Meeting Archives

2001 Summer: Houston, TX, May 31

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Summary
Crude Oil Quality Association
Houston, TX
May 31, 2001

The meeting agenda was distributed to those in attendance.  There were 41 attendees of which 12 paid the attendance fee.

Legal Review of Anti-Trust - Tish Marshall, COQA Facilitator reminded all attendees to review the Standard Setting Rules prior to each meeting, please refer to "Information".

NYMEX Specifications at Midland - Ms. Deniese Palmer-Huggins, Director of the NYMEX Houston office, spoke to the COQA on NYMEX operations.   Deniese informed members of the free classes the Houston office holds on trading in the futures market.  NYMEX Houston also teams with Rice University to offer paid classes on risk management.  NYMEX entered the energy market with heating oil futures in 1978.  Crude oil was added in 1983.  The total volume of NYMEX traded contracts has increased pretty steadily over the years with their crude oil contracts following that same trend.

NYMEX offers a wide variety of products to trade with more scheduled to be introduced in September with the inception of eNYMEX.  The current grades of crude oil offered are Light Sweet at Cushing with specified grades of both foreign and domestic crudes accepted.  With eNYMEX, LLS, WTS and WTI at Midland and Mars at LOOP will be added.  The eNYMEX is currently in the draft stage.  If you have comments, please address them with your company representative on the Exchange or Mr. Dan Brusstar at the NYMEX office in New York (212-299-2604).  NYMEX responds to the industry rather than leading it and will be very happy to receive your input.

 

Desalter Operations - Mr. Bob Adamski of Equilon Technology gave an overview on how desalting works and how to optimize the process.  Desalting is “the dilution and removal of salts and water extractable contaminants from crude oil”.  Desalter performance is based on Desalter hardware, operating parameters, crude oil properties and emulsion breaker type and dosage.  Desalters will generally be rated satisfactory if at least three of these criteria are working.  If two or more are performing poorly, the desalting operation will not be acceptable.  Most problems in Desalters are traced to the “rag layer”, that mixture of oil, water, salt and solids in emulsion between the oil and water layers.  Equilon Technology offers a range of testing equipment, from bench size to pilot plant, to assist refineries in determining optimal use of their Desalter.  Equilon Technology has also done numerous tests on the effect of methanol on Desalter performance.  They have concluded that at low concentrations, there is little impact on the Desalter.  In higher amounts, the oil could carry under into the effluent water with possible environmental ramifications. 

Salt and Methanol Measurement in Crude - Mr. David Geis of Precision Scientific Petroleum Instruments introduced the group to his company’s on-line Salt-in Crude Monitor.  Salt in crude is an important quality consideration.  High salt contents can lead to corrosion in the pipeline and refinery operations.  Knowing the salt content in any operation is necessary to ensure that corrosion control measures are taken as needed.  Measuring the salt content before and after the refinery Desalter can check the efficiency of the unit.  The Salt-in-Crude Monitor determines salt content by measuring the AC conductivity of a solution of crude oil in a specialized solvent system, simulating laboratory procedures.  The monitor also works with other petroleum products.  The test performed is accurate to within 0.5 pounds per thousand barrels (or +/- 5%, whichever is greater) and can be repeated approximately every 7 minutes. 

Mr. Ranzy Morgan of Petroleum Analyzer Company (PAC) brought the members up to date on the ongoing project of measuring methanol in crude.   Equilon Pipeline, Envantage Inc., PAC, and ITS Caleb Brett formed an alliance to address the issue of the use of methanol in crude production.  Although methanol works well as a hydrate inhibitor, it creates problems downstream and an early detection system would benefit the receiving pipelines and refineries.  A prototype was tested this spring and measured against in-house laboratory methodologies.  The first version of an in-line analyzer was installed in May and results appear consistent with the prior testing.  This project is nearing the final stages of testing and PAC will keep the COQA updated of its implementation progress.  Production units for measuring methanol in crude should be available in mid- August of this year.

 

Implementation of Best Practices for Water-in-Crude Measurement - Mr. Charles Der of KBC Advanced Technologies discussed water-in-crude measurement as a business process.   Sampling, sample handling, preparing the sample for testing, the actual testing and the accounting of net barrels are all important parts of the process.  The water-in-crude method of test is an important part of the process, but still just one step.  Charlie stated that Karl Fisher is superior to the centrifuge in that it has higher accuracy and precision but, with poor implementation, those advantages may not be fully realized.  The procedures used for sample homogenization and sub sampling prior to test are absolutely critical for Karl Fischer because the size of the sample analyzed (1 ml) may be 50 times smaller than for centrifuge.  Best practice standards covering all aspects of the water-in-crude process do exist and KBC’s recommendation for those standards can be found in the attachment.  It is also important to consider the various parties involved in the business process of measuring water-in-crude (i.e. loading terminal, pipeline, truck unloading, refinery, etc.) and take steps to ensure that best practices are negotiated for all elements of each transaction.

Hydrogen Sulfide in Petroleum - Mr. Mike Nicholson and Mr. Tim O'Brien of Baker Petrolite summarized for the group the importance of measuring and managing H2S.  Hydrogen Sulfide is a toxic, colorless gas known for its rotten egg odor.  In addition to being toxic (it is lethal at concentrations of 713 ppm), H2S is highly corrosive.  The odor is noticeable at 11ppb concentrations and brings its own set of management problems.  The limits for H2S vary considerably among regulatory bodies and local facilities so it is important for both the loading and receiving parties to monitor and control H2S.  There are good test methodologies available for measuring H2S but, as with most everything, sample collection is critical.  H2S can be manufactured when the crude is heated and cooling or storage of the samples will not reflect the true H2S potential in the crude when tested. 

Treatment of H2S takes several forms, oxidation to form elemental sulfur, neutralization with organic and inorganic compounds, and treatment with reactive / conversion additives to form inert sulfur species.  Each method has its own advantages and disadvantages and should be chosen based on downstream requirements, injection temperatures, transportation conditions (e.g. more heating) and the ability to mix the additives properly.

 

ASTM Crude Oil Cross Check - Mr. Clifford Mills of Conoco went over the latest results on the ASTM Cross Check program.  There has been good participation (86 labs) but, in general, the results returned indicate much wider than anticipated ranges.  Clifford and Gerald Lekberg of Williams Energy have discussed comparing only those labs that participated in the COQA Round Robin to see if those results are less widespread.  Selected test results from the ASTM Cross Check are available; please contact the COQA facilitator if you’d like a set.

Report on Additives Meeting - The survey on additive components was distributed in March and 12 replies were received.  A summary of the replies will be available to all COQA members after the respondents have reviewed it.  Harry Giles, COQA facilitator, shared a few observations on the survey.  She reported that, in the morning meeting, Dr. Lynn Frostman of Baker Petrolite shared information about her company’s new hydrate inhibitor which is intended to be utilized as a methanol substitute.  Baker Petrolite’s openness and willingness to accept input is a very good start toward strengthening communications between all parties who deal with additives; the producers, the manufacturers, the pipelines, the refiners, etc.  

 

Update on Water Measurement Implementation Task Force - The key issues facing the Water Measurement Implementation Task Force are formulating a plan of attack to overcome resistance in moving from BS&W testing to “Best Practice” (at this point – Karl Fischer) water testing, and how to incorporate that best method into custody transfer and contract and tariff language.  A re-education of the personnel involved; from field technicians to buyers and sellers of crude oil, is necessary to accomplish our goal of guiding the industry toward using the best technology available to measure water in crude. .  Mr. Clifford Mills of Conoco is heading this task force.

Capline Common Stream Parameters Update - Ms. Patti Edens of Equilon Pipeline reported that the LLS specification program is going extremely well with one excursion reported so far in 2001.  

Equilon Pipeline, as the operators of Capline, has started a program to switch Capline water measurement to Karl Fischer.  The producers are not convinced that this is the way to go.  However, LOCAP already utilizes Karl Fischer so Capline will start with foreign crude.  The instruments are in place and training is underway.  Patti mentioned that Equilon Pipeline is doing a search of their tariffs to be sure the language is compatible with switching to Karl Fischer.  So far, especially with the newer tariffs, they have encountered few problem areas. 

Mid-Continent Testing/Analyses Update - Ms Patti Edens of Equilon Pipeline updated the group on Basin Pipeline.  A memo was sent out on May 21 to all connecting carriers indicating that the new sulfur specification on Basin will be 0.4%.  This change is necessary in order for Basin to meet the 0.42% NYMEX requirement at Cushing.  So far, there has been little feedback (the deadline for comments is June 30) and Equilon Pipeline does not expect difficulties with the new specification which is planned to take effect on August 1.  Equilon Pipeline has recently completed pigging the first half of the line with the remainder scheduled to be pigged next year.  Patti also mentioned the TOSCO fire which shut down Basin for about 180 hours.  The pipeline is currently well underway with catch-up and no additional problems are foreseen.  

Mr. Aaron Dillard of Conoco summarized the status of the Mid-continent subcommittee.  A letter will be sent to all Basin Pipeline connecting carriers addressing the COQA crude quality concerns such as stream parameters, especially distillation points and metals.  Aaron also mentioned the NYMEX crude specifications at Midland that will be rolled out with the eNYMEX trading later this year.  He shared the concerns we had on the quality parameter only being referenced by “ASTM standard” versus identifying the specific ASTM method number.

Update on CCQTA Projects – Not available.

COQA Web Site and Budget Report - The COQA web page is up and running.  Comments on the financials or the web page are welcome, please contact the COQA facilitator.

Tish Marshall, COQA Facilitator