Carbide Coatings, Terminal Automation Are More Opportunities in Oil and Gas

Oerlikon Metco's Surface Solutions Segment formulates wear- and corrosion-resistant carbide coatings for valves.

Oerlikon Metco's Surface Solutions Segment formulates wear- and corrosion-resistant carbide coatings for valves.

Protecting valves and related components from harsh environments is vital to reliable and cost-effective operations. One company that's promoting a line of carbide coatings for such applications is Oerlikon Metco.

Oerlikon Metco, based in Wohlen, Switzerland (U.S. headquarters in Westbury, N.Y.), announced the formation of the Surface Solutions Segment in June. The business unit manufactures specialty carbide coatings that are aimed at extending equipment life and thereby improve productivity and return on investment, a representative says.

Products include carbide formulations for weld overlay and thermal spray, as well as customized grades for specific applications. The goal of the wear-resistant materials, the representative stated, is to "significantly reduce downtime repairs and costs."

Surface Solutions produces carbide in cobalt matrices for wear resistance and in matrices of nickel, cobalt, and chromium for corrosion resistance. Combining these materials yields formulations that also resist impact, high compressive loads, deformation, cavitation, solid-particle erosion, severe abrasion, and other end-use challenges.

The type of carbide specified for a coating, along with its grain size, is determined by end-use requirements. In the oil and gas industry, for example, "the key is to design a combination with the right wear and the right corrosion resistance for the downhole-formation pH and hardness," the representative noted. Treating high-pressure gate valves with a carbide coating protects gates and seats from surface attacks and assures reliable actuation and safe operation, the representative adds.

In other news, meanwhile, the oil-and-gas and chemical industries continue to create opportunities for suppliers of valves, pumps, and related hardware, as demand for this equipment grows with the business, especially in North America.

The production and refining parts of these industries - which include biofuels - are not the only bright spots for equipment sales, however. A recent study by consultant Frost & Sullivan, titled "Analysis of the North American Terminal Automation Market," finds that the revenue generated from terminal automation projects will increase to $160.4 million in 2020, from $110.5 million last year. This equates to a compound annual growth rate of 5.5 percent, or about 45 percent in total value.

Terminal automation, which involves the management of loading and unloading operations, transactions and custody transfers, certification, and pipeline management, is a secondary market - if it's on the radar at all - for many suppliers of valves and pumps. Nevertheless, the move to upgrade to automation is going to affect every aspect of operations, and most equipment installations, in these facilities. Equipment that can be linked to and monitored remotely by digital controls is going to be a major part of these new and upgraded terminals.

Based on findings of the report, valve and pump manufacturers that want a share of this business could forge relationships with automation and software specialists to make their equipment suitable for these terminal installations.

Frost & Sullivan states that growth will come in two categories: brownfield projects that require "more diversified product portfolios for terminal automation, including field devices, controllers, and software," and greenfield terminals, which focus on custom automation systems to "streamline operational activities, custody transfers, and inventory management."

Individual project expenditures are sizeable. Brownfield automation projects have an average capital expenditure in the range of $2 million to $3 million, Frost & Sullivan finds.

Along with this will come the need for customer-specific automation, wireless technologies, and for components such as real-time locating devices, radio frequency identification mechanisms, and even ocular identification systems.

The report notes that terminal automation has lagged behind other areas of the oil and gas, chemicals and biofuels industries because there has been no "clear-cut business case to justify return on investment." Cloud-based computing technologies, however, provide operators with "cost-effective way[s to monitor business applications such as certification, transaction management and (importantly for valve and pump suppliers) loading operations while still using an on-premise model for mission-critical applications."

Cloud technologies also mean that solution providers will need high levels of after-sales support, both to assure that automated systems work efficiently and to keep operating costs low. As a result, "the software and services market is expected to offer greater opportunities than the commoditized hardware segment," the Frost & Sullivan report noted, "as end-users look to outsource their in-house engineering capabilities."

The ultimate goal is "centralized control and operations of all activity inside the terminal [to improve efficiency and further strengthen the grounds for automation uptake in North American terminals," the report concluded.

All Topics