Professional Documents
Culture Documents
A Case Study
Presented to the Faculty of Mechanical Engineering Department
College of Engineering
BATANGAS STATE UNIVERSITY
The National Engineering University
Alangilan Campus
A Final Requirement
for the Course subject PETE 418
Production Engineering 2
Submitted By:
Agozar, Angel Lyn B.
Fesarit, Joshua E.
Larios, Carla Joie A.
Lubi, Mary Joyce Cludette M.
Ramos, Filipe G.
Sontillano, Rommel Jame B
Submitted To:
Engr. Mary Joy S. Artienda
November 2023
College of Engineering – Department of Mechanical Engineering
CHAPTER I
PROBLEM AND BACKGROUND
Introduction
Oil and gas storage and transportation are essential for meeting the needs of global
energy demands, powering economies, and sustaining modern daily life. However, the business
is confronted with a slew of issues that jeopardize efficiency, safety, and environmental
sustainability. Vast quantities of oils are usually stored and transported in large volumes. During
storage or transport, and occasionally as the result of exploration activities, oils and other
oil-based products are sometimes spilled onto land or into waterways. When this occurs, human
health and environmental quality are put at risk. Every effort must be made to prevent oil spills
and to clean them up promptly once they occur. (Agency response, 2018)
Pipelines are the major arteries of the energy sector, transporting oil, gas and other crucial
products that fuel the American economy. Keeping these arteries healthy and free of defects is
critical as a failed pipeline can lead to significant property damage, injury, and death. Corrosion
is one of the leading causes of pipeline incidents with the U.S. Pipeline and Hazardous Materials
Safety Administration (PHMSA) data showing 18 percent of pipeline incidents on average were
caused by corrosion between 1998 and 2017. (Pipeline Safety Stakeholder Communications,
2018)
time if left unmitigated. As a result, early detection and mitigation are necessary to minimize the
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impact of corrosion,” Corrosion is the deterioration of a steel pipeline that results from an
This reaction causes the iron in the steel pipe or other pipeline appurtenances to oxidize
(rust). Corrosion results in metal loss in the pipe. Over time and if left unmitigated, corrosion can
cause the steel to lose its strength and possibly render it unable to contain the fluid in the pipeline
at its operating pressure. Because pipelines are extremely long-serving and critical infrastructure,
it is paramount for pipeline operators to maintain the physical integrity of pipelines. Fortunately,
there are effective methods for preventing and mitigating corrosion damage to pipelines,
including many that are very technologically advanced that deal with various types of corrosion.
The leak that causes corrosion can lead to Fire hazards since chemicals can react to
anything that is prone to happen in oil and gas storage and transportation processes. Oil and gas
gather static electricity in the oil and gas storage and transportation process, resulting in fire
hazards and even an explosion. Our oil and gas storage and transportation equipment is still
relatively backward and poorly designed, whose materials are not standard oil and gas storage
and transportation equipment not up to, in the course of operation of the equipment, due to the
continued operation of the equipment, the emergence of the phenomenon of high temperature
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and pressure inside the device, resulting in equipment damage, causing leakage of oil and gas,
In the process of oil and gas transportation, oil and gas through pipelines and equipment
at the time of its friction, piping and equipment due to material non-compliance, prone to static
electricity, explosion. Meanwhile, the related operations staff do not follow procedures and
ignore safety issues and gas storage and transportation, which are also one of the important
reasons for the oil and gas storage and transportation security risk issues. (HUA Jinsong, 2015)
According to Crude Oil Transport: Risks and Impacts (2015), the infrastructure the most
common risk associated with transshipment points are the technical failure and defects of
equipment such as an oil loader at a barge and truck-loading terminal that can cause oil to spill.
Cargo shipments may also be held for days at transshipment points before being transferred to
other modes of transport and they may not be monitored for leakage and/or accidental damages.
A case in point is the incident at the Port of Albany in June 2014, where 100 gallons of oil was
spilled from a stored rail car because of a pressure release valve. To respond to the increasing
supply of oil, transshipment facilities have begun to increase their oil storage capacity, which
According to Alkhaldi (2017), human error is also one of the factors that affect some
dead time in transporting and storing oil and gas. As recent industrial statistics in the oil and gas
industry have revealed a high rate of occupational accidents that were caused by human error
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and have a great toll on workers, workplace and environments, attention should be diverted to
investigate human error extensively even if some research has started to do so because still
various perspectives remain questioned till yet. Serious attention should be paid currently
The impact on human health of a spill occurring in a lake or river, which serves as a
source of drinking water for cities, can be catastrophic if the spill is not promptly contained. If
the oil flows into municipal or industrial water intakes, the consequences could entail substantial
financial losses for cities, businesses, and industries, totaling millions of dollars or more in
damages. Furthermore, there may be significant public health implications if communities are
not promptly informed of the danger. In addition, oil from a spill has the potential to seep into the
Over time the quality of pipeline performance declines due to structural degradation,
cracks caused by corrosion, defective welding or incidental damage from third-party activities.
The Enbridge pipeline spill near Marshall, Mich., on July 25, 2010, was caused by structural
failure in a segment of the pipeline where corrosion-induced fissures developed and eventually
The location and environment pipelines that run through diverse ecological areas that
may be home to endangered species and are sensitive to environmental degradation conditions
As evidenced by historical incidents, oil spills can significantly affect human health, the
environment, and the economy, irrespective of the transportation method involved. When
released, oil has the potential to seep into the soil, polluting groundwater. In aquatic
environments, such as open water or rivers, oil can quickly disperse. On land, spills pose risks to
recreational, agricultural, and forested areas in rural settings. Water-based spills can harm aquatic
ecosystems, impacting fish and wildlife habitats, including nesting and spawning grounds, and
leading to water quality issues that negatively impact both recreation and public health. (Crude
CHAPTER II
The main thrust of the study was to assess and evaluate the common problems
encountered in the downstream sector of the oil and gas industry, specifically the storage and
1. Assess the frequency and severity of the challenges encountered in the storage
1.2 Corrosion
2. Evaluate the effects of the challenges encountered in the storage and transportation
3. Research and devise optimization and mitigation plan to counter the challenges in the
3.1 Leakage
3.2 Corrosion
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4. Present optimization plans and connect it to the industry and its effect in the long run
in terms of:
4.1 Sustainability
4.2 Efficiency
CHAPTER III
RESEARCH PARADIGM
The study focused on the analysis and optimization of the downstream production
process, specifically the pipeline and storage sector of the oil and gas industry. The study
employed the input-process-output framework or model, which is commonly known as the IPO
model.
For the input stage of the framework, the researchers required a thorough understanding
of the terms used and found in the study, such the downstream production process, pipeline
networks, storage tanks, characteristics and types of storage tanks, quality and quantity products
after logistics, and previous maintenance, optimization and mitigation plans for the pipelines and
storage. To ensure that the terms were correct and valid in terms of definitions, utilization, and
application, a thorough review was established during the process of research such as related
studies.
For the process stage, it started with gathering and acquisition of the data needed for the
case study. Information such as the primary challenges and common problems encountered in the
pipelines and storage. Narrowing down the information from its frequency and rarity of
occurrence in the oil and gas industry. As well as acquiring the recent data where leakage and
spill, corrosion, and material integrity took place in real life scenarios in the oil and gas field. at
the same time providing necessary evidence of the causes of these occurrences through research.
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Next is assessing and evaluating the effects of these challenges to different bodies of regulating
compliance, whether the product passed the intended quality of by-product since the oil and gas
industry is subject to numerous regulations and standards related to storage and transportation.
Ensuring compliance with these regulations is essential to avoid legal consequences and
penalties. As well as checking its compliance to the supply chain and logistics, the efficiency and
economically sustainable of the storage and pipeline. Coordinating the movement of oil and gas
products from extraction points to refineries and ultimately to consumers requires efficient
logistics and supply chain management. Delays or disruptions can impact the entire process.
Then, consider its effect on the overall safety and health of employees, since transportation of oil
and gas involves various safety risks, such as explosions, fires, and accidents. Ensuring the safety
of workers and the public is a top priority. Finally is the environmental impact consideration of
the challenges in storage and transportation, Since the oil and gas industry is under increasing
pressure to minimize its environmental impact. Spills, emissions, and other environmental
incidents can result in reputational damage and regulatory scrutiny. After assessment, devising an
optimal solution through data gathering from various research studies is done. The application of
various engineering concepts and theories are applied in the creation of the solution and
Lastly, on the output stage is the presentation of the mitigation and optimization plan
gathered from the research study while considering the sustainability, efficiency and the
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economic and budget impact after the application of solution after analyzing the challenges.
compliance, risk management, and proactive maintenance strategies to ensure the safe and
CHAPTER IV
According to the Oil Tanker Spill Statistics 2022, over the past 50 years, there have been
a lot fewer oil spills from tankers. From 1970, around 79 spills occurred annually on average in
the 1970s; by the 2010s to the present, that number of spills exceeding 7 tonnes had dropped by
more than 90% to just 6. Approximately, a total of 6 oil spills have occurred annually on average
so far this decade, which is equal to the average for the decade before it.
Figure1. Number of medium (7-700 tonnes) and large (>700 tonnes) tanker spill from
1970-2022
One of the major causes of the spill and leakages from the pipelines of the storage and
transportation is the corrosion followed by the excavation damage, human error, material failure,
natural force damage, outside force damage and others. Throughout the previous 20 years, there
half of these are usually onshore liquid pipelines; onshore gas transmission pipelines are the next
most common type. Surprisingly, the aging of the infrastructure has not affected the pattern,
which has remained relatively constant over time. The effectiveness of industry efforts at
corrosion control is attested to by the fact that the pipeline failure rate has not increased
Since most distribution pipelines are non-metallic and are typically found in more
densely populated areas, external force damage is far more common for distribution pipelines
field and the transmission system operator does not adequately clean and dehydrate the stored
gas before introducing it into the distribution system. The amount of water that can be present in
the gas that distribution companies deliver is limited by tariffs and specifications (whether from a
In the oil and gas industry, corrosion is a major problem when it comes to the storage and
transportation of petroleum products and biofuels. Tanks, pipelines, and other machinery used in
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the extraction, transportation, and storage of oil and petroleum products are seriously put in
danger.
Transporting and storing petroleum products presents a serious risk of corrosion. Steel
tanks are prone to corrosion from elements such as water, contaminants, and chemicals in the
products they hold. Over time, corrosion erodes tank structures, increasing the risk of leaks and
other environmental problems. Corrosion can occur in oil and gas transportation pipelines due to
internal and external factors. In addition to exposure to moisture, corrosive substances in the
Corrosion is a major factor in major failures of hazardous liquid and gas transmission
pipelines, according to data from the Journal “corrosion and its impact to pipelines”. It is
estimated that problems related to corrosion account for roughly 23% of these failures. Serious
repercussions from such mistakes may include product loss, pollution of the environment, and
According to the study of Ossai (2012), the oil and gas industry operates as a
capital-intensive business, encompassing assets such as drilling rigs, offshore platforms, and
wells in the upstream segment, along with pipelines. An analysis of major oil and gas companies,
including BP, Shell, ConocoPhillips, ExxonMobil, and Total, reveals that plant, property, and
equipment constitute, on average, 51% of total assets, valued at over $100 billion. Continuous
utilization and aging of facilities have resulted in a notable increase in failures within oil and gas
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plants. Research indicates that between 1980 and 2006, 50% of major hazard events in European
technical plants were attributed to aging mechanisms caused by corrosion, erosion, and fatigue.
approximately 6.2% of the GDP, making it the largest single expense in the economy. In the oil
and gas industry, corrosion contributes to over 25% of asset failures and is prevalent at every
stage of the production cycle. The price of oil and gas can be influenced by these factors, as
corrosion-related issues contribute to asset failures and increased maintenance costs, affecting
As for Supply Chain and Logistics, the offshore oil and gas industry has placed
approximately 40,000 miles of pipelines in federal offshore waters since the 1940s, with the
Bureau of Safety and Environmental Enforcement (BSEE) responsible for enforcing standards
and regulations to enhance environmental protection and safety. However, BSEE's oversight
processes for active offshore oil and gas pipelines in the Gulf of Mexico, spanning approximately
8,600 miles, lack robustness. The bureau relies on surface observations and pressure sensors for
leak detection but does not conduct subsea inspections, leading to potential inefficiencies in
detecting ruptures. BSEE faces challenges in managing environmental and safety risks associated
with decommissioned pipelines left on the seafloor. Decommissioning applications are not
thoroughly assessed for risks, resulting in over 97% (around 18,000 miles) of decommissioned
pipelines being left on the Gulf of Mexico seafloor since the 1960s. BSEE allows
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decommissioning-in-place based on certain criteria, but the high approval rate suggests it has
become the norm. According to Jhangiani (2020), corrosion issues during refining and
transportation necessitate the use of inhibitors to mitigate these problems. The economic impact
of corrosion extends to design costs, associated costs, capital costs, and control costs, ultimately
affecting productivity and efficiency. The transportation and storage of petroleum products are
also affected by corrosion, with internal corrosion in tanks and pipelines posing challenges that
The refinery of oil and gas required various processes that contributed to the
accumulation of corrosion in oil and gas pipelines during storage and transportation. A study by
Wood et al. (2013) on related accidents in refineries was based on a total of 99 reported accidents
in European Union (EU) and Organization for Economic Co-operation and Development
(OECD) countries from 1965 to 2012. It was revealed in the study that the majority of accidents
The main reason for these problems is corrosion, since it weakens the structural integrity
of pipes, resulting in leaks and the release of gas. It can be seen in Figure 4 that a leak was
reported that resulted in a total of 28 incidents of toxic gas release, including hydrogen sulfide,
24 reported incidents of fire, and 10 cases of explosion. A rupture was also reported, where a
leak that discharges a combustible substance that explodes inside a tank or pipe due to high
pressure resulted in nine reported incidents of toxic release, 18 incidents of fire, 19 incidents of
explosion, and two events that were undeclared. Moreover, it was evident that there are reported
events of structural collapse due to corrosion, and one incident of fire was reported.
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With these events, there are reported incidents where workers were exposed to toxic
substances during a pipeline leak, resulting in major health risks such as skin problems and
respiratory issues. Aside from that, the safety of the workers was endangered due to a fire and
explosion in the area, which then led to the collapse of a pipeline. According to their study, of the
total of 8 reported accidents since 2000, the number of workers injured totaled 219, and there
was no record of death. Furthermore, the safety and health of the workers are not the only ones
affected by these corrosion-related accidents, but also the equipment, environment, production,
and service that pose an economic impact. The figure shown below displays the other
consequences of accidents that occurred due to the failure of tanks and pipes. It can be seen that
57% of the accidents reported have affected production and thus projected a significant impact
on the economy, while 25% involved injuries and health problems for the workers. Moreover,
12% of the accidents resulted in the shutdown of the refinery, which may last four weeks or
months, depending on how severe the damage is. Lastly, 6% of the accidents have caused harm
to the environment, which is mainly associated with the release of toxic substances into the air,
As shown in the figure above, pipeline and storage leaks and collapses can have serious
repercussions in a number of ways. This includes environmental effects since the discharge of
hazardous gases as well as contamination of soil and water can damage ecosystems and affect
species. Also, there are economic consequences in terms of expenditures, legal responsibilities,
and recovery expenses, as well as possible industrial interruptions that may affect jobs. In
Figure 6 shows the causes of oil pipeline failures and PHMSA identified three major
causes of oil pipeline leakage namely:Equipment failure, Corrosion failure and Incorrect
operation. Equipment failure such as a ruptured pipeline or a malfunctioning valve, can result in
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oil spills or leaks. This poses a significant environmental threat, impacting ecosystems, water
sources, and wildlife.Corrosion compromises the integrity of pipelines, increasing the likelihood
of leaks and spills during oil transportation. This poses immediate environmental risks, affecting
soil, water, and wildlife in the surrounding areas.Oil spills and transportation interruptions due to
corrosion can have severe economic consequences. Cleanup costs, damage to infrastructure, and
the temporary or permanent cessation of oil transportation can result in significant financial
losses for both the oil industry and affected communities. Incorrect operation can result in
financial losses due to cleanup expenses, legal fees, and the costs associated with equipment
damage or replacement. Additionally, interruptions in oil supply can lead to revenue losses. The
researcher must find a solution to this Bottlenecks. Solution and strategies are needed to make
changes that can enhance efficiency, reduce costs, improve quality, or minimize waste.
Proposed solution and strategies for the challenges and bottlenecks analyzed from storage
To overcome and avoid accidents through transportation, the transportation mode through
pipeline is widely implemented globally for oil transportation. However, the wide
implementation pipeline has increased the chances of pipeline failures. Thus, to address this
issue the researchers proposed various solutions to the challenges and bottlenecks mentioned
above. Listed below are the following optimization ideas gathered from various studies:
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According to Oil and Gas (2015), Fiber Reinforced Plastic or (FRP) products that are
suitable for oil and gas including tanks, pipe, structural, and more. Features such as corrosion
resistance, flame retardance, nonconductive, high strength-to-weight ratio, and low maintenance
make our products ideal for all types of oil and gas facilities. Similarly, our corrosion resistant
pipes and tanks are ideal for handling and transporting chemicals such as hydrochloric acid.
FRP pipeline has the advantages of reliability, safety and economy. It is mainly used for
buried pipes and long-distance transmission pipelines. It has the characteristics of light weight,
high strength, corrosion resistance, long service life, low operation and maintenance cost, and
FRP has low thermal conductivity, reducing heat loss during transportation and helping
maintain the temperature of the transported substances, which is crucial in certain applications.
FRP exhibits excellent corrosion resistance, making them ideal for transporting and storing
corrosive substances like oil and gas. This results in longer service life and reduced maintenance
costs.
By incorporating FRP in pipes and storage tanks for oil and gas applications, industries
can benefit from enhanced performance, reduced maintenance costs, and increased operational
efficiency, while ensuring the integrity and safety of the transported and stored substances. FRP
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is often easier to handle, install, and maintain. They can be fabricated off-site, reducing on-site
Fusion bonded epoxy coating, also known as fusion-bond ероху powder coating and
commonly referred to as FBE coating, is an epoxy-based powder coating that is widely used to
protect steel pipe used in pipeline construction from corrosion. FBE coatings are thermoset
polymer coatings. The name fusion-bond epoxy is due to resin cross-linking and the application
method, which is different from a conventional paint. The resin and hardener components in the
dry powder FBE stock remain unreacted at normal storage conditions. At typical coating
application temperatures, usually in the range of 180 to 250 °C (356 to 482 °F), the contents of
The liquid FBE film wets and flows onto the steel surface on which it is applied, and
soon becomes a solid coating by chemical cross-linking, assisted by heat. This process is known
as "fusion bonding". The chemical cross-linking reaction taking place in this case is irreversible.
Once the curing takes place, the coating cannot be returned to its original form by any means.
Application of further heating will not "melt" the coating and thus it is known as a "thermoset"
Other Consideration for Optimized and Efficient Storage and Pipeline Maintenance
Despite precautionary measures in place, employee errors can still lead to tragic
accidents, no matter how small. Employees are subject to human error, so it is important to
Training employees and performing safety checks before any job is a vital aspect of
minimizing the risk of human errors. Employees will not intentionally cause accidents, but it is
your job to ensure they have the training and tools they need to prevent these incidents from
occurring. Staff in the oil and gas industry need to be trained on how to handle materials and
assets correctly. Workers must also be trained to recognize warning signs that could indicate an
imminent explosion and take prompt action to prevent it. (Uppler, 2021)
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safety procedures, and training, and perform regular maintenance on their vehicles. They should
also ensure that proper cargo handling, transport conditions, and securement protocols are
Regular maintenance can prevent equipment from malfunctioning, which can cause a
fire, spark, or ignite flammable materials During maintenance checks, engineers should identify
any worn-out parts and replace them promptly. Regular maintenance also ensures that equipment
like sprinkler systems is in good working condition, reducing the chances of incidents resulting
CHAPTER V
Summary of findings
This chapter provides the overall results of the study consisting the summary of findings,
1. The transportation and storage of oil and gas face significant challenges stemming from
corrosion, poor infrastructure, and human errors. Tackling these challenges requires a
infrastructure upgrades, and robust training programs. These measures are essential not
only for addressing immediate concerns but also for enhancing the overall safety and
2. Corrosion-related problems account for about 23% of hazardous liquid and gas
transmission pipeline failures. Serious repercussions from these mistakes may include
lost sales of the product, contamination of the environment, and even threats to public
3. Corrosion emerges as a significant contributor to oil and gas pipeline accidents, resulting
in leaks, ruptures, and structural collapses that can lead to severe incidents such as toxic
gas releases, fires, and explosions. Beyond endangering worker safety and causing health
notable 57% of reported accidents affect production, while 12% result in refinery
shutdowns lasting weeks or even months. Addressing corrosion in the industry is not just
4. The reported data underscores the significance of ndicating that over the past 20 years,
there have been an average of 52 major corrosion incidents on pipelines annually. This
5. Fiber Reinforced Plastic (FRP) products, as highlighted in (Oil and Gas 2015), offer a
diverse range of applications, including tanks, pipes, and structural components. These
FRP products are prized for their corrosion resistance, flame retardance, non conductive
nature, high strength-to-weight ratio, and low maintenance requirements, making them
well-suited for various facilities within the sector. For buried pipes and long-distance
economy, owing to their light weight, high strength, corrosion resistance, and
further contributes to reduced heat loss during transportation, crucial for maintaining
substance temperatures.
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6. Fusion Bonded Epoxy Coating acts as a thermoset polymer coating, FBE distinguishes
itself through its unique application method, differing from conventional paint processes.
The unreacted resin and hardener components within the dry powder FBE stock maintain
stability during storage conditions. Applied at temperatures between 180 to 250 °C (356
to 482 °F), the powder undergoes a transformative process, melting into a liquid form that
adheres to the steel surface. This liquid FBE film solidifies through chemical
7. Addressing human error in the oil and gas industry is crucial, as even minor mistakes can
lead to tragic accidents. Despite precautionary measures, it's essential to strictly enforce
safety precautions and conduct regular safety drills. Training employees and conducting
safety checks before each task are vital steps in minimizing the risk of human errors.
8. Transportation companies are advised to invest in safety procedures, training, and regular
maintenance to mitigate the risk of incidents during transportation. This includes ensuring
proper cargo handling, transport conditions, and securement protocols are followed, with
Conclusions
1. Enhancing the safety and reliability of transportation and storage systems, requires
upgrades, and instituting rigorous training programs. Taking these measures, the industry
can mitigate risks, improve overall operational resilience, and contribute to the
2. Corrosion related problems pose significant impact to the extent beyond mere operational
threats to public health and safety. This underscores the critical importance of addressing
3. Corrosion stands out as a pivotal and multifaceted challenge within the oil and gas
and structural collapses that result in severe incidents such as toxic gas releases, fires, and
explosions. The consequences extend beyond immediate threats to worker safety, giving
distribution pipelines, thereby safeguarding both operational reliability and broader safety
5. The incorporation of FRP in oil and gas infrastructure not only enhances performance
and reduces maintenance costs but also ensures operational efficiency, integrity, and
safety, with the added benefits of easier handling, installation, and maintenance.
6. Fusion bonded epoxy coating, or FBE coating, stands out as a recommended protective
measure for steel pipes in pipeline construction, aimed at preventing corrosion. due to its
7. Comprehensive analysis and approach encompassing employee training, safety drills, and
diligent equipment maintenance is essential to enhance safety and reduce the risk of
accidents in the oil and gas industry, primarily preventing corrosion, leakage, and
VI. References
Agency response PB2000-963401 oil program center understanding oil ... (2018).
https://www.epa.gov/sites/default/files/2018-01/documents/ospguide99.pdf
https://greenchoices.cornell.edu/resources/publications/transport/Crude_Oil_Transpo
rt.pdf
https://primis.phmsa.dot.gov/comm/FactSheets/FSCorrosion.htm?nocache=9090
The role of human error in accidents within oil and gas industry in Bahrain. (2017).
https://www.researchgate.net/publication/323377325_The_role_of_human_error_in_
accidents_within_oil_and_gas_industry_in_Bahrain