Feb 25

Obama Vetoes Keystone XL, Project Once Again in Limbo

In what is probably a surprise to absolutely no one, President Obama has vetoed the Keystone XL pipeline extension project.  The project is in limbo once again but according to this recent article from Reuters:

The U.S. Senate Majority Leader Mitch McConnell, after receiving Obama’s veto message, immediately countered by announcing the Republican-led chamber would attempt to override it by March 3.

That is unlikely. Despite their majority, Republicans are four votes short of being able to overturn Obama’s veto.

Meanwhile the cleanup is still underway for the train car explosion in Mount Carbon, WV, as referenced in the previous blog post from Paula Hollywood.  Meanwhile, if you go to this web site from Pipelines101.com, they have some informative facts about the myriad network of pipelines:

America depends on a network of more than 185,000 miles of liquid petroleum pipelines, nearly 320,000 miles of gas transmission pipelines, and more than 2 million miles of gas distribution pipelines to safely and efficiently move energy and raw materials to fuel our nation’s economic engine. This system of pipelines serves as a national network to move the energy resources we need from production areas or ports of entry throughout North America to consumers, airports, military bases, population centers and industry every day.


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Feb 25

Will Latest Oil Train Accident Renew Commitment to Safety Improvements?

ARC Senior Analyst Paula Hollywood


ARC Analyst Paula Hollywood is our in house guru on reliability and she recently sent me this post about the train fire in Mount Carbon, WV.  It is interesting to note that President Obama also vetoed the Keystone XL pipeline yesterday yet another time.  It seems clear that the oil will flow with or without the pipeline, and we will probably see more incidents like this until we can be rational and build a more secure infrastructure to transport our oil.

“As of this writing, the fire resulting from the derailment of an oil train near Mount Carbon, WV on February 16, 2015 is  out and cleanup operations are in progress.  Early reports indicate the 109 car train carrying Bakken crude was traveling at 33 mph, well within the 50 mph speed limit.  According to Reuters the role of gas vapors will be explored by investigators.  http://www.reuters.com/article  Weather could have been a factor, but the still burning fire prevents investigators from gathering further evidence to determine the root cause.

ARC has been following the progress of oil train safety improvement initiatives.  This post http://www.arcweb.com/Blog/Post/272/Ruling-on-Rail-Car-Safety-Regulations-Delayed reported the deflated enthusiasm on the part of the rail industry and regulators to previously stated commitments.  This analyst predicted that it would take another incident to renew the impetus for change.  Now that it has occurred, will it change anything?

Fortunately, there have been no reported fatalities or even serious injury as a result of this accident, but surrounding towns were evacuated and supply of municipal water halted.  Environmentalists have been the first to renew public debate.  According to lohud.com, http://www.lohud.com/ CSX stated that all of the tank cars involved in the WV accident were the improved CPC 1232 model, a beefed up version of the DOT-111 model being phased out by regulators.

Was this incident severe enough to renew the enthusiasm of all stakeholders to tank car safety improvements?  Official comments have been limited with industry representatives preferring not to comment until the investigation is complete.  This analyst is now pondering whether current measures under consideration are robust enough to meet the goal. “

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Feb 10

Tweets from Monday Sessions of the ARC Forum


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Feb 09

ARC Forum 2015 has Begun

I am currently in the first cybersecurity workshop and the forum is off to a great start.  Later today we have workforce development workshops, several supplier press conferences, and our welcome reception.  It doesn’t seem like the snow has affected attendance so far since I am in a packed room for the cybersecurity workshop!  Forum I

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Feb 05

Reuters: No North Dakota Layoffs For Now, New Reserves Not Countering Falling Output

According to this recent Reuters article, many firms that are active in North Dakota, the number two oil producing state in the US, are avoiding layoffs — for now.  The article cites continued hopes that an oil price rebound may happen in the next six months.

From the article:

Oilfield service provider Halliburton has told its roughly 1,500 North Dakota employees that job cuts are not coming, for now. The update came in a letter to staff from Brent Eslinger, senior district manager for Halliburton in Williston, considered capital of North Dakota’s oil patch.

We at ARC are also of the opinion that the latest drop in oil prices will be a short term trend.  Oil producers are not replacing existing reserves at a fast enough rate.  Long term oil prices are destined to increase.  Check out this other article that was released by Reuters today: Oil majors fail to find reserves to counter falling output.  The basic gist of this article is that oil producers produced more than they found last year, and overall oil production in 2014 declined when compared to 2013.  It’s getting harder to find new sources of oil, and more expensive.  Meanwhile, demand for oil is still increasing, albeit at a weaker pace than it has in the past as this IEA Oil Market Report states.

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Feb 05

Get a Preview of our New Collaborative Process Automation System Study at the ARC Forum

ARC’s new Collaborative Process Automation System (CPAS) study is going to be ready soon, and you can get a preview of some of they elements of CPAS at the ARC Forum next week,.  Owner/operators in today’s process industries require automation systems that can help maximize their return on assets to achieve business advantage, while reducing the cost and effort to operate safely, securely, and reliably.  CPAS is ARC’s vision of such a system.

ARC introduced the CPAS concept over a decade ago in response to requests from several large, well-known owner/operators that were having difficulty evaluating the capabilities of the then-current Distributed Control Systems (DCS) to meet their evolving business requirements.  ARC concluded that the problems were not insurmountable, nor were they technology-constrained.  In fact, most of the functionality required had already been developed, with much of it commercially available — just not from a single automation supplier.


Version 3.0 of the CPAS study provides a detailed explanation of the guiding principles behind CPAS, the architecture, key enabling technologies and standards, and — most importantly — the business-enhancing applications that provide the core CPAS benefits.  ARC has also updated the report to reflect new requirements, as well as new enabling technologies and standards that have emerged since the last update to the report in 2010.  We also provide a vision of where we see CPAS headed.

At the Forum you can attend several sessions that will discuss CPAS, including “The Automation Challenge Continues” session on Tuesday afternoon at 2 PM.  This session will feature senior automation professionals who will present their respective visions as to what is needed in their automation to further improve their companies’ competitive position (and make their own lives a lot less stressful). The goal is to create a discussion that transcends this Forum and ultimately leads to even more useful functionality so, “it just happens”.

On Wednesday morning we have a session titled “Modern Process Automation Systems Offer More than Just Process Control” where users will discuss real-world experiences in utilizing the capabilities of CPAS for new sites as well as for upgrades to existing sites to help provide rapid return on their investments. The session will include an open panel discussion with audience participation. The representatives from operating companies in the audience will be able to ask questions and also share their own experiences for the benefit of attendees.

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Feb 04

Rigzone: Prices up as BP Announces Big Capital Spending Cuts

Oil prices rose yesterday on news that another oil major — BP this time — would be making some big capital spending cuts, according to this recent article in Rigzone.  BP announced it would curb capital expenditures by 13 percent to $20 billion.  Chevron announced a 13 percent cut last week.  The BP announcement coincided with the company’s end of year and Q4 results announcement, which you can read here.

From the press release:

In 2015, BP plans to reduce exploration expenditure and postpone marginal projects in the Upstream, and not advance selected projects in the Downstream and other areas. As a result, organic capital expenditure in 2015 is expected to total around $20 billion, significantly lower than previous guidance of $24-26 billion. Total organic capital expenditure in 2014 was $22.9 billion, lower than initial guidance of $24-25 billion.


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Feb 04

Emerson Releases Q1 Results

Emerson had their first quarter results call yesterday.  You can access the press release here and the PDF file of the earnings call presentation here.  For Emerson Process, sales were up 3 percent for the quarter YoY, while “underlying” sales growth for the quarter was up by more than 6 percent.  Downstream projects and MRO investment were cited as growth areas, which is consistent with what ARC is seeing with increased automation investment in the downstream and more focus being placed on maintenance projects.  The company expects moderate but continued growth through 2015, which is also consistent with ARC’s view.

Press Release: Emerson Reports First Quarter 2015 Results

Presentation: Emerson First Quarter 2015 Results

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Feb 03

Rockwell Automation Q1 Results

Rockwell Automation released its first quarter results on January 28th.  The automation companies seem to be weathering the storm of low oil prices fairly well and Rockwell Automation is no exception, with organic sales up 2 percent for the quarter YoY.  The company’s exposure to the upstream oil and gas industry is balanced by its heavy involvement in industries such as food and beverage, pharmaceuticals, and other industries.  You can read the presentation from the investor call here.  Overall sales for the company were down a little over 1 percent for the quarter.  The company is expecting a stronger headwind from the strong US dollar and higher oil prices throughout the rest of the year.

Rockwell Automation Reports First Quarter 2015 Results



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Feb 03

Emerson Process Experts: Remote Vibration Monitoring Case Study

A very nice case study on remote vibration monitoring over at the Emerson Process Experts blog by Deane Horn, marketing manager for online monitors at Emerson.  It’s an example of how a North American power producer was able to use remote vibration monitoring of rotating assets (turbines in this case).  Does this count as an “Industrial Internet of Things” application?  I personally think so.  Sensors are serving up data to applications that are accessed by maintenance experts  who then make decisions or initiate action from a remote location.  The Industrial Internet of Things is already around us and expanding every day.

Emerson Process Experts: Remote Vibration Monitoring Case Study

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