Study says corrosion costs US firms $440 billion/year

March 12, 2001
Corrosion problems are costing US industry $440 billion/year, participants of a Houston meeting were told Monday. More than 50% of all pipeline incidents and 60-80% of all process plant failures are directly related to corrosion, said members of the National Association of Chemical Engineers.


Sam Fletcher
OGJ Online


HOUSTON, Mar. 12�Corrosion problems are costing US industry $440 billion/year, participants of a Houston meeting were told Monday.

Metal corrosion triggered by water, harsh chemicals, and even microbes affect all aspects of industry, said members of the National Association of Chemical Engineers (NACE) at their conference and exposition. And it is especially widespread within the oil and gas industry.

More than 50% of all pipeline incidents and 60-80% of all process plant failures are directly related to corrosion, said Bhubinder Singh of Deepwater Corrosion Services Inc., Houston, at an opening session on corrosion challenges for deepwater development.

This year marks the first time that NACE has dedicated a session to deepwater corrosion problems, said Khlefa A. Esaklul of BP Exploration, who chaired that discussion.

The cost of repairing or replacing damaged equipment escalates rapidly as offshore development advances into deeper waters around the globe. So the emphasis is on careful planning and thorough testing at the start of a project to avoid problems later, said several corrosion engineers.

�Everything has to work from the first day, with no failures for the 20-year life of a project. At least, that has been our goal,� said Lillian Skogsberg of Shell Global Solutions US, part of the Royal Dutch/Shell Group.

�The key issue in deepwater operations is reliability,� agreed Jutta Klower of the German firm Krupp VDM GmbH, which has tested the effects of hydrogen sulfide on various metal alloys to determine what combinations best withstand that corrosive substance.

Ronald W. Shutz of RMI Titanium Co., Spring, Tex., also outlined some of the critical points on a deepwater spar platform and subsea production system where titanium could contribute to strength and corrosion resistance.

But risk-based management of offshore corrosion problems should start with a review of all previous problems and a reappraisal of prior practices, said Singh. That�s because 70% of all offshore platform problems usually �are not reported back to the designer,� he said.

Risk management for corrosion integrity in offshore operations �always looks expensive on paper, but I think we can show it�s cost effective,� he told industry representatives at that morning session.

Moreover, Singh said, the US Minerals Management Service, which governs offshore oil and gas operations in US waters, has made it clear that the industry must protect the integrity of its offshore facilities through the life of the equipment. �The MMS speaks softly but carries a big stick� in its ability to curtail unsafe offshore operations, he warned.

Risk management programs that focus inspections and maintenance on the equipment and facilities most likely to cause problems are a good technical tool for the industry since �80% of the failures occur in 20% of the equipment.� But juries often do not understand the rationale of that approach, said Gene F. Rak, an independent corrosion consultant who serves as an expert witness and researcher in litigation cases.

Industrial safety, Rak said, is summed up in a quote from the 19th century political economist Arnold Toynbee: �Technology now forces on us a standard previously expected only of the saints.�

But it�s tough to live up to those standards after a period of low prices, mergers, and acquisitions have reduced corporate staffs and outsourced maintenance programs to third-party contractors, he said.

In today�s litigious society, Rak said, it�s imperative for corporate engineers to keep abreast of technological advances and government regulations in their fields. It�s also important, he said, to maintain complete documentation of all maintenance, replacements, upgrades, and other equipment changes along with training, policy decisions, and other factors that may become evidence in a court case.

�The average length of a (industrial) case is over 10 years now. You have lawyers retiring and having to bring new lawyers up to speed on a case that�s still in progress,� Rak said.

At the close of Monday�s sessions, a federally sponsored research team was to release a preliminary study that found corrosion damage cost the US economy an estimated $440 billion in material, labor, equipment and other losses during 1998. That amounts to 5% of the gross domestic product and is up 46% from the last similar study in 1995, officials said.

It does not count indirect costs to others aside from the owners and operators of the corroded equipment, officials said. Complete results of that study are to be presented to Congress in September.

Contact Sam Fletcher at [email protected]