The Complexities of Pipeline Construction

Pipeline construction has been in the news recently with the controversy over the Dakota Access Pipeline.  The DAP is one of the highest profile pipeline projects since the 800-mile Trans-Alaska Pipeline System built in the 1970’s.  The Trans-Alaska Pipeline has not had any incidents since it was built.  However, that is only one pipeline and is not included in the thousands of pipeline incidents across the United States.  Between 1986 and 2016 pipeline accidents have resulted in 548 deaths, 2,576 injuries, and over $8.5 billion in financial damages.  While the controversy surrounding the DAP are based on environmental concerns, moral implications, and land rights, the actual intricate process of pipeline building receives no attention.

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Pipeline construction is highly intricate.  Anything complex has the higher risk for things to go wrong, as they have routinely over the past 30 years.  The process for building pipelines involves planning a long route, lengthy review process, and faces the challenges of a lack of skilled laborers in the work force.

Selecting the route

The first step is selecting the route for the new pipeline.  This is a particularly difficult first stage considering of all the factors that go into this stage.  Obtaining permits is difficult because of the different areas the pipeline must go through.  This includes going across several state lines.  This will require coming up with several alternative routes in anticipating permitting issues.

The optimal path choice for a new pipeline is farther away from natural resources, geographical features, endangered species, and anything else that may be controversial.  As we have seen recently, satisfying all these qualifications is near to impossible.  There is nearly always something sacrificed.  However, it is important to remember that the first sacrifice is the most beneficial route for oil company.  Regardless, the Federal Energy Regulatory Commission has the last word on issuing permits.

The Review Process

The review process can take years.  This review not only looks at what the project involves but also determines whether the project should even proceed.  The FERC could come back and say that the project needs further review, but could actually mean it for the project to  submit their plan at another time.  Projects like these are subject to political trends.  This has proven true with the new Trump administration who has issued an Executive Order for the DAP to move forward.

It is not only the FERC that reviews the pipeline project.  The Environmental Protection Agency and the Army Corps of Engineers will also review the project.  Furthermore, it is not only federal agencies but also state and local agencies that will review the project.

Another way to go to expedite and simplify matters is to share an existing pipeline.  This is rather common for companies to do joint ventures.  This way multiple companies will negotiate once for the same permits.  The contractors themselves are subject to state licensing laws but there is no requirements for a federal license to perform pipeline work, only the project permit.  Also because these projects are usually independently funded they are not subject to the requirements of prevailing wages or labor agreements.

Technology plays a big role

Due to the sheer magnitude of a pipeline construction project new technologies have been a huge help.  The usage of drones has helped with the process by providing thermal and spectral images for all stages of the project.  Logistics is usually the greatest challenge during construction, ensuring people and materials arrive on time.  However, after construction is complete technology plays an even bigger role.  The requires maintenance crews to use internal pipeline sensors for leak detection.  These crews are usually on stand by for immediate action for potential leaks.

The greatest obstacle

It all comes back to the shortage of skilled labor.  All the long and time consuming aspects of pipeline construction are worthless without the skilled laborers to do the work.  During the Great Recession, a few years ago, pipeline construction workers found work elsewhere.  The knowledge that comes with being equipment operators, pipefitters, and welders have yet to fully return to the industry once it got back up and running again.

The Associated General Contractors of America have already contacted the Trump administration about the need to prioritize skilled trades education starting at the high school level.  There must be a combination of efforts to get the labor shortage in the blue collar industries back up to where it needs to be.  Projects and jobs in construction, logistics, and distribution have all taken a hit during the Great Recession and none have regained their strength.  A combination of luring workers back to the industry and making a career in construction appealing to the younger generations are the first steps.

 

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