junker Sr. Approximate start date: Feb. 6. by Precision Pipeline LLC to perform foam services on 38,628 ft of 16- and 20-in. pipeline, 31,680 ft of 16-in. pipeline, 25,120 ft of 20-in. pipeline and 5,000 ft of 10-in. pipeline in Bradford County, Pa. Headquarters is Nichols, N.Y. The superintendent Northern Clearing Inc. was awarded a contract by Sheehan Pipe is Randy Rubenzer. Approximate start date: Jan. 26. Line Construction Co. for right-of-way clearing of approximately 113 miles of 10-, 12-, 16-, 20- and 24-in. pipelines in Harrison, Marion and Monongalia counties, W.Va., and Greene and Washington counties, Pa. Headquarters is unknown. The superintendent is Letourneau Products Mfg. Corp. was awarded a contract Dennis Bergman. Approximate start date: Feb. 6. by Price Gregory International Inc. for clearing, grubbing and matting of approximately 30 miles of 24-in. pipeline in Luzerne County, Pa. Headquarters is Tunkhannock, Pa. The

18 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com superintendent is Claude R. St. Pierre. Approximate start date: Rockford Corp. was awarded a contract by Williams Jan. 23. Midstream for the installation of 7,800 ft of 24-in. pipeline in Susquehanna County, Pa. The headquarters is in Montrose, Pa. The superintendent is Mickey Langston. Approximate Midwest Underground Inc. was awarded a contract by start date: Jan. 16. ONEOK for the installation of 700 ft of 8-in. pipeline via directional drilling in DuPage County, Ill. Headquarters is in Naperville, Ill. The Superintendent is Shaun Tippie. Snelson Cos. Inc. had been awarded a contract by PG&E Approximate start date: Jan. 23. for maintenance and hydro-test work on various sizes of pipeline in Northern and Central California. Headquarters is unknown. The superintendent is Jeff Elliott. Approximate Price Gregory International Inc. was awarded a contract start date: Jan. 16. by Anadarko Petroleum Co. to install various lengths of miscellaneous diameter pipelines up to and including 20- in. pipelines in Loving, Reeves, Ward, Pecos, Winkler, Ector, Laney Inc. was awarded a contract by Troy Construction Crane, Andrews, Midland, Upton, Brewster, Jeff Davis, for road boring on 54.7 miles of 24-in. pipeline in De Witt, Culbertson and Hudspeth counties, Texas. Headquarters Victoria and Jackson counties, Texas. Headquarters is Kermit, Texas. The superintendent is Michael Phillips. is Victoria, Texas. The superintendent is Mike Dobbs. Approximate start date: Jan. 23. Approximate start date: Jan. 12.

Dun Transportation & Stringing Inc. was awarded a contract by California Steel/Energy Transfer for the unloading and stockpiling of approximately 155 miles of 16-in. pipe in Ector County, Texas. Headquarters is in the pipe yard. The Want to see your project here? superintendent is Mike Bruce. Approximate start date: Jan. Send submissions to Associate Editor 20 Brad Kramer at [email protected] with the subject heading “Project Roundup.” Henkels & McCoy Inc. was awarded a contract by Spectra for the off-loading of 11 miles of 36-in. pipe from railcars in Franklin County, Pa. Headquarters is in Chambersburg, Pa. The Superintendent is Richard Hill. Approximate start date: Jan. 18.

Apex Pipeline Services Inc. was awarded a contract by Anterro Resources to install approximately 15,000 ft of 16-in. pipeline in Doddridge County, W.Va. Headquarters is Sedalia, W.Va. The superintendent is Cliff Frymier. Approximate start date: Jan. 16.

Associated Pipe Line Contractors Inc. was awarded a contract by Mark West Liberty Midstream & Resources for the installation of 11,267 ft of 12-in. pipeline in Washington County, Pa. Headquarters is in Washington, Pa. The superintendent is Kevin Berryman. Approximate start date: Jan. 16.

Laney Inc. was awarded a contract by Troy Construction for road boring on 57.2 miles of 20-in. pipeline in San Patricio and Bee counties, Texas. Headquarters is Victoria, Texas. The superintendent is Mike Dobbs. Approximate start date: Jan. 16.

Letourneau Products Mfg. Corp. was awarded a contract by U.S. Pipeline Inc. for clearing, grubbing and matting for approximately 12.1 miles of 42-in. pipeline in Gastonia, Rowan and Davidson counties, N.C. Headquarters is unknown. The superintendent is Mark A. Letourneau. Approximate start date: Jan. 16.

napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 19 Squeal Like a Pig Smart or Not, Pigging Tools Keep Pipelines Squeaky Clean

By Bradley Kramer

20 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com ne story has it that they got their name from the There are four primary reasons to pig a pipeline, ac- Osquealing sound they made when traveling through cording to Larry Payne, market development manager for a pipeline. the Pipeline Services & Pigging Solutions Division at T.D. A more recent story is that the name is an acronym for Williamson, a pig manufacturer and ILI provider based “pipeline inspection gauge.” in Tulsa, Okla. The first reason to pig a pipeline is for And yet another story recounts how balled pig leather cleaning, which provides two benefits: keeping the line was first used in cleaning wooden pipes in the late 1800s. clean allows for better flow, more throughput and better The fact is no one really knows for sure why the tools efficiency, and a clean line also aids in corrosion control. used for cleaning and inspecting pipe are called “pigs,” but Secondly, pigs are used for batching, where two products no one snorts at the notion that these tools are essential in are run through a pipe, such as diesel and gasoline, and managing pipeline integrity. the pipeline operator doesn’t want those products to “Pipelines are safer than airline travel,” says David mix. Third, pigs are used for separation, which is similar Henry, president and owner of Girard Industries, a pig- to batching, wherein an operator has one product in the ging manufacturer based in Houston. “Look at any one line and wants to put something else in. Fourth and fi- given time how many planes are in the air and how many nally, pigs are used for inspection. people are on those planes, probably thousands. There are While pigs are primarily used in oil and gas pipelines, millions of people sitting within a stone’s throw of pipe- they are also used in other industries for such applica- line right now. It’s a safe industry, but there is potential tions as product recovery. “Everyone focuses on oil and for danger. What pigs do is try to mitigate or remove prob- gas, but we sell pigs for the water and wastewater indus- lems in the pipeline.” tries, for chocolate companies, mustards or any industry Pipeline pigs come in all sorts of shapes, materials and con- where they have a big vat of product that they have to figurations, from the very simple urethane pigs to the very move,” Henry says. “There’s a pipeline, if you will, that complex “smart” pigs. These in-pipe tools are used for clean- goes from a large tank to the packaging plant or to a ing, batching, inspection and mapping, to name a few tasks. truck. Everything in between is product, is money. They Typically, the simpler cleaning and batching pigs are a will run a pig through the line to get all the product product purchased by the end-user, pipeline operators or out. Otherwise, that’s money just sitting there. It’s all service providers, whereas smart pigs — aka inline inspec- a cost.” tion (ILI) tools — are more of a service item, owned and In the pipeline industry, however, pigs are becoming operated by specialty companies. a requirement. Industry-specific regulations are forcing

napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 21 pipeline operators to run smart pigs, which for the sake of a successful inspection require a cleaning pig to precede the ILI tool. A 2009 rule by the U.S. Federal Energy Regulatory Commission (FERC) requires all newly built interstate pipelines with diameters of 30 in. or greater to run smart pigs before commencing operation, says Scott Coats, president and CEO of Precision Pigging, a smart pigging service provider based in Tulsa. Because smart pigs can cost upward of $500,000, pre- cleaning a pipeline with conventional pigs is usually necessary to avoid damaging an expensive investment. As concerns about the environment and public safety continue to grow, the impor- The more common explanation for how pipeline pigs got their name stems from the squealing tance of pigs will become ever sound they made traveling through a pipe. The tools would also be covered in muck, much like their more important in the pipe- mammalian counterparts. line industry.

Tidy Pigs Although their mammalian namesakes are known more for their dirtiness, pipeline pigs were first invented as a means to clean. However, both are likely to be seen covered in muck. While stories about using a solid item to run through and clean a pipeline date back to the late 1800s (e.g., balled up pig leather), the modern pigging industry began in the 1940s. T.D. Williamson claims to have invented to first pipeline pig, when in 1943 the company provided pipeline scrapers to clean the War Emergency Pipeline System, a 20- and 24-in. pipeline that carried oil and gasoline to the East Coast to ship to Europe during “Smart” pigs were first designed to locate damage to pipe walls, such as the dent being inspected here. World War II. The company Pigs provide an internal means of measuring the condition of a pipeline. has been on the forefront of the pigging industry ever since, manufacturing a wide men eventually parted ways, and Knapp went on to found array of batching, displacement, cleaning and specialty Knapp Polly Pig Inc. Along with its version of the Polly- pigs, in addition to launching and receiver units and Pig, Girard now manufactures solid cast urethane pigs, passage indicators. steel-body mandrel pigs and spherical pigs, as well as a Girard Industries also has a rich history in pigging. Al- variety of cups, disks and brushes to be used with the dif- though the company was chartered in 1968, its involve- ferent pig configurations. ment in the industry began well before that. In the 1940s Typical customers for pigging manufacturers tend to and ‘50s, company founder Harry Girard, along with busi- be the end-user, whether a major oil and gas company, ness partner Charles Knapp, invented and patented the pipeline operator, municipality, transmission company or “Polly Pig,” an open-cell polyurethane foam pig. The two individual service provider, according to Henry. Pressure

22 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com from governmental regulations has “upped the market” operators a method of seeing the insides of their pipes, and created a larger demand for pigging products. whether for measuring internal damage and corrosion or “It’s brought more of a focus to pipeline integrity and for mapping a system for asset management purposes. keeping pipelines clean,” he says. “We now have regula- These service providers own and operate the smart pig, tions that say you have to test pipes routinely.” providing the pipeline company with the final inspec- Pigs also save pipeline operators money, Girard adds. tion report. Pipelines are dependent on flow efficiency. Before integri- Payne joined T.D. Williamson in 1969, after a career in ty management was the big topic in the pigging industry, the aerospace sector, “filling up rockets to go to the moon,” the talk used to center on how to pump the most product he says. Upon joining the company, his first project was through a pipeline. the research and development involved in designing an “Those concerns are still valid,” he says. “The cheaper ILI tool to go through a pipeline and record information. you can push something through pipeline, the more ef- “The Lakehead Pipe Line Co. in Alberta, now part of ficient your operation.” Enbridge, thought they had a dent, a 4-in. dent, from Flow efficiency and pipeline integrity go “hand in a rock ledge,” Payne recalls of the Kaliper pig’s origins. glove,” Girard says. Without one, you can’t have the other. “We find a lot of stuff today that was put in the pipe- “If you don’t have a clean pipeline, you have contami- lines when they were built, flaws in the pipe, mill defects nants eating away at the pipe wall,” he says. “Having liq- when forming pipe.” uids in a pipeline restricts flow and causes corrosion. You Contractors didn’t like the ILI tool when it first came to keep a pipeline clean to maintain integrity, but you’re get- market, Payne says, because it cost them money. ting the benefit of better efficiency and clean flow.” “We’d run it through the pipeline and have to tell them go fix something,” he says. “But eventually, they The Pig Gets Smart learned to like it because it gave a sense of quality assur- It’s not that conventional pigs are dumb, but smart pigs ance. They could make sure the pipe was nice and round offer a measure of intelligence by providing a measure of and correct.” the inside of a pipeline. The early use of smart pigs even changed the way con- T.D. Williamson introduced the Kaliper pig in 1972 and tractors laid pipe, Payne says. The ILI tools found that virtually sparked a whole new industry. Today, there are the sand bags used to pad pipe laid against a rock ledge dozens of inline inspection companies that offer pipeline would damage the pipe wall when pushed against each

napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 23 other. They learned that the pad had to be filled with non-damaging material or else it could cause a buckle. A dent causes stress risers in a pipe wall that could lead to corrosion or a burst in the pipe wall. T.D. Williamson’s original Kaliper pig would not be considered high-resolution technology today, when the ILI sector features tools that can detect more than just dents, obstructions and pipe wall thickness. Now, smart pigs employ a variety of technologies, such as magnetic flux leakage (MFL) and global positioning systems (GPS), which provide a precise reading on the condition of a pipeline system. “You can run a tool Pipeline pigs will continue to be used more and more in an industry increasingly concerned with safety that runs five different and the environment. types of data,” Payne says. “I tell people the more you know, the more you know. When you line up the Barnett shale in the Southwest and the Bakken shale all the different data layers, it’s amazing what you can on the U.S.-Canada border, companies are using pigs to determine.” keep those lines clean. By providing multiple data sets, an ILI tool can collect “Shale features a lot of heavy liquids, and a lot of liq- and analyze a number of variables at the same time. A uid gets stuck in the low places in a pipeline, and that smart pig can therefore not only tell an operator that cuts down on flow,” Payne says. “In the shale, they’re there’s a dent in the pipe wall, but the exact quadrant on pigging more frequently, sometimes daily.” the pipe and the exact coordinates along the pipeline. With the increased use of pigs to keep liquids out of Precision Pigging, which has been in business since pipelines, Payne sees a move toward automation in the 1999, provides smart pigging services using a geometry future to offset the costs of man hours associated with tool, aka a deformation tool, which “measures anything routine pigging operation. that changes a pipeline’s roundness,” Coats says. The Other drivers in the market include government regu- tool records pipe ovality, finding buckles and dents in lations and international pipeline construction. pipe walls. “What we’re doing in the United States is migrating to Because of regulations that force operators to run smart the rest of the world,” Payne says. “We’ve been building pigs before commissioning a new transmission pipeline, pipelines since the 1920s, so our pipelines are old. Other Coats says the majority of Precision Pigging’s business countries have much newer pipelines, so there are op- comes from new construction. Regulations could soon portunities internationally.” require the inspection of distribution and gathering Concerns about the environment and public safety con- lines as well, which will open up a new avenue of busi- tinue to grow across the globe. The necessity of pigs will ness for ILI companies. become increasingly important to the pipeline industry. “Inspection ensures pipelines against third-party dam- “If you think about it, aging pipelines and existing age,” Coats says. “Once a pipeline is laid, there’s less pipelines, that’s the pigging market,” Payne says. “We’re chance of a dent happening on the bottom of the line. It building more and more pipelines and that expands the comes down to safety.” market. The other thing driving up the market is governmental regulations driving need for ILI. You have to Pigging in the Future have a clean pipe to ILI, which means the use of more The development of shale oil and gas reserves has be- cleaning pigs. The market is trending up.” come a new market driver for pipeline pigging, Payne says. With a new network of pipelines cropping up to Bradley Kramer is associate editor of North American Oil & Gas access such areas as the Marcellus shale in the Northeast, Pipelines. Contact him at [email protected].

24 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com

To Rent or to Buy? Some Guidance About Equipment in Today’s Pipeline Industry

By Karma Newberry

There’s an old saying: if it flies or floats, rent it. No one wants to spend summer vacation waiting at the repair shop for his or her boat. That’s why many people rent a boat and leave the maintenance and repair worries behind. Well, in today’s pipeline construction environment, the same principle can apply to many types of specialty pipeline equipment.

Valuable time and money can be wasted procuring, mov- 2. Alternatively, imagine a family who vacations each ing and maintaining equipment while renting provides a year at Lake Powell and likes to stay on a houseboat. cost-effective alternative. Not only is equipment delivered Instead of buying an expensive houseboat, they opt on-site ready to use, but there’s peace of mind that also to rent. Renting guarantees the boat is always ready comes with professional repairs and calibration. In addi- to go, clean and safe. They also have more cash in tion, there is no time lost while equipment is out for re- the bank for other needs throughout the year and pairs or being shipped from one project to the next. the peace of mind that comes with not having to worry about such large investment. The rental com- Consider the following examples: pany takes care of all of the logistics and costs re- 1. A new 42-in. capacity lowering-in cradle may cost garding maintaining and servicing, as well as secur- around $36,000 to purchase. The same lowering-in ing and storing the boat. cradle can be rented for $3,200 per month. A shorter duration job such as integrity work or a directional Given the changing landscape of the pipeline industry drill may last only two to four weeks. Now factor in and its increased complexity, renting or buying decisions wear and tear, and renting begins sounding like a good have in many ways become more clear-cut. In making choice. With the additional time needed to maintain these decisions, an organization must consider everything and safely store this expensive piece of equipment, from equipment requirements and expected utilization, to companies need to ask if purchasing this equipment resource requirements to manage and maintain pipeline will save money or just cause more headaches. equipment, and finally availability and accessibility needs.

26 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com The More Complex Pipeline Business Pipeline work is becoming increasingly more complex, less predictable and geographically diverse. The nature of the work has changed from large, long-term projects to multiple, shorter term and more varied jobs. It is not un- common for companies to manage several jobs across the country, at the same time with pipelines that range from 3 to 42 in. in size. Due to expansion in shale plays and increased integrity work, companies today are also following work to a wider geographic area than ever before. This has made managing equipment and supply costs for projects even more important, and has added a lot of complexity as well. Critical time and money can be lost trying to get the right equipment to the right job in the right place at the right time. That is why it’s important to ask if renting is the right answer for the next project. Renting vs. buying is a complicated question. Here are some important questions that may save both time and money when making this critical decision: • What specialized skills are required to maintain and repair the equipment if purchased? • Where will the equipment be stored when it’s not The geographic expansion of the oil and gas industry, particularly on-site? in the various shale plays, along with increased integrity work, has • Is this equipment specific to this project or will it made managing equipment and supply costs for projects more be used again and again? important than ever before. • How much does it cost to ship this equipment from one job to the next? • How long will it take to recoup the cost invested in • Is this same piece of equipment needed on-site and this piece of equipment? two jobs at the same time? • How does purchasing vs. renting affect cash flow?

napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 27 The choice of whether to rent or purchase multiple pieces of the same equipment can affect cash flow and increase maintenance costs for pipeline companies with multiple projects happening at the same time.

The answers to these questions are why many compa- pairs, storage and the personnel required to perform the nies are opting to rent specialty equipment rather than recalibration and maintenance, especially when it may not purchase. be used for another project right away. The shift we’re seeing in the nature of pipeline work Consider Equipment Needs from large, long-term projects to multiple small projects It doesn’t always make sense to buy a piece of equipment often requires the same equipment at the same time. In and then transport it across the country, pay for costly re- other cases you may need more specialized equipment but

28 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com

only for limited or one-time use. Renting specialty equipment has become Review Equipment Resources the more economical choice for many pipeline construction companies. It Requirements and Hidden eliminates the need to buy equipment that won’t end up paying for itself in Costs the long run. Renting can remove some of the on- For pipeline companies with multiple projects happening at the same going responsibility of maintaining time, it can make it necessary to either choose to rent, or purchase mul- expensive equipment. There are many tiple pieces of the same equipment, which can affect cash flow and in- moving pieces involved in keeping a crease maintenance costs. Opting to buy forces companies to choose project on track so that it will come between buying duplicate pieces of equipment, and waiting until one in on-time and on-budget, and today job is complete before shipping it to the next job. Many pipeline con- project managers are being asked to struction companies are often very happy to off-load the complexity manage more and more projects at the and management of pipeline rental equipment particularly where cali- same time. Owning specialty pipeline brations and regular maintenance are required. equipment means the additional responsibility of managing its repair calibration, delivery, storage and security at several different projects. Time lost to repair or deliver equipment can be costly, especially for shorter duration projects. It is important to consider the real costs of purchasing equipment. There are initial costs like the purchase price and shipping, but there also may be long-term costs associated with repair that make owning the wrong answer. Keeping personnel costs down is important when managing successful pipeline projects. It can become expensive to employ the specialists needed to calibrate and repair different types of equipment at a number of jobsites. The nature of pipeline work will continue to change as our country’s energy demands and infrastructure needs are constantly evolving. Hav- ing the right supply partner is critical to meeting these demands. Many pipeline construction companies today must manage multiple projects in different regions at the same time, and rely on partners to provide quick delivery of the needed supplies or equipment to keep projects running smoothly and safely. PSS Companies offers multiple distribution centers at key locations across the United States to ensure customers receive supplies more quickly. Experienced PSS Compa- nies employees understand the unique needs of maintaining specialty equipment, which makes renting a great choice for construction companies not wanting another item to manage.

Karma Newberry is vice president of sales and marketing for PSS Compa- nies, a supplier of consumable pipeline materials and specialty equipment for the pipeline industry in North America.

30 North American Oil & Gas Pipelines | MARCH MARCH 2012 2012 napipelines.com Talent Search

Seeking a New Generation of Workers in the Oil and Gas Industry

By Sylvia Vorhauser-Smith

omplex challenges are nothing new for companies in the oil and gas industry that are well-ac- Ccustomed to extracting limited resources from remote locations. Yet, the industry is facing a new challenge. There is a global, industry-wide shortage of one of the key resources these companies need

for sustainable growth: talent. As the older members of the workforce retire, the oil and gas industry is

left with an insufficient pool of young employees to step in and take over leadership roles. What results is a fierce competition for talent from all structural misalignment between the current skills of the over the world. To attract entry-level employees, com- workforce and the skills required for the future. panies are offering higher salaries than ever to make Organizations have tried to compensate for this prob- their jobs more appealing. But this technique doesn’t lem by engaging with the education sector to attract stu- get to the heart of the problem –today’s college gradu- dents to the industry and work to define the skills that ates and entry-level workers are looking for more than students will need for its occupations. Many companies just high salaries. have also implemented global rotation programs for The new generation wants careers with opportuni- those younger workers already in the industry, aimed at ties for advancement and continuous development. As preparing them for future leadership roles. These allow the industry is looking for young talent to stay with the younger employees to learn about the different oppor- company and take over leadership positions as older tunities in the industry and to develop a broad base of workers retire, the needs of employees and employers skills across different countries and regions. indeed match up. However, organizations must do a bet- While a rotational program is a step in the right direc- ter job of presenting the great opportunities available to tion to developing future leaders, such programs don’t new workers in the industry. The companies that align provide companies with the insight necessary to deter- their needs with those of this new generation of worker mine which employees show the most promise. With- through cutting edge recruitment strategies and tapping out a way to measure their potential, companies won’t the global talent pool will be best suited for successfully have the analytics about their employees to determine filling their key talent gaps. who is best suited for filling in the key leadership positions as they open up. Organizations that embrace tal- Why the Gap Exists ent management and acquisition technology in their The serious talent shortage is caused by the “camel- recruitment strategy, however, will be better able to an- back” structure of the industry. It is currently comprised alyze their current workforce, determine the gaps that of a large number of workers over the age of 50, a lack need to be filled and put the most qualified people into of those in the 30-50 age range and a small but steady these roles. supply of younger workers. Although the number of entry-level employees continues to trickle in, there are Using Talent Management Technology not enough in this group to compensate for the lack In order to properly leverage the global talent pool, of mid-level employees and to take over the openings companies will need an integrated system for talent ac- left by the retiring workforce. What results is a serious quisition that helps them accurately assess the skills of future employees and tie this information in with their business needs. Ad- ditionally, such recruiting technology is essential for companies operating in multiple countries, as these organizations need a dynamic system in place for recruiting, hiring and managing talent across borders. A technology-based talent management solution is also useful in developing a strategy for retaining qualified employees through career planning and ongoing development. Showcas- ing possible career paths and the skills needed for future positions can help organizations to keep top performing workers in the company. A robust talent management solution can help map career path options for current The oil and gas pipeline construction industry is facing a worldwide labor shortage, as experi- employees and promising enced workers are nearing retirement and not enough new talent to fill the ranks. By embrac- candidates as well as unify ing recruitment technology, the industry can find qualified workers. processes from acquisition to succession planning,

32 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com allowing employees and managers to work together to tion. And doing so will facilitate communication with optimize career planning. potential talent from all over the world. Additionally, research by the Aberdeen Group shows that companies Three Ways to Boost the Talent Pipeline that actively use mobile technology report a 72 percent In order to get to the point where employees and can- increase in operational efficiency. didates can think about career paths, organizations first In an industry where employees are often in offshore have to attract them to the industry and entice them to or remote locations, mobile technology can streamline stay. What follows are three methods for increasing hir- recruiting processes, giving recruiters and hiring managing to ensure a steady pipeline of talent to replace the ers more access to potential talent from anywhere in the retiring generation. world. With mobile devices, companies can initiate recruitment requests, approve job requisitions, screen can- Developing Talent Pools: To compensate for the didates, conduct phone and video interviews and carry low number of new employees, companies will need to out pre-employment activities. It also facilitates the can- build deep talent pools from which they can source new didate experience, giving them immediate access to new talent, which involves the development of clearly de- opportunities and allowing them to apply for positions, fined skills that are aligned with business strategy. Once complete screening and assessment activities and, once these needed skills are outlined, companies can develop hired, begin company orientation. the critical competencies necessary for key leadership The oil and gas industry faces some serious head- and technical positions as well as other areas of business winds as they lose their most experienced workers to experiencing high growth. retirement. However, proactively developing ways to State of the art talent acquisition technologies can en- fill employment gaps with qualified workers is the key able dynamic talent pools of qualified candidates to be to combatting this problem. By embracing recruiting created and nurtured. With clearly defined technical and technology and using it to attract a new generation of behavioral competency profiles providing the blueprint workers from all over the globe, the industry will have for needed talent, companies can proactively source in- a steady stream of new talent to ensure future vitality. ternal and external candidates and use artificial intelligence to match them with career opportunities. Sylvia Vorhauser-Smith is senior vice president of research After putting the effort into building a talent pool, for PageUp People, responsible for driving thought leader- it’s important not to ignore its occupants. Social media ship in the field of human capital management for global can be used to maintain relationships with candidates, organizations facing cross-border expansion and growth. and updating them with company and project information and sharing insights will help to keep candidates engaged. With the entire industry juggling high demand for growth with a limited labor supply, nurturing the talent pool is a key factor to maintaining a steady source of talent.

Sourcing Across Borders: With colleges in the Unit- ed States only providing 20 percent of the engineering graduates that they did 20 years ago, filling the gaps left by the aging workforce will be difficult for companies only looking at the domestic workforce. As a result of this deficiency, companies will have to turn their recruiting efforts to the international market for any chance of success in filling employment gaps. Of particular interest for companies are the high-growth markets of China and India and the emerging markets of Southeast Asia, such as Vietnam and the Philippines, since they are produc- ing a new generation of qualified talent. But sourcing candidates from these regions presents a new crop of challenges for companies in the oil and gas industry. Recruiting international talent involves com- plying with strict government standards and introduces the difficulty of cross-cultural communication. Again, talent management technology will be an integral part of international recruiting, allowing for consistent and standardized processes for sourcing, hiring and developing candidates from foreign markets.

Embracing Mobile Technology: As younger workers become increasingly mobile, companies in the oil and gas industry will have to embrace the technology in order to attract and communicate with the new genera- napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 33 Threading the Trenchless Needle … Precisely Phoenix-based Specialized Services Co. Employs Laser Guided Boring System at Underground Storage Facility

By Randy Happel

aser guided boring is primarily bracing new and innovative under- is comprised of three underground Lused for water and sewer line in- ground technologies; most recently, salt-dome storage caverns, a 24-car stallation, but that didn’t stop one a laser guided boring system used to rail rack and three truck racks on the contractor from using the method on complete a delicate trenchless installa- surface with the capability to unload a delicate project for a crude oil com- tion for Plains Midstream Canada. six trucks simultaneously. To expedite pany’s facility. the loading and unloading of tankers During the more than 40 years Faster Fill Flow and railcars more quickly, Plains Mid- since Arvid Veidmark Jr. founded Spe- Project owner Plains Midstream stream installed an additional 6-in. cialized Services Co. (SSC) — a lead- Canada, headquartered in Houston, high-pressure gas line. ing trenchless installation contrac- is involved in crude oil transporta- The component of the project tor based in Phoenix — members of tion, gathering, marketing, terminal- awarded to SSC involved installing the Veidmark family have celebrated ling and storage as well as marketing six separate 12-in. steel casing sleeves, many accomplishments. They now and storage of liquefied petroleum 3/8-in. wall thickness, at three sepa- have another success story to attach gas (LPG). Plains Midstream selected rate locations. Abe Veidmark, vice to the list of firsts on the company’s SSC to install sleeves at three loca- president of the auger division for well-documented resume. tions to accommodate a new line SSC, explains the challenges faced by Although some of the faces have being added to the underground in- the accomplished trenchless installa- changed at SSC since 1969, the vision frastructure used to load and unload tion contractor and the decision to of the founding Veidmark — to provide LPG from tankers and railcars at the use an innovative new approach for a valuable service to the community Bumstead facility, an underground completing these intricate bores. — is still very much intact today, evi- LPG storage cavern located along the “It wasn’t so much the ground con- denced by the vision and dedication Interstate 10 corridor between Phoe- ditions or pitch, but rather the pin- of wife Marcia, along with sons Arvid nix and Los Angeles. point accuracy of the line grade we III, Aaron and Abe. SSC’s recognition, Situated some 2,000 ft below- needed to achieve for us to succeed,” and much of the company’s success ground, at the juncture of a ma- Abe says. “When installing smaller for that matter, can be attributed to jor rail line and tanker truck transit material with standard auger boring, a close-knit family committed to em- point, the 133 million-gallon facility it is nearly impossible to steer with

34 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com pinpoint, on-grade accuracy while didn’t have much leeway because of eliminating some of the difficult steps where the fiber-optic cable was po- associated with other installation sitioned,” Abe explains. “This was a techniques. The system was designed situation that reinforced the need for to install 8- to 18-in. pipe at lengths pinpoint accuracy … something that up to 350 ft though larger diameter would have been difficult to accom- and longer length bores have been plish using traditional auger boring. completed. AXIS is also capable of We had to hit the target pretty much maintaining the strict tolerance and dead on, stopping within inches short accuracy required for the types of in- of the cable.” stallations facing SSC as specified in Although the two railroad crossings the Plains Midstream job. The system presented the SSC crew with accura- requires an entry pit where the core of cy challenges that alone would have the AXIS system is placed, comprised been enough to discourage participa- of the rack, drill casings, drill head tion by most contractors, it was the and pipe laser. Located outside the second leg of this three-fold installa- launch pit is the vacuum power unit, tion project that the Veidmark broth- vacuum tank and the rack power unit. ers, despite their extensive experience Once lowered into the pit, the drill in trenchless construction, had not head, with self-contained camera con- previously encountered — a one-of-a- nected to a monitor on the operator kind rose garden. console, projects the laser beam on “When we surveyed the second site the target. With the camera viewing to identify where the entry and exit the laser beam on the target, the op- pits should be dug, we discovered an erator can accurately monitor the tar- irrigation canal that supplied water to get grade and make adjustments, ever this immense rose garden,” Abe says. so slightly, along the bore path, if the “The bore plan specified two bores drill head begins to move off course. within relative close proximity paral- Rotation and thrust from the carriage lel to the canal. Come to find out this assembly resumes as the first drill cas- was no ordinary rose garden, but rath- ing is pushed through the hole, and er the only one in the world where the process is repeated with subse- this special variety of roses are grown. quent sections of drill casing until the This itty-bitty plot contained tens drill head reaches the exit pit. of millions of dollars-worth of these “The only way we would have at- roses. If we would have tried the tra- tempted it using a jack and bore ap- ditional auger bore approach, there’s the accuracy required for all of these proach would have been to upsize to a good chance we could have drifted bores. In all likelihood there would a 30-in. diameter bore casing, then right into this multi-million-dollar have been a good deal of drifting steer the 30-in. casing back through,” garden of roses.” [with auger boring], something in- Abe says. “Accuracy was of paramount herent with this method for shorter importance. It was also such a small Staying the Course distances. All of these bores were less footprint that would have made it dif- Abe reiterates the need for preci- than 200 ft.” ficult to initially set up one of our big sion, comparing the boring process rigs there.” and subsequent installation at each Precision-Fine Boring of the three sites to that of a double- After reviewing the specifications Railroads, Right-of-Ways and barrel shotgun. and intricacies they would face at a Rose Garden “We had to complete two bores, each of the three sites, Arvid Veid- Two of the three installations inside by side, within 2 in. and main- mark III, executive vice president volved railroad crossings that required tain that same accuracy for 200 ft,” and senior estimator for SSC, recom- strict adherence to very narrow right- Abe says. “Think of it as a shotgun mended an innovative, alternative of-way tolerances established by the with two 12-in. barrels extending 200 approach. Months prior, he attended railroad. The first site required SSC to ft that we needed to keep at least 2 ft a demonstration facilitated by trench- complete two 148-ft bores at approxi- from the irrigation canal, the lifeline less experts with Vermeer highlight- mately 10 ft deep, while the third lo- to a multimillion-dollar rose garden. ing a new laser guided boring system cation — two 180-ft shots — called for I was very thankful to have the accu- that had the capability to complete crossing beneath seven separate sets of racy of the AXIS system.” smaller-diameter bores with pinpoint tracks to the terminal site where natu- Equipment staging and footprint accuracy and strict on-grade preci- ral gas is offloaded from the transport- was also a consideration for the Veid- sion. Although designed primarily for ing railcars. Positioned close by was mark crew as they reviewed the op- sewer and water projects, the two felt a large underground fiber-optic cable tions facing them to select entry and the AXIS guided boring system was that limited the position and excava- exit pit locations at each of the three just the answer they were looking for. tion depth of the bore pit. sites. According to Abe, aside from the AXIS is a pit-launched trenchless in- “The location of the reception pit additional space needed to stage the stallation method designed to achieve was sort of questionable, but we really various components of the AXIS sys- napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 35 tem (compared to auger boring or horizontal directional drilling), the area required for excavating staging and re- ceiving pits is minimal. After determining locations and excavating the launch and exit pits, the SSC crew shored up the walls with metal bracing, set the laser to the desired grade and depth, and lowered the leveling frame and rack assembly into the launch pit. The first 6.5-ft drill casing was then placed in the rack carriage and drilling was began. “It’s a relatively quick process once everything is in place,” Abe says. “Ground conditions were ideal so that wasn’t a factor. We completed the first two bores without any problems, the second in less than four hours, which is really good. We popped through precisely on target in the exit pit, and disconnected the bit, attached the pulling head and pulled the casing back through.” Abe explains that the vacuum excavation unit used by the AXIS guided boring system requires a fair amount of water to facilitate the removal of spoil. However, he goes on to say that the vacuum system ultimately en- hances production rates because the need to suspend drilling operations to manually handle spoil within the launch pit is eliminated. The system also helps provide a cleaner pit environment. Installing the casing was a breeze at two of the three locations — bores of 200 ft and 180 ft, respectively — as the SSC crew was able to weld the entire length of casing seg- ments together, allowing them to pull the material back through the AXIS-created bore path in one continuous shot. This was accomplished by digging a ditch beyond the exit pit and placing the entire expanse of material within, a strategy that wasn’t possible at the final loca- Specialized Services Co. used a laser guided boring system to tion due to the position of the large fiber optic cable. install lines in a liquids petroleum gas facility. “At the third location, since the fiber [cable] was in direct With the exception of a few minor learning-curve glitch- line with the bore path, we were limited to pulling back the es that Veidmark explains were quickly fixed by the AXIS steel casing in increments of 10 ft,” Abe says. “This required system experts at Vermeer, the six bores were completed on- us to weld each segment together in the pit, repeating the target, on-line and on-grade. And despite the guided boring process until the entire 150-ft shot was complete. We were system having been used primarily for water and sewer in- also required to pressure test each weld, which slowed the stallation previously, the bores completed by SSC substanti- process down quite a bit.” ate the versatility of AXIS, regardless of the application. “The capability to maintain the target so precisely and the confidence to know that you will hit your end target exactly where intended is a huge advantage for the AXIS system,” Abe says. “The cost is another huge advantage. I would have been very nervous to attempt this with just a traditional auger because of the 12-in. diameter. You just don’t know for sure where it’s going to go. That’s certainly not the case with AXIS.”

Randy Happel is a features writer for Two Rivers Laser guided boring is typically used in water and sewer line installation, but proved versatile Marketing, based in Des enough for this petroleum project. Moines, Iowa.

36 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com It’s not a pipe dream – Watch for 12 issues of North American Oil & Gas Pipelines this year! Subscribe today – it’s FREE! Renew today and watch for these and other features in 2012: • Pipeline Maintenance Tips • Excavation • Corrosion Control Don’t Miss • Exporting Oil & Gas An Issue! Scan this code with • Pipe Materials & Products your smart phone and • Product Showcase in every issue subscribe online! • Big Equipment Handbook • North American Oil & Gas Pipelines Buyer’s Guide

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PLEASE PRINT CLEARLY What is your company’s Which types of equipment or services do primary activity? (check only one) you recommend for use in the oil & gas Name______A  Excavation Contractors pipeline industry? (check all that apply) B  Pipeline Construction A  Cathodic Technology Title______C  Pipeline Maintenance B  Cleaning Pigs D  Engineering C  Coatings/Linings Company______E  Consulting (Legal, Financial) D  Corrosion Monitoring F  Government/Regulatory E  Environmental Awareness Address______G  Transmission Pipelines F  Flow Control Software H  Distribution Pipelines G  GIS/GPS systems ______I  Exploration/Production H  Inline Inspection J  Equipment Mfg/Supplier I  Leak Detection/Prevention City______K  Other______J  Offshore Pipe Laying State/Prov______K  Pipe Materials What is your primary job L  Pipeline Communications Zip/Postal Code______Country______title/function at your company? M  Pipeline Design Engineering (check only one) N  Pipeline Machinery Phone______A  Owner/CEO/President O  Pipeline Maintenance B  Executive Mgr/VP/COO/CFO P  Pipeline Rehabilitation Fax______C  Financial Manager Q  Pipeline Safety D  Superintendent R  Pipeline Security Email______E  Manager S  Project Financing & Insuring Signature______Date______F  General Manager T  ROW Management G  Director U  SCADA/Automation Software H  Engineer/Consultant V  Trenching Materials I  Supervisor/Foreman W  Trenchless Technology Yes, I want the bi-weekly E-newsletter. J  Attorney X  Welding www.napipelines.com K  Other______Y  Other______*The subscription is free in the USA, Canada & Mexico NAOGP0312 Bradco Trencher Attachments The Bradco trencher line by Paladin Construction Group yields a higher usage rate of your existing equipment at a fraction of the cost of dedicated trenching machines. The perfect complement to compact and standard skid-steer loaders or tractors, the full trencher line includes the Bradco 330, 612, 615, 615F, 625 and 640. Choose from cutting depths that range from 24 to 60 in. and cutting widths of 3 to 12 in. Both standard and high flow models are available. The entire Bradco Trencher line provides several tooth options, including cup, shark and rock & frost teeth, so you can meet your job’s individual requirements. A discharging auger neatly places dirt away from the trench to eliminate refilling. For jobs that require close proximity to buildings, fences, walls and other obsta- cles, the Bradco 615F trencher’s offset auger discharges the dirt to one side away from the trench. Each trencher uses a fixed-length boom with a spring-loaded, self-adjusting idler and full rock guard to provide added durability and safety during trenching. A heavy- duty crumber and safety bar also provide better trenching precision, while minimizing flying debris. Every Bradco trencher comes with a two-year limited warranty. The Bradco 615, 615F, 625 and 640 trenchers are designed to fit compact and standard skid-steer loaders. Each offers tooth pattern versatility and uses a rugged 50,000-lb anti-back-flex chain for extended life in the toughest of soil conditions and applications with small rocks. Multiple motor options are available to match the flow and requirements of various skid-steer loader models and manufacturers. The Bradco 330 and 612 trenchers are designed to mount on a tractor’s three-point hitch and are PTO driven. The PTO shaft drive has a heavy-duty slip clutch that protects against overload- ing and excess maintenance costs. The Bradco 330 uses a 38,000-lb anti-back-flex chain that is ideal for medium-hard soil conditions, while the Bradco 612 uses the same 50,000-lb anti-back-flex chain as the skid-steer loader models for more rugged conditions. For more information, visit www.paladinconstructiongroup.com.

Trench-Tech International TT-2950 With over five decades of design experience, Trench-Tech International introduces the mechanically driven TT-2950. Engineered specifi- cally for large diameter pipeline work and powered by two Caterpillar engines, it provides 1,390 hp and the ability to cut up to 78 in. wide and 30 ft deep. The mechanical chain drive has four different chain speeds providing high torque and low speeds and allowing for maximum tooth penetration and extended tooth life. The discharge system consists of an arc-type conveyor with variable discharge speeds that is shiftable in either direction for precise spoil placement, using three-ply heavy-duty belting material and double row cleats for maximum discharge efficiency. The digging boom and tailwheels on the TT-2950 feature heavy-duty weldments, sectionalized to provide for various boom option lengths. Trench-Tech exclusive replaceable heat-treated alloy wear plates are held in place by large Caterpillar type cutting edge bolts with 48-in. heavy-duty single or wheel assembly. The operator cabin comes fully enclosed with climate controls for heat and air conditioning and a pressurized system for a dust and noise free environment. Opera- tors of the TT-2950 have a panoramic view with the elevating cabin and the exclusive Trench Safety Vision System, which is found standard on each machine. The camera system provides machine operators with views from up to three or four cameras mounted around the machine. Images are displayed on a 7-in. color LCD screen located in the operator cab. With the increased visibility, operators can now be aware of many more aspects of the work environment, improving work efficiency and safety. Options for the TT-2950 include a Milling and Mining attachment. The Trench-Tech milling and mining head attachment is designed to make the standard track-mounted trenching unit more versatile by adding the wider width cut of 15 ft, 8 in. and 3 ft deep available in a single pass. For more information, visit www.trenchtech.com.

38 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com Trencor T1760 Chain Trencher The Trencor T1760 mechanical drive chain trencher offers plenty of power and performance in the toughest digging conditions. It’s ideal for pipeline work and water, sewer and utility installation. Its Caterpillar turbocharged diesel Tier 2 Stage IIIA engine provides 950 hp and 3,122 ft-lbs of torque at 1,400 rpm. It can trench up to 72 in. wide at a depth of 16 ft or up to 36 in. wide at a depth of 30 ft. Four newly designed, 10-in. bore boom lift cylinders improve performance and reduce maintenance points. The Trencor line of high-performance rock trenchers, surface miners, RoadMiners and related equipment is well known for its durability and high-production capability. Trencor has more than 60 years of experience in the specialized trenching industry, serving the mining, construction and pipeline markets. All Trencor products are manufac- tured in Loudon, Tenn. Trencor machines are supported through a dedicated parts and service center, available 24-hours a day to help customers minimize downtime and get needed repair parts. The Trencor lineup includes seven different trencher models that can be configured to meet custom applications. Models include the T765, T1060, T1360, T1460, T1660, T1760, and the T1860. A rugged RoadMiner attachment is also available. The RoadMiner is particularly well suited to tasks that require the removal of large quanti- ties of material for site preparation, building construction, road building, soil remediation, mining and quarrying. Trencor is a division of Astec Underground. For more information, visit www.astecunderground.com.

Vermeer Bucket Wheel Attachment The Vermeer high-capacity bucket wheel attachment is designed for the installation of small diameter cross-country pipelines and helps increase productivity in soft soils. Instead of the typical chain configuration, which positions the carbide trencher teeth in a specific formation or pattern, the wheel features a series of buckets, which rotate in a circular motion helping move more dirt from the trench. Optional pingo teeth, which enhance the removal of dirt, are also available. The attachment has a cutting width of 22, 24 or 28 in., depending on the size of buckets used. Vermeer has incorporated a number of unique design features into the attachment. To protect the bucket from damage, an independent metal band is bolted to the rim and acts as a leading edge to remove dirt from the trench. Should the bucket happen to hit a rock, the band is designed to break away from the rim. The band can easily be bolted back into place, saving time and allowing the operator to simply replace the band rather than the whole bucket. The bucket wheel is powered by the Vermeer T655 tractor, which features a 250-hp John Deere 6090 HF diesel engine. An optional auto-leveling tilt track allows the operator to maintain a vertical trench on slopes up to 10.5 degrees. For projects requiring high horsepower and deep digging depths, Vermeer offers the T1055 Commander 3 (not pictured). Powered by a 415-hp engine, the T1055 features a rotary power headshaft and splined headshaft that produce a lower speed and higher torque, providing supe- rior rock penetration and low chain wear for better production results. The T1055 is equipped with the new TEC Plus electronic control system, designed for im- proved diagnostic capabilities and to increase performance by enhancing machine controllabil- ity. Sectionalized boom lengths increase work efficiency. The 6-, 8-, 10-, 12- or 14-ft boom lengths offer job flexibility and eliminate the time and effort of changing booms. For more information, visit www.vermeer.com.

napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 39 North American Oil & Gas Pipelines Calendar

The Events Pipeline Conferences, Meetings & Trade Shows

March April June

6-8 10-11 3-7 API Conference & Expo ShaleComm 2012 PLCA Canada Annual Convention Marina Bay Sands Hotel Westin Convention Center Fairmont Chateau Singapore Pittsburgh Whistler, British Columbia Web: www.apiexpo.org Web: www.ShaleComms.com Web: www.pipeline.ca

6-8 11-13 July CGA Excavation Safety Conference and INGAA Foundation Spring Meeting Expo Marriott San Antonio Hill Country Resort & Spa 11-15 Rio Hotel San Antonio DCA Mid-Year Meeting Las Vegas Web: www.ingaa.org La Posada de Santa Fe Resort & Spa Web: www.cgaconference.com Santa Fe, N.M. 16-18 Web: www.dca-online.org 9-14 DCA Annual Safety Congress PCCA Annual Convention Planet Hollywood 24-26 Hyatt Regency Hill Country Resort & Spa Las Vegas Deep Gulf San Antonio Web: www.dca-online.org Galveston Island Convention Center Web: www.pccaweb.org Galveston, Texas 17-19 Web: www.deepgulfconference.com 11-15 API Pipeline Conference No-Dig Show American Petroleum Institute 31-Aug. 2 North American Society for Trenchless Web: www.api.org Gas Operations & Leadership Summit Technology (NASTT) Midwest Energy Association Gaylord Opryland Hotel & Convention Center 30-May 3 Iowa State University Nashville, Tenn. OTC2012 Offshore Technology Conference Ames, Iowa Web: www.nodigshow.com Reliant Park Web: www.midwestenergy.org Houston 12-16 Web: www.otcnet.org August NUCA Annual Convention Renaissance Worthington Hotel May 19-22 Fort Worth, Texas ASCE Pipelines Conference Web: www.nuca.com 15-17 American Society of Civil Engineers (ASCE) Appalachian Underground Corrosion Fontainebleau Resort 13-17 Short Course (AUCSC 2012) Miami Beach, Fla. AGC of American Annual Convention West Virginia University Web: http://content.asce.org/conferences/ Hilton Hawaii Village Beach Resort & Spa Morgantown, W.Va. pipelines2012 Honolulu Web: www.aucsc.com Web: www.agc.org Advertisers Index Advertiser Website Page # Advertiser Website Page # Alliance Plastics...... www.allianceplastics.com...... Poly bag Pemberton Inc...... www.pembertoninc.com...... 28 Astec Underground...... www.astecunderground.com...... 44 Pipeline Inspection Company...... www.picltd.com...... 13 E-Z Line Support Company Inc...... www.ezline.com...... 25 Pipeline Machinery-CAT...... www.plmcat.com...... 5 Fecon Inc...... www.fecon.com...... 11 Precision Pigging, LLC...... www.PrecisionPigging.com...... 23 Finn Corporation...... www.FINNcorp.com...... 9 Rig Source...... www.rigsourceinc.com...... 2 Girard Industries...... www.GirardIndustries.com...... 21 Sawyer Manufacturing...... www.sawyermfg.com...... 15 The HDD Co...... www.hddcompany.com...... 19 StraightLine HDD...... www.straightlinehdd.com...... 43 Horizontal Technology Inc...... www.horizontaltech.com...... 7 Trenchless Technology Road Show...... www.trenchlessonline.com...... 17 IPLOCA...... www.iploca.com...... 41 Vacuworx...... www.vacuworx.com...... 27 Laney Directional Drilling...... www.laneydrilling.com...... 33 Wasatch Supply...... www.psscompanies.com...... 29 Mesa Products...... www.mesaproducts.com...... 41 Welded Construction L.P...... www.welded.com...... 30 NACE International...... www.nace.org/education...... 3

40 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com Business Cards

napipelines.com MARCH 2012 | North American Oil & Gas Pipelines 41 Pipeline Perspectives

Pipeline Industry Safety Culture We Own it, What Do We Do With it? By Don Thorn

A great deal of emphasis has been placed on improving considerations for improvement. safety processes and conditions in the pipeline industry Before coaching can be successful, expectations must workplace during the last several years. This is a positive be understood by all team members. Plans must be devel- move as the facility and processing portion of the oil and oped for training and directions provided for the journey. gas industry has been ahead of our focus on this path. Once defined and understood, those team members who Through individual contractors, owner companies and don’t wish to follow team rules risk being asked to leave various mega projects, we have moved in the correct direc- the team, rather than potentially becoming the victim or tion. Group organization efforts such as the Pipe Line Con- cause of a tragic incident. To quote a learned business ad- tractors Association (PLCA), visor, Dr. Emil Fails once said, the Distribution Contrac- “If you don’t have a plan for tors Association (DCA), the This commitment to safety where you are going, you are American Pipeline Contrac- already there.” tors Association (APCA) and Employee commitment is INGAA Foundation have can positively lead to essential to the effort of in- provided direction and sup- stilling a robust safety culture. port via multiple venues, fo- Ownership buy-in and mak- rums and programs. These modifying behaviors and ing safety a value in their own have included the inclusion personal lives and within their of third-party consulting having a team of people family will firmly cement the companies and regulatory foundation of this process. agencies. Once achieved, this com- This collaborative ef- who work together to mitment to safety can posi- fort has been encouraging. tively lead to modifying be- This is not just a union vs. haviors and having a team of non-union issue or owner- achieve desired goals. people who work together to operator-client issue or a achieve desired goals with- problem solely for contrac- out unnecessary risk-taking, tors, designers, inspectors, management or labor. This is which then mitigates exposure to potential dangers to reduce — to the point of elimination — incidents that with proper project execution plans and resulting in result in employees of any party in this industry being safe execution techniques during construction. injured, which results in individuals and families being affected negatively for periods of time that can vary from Keeping Open Channels a brief period to a lifetime of disability. However, indi- Communication of our results to our employees, vidual ownership is the only true solution to reaching staff, clients and to the industry is necessary for growth the level this culture truly needs to achieve. among the industry as a whole. We must encourage and It truly is up to you and me. The decisions we make embrace new ideas. We can learn from each other. each day, the examples we act out and what we consider We must, as beginning points, agree that 1.) All ac- important and demonstrate as such does matter. This is cidents are preventable; 2.) Zero incidents/accidents true regardless of our role within the industry, whether it are the goal; and 3.) Safety must become a core value. be management, superintendent, foreman, engineer, in- We must stop viewing safety as just a priority, as priori- spector, office worker, accountant, equipment operator, ties change over time. Values grow stronger as we travel welder, truck driver, laborer, welder helper or any other through life. position. Our actions influence our fellow workers more As you lead along this path, do so not only by ex- than we realize. ample, but by bringing teammates with you so that they We are examples, negative or positive. may become leaders such that we accomplish our goals,

for this industry and its culture, through the desire to How Do We Get There? join rather than the coercion tactics that have some- As an example, championship teams do not reach such times been attempted in the past. levels of excellence without championship coaching. Identifying things that we are doing wrong, providing Don Thorn is president of Welded Construction LP, based guidance for correcting, gathering agreement as to the in Perrysburg, Ohio, and a member of the North American proper path and best methods going forward are essential Oil & Gas Pipelines Editorial Advisory Board.

42 North American Oil & Gas Pipelines | MARCH 2012 napipelines.com