Energy projects face shrinking budgets and tighter timelines. Operators, together with their engineering teams, are challenged to find creative cost-reduction solutions without compromising safety or performance.
Reusing, relocating, and repurposing oil and gas equipment, is a popular strategy for its cost-effectiveness. Whether placing existing separators into new services or relocating gas compressors and refrigeration units to new fields, this approach can help you meet deadlines and budget constraints.
There are many reasons to explore this strategy; however, ‘proceed with caution’ is our overarching advice. There may be instances in which new equipment is still the more reliable and effective solution.
Benefits of Repurposing Oil and Gas Equipment?
- Cost Savings:
Leveraging existing assets can reduce capital expenditure. This cost savings though if often reduced after include inspection and modification scope for repurposing the equipment.
- Time Efficiency:
Reused equipment, when available and functional, can often be deployed more quickly than waiting for new orders.
- Sustainability:
Repurposing equipment aligns with corporate sustainability goals by reducing waste and extending the lifecycle of assets.
Key Considerations for Reusing Equipment
Governing Codes and Standards
When repurposing oil and gas equipment, it’s crucial to follow applicable industry standards to ensure safety and performance. These are some of the most relevant codes:
- API 510: Pressure Vessel Inspection Code
- API RP 572: Inspection Practices for Pressure Vessels
- API 570: Piping Inspection Code
- API RP 576: Inspection of Pressure-Relieving Devices
- API STD 653: Tank Inspection, Repair, Alteration, and Reconstruction
- API STD 579: Fitness-for-Service
Compliance with these standards ensures that reused equipment can be safely integrated into new operations.
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ASME
In addition to API codes, several other standards must be adhered to, depending on the jurisdiction and specific industry requirements. Organizations must follow all application health and safety regulations.
CODES/STANDARDS FOR REUSING EQUIPMENT IN CANADA
CSA Standards (Canadian Standards Association):
- CSA B51: Boiler, Pressure Vessel, and Pressure Piping Code: Governs the construction, installation, inspection, and certification of pressure vessels and piping systems across Canada.
- CSA Z662: Oil and Gas Pipeline Systems: Governs the design, construction, operation, and maintenance of pipeline systems in Canada. It’s essential for any relocation or repurposing of gas pipelines and similar systems.
- CSA W59: Welded Steel Construction: This is relevant for any welding work needed in repurposing or relocating equipment.
Provincial and Territorial Regulations:
- Each Canadian province and territory havs its own regulatory body that oversees pressure vessels and related equipment. For example, ABSA (Alberta Boiler Safety Association) in Alberta regulates pressure equipment safety in the province.
- Technical Safety BC governs equipment standards and inspections in British Columbia.
CODES/STANDARDS FOR REUSING EQUIPMENT IN THE USA
ASME (American Society of Mechanical Engineers) Codes
- ASME Section VIII: Rules for Construction of Pressure Vessels: This code is widely used across the United States and is also accepted in Canada.
- ASME B31.3: Process Piping: This applies to piping used in chemical, petroleum, and related industries.
National Board Inspection Code (NBIC)
- A key standard in the United States for the inspection, repair, and alteration of pressure vessels and boilers.
CROSS-BORDER COMPATIBILITY
If equipment is being relocated across borders (e.g., from the U.S. to Canada or vice versa or state-to-state), it’s important to ensure that the equipment complies with the local regulatory standards in the new jurisdiction.
Inspection Requirements
Before deploying any equipment into new service, a thorough inspection is necessary. A detailed inspection plan should be developed based on the equipment’s condition, service history, and the specific requirements of the new application.
Key Inspection Elements:
- Service History: Understanding the previous operational conditions is critical. Identify signs of corrosion, cracking, blistering, and other types of degradation. Key factors include material thickness, the presence of under-insulation corrosion, and dimensional changes.
- Non-Destructive Examination (NDE): Depending on the equipment’s condition, this may include ultrasonic thickness measurements, radiographic inspections, and magnetic particle testing.
- Confined Space Entry Requirements: Ensure proper safety protocols are in place, as many inspections may require confined space entry.
- Documentation Review: It’s critical to review previous drawings, inspection records, and any reports related to modifications, damage, or repairs.
Challenges in Documentation and Material Verification
Lack of proper documentation (e.g., missing original equipment drawings or insufficient inspection records) is a significant red flag.
For pressure vessels, the ASME Code Section VIII, Division I, UG-10(c) provides guidance for handling unknown materials, but it may lead to conservative assumptions, such as reducing the maximum allowable stress and working pressure.
For cryogenic skids, ASME B31.3 (Process Piping) and Section VIII, Division I provide guidance on material selection and stress analysis. When dealing with unknown materials in cryogenic service, you must perform material verification, including testing for low-temperature toughness. If material properties cannot be confirmed, conservative assumptions such as derating the design temperature and applying a lower allowable stress may be necessary, potentially impacting the overall performance and safety of the skid in cryogenic applications.
Case Example: When Re-purposing Costs More
While repurposing equipment can lead to savings, without the proper pre-evaluation, there is great risk that it could have the opposite effect.
Consider a 5,000 bpd stabilizer skid package with an on-skid direct-fired reboiler.
Overseen safety concerns necessitate replacing the burner fire tube with a custom electric heater. This modification incurred costs that exceeded the procurement of a traditional reboiler unit. Additionally, shop installation delays pushed the project past the lead time for new equipment.
Is Reused Equipment Always Faster and Cheaper?
The benefits of reusing equipment must be weighed against potential downsides, such as:
- Modifications that are more expensive than anticipated.
- Delays caused by unforeseen repair or upgrade needs.
- Documentation issues that result in excessive safety factors and reduced efficiency.
In some cases, especially with high-pressure equipment, the savings from repurposing can be significant. However, lower-pressure systems may not justify the additional effort, and purchasing new equipment might be the more cost-effective solution in the long run.
How to Be Sure: Inspections for Assessing the Viability of Used Equipment
While reusing equipment has clear advantages, in some cases, new equipment may still be the more reliable and effective solution.
Your engineering team must be able to clearly identify the risks and rewards of deploying used equipment. A thorough inspection and documentation verification will empower you to make informed decisions about equipment use, while balancing cost, time, and safety.
Consider:
- Involvement of Engineering Early On:
Involving engineers in the evaluation process can identify potential risks and help determine whether the repurposed equipment will meet operational requirements.
- Transparent and Clear Documentation/Inspection Findings:
Without these, the project could face significant delays and/or incur higher costs.
- Creative Solutions:
Sometimes, existing equipment needs only minor adjustments to function in a new service. These modifications must be balanced against the cost and time of new equipment procurement.
If you have access to used equipment and are curious of the potential savings – connect with us.
It is vital to properly assess the risks and rewards!