Opportunities Abound for Oil & Gas Midstream Inspection, Remediation
When discussing the state of the midstream business, the miles of pipe being constructed is an easy figure to point to and gauge whether things are looking up or bleak for the industry. More miles being built usually means that the industry is looking up. However, the U.S. also has an extensive existing network of pipes that crisscross the continent like a vast cardiovascular system, with gathering pipe capillaries and interstate trunk line arteries and veins. These pipes can be decades old, and like a car of similar age, older pipelines require maintenance in order to keep running.
As more pipelines get built, more maintenance and inspection work will become necessary. Combined with changing company cultures that focus more on safety and transparency, and this could mean business may be looking up for that corner of the midstream industry in whatever economic climate.
Over the past nine years, since 2008, Industrial Info has tracked more than $67.7 billion of pipeline projects that have been completed. Of that total, over $25 billion has been invested in crude oil pipelines, and $39.9 billion has been spent on natural gas and natural gas liquids pipelines. These totals include pump and compressor stations as well as raw pipe. This total represents thousands of miles of pipe that must be inspected periodically according to U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) guidelines. It's important to note that these guidelines are a minimum, and with public and media scrutiny of pipeline projects and incidents on the rise, a proactive approach to safety, perhaps including more frequent inspections and repairs, becomes more economical than ever before. For more on proactive safety culture in midstream companies, see March 29, 2017, article - Changing Company Cultures in Oil & Gas Midstream: Sustainability Through Safety.
This increased need for pipeline inspection and remediation spells opportunities for new inspection and repair technology to enter the market, especially in smart pig and leak detection technologies. On the materials side, more pipe being inspected means more needed repairs being found, and thus more steel pipe needing to be rolled. Here is an opportunity for U.S. steel producers and pipe manufacturers to leverage their geographic advantage over imports and gain some more market share.
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