Corrosion Monitoring System YESTERDAYS EXPERIENCE TODAYS TECHNOLOGY Todays

Corrosion Monitoring System YESTERDAY’S EXPERIENCE… TODAY’S TECHNOLOGY

Today's Outline • • • • Who is TXINS Corrosion Market Drivers General Corrosion & Corrosion-Assisted Cracking Hydrogen Damage Corrosion Inhibitors How TXINS’s Monitor Works Overview of the TXINS System Applications Installation Data Acquisition & Reporting Benefits, Limitations & Costs Common Questions Asked

Who is TXINS? TXINS : • Corrosion Monitors • NACE Inspectons • Industrial Coating Specifications TXINS is a group of individuals dedicated to the Corrosion Protection Industry with well over 100 years of experience. TXINS takes years of experience coupled with today’s technology and produces accurate, real-time, cost savings for their clients.

What’s Driving the Market Approach to Corrosion Monitoring? • Corrosion expenditures increasing • Major drivers: – Aging infrastructure – Higher pressures and temperatures – Higher concentrations of acid gases (e. g. , CO 2, H 2 S, Cl-) – Environmental costs associated with leaks or spills and lost production & commodity

What’s Driving the Market Approach to Corrosion Monitoring? (cont. ) • Drilling in environmentally sensitive areas under stringent regulations & environmental impact legislation. • Integrity management programs costs $2. 8 – $4. 6 billion annually, about 10 – 15% of company’s maintenance expenditures.

Internal Corrosion is #1 Issue for Production Pipelines 57. 7% Total # of Releases 12191, Pipeline Releases by Cause for all years combined

What’s Driving the Market to Change its Approach to Corrosion Monitoring? • Current corrosion detection methods employed are reactive – High-resolution “smart pigging”, measures wall loss, “REACTIVE” – Hydrostatic testing, integrity of the pipe wall “PRO-ACTIVE” – Direct assessments, visual inspection, “REACTIVE” – Corrosion Coupons, weight loss, “REACTIVE” – FSM-IT inspection, again wall loss, “REACTIVE” – Liquid and Gas sampling, “PRO-ACTIVE, but limited to sampling areas is an intrusive technology” – TXINS Monitoring, “PRO-ACTIVE”, monitors the change in the production of hydrogen directly proportional to the corrosion rate.

Corrosion Monitor Comparison ER Probes LPR Electro. Chemical Noise Ultrasonic Scan FSM-IT TXINS Monitoring System Corrosion over time Electrical signal Polarization resistance Fluctuation in current and voltage noise Wall thickness Wall loss Hydrogen production Detects Corrosion Yes Yes No No Yes Multi-phase Corrosion Monitoring No No No Yes Detects Pits or Wall Loss No No Yes No Inhibitor Monitoring No No Yes No No No Yes Reactive Proactive with real -time communication Proactive with real-time communication Reactive Proactive Intrusive Yes Yes No No No Shut Down to Install Yes Yes No, except for safety reasons No Retrieval Limitation Shut Down / pressure None Can be Used in High Temperature Environments Limited Limited Yes (320 F/ 160 C) Or weld attachment Can be Used in High Pressure Environments Limited Yes Yes Feature Data Read Proactive or Reactive Coupons

Corrosion Monitor Comparison Coupons ER Probes LPR Electro-Chemical Noise Ultrasonic Scan FSM-IT TXINS Monitoring System Service Environments All Conductive Aqueous All All except high O 2 environments Presence of Electrolyte No No Yes No No No Point Point/Section Pigging Compatible No No Yes Yes Continuous Monitoring No Yes Yes No Yes Satellite Communication No No No Yes Cost to Production from Shutdowns High Minimal None Cost of Equipment Low Medium High Medium Labor Cost to Install Low Medium High Medium Labor Cost to Repeat High High Low Feature Area of Coverage

General Corrosion • This term is reserved for straightforward dissolution of a metal in corrosive water • Example: dissolution of steel in HCl. Simple systems like this serve to demonstrate the electrochemical basis of corrosion reactions, e. g. : anodic reaction: Fe ----> Fe++ + 2 e- (e = electron) cathodic reaction: 2 H+ + 2 e- ----> H 2 (hydrogen gas)

Corrosion and Corrosion-Assisted Cracking • Depending on the reservoir composition, – carbon dioxide (CO 2) – hydrogen sulfide (H 2 S), or a combination of both can be present in hydrocarbons. • The terms "sweet" and "sour" are used in the oil and gas industry to identify hydrocarbons that contain CO 2 and H 2 S, respectively.

Corrosion and Corrosion-Assisted Cracking • In the oil and gas industry, water is the catalyst for corrosion. When water is combined with CO 2 or H 2 S the environments form the following reactions: • • H 2 CO 3 Reaction: Fe+H 2 CO 3 ->Fe. CO 3+H 2 • H 2 S Reaction: Fe+H 2 S+H 2 O->Fe. S+2 H • Or combination if both gases are present

Hydrogen Damage • Hydrogen may enter a metal surface by the cathodic reduction of hydrogen or water: • 2 H+ + 2 e- → 2 H Absorbed (acidic waters) 2 H 2 O + 2 e- → 2 H Absorbed + 2 OH- (neutral waters) • Normally, the absorbed hydrogen at the surface recombines to form hydrogen gas: • 2 H Absorbed → H 2 • Sulfide (S 2 -), prevents Hydrogen gas from forming.

Hydrogen Damage Hydrogen Induced Cracking (HCI), or Blisters. H 2 Outside Metal Surface H Inside Metal Surface Corrosive Environment H

Hydrogen Damage • Hydrogen may enter a metal surface by the cathodic reduction of hydrogen or water: • 2 H+ + 2 e- → 2 H absorbed (acidic waters) 2 H 2 O + 2 e- → 2 H absorbed + 2 OH- (neutral waters) • Normally, the absorbed hydrogen at the surface recombines to form hydrogen gas: 1. 2 HAbsorbed → H 2 2. Sulfide (S 2 -), prevents Hydrogen gas from forming.

Corrosion Inhibitors d ?

How TXINS’s Monitor Works Satellite Monitoring equipment, above ground level Liquid Epoxy TXINS Monitoring Systems Vessel - Cap under vacuum Adhesive External Pipe wall Pipe H 0 Environment H 0 e- H 2 H 0 Anodic Area Cathode Area e- H 0 H 0 Wall Internal gas/liquid H 2 H 0 e. OHOH- OHFe ++ Fe(OH)2 Cathode Area H 0 Fe ++ e- e. H 0 H 0 H 2 H 0 Inhibitor film H 0

Permeation Rates of H 0 VS Carbon Steel Thickness

Table of Corrosion Scenarios Hydrogen Permeability of Steels

TXINS T-1 or T-2 System Remote Communications Via Satellite TXINS’s T-1 or T-2 Monitor Non Intrusive Hydrogen monitoring Cap ATOMIC HYDROGEN FROM CORROSION

Applications Any metal substrate where hydrogen is being produced as a result of the corrosion process. • • Pipelines (Sour) • Pipelines (Natural Gas) Pipeline (Sweet) • Pipelines (Condensate) Gas Plants • Treaters Water Disposal • Vessels Petrochemical • Amine Towers Water Floods • Refinery Closed or Sealed Rolling Stock (rail cars or tanker trucks)

Applications Gas and Oil Production (H 2 S) • Oil/Gas Gathering and Transmission Lines • Oil/Gas Well Heads • Sour Water Flood Lines • Underground Gas Storage Facilities

Applications Gas-Oil Separation Plants and Gas Plants (H 2 S) • Amine Units – Inlets, Outlets, transfer lines • Contactors • Absorbers • Flash Drums • Wash Columns and Drums • Blow down Drums • Flare Lines • Sour Water Strippers • Sour Gas Gathering Lines • Fractionators • Catalytic Cracker – overhead recovery system • Hot Wells • High and Low pressure sour gas separators

Applications Refinery HF Alkylation Units • • • Acid Settler Tanks Accumulators Condensors Depropanisers Transfer Lines Recontactors

Installation of the Equipment • Site preparation – hand tool only to white metal • Bonding the vessel to the pipe - Liquid epoxy • Mechanically clamp the vessel to the pipe • Mount monitoring equipment to a pole above ground or to secured area on the rolling stock

Reporting • Graphical representation of corrosive activity • Programming alarms can be set by Client • All client information is password protected for their use only

Graph Showing 2 Corrosion Events ABC Co. 2 nd Event 1 st Event

Customer #2 Re-evacuate Re-evacuate

Customer #2

Benefits • • Real time data Records Non-intrusive Low maintenance Remote capability Coordinates corrosion programs Cost effective

Benefits (cont. ) • • • No down time Works in Conjunction with other Technologies Early Corrosion Detection High Risk Remote Areas Can be Monitored Low Installation and Operating Costs High Temperature Installations (200˚C) “Can be placed on higher temperature if welded”

Limitations of the Technology • No correlation of TXINS data to intrusive probes or corrosion coupons • Does not work in fully oxygenated water systems or ponds • Each system has to be looked at individually, no comparison

Costs • Standard Satellite Unit costs will vary dependent on how many transducers are included • Remote Satellite data collection and download of data at competitive rates $75 -100/month/unit • Remote Cellular data collection and download of data at competitive rates • Installation costs will vary as a result of location and number of units to be installed

Commonly Asked Questions and Answers Q 1: Does your Hydrogen Vessel work in Sweet and Sour Gas Systems? A 1: Yes

Commonly Asked Questions and Answers Q 2: Does the internal process pressure affect the hydrogen flux process? A 2: No Q 3: Does temperature influence the monitor’s accuracy? A 3: No and yes

Commonly Asked Question and Answers Q 4: Can the TXINS monitor environments containing bacterial corrosion or iron sulfide deposits? A 4: Yes Q 5: Does the formation of Hydrogen polarization film caused by cathodic protection on the external of the pipe affect the TXINS monitor? A 5: No

Commonly Asked Questions and Answers Q 6: Is the TXINS monitoring system capable of monitoring internal environments that have been internally coated? A 6: Yes Q 7: Where do you typically install the TXINS caps? A 7: Each application will be different

Commonly Asked Questions and Answers Q 8: Can the TXINS monitor help in evaluating the effectiveness of my corrosion inhibitors? A 8: Yes Q 9: Can the results of the TXINS monitor give me a metal loss per year (“MPY”) value? A 9: Yes and No

Commonly Asked Questions and Answers Q 10: Will the TXINS monitor work in all my corrosive environments? A 10: No Q 11: Will the TXINS monitor work in a high ph environment? A 11: Yes

Conclusion • TXINS Monitor is: – Non-intrusive – Pro-active corrosion monitor – Cost effective – Remote communication and installations – TXINS gives the flexibility required to meet all our customers, corrosion monitoring needs.

Thank you for your time. If you require any further information, please contact: Corrosion Monitors USA/ Intl. -877. 378. 2377 Canada- 403. 250. 3382 Email- khavran@txins 1. com