Waging a war on corrosion

O&G. How are advanced polymers for pipeline coating systems helping in the battle against corrosion in pipe infrastructure?
MO. Primarily our polymer products are ‘Thickfilm coatings’, which are very different from traditional paints or coatings. Traditional paints and coatings are Thinfilm products that are applied in multiple layers to achieve reasonable thicknesses. Our polymer coatings are ‘Monolithic’ or non-layered at any desired thickness and are extremely durable, resistant to impact, erosion, sunlight, abrasion and chemicals providing superior resistance and longer protection to the end user.

If we use traditional pipeline coating products as an example, fusion-bonded epoxies are the most commonly specified system globally, primarily due to the high levels of impermeability provided. Fusion bonded epoxies however are easily damaged during transport and installation. The second most commonly specified systems are Three Layer Polypropylene (3LPP) or Three Layer Polyethylene (3LPE), which are actually fusion-bonded epoxies with rubber sleeves applied to provide more resistance to damage. Our polymer coatings provide the advantages of the 3LPP and 3LPE systems with a single product at more competitive pricing while providing performance properties equal to and in most cases far superior to traditional coatings.
 
Layering (traditional coatings must be applied in thin layers) is more susceptible to corrosion damage than monolithic coatings. Both fusion bonded epoxies and 3LPP and 3LPE use shrink sleeves to protect pipe girth weld joins, which are another high failure point in the system. Our polymer coatings are monolithic and do not utilize shrink sleeves providing a single seamless non-layered system with higher performance properties than traditional coatings and accomplish this at competitive or lower pricing making them appealing from a cost and performance standpoint.

We also provide internal coatings for corrosive and elevated temperature service in a variety of pipeline applications. Clients that have utilized our pipeline coating solutions include many Asian and Middle East national oil and gas companies and several multinational oil and gas companies.

O&G. What other oil and gas applications are you involved in besides pipeline protection?
MO. We are involved in a wide variety of oil and gas applications including offshore and onshore applications. The larges market segment when pipelines are not considered would be primary and secondary containment. We manufacture a variety of products that are designed for containment of petrochemicals and crude oil or gas in both primary and secondary containment applications.

By primary containment we mean internal coatings in storage, transport or refining in tanks or storage basins for crude oil, gas and all of their derivatives. Clients that have used our advanced polymers in primary containment include power generation entities, chemical and petrochemical manufacturing entities (including oil and gas national and multi-national entities) and manufacturers.

By secondary containment we mean the environmental burms or catchment areas common to all facilities and tanking areas required to maintain environmental integrity. The same users for primary containment will utilize our systems in secondary containment as they are typically ‘hand in glove’ systems. A specific example of this would be recent projects performed for Qatar petroleum at Ras Laffan where we completed secondary containment of the Dolphin refinery (12,000m2 with 85-different chemical and processes) and then followed up with a primary containment project (40,000m2 salt water cooling basins).

There are a lot of applications in oil and gas including chemical process basins, cooling towers, process facilities and the normal administrative and personnel facilities that go with them. We provide solutions for most requirements in all of these areas. The same solutions are required in other industries as well including power generation, desalination plants and manufacturing.

O&G. You have already mentioned one in your last answer, but could you maybe provide another example of a successful application of your solutions including any challenges and how they were overcome?
MO. The most common application or at least largest volume application would be pipeline coatings for external corrosion protection, or protecting the carrier pipe from oxidation. Our polymers have been used in this way by companies like Conoco Phillips, Petronas or China National Petroleum, and clients vary depending on the location of our plant and our operation.

Internal flow line coatings are a bit more complex in that typical applications usually involve elevated temperatures of 90-200˚C with hydrocarbons and corrosive and abrasive chemicals including high H2S content. The traditional solution for this application would be through installation of pipe with incanal or composite linings of nickel and chrome or stainless steel. These composite pipes are extremely expensive. We provide a solution where the client can use standard carbon steel pipe, which is a tenth of the cost of the alternative.

We have lots of references in the Middle East, Southeast Asia and Australia all of which are specific to oil and gas application and others in Canada and the United States which are specific to oil and gas distribution systems. Primarily our focus is on the distribution systems or the storage and process facilities that are either at the beginning or the end of that distribution system.

O&G. Despite the benefits of these advanced polymer solutions, wholesale implementation is not yet quite being specified by the major oil and gas companies. So what are the major obstacles to widespread adoption, and how are these being overcome?
MO. The major obstacle is that newer technologies in the oil and gas field are adopted slowly. The investment required in storage or distribution system is very large and the systems design life is typically 25-years minimum. If the system fails for any reason the products stops flowing and the daily cost of a system shut costs millions per day. As a result the corrosion engineers are working under tremendous pressure and are thus the most conservative specifiers on the face of the earth. They have a huge responsibility to protect or try to maintain and extend the longevity of an asset that can run into the hundreds of millions of dollars. These funds are usually invested upfront, with the return coming five-to-seven years down the road. Therefore, their job is to provide coating solutions, anti-corrosion solutions, or anti-abrasion solutions that last for the design life expected by the client and are very resistant to utilizing newer technologies until proven. It is difficult to prove new technologies without putting them in service and the situation results that newer technologies lie untried while older technologies remain in service and this being the case regardless of the poor track records of the older technologies. Another problem is that the end-users have been oversold by new technologies in the past and have then experienced problems and failures as a result.

Even the biggest companies in the world have problems with implementing new technologies. Client or the corrosion engineers who represent the client are hesitant to try new technologies, even though the technologies they are using have high frequency failures or high historical failure consistencies. Often a corrosion engineer wants a technology that has a proven track record of about 10-15 years. As a result, they are ignoring the new technologies. Our job is to get through these barriers to acceptance until acceptance is so wide that it becomes an international standard and we are fairly adept at doing this.

O&G. How do you see this market evolving over the next five years? Are there any particular developments you are currently excited about?
MO. There is a lot going on now since the high cost of oil and the high margins derived provide the companies who develop these projects with lots of cash, which they are investing into more projects. This has been the case in the past decade but particularly in the last few years. There is a lot of money being invested in upgrading facilities and the development of new facilities. There are many projects all over the Middle East, Russia, China, Asia and Africa so the opportunities are there. The biggest problem that the oil and gas companies have is getting qualified contractors and products delivered in a fast enough time to complete all the projects that are on tap right now. A lot of our customers can’t even get people to fill orders for them that aren’t large in size. We had a client come in from Dubai recently who couldn’t get anybody to quote a three-kilometre subsea pipeline because it was just not interesting enough for them with larger projects readily available – their order books are full. So they have problems with the overall quantity of projects going on right now and this is true for pipelines, refineries, and processing facilities. To meet the need, there is a higher demand than there are qualified contracting operation firms to carry it out. This creates a unique environment for trying new technologies.

Probably the most interesting development in advance coating technologies are the newer nano-technologies being developed especially in thick film polymer coatings liker ours. The potential is for coatings in the future to continuously maintain their properties without aging or being effected by chemicals and extreme conditions.

O&G. How does Nukote play into this space, and how are you going to help address some of these issues?
MO. We’ve seen the global demand coming for several years. In the last year-and-a-half, we have initiated six new manufacturing plants located in the key regions of SE Asia, India, China and the Middle East. We plan on initiating three more manufacturing locations next year in Africa, Russia and South America. Most of our competitor’s products ship out of the United States or Europe into these economies and constitute about 80-90 percent of their business. We’re going the other way – we have our initial facilities in the United States, but we now have many more manufacturing locations outside or the US and Europe. Therefore, we’re putting our people, support and manufacturing facilities on the ground in the regions where the markets are. As we see demand ramping up, we’re responding as quickly as we can, putting local people and local production right into the regions where the consumers are.

We also address the newer technologies with continuous development of new products designed to meet specific requirements. Increasing our ability to provide solutions for our clients.

Michael Osborne is the President and CEO of Nukote Coating Systems International, Managing Director of Nukote Coating Systems Middle East and Chairman of Nukote Asia Pacific, Nukote China, Nukote Arabia and Nukote India. Osborne holds Master Degrees in Civil Engineering and Business Administration and resides in Dubai, United Arab Emirates, with his wife and two daughters.