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    Eleme Petrochemical Company Limited

    8thto 10thJune 2009

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    Insurance Survey of,

    Eleme PetrochemicalsCompany Limited, PortHarcourt, Nigeria

    8thto 10thJune 2009

    Draft

    Charles Taylor technical

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    Report for

    United Insurance Brokers,Mansell Court,69 Mansell Street,London,E1 8AN

    Main Contributors

    Doug Scott

    Issued by

    Eur Ing Doug ScottB Tech C Eng CSci F I Chem E MEI

    Reviewed by

    Jeff AshmanBEng (Hon) C Eng MIEE

    Approved by

    Richard RadevskyBSc, CEng, CSci, CEnv, PEng, FICE, FCIWEM,MEI, MIFireE, FCIArb

    Ch l T l t h i l

    Insurance Survey of,

    ElemePetrochemicalsCompany Limited,Port Harcourt, Nigeria

    8thto 10thJune 2009

    Draft

    Charles Taylor technical

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    i

    Executive Summary

    Introduction

    Charles Taylor technical has been commissioned by United Insurance Brokers (UIB) toproduce an underwriting risk survey report, for insurance purposes of the Eleme

    Petrochemical Company Limited facilities at Port Harcourt Nigeria.

    Significant Changes Since the Last Survey

    The site has undergone significant renovation since the last survey in 2006. Therehave been two further shut downs for refurbishment andf improvements after the lowlevel of maintenance during the years of NNPC ownership. A small project has beenundertaken to provide Virgin C5feedstock to one of the furnaces. There has been anincident involving the Olefin plant cold box but this has been resolved without the

    need for an insurance claim.

    The plant is operating normally with the main limitation on production being theavailability of feedstock.

    The Site

    Eleme Petrochemical Company Limited (EPCL) was originally a subsidiary of theNigerian National Petroleum Organization Corporation (NNPC) but was sold to

    Indorama in May 2006. EPCL operates an olefins plant and downstream units,mostly polymers at Port Harcourt Nigeria. The facilities date from the mid 1990s.

    Natural hazards in the area are modest.

    The facilities are relatively modern with good spacing between the individual processunits, utilities and the storage area. However, there is an element of congestionwithin some of the process facilities. The level of loss prevention features variesbetween process units, with only a limited number of remote isolation valves on large

    process inventories in the ethylene plant.

    Storage facilities are generally to modern standards but unusually, for a relativelynew facility, do not have independent high level alarms.

    Administ rat ion

    P i t th l f EPCL t I d NNPC i t i d ll ti ht t l

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    ii

    Activities in most areas follow accepted industry practice but are, sometimes at anearly stage. For example, the site will use the MAXIMO Computerised MaintenanceManagement System (CMMS) but this is still at an early stage of implementation,

    Whilst some updating of procedures and documentation has been undertaken, thereis still room for improvement, even in some of the procedures which have alreadybeen updated.

    Fire Protection

    The fire detection and protection systems have been overhauled and are largelyoperational. However, a number of defective alarm systems were noted around thesite.

    One of the electrical fire pumps was in continuous operation to supply water for washdown and a significant number of fire fighting hoses were being used for operationalreasons.

    New investment includes a replacement fire alarm system in the polyethylene plant

    and a new fire truck.

    In summary, EPCL has vastly improved in terms of mechanical integrety as a consequenceof the capital expenditure mantainence turnarounds since Indorma took over the facilities.The focus now needs to be in improving procedural aspects and ensuring all documentationat the site is updated.

    Insured Values

    The replacement values for the facilities were estimated by AVC (of the UK) in 2006 to beUS$ 868 million. The property values have not been increased since.

    The business interruption sum insured is US$ 83 million with a 12 month indemnity period.

    Loss History

    Since Indorama took over the site, there have been two claims:

    May 2008 damage to cold box, this was subsequently withdrawn

    June 2009 loss of production as a consequence of lack of feedstock, currentlyestimated at US$ 4 million.

    Loss Estimates

    Scenario

    PropertyDamage

    (US$

    BusinessInterruption

    (US$Combined

    (US$ illi )

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    iii

    Recommendations for Risk ImprovementTen recommendations were made as a result of the survey:

    Recommendation Descripti on Category

    09-01 Sampling Procedures Priority

    09-02 Fire and Gas Alarm Systems Priority

    09-03 Control Room Doors CAPEX

    09-04 Urea Formaldehyde Foam (Cold Insulation) CAPEX

    09-05 Document Control Human Factor

    09-06 Operator Emergency Training Human Factor

    09-07 Permit to Work (PTW) System Human Factor

    09-08 Isolation for Maintenance Human Factor

    09-09 Electrical Integrity Human Factor

    09-10 Trip By-Pass Procedure Human Factor

    The status of the 58 recommendations from previous surveys is summarised below:

    Recommendation Summary June 2009

    Complet e, 17

    No Change, 7In progres s,

    23

    Withdr awn, 6

    Unkn ow n, 5

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    iviv

    Overall Presentation Sheet

    Natural Perils 3.5 Management 3.5 Fire and Gas Detection 2.8

    7 Parameters 0 0 1 1 5 5 Parameters 0 0 0 2 2 2 Parameters 0 0 0 2 0

    External Exposures 2.6 2.3 Water Supplies 3.0

    9 Parameters 2 0 1 0 6 6 Parameters 0 1 2 2 1 4 Parameters 0 0 1 2 1

    Inherent Hazard 1.0 Permit to Work System 2.9 Drainage 3.0

    6 Parameters 2 1 2 0 0 6 Parameters 0 1 1 0 3 3 Parameters 0 0 0 2 0

    Layout 2.8 2.3Process Area

    Fire Protection 1.9

    2 Parameters 0 0 0 2 0 6 Parameters 0 2 1 2 1 6 Parameters 0 1 3 1 0

    Control Systems 2.0 2.3 Offsites Fire Protection 1.7

    3 Parameters 0 1 1 1 0 3 Parameters 0 0 2 1 0 7 Parameters 1 1 1 2 0

    Process Safety Systems 1.9 1.7 2.0

    5 Parameters 0 2 2 1 0 3 Parameters 0 1 2 0 0 3 Parameters 0 1 0 1 1

    Loading/ Unloading N/A Inspection Procedures 2.9Passive

    Protection 1.8

    4 Parameters 0 0 0 0 0 5 Parameters 0 1 1 1 3 4 Parameters 0 1 1 0 0

    Storage 1.5 2.6 Foam Supplies N/A

    5P t 1 2 1 1 0 5P t 0 1 2 2 1 3P t 0 0 0 0 0

    Storage areas need some refurbishment Safety procedures are generally to a high stadard.

    Limited process safety systems installed but

    upgrades being undertaken.

    A new management of change procedure has been

    developed but still has a number of drawbacks.

    Systems appear to be in good condition

    Most porducts are transported by truck in a non

    haardous form. A new road tanker unloading facility

    has been built with basic facilities.Pipeline systems

    were not reviewed in detail during the survey

    Inspection Procedures are to a generally good

    standard with a well trained and enthusiastic

    workforce. Some aspects such as Positive Materials

    Indentification could be improved.

    The site is moving is considering a move to Risk

    Based Inspection

    Level of passive protection varies between different

    process units

    Layout between units is generally spacious. There

    are some congested areas within the units

    A considerable amount of mainteance work has

    taken place since the take over by Indorama. The

    condition and reliability of the equipment is much

    improvied. Routine maintenance issues, such a sthe full implenetation of the MAXIMO planning

    system needs

    Systems have been repaired and are fully

    operational

    DCS systems being replaced.

    Although control rooms are blastproofed, the doors

    are frequently left in the open position.

    A new technical serivces function has now been

    developed.

    Systems examined were generally good. However

    some unsealed penetrations through dikes in the

    LPG area were noted.

    All senior management positions occupied by ex-

    pats.

    Fire detection systems have been repaired and the

    system in the Polyethylene plant replaced.

    However, a number of falied loops were noted in

    different systems around the site.

    Protections

    Operating Procedures

    Hardware Software

    Minor exposure from other facilities. There has

    been previous unrest with the local community

    Operating procedurs are a mixture of orginal and new

    procedures. Some operating manuals appear

    limitied and full information was not available.

    Some undesirable operating procedures were noted,for example the operation of flare drums on manual

    control

    Fire water system appears in good condition,. There

    is still a problem with use of fire water forwashdown,

    etc.

    A new permit system has been introduced. And

    generally works well but some detailed

    improvements are possible..

    No problems were noted with drainage during the

    survey.

    Maintenance

    Safety Procedures and

    Practices

    Management of

    Change

    Utility Area Fire

    Protection

    Engineering/

    Technical Services

    0

    1

    2

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    Latest

    Assess ment

    Latest

    Asses sment

    Latest

    Assess ment

    Previous

    Assessment

    Previous

    Assessment

    Previous

    Assessment

    Printer Friendly Versi

    2008 Charles Taylor technical Overall Presentation Sheet

    Natural Perils 3.5 Management 3.5 Fire and Gas Detection 2.8

    7 Parameters 0 0 1 1 5 5 Parameters 0 0 0 2 2 2 Parameters 0 0 0 2 0

    External Exposures 2.6 2.3 Water Supplies 3.0

    9 Parameters 2 0 1 0 6 6 Parameters 0 1 2 2 1 4 Parameters 0 0 1 2 1

    Inherent Hazard 1.0 Permit to Work System 2.9 Drainage 3.0

    6 Parameters 2 1 2 0 0 6 Parameters 0 1 1 0 3 3 Parameters 0 0 0 2 0

    Layout 2.8 2.3Process Area

    Fire Protection 1.9

    2 Parameters 0 0 0 2 0 6 Parameters 0 2 1 2 1 6 Parameters 0 1 3 1 0

    Control Systems 2.0 2.3 Offsites Fire Protection 1.7

    3 Parameters 0 1 1 1 0 3 Parameters 0 0 2 1 0 7 Parameters 1 1 1 2 0

    Process Safety Systems 1.9 1.7 2.0

    5 Parameters 0 2 2 1 0 3 Parameters 0 1 2 0 0 3 Parameters 0 1 0 1 1

    Loading/ Unloading N/A Inspection Procedures 2.9Passive

    Protection 1.8

    4 Parameters 0 0 0 0 0 5 Parameters 0 1 1 1 3 4 Parameters 0 1 1 0 0

    Storage 1.5 2.6 Foam Supplies N/A

    5P t 1 2 1 1 0 5P t 0 1 2 2 1 3P t 0 0 0 0 0

    Storage areas need some refurbishment Safety procedures are generally to a high stadard.

    Limited process safety systems installed but

    upgrades being undertaken.

    A new management of change procedure has been

    developed but still has a number of drawbacks.

    Systems appear to be in good condition

    Most porducts are transported by truck in a non

    haardous form. A new road tanker unloading facility

    has been built with basic facilities.Pipeline systems

    were not reviewed in detail during the survey

    Inspection Procedures are to a generally good

    standard with a well trained and enthusiastic

    workforce. Some aspects such as Positive Materials

    Indentification could be improved.

    The site is moving is considering a move to Risk

    Based Inspection

    Level of passive protection varies between different

    process units

    Layout between units is generally spacious. There

    are some congested areas within the units

    A considerable amount of mainteance work has

    taken place since the take over by Indorama. The

    condition and reliability of the equipment is much

    improvied. Routine maintenance issues, such a sthe full implenetation of the MAXIMO planning

    system needs

    Systems have been repaired and are fully

    operational

    DCS systems being replaced.

    Although control rooms are blastproofed, the doors

    are frequently left in the open position.

    A new technical serivces function has now been

    developed.

    Systems examined were generally good. However

    some unsealed penetrations through dikes in the

    LPG area were noted.

    All senior management positions occupied by ex-

    pats.

    Fire detection systems have been repaired and the

    system in the Polyethylene plant replaced.

    However, a number of falied loops were noted in

    different systems around the site.

    Protections

    Operating Procedures

    Hardware Software

    Minor exposure from other facilities. There has

    been previous unrest with the local community

    Operating procedurs are a mixture of orginal and new

    procedures. Some operating manuals appear

    limitied and full information was not available.

    Some undesirable operating procedures were noted,for example the operation of flare drums on manual

    control

    Fire water system appears in good condition,. There

    is still a problem with use of fire water forwashdown,

    etc.

    A new permit system has been introduced. And

    generally works well but some detailed

    improvements are possible..

    No problems were noted with drainage during the

    survey.

    Maintenance

    Safety Procedures and

    Practices

    Management of

    Change

    Utility Area Fire

    Protection

    Engineering/

    Technical Services

    0

    1

    2

    3

    4

    0

    1

    2

    3

    4

    0

    1

    2

    3

    4

    1

    2

    3

    4

    0

    1

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    1

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    0

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    2

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    1

    2

    3

    4

    Latest

    Assess ment

    Latest

    Asses sment

    Latest

    Assess ment

    Previous

    Assessment

    Previous

    Assessment

    Previous

    Assessment

    Printer Friendly Versi

    2008 Charles Taylor technical

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    v

    Contents

    1. Introduction 1

    1.1. The Company 21.2. The Location 2

    2. Background 4

    2.1. Insured Values 4

    2.2. Loss History 4

    3. Exposure to Perils 6

    3.1. Fire and Explosion 6

    3.2. Surrounding Exposures 6

    3.3. Subsidence and Collapse 7

    3.4. Earthquake 73.5. Volcano 7

    3.6. Tsunami 8

    3.7. Lightning 8

    3.8. Flood 9

    3.9. Wind and Storm 9

    3.10. Vehicle Impact 10

    3.11. Vessel Impact 10

    3.12. Aircraf t Impact 10

    3.13. Riot Strike and Civil Commotion 10

    3.14. Terror ism and Sabotage 10

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    vi

    4.4. Machinery Breakdown 15

    4.5. Machinery Breakdown Business Interruption 15

    4.6. Summary of Loss Estimates 16

    5. Description of Installation 175.1. Location 17

    5.1.1. Meteorological Information 17

    5.1.2. New Projects 17

    5.1.3. Turn Around Maintenance (TAM) 17

    5.2. Product ion Facilit ies 18

    5.2.1. Process Units 195.2.2. Process Hazards 21

    5.2.3. Layout 22

    5.3. Control and Process Safety Systems 27

    5.3.1. Basis 27

    5.3.2. Control Room Design 27

    5.3.3. Emergency Shutdown Systems 28

    5.3.4. Remote Isolation, Depressurisation and Blowdown 285.3.5. Pressure Relief Systems 28

    5.3.6. Combustion Safeguards 29

    5.3.7. Shaft Sealing 29

    5.4. Feedstock Supply and Product Transfer 29

    5.4.1. Road 29

    5.4.2. Pipeline 29

    5.5. Storage Facilit ies 305.5.1. Atmospheric Storage 30

    5.5.2. Pressurised Storage 31

    5.5.3. Refrigerated Storage 33

    5.5.4. Warehousing 37

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    vii

    5.6.7. Flare 42

    5.6.8. Effluent Treatment 42

    5.7. Major Equipment Items 42

    6. Administration 44

    6.1. Organisation 44

    6.2. Operations 44

    6.3. Maintenance 49

    6.4. Engineering 54

    6.5. Inspection 56

    6.6. Safety, Health and Environment 59

    6.7. Emergency Response 63

    6.8. Security 64

    7. Fire Protection 67

    7.1. Fire and Gas Detection 67

    7.2. Fire Water System 687.3. Active Systems 70

    7.4. Passive Systems 71

    7.5. Mobile Equipment 73

    7.5.1. Fire Trucks 73

    7.5.2. Foam and Dry Powder Stocks 74

    8. Recommendations for Risk Improvement 75

    8.1. New Recommendations 75

    8.2. Previous Recommendations 80

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    1

    1. Introduction

    Charles Taylor technical has been commissioned by United Insurance Brokers to producean underwriting survey report for insurance purposes of the Eleme Petrochemical Companyplant at Port Harcourt, Nigeria. Due to time limitations, not all parts of the site were visitedand some information has been taken from other sources, including previous survey reports.

    The survey concentrated on Property Damage, Machinery Breakdown and BusinessInterruption risk to the facility.

    The following personnel were involved in the survey their assistance is acknowledged withappreciation.

    United Insurance Brokers

    Marc Perrin Senior Broker

    Eleme Petrochemicals Co Ltd.

    Deepak Bang Head Commercial

    Subhash Chandra Sarkar Head of Olefins Department

    S Dave Offsites Manager

    A K Gupta Power Plant Manager

    Neerja Gupta Utilities Manager

    V K Gurung Security Manager

    B N Jha Projects Manager

    A Michinel Technical Services Manager

    A Mohapatra Polypropylene Plant Manager

    S Sadmanabham Polyethylene Plant Manager

    S B Sagdeo Instrument Maintenance Manager

    S H Sircar HSE Manager

    A Verma Inspection Manager

    V K Gurung Security Manager

    And others

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    2

    1.1. The CompanyEleme Petrochemical Company Limited (EPCL) was originally part of Nigerian NationalPetroleum Corporation (NNPC) which is wholly owned by the Nigerian Government.

    However, in May 2006, EPCL was sold to Indorama, a multinational company based inIndonesia with interests ranging from petrochemicals, textiles and cement. Timeframe forthe takeover is shown below:

    The NNPC organization was centrally controlled, with individual subsidiaries having limitedauthority for expenditure and other decision making. This resulted in difficulties in planning,recruitment and maintenance of the major locations. The sale of EPCL to Indorama hasloosened the constraints of central control and has allowed access to funds for long overdue

    maintenance at the site, as well as changes to the management structure and operatingprocedures.

    The senior management members at the site have all arrived since privatisation and aremostly Indian nationals. In addition, there are Indian expats at all levels within theorganization. Most of the original Nigerian workforce has left EPCL for other parts of NNPC.T i i b i t f Ni i ti l ith th l t i t ti f

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    3

    Due to the lack of maintenance and feedstock limitations, the process units had seldomperformed at anything like full capacity and were frequently shutdown. Since the take overby Indorama, there has been significant capital investment and a number of shutdowns forsite wide maintenance and refurbishment.

    The plant is located near the town of Eleme, approx 15 minutes drive from Port Harcourt, thecapital of Rivers State.

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    4

    2. Background

    2.1. Insured Values

    2.1.1. Property Values

    The replacement values for the facilities were estimated by AVC (of the UK) in 2006 to beUS$ 868 million. A number of items commonly included in valuations such as officebuildings, contingencies, debris removal and firefighting expenses have been excluded.Additionally, there is no value for stocks.

    A breakdown of the replacement value is given below:

    Unit US$

    Ethylene Cracker 284,800,000

    Polyethylene 181,700,000

    Butene-1 10,500,000

    Polypropylene 80,100,000

    Polypropylene Bagging 24,200,000

    Polypropylene Bagging 10,500,000

    Storage Area (Including Pipeline to Refinery) 57,600,000

    Power Station 109,300,000

    Cooling Water 23,100,000

    Demineralised Water 33,400,000

    Air and Nitrogen 22,900,000

    Flare Area 9,400,000

    Effluent Treatment (Including Incinerator) 16,800,000

    Administration and General Excluded

    Refinery Tank Farm 3,700,000

    Total 868 000 000

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    5

    2.2. Loss HistoryTwo claims have been reported since the 2006 survey:

    Date Loss AmountUS$

    Details Comments

    May 2008 - Damage to Olefin Plant cold box. Thecause has not been positively identified

    but is probably due to thermal cracking ofthe cold box during start-ups andshutdowns since the plant wascommissioned.

    The claim was subsequently withdrawn.

    Repairs were made and a replacementcold box ordered. This has now arrivedon site and will be installed at the nextmaintenance turnaround. The new coldbox is of a more modern design to theoriginal and is understood to be morerobust.

    10 Jan 2009 4,000,000 Limitations of feedstock supply. This hasreduced production at the plant and alsocaused an increased cost of working as aresult of increased utility usage per unit

    of production.

    It is not clear if this loss is covered by thepolicy or not.

    A detailed loss history of the site prior to the take over by Indorama was not provided but thefollowing information is available from previous survey reports and meetings during thesurvey. It is understood that there have been no significant insurance claims at the sitesince commissioning.

    Date Event

    10 Jan 98

    03 Mar 98

    23 Apr 98

    Bush Fires following Flare Shoot-Outs

    13 Jan 98 Minor fire resulting from sparks from welding work, igniting gasoline from a flange being dismantlednearby

    22 May 98 Minor fire caused by leakages on Solution Absorber Unit at Polyethylene Plant

    17 Jun 98 Minor Fire from Major Leakage of Ethylene from Blanked Flange of Faulty Safety Valve

    11 Sept 98 Minor fire following leakage of hot oil from Polyethylene unit DTA Vaporiser Area

    20 Sep 98 Major Fire following Ignition and subsequent Explosion of Jerry-Can of gasoline in Natural GasLiquids reception area control room

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    3. Exposure to Perils

    3.1. Fire and Explosion

    Fire and explosion hazards are inherent in hydrocarbon facilities. The potential size of a losswill be determined by the inventories of hydrocarbon materials, spacing and fire protection

    facilities. The likelihood of a loss is related to operating and other procedures. These arediscussed in detail in the main body of the report.

    3.2. Surrounding Exposures

    The nearest large industrial site is NNPCs Port Harcourt refinery (approximately 6 kmaway), there are also some oil production facilities (approximately 5 km away). There are nosignificant industrial activities around the EPCL site and exposure is considered low.

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    Local communities extend to the outer perimeter fence in some places. In any event theprocess and storage facilities are located well away from the boundary fences and would notbe exposed to small fires from shanty dwellings, car fires, etc.

    3.3. Subsidence and Collapse

    No signs of subsidence or collapse were noted during site visits, although there was veryminor damage to some pipe support footings reportedly as a result of erosion from

    condensate drains noted in a previous survey.

    3.4. Earthquake

    The Munich Re World Map of Natural Hazards ranks the area as Zone 0 (on a scale of 0-4)equivalent to Modified Mercalli V or below.

    In the unlikely event of an earthquake, there could be intensification for wet/loose sediments(sand and alluvial deposits) subsoil conditions in Port Harcourt.

    3.5. Volcano

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    3.6. Tsunami

    The Munich Re World Map of Natural Hazards does not consider the area to be exposed totsunami. In any event the plant is set well back from the sea.

    3.7. Lightning

    The Munich Re World Map of Natural Hazards ranks the area as Zone 1, with 2 6lightning strikes per km2 per year.

    There are around 140 days per year and there have been numerous lightning strikes at theplant. At least two have resulted in minor fires.

    Actions taken to minimise the impact of lightning includes ground resistivity surveys.

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    3.8. FloodThere is no history of flooding either from rainfall or sea water inundation.

    3.9. Wind and Storm

    The Munich Re World Map of Natural Hazards considers the area to have a mediumexposure to hailstones and low exposure to tornado

    Whilst the region is prone to electrical storms, it is not generally subject to significantwindstorm activity.

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    3.10. Vehicle Impact

    Vehicles are free to travel on roads around the site and therefore vehicle impact is possible.

    3.11. Vessel Impact

    There is no jetty associated with the site and therefore marine impact is not possible.

    3.12. Aircraft ImpactThe Port Harcourt international airport handles both fixed wing and helicopter flights and islocated approximately 25 km from the site. There is also a Chevron Texaco support baselocated around 5 km from the site. Flight paths are reported to avoid the EPCL site and noaircraft were noted overflying during the survey.

    3.13. Riot Strike and Civi l Commotion

    There have been inter-tribal conflicts in the River State in recent years, together with adepressed economy. In consequence some serious anti-oil industry incidents, includingtheft, vandalism and sabotage have occurred. These have primarily affected the upstreamoil industry but the downstream sector has also been affected.

    There has been previous resentment by the local community in the past but this has noweased following the increased deployment of armed police and troops within the siteperimeter. This eventually culminated in the kidnapping of a number of Indorama employees

    and dependents (including women and children). The captives were released without loss oflife and security has progressively increased ever since. In the near future, it is intended tohouse all Indoramas ex-pat staff and their families within the production site boundary.

    3.14. Terrorism and Sabotage

    There is considerable unrest in the Niger Delta region of Nigeria and the Nigerian Military arecurrently conducting operations against armed gangs in the region. There have been a

    number of incidents, including kidnapping, shootings attempted invasion of oil industryfacilities, piracy and sabotage.

    A number of EPCL ex-pats and family members were kidnapped in a raid on theaccommodation facilities but subsequently released unharmed. Security at the site, and intransit to/from the site has tightened considerably since that event.

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    Exposure Comments

    Boilers and FiredHeaters

    The major fired heaters are the crackingfurnaces in the ethylene plant plus boilers.

    The major risk associated with equipment ofthis type is tube rupture which will generallycause limited damage.

    However in extreme situations explosions canoccur causing total destruction.

    A number of tubes have leaked and havebeen sealed off; there do not appear to havebeen any serious incidents associated withtube rupture.

    Rotating Equipment There are a large number of rotating equipmentitems, the key items being:

    HP compressors, particularly associatedwith the ethylene plant.

    Extruders associated with the two polymerplants.

    Gas turbines.

    There is a wide range of incidents which canlead to damage of rotating equipment leadingto varying levels of damage. Under mostcircumstances, damage will be limited to therotating elements of the machine but, inextreme cases, total destruction can occur.

    Transformers There are a number of large transformers onthe site Many transformers have fire wallsbetween adjacent units but fixed fire protectionis not installed.

    A fire involving a transformer is unlikely tospread to adjacent equipment, however, in theunlikely event of a transformer explosion, firewalls could fail resulting in additional damageto nearby units.

    Others Catalysts In some situations, catalyst life can bereduced or destroyed as a result of processupsets or damage caused by fire or other

    perils.

    3.16. Construction

    Whilst there is currently limited construction work at the site, there has been considerableactivity as part of the TAMs which have now been completed. There have also beenrelatively modest capital projects such as the VC5 project to provide flexibility in thefeedstock.

    Future TAMs and projects could result in construction type hazards such as crane collapse,excavation collapse, etc.

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    4. Loss Estimates

    4.1. Definitions and Loss Scenarios

    There are numerous definitions for defining levels of damage. Probable, Maximum Loss(PML), Estimated Maximum Loss (EML), Maximum Amount Subject (MAS) are amongst the

    terms in common usage. However, they are defined in different ways by differentorganizations. Definitions used in calculation of EML by Charles Taylor technical are givenbelow:

    Probable Maximum Loss (PML) The loss that could occur if the installed process safetysystems and fire protection systems operated as intended once the incident wasidentified. Such events would be typical process plant fires and explosions.

    Estimated Maximum Loss (EML) The loss that could occur if process safety systemsand fixed fire protection systems were unable to function as a result of the incident.Such events would be the rare but highly destructive events that can occur in processfacilities, such as detonations, Vapour Cloud Explosions (VCE) and High PressureVessel Ruptures. HPVR.

    Maximum Amount Subject (MAS) A catastrophic loss which could result in majordamage, or total destruction of a site. Such an event would overwhelm the processsafety systems and fixed fire protection systems. Such events would be natural perils,

    such as a major earthquake or extremely rare events such as aircraft impact.

    In general, only the EML event has been calculated, as this is of the greatest significance tounderwriters.

    4.2. Property Damage

    The following replacement values have recently been estimated by AVC and are used tocalculate the size of loss below.

    Unit US$

    Ethylene Cracker 284,800,000

    Polyethylene 181,700,000

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    Unit US$

    Flare Area 9,400,000

    Effluent Treatment (Including Incinerator) 16,800,000

    Administration and General Excluded

    Refinery Tank Farm 3,700,000

    Total 868,000,000

    The largest potential loss at the site is considered to be a vapour cloud explosion (VCE), thelargest inventories of liquefied gas in the process area are:

    Olefin PlantPolyethylene

    Plant

    PropyleneRefrigeration

    Drum

    C2SplitterColumn

    C2Splitter

    Reboiler

    C2

    SplitterRefluxDrum

    C3Splitter

    C3Splitter

    Reboiler

    C3

    SplitterRefluxDrum

    CyclohexaneCircuit

    Tag No. D-44 C-6 E-59 D-32 C-8A/B E-76 D-35

    Contents Propylene Ethylene/

    Ethane

    Ethylene/

    Ethane

    Ethylene/

    Ethane

    Propylene/

    Propane

    Propylene/

    Propane

    Propylene/

    Propane

    Cyclohexane/Et

    hylene

    Pressure

    Kg/cm2

    1.3 24.8 27.8 23.8 19.3 18.1 18.1 110-140

    TemperatureoC

    -27 -22/2 -1 23 48 41 41 310

    Diameter M 6.0 4.6 2.914 4.1 4.65 2.49 3.4

    Length T/T m 17.5 61.65 12 16.2 104.4 4.88 13.45

    Percent Full 50% - 90% 50% - 90% 65%

    Volume M3 247 144 72 107 180 22 122

    Mass Kg 151,905 79,200 39,600 60,956 104,400 12,540 75,030 110,000

    Flash Fraction 0.12 0.53 0.85 1.00 0.64 0.61 0.57 1.00

    Mass of Cloud 18,229 41,976 33,660 60956 66,816 7,649 42,767 55,000

    Modelled as: Propylene Ethane Ethane Ethylene Propane Propane Propylene Cyclohexane

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    80% Damage 40% Damage 5% Damage Total

    Overpressure radius, M 125 283 448

    Static Loss, US$ Million 29.46 238.68 4.89 273.03

    Drift Loss US$, Million 76.07 231.23 3.30 310.60

    After making the following allowances, the loss estimates are given below:

    Fire following the initial explosion 10%

    Damage outside the plot areas 10%

    Debris removal 10 %

    Fire Fighting 1%

    Inflation 9% (based on 3 years at 3% per annum the loss occurring on the last day of

    the policy year, plus a two year rebuilding period).

    The loss is estimated at approximately: US$ 435 million.

    Note that underwriters exposure might be reduced as some of the factors included in thecalculation (e.g. debris removal and fire fighting expenses) have been excluded from thevaluation.

    Damage contours are shown below:

    Key

    1 Polyethylene Warehouse

    2 Polyethylene Plant

    3 Butene-1

    4 Olefins

    5 Cracking Furnaces

    6 Compressed Air/Air Separation

    7 Polypropylene Warehouse

    8 Polypropylene Plant

    9 Power Plant

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    4.4. Machinery Breakdown

    The largest machine at the site is understood to be the Olefin Plant cracked gas compressor.The replacement value for this unit was not obtained but by comparison with similar sizedplants, a replacement value US$ 17 million in 2006. The well known Nelson-Farr cost indexshows an increase of approximately 20% between 2006 and February 2009. A currentreplacement value of US$ 22 million has been assumed

    Whilst total destruction of a machine is rare, it may occur and two scenarios are postulated:

    US$ Million

    Cost of Machine 22

    Damage to Rotating Elements

    (50% loss of machine value and 20% cost to strip the machine, replace the

    rotor and rebuild the machine) 15.4

    Synthesis Gas Compressor 12.6

    Addi tional Costs

    Inflation for 21 months at 5% per annum (incident on last day of policy year

    and 9 month replacement) 3.6

    Total 16.2

    Destruction of Machine

    (100% loss of machine value and 20% cost to strip the machine, replace the

    rotor and rebuild the machine) 26.4

    Addi tional Costs

    Inflation for 30 months (incident on last day of policy year and 18 month

    replacement) 6.3

    Total 32.7

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    2. Total destruction of the machine.

    The worst case scenario would be total destruction of the compressor with areplacement time in the range 12 to 18 months. The loss would therefore be:

    US$ 124.5 million

    4.6. Summary of Loss Estimates

    Scenario

    PropertyDamage

    (US$million)

    BusinessInterruption

    (US$million)

    Combined(US$ million)

    Property Damage Vapour cloud explosion in the olefinplant following a release from the C2splitter reflux drum

    435 166 601

    Machinery Breakdown Damage to the rotating elements ofthe olefin plant cracked gascompressor

    16.2 13.8 30.0

    Complete destruction of the olefinplant cracked gas compressor

    32.7 124.5 157.2

    Note that underwriters exposure will be limited to US$ 83 million (the policy limit with a 12 month indemnity period)for business interruption losses

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    5. Description of Installation

    5.1. Location

    The Eleme Petrochemicals Company Limited (EPCL) production facility is locatedapproximately 15 km to the East of the centre of Port Harcourt.

    The site is elevated 15m to 18m above the level of the Bonny River, which runs 5km fromthe site, and there is no history of flooding in the area.

    5.1.1. Meteorological Information

    Brief details of the meteorological conditions, when known are given below

    Topology The area is flat and no terracing is necessary.

    Lightning There are around 140 lightning days per year and lightning strikes have affected the site.

    Temperature Maximum temperatures are approximately 32C to 33C, with minimum temperatures ofapproximately 22C to 20C.

    Humidity Humidity is typically in the region of 90%.

    Rain Rainfall is approximately 3,000 mm per year, with the rainy season lasting from March to November.

    Wind and Storm Prevailing wind from the Northeast in the dry season and Southwest in the wet season.

    5.1.2. New Projects

    There are no new projects anticipated in the immediate future. However, in the longer term,it is anticipated that additional production facilities will be added in line with the originaldevelopment schedule when the facilities were first constructed. These include an increasein the capacity of the ethylene plant and additional downstream units, possibly:

    Ammonia

    Chlor Alkali

    Ethylene Glycol

    VCM

    The largest recent project was a modification to the plant to allow the cracking of Virgin C5

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    TAM1 2006 September 2006

    TAM2A - May 2008 (26 days), the timing was adjusted to fit a window of opportunitycaused by the failure of the Olefin Plant cold box.

    TAM2B - November 2008 (10 days), the timing was adjusted to coincide with ashutdown caused by interruptions of the NGL feedstock to the plant. Whilst a fewactivities are outstanding these are process rather than safety related.

    Whilst the plants now appear in overall good condition, there are still some poor operational

    features, including the operation of flare systems in manual mode and the running oftemporary connections in the polymer plants.

    5.2. Production Facil ities

    EPCL operate a modern petrochemical complex producing ethylene for the manufacture of

    Polyethylene plant notetemporary c onnections

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    A simple block diagram is given below:

    5.2.1. Process Units

    Brief details of the production units are given in the table below.

    Designation CapacityTonnes/Year

    Licensor Contractor Year Comments

    Olefins Plant 300.000 Kellogg"Millisecond"technology

    ChiyodaCorporation

    1995 Two of the cracking furnaces(including the one converted forVirgin C5 operation) have beenupgraded with MERT tubes whichincrease cracking efficiency andincrease the timing betweenshutdowns for decoking.

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    Designation CapacityTonnes/Year Licensor Contractor Year Comments

    There are 2 extruders each capableof 100% of production. 1 unit isoperational, the other requiresoverhaul following a failure at somepoint in the past. An overhaul isplanned for some point in the future.

    Polyethylene 270,000 Nova (Du-Pont)

    Sclairtechtechnology

    Kobe Steel 1995 This is a medium pressure unit,

    operating at approx 145 bar g.270oC. Twin extruders are installed

    Currently operating at approx. 60%capacity

    There are 2 extruders, each sizedfor approximately 75% of capacity,both are operational.

    Butene-1 22,000 Institut Franyaisdu Petrole (IFP)

    Alphabutoltechnology

    Kobe Steel 1995

    Utilities andOffsites

    - ChiyodaCorporation

    1995

    Infrastructure - Spie Batignolles 1995

    Current production figures for the polyethylene and polypropylene plants which consume allolefins from the olefin plant are shown below:

    Polyethylene Production

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    Polypropylene Production

    5.2.2. Process Hazards

    The main process hazards are associated with a flammable gas release or loss ofcontainment of significant volumes of liquid hydrocarbons. Many of the processing stepsinvolve handling of highly flammable and explosive gases at elevated temperatures andpressures. Transfer of gases and liquids requires the use of rotating machinery, often ofhigh power, which is subject to mechanical breakdown and failure.

    Most materials in the process are light, flammable hydrocarbons (both gaseous andliquid). A potential exists for flash fires, jet fires and, in some areas of the plant, liquidpool fires.

    There are a number of spheres and other vessels with the potential for a Boiling LiquidExpanding Vapour Explosion (BLEVE).

    Sufficient quantities of volatile liquid hydrocarbons (predominantly ethane, ethylene andpropylene) are present to form a vapour cloud explosion (VCE) in the unlikely event of alarge-scale loss of containment. In addition, there are significant quantities ofcyclohexane used as a diluent at high temperature and pressure in the polyethyleneplant.

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    Refrigerated storage tanks can suffer rollover as a result of thermal layering with a

    warmer (less dense) layer below one that is colder (more dense). These layers cansuddenly rotate or rollover with rapid vaporization of the warmer layer.

    High temperature hot oil systems are employed for process heating in the Polyethyleneplant.

    5.2.3. Layout

    The site is located on level ground totalling 440 ha and is bordered on the south and west by

    the Eleme-Okrika road.

    Brief details of the layout are given in the table below.

    Details Comments

    General The existing process units are located to thesouth of the site.

    There is plenty of space for future expansionand the new accommodation facilitiesconstructed at the site are remote from

    operational and storage areas.

    The Natural Gas Liquids (NGL) pipeline feedingthe site terminates at a custody transfer point ina Nigerian Agip Operating Company (NAOG)terminal at the plant north west corner of the site.

    The process and utilities are arranged in 2 rowswest to east in the following order:

    Row 1 (northerly row)

    Polypropylene warehouse.

    Polypropylene production.

    Power plant.

    Cooling Water Systems, and WaterTreatment.

    Row 2 (southerly row).

    Polyethylene warehouse.

    Polyethylene production.

    Olefin Unit.

    Vacant plot.

    Air separation and compressed air utilities.

    These facilities are on individual plotsapproximately 150m by 250m, with separationby road, approximately 12 m wide.

    Much of the area is open, particularly aroundthe main administration building. This will limitthe hazard faced by employees in the buildingin the event of a major explosion. Spacingbetween the various process, utility andstorage facilities is also good, limiting thepotential for domino effects from one areaaffecting adjacent areas. This is, in part, dueto anticipated future expansion at the site,which has not so far taken place.

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    Olefin Plant Cold Section

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    Details Comments

    Piperacks The level of fireproofing on piperacks isvariable between process units.

    Generally pumps are not located under orpartially under piperacks. This will greatly minimise the potential for the

    fin fans to affect the extent of the fire.

    Within the olefin plant, concrete around someof the minor steelwork supports was damaged,exposing the holding down bolts.

    Whilst this does not appear serious, repairsshould be instituted.

    Within the polyethylene plant fin fan coolerswere not fireproofed to the full load bearingheight.

    The air flow from the fin fans will exacerbateflames from a pool fire. The provision offireproofing almost to the top of the fin fancooler will minimise the extent of damagecaused by a pool fire under the fin fan.

    Within the olefin plant drainage points are If the ground were sloped towards these

    TEAL Preparation Area in thePolyethylene Plant

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    Details Comments

    Compressor Houses Within the olefins plant, there are two separatecompressor houses. Both refrigerationcompressors are located within one buildingwith a separate structure for the cracked gascompressor.

    The main compressor houses are roofed and

    walled around three sides at the upper level.The remaining side is left open to allow accessfor maintenance.

    The structures are open on all 4 sides atground level.

    Within the olefin plant, the cracked gas andrefrigeration compressors are in separatestructures.

    This will allow natural ventilation and prevent

    the build up of high levels of gas in the eventof a release.

    Lube/seal systems are located to the side ofthe compressor, close to the plant.

    The close location of the lube/seal system tothe compressor could result in damage in theevent of a lube seal fire.

    Fired Heaters The main fired heaters are the crackingfurnaces and boilers are located at theSouthern end of the olefin unit.

    The location of all the fired heaters in onelocation minimises the likelihood that a gasleak will find a source of ignition.

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    5.3. Control and Process Safety Systems

    5.3.1. Basis

    Brief details are given below:

    Details Comments

    Configuration: Each plant has a control systemwith separate hard wired ESD

    (Emergency Shut Down) system.

    Type: DCS (Distributed Control Systems)are installed in all units.

    The original DCS systems installedwhen the plant was firstcommissioned are now becomingdated and a programme of updatingis underway. So far thePolypropylene plant and the offsitessystems DCS systems have beenreplaced.

    Neither the existing or new plants

    have alarm management functions

    A number of companies have

    experienced problems, with alarmflood, during major incident. Thisresults in literally hundreds ofalarms being activated within a veryshort space of time. When thishappens, the shear volume ofalarms makes it difficult foroperators to follow the exactsequence of events. Alarmmanagement systems assist byfiltering out the less importantalarms

    5.3.2. Control Room Design

    Brief details are given below:

    Details Comments

    Location: Each of the process units has anindependent control room; inaddition there are control rooms for

    the power station and the storagearea.

    Construction: Process control rooms are blastresistant structures but appearunpressurised. Whilst automaticdoor closers were originally fitted,these have in some cases been

    All the process control rooms hadthe doors in the open position whichwould negate the blast resistance ofthe structure.

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    5.3.3. Emergency Shutdown Systems

    Brief details are given below:

    Details Comments

    Type: All units have proper emergencycontrol systems with critical safetyrelated systems fully segregatedfrom the control systems. Theseare hard-wired systems and these

    are not dependent upon computersoftware. In some cases, these aretwo out of three (2-O-O-3) votingsystems.

    The polymerisation reactions inparticular are exothermic, and havereaction inhibition systems, whichinject chemicals into the reactors tokill the reaction immediatelystopping reaction heat generation.

    5.3.4. Remote Isolation, Depressur isation and Blowdown

    There are relatively few Remotely Operated Valves (ROVs) installed in the Olefins unit.ROVs are frequently installed in locations, such as pump suctions to prevent the contents ofupstream vessels (such as drums and columns) being released to atmosphere in the eventof a pump seal failure. This issue has been highlighted in previous survey reports and EPCLhave identified 4 locations where ROVs are required. In 2 cases, they have now been

    installed.

    An ROV is installed on the feed drum in the polypropylene plant but the cabling is notfireproofed.

    ROVs are installed on the spheres and ethylene tank.

    5.3.5. Pressure Relief Systems

    Brief details are given below:

    Details Comments

    Configuration: With some exceptions singlepressure relief valves have been

    It is difficult to test relief valveswhen the plant is operating when

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    5.3.6. Combust ion Safeguards

    Boilers, furnaces and direct-fired heaters have fuel gas management systems.

    Fuel gas isolation consists of a double block and bleed system.

    5.3.7. Shaft Sealing

    Many of the pumps at the site handle liquefied gases and are fitted with double mechanicalseals and seal failure protection.

    5.4. Feedstock Supply and Product Transfer

    5.4.1. Road

    The main products (polyethylene and polypropylene) are solids and packed in bags ontopallets and are exported by road.

    There are occasional road exports of liquefied gases from the site by a road tanker. Loading

    takes place in the offsite area by armoured hoses.

    A new installation for the import of propylene rich feed from Warri has been installed. This isa basic system with discharge via armoured hoses. A simple earthing system is installed.So far, this has only operated intermittently but in future, it is intended to import 2-3,000tonnes per month and is shown below:

    30

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    Product From/To Length Comments

    Natural Gas Liquids(NGLs)

    Obaifu-Obrikom gasseparation plant.

    85 km The NGL and fuel gas line follow a commonrouting.

    Fuel Gas Obaifu-Obrikom gasseparation plant.

    85 km The NGL and fuel gas line follow a commonrouting.

    Fuel gas from this line would be required forstart-up but once continuous operation isunderway, fuel gas for the site can be taken

    from the cracking furnace overheads.

    Propylene Rich Feed Port HarcourtRefinery.

    6 km Currently out of use until the Port Harcourtrefinery FCC is returned to service.

    Virgin C5+ Port HarcourtRefinery

    6 km

    Cracked C5+ Port HarcourtRefinery

    6 km

    5.5. Storage Facili tiesThe site contains atmospheric, pressurised and refrigerated storage.

    5.5.1. Atmospheric Storage

    Brief details of atmospheric storage are given in the table below.

    No.Installed Stored Material Capacity (M3) Type of Roof

    2 Virgin C5+, 4,630 Cone

    2 Cracked C5+, 1,671 Floating

    1 Cyclohexane 2,000 Cone

    1 Ocene-1 2,000 Cone

    2 Gas Oil 2,050 Cone

    Further details are given below:

    Details Comments

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    Details Comments

    Fire Protection All the tanks are fitted with semi-fixed foam systems and waterdeluge.

    Drains Roof drains on the floating rooftanks are normally left open.

    This will avoid a build-up ofrainwater on the tank roof whichcould cause the roof to sink.However any leakage from the roofdrain line could lead to the

    discharge of the tank contents intothe diked area.

    The dike drains are also left open inthe rainy period.

    This will avoid situations wherealmost empty tanks will float if thereis a serious build up of rain water inthe dike. However, it does raise thepossibility that any spillage ofhydrocarbons will not be contained,perhaps leading to runninghydrocarbon fires along the drainssystem to the effluent treatment

    plant. Such fires could lead toignition of nearby vegetation, thishas happened in other locations.

    5.5.2. Pressurised Storage

    Brief details of pressurised storage are given in the table below.

    No.Installed Stored Material

    Capacity(M

    3) Comments

    3 NGLs 3,809 These tanks operate -5oC and are thermallyinsulated. The insulation appeared in goodcondition.

    2 VC5 2,760 These were previously polypropylene tankssimilar to those described below. They wereconverted to operate at -5

    oC and have been

    thermally insulated

    2 Propylene feed (from Port HarcourtRefinery).

    2,760

    2 Butene (Intermediate Product).

    3 Purified Propylene. 2,239

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    Further details are given below:

    Details Comments

    Diking The tanks are located in slopedconcrete dikes with. The masticused to seal the expansion gaps insome dikes has largely perishedand, in its current condition, the dikemay leak.

    The dike however would allow liquidspillages to be contained under thesphere and a large spill, withsubsequent ignition could result in aBLEVE.

    Pumps Pumps are located remotely fromthe spheres.

    Instrumentation The tanks were not originallyequipped with independent highlevel alarms.

    This could allow overfilling, if thelevel gauging system failed.

    Liquefied Gas Storage

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    33

    Details Comments

    Motor Operated Valves ROVs, sample points etc. locatedon the outside of the dike wall,penetrations through the dike wallare generally well sealed but thereare exceptions.

    Fire Protection All the spheres are equipped withdeluge water sprays, operable from

    two locations.

    This should allow access to a valve

    under all wind conditions.

    Sphere legs are fireproofed.

    5.5.3. Refrigerated Storage

    Dikes around LiquefiedStorage Spheres

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    Brief details are given below:

    Details Comments

    Construction Double wall tanks with a perlite filledannulus, constructed to API 620.

    There is a nitrogen purge throughthe annulus.

    There is reported to be someleakage of ethylene through theinner skin of the tank.

    Diking The tank is located in a sloped

    concrete wall dike, with drainsleading to an impounding basin.

    The mastic used to seal the

    expansion gaps in the dikes haslargely perished and, in its currentcondition, the dike may leak.

    Pumps Pumps are located remotely fromthe storage tank.

    Instrumentation The tanks were not originallyequipped with independent highlevel alarms.

    This could allow overfilling, if thelevel gauging system failed.

    Temperature is controlled via single

    Boil Off Gas (BOG) compressor,which returns ethylene gas to theolefin unit for re-liquefaction. Whenthe ethylene plant is shut downtemperature is maintained byventing gas to the flare.

    An unusual feature of the tank is the

    fact that the flare vent control valvefails closed and in the event of apower failure or other interruption tothe instrument air supply anoperator needs to climb the tankand manually open the bypass.

    Fire Protection The tank itself is fitted with a waterdeluge system around itscircumference.

    Medium expansion foam and waterdeluge systems are installed tocover the dike area.

    At the time of the previous survey, the bellows on the fill/empty lines for the ethylene tankwere distorted and a piping support was missing. Despite reports that the situation had beencorrected, it was no different during the current survey.

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    Piping Support with RodHanger Missing

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    5.5.4. Warehousing

    The main products from the site are solids, with separate warehouses:

    Polypropylene - 19,000m2warehouse

    Polyethylene - 42,000m2warehouse.

    Both warehouses are sprinklered.

    5.6. UtilitiesThe site is designed to be self sufficient in utilities, further details are given in the sectionsbelow.

    5 6 1 Water

    Bulk Polymer Storage Silos

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    Details Comments

    There is also a demineralisation unit to removesediment and ferric ions, plus 2 activatedcarbon filters for potable water.

    Cooling Water: A vent is installed in the cooling water returnline. This is located on the return line itselfrather than on the individual pipes to each cell.

    Vents are often installed on the return lines ofcooling water systems to avoid the entry offlammable gases (from heat exchanger leaks)from entering the cooling tower where theymight ignite. The efficiency of the

    arrangement installed at the site is not clear,in the case of significant leaks; it may allowgas to be swept past the vent into the coolingtowers.

    The original cooling tower internals have nowbeen replaced with polypropylene packing.

    Cooling tower fans are reported to haveexplosion proof motors.

    This will reduce the likelihood of flammablegas igniting.

    The gearboxes and motors have vibration

    alarms.

    No. of Cells There are 2 cooling towers, each with 5 cells. All cells are now operational and repairs togearboxes and fans, reported defective inprevious surveys have now been repaired.

    Packing in the cells is in relatively poorcondition. Some has been displaced into thecooling water return line and blocked tubes inmany of the exchangers.

    No. Normally in use 8 cells should be adequate for full operation but

    previously all 10 have been in use.

    No. of Pumps 5 electrically driven pumps, each of9,000m

    3/hour are installed.

    .All are now operational.

    No. Normally in use The system is designed for 3 of the 5 pumps tonormally be in use. However currently 4 of the5 pumps are running to a degree of leakage inthe cooling water system.

    Boiler Feed Water Treatment consists of:

    3 Activated carbon filters installed forcondensate treatment.

    2 Demineralisation beds.

    3 mixed bed polishers.

    In addition to provision of fresh Boiler Feed

    The Boiler Feed Water quality has previouslybeen poor on occasions and this may have

    contributed to problems with the boiler tubes.Improved chemical dosing and monitoring arenow in place.

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    5.6.3. Steam

    Brief details are given below.

    Details Comments

    No. of Boilers All steam raising takes place on the olefinsplant using the following:

    3 Boilers each generating 120 tonnes/hour

    at 48 kg/cm2. 6 Cracking furnaces generating steam at

    48 kg/cm2 and 109 kg/cm2.

    The boilers have been refurbished as part ofTAM 1.

    OperatingConfiguration

    Steam is provided by the cracking furnaces andthe boilers.

    At low cracking rates all three boilers wererequired to meet steam demand. As demandincreases, more heat from the crackingfurnaces is recoverable as steam and 2 boilers

    will be adequate to meet demand. Howevernormal practice is to keep all 3 boilers inoperation at reduced flow rates to allow for thepossibility of a boiler trip.

    During periods when boilers are taken out ofservice for statutory inspection, there will beno spare steam capacity.

    Distribution Steam is provided at 4 pressure levels:

    Ultra high pressure (109 kg/cm2).

    High Pressure (48 kg/cm2).

    Medium Pressure (11 kg/cm2).

    Low Pressure (5 kg/cm2).

    5.6.4. Electricity

    Brief details are given below.

    Details Comments

    No. of ExternalFeeders

    There is a single feeder, owned by NationalElectrical Power Authority (NEPA) to connectEPCL to the Port Harcourt Refinery. Howeverthere have been problems of reliability and it isnot now used.

    Current status of this connect was notdetermined but the main power supply is fromEPCLs gas turbines.

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    Details Comments

    The gas turbines are located within a largesingle building. The number of flanges on thefuel gas lines is limited.

    This will minimise the potential for a gas leakfrom a flange to generate an explosion withinthe building.

    OperatingConfiguration

    Maximum demand is 35 MW, with current sitedemand at 19 MW.

    This is met by running 2 generators atapproximately 50% capacity.

    This will allow one machine to take over fullload in the event that the other machine trips.

    Distribution Power is generated at 11 KV in the maingenerators, then stepped up to 33 KV.

    There are also 3.3 KV and 415 V distributionsystems.

    Distribution is via a secondary selectivesystem.

    There is a load shedding system covering thesite.

    High voltage switchgear is SF6 type, LVswitchgear is vacuum type.

    Some simple, low voltage, extensions to thesystem have been made to assist withmaintenance and routine work activities.

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    Details Comments

    Equipment Protection Fire walls are installed betweentransformers.

    Carbon dioxide systems are installed onthe gas turbine generators.

    Emergency Generation Emergency power is provided by 4 dieselgenerators, each with a capacity of 2 MW.

    These have black start capability and feed the3.3 KV system.

    The emergency generator provides power for:

    Control panel, lube system pumps and finfan coolers for a gas turbine

    An instrument air compressor

    Hot flush system for the polyethylene plant

    Plus other critical duties.

    5.6.5. Air

    Brief details are given below.

    Details Comments

    No. of Compressors There are 4 electrically driven centrifugal, oilfree, air compressors.

    A new unit is in operation to replace one of theoriginal units which has been cannibalised forspares.

    Capacity The machines are each rated at 6,800Nm3/hour at 8 kg/cm2g.

    Operating Configuration 3 Units are required for full operation

    The air compressors supply plant andinstrument air and also provide a feed to thenitrogen generation unit.

    When all process units are in full production,there will be no standby machine.

    Ai r Treatment: Air driers are installed for the instrument airsystem.

    Back-up Facilities Air receivers provide buffer 15 30 minutescapacity for the instrument air supply.

    This represents a satisfactory level of back-up.

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    Details Comments

    A new nitrogen unit has been ordered fromthe Suzhou Oxygen Plant Company (SOPC),China. Some equipment items for the unithave been purchased directly by EPCL ratherthan sourced through SOPC.

    Whilst this may not be a company widelyknown in the West, they are reported to havebuilt over 600 units worldwide. Further detailscan be found at:

    http://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91b

    Capacity Capacity is 3,400 Nm3/hour of gaseousnitrogen and 390 Nm

    3/hour of liquid nitrogen

    Storage There are 3 liquid nitrogen storage tanks eachwith a capacity of 184 m

    3.

    5.6.7. Flare

    The plant has three main flare stacks and a burn pit, details of the flare stacks are given

    below: FS1 (76.2m high) covering the olefins plant and utilities (note that there do not

    appear to be separate cold and wet sections to the flare which could result in water richstreams in contact with cold streams freezing and causing blockage in the flare lines)

    FS2 (76.2m high) covering the polypropylene and polyethylene plants

    FS3 (25 m high) covering the ethylene storage tank

    Flare drums are reported to be instrumented with automatic pump out on high level togetherwith steam coils for evaporation of the drum contents.

    The flares and burn pit are located to the northeast of the site with limited potential fordamage to the process or utility systems.

    5.6.8. Effluent Treatment

    The system has segregation between the storm water and oily-water drainage systems with

    all oily drainage directed through to a proper drainage system in the water treatment area.

    The storm water system is largely open and underground sections have gas seals to preventthe movement of flammable gases through the drain system. The seals are vented toatmosphere with flame arrestors installed. Whilst the main drainage channels are largelyclear of vegetation in several locations small drains feed into the open drains and these are

    43

    http://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91bhttp://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91bhttp://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91bhttp://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91bhttp://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91bhttp://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91bhttp://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91bhttp://en.suyang.com.cn/newEbiz1/EbizPortalFG/portal/html/gysy.html?GeneralContentShow_DocID=c373e9087b27eebd8f6bc4f684d8e91b
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    Manufacturer Comments

    Olefin Plant CrackedGas Compressor

    Elliot/Mitsubishi The unit is currently operating with the sparerotor installed. An overhaul took place as partof TAM2.

    Olefin Plant Propyleneand EthyleneRefrigerationCompressors

    Elliot/Mitsubishi The units are currently operating with thespare rotor installed. . An overhaul tookplace as part of TAM2..

    Power Plant GasTurbine Generators

    GE (Frame 6) The units are understood to be in goodcondition with 2 units having hot gas pathinspections in 2004. One unit wasoverhauled in TAM2 and then, I unit will beoverhauled each year for the next three years.

    Polypropylene Plant Extruders

    There are 2 extruders each capable of 100%of production. 1 unit is operational, the otherrequires overhaul following a failure at somepoint in the past.

    Polyethylene Plant -

    Extruders

    There are 2 extruders, each sized for

    approximately 75% of capacity. 1 is currentlyoperational and the other is being overhauled.

    Further details of equipment maintenance is given in section 6.3.

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    6. Administration

    6.1. Organisation

    Since the takeover of EPCL by Indorama, many of the original NNPC staff have left. Thesenior management now consists of Indian ex-pats. The staff at the time of the takeover byIndorama was around 1,000, currently, there are approx 600 local staff and 170 expats.The former NNPC staff who have left the site work in other NNPC business units and therewere no significant redundancies that might have triggered resentment against the companymanagement.

    EPCL intend to recruit local staff, as far as possible and training programmes are beingestablished, the last ex-pat recruit arrived at the site around a year ago.

    The managing director of EPCL has three main reportees:

    Finance and Administration Commercial

    Site

    The site head has reporting to him the key components of the site operations:

    Olefins

    Polymers

    Offsites/Utilities

    Maintenance

    Technical Service

    Health Safety and Environment (HSE)

    The HSE function, in line with good practice, has direct reporting to the site manager.

    The previous EPCL management, under NNPC had limited financial authority and evenrelatively minor requests for expenditure had to be approved at a corporate or evenGovernment level. The change of ownership has removed the previous financial restrictions,allowing much better access for funds for spare parts and other uses. This is demonstratedby the extent of work performed in the various TAMs since Indorama bought the site and

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    Details Comments

    Polymers (subdivided into Polypropyleneand Polyethylene & Butene)

    Power Utility and Offsites.

    Each unit has a plant manager and productionmanager (working days), plus shift teams asfollows:

    OlefinPlant

    Polypropylene

    Polypropylene/

    Butene1

    Power

    Utilities

    Offsites

    ShiftEngineer

    21 1 1 1 1

    PanelOperators

    4 2 3 1 1 1

    FieldOperators

    8 5 8 1 4 22

    1 Shift engineer and assistant, the olefinsplant is split into hot and cold sections.

    2 Plus one field operator at NNPC

    Outside day working hours, there is a shiftmanager in charge of the site.

    This will ensure a good level ofcommunication and control in the event of amajor event. In the absence of a nominatedindividual, confusion can arise over who takesinitial charge of an emergency and who hasauthority to shut down the plant.

    The site has four shift teams working a threeshift system.

    8 hour as apposed to 12 hour shifts .willreduce the level of fatigue faced by shiftpersonnel, particularly during hot weather.

    Most operators are understood to be in the age

    range of 20- 50.

    There will not therefore be a sudden large

    reduction in the overall level of operatingexperience in the near future.

    Warehouse activities (bagging, fork lift truckdriving, etc.) will be largely performed bycontractors under the supervision of EPCL staff.

    This is a common procedure in polymer andother plants with large solids warehouses.

    Budget Budgetary pressures were apparent when

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    Details Comments

    The recruitment process includes a written test.

    A number of experienced Nigerian operators,mostly with ammonia plant experience, havealso been recruited.

    Trainees will undergo a mixture of classroomand on the job training lasting approx. 18months. Progress is measured by a mixture ofcontinuous assessment and interviews rather

    than by written examination

    This will ensure that all recruits have anadequate command of the English language.

    Operators will initially be trained for a singleoperational role on one unit but as they gainexperience will train in a number of positions.

    The recruits from 2006 are now fully trainedfield operators and are now learning paneloperation.

    A process simulator is available but has notbeen fully configured.

    Experience Most, but not all, operators are graduates.

    For more senior positions, including paneloperators and above, EPCL are appointingexperienced process operators.

    These are ex-pats, NNPC secondees orNigerian staff with experience in the processindustries. Some of these will be recruits fromNNPC but there have also been a number ofrecruits from NAFCON (fertilizer manufacturer).

    There are a number of Romanian nationals whohave senior operating positions and haveworked at the site for a number of years.

    Many of the NNPC secondees are understoodto have been at the site since start up.

    Documentation:

    Standard OperatingProcedures

    Operating procedures have been partiallyrevised and updated since Indorama took overthe site.

    However, there are still a number of areas forimprovement.

    Completeness Quality of procedures varies; those in the Olefinplant were limited with little informationavailable in the folder examined with pages inthe wrong order and some pages missing.

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    Details Comments

    Emergency ResponseProcedures

    Quality of emergency procedures is variablebetween units but, in most cases, there are noshort form emergency procedures. Those inthe Polyethylene plant were vague and not wellformatted. Instructions were not in a step bystep format.

    Due to the defects defined below thepreparation of short form emergencyshutdown procedures is desirable and the sitemanagement are currently preparing them.

    The site management are currently reviewingthe existing emergency shutdown proceduresin the light of the comments made.

    The particular set of emergency procedures

    examined had a number of defects, whichreduce their value:

    The indexing is poor. This would increase the time needed to find theappropriate instructions.

    The instructions are relatively denselywritten.

    Well laid out instructions ease understanding,particularly during an incident.

    Actions for all personnel appear to bewritten in the same part of the documentwith no split of the activities between the

    individual field operators.

    It would be preferable for the tasks to beundertaken by each individual operator to belaid out separately to facilitate clarity of

    understanding.

    Some emergency shutdown training takesplace but this appears to be classroom based.

    Under emergency conditions operators mayreact in unexpected ways and regular fieldsimulations are often considered a helpful wayof reducing operator error. Without thisoperators may be confused as to the location ofthe critical valves and other equipment.

    Process Upsets A reporting procedure for process-upsets isbeing developed. The first stage is thecompletion of a First Information Report.

    After investigation a Facts and AnalysisReport is produced with lessons learned.

    A previous survey recorded that all alarms arerecorded on the DCS system and no problemswith alarm flooding have been reported.

    A number of companies have experiencedproblems, with alarm flood, during majorincident. This results in literally hundreds ofalarms being activated within a very shortspace of time. When this happens, the shearvolume of alarms makes it difficult for operatorsto follow the exact sequence of events. Alarm

    management systems assist by filtering out theless important alarms.

    This problem has been identified and will beaddressed as part of the DCS upgrade.

    Communications/ShiftHandover

    Shift logs are maintained by the shift engineerand panel operators The condition of the plant

    It is often considered advantageous for both theoutgoing and incoming supervisors to sign the

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    Details Comments

    Isolation Procedures:Mechanical Reliance is placed on closing of valves and

    where pipework is opened blinds are installed.The use of padlocks to ensure that valves arenot opened by mistake would be useful.

    An isolation procedure defining appropriatelevels of isolation should be established.

    Electrical Electrical isolation is achieved by racking outelectrical equipment.

    This will provide effective isolation but the useof a padlock on the isolator handle would

    represent an additional precaution againsterrors. The site management are currentlyreviewing the adequacy of the existing system.

    Instrument A trip bypass register exists and was originallyset up by NNPC.

    For short term bypasses, approval is given bythe head of the department.

    Longer term bypasses require a more seniorlevel of approval.

    There is a trip bypass register for each unit.

    Bypasses are checked regularly as part of theregular technical services reports.

    The registers in some units, particularly theolefins plant, were confusing and not easy tofollow.

    Some undesirable features were noted during site visits such as the short term discharge ofliquefied hydrocarbons in the plant when samples were being taken, the operation of flaredrums on manual control rather than automatic pumpout and temporary connections in thepolymer units.

    6.3. Maintenance

    Brief details of the maintenance function are shown below.

    Details Comments

    Organisation andStaffing Levels The Engineering department is responsiblefor maintenance activity and has 2 main

    branches:

    Central Services:

    Workshop

    Plant Maintenance:

    Olefins

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    Details Comments

    There are currently no firm plans for a furtherTAM but one is anticipated around March 2010to install a replacement cold box in the olefinplant.

    The current level of maintenance shutdownssince Indorama took over the site is muchhigher than would normally be expected andreflects a backlog of maintenance from thedays of NNPC ownership. Once a satisfactorylevel of maintenance has been achieved, thereis no need for TAMs to occur on an annual ortwice annual basis.

    Planning Currently spreadsheets are being used formaintenance planning.

    The MAXIMO Computerised MaintenanceManagement System (CMMS) will beimplemented and will initially be used on thepolypropylene plant. Currently data is beingcollected for future implementation.

    Training in soft skills is being undertaken toassist personnel to use MAXIMO correctly.

    It is reported that future TAMs will beundertaken at a maximum of 4 yearly intervals.However a further shutdown is being plannedto install a replacement cold box in the Olefinplant.

    At this stage, it is probably too early todetermine TAM frequency. This will onlybecome apparent after the unit has beenoperating in a steady state condition for sometime. Non-intrusive techniques should give ageneral indication of the condition of the plant.

    Performance EPCL have developed a system of KPIs (KeyPerformance Indicators) for the site. Theseshow a current availability of 99%

    There currently appears limited overdue

    maintenance and these tasks which areoverdue are understood to require maintenanceshut down for completion.

    Maintenance under NNPC suffered from lack offinancial resources and the current situation ismuch improved.

    Documentation Most maintenance records are in hard copyand soft copy form. The soft copy is kept onEPCLs server.

    This situation will ensure that a fire or otherincident in the records office will not destroy theentire maintenance history of the plant.

    Mechanical Vibration monitoring systems are installed onlarge rotating equipment items such as:

    Main compressors in the ethylene plant

    (Bentley Nevada 3500 series).

    Gas turbine generators.

    Instrument air compressors (4 units)

    Reactor feed pumps (3 units)

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    Details Comments

    Impact onproduction

    Impact on safety/environment

    B Equipment:

    On standby

    More than 22 kW,and

    Operating above2,800 rpm

    Fortnightly

    C Equipment:

    On standby,

    More than 22 kW,and

    Operatingbetween 1,400and 2,800 rpm

    Monthly

    D Balance ofequipment

    Whenrequired

    Vibration trips are installed on the gearbox andmotors of the cooling tower fans.

    An in house lube oil testing programme has

    being set up with regular checks on moisture,viscosity and particles. If problems aresuspected, lube oil samples will be sent forferrographic analysis.

    Dye penetrant testing was performed on therotating elements of key equipment duringTAM1. No problems were identified.

    There is some equipment balancing capabilityat the site but larger items would probably have

    to be returned to the manufacturer forbalancing.

    During TAM1, lube oil quality was found to be

    poor with significant contamination by waterand solids. This has now been rectified.

    There were initial problems with the olefin plantcompressors as a result of solids deposition onthe rotors. There were also initial problems ofhigh bearing temperatures.

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    Details Comments

    Electrical The oil in all transformers underwent aDissolved Gas Analysis (DGA) and dielectrictest at TAM1 and no problems were identified.

    Further DGA is anticipated in the future and thetransformer oil has been filtered.

    DGA may be valuable for determining the earlystages of transformer oil breakdown on largecritical transformers.

    Dielectric testing task place every 6 months.

    Annual earthing checks are undertaken.

    To date a thermographic camera has not beenused at the site.

    Thermography is increasingly used as aneconomic non invasive method of detectingfaults. This may be a useful technique for useprior to the TAM to identify equipment whichmight be in need of repair.

    There are understood to be facilities forbalancing large electric motors in the region.

    Lack of suitable facilities could lead to longperiods of downtime whilst a motor wasshipped abroad to the manufacturer.

    Some equipment is obsolete and replacement

    is taking place, including some DC machinesand invertors.

    Instrumentation Full function tests on all trip systems wereundertaken during TAM1.

    Some components, particularly solenoid valveshave required replacement.

    The previous CTt survey in 2006 reported anumber of bypasses of trips in the olefin plant.Whilst the trip bypass register was reviewedduring this survey, it was in a confused and thestate of trips was not always clear.

    There is no on line trip testing of the processtrip systems. However tests will take place if aproblem is suspected.

    Some systems are partially duplicated whichwould allow partial testing online. However,many companies are often reluctant to performon line testing to prevent an accidentalshutdown of the plant.

    The trip systems on the polymer plants areconsidered less critical as they generally havefrequent short shutdowns for cleaning andgrade changes which would allow trip testing tobe undertaken.

    It is now current practice to regularly exercisethe trip valves on the steam turbines.

    In situations where there is poor steam quality,scale can build up across the valve seatpreventing it from closing in an emergency.

    Some equipment is obsolete and replacementis taking place. For example, the fire detectionsystem in the polypropylene plant has been

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    Details Comments

    EPCL have developed technical agreementswith the licensors of the major process units:

    Kellogg (olefins)

    Nova (polyethylene)

    Basell the successor to Technimont(polypropylene)

    IFP(now Axens) - the butane-1 plant

    EPCL have appointed SK Energy of Korea