Canadian Underwriter

Pigs, Paint and Pipelines

May 9, 2014   by Brynna Leslie

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On January 25, a TransCanada natural gas pipeline exploded 50 kilometres south of Winnipeg on the main distribution line to Hydro Manitoba, triggering flames 200 metres high and cutting power to 4,000 people during the coldest January in two decades.

It’s the latest in a string of high-profile pipeline failures that have fuelled protest against major pipeline projects, like TransCanada’s Energy East and Keystone XL.

“The pipelines that are in the ground are getting older, and in some cases there’s more products flowing through them,” Nathan Lamberts, an associate with the Pembina Institute, told the CBC last October. “So you’re going to see increasing incidents and increasing defects in those pipelines unless they’re properly maintained.”

A National Energy Board (NEB) audit on TransCanada released in  February presented more bad news for the company. The NEB found TransCanada’s safety practices have been non-compliant in four key areas, including hazard identification, risk assessment and control, inspection and monitoring, and management review.

Further, a CBC report on NEB statistics seems to suggest pipeline safety incidents across all operators more than tripled, up from 45 incidents annually in 2000 to 142 in 2011. But do these numbers alone tell the whole story?

“I’m very cautious about statistics,” says Grant Smith, chief executive officer of Braemar Adjusting in Calgary. “The regulatory requirements are more and more stringent, requiring greater levels of reporting of incidents. More reporting of incidents, however, doesn’t necessarily correlate to a greater number of incidents.”

Despite public perception, most in the industry still believe pipelines are the safest method of transporting oil and gas. Could they be safer? The short answer is yes. The technology exists to construct new and replacement pipeline infrastructure with better corrosion-resistant materials and improved monitoring and maintenance technologies. But at what cost?

“This isn’t just a question of safety, it’s an economic decision,” says Bob Moore, managing director, North America at Charles Taylor Adjusting. “The larger pipeline companies transporting through major lines, they never want a spill. But it’s a matter of how much you want to spend, how much gets passed down to the consumer.”

What’s There Now?

There are approximately 825,000 kilometres of pipeline in Canada—enough to circle the earth 65 times, according to figures from the Canadian Energy Pipeline Association. Public discussion around pipelines tends to treat them as a homogenous group. They are anything but.

The 100,000 kms of large-diameter transmission pipelines that carry product across the country (and the continent) to refineries are given the highest profile in mainstream media. But there are also 250,000 km of gathering lines, concentrated in Western Canada, designed to transport crude oil emulsions and natural gas out of wells to processors. Half a million kilometres of narrower distribution pipelines bring refined products directly into our homes.

The potential for failure depends on a number of things, says Rob  Sparling, principal of the materials and failures group for forensic  engineering firm Giffin Koerth.

“When we’re talking about large national distribution systems, these pipelines tend to be constructed of steel and they tend to be buried,” says Sparling. “The biggest problem for these pipelines is corrosion, both inside and outside.”

How they fare on the outside, says Sparling, depends a lot on soil conditions. The exterior is more susceptible to corrosion in damp or muddy soil than in dry, sandy earth.

The composition of the emulsion within—typically crude saline, or natural gas liquids—changes depending on the maturity of the product coming out of a well, and has the biggest impact on the interior of the pipe.

“Higher levels of salt in the soil tend to lead to more corrosion,” says Sparling. “But the interior condition is also dependent on geological  conditions. With a drop in elevation, there’s nowhere for water to drain out and the water pools; that’s when you have a higher incidence of interior corrosion.”

Some operators have adopted new types of materials—fibreglass, for example. But they have their own unique problems, typically pressure system breakdowns and joint separations.

Maintaining Pipelines

“As long as everything is working the way it should, the incidents [of pipeline failure] should be quite limited,” says Moore, at Charles Taylor Adjusting. “Steel, if it’s properly maintained, should last forever. And it often does. There are a lot of pipelines in Alberta that are in terrific shape and have been in the ground for decades.”

For steel pipelines, operators rely on sophisticated methods to prevent corrosion. The first wall of defence is engineered coatings systems.

“The coatings on the outside of the pipe prevent water from getting to the steel,” Sparling explains. “But all coating systems have microscopic defects, pores that allow the water to get through. They have finite effectiveness and the coating will break down over time.”

Where possible, pipeline operators use cathodic protection. This involves applying an electrical voltage to the pipe, which changes the chemistry at the surface of the pipe so it doesn’t actively corrode. Cathodic protection also has its limitations.

“The point is to create an electrical circuit to protect the pipeline, where half the electrical circuit goes through the ground water and the other half runs through the pipe,” says Sparling. “Where there’s a section of piping that’s not in the ground water—where there’s a break in the ground water—there will be a break in the electrical circuit. The other possibility is failure of the system due to frost heave.”

There are a variety of ways pipelines can be monitored. Intelligent pigs—devices that can be pushed or pulled through a pipeline—use permanent magnets to locate any changes to the integrity of the pipe.

It’s called magnetic flux leakage,” explains Sparling. “When the pig gets to a spot where the pipe is thinner, there is a change in the magnetic field induced by the pig, an indication that there’s been corrosion or a loss of pipe wall thickness. Prior to putting a pig into an operational pipeline, we mimic that section of the pipe in a lab, put holes in it and pull the pig through to determine what signals we get from the sample, and what that tells us about known defects, sizes and geometries.”

Operators also use non-destructive cameras, essentially video inspections of a pipeline’s interior.

Hydrostatic testing is another common integrity test, used on both fiberglass and steel, where the pipeline is taken out of service and filled with pressurized water.

“[Operators] can pressurize the water at higher than normal levels,” says Sparling. “By measuring the pressure and forcing the pressure higher than normal, if we have a burst or a leak, we can test the pipeline integrity without risking environmental damage.”

But Sparling—whose firm investigates failures in pipelines—would be the first to say that none of the detection systems are error-free.

“All these methods have a probability of detection, but they’re not necessarily going to find every defect,” says Sparling.

Another inherent problem with current monitoring methods is they require disrupting the pipeline, itself, says Smith at Braemar Adjusting.

“The irony of increased investigation and reporting requirements is that the more you open things up to look at them, the more opportunity you have for human intervention, a higher likelihood of human error, and therefore more insurance claims,” says Smith. “An awful lot of these pipeline incidents happen when a backhoe is excavating and a pipe gets damaged. The more we’re digging up pipelines to investigate, the more the likelihood the pipeline doesn’t get buried properly.”

Can Pipelines Be Safer?

The technology to construct safer pipes can be prohibitively expensive. One of the easiest ways to protect against corrosion in steel pipes, for example, would be to use pricier stainless or build pipes with double walls—a pipe within the pipe—which would essentially offer back-up protection against leaks caused by corrosion. Both would more than double the cost of construction. Pipeline operators are always looking to improve maintenance and monitoring, an area where Canada has an edge.

At Alberta Innovates Technology Futures (AITF) in Edmonton, for  example, researchers are evaluating new technologies for leak detection, and advances in drone technology to monitor pipelines. Both would minimize human interaction with pipes. “Applying these technologies outside the lab is a hurdle,” says Richard Wayken, vice-president of bio and industrial technologies at AITF.

AITF is also at the forefront of the creation of the Canadian Pipeline Technology Collaborative, a collaboration of industry associations, provincial and federal governments, academics and private research institutions, due to start operations this year.

“We have to align our innovations assets across the country and leverage our resources to have a more focused and larger pool of resources dedicated to the commercialization of these technologies,” says Wayken.

At the end of the day, however, one of the best ways to improve pipeline safety is to invest in new infrastructure, argues Smith at Braemar Adjusting, but it requires a public will. “I get frustrated that we’re delaying the construction of new pipelines because of problems with pipeline leaks and pipeline incidents, which by nature should be the very reason we are building new and replacement infrastructure,” says Smith.

He points out that, with 95 billion barrels of oil consumed globally each day, the world has a growing and insatiable thirst for hydrocarbons.

“Everybody wants the oil and gas community to provide the hydrocarbons and the stuff we need, and people aren’t really reducing consumption of those products, no matter how green they are,” he says. “Yet our infrastructure is getting older and we’re using green argument to block the construction of new pipelines.”

Companies are going to keep moving their product through an aging infrastructure by whatever means possible to meet demand, Smith adds.

“Pipelines are big and expensive and take a long time to build and they only go in one direction. With rail there’s a lot more flexibility. You can change which market you go to depending on price.”

Smith says it’s not a matter of either pipeline or rail. “This industry is going to have to deal with both and we need to work on improving safety and improving insurance solutions for all methods of transport.”

This story was originally published by Canadian Insurance Top Broker.