Podcast: Improving Fiscal Measurements and Loss Control

by , , | Feb 17, 2021 | Flow, Oil & Gas

Chelsea McGovern

Author and Content Specialist

Optimizing Storage Terminal Capacity podcast seriesTerminals, the storage and transportation hub for oil & gas and petrochemicals, are critical to the overall infrastructure and flow of products to consumers and businesses. They form a vital link in global supply chains increasingly driven by a landscape of boutique products and just-in-time logistics.

“There’s probably about 2- or 3-days buffer in the flow of goods [in terminals supply chain] before we would start to experience interruptions as customers.” – Marc Buttler

In this episode of our Optimizing Storage Terminal Capacity podcast series, Marc Buttler, Innovation Director at Emerson Automation Solutions and longtime veteran of Micro Motion Coriolis flowmeter technology, addresses the process challenges faced by terminal operators that relate to fiscal measurements. Addressing solutions that can help you mitigate fiscal risk by balancing terminal inventory and modernizing your terminal storage facility with efficient and informed decisions.


Visit the Optimize Terminal Capacity section on Emerson.com for on ways to maximize capacity by mitigating product custody and loss control risks through more accurate and reliable fiscal measurements.

Transcript

Jim: Hi, everyone. I’m Jim Cahill, and welcome to another podcast in our Storage Terminal Capacity Series. Today I’m joined by Marc Buttler to discuss ways to mitigate product custody and loss control risks to help you improve your bottom line and minimize fiscal uncertainty. Welcome. Marc.

Marc: Thank you, Jim. It’s great to spend time with you today. Appreciate the opportunity.

Jim: Yeah. Likewise. So, I guess to get us started, Marc, can you share some of your educational background and the career path to where you are today as the application innovation director for the flow solutions part of our measurement business?

Marc: Well, sure. I’d be glad to. My education is in engineering. I got a degree in mechanical engineering from the University of Colorado, and I continue to live here in Colorado and I work at the Boulder headquarters for our Micro Motion business unit of the Emerson measurement group, where we build Coriolis meters. The work history that I have includes 33 years working here with the Micro Motion Coriolis meters, but in the middle of that, I took a diversion from working with Emerson to go work for the U.S. Department of Commerce at the National Institute of Standards and Technology, where I worked in the Office of Weights and Measures for about three years, found that I missed working in Boulder and with Coriolis meters so much that I returned here and here I am today.

Jim: Wow. That’s a fascinating diversion there into that area. So, let’s get into terminals. Can you describe some of the challenges faced by terminal operation managers?

Marc: Sure. I’d be glad to. You know, terminal managers have a big job to complete, and I don’t know if a lot of us who are just laymen, driving around, living our lives every day really can appreciate just how critical terminals are to our overall infrastructure and how essential the flow of goods in order for us to be able to receive everything from gasoline and diesel fuel for our cars to jet fuel for our airplanes to milk for our table. All of these rely on terminal operations to be running smoothly. And the room for error is not as great as many of us might really think. There’s probably only about two- or three-days’ buffer in the flow of goods before we would all start to experience interruptions as consumers. So, I think we all probably underappreciate terminal operators and some of the challenges they face, which include, first and foremost, making sure that they keep track of all the valuable goods that they deal with in their terminals. And they have a term they use for this; they call overs and shorts.

And when they have overs and shorts, their terminal inventory doesn’t balance, and that creates problems that they then need to go and troubleshoot in order to keep the terminal operating efficiently and make sure that the fiscal risk is being managed in a way that’s going to keep the terminal operating. The other thing that they face is a responsibility, especially when they deal with hazardous materials to watch out for any potential leaks, because although they’re rare, when they happen the consequences can be severe. So, they use sophisticated leak detection systems and methods as part of their terminal operation to determine whether there might be any potential for a leak that they need to investigate, and that will often cause the terminal to shut down if there’s even a hint. So, they need very good terminal leak detection systems to be able to detect any leak without false alarms that cause interruptions in service.

The other thing that is a real challenge for them is that they’re running constantly. So, it’s difficult to perform upgrades and keep up with the latest technology without making careful plans. And so, when they do upgrade systems, they need a way of doing it very quickly so that the terminal operation is not interrupted. And one of the other challenges that they often will face as a result of measurement problems are disputes with customers. So, if a customer receives a batch of product and there’s a disagreement about the quantity, that can result in a rather complicated dispute that will lead to troubleshooting and possible legal action in order to resolve the dispute, plus regardless of who comes out on top of any kind of dispute resolution, they’re never a good thing for anybody and they can ultimately erode the reputation of a terminal and terminals do get reputations for measurement accuracy, fairness, safety, and even reliability. One of the most important things that will guide people who are customers of terminals is how efficiently they run, how long you have to wait in line to either drop off or pick up your load, and that will ultimately be determined by how reliable your systems are and whether they have a lot of downtime due to troubleshooting and measurement issues that have to be corrected.

Another challenge that they face are regulatory compliance, and a lot of industries have strict regulations that they have to build a mass of documentation to show that they’re in compliance with. And that can be a bit of a distraction from day-to-day operation if you don’t have the tools at your fingertips to make that task easier, plus those regulations are constantly evolving. So, you have to stay ahead of things and really know what you’re doing in order to avoid getting caught by surprise with the most recent regulatory changes. And then the last thing I’ll mention as a challenge that are faced by many terminal operation managers is maintaining the quality of the actual product in your tanks and storage. And that can be really important, especially if you’re supporting critical industries like the air travel industry where even the slightest bit of contamination in jet A fuel can cause an entire tank to need to go be reprocessed. And, of course, if you lose a tank, you’re going to have an interruption in service as well. So, maintaining the quality of your product that you are receiving, and selling is also a critical challenge faced by these operators.

Jim: Wow. That sounds like they’re critical in the supply chain and for us as consumers would miss them greatly. And it sounds like most of those challenges you just described that measurements are really important and that fiscal measurements and custody transfers of some of it. So, what have been some traditional ways of performing these fiscal measurements and what’s been some of the drawbacks?

Marc: Well, the fiscal measurements are generally performed by flow meters and then those measurements are verified by maintaining a good monitoring of the inventory balance within terminal itself and individual tankage. So, they use level measurement and tank strapping to keep track what the instantaneous inventory within the terminal is, and then they use that to go and verify that what they thought they had is indeed what they have. And that’s where my reference to the term overs and shorts comes from. In comparing the official measurement that’s been made by flow meters to what they think they have in their inventory, they will end up with these overs and shorts, which ends up being pretty much the main metric that they use above all else to determine how well their measurements are doing.

Now, some of the older technologies that have been used for years and years include mechanical-type meters that have rotating parts like turbine meters and PD meters, which are very common. The problems that these have sometimes are related to that mechanical motion and how it can be effected by changing fluid properties or debris or contamination that unexpectedly comes through the pipeline entering or exiting the terminal, and that can have a permanent effect on the measurement accuracy of those types of devices.

So, they address that by performing an in-situ check of their measurements pretty consistently. What’s called proving is when they bring in a separate device or sometimes, they’ll even invest in having a stationary prover device that is used to check the meters. Now, the prover is they’re tied to the chain of traceability, which gives them credibility by linking it to the national standards. And they build this chain of traceability by calibrating the prover against other traceable standards all the way back to the national standards that we keep in Washington at NIST. And by maintaining that chain of traceability with good measurement practices, they can use the prover to check the meter, and then they use the meter to measure the fiscal measurements that are used for billing and invoicing.

So, it’s a complex system and a network of interconnected measurements that results in the measurements that determine what people are paying each other as product is traded. The proving exercise will reveal when meters are changing, and that’s a bad thing. I mean, it’s very common for old-style mechanical turbine and PD meters to change all the time either because of changing fluid properties or just because of wear and tear over time. So, that’s somewhat expected. But what the industry is learning now is that newer technologies don’t expose them to that kind of constant change and measurement accuracy, and Coriolis meters are a good example because they tend to be consistent over long periods of time and over widely ranging fluid properties and conditions and flow rates. So, that just builds general sense of confidence in those measurements because if the proving exercise is showing you that your measurement accuracy is stable and consistent, then you don’t have to worry about what’s going on in between those events where you’re checking against the prover.

Jim: What is it about Coriolis technology that makes it, I guess, able to hold up and be more accurate over time compared with some of these traditional ways?

Marc: Well, first and foremost, just at a very fundamental level, a Coriolis meter does not have rotating moving parts. And the technology is very, very sensitive to flow, but because it doesn’t have any parts which wear or tear or gaps between rotating elements where product can slip through without being measured, it measures the mass flow rate of everything that goes through it. And the measurement doesn’t change because the meter’s not being changed by the flow going through it like other types of mechanical meters. The other thing that Coriolis meters offer is advanced diagnostics, which are not possible with older technologies that stem from the ability of the advanced electronics, which are attached to them to interpret many different signals.

And that’s also how the flow meters can be used for either mass flow or volume flow measurement. A lot of these terminals need to be able to measure in either mass or volume as they’re receiving liquid and gas products, and sometimes both depending on the products and how the products are traded on the market. And so, Coriolis meters have the ability to do both because they can measure mass and density and volume all at the same time. And that provides yet one other advantage in terms of the flexibility of being able to use the same type of device for all your applications, whether you’re required to report the totals in volume units or in mass units.

Jim: So, it sounds like the newer technology of Coriolis versus PD or turbine meters or something gets you a lot more reliable measurements, accurate measurements over time. So, how did those diagnostics, the smart meter verification work along with meter provers in this way to get better accuracy or meet the requirements for the fiscal measurements?

Marc: Well, that’s a great question, Jim, and I’m glad you asked because it gives me an opportunity point out that meter proving is used for any type of meter, whether it’s a Coriolis meter or a PD or turbine meter or any other type of meter would also be proved. And the reason for that is because the fiscal risk of not maintaining that chain of traceability is too great. The big difference that people are finding between Coriolis meters and other types of meters is that the philosophy of meter proving which evolved over the last 100-plus years has been based on the idea that a meter gets built and you don’t know how it’s going to measure until you’ve installed it and started using it and checked it with a prover.

And furthermore, the expectation is that it’s going to be different tomorrow than it was today. So, meter proving is something that PD and turbine meters have always relied on to constantly maintain accuracy. And without meter provers, operators would have no way of maintaining a meter factor adjustment for those types of older meters that they could be confident in. But with a Coriolis meter, what they’re finding is that meter proving is more of a formality. So, instead of relying on meter proving to come up with today’s new meter factor, a Coriolis meter, when it’s proved is usually more of an exercise of just demonstrating what we expected, which was that the meter factor for today is the same that it was yesterday.

So, it becomes less of an essential part of the measurement adjustment that turbine and PD meters rely on and more of a verification. Now, smart meter verification diagnostic is something that our Micro Motion meters include, which is an advanced diagnostic tool that can be used to detect those very rare instances because even a Coriolis meter is not completely devoid of potentials for damage. So, for example, if you have a case where you fill the meter full of water and it freezes solid, and that permanently deforms the tubes inside in a way that changes the structure of those tubes, the metal structure by plastic deformation, or if you were to have chemical that’s not compatible with the metal and actually corrodes the metal or erodes the metal, that would be something very unusual, but it can happen.

And so, smart meter verification is a diagnostic tool that’s designed to very easily and very quickly detect some of those rare cases where something actually that could impact the measurement of the meter has happened. So, if you combine that together with the proving exercise, what you get is a very easy test because the smart meter verification test takes almost no time at all. It costs nothing to run after it’s been installed and set up, and it can run automatically without interrupting your process. You can continue to flow normally and run your process as you would and it will still give you a valid answer of whether damage has occurred to the meter or not.

So, combine that with the proving exercise and you have an additional tool that can give you confidence that none of those unexpected things that could have affected the meter factor or the accuracy of the meter in between the times that you’ve been able to test it with a prover for good traceable verification and that gives you even more confidence in the measurement that’s happening day in and day out from one second to the next at all times. And so, operators are able to use that additional confidence to actually save money and improve the overall terminal operations availability by spreading out the interval that they have to prove the meters in a way that saves them overall cost of proving, and also avoids the interruption that proving can sometimes bring to their overall operations.

Jim: Yeah. The picture you painted, I just envisioned that operations and maintenance gets a whole lot easier, plus you have much more confidence in the measurement. Like you said, it’s a formality when you go to prove because they’re so in, they’re so all those big challenges that you talked about in getting more accuracy in the product custody and loss control risks and all that seems like it just makes things run a lot more efficiently. So, that’s a great discussion. So, where can our listeners go to connect with you and go and learn more about opportunities for better measurements and more efficient operations?

Marc: Well, there are plenty of places they can go, but before I answer that, I just want to add one more thought in response to what you just said, which is that yeah, as I said, it couldn’t be easier to operate Coriolis meters compared to their older technologies. But part of the reason for that is because they require no scheduled maintenance. There’s nothing you need to do on a regular basis. And even the smart meter verification is only a check which can be scheduled to run automatically. So, that can all be done in background and doesn’t need to be done manually.

But to answer your question about where to go to learn more, I would offer that you can visit the emerson.com website. And, in particular, if you want to hear more in this podcast series, emerson.com/terminal-capacity is your ticket to that. But if you want to learn specifically about Coriolis meters, there’s even a shortcut that you can use, which would be micromotion.com, which takes you to that part of the emerson.com web environment, where you’ll immediately arrive on the Coriolis meter webpage and you can learn more there. There’s lots of educational tools as well as information about our products. And if you have a direct question for me, you can reach me at my email address, which is marc.buttler@emerson.com. Or you can look me up on LinkedIn and just search for my name, Marc Buttler, that’s Marc with a C and Buttler with two Ts.

Jim: Well, thank you so much for giving our listeners ways to connect with you and where to go on the site. And I’ll echo what you said that in the Coriolis meter section of the website, there’s great videos, there’s great basic explainers, everything else. So, if you don’t know a lot about their operation, really great learning resources in there and also the optimize terminal capacity area for this and other technologies to really drive more optimized storage terminal operations. So, Marc, thank you so much for joining us today.

Marc: Well, it’s been my pleasure, Jim, and thank you for inviting me.

End of transcript.

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