UNIT - 1

Question and Answers

Long Questions:
1. Describe the purpose/ importance of pipelines in petroleum industry.
In the petroleum industry, pipelines are used for a variety of purposes. These include: Gathering crude from individual leases and delivering it to a central location for processing, Transporting crude oil from fields to port terminals for tanker transportation, Moving crude oil from processing centers and supply points to the refineries and other market destinations, Moving gas from fields to gas processing plants and from these plants to markets or LNG facilities, Distributing petroleum products from the refineries to the distribution centers. The products from the field or the processing facilities cannot be consumed in the area of their production. The products need to be transported for consumption. Various modes / alternatives are available for the purpose. Different modes as conceptualized are required to be listed and analyzed separately wrt conditions /factors involved that may affect complete process design, availability of the state of the art technology, availability of resources (men & materials), Finance, products marketing/ purchase commitment etc throughout the project life & most importantly based on which the techno economic studies have been prepared for the conceptualized project. The most economic alternative is selected from the above conceptualized projects. The project remains economical till the time the project implementation is without cost overrun and time overrun. Pipelines perform vital functions. They serve as arteries, bringing life-dependent supplies such as water, petroleum products, and natural gas to consumers through a dense underground network of transmission and distribution lines. They also serve as veins; transporting life-threatening waste (sewage) generated by households and industries to waste treatment plants for processing via a dense network of sewers. However, as our highways and streets become increasingly congested with automobiles, and as the technology of freight pipelines continues to improve, the public is beginning to realize the need to reduce the use of trucks and to shift more freight transport to underground pipelines. Underground freight transportation by pipelines not only reduces traffic on highways and streets, but also reduces noise and air pollution, accidents, and damage to highways and streets caused by trucks and other vehicles. It also minimizes the use of surface land. Surely, we can expect an increase in the use of pipelines in the 21st century.

2. Compare various modes of transportation and their limitations and advantages.

Tankers are generally cost effective for medium to large volumes when transported over very long distances. They also offer flexibility in loading and unloading point. They can be chartered at short notice (when available) without any capital cost. Tankers are usually employed in combination with a pipeline at the export and/or import location. Rail cars are mostly used for products, but have been used to transport small and medium quantities of crude oil where there is existing rail infrastructure.

Figure 1 Road transportation by truck is viable only for transporting small quantities over short distances. Road transportation is mainly used for products, but has been used for crude oil. Barges are mainly used for transporting products over short to medium distances. They are normally used in coastal areas or where there is an existing river/canal infrastructure. Barges, rail and road are usually only attractive for transporting small volumes over relatively short distances. Pipelines, on the other hand, can be used for oil, gas and products, and are usually the only viable option for gas. Pipelines can be used over a range of volumes and distances. However, for very short distances and small volume or seasonal demand or for very long distances, Pipeline is unlikely to be cost effective. Figure 2 illustrates the unit cost curves for various alternatives. Figure 1 shows the different methods available to transport crude oil or petroleum products.

3. Comment on benefits and limitations associated with pipeline mode of transport.

Cost comparison among modes of transportations: Pipelines are most cost-effective for higher ranges of Cost/ ton-km. For small volumes and/or for short distances, Pipelines are not very economical; in such cases, other alternatives should be considered. The Cost comparison is shown as under:

The economy of pipeline transport as an alternative to any other form of transport arises from the following: (a) Pipelines are able to move voluminous batches of fluids uninterrupted in a continuous stream over long distances at a low unit cost and low risk. Although the transit speed is low (estimated to be between 5 and 15 km/h), commodity intake, carriage and discharge are combined in one process the commodity is immediately discharged into storage tanks upon arrival. This, coupled with the fact that the pumping process can take place continuously, without the need for a return journey or empty running or stoppages or transshipment delays, reduces the total transit time. (b) A commodity which is transported by pipeline to its destination requires no wrapping and packaging. Only the commodity itself moves, the pipeline provides the necessary containment and protection of the commodity. Therefore there is no dunnage dead weight, dunnage volume as well as movement of vehicle or handling equipment. There also are no empty containers to be stored, handled or returned to the origin and no packing or unpacking problems at the start and completion of the haul. (c) Among all transport modes, pipelines require the least human resources expenditure and consume the least energy per unit of commodity moved. Fuel consumption by road tank trucks, for example, is several hundred times higher than pipeline to deliver the same quantity of commodity. (d) Pipelines are the safest mode of transport to carry petroleum commodities. There are an extraordinarily small number of deaths and injuries associated with pipeline operations. The high degree of automation throughout pipeline systems accounts to a large extent for their outstanding safety record, because human error is the principal cause of most transport accidents. High standards of design, construction, testing, preventive maintenance and monitoring techniques also contribute to the great safety of pipeline transport. (e) The goods security record of pipeline transport is outstanding. The risks of shrinkage or loss by theft, fire, damage, spillage and evaporation are insignificant. However, laying a pipeline in Geographical unstable areas and locations where surface conditions are affected detrimentally by mining activities has to be avoided. Electronic monitoring of facilities as well as insignificant influence by the elements, results in minimal loss and damage (through quick detection of leaks) and in highly reliable delivery schedules. The high accuracy and reliability of forecasted delivery times diminish the need for safety stock at the receiving end, while free storage is offered for as long as the order is on the way to delivery. (f) Large areas of land are not diverted to exclusive use. The area required is a narrow ribbon, and diversion of land from other uses is lessened if the pipes are buried beneath the surface of the ground (as they usually are). In addition to the productive use of internal pipe volume, pipeline transport is very economic in utilization of external space. Once the pipeline is laid, the land above it can continue to be used for alternative purposes, except for activities that disrupt the ground surface seriously and the construction of permanent structures, subject only to the right of access for the pipeline operator to conduct inspections or when repairs and replacement become necessary. This lessens the opportunity cost of a pipeline right-of-way. Once location and construction problems have been overcome, pipeline transport causes the least external cost and ecological damage of all modes of transport. (g) Pipeline transport can offer international service. However, such services were confined to Overland crude oil and natural gas supply, and in limited cases petroleum products carriage between neighboring countries. Although pipelines can be built under the sea, such a process is both economically and technically highly challenging, so the majority of oil at sea is transported by tank ships. All international trade of crude oil and petroleum products that involves long-distance and trans-oceanic carriage is done by ship. Despite the fact that tank ships run empty during return trips, pipeline transport can only compete with sea transport between the same origin and destination if the pipeline route is considerably shorter than the sea route, or where sea transport is subject to exceptionally high charges.

In general, pipelines offer the following advantages over other modes of transportation: Low unit cost ($/ton/km), High reliability, such as immunity to weather condition among others, Safety (low number of incidents/km/year), Low environmental impact, including low spillage, High land utilization. Right-of-way may use multiple lines. For the volumes and distances encountered in typical Exploration & Production applications, pipelines usually offer the most cost-effective solution. When compared to other forms of transports, pipelines are considered one of the safest forms of transporting hydrocarbon. Although during the construction phase, some limited environmental impact is unavoidable, during the operational phase, pipelines have the least environmental impact compared to other modes of transport. Limitation of pipeline transportation of Petroleum, Petroleum products & Natural gas Pipelines on the other hand, do have certain disadvantages, including:

Fixed location, High capital cost, Long lead-time for construction, and Limited throughput flexibility.

Once installed, a pipeline offers no flexibility to change inlet or outlet point. Although operational costs are low, pipelines are relatively expensive to install and usually take 2 to 3 years to become operational. Moreover, a pipeline presents only limited flexibility with respect to throughput changes.

4. Explain feasibility study of pipeline development in detail.

Feasibility Study: A project begins with a feasibility study. The objective of a feasibility study is to investigate and establish whether a prospective project merits further consideration. Usually this phase is spearheaded by the sponsor department, with engineering, cost and market specialists playing significant roles. Several alternative engineering options are typically developed. Each option is fully evaluated with respect to the following:

Physical, technological and statutory constraints, Project options o Advantage and disadvantages, o New/novel techniques required, o Possible problem areas, o Resource requirement, Areas requiring additional data, Technical risk evaluation, and Capital and operating cost estimates (accuracy +/- 25 %)

Preliminary design at this level is limited to system layout, capacity requirement, calculation of preliminary pipe diameter and wall thickness, material selection and corrosion protection. In offshore projects, the method of installation is also identified. Feasibility study includes but not limited to the following: Planning and Evaluation: Before initiating a pipeline as a commercial venture, it must be shown that for the economic life of the pipeline the users will ship sufficient volumes at the established tariff to enable the owners of the pipeline to repay their loan, meet the operating and maintenance costs, and return a profit to compensate for the risk element and warrant the investment. The disadvantages of pipeline transport lie mainly in its extreme functional specialization and dependence upon sustained high volume traffic. The initial cost of installation is high and justified only when both the demand and supply will continue for a long time. Exhaustion of wells brings the utility of the pipeline to an end and its salvage value may be low (i.e. the sunk cost proportion is high). For this reason (in oil producing regions) gathering pipelines are mostly laid on the surface of the ground, because they may need to be moved from time to time as wells become depleted. When the opening of a new oil-producing area is considered, geologists need to confirm the significance of the oil find, estimate the reserves and determine production capacity. This is the basis for estimating expected throughput. Petroleum industry specialists study potential markets and the value of future production. They forecast conditions that might affect the pipeline, directly or indirectly, over the next 15 to 20 years, such as the state of the economy; shifts in population; product demand growth; refinery construction; expansions and shutdowns; domestic and foreign crude oil production; prospects for competitive pipelines; industry changes; and government actions. These aspects are considered in detailed technical, financial and economic appraisals. Technical appraisal is concerned with, among other aspects, physical, design and environmental matters as they relate to the construction process and the operation of the project after it is completed. The financial evaluation process focuses on the business and financial details, primarily the expected costs and revenues of the enterprise responsible for the project. Financial appraisal is used to determine the quantum of funds that will be required and whether the venture is likely to be financially viable that is, whether it can meet its financial obligations, produce a reasonable return on the capital invested, and make a contribution from earnings toward the cost of future investments. If the pipeline is a joint venture, those involved form a company, secure throughput agreements and arrange for financing.

Economics of pipeline transportation

The Economic Assessment of a pipeline necessitates the investigation of several alternatives in order to determine whether the project is justified in terms of the economic resources its commercial existence will require. Firstly, alternative locations/ routes for laying of the pipeline may have to be compared. The shortest and most direct alignment between origin and destination might initially be preferred (for example, in the case of a crude oil pipeline that delivers its entire payload at one destination). However, deviations may be necessary because of topographic obstructions and other environmental considerations, present land uses, difficulty in obtaining rights-of-way, and the need to pass near some supply or delivery point or to skirt heavily populated areas (for example, in the case of a products pipeline that has delivery points along the route). Bearing in mind that the largest delivery point (or customer) is usually the one at the end of the line, the route alignment should not be located so circuitously that it unnecessarily puts the customer(s) at the end of the line

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at a distance and tariff disadvantage in favor of intermediately located delivery points/customers. In this case the economic trade-off is between a circuitously located pipeline and one with a direct alignment, but with small lateral branch delivery lines along the way. A second consideration may be the size of the pipeline, since one with a larger diameter, able to handle a greater traffic volume, involves higher initial investment cost but lower costs for pumps and energy to propel the pumps. Large-diameter trunk pipelines are an important factor in making it viable to extract crude oil in remote regions and convey it to refineries or exporting seaports. This is because the unit cost of transporting commodities by pipeline decreases as the diameter of the pipe increases. This economy requires that the total quantity handled be sufficient to keep the pipeline full. A prerequisite for successful pipeline transport is proper sizing for the quantity of oil that will be carried. A third decision concerns the choice of pump technology. Most pumps are driven by electric motors, although diesel engines or gas turbines can also be used. The benefit of electric propulsion is its low cost and the economy of remote-controlled operation. However, with the likelihood of high electricity price increases and that service reliability can be jeopardized by electric power failures, diesel propulsion may become an economic contender for electric propulsion. A fourth important consideration is whether the refinery should be located at the beginning of the line (upstream, close to the oil field or the port of entry) or at the end of the line (downstream, close to the market). The need for the latter investigation arises from the fact that the cost of carriage varies between commodities. The greater the viscosity and the density (i.e. mass in relation to volume) of the commodity to be carried, the more difficult it is to pump and therefore the higher the cost. For example, crude oil is substantially more expensive to carry over long distances than the lighter and more fluid petroleum products that are refined from it. The greater the volumes to be carried and the longer the distance concerned, the more economical it may become to locate the refinery at the lines origin. Upstream refinery location also enables the provision of downstream delivery points along the line, which can improve the efficiency of product distribution. The fifth step in the economic evaluation is to compare the pipeline cost with the cost of the next best transport alternative, which is usually rail transport. If the above-mentioned investigations indicate that a pipeline promises to be technically feasible, financially viable and economically justified, detailed design of the pipeline may commence. The major feature in the system's design is the pipe, even though it is usually almost entirely buried. Selecting the specific pipe for a given project is affected by economic factors as well as by the nature of the commodity, expected throughput, terrain and construction conditions. Market Structure and Ownership Patterns Pipeline transport is usually provided by private users for their own (ancillary) purposes, or by common carrier acting on behalf of all the shippers linked to the pipeline. The supply of pipeline transport, in terms of the number of market participants, is the most highly concentrated of all transport modes. The absolute number of firms is low, but the significant measure of concentration is the number of participants in a specific transport market segment or transport corridor. With a few exceptions, there is but one crude oil, one products and one natural gas pipeline connecting producing areas or refineries and areas of consumption. High degree of monopoly power results from declining unit costs with increases in capacity, so that the lowest costs are achieved by a concentration of output in a single pipeline. A high degree of concentration is efficient, and changes toward a more competitive market structure through economic regulation would entail high losses

in efficiency. Therefore, pipeline operations that can fulfill entire market demand are pure natural monopolies. Where the distance between supply points (such as geographically separated oil fields or ports of entry) is high in relation to the delivery distance to the market area, such an areas fuel demand can often be most efficiently fulfilled by two or more different pipeline operations. Because of the high capital costs of a pipeline, the financial barrier to entering the market is high. Owing to the inflexible capacity limits of a pipeline once installed and the maximum flow rate at which pumping can take place, a new method of moving the product (such as by road or rail) needs to be found once the flow rate reaches pipeline capacity and replacement with a pipe of larger diameter or a second pipe is not feasible. In view of the above-mentioned considerations financial stakeholders in pipeline operations tend to consolidate and start with a large initial investment, which tends to yield higher returns, partly because of economies of scale and partly because of inherent performance characteristics (for example, a 30-cm pipe operating at capacity transports three times the quantity carried by a 20-cm pipe). The gains from scale are substantial. For example, the lowest cost for a throughput of 100,000 barrels of crude oil per day in a 45-cm pipeline would be approximately double the cost per barrel when compared to carrying 400,000 barrels per day in an 80 cm pipeline over the same distance. The implications for the industry are important. It would be extremely wasteful, for example, for four competing refineries in a consuming area in which each used crude oil from the same area of origin to build four pipelines. If, for example, each required 100,000 barrels per day, then building four parallel 45-cm pipelines instead of a single 80-cm pipeline would double the cost per barrel for transport. Efficiency dictates a common system for use of the same pipeline in such circumstances. It also follows that costs for carrying petroleum on a route that has a large pipeline will be much lower than on other routes not thus provided. There will be external economies in locating large refining capacity in the same area.

COST STRUCTURE: Pipelines provide their own right-of-way. Once the investment is made, the
remaining operating costs are low. Since the pipe component, the pumps, and the tank and plant facilities are highly specialized and durable, fixed cost constitutes a high portion of the total cost the highest proportion of all modes. Fixed Cost: The fixed costs of pipeline transport can be classified in a sequence from almost permanently fixed through to items those are fixed for a one-month period: Pipeline right-of-way (right-of-use); Pipes; Storage facilities; Operations-related terminal buildings; Pumps;

 Management and administration overheads; Routine maintenance of facilities, pipes and pumps; and Monthly charge for a continuous minimum availability of electricity supply. In the construction of the long-run cost function, the three principal fixed cost components are as follows: (a) Those that change with pipe diameter; (b) Those that change with pumping power; and (c) Those that change with length of pipeline. Fixed costs that change with pipe diameter include the interest and the depreciation on the pipeline itself, the costs of constructing/laying the pipeline, the costs of steel, pipe coating, valves and corrosion protection, and scheduled maintenance costs of the pipeline. Although these costs rise as pipe diameter increases, the rise in costs is less than proportional to the increase in diameter. For example: the width of the pipeline right-of-way (i.e. the cost of the servitude) remains the same regardless of pipeline diameter; in most cases the width of the trench in which the pipe is laid remains the same (or increases very little); whenever wall thickness remains the same or it increases to a lesser extent than the increase in the diameter, proportionally less steel is needed as the inside diameter of pipes increases; unavoidable routine inspection, monitoring and general management costs for a large pipeline are only fractionally more than for a small pipeline of the same length. Fixed costs that change with pumping power include the interest and depreciation on the investment in pumping stations and the outlays for electric power, plus the unavoidable labor used in the routine maintenance and the operation of pumping stations. Fixed costs that change with length of pipeline rise in direct relation with increases in distance. These costs include the initial costs of surveying and obtaining right-of-way and of the pipe, additional pumps, tankage, trenching and laying the pipe, backfilling the trench and restoring the surface, damages to terrain crossed, and scheduled (preventive) maintenance and operation of a communications system. Hence longer pipelines do not give rise to significant economies of distance, as directly proportional longer or more of each of these items is required for longer haulage distance. Furthermore, the terminal costs are relatively small. Thus the cost per ton-kilometer is sensitive to the regularity of flow but not to the length of the pipe. Consequently there is no distinct taper in the tariffs charged per ton-kilometer as the length of haul increases. Variable Cost: The only discernible variable costs (where variable costs refer to cost items with a commitment period of less than one month) in pipeline transport is the electricity (or other energy) consumed during pumping over and above the volume that is paid under the fixed availability charge, overtime wages paid to maintenance staff to repair faulty components, and the actual repair costs over and above routine or preventive maintenance. On the principle of economies of density, an increase in pipe diameter can result in a lower unit cost. An uninterrupted and prolonged throughput of a large volume of homogeneous commodity increases economies of density. Should such continuous pumping with a specific

commodity not be sustainable, common production can make petroleum products pipelines more efficient, since a variety of petroleum products can be pumped consecutively, thereby enhancing the achievement of economies of scale through economies of scope. The fundamental relationships involved depend upon the principles of geometry concerning the relation between the surface of a cylinder and its volume. Consider a circular cross-section of a pipe: because the area of a circle is r2, the area of the circle will increase with the square of the radius. The circumference will increase only in proportion to the radius, since the circumference is 2r. The friction that must be overcome to move a liquid commodity through a pipe is the friction between the liquid and the wall of the pipe. Therefore, increasing the diameter of a pipe will increase the quantity of liquid in the pipe faster than it will increase the area of the wall of the pipe in contact with the liquid. Consequently, there are gains in economies in the propulsion power required to pump the same quantity of commodity from increasing the diameter of the pipe. There are also economies in the cost of the pipe itself: For larger pipes the number of tons of steel for casings per unit of pipeline capacity is less than for smaller pipes. The only effective limit on the diameter of a new pipeline comes from the demand-side of the market. There is no sense in building pipelines of larger capacity than will be used in the future. The economic problem in planning and pricing pipeline services is determining the lowest possible unit cost per ton-kilometer for the level of expected throughput. This, in turn, requires determining the optimum combinations of pipe diameter and pumping power required for each level of throughput. The size of the pipeline is important, since a larger one, able to handle a greater traffic volume, involves higher capital costs but lower costs for pumps and operations, and less electricity or other energy costs to run the pumps.

5. Explain designing of pipeline project.

Once the feasibility study has identified the best option, approval is usually given to proceed to the definitive phase. At this stage, a conceptual design is carried out in which the feasibility study is taken to a higher level. During this conceptual design stage, option selection, route survey, hydraulic analysis and any optimizations remaining from the feasibility study are carried out. Any outstanding issues remaining are addressed. Baseline documents such, as the Basis for Design (BFD), and Project Specifications are normally prepared. During conceptual design, the following factors are usually considered.

Projection of supply: reserves and production rates. Route selection, Line sizing based on o Hydraulics requirements, o Mechanical requirements, Corrosion and material selection, Corrosion protection, Coating requirements/selection, and Safety and environmental considerations, including environmental impact and risk assessment.

A detailed cost estimate is developed at this stage to prepare a firm budget proposal, which serves as the basis for final investment decision (FID). It is based on an estimate of material, construction, operating and

maintenance costs. Usually, the estimate for capital cost, at this stage is refined to +/- 15 percent accuracy. Operating costs at this stage is often modeled as a percentage of capital costs plus a variable charge based on per barrels of oil, or cubic meter of gas throughput rate. Economic Pipe Diameter: For a given flow rate of a given fluid, piping cost increases with diameter. But, pressure loss decreases, which reduces potential pumping or compressing costs. An economical balance between material costs and pumping costs is important for designing the pipelines. The optimum pipe size is found by calculating the smallest capitalization/operating cost; or using the entire pressure drop available; or increasing velocity to highest allowable. The economic diameter will be the one which makes the sum of amortized capital cost plus operating cost minimum. The total cost can be per unit time or per unit of production. An approximate correlation for estimation of economic diameter is as below: Am0.45 0.027 -----------------0.31 Where de m A

de =

= = = = =

Economic diameter, inch Mass flow rate lb/hr Fluid density, lb/ft3 Constant = 1.7 Viscosity, cp

Detailed Design After the final approval is given for the project to proceed, the detailed pipeline design commences. The design of a pipeline is a complicated process involving computer analysis, and is usually done by in-house specialists, engineering consulting companies or pipeline contractors. Pipeline design usually includes the following:
1. Route selection and survey, 2. Environmental impact and risk assessment study, 3. Corrosion and material selection, 4. Coating selection, 5. Mechanical Pipeline Design, and 6. Hydraulics Analysis and Line Sizing.

Route Selection and Surveying Several possible pipeline routes are surveyed by aerial photography and surface mapping usually during the conceptual design stage. The final route is selected to optimize its economic design, construction and cost effective operation with minimal environmental impact. The following factors are taken into consideration in selecting a pipeline route:

Safety of public, Safety of construction and operations personnel, Protection of the environment, Protection of other property and facilities, Geothermal and hydro-graphical conditions, Requirements for construction, operation and maintenance, National and local requirement, Terrain feature, topography and population centers, Economics considerations.

After finalizing the pipeline route, a detailed site survey is made, and the route is staked with firmly fixed markers. Offshore pipeline route selection includes considerations of the following:

Shore approach, Nature of the seabed, Avoidance of obstructed or rocky zones, Sea traffic, Undesirable bottom feature, and National sovereignty consideration.

Environmental Impact and Risk Assessment Study Environmental impact and risk assessment studies are a major consideration in selecting the pipeline route. Both short term and long term environmental impacts need to be considered. Short-term impact involves damages during the construction phase, while long-term impact considers the presence of the pipeline during its operational life and potential loss of fluid due to accident or pipe rupture. Normally, this work is contracted out to a consulting company, specializing in environmental impact studies. Corrosion and Material Selection Selection of the pipeline material type is a fundamental issue, which is usually decided during the conceptual design stage, but again revisited during the detailed mechanical design. The most frequently used pipeline materials are metallic. Non-metallic materials, such as GRP/GPE may be cost effective for specific lowpressure operation, especially when transporting corrosive fluids. See Pipeline Mechanical Design Considerations under the Mechanical Design subtopic for more information on pipeline material and property. Coating Selection All metallic buried pipelines need to be coated externally by a suitable anti-corrosion coating, supplemented by cathodic protection. The type of coating depends on operating temperature. Common coating types are Polyethylene (PE) and Fusion Bonded Epoxy (FBE), which may be used up to 60C and 70C respectively. Some higher temperature coatings are available but at significantly increased cost. For offshore applications,

asphalt enamel corrosion coating is often used, especially in combination with concrete weight coating. See Onshore Construction of the subtopic Construction for more information on pipeline coating. During detailed design, the same parameters considered in the conceptual study are re-examined, but in greater detail. The end product of detailed design is the Tender Documents. These documents usually contain the following:
o o o o o o

All basic project data Design data All specifications, Material list, All fabrication and construction phase drawings, and Company requirements, such as, Operational philosophies, Know-how, Standards, Practices, Procedures, and Contractual information.

Further discussions on detailed pipeline design can be found in the Hydraulics and Mechanical Design subtopics.

Medium Length Questions:

1. Explain the role of a pipeline engineer.
Pipeline engineering is a multi-faceted, complex and challenging occupation where you can apply your engineering skills to real time operations of the oil and gas industry. Oil and gas pipelines function much like a railway network, with long and short lines and numerous pick-up and drop-off points along the way. While trains carry people, freight, tankers and grain cars above the ground, pipelines move oil and gas products such as crude oil, natural gas and refined petroleum products beneath the ground. Products we use everyday such as fuel for our cars, or gas to heat our homes are transported through these pipelines. Pumping stations, storage terminals, gas compressor stations, pipelines, manifolds, and control systems are some of the facilities that Pipeline Engineers design, construct, operate and troubleshoot. What does a Pipeline Engineer do? Pipeline Engineers typically perform duties associated with: Planning and design Construction Integrity and corrosion control Troubleshooting Consulting and project management

Every field of engineering is used to ensure the safe and efficient operation of this vital component of the oil and gas industry. Pipeline engineering is a multi-faceted, complex and challenging application of engineering skills to real time operations of the oil and gas industry. Oil and gas pipelines function much like a railway network, with long and short lines and numerous pick-up and drop-off points along the way. Pipelines move oil and gas products such as crude oil, natural gas and refined petroleum products beneath the ground. Products we use everyday such as fuel for our cars, or gas to heat our homes are transported through these pipelines. Pumping stations, storage terminals, gas compressor stations, pipelines, manifolds, and control systems are some of the facilities that Pipeline Engineers design, construct, operate and troubleshoot.

2. Draw a general layout of a pipeline system. Name different types of pipelines.

VARIOUS PIPELINES Cross Border Pipelines, Cross Country Pipelines, Transmission Pipelines, Regional Pipelines, Spur Pipelines, Flow Pipelines, Group Gathering Pipelines, Dedicated Pipelines,

3. Explain various components pipeline.

1. Line pipe is the basic component of every pipeline. Line pipe is usually metallic, such as carbon steel or corrosion resistant alloy. Non-metallic materials are also becoming increasingly used. Line pipe is normally supplied from approved pipe mills in 12-meter lengths with a specified external coating. Pig Traps are required to allow the safe loading, launching, receiving and retrieval of pigs without disrupting the fluid in the pipeline. Most pipelines usually require routine as well as intelligent pigging to

3 4 5 6

7 8

monitor the condition and the integrity of the line. Pig traps are always installed on all pipelines, unless it can be justified not to install them. Block Valve Stations are used to isolate section of the pipeline and limit the release of line contents in the event of a leak or pipeline rupture. For liquid lines, the spacing is usually based on limiting potential spill volume for pollution consideration. For gas lines, spacing is mainly based on safety and economic factors. Topography and ease of access are also taken into consideration. Emergency Shut-Down Valves (ESD) are installed at both end of a pipeline to enable automatic shutdown of the line in the event of an emergency. A Slug Catcher is installed at the end of a multi-phase pipeline to intercept the liquid slugs and to ensure a continuous flow of gas into the receiving station. Cathodic Protection System is usually installed as a backup to the external coating to prevent corrosion of the external surface of the pipeline. A Pressure Protection System is required to protect a pipeline when the line pressure exceeds the Maximum Allowable Incidental Pressure (MAIP). Either a Pressure Safety Valve (PSV) or a High Integrity Pressure Protection System (HIPPS) is usually installed. A Telemetry System is required to permit pipeline monitoring and remote operation from a central location. Leak Detection System is often installed in a pipeline to warn that a leak has occurred. The requirement and the type of leak detection system depend upon the transported fluid, sensitivity of the environment and the location class.

Figure -4 illustrates some of the components of a pipeline.

4. Which are the factors considered while selecting a route for pipeline?
Several possible pipeline routes are surveyed by aerial photography and surface mapping usually during the conceptual design stage. The final route is selected to optimize its economic design, construction and cost effective operation with minimal environmental impact. The following factors are taken into consideration in selecting a pipeline route:

Safety of public, Safety of construction and operations personnel, Protection of the environment,

Protection of other property and facilities, Geothermal and hydro-graphical conditions, Requirements for construction, operation and maintenance, National and local requirement, Terrain feature, topography and population centers, Economics considerations. After finalizing the pipeline route, a detailed site survey is made, and the route is staked with firmly fixed markers. Offshore pipeline route selection includes considerations of the following:

Shore approach, Nature of the seabed, Avoidance of obstructed or rocky zones, Sea traffic, Undesirable bottom feature, and National sovereignty consideration.

5. Describe different types of cost associated with a pipeline project.

Pipelines provide their own right-of-way. Once the investment is made, the remaining operating costs are low. Since the pipe component, the pumps, and the tank and plant facilities are highly specialized and durable, fixed cost constitutes a high portion of the total cost the highest proportion of all modes. Fixed Cost: The fixed costs of pipeline transport can be classified in a sequence from almost permanently fixed through to items those are fixed for a one-month period: Pipeline right-of-way (right-of-use); Pipes; Storage facilities; Operations-related terminal buildings; Pumps; Management and administration overheads; Routine maintenance of facilities, pipes and pumps; and Monthly charge for a continuous minimum availability of electricity supply. In the construction of the long-run cost function, the three principal fixed cost components are as follows: (a) Those that change with pipe diameter; (b) Those that change with pumping power; and (c) Those that change with length of pipeline. Fixed costs that change with pipe diameter include the interest and the depreciation on the pipeline itself, the costs of constructing/laying the pipeline, the costs of steel, pipe coating, valves and corrosion protection, and scheduled maintenance costs of the pipeline. Although these costs rise as pipe diameter increases, the rise in costs is less than proportional to the increase in diameter. For example: the width of the pipeline right-of-way (i.e. the cost of the servitude) remains the same regardless of pipeline diameter; in most cases the width of the trench in which the pipe is laid remains the same (or increases very little); whenever wall thickness remains the same or it increases to a lesser extent than the increase in the diameter, proportionally less steel is needed as the inside diameter of pipes increases; unavoidable routine inspection,

monitoring and general management costs for a large pipeline are only fractionally more than for a small pipeline of the same length. Fixed costs that change with pumping power include the interest and depreciation on the investment in pumping stations and the outlays for electric power, plus the unavoidable labor used in the routine maintenance and the operation of pumping stations. Fixed costs that change with length of pipeline rise in direct relation with increases in distance. These costs include the initial costs of surveying and obtaining right-of-way and of the pipe, additional pumps, tankage, trenching and laying the pipe, backfilling the trench and restoring the surface, damages to terrain crossed, and scheduled (preventive) maintenance and operation of a communications system. Hence longer pipelines do not give rise to significant economies of distance, as directly proportional longer or more of each of these items is required for longer haulage distances. Furthermore, the terminal costs are relatively small. Thus the cost per ton-kilometer is sensitive to the regularity of flow but not to the length of the pipe. Consequently there is no distinct taper in the tariffs charged per ton-kilometer as the length of haul increases. Variable Cost: The only discernible variable costs (where variable costs refer to cost items with a commitment period of less than one month) in pipeline transport is the electricity (or other energy) consumed during pumping over and above the volume that is paid under the fixed availability charge, overtime wages paid to maintenance staff to repair faulty components, and the actual repair costs over and above routine or preventive maintenance. On the principle of economies of density, an increase in pipe diameter can result in a lower unit cost. An uninterrupted and prolonged throughput of a large volume of homogeneous commodity increases economies of density. Should such continuous pumping with a specific commodity not be sustainable, common production can make petroleum products pipelines more efficient, since a variety of petroleum products can be pumped consecutively, thereby enhancing the achievement of economies of scale through economies of scope. The fundamental relationships involved depend upon the principles of geometry concerning the relation between the surface of a cylinder and its volume. Consider a circular cross-section of a pipe: because the area of a circle is r2, the area of the circle will increase with the square of the radius. The circumference will increase only in proportion to the radius, since the circumference is 2r. The friction that must be overcome to move a liquid commodity through a pipe is the friction between the liquid and the wall of the pipe. Therefore, increasing the diameter of a pipe will increase the quantity of liquid in the pipe faster than it will increase the area of the wall of the pipe in contact with the liquid. Consequently, there are gains in economies in the propulsion power required to pump the same quantity of commodity from increasing the diameter of the pipe. There are also economies in the cost of the pipe itself: For larger pipes the number of tons of steel for casings per unit of pipeline capacity is less than for smaller pipes. The only effective limit on the diameter of a new pipeline comes from the demand-side of the market. There is no sense in building pipelines of larger capacity than will be used in the future. The economic problem in planning and pricing pipeline services is determining the lowest possible unit cost per ton-kilometer for the level of expected throughput. This, in turn, requires determining the optimum combinations of pipe diameter and pumping power required for each level of throughput. The size of the pipeline is important, since a larger one, able to handle a greater traffic volume, involves higher capital costs but lower costs for pumps and operations, and less electricity or other energy costs to run the pumps.

6. What is an economic diameter of pipeline ?

For a given flow rate of a given fluid, piping cost increases with diameter. But, pressure loss decreases, which reduces potential pumping or compressing costs. An economical balance between material costs and pumping costs is important for designing the pipelines. The optimum pipe size is found by calculating the smallest capitalization/operating cost; or using the entire pressure drop available; or increasing velocity to highest allowable. The economic diameter will be the one which makes the sum of amortized capital cost plus operating cost minimum. The total cost can be per unit time or per unit of production. An approximate correlation for estimation of economic diameter is as below: Am0.45 0.027 -----------------0.31

de =

Where de m A = = = = = Economic diameter, inch Mass flow rate lb/hr Fluid density, lb/ft3 Constant = 1.7 Viscosity, cp