For the oil & gas industry alone, the yearly cost of corrosion damage is estimated to be over $1.3 billion USD according to NACE International (formerly National Association of Corrosion Engineers) and now known as AMPP: The Association for Materials Protection and Performance. They note:
That figure can be broken down into $589 million on surface pipeline and facility costs; $463 million annually in downhole tubing expenses; and another $320 million in capital expenditures related to corrosion.
In this Storage Terminal Reliability podcast, Emerson’s Dag Joraholmen discusses how corrosion monitoring can reduce the need for reactive maintenance and increase the overall reliability of storage terminal operations across the production lifecycle.
Visit the Storage Terminal Reliability and the Corrosion & Erosion Monitoring sections on Emerson.com for more on the technologies and solutions to help you drive safer, more reliable, and more efficient terminal operations.
Jim: Hi, everyone, this is Jim Cahill with another Emerson Automation Experts podcast. Today I’m joined by Dag Joraholmen to discuss ways to improve storage terminal reliability through continuous corrosion monitoring. Welcome, Dag.
Dag: Thank you so much for having me, Jim.
Jim: Well, it’s great to have you join us today. Let’s start out by asking you about, can you share your background and path to your current role here at Emerson?
Dag: Absolutely. I appreciate that. Yes, I started in Costa Rica. I’m from Costa Rica. I used to be a diesel mechanic, repairing what we call the Sealand refrigerator containers. And from there, I grew into an opportunity to work and live in the United States, went to Texas A&M University, graduated with a degree in engineering. And my evolution into Emerson came about my experience working with offshore facilities, plants, offshore drilling platforms, and looking at what we talked about, the asset integrity requirements of the NORSOK, which is the Norwegian regulatory environment that allowed us to understand the different elements that affect asset integrity and avoidance of loss of containment.
Jim: Well, that’s a fascinating background, you know, from diesel mechanic to Texas A&M engineer into all aspects around asset integrity. Well, let’s dive into it and start out, corrosion is a major asset integrity issue in many industries. Can you give us a sample of the corrosion issues that have affected your customers’ assets around storage terminals?
Dag: Yes, indeed, thanks. The experience that I’ve had with terminals, and is primarily a long attacking the piping of terminals, we have found through sources like API 754 and other data that we have collected, about 60 to 70% of the major incident losses is because of internal corrosion, whether it’s the equipment internal corrosion, the piping. But we’ve also found that the majority of the issues that affect our customers’ assets is their inability to inspect everything all the time and understand how their risk of corrosion can create a negative impact on their asset integrity.
Jim: Well, yeah, that sounds like if you can’t continuously look at it, you might find out the hard way when you have some kind of loss of containment. So what are the pressures terminal operators face that will drive these corrosion issues to the forefront of their business?
Dag: Well, I’m going to press maybe a handful of items, and hopefully, we can make this a short answer. At the same time, I would like to present a visual image to my audience that the tanking or the terminal management folks are under a lot of pressure on their business. There are economic benefits of using different products or storing and managing different products. And we can have people that have tanks with acids to other things that are poisonous. And the issue we have with them is that as the economic pressures on selling more and cheaper will allow them for the evaluation of riskier products, what we call maybe dirtier products to be stored, especially if it’s a feedstock on finished products. How much acid are you going to allow in finished products? But at the end of the day, the folks are always affected by the economic impacts in the marketplace.
We would like to see that everybody has an opportunity to have a positive margin, everybody wants to make a profit, but as the economies of the market changes, they have to also adapt to the changing conditions. Also, what we have found is that there is demand for longer runs in between maintenance or shutdown cycles for inspections. So, the scenario is they have to run longer with more economic pressure, with tighter capital expenditure budgets, a lot of these people have to deal with assets that have been around for a long time. They were designed for different conditions that are being exposed to new processes, new products, and new conditions.
The most important pressure they have to deal with is what happens with the loss of containment. What is the health implication or the environmental consequences of not only their spill but how do they comply with the ever-changing environmental regulations and health requirements for their staff? And last, what we have all experienced in several industries, especially in the energy industry, you can see that we are getting fewer and fewer people that have the ability to teach the newcomers about how to operate an asset safely. The shortage of experienced personnel is clear and evident. And we’re looking at tools that allow us to continue maintaining the health asset, even during the transition from experienced people to inexperienced staff.
Jim: Wow, that certainly is a wide range of issues from some of the economic pressures to the people side of it and the experience required to do it. So it’s great that technology can play an increasing role there. So can you walk us through what is the best way to manage and mitigate leaks due to corrosion?
Dag: Absolutely. In terms of managing and mitigating leaks due to corrosion starts with understanding what parts or portions of your assets are at risk, due to corrosion. So we can measure the risk of corrosion or offer the customers an idea of the risk that they’re introducing into their processes. For example, as you move, let’s say, an acid through a pipe, from a tank to a pipe, we know the risk is high but what can you do to understand that risk, if you don’t have a way to look inside the pipe?
The other scenario that they have to look at is not only am I exposing my asset to our risk of corrosion, but can I actually visualize or quantify the impact of that corrosion on my asset? As we know, assets are designed with very specific tolerances. And we know that the wall thickness for a tank or a pipe or a manifold, all those have critical impact on the safe operating of an asset. What we have over at Emerson is a great portfolio of managing not only the corrosion risk with several electronic and wireless probes within the Roxar family of products. But as well, we can measure the actual impact of corrosion, with a family of products through the Rosemount Permasense brand, that allows us to measure the actual wall thickness of the pipe or the tank.
So with these two product lines, we create what I think our intelligent business…would provide the customer intelligent pieces of information that are actionable. And the key here is allows the customer to see what’s happening in their asset, whether the risks that are already producing it to their tanks or the pipes, but also measure the impact influence being able to see that at their fingertips in front of them on a computer terminal, they can start making decisions of what to do next. Those decisions then can turn into actionable items, such as, for example, deeper inspections, shutting down the asset, be able to confirm that you can run the asset longer if things are still safe, and avoiding what I call a loss of containment, which is in terms of operating an asset is an upset. And we want to avoid all these upsets. Every absent will cost you money.
So if you think the cost of a leak or shutting down for a day, versus what you can do with this technology, you’re going to find that the return on investment on some of these tools that we provide the customer create financial benefit. I’ve seen return on investment calculations from the customer that have seen these tools pay back in less than 12 months, some of them less than six months. So those intelligent and actionable points of information that you can concatenate into your decisions and devise trends and help guide your teams into safe operations is the ultimate tool that I can offer my customers.
Jim: Well, that sounds like yeah, being able to have that data to make informed decisions to avoid some of those situations would be very helpful there. So what is a common scenario we find around corrosion? And you mentioned the technologies and the Roxar and Permasense brands, what might you recommend helping improve overall asset performance and reliability?
Dag: This is a very good question that I get also from all my customers, “What do you recommend?” And we are finding that our collaboration practice with the customers, they know their assets better than anyone else. And that can help give them a portfolio of options. So they can implement what makes sense to them. They understand that their risk-based inspection protocols tell them what parts of their assets are a priority for these types of measurements. We can offer intrusive measurements, so they can see the effect of inhibitors, for example. If they’re trying to create a blend of products to understand the risks that are introducing into that portion of the asset, let’s say a blend of products that they’re offloading from a tank, what things they can cause, some feedstock products, they have residue or what we call BS&W [basic sediment and water], which may contain some particles.
We can use our technology to tell them where erosion can be caused because of those products that are not perfect. And we know that feedstocks are not always 100% perfect, especially when we’re bringing raw materials into tanks, they contain a certain percentage of day one, we call the BS&W, in all products. So, we can have intrusive and nonintrusive products to measure the risk of what’s happening with the movement of product from one tank through their series of manifolds and pipes to their destination. But we can also use non-intrusive tools that can measure the actual wall thickness. And measuring the actual wall thickness which I mentioned earlier with Permasense and with their managing the risk or measuring the risk, the impact of their actual combination of the production of their processes will allow this customer to understand first, are they operating in a safe environment?
They can look at the measurements and they can decide themselves in real-time where they can handle a riskier product and instantly measure what it is causing to their asset. And they can confirm in real-time that they’re operating in a safe manner and avoiding a loss of containment. Before, customers would have to manually create them what I call a chain of visual events to understand what was happening, the leak would be found only when somebody saw it or they will do some manual inspections that were not reliable, they were not available immediately, and they were not repeatable. And those three elements are key to be able to predict how your asset will behave. So, availability of data, accessibility to the locations so they report that inspect is going to be safe. Let’s imagine the top of a tank. And they do it the same way twice. Then one person or two people deliver the same results by doing it manually the same way. And we found that those three components today, we can fulfill with our products allow our customers to run a consistent predictable result for them to make decisions day in and day out.
Now, in terms of a common scenario, we get on tanks the typical self-corrosion on the outside and they do not know what the corrosion on the inside may look like. I mentioned that corrosion on the outside yes exists but on the inside 60, 70% of the leaks that we have collected data for has been because of internal corrosion of a pipe or a tank. At the end of the day, we have to prove that these types of solutions not only are technologically savvy, and accurate, and dependable, but we also have to understand do they make sense? Are we adding value to their processes of inspection and maintenance? And will their results and return on investment, justify or help justify the expenditure on the tools? I mentioned earlier that we’ve seen return on investment cases that are almost immediate.
I had one case where a, just a maintenance team, some the things that we helped them avoid such as I access to locations that were not as safe, by using our technology, they no longer had to climb up ladders and create an unsafe situation or potentially unsafe situation for an employee. And they were getting constant monitoring of that high-risk point in their asset. At the end of the day, some of our customers have hired third-party people to give them their inspection results. And those third-party people just provided data. One thing that our customers have learned to come to rely on us at Emerson is that we can help them manage their data, interpret their results, and provide an actual actionable report, whereby they can share that across the entire enterprise because those reports are easily shareable. We use them in electronic format, and we have what we call different dashboards that allow them to take decisions on the spot. And we have provided for them the measurements. We have done the data interpretation. We have prioritized the different data results by location, and the customer can take actionable data.
For those things alone, we have seen return on investment that are not only full of what we call verifiable data points, but we also have some of those intangibles. such as employee safety, that sometimes you cannot put a price to it. Sometimes we’ll say, if we can avoid one person getting hurt, what value does that have? Overall, in operations, we’re worried about leaks or loss of containment. What is the cost of losing containment in that asset? Is that something that can cause you to lose your licensing, your permitting or is it something that is just an economic disruption to your business? At the end of the day, as I mentioned earlier, our customers have a lot of pressures from regulatory bodies or environmental conditions, and financial pressures in the marketplace to operate efficiently, effectively, and with positive results.
Jim: Wow, you pretty much talked about the whole lifecycle from that upfront collaboration, say, for an upstream oil and gas producer, and how much basic sediment and water, that BS&W you mentioned, all the way to in operation being able to see the impact of maybe some production that you’re flowing in there, maybe higher acidity or whatever else that could cause greater corrosion all the way, you know, through the lifecycle, being able to collaborate with the meaning of this data coming from these different areas and making recommendations about what to do with it. So it sounds like throughout, really that whole life cycle, that we can be a part of, you know, helping them have more reliable operations. Let’s wind things down towards the end. I always like to throw this out there about what haven’t I asked you that I should have asked you in our discussion today?
Dag: I appreciate that question. And we get that question also, from customers, “What have you experienced with other customers that we have not asked or talked about?” Well, I have to mention that my goal today was to create a visualization of what corrosion risks… You know, corrosion can affect your asset integrity, and that help you avoid loss of containment. I think I’ve achieved that goal. And I think that from there, customers can get what I call get into the weeds of their very unique particular scenarios that they have themselves. Every customer that may be tanking, for example, they may not all push the same product through their asset. But at the end of the day, they may have the same risks and consequences or impact of corrosion affecting their asset integrity. They want to avoid loss of containment, when loss of containment is not only environmentally an issue but also what do you do with the product that you lost? If it’s a sizable loss of containment, will cost you a lot of money. If it’s a high consequence area, you don’t want to have the environmental impact, financial impact of cleaning that mess up, right?
So each customer will come to us and extend those conversations by invitation, of course. We will sit down and work with them on defining what we call the phased approach. Do we start with early discussions like you and I did? And will we go from there to an assessment evaluation where our team of experts can help collaborate with the customer in evaluating different scenarios? So we can have a few scenarios that maybe one significant event that has created the impetus for us to be talking about corrosion monitoring. This scenario then evolves into, based on these tools and these results, can you extend your service capabilities to help us manage the entire enterprise? And we’ve talked to some customers. I had the good fortune last week to meet with a customer that they have 600 tanks. We started small. And that’s what I think is important to let customers know that our tools are scalable, so we can then talk, where we can start small, where it makes sense, and grow their solution. There’s quite a bit of information on the Emerson website where we talk about corrosion management. We talk about tools like Plantweb Insight, that is that technology is highly scalable. And we talk about dashboards that allow customers to make decisions quickly.
Jim: Well, you preempted my next question a little bit, which is for those that have heard something that sparks their interest, where can they go to learn more about helping their reliability through corrosion monitoring?
Dag: Looking at the Emerson website, it is quite overwhelming because we have so many products, but you can go into the emerson.com website and look through the industries and look at the storage tank, sorry, at the transportation storage and tank storage section of our website. It gives you more idea of the products that we utilize to serve that segment of the industry. You can also Google “Emerson” and “corrosion” or “corrosion sensors,” “corrosion monitoring.” So we have quite a bit of ways of getting information. And as I mentioned earlier, we have two family of products dedicated specifically to the corrosion monitoring risk and impact that could affect your facility. One was the Roxar family of products and the other one is the Permasense family of products.
Jim: And I’ll add some hyperlinks to the transcript we have to help our listeners navigate to some of those areas. And I guess finally, Dag, how can our listeners reach you if they have questions?
Dag: I aDag Joraholmen joins pm reachable through my personal cell phone number, which is 346-342-3436, or email@example.com.
Jim: Well, I want to thank you so much, Dag, for joining us today and sharing with our listeners some of the technologies and issues and ways to move forward. So, thank you so much.
Dag: My pleasure, Jim. Thank you so much. And thank you all for listening to us.
-End of transcript-