Ensuring Pipeline Integrity with Better Vendor Transparency
Read how a top Midstream Company that carries 30% of US oil and gas through its pipelines partnered with WellAware to improve chemical vendor transparency, reduce costs, and improve asset integrity and flow assurance programs.
About the Customer
The customer in this case study is a U.S.-based midstream energy company with nearly 100,000 miles of pipelines in a majority of US states. The oil and gas firm focuses on natural gas, liquid natural gas, NGLs, refined products, and crude oil.
Corrosion and hydrate formation killing efficiency
Corrosion and rust are detrimental to oil and gas infrastructure. They can cause leaks, environmental contamination, and – worst case – major explosions that take people’s lives. As a result, energy companies have to prevent corrosion at any cost. Of course, this is difficult for large operators like this operator that have tens of thousands of miles of pipeline.
Hydrate formation is another problem that many oil and gas companies face. Hydrates often form in below-freezing temperatures when water molecules bind together in natural gas streams. They can cause significant pipeline blockages and damage compression systems. With over 200 compression stations, the operator needed a scalable, yet cost-effective way to guard against hydrate formation.
“Moving as much gas as we do, and having as much pipeline as we do, compression is everywhere,” says the Vice President of Operations. “Our biggest expense in this business is labor, and the second is oil for compressors. When compressors don’t run efficiently, that increases our oil costs.”
We used to operate on the idea that “if 2 gallons of methanol is good, then 20 is better,” but that leads to methanol waste, and methanol is expensive, so we wanted to have some control over that cost.”
– VP of Operations.
High chemical spending with legacy vendor
Pipeline companies typically rely on specialty chemicals and oilfield chemical service providers to address corrosion, rust, and hydrate formation. While necessary in most cases, this approach can get costly.
The operator was spending more than $20M annually on specialty chemicals, nearly 10% of the company’s overall OPEX budget. Yet, they weren’t getting the level of service it expected for that amount of money.
The pipeline operator continued to struggle with corrosion and compression efficiency issues. The company experienced pipeline downtime, loss of sales, lower revenues, unexpected remediation costs, and safety incidents.
No visibility into chemical program ROI
On top of that, the operator wasn’t sure whether it was generating an effective ROI on its methanol treatment program. The company used millions of gallons of methanol every year to prevent pipelines from freezing, but over-dosage was likely a rampant issue.
“We used to operate on the idea that ‘2 gallons of methanol is good, but 20 is better,’ but that leads to methanol waste, and methanol is expensive,” says the Ops VP. “So we wanted to have some control over that cost.”
In light of these challenges, the operator determined it needed to minimize chemical injection loss and optimize its methanol injection program. Although they had worked with a chemical services partner for more than 25 years, the company began to explore supplemental solutions to gather more data and improve chemical program transparency.
With the right technology, the operator believed it could keep its chemical services provider more accountable for outcomes, as well as ensure its IT infrastructure remained safe and secure at all times, especially in light of recent cybersecurity attacks on pipeline operators.
Vendor Chemical Usage Monitoring
The midstream company turned to WellAware to pilot a remote monitoring solution. The operator specifically wanted to track, control, and automate its corrosion and methanol inhibitor injection programs. WellAware offered these capabilities through the Connect platform, which came with robust cybersecurity measures that passed an extended security audit process.
Through WellAware Connect, the company implemented tank level monitoring to stay on top of chemical inventories and usage. The tank level monitors identify when tanks are nearly empty, as well as when chemicals are no longer being injected
[With WellAware] we could see what was going on with our pumps and control the injection rates remotely without needing to have a guy out there. When you have as many miles of pipeline as we do, it’s hard to get to every site.
– VP of Operations
Chemical pump monitoring and failure alerts
WellAware Connect also provided the operator with a way to monitor and control chemical injection pumps. The monitoring platform enables operators to keep pumps online by notifying when failures occur.
“[With WellAware] we could see what was going on with our pumps and control the injection rates remotely without needing to have a guy out there,” reports the Ops VP. “When you have as many miles of pipeline as we do, it’s hard to get to every site.”
Wireless temperature monitoring optimizes methanol use
In addition, the pipeline company used WellAware’s Sense platform to monitor pipeline temperatures. The Sense program comes with Class I Division 1 Explosion Proof devices that operate on only two 3.6V lithium batteries. They also integrate wirelessly with the Connect platform. Sense devices take temperature readings every five minutes, alerting when conditions drop below freezing, critical intel for managing methanol injections.
For all installations, the operator relied on WellAware’s network of licensed, safety-trained Certified Automation Partners. The installation process was fast with zero safety incidents or near misses. Furthermore, WellAware provided its customer with custom-built chemical performance dashboards that allowed operators to visualize key chemical program performance data and discover issues quickly.
WellAware manages and maintains all of the hardware, connectivity, and software associated with its solutions, saving the operator time, money, and effort on this asset integrity oversight project.
Eliminating and correcting pump failures
WellAware’s Connect platform allowed the pipeline company to identify numerous issues within a few months. Some were due to poor chemical program management by the third-party service provider. Others were driven by poor communication and a lack of transparency.
One of the operator’s biggest wins was discovering that it suffered from a 25% pump power failure rate. Batteries designed to sustain chemical injection pumps during the night – when solar panels stopped charging – were failing at an alarming rate, resulting in a complete loss of injection. With WellAware, company personnel and chemical service providers now get notified immediately when pumps fail, which is how the company was able to cut power failure occurrences in half in the first quarter after implementing WellAware.
Improved vendor transparency for better relationships
Additionally, the midstream company was able to build a stronger relationship with its specialty chemical vendor. Responsibilities and performance benchmarks are much more clear than they were previously because both companies have high-quality injection data.
The Operations VP appreciates this new level of visibility: “[The benefit is that] we know how much chemical we actually use, that the invoice we are paying is what we’ve actually used. We are getting protection in our pipelines and minimizing chemical waste.”
After a successful pilot across approximately 20 locations, the operator has expanded WellAware’s remote monitoring platform to several hundred sites. The oil and gas company has exactly what it needs to scale and optimize its chemical program without adding more complexity to its operations.
PUMP FAILURE REDUCTION
We know how much chemical we actually use, that the invoice we are paying is what we’ve actually used. We are getting protection in our pipelines and minimizing chemical waste.
– VP of Operations
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