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Volume 19, Number 6November/December 1968

In This Issue

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The Long Look Forward

Written by Brainerd S. Bates
Photographed by Burnett H. Moody
Additional photographs by S. M. Amin and Ali A. Khalifa

During the first half of 1968 the Arabian American Oil Company (Aramco) produced an average of about 2,800,000 barrels of oil a day. By measures of past performance and future projections, Aramco anticipates that its crude oil production could double by 1975. If so, half of its future output will be flowing through and processed in facilities that do not exist today. It may be less obvious that planning for the myriad installations needed to handled the majority of Aramco's total production and processing in the distant future must be started years before these facilities ever see a drop of petroleum.

The southernmost oil installations being presently operated by Aramco in eastern Saudi Arabia are an aluminum-painted gas-oil separator plant and an expansion turbine pump station at Haradh, deep in the desert on the edge of the great Empty Quarter. Lonely well platforms standing out of the water at Safaniya, world's largest offshore oil field, are the most visible signs of Aramco oil activity near the northern perimeter of its concession area. The distance between these two points is something like 400 miles. In this day of turbojet helicopter transportation, which the . company takes advantage of, it is possible to cover the entire distance in a morning. Viewed from the Plexiglas bubble in the nose of the chopper, evidence of an integrated oil-producing, refining and shipping operation stands out sharply against the stark desert terrain. Like a simple country road that leads gradually into a network of freeways, cloverleaf interchanges and increasingly dense urban settlements, a single slender pipe, flanked by occasional pumphouses and spheroids, thickens and multiplies into a series of pipelines converging toward ever more elaborate complexes of towers, columns and vessels where crude oil is turned by various steps into salable commodities.

The look of horizontal and vertical steel, perfectly maintained and coldly impersonal, dominates the view from the slowly-cruising aircraft. Modern oil facilities, once installed, do not need many people to keep them running. But as he flies over Aramco's widespread oil installations the helicopter passenger who looks hard enough sees every so often unmistakable evidence of sweaty human effort.

Heavy trucks carrying heavy loads wear smooth a ribbon of sand alongside and endless stretch of pipeline. A huge square hole in the ground at the industrial area in Abqaiq, Aramco's producing center, awaits one more addition to the stack-flanked power plant there, and in the crowded tank farm area at Ras Tanura bulldozers prepare a large round hole for foundations of yet another giant crude storage tank. Spasmodic flashes of blue flame, intense even in brilliant sunlight, point to welders joining lengths of pipe or fabricating heating tubes or the metallic skeleton of a brand-new control house. Half-completed columns and scaffold-encased towers rise out of the steel jungle that is the Ras Tanura refinery, their newness accented by the yellow-orange primer coat which covers every surface. Out off the loading piers of the Ras Tanura marine terminal a barge which looks and is all business dredges the bottom of the Gulf to deepen a ship's channel for ever-larger tankers.

Another kind of human activity which goes on continuously at Aramco is not visible to any observer traveling low across the sky, nor are its results so immediately apparent to the inquiring eye. In various offices throughout the company men in shirtsleeves sit around tables either in deep discussion among themselves or listening to a colleague presenting oral arguments with the aid of flip-charts, graphs and statistics spelled out on blackboards. These are meetings held among all levels of company engineers, financial men and members of management out of which will come decisions to transport, weld, hoist, paint, and dredge on a massive scale years hence. While large segments of employes are kept busy meeting past commitments for current Aramco production, many others are hard at work preparing the company to fulfill demands for its output way down the road.

Experience shows that on a normal, non-crash basis it requires at least a year from the day a new pipeline project is formally approved, and funds for its implementation provided, to the time the line goes on stream and begins to contribute to Aramco's total production effort. In the case of a gas-oil separator plant (GOSP), to take another example, the average lead time is 18 months. It is only too evident that the kind of in-depth planning which goes into the creation or expansion of a major oil installation must get underway long before that project comes up to the high-level group authorized to give it the final nod.

If petroleum production, refining and shipping is a business—and a highly competitive one at that—it is just as evident that facilities needed to produce, gather, process and transport oil represent enormous capital investments. No petroleum company can afford to own facilities much more extensive than those required to meet current demands for its output, but at the same time international oil firms must always be prepared to satisfy their customers' expanded requirements in terms of volume and variety if they expect to remain in business. Aramco's efforts to anticipate what it has good reason to believe will be rising demands for its output are carried on, as nearly all such future planning is, through the mediums of much paper and many conferences among men who are qualified to deal with the complex issues involved.

The paper on which the company does its thinking about expanding oil operations facilities—when, what kind, and by how much—has printed on it graphs showing future production curves drawn according to customers' total anticipated requirements; engineering specifications of particular projects under consideration; budgeted costs and completion dates broken down into specified time increments; approval signatures in ascending order of executive responsibility of company people who have reviewed the projects in the light of their engineering and financial expertise.

The normal sequence of the paper routine leading up to the increased production of an Aramco oil field, the construction of a new GOSP, or an addition to the Ras Tanura marine terminal's berthing capacity may, of course, overlap or be switched around, depending on the nature, size, complexity and urgency of the project in question. But no matter what procedure is followed, every major undertaking planned to answer anticipated demands for oil receives a thorough examination from all sides. Before the first topographic survey is made on the site of one more GOSP, or a desolate stretch of sand staked out to locate a new pipeline, many a meeting has been held in one of Aramco's outlying operating areas, at Dhahran headquarters, and with representatives of Aramco's owner companies to examine each project for its technical and economic feasibility and to see that all the planned undertakings together will assure the company of its share in the steadily growing oil market.

The recommendations which come out of these gatherings are not arrived at lightly. Over a period of only a week or so their participants may be talking about expenditures adding up to many millions of dollars. As the discussions move up into the higher echelons their outcome, it should go without saying, affects nothing less than the future health of the company. By the time issues relating to the expansion of Aramco's oil operations have reached the summit, however, the crucial issues of what, how and where would have been resolved by engineers down the line whose job it is to discover and propose the most appropriate technical responses to shifts in the general oil market picture. It is the number of choices facing these engineering specialists, who like everyone else involved must bear in mind the all-important financial implications of the schemes they put forward, that makes their assignments so constantly challenging.

As an example, take pipelines. Decisions relating to these most essential adjuncts to any oil operation ought to be fairly clear cut; they are, after all, simple in form and concept and have no moving parts. But even pipelines offer construction planners a formidable array of options, each linked in one way or another to relevant economic considerations. In every instance engineers must first of all decide whether to install a powerful driver behind a relatively small-diameter pipeline or to go the other way around. Pipeliners have to choose from among a range of diameters, wall thicknesses and grades of steel to go into the pipe itself. They must look carefully for the best route along which to lay their pipe and decide, after having considered all the factors, which sections of it should be buried and which supported above the surface by trusses.

When equipping new pump stations with prime movers, engineers have to select both the type of driver to be installed and the amount of horsepower the driver must come with to carry the load. There are in all five basic types of drivers—diesel, electric motor, combustion gas turbine, expansion gas turbine, and steam turbine—being used by Aramco to move oil from areas near its source to central locations for processing. Much weighing of options, often finally ending in compromises, has gone into decisions as to which driver would be most suitable for each position in the company's pump station system.

A look at expansion possibilities for storage tanks uncovers an entirely different range of choices as to which way to go. First question is, just how much capacity to add. Inadequate tankage can mean not only excessive tanker waiting time at a marine terminal and the possibility of lost crude and product sales but also costly shutdowns and startups of producing and processing facilities down the line. Overcapacity, on the other hand, obviously wastes investment capital.

The next logical variable would be tank size. Aramco has worked out elaborate formulas, with cost factors built in, to help planners determine the optimum size of storage tanks under a given set of conditions. While planning engineers are thinking about how large their next storage vessels should be they are also considering types, choosing for their particular requirements, depending on the relative volatility of the petroleum to be stored, either cone roof or floating roof, or ordering special-design spheroid tanks for storing products under pressure. One final related factor which cannot be ignored is the weight-bearing strength of the land on which the tank is to be built. As the size of such tanks continues to grow (Aramco recently completed one which can hold 650,000 barrels of crude), the shells plus their contents become extremely heavy. The foundations for these modern monsters must rest on ground which has to be carefully selected and tested for its stability.

Those involved in the continuing study on the future of Aramco's marine terminal facilities work with factors even more complex and are faced with options many times more numerous than any mentioned so far. Planning engineers know from recorded port statistics that the number of tankers calling at Ras Tanura has been increasing for some time, and the size of the ships themselves keeps on growing. Already added to the port's two piers, which together can accommodate 10 tankers at a time, is a new sea island about two miles offshore designed to handle mammoth tankers too large for the piers.

The berthing spaces at the Ras Tanura marine terminal can be considered customer contact points in the same way that supermarket checkout counters and theater box offices are. Customers who must wait in line too long, too often to buy, whether they're in the market for food, or entertainment, or oil, will soon be taking their business elsewhere. But marine terminal operators cannot afford to build so many units of the real thing to find out how many loading berths, and storage facilities to feed them, will strike the correct balance between optimum customer service and economic good sense in the years to come. Aramco has gone to the computer for the answer.

In setting up a computer "model" for Aramco's marine terminal as the initial step in this quest, engineers and systems analysts worked with recent historical data on all aspects of Ras Tanura port operations. The number and size of tankers calling at the port, the quantities, kinds and grades of oil cargoes these ships lifted, waiting times for berths and tug service, time periods required for mooring and deballasting, even the number of days the port was shut down because of bad weather were all taken into account.

These statistics were arranged in a logical sequence as they affect port operations in actual practice and then translated into a language which the computer could understand. After the computer's "output" was checked against actual port operations to ascertain its validity, those associated with the study were ready to put the General Purpose Simulator to work on problems of future port planning.

For some time the planners have been at a stage where they can change around "input" cards with programmed data punched into them to represent hypothetical shifts in random tanker arrivals, sizes of tankers calling, types of cargoes desired, loading rates, number of tugs available, etc. to see how these alterations would affect Ras Tanura port operations in the future. As consideration is given to modifications and enlargements of Aramco's shipping facilities the computerized "model" of the terminal can be refined to take these proposals into account. Very quickly the computer is able to inform management of the extent to which these proposals would affect costs and operating efficiency at the customer contact point to which Aramco delivers so much of its oil.

Decisions revolving around the expansion of basic oil production call for planning and financial analysis of the widest magnitude. It stands to reason that any substantial addition to the volume of oil a company decides to produce to meet future demands has a corresponding effect on every facility, from the producing fields all the way to the oil export piers, which will be handling that increase.

The question of whether additional increments of oil come from a new, undeveloped field or one presently on stream involves, like every other evaluation this article discusses, consid- eration of economics. Proximity of the production source to the customer contact point obviously saves money in constructing the necessary links between them. Providing that both types of sources are roughly equidistant from the ultimate shipping point, it may be best to obtain increased volume of oil from fields currently in business by simply enlarging the facilities which already pump, transport and treat their production. The choice of which existing fields will provide the new increments of production depends upon which grade of crude—in Aramco's case, Arabian Light, Arabian Medium, or Arabian Heavy—is expected to be in greatest demand, and which fields holding the desired grade and qualities of crude oil have sufficient reservoir potential to yield added increments of production with fewest expensive pressure maintenance provisions.

No matter which oil field is selected to supply the next increment of production, however, every single type of installation in a sequence running from wellhead to pierhead comes under consideration. In Aramco's fields oil from widely-spaced wells runs through flowlines and trunklines, known collectively as gathering systems, to more or less centrally located GOSPs, where most of the gas produced in association with the crude is separated in various stages in spheroids. The resulting oil, now at almost atmospheric pressure, must be pumped through pipelines to the next processing point.

What happens here depends upon whether the crude is "sweet" or "sour" and whether it is destined for direct offshore sale or for the Ras Tanura refinery to be manufactured into products—gasoline, kerosene, asphalt and the like—for export and domestic consumption, "Sweet" crude oil can be pumped without further treatment directly to tank storage for ultimate delivery to the customer. "Sour" crude oil contains dissolved hydrogen sulfide, a toxic compound which must be removed by a process known as stabilization before it goes aboard tankers.

Oil wells . . . gathering systems . . . GOSPs ... pump stations ... pipelines ... stabilizers . . . refinery process plants . . . quantities ... capacities ... diameters ... power sources . . . calendars . . . costs. When Aramco's engineers and financial men sit around paper-cluttered tables considering new oil production targets they must fit all these individual elements together so that their company can come through on the date and at the cost stipulated with increased amounts of petroleum promised their customers long before. It is no game for children.

In this age of constantly growing demands for energy, while keeping abreast of growing requirements for its basic raw material, crude oil, Aramco cannot afford to ignore market trends which compel technological improvements in other areas of its business. Sometimes, as in the vital matter of petroleum deliveries, the challenge tends to be merely mechanical. A typical example:

Tankers calling at Ras Tanura frequently have orders for blends of different grades of crude or of crudes and refined products. Formerly, these varying types of petroleum were loaded singly into ship's tanks, where the blending was not always uniform. In 1961, Aramco installed on the shore mar its Ras Tanura loading piers a so-called inline blender able to supply to customers completely blended petroleum combinations in the proportions called for. The facility, originally designed to blend 20,000 barrels of mixes an hour, was later modified to handle 30,000 barrels an hour. In the mid-1960's calls for blends had risen so sharply that a second inline blender was placed on stream, this one capable of handling up to 60,000 barrels per hour. Now, with constantly growing cargo sizes of tankers, Aramco is again investigating means of increasing its shore-based inline blender capacity to speed loading rates and cut expensive in-port time of these new giants. The company presently favors raising the hourly throughput capability of its larger blender by 30,000 barrels, which would require adding piping, meters, motor-operated valves and booster pumps to this facility.

The other end of the scale in complexity is epitomized by the company's continuing effort to meet growing requirements abroad for liquefied petroleum gas. A clean, practical and cheap fuel for industry and home cooking and heating, LPG manufactured by Aramco is refrigerated in a plant near its Ras Tanura marine terminal for storage and compact transportation in specially insulated tanks aboard ships and then vaporized into a gaseous state near its point of sale.

In the beginning, the program called for facilities to refrigerate, store and deliver for export 4,000 barrels of LPG a day. The first bulk shipment in December, 1961 of the propane and butane product came from gases separated at Ras Tanura from crude oil or produced in manufacturing processes at the company's refinery there. As requirements soared, with no letup in sight, and as Aramco laid plans to expand its LPG production facilities to meet them, it soon became apparent that gas from such conveniently close-by sources would not be sufficient. For the supply of raw feed stock for the greatly enlarged LPG refrigeration and storage facilities in Ras Tanura the company had to go 61 pipeline miles inland to Abqaiq.

At Abqaiq Aramco can gather large quantities of rich, low-pressure gases produced in association with crude oil into one operating center. As much of these gases as possible had been injected deep into oil reservoirs for pressure-maintenance purposes; the rest was flared. In 1963 the company began recovering LPG from raw natural gas liquids (NGL), processed from these same low-pressure solution gases, which also yield as a by-product natural gasoline. Last year, to meet the steadily expanding market for refrigerated LPG from Ras Tanura, a second NGL recovery plant was installed in Abqaiq, and in the same industrial area two large spheroids have gone up which together are able to separate gas from 1,200,000 barrels a day of crude flowing from six different outlying GOSPs.

The NGL stream flows from Abqaiq to Ras Tanura in two separate pipelines, one each for natural gasoline and raw LPG. The former product needs no further processing on the shores of the Arabian Gulf, but raw LPG must have volatile sulfur compounds removed in Ras Tanura. The LPG is then handled as it always has been since Aramco began to produce it: first fractionated into propane and butane, then dried, refrigerated and stored, awaiting delivery, in cone-roofed insulated tanks. To the first six 80,000-barrel storage tanks the company has added two giants capable of holding 200,000 and 400,000 barrels apiece. Incremental enlargements of installations in Abqaiq over the years have increased the capacity of Aramco's refrigerated LPG production facilities from the original 4,000 to 37,500 barrels a day.

All the foregoing notwithstanding, it takes much more than expansion of oil facilities themselves to increase substantially the output of crude and products of petroleum. Any sustained effort along these lines eventually calls for more of everything which supports the undertakings. Provisions must be built into overall expansion plans for added utilities and communications, storage for spare parts, shops where equipment required for the new facilities can be repaired.

Adequate cars and trucks, many of special types and equipped with two-way radios, must be available for assignment to construction, operating and maintenance tasks. If job sites are a long way from headquarters, housing, even of a temporary nature, must be provided and aircraft furnished to span the distance with personnel and supplies. Offshore work calls for support of another kind: mobile drilling platforms, work barges, personnel launches and helicopter transportation. As more and bigger tankers come into Ras Tanura Port, these too must be taken into account when longrange plans are laid. After all the work has been done to enlarge facilities between oil fields and loading piers to meet increased demands for petroleum abroad, it would not look good for someone in Aramco to neglect to order the proper number and size of tugs to escort these paying customers to the docks to pick up their consignments

Brainerd S. Bates writes regularly on oil and the Middle East for Aramco World Magazine.

This article appeared on pages 20-27 of the November/December 1968 print edition of Saudi Aramco World.


Check the Public Affairs Digital Image Archive for November/December 1968 images.