participation equals value - mti theme for 2016, participation equals value, brings into sharp focus...

PARTICIPATION EQUALS VALUE

2016 ANNUAL REPORT

Introduction . . . . . . . . . . . . . . 1

Report of the Chair –

Board of Directors . . . . . . . . . . 2

Board of Directors . . . . . . . . . . . 3

Letter from the Executive Director . . . 4

Directors & St . Louis Staff . . . . . . . 5

MTI Fellows . . . . . . . . . . . . . . 5

TAC Reports . . . . . . . . . . . . . . 6

Annual Highlights . . . . . . . . . . . 9

Member Companies &

Designated Representatives . . . . .14

Technical Advisory Councils . . . . . .16

MTI is a Go-to Resource for an

Ever-changing Workforce . . . . . .20

MTI 2015: Participation Quantified . . .22

Financial Statements . . . . . . . . .24

Membership Dues Information . . . . .27

Benefits of Membership . . . . . . . .28

MTI’s Vision . . . . . . . . . . . . . .29

MTI’s Mission . . . . . . . . . . . . .29

Delivering Value to Members

for 40 Years . . . . . . . . . . . . .29

MTI’s success depends on member participation, from engaging in discussions at TAC Meetings to monitoring forum questions.

Member representatives and affiliates form, collaborate on, and champion project teams, managing materials engineering studies

from launch to completion. Many contribute their time and expertise to a number of initiatives.

MTI’s online forum provides a hub with spokes connected to some of the industry’s leading materials experts. Members are able to log in

and seek answers to critical technical questions 24 hours per day, 7 days a week. Queries have generated operations-critical information

within minutes of being posted. There are numerous examples of forum suggestions that have saved members significant time and

money as well as helped them avoid costly mistakes, providing incalculable value.

The teamwork adds up, and the benefits that companies realize from their membership in MTI often far exceeds their yearly investment.

It’s not uncommon to hear a member claim he or she has covered the cost of dues many times over based on a single forum answer,

project, or rapid access to one of MTI’s many other unique resources. When more than 1,000 of the best materials engineering minds

in the world collaborate to solve critical problems, everyone involved wins. Participation equals greater value for your company.

MTI has been delivering measurable value to its members, since they formed their

own non-profit materials research institute in 1976. Now entering its 40th year, the

organization continues to develop and complete the fast-track projects that its members

vote to support and lead. Those projects generate valuable books, reports, and training

programs that benefit member operations and employees worldwide.

PARTICIPATION EQUALS VALUE | 1

PARTICIPATION EQUALS VALUE

highlight the value received from MTI within the member company itself. This recognition reinforces the bond between the member and MTI.

Our TAC Forum is another excellent example of how the participation of members creates value for the organization and for individual members. The ability to reach multiple experts on a wide range of technical subjects and to quickly receive trusted information is often looked upon as one of the primary member benefits. While MTI provides the structure to facilitate this information exchange, it is the participating members that create the value.

Our support of symposia such as the Managing Aging Plants Conference, our project development and our industry-focused Roundtables all rely on the contribution of our MTI experts to generate value for our members. Whether you are new to MTI or a seasoned veteran, I encourage you to be actively involved and to encourage your colleagues to do so, as well.

Thank you to all of our members for another excellent year. The value member companies receive is dependent on the willingness of our members to participate in knowledge creation and sharing. Increasing the number of individuals participating by a member company increases the value re-ceived and the return on their membership dues. In fact, I believe that the more members participate, the more value they receive in return.

Paul Whitcraft — Rolled Alloys Chair, Board of Directors

As you read through this annual report, you will see that MTI has continued on a very productive and successful path. This is due to the efforts of our members who continue, through their knowledge, energy and efforts, to develop new projects and products that create value for all of our members. It also depends

on a dedicated and knowledgeable MTI Staff, ably directed by John Aller, to facilitate meetings, manage projects and ensure that our products are delivered in a timely and useful fashion.

From the inception of the MTI organization, active participation of individual members was seen as a key component of the value that was to be created and sustained. It is the members who are faced with solving materials issues to improve safety and profitability. It is also the members that provide the solutions to these problems through shared knowledge or shared resources to fund projects. MTI is not simply a library of knowledge where members withdraw information. (Although, we have accumulated and make available a mountain of information just for this purpose.) MTI is an organization that creates information and value through the participation and contributions of individual experts.

The growth in participation in our Value Awards program is a prime example. Value Awards were established just two years ago to identify and recognize those organizations that best exemplify the implementation of MTI intellectual property into action to generate a return on investment for the member. Sharing examples of how this information is put to use benefits the entire membership. Participants receive recognition in their own right, but the awards also

REPORT OF THE CHAIR — BOARD OF DIRECTORS

2 | MATERIALS TECHNOLOGY INSTITUTE

BOARD OF DIRECTORS

Seated, Left to Right:

Michael Blakely, AmeriTAC Vice Chair Ex-Officio

Global Director of Business DevelopmentNobelCladBoulder, Colorado

Michael Anderson, AmeriTAC Chair Ex-Officio

Area Leader - Reliability & Performance ImprovementSyncrude Canada Ltd.Fort McMurray, Alberta, Canada

David BarberMaterials Engineering Discipline Technology LeaderThe Dow Chemical CompanyFreeport, Texas

Kevin GanschowMaterials EngineerChevron CorporationRichmond, California

Standing, Left to Right:

Paul Whitcraft, BOD ChairRegional Metallurgist – Eastern USRolled AlloysTemperance, Michigan

Maria Jose Landeira Oestergaard, BOD Vice Chair

Principal Engineer, Senior Materials SpecialistHaldor Topsoe A/SKgs. Lyngby, Denmark

Robert SinkoAssociate Materials EngineerEastman Chemical CompanyKingsport, Tennessee

Srini Kesavan Principal Engineer - MaterialsFMC CorporationPhiladelphia, Pennsylvania

Kelly WyroughDirector of Technical ServiceRoben Manufacturing Co., Inc.Lakewood, New Jersey

William PadenSenior Corrosion & Materials EngineerAscend Performance Materials LLCHouston, Texas

Dale HeffnerVice PresidentElectro Chemical Engineering & Manufacturing Co. Emmaus, Pennsylvania

Robert FreedPrincipal Materials ConsultantDuPont CompanyWilmington, Delaware

Not Pictured:

Paul ManningDirector, CRA Marketing and Business DevelopmentHaynes International, Inc.Kokomo, Indiana

Eileen ChantEngineering ManagerBecht Engineering Co., Inc.Liberty Corner, New Jersey

Dietlinde Jakobi, EuroTAC Chair Ex-OfficioGeneral Manager - Research & Development Services Centrifugal Casting DivisionSchmidt+Clemens GmbH+Co KGLindlar, Germany

Chang-Ching Sun, AsiaTAC Chair Ex-Officio

Market Development Director / BA Stainless Asia Pacific AreaOutokumpu, Inc.Beijing, China

The Board of Directors, elected by the Member Representatives, manages the business of MTI. The four critical functions of the Board of Directors include planning, organization, leadership, and control.


experts participate in or champion the project teams to make sure the specific needs of their organization were achieved in the deliverables of the project. These organizations got results that were funded by all of the MTI member organizations that, without MTI, they would have funded entirely on their own. They understood that Participation Equals Value.

In late 2014, I had the opportunity to make a marketing call on one of the organizations that later joined MTI in 2015. During the day I spent in their offices, I presented the Value of MTI Membership to a group of their technical and management decision makers. I made a presentation on the potential value of MTI through collaboration, leveraged projects, and networking. I then went on to explain that the potential value can only be achieved by active participation, while describing the model laid out in the paragraph above. In the meeting, we discussed the needs that were driving their interest in MTI, and I agreed to help their representative get quickly engaged with the MTI efforts that matched their company needs. Within their first year of membership, their DR is an active, effective champion of two projects that will deliver direct value to our new member. As a new member, they already understand that Participation Equals Value.

I challenge all of our members to intentionally plan on how they can maximize the value they can take back to their organizations from their participation in MTI.

John Aller Executive Director

For MTI member companies, 2015 can perhaps be described in Dickens’ immortal words from A Tale of Two Cities, as the best of times and the worst of times. Those companies using hydrocarbon feedstocks and energy have benefited from low oil prices while those organizations who produce oil

and gas have experienced a difficult year. In the midst of this dichotomy, MTI has continued to focus on delivering value to its membership.

The theme for 2016, Participation Equals Value, brings into sharp focus what factors differentiate the companies that realize high value from their MTI membership from those who receive less value. Like most worthwhile en-deavors, what one gets out of an effort is proportional to what is put into it. But with MTI, there is an additional leveraging of value that can be achieved by thoughtful, intentional participation. Let me explain.

Through my association with MTI in various roles, I have developed a keen admiration for those companies that have participated in MTI with an intentional plan to get what their organization needed from their MTI membership. One of the ways I repeatedly observed participation create value can be described as follows: The company’s plan for participation in MTI started with a clear identification of the materials-related issues in their organization that could benefit from an MTI project. These companies would then serve on or lead the Project Development Committees (PDCs) to make sure their company interests were included in the valuable project ideas that were being developed. As the potential projects were spun from the PDCs, these value-focused members would have their subject matter


LETTER FROM THE EXECUTIVE DIRECTOR

Front Row:

Emory FordAssociate Director

John AllerExecutive Director

Second Row:

Lori ElginAdministrative Assistant

Byron KeelinOperations Director

Kirk RichardsonMarketing Director

Third Row:

Paul LiuAssociate Director

Debby EhretOperations Director

Bill WatkinsAssociate Director

Heather StineAssociate Director

Fourth Row:

Randy ScheelAssociate Director

Jesse ChenAssociate Director

Not Pictured:

Patrice HoulleAssociate Director

Inset:

Lindsey SkinnerCommunications and Publications Manager

Emory Ford — 2015

Pradip Khaladkar — 2014

James M. Macki — 2011

George Elder — 2004

Warren Pollock — 2004

Robert Puyear — 2002

Sheldon Dean — 2001

William C. Fort III — 2010

W.B.A. (Sandy) Sharp — 2006

Robert A. McTamaney — 2006

Greg Kobrin — 2005

Paul Dillon — 2001

Galen Hodge — 2001

Bert Krisher — 2001


DIRECTORS & ST. LOUIS STAFF

MTI FELLOWS


TAC REPORTS

forum presentations. Members wrapped up a very productive year at AmeriTAC, approving funding for six new projects and setting the pace for 2016.

AmeriTAC Highlights in 2015:• Fivestructuredforumpresentationsprovidedatthree

AmeriTAC meetings• Three“LearningfromFailures”panels/forums• FormationofeightProjectTeams,including:

Hg in Shale Gas; High Temperature Hydrogen Attack (HTHA); Glass Lined Equipment Repair; Polymer Cap Strip Welding; Country of Origin for Tubes; Fabrication Effects on Chloride Cracking in Duplex; ASTM Supplemental Requirements for Rolled Plate Surface Finish; and Mechanical Integrity of Plant Civil Structures

• Ceramics101andEffectiveMeetingLeadingTrainingSessions

• WesternCanadaRoundtable,includingMTI projects overview, four technical presentations and a live project development survey

• RosenIntelligentPlasticSolutionsplusMaterials Science and NanoEngineering (Rice University) Tours

Numbers are a good indicator of just how successful AmeriTAC was in 2015. In February, 18 Project Teams and 5 Project Development Committees (PDCs) met at AmeriTAC 116 in Destin, Florida. The Winter Meeting also included two structured forum presentations as well as MTI’s first Learning from Failures session. A total of 87 attendees representing 40 member companies participated in the first of three AmeriTAC Meetings.

An upward trend started at AmeriTAC 117 in Calgary, Alberta, where 95 people attended the meeting and Western Canada Roundtable. Thirteen project teams and 5 PDCs met during the summer session. The meeting included a second successful Learning from Failures forum and a special Champion Experience Panel Discussion, where members discussed the value of leading MTI projects.

AmeriTAC ended the year on a high note, with 107 people participating in the Fall Meeting held in Houston, Texas. Forty eight member companies sent representatives to attend AmeriTAC 118, another high mark for the year. Meeting highlights included a Ceramics 101 Training Course, a Learning from Failures Panel Session focused on HTHA, 18 project team meetings, and two more structured

Unique Forums Add Value for AmeriTAC Participants

AmeriTAC 118 featured a tour of Rosen Intelligent Plastic Solutions.

AmeriTAC featured three panels/forums focusing on “Learning from Failures.”

EuroTAC is proof positive that increased participation equals value. MTI’s European members held their Spring Meeting at RTWH Aachen University in Germany in March 2015, after the first successful Managing Aging Plants Conference and Expo in Dusseldorf. Thirty-nine people representing 21 member companies attended the interactive session, which included nine technical presen-tations, generated two new project teams, and provided plenty of networking opportunities for attendees.

In November 2015, a record 46 people gathered for the Fall EuroTAC Meeting, hosted by member company BASF in Ludwigshafen, Germany. Dr. Bernd Glaser, Director of Materials Department at BASF, shared success stories commemorating the company’s 150-year anniversary. The two-day session also included technical presentations

from long-time industry partner DECHEMA and other guests as well as several project updates by members and MTI staff.

EuroTAC Highlights in 2015:• MTImemberpresentationsandworkshopsprovided

at first-ever Managing Aging Plants Conference & Expo in Dusseldorf

• Eighteentechnicalpresentationsprovidedattwo EuroTAC meetings

• Formationofthreeprojectteams,including HTHA; Guideline for Mechanical Failures for CPI; and Development of Supplementary Requirements-Flanges

• SpecialNonDestructiveTestingTechnicalSession• BASFandRTWHAachenUniversityTours

Participation on the Rise at EuroTAC Meetings


EuroTAC’s Fall Meeting at BASF in Ludwigshafen, Germany.

AsiaTAC continues to thrive by delivering a wide range of training and technical programs to MTI’s Asian member companies. In May 2015, MTI and the Japan Society of Corrosion Engineers (JSCE) co-sponsored a technical meeting in Tokyo. Sixty-four people participated in the second such collaboration, establishing a closer working relationship with JSCE, SCEJ (society of Chemical Engineer Japan), as well as renowned industrial and academic material experts in Japan.

MTI Executive Director John Aller and Associate Director JesseChenparticipatedinthe“InternationalSymposiumon Science, Engineering and Strategy for Risk Based Maintenance,”whichwasheldinTokyoNovember30– December 1, 2015. The meeting was sponsored by the 180th Rick-Based Asset Management Committee of the Japan Society for the Promotion of Science (JSOS) and the Waseda University. Mr. Aller presented a keynote “TheHistory,ApplicationandFutureofRBIandRBM” on behalf of MTI.

Fifty-six people participated in AsiaTAC’s 6th Annual Meeting in Shanghai, December 2015. The program began with a training session on Recent Developments in Duplex Stainless Steel. That was followed by a two-day AsiaTAC forum, which included several technical presentations and panel session discussions. Annual Meeting participants concluded another successful year by electing Chang-Ching Sun of Outokumpu as their new AsiaTAC Chair and TP Cheng of ITRI and Guangbin Rao of BASF as Vice Chairs.

AsiaTAC Highlights in 2015:• SecondJointlySponsoredMeetingwithJapan

Society of Corrosion Engineers• Eighteentechnicalpresentationsprovided

at two AsiaTAC meetings

• Formationoffourprojectteams,including:ImprovedRisk Modeling for CUI; Managing Aging Plants in Japan; Clad Materials Training Class; and Corrosion Data of the Most Commonly Used Corrosion-Resistant Nickel Alloys

• FourSpecialPanelSessionsfocusedon: • CorrosionandPreventionTechnology,

Corrosion Resistant Metals, Corrosion Testing, Corrosion Case Studies

• ProcessEquipmentFabrication,Welding, Inspection, Maintenance, Reliability, Condition Assessment, Testing and Repair

• FailureAnalysis–RootCauseofMaterial Fracture, Fatigue, Deformation, Wear, and High Temperature Failure projects

• MetalApplicationinChemicalandPetrochemicalIndustry, Development of New Metals, High Performance Metals, and Metallurgy

• RecentDevelopmentsinDuplexStainless Steels Training Seminar

Collaboration Creates New Opportunities at AsiaTAC


TAC REPORTS

AsiaTAC Chair Henry Ye accepts service award from Executive Director John Aller


2015 HIGHLIGHTS

AmeriTAC 118 (Houston, Texas) ended on a high note with the second annual Value Awards ceremony. MTI’s Value Awards recognize member organizations who have realized significant value from the successful application of knowledge gained at MTI. The awards allow members an opportunity to share success stories, and encourage fellow members to find value through participation in MTI’s projects, training programs and networking resources.

Joint applications were permitted for the first time in 2015 to further encourage participation and collaboration among members. As a result, dual applicants AkzoNobel and Ellett Industries received the Global Value Award for applying knowledge from an MTI Fabrication Panel Session and net-working in the redesign of a Saskatoon Catalyst Chamber. A second team of value-case applicants, ExxonMobil and Webco Industries, were recognized for leveraging the MTI

network in the joint development of enhanced surface duplextubemeetingNACE’sMR0103standard.

Two individual member companies were also recognized duringtheceremony–NobelClad,forthecompany’s application of TAC Awareness Bulletins to reinforce team knowledge in materials subjects, and The Dow Chemical Company, for its use of MTI’s Mothballing Guide in contributing to the reliability, profitability and sustainability of the company’s operations.

Overall, the MTI Value Awards have exemplified that participation equals value, with the recognition of 12 member companies in the first two years of the award program. MTI hopes to continue the tradition of recognizing the participation, collaboration and value of its members for years to come.

Members Recognized at Value Awards Ceremony for Application of Knowledge from MTI

Left: AkzoNobel’s catalyst chamber needed to fit in a cramped space in the facility (shown during installation). Ellett Industries came up with a solution. Right: MTI announced its 2015 Value Awards winners at AmeriTAC 118 in Houston. (Left to right) Michael Blakely,

NobelClad; Robert Gill, Ellett Industries; Ed Naylor and Ila Klassen, AkzoNobel; Ivan Morales, ExxonMobil; Bill Bieber and Tony Swart, Webco Industries; and Gene Liening, The Dow Chemical Company, accepted the honors at a special dinner celebration.


2015 HIGHLIGHTS

confidence in data, etc.) than more qualitative methods. It provides practical recommendations and has been appliedatnumerousrefineriestomakeinspection/ replacement decisions.

Although the proposed monitoring tools are promising, each needs further validation.

MTI’s plans include focusing on a technical review of potential assessment methods for HTHA and holding additional HTHA structured forums and panel sessions. There will be a special roundtable session during the Spring 2016 EuroTAC Meeting. The future goals will include continuing to share end users’ experiences, review of state-of-the-art NDE techniques applicable to HTHA damage, analyze potential models to predict damage, and assess how the evolution of metallurgy may affect HTHA susceptibility.

MTI’s outlook on finding effective methods to prevent and monitor HTHA is optimistic; ultimately, participation in forums, roundtables, and in developing projects could lead to valuable resources for MTI member companies experiencing problems caused by HTHA.

At a special High Temperature Hydrogen Attack (HTHA) presentation/panelsession,heldinconjunctionwithMTI’sFall 2015 AmeriTAC Meeting in Houston, several MTI member companies presented new ideas for risk assessment. The presenters included Equity Engineering, Stress Engineering Services and Becht Engineering.

Equity Engineering has an on-going Joint Industry Project to evaluate the repeatability of existing HTHA inspection methods found in API 941 and improving existing NDE protocols to allow for more accurate detection of HTHA damage.

Stress Engineering Services has developed a predictive method that transforms the temperature-hydrogen space inAPIRP941NelsonCurvetoatime/temperature parameter-methane pressure parameter curve that allows users to (1) assess their equipment versus the existing API RP 941 failure population and select literature data; (2) place equipment on the their risk matrix; and (3)prioritizeinspectionsand/orreplacements.

Becht Engineering’s HTHA Action Prioritization method considers many more factors (time, stress,

Special HTHA Session Presents New Ideas on Risk Assessment

Fissures and cracks, formed by methane, relieve the internal pressure in the weakened steel.

Areas of high stress can accelerate HTHA, leading to the loss of ductility and toughness, and sometimes result in failure.


manual covers establishing and documenting the design basis for a hose, procurement practices, including auditing of suppliers, tagging and labelling,inspection/ replacement decision making, in-service inspection and testing, and common failure modes. Experience has demonstrated that uniform implementation of these best practices in an operating facility for all hose applications, results in an effective hose management program.

MTI will add Reliability Guidelines for Flexible Hoses to the bookstore for purchase in the coming year.

In the of fall 2015, MTI published Reliability Guidelines for Flexible Hoses in an effort to provide value to member companies trying to establish a hose management program. The manual, written by MTI member Steve Springer of Chemours, describes the life cycle best practices for maintainingand/orimprovingthereliabilityofflexiblechemical process hose applications.

In his previous employment with member company DuPont, Springer developed an expertise in the area. He then recognized a need in the industry for improved mechanicalintegritypracticesrelatedtoflexiblehoses. A project team was formed following AmeriTAC 107, providing a wider range of MTI member company input in developing the new set of guidelines.

The final result is a manual that encompasses Mechanical Integrity and Quality Assurance (MIQA) principles for hose applications across a much broader spectrum than that provided by manufacturers. The new

Reliability Guidelines for Flexible Hoses

Fiber Reinforced Plastic (FRP) tanks are employed to handlecorrosivefluidsinindustrialplantsworldwide.Thesize and quantity of FRP equipment implemented in power utilities, chemical and mineral processing facilities, and pulp and paper mills has steadily increased in recent years.

In 2015, MTI published Guidelines for Large Diameter FRP Tanks, which is the first effort to provide a consolidated document on FRP Large Diameter Field Fabricated Tanks (LDFTs). LDFTs are currently being used for liquid stor-age tanks, gas scrubbers, and processing vessels in a variety of applications. Active participation from a team of MTI members resulted in the Guidelines, which provide a funda-mental knowledge of LDFTs, supported by discussions and examples. The purpose of the manual is to offer a compre-hensive and organized discussion of LDFTs, which to date, has not been well documented in either the public domain

or technical standards. Until recently, LDFTs have been a rarity. Howev-er, due to recent advance-ments in materials and manufacturing processes, they are becoming a more frequent and viable option for plant owners.

The publication will be made available for purchase in the MTI bookstore, and the team expects the guidelines can further prepare and provide value to plant owners and engineers in their efforts to successfully execute LDFT projects.

Guidelines for Large Diameter FRP Tank Projects


2015 HIGHLIGHTS

In June 2015, the MTI Board approved a five-year continuation of the Bert Krisher Scholarship Award program, and as a result, the 2016 scholarship attracted a pool of well-qualified applicants.

The winners, Mary Teague, a junior at the University of Akron, and Will Hoskins, a junior at the University of Tennessee–Knoxville,eachclaimeda$5,000scholarshipby demonstrating education, interest and experience in the process industries.

Teague, a corrosion engineering major, said she not only appreciated that the scholarship would alleviate some of her financial burden, but also looked forward to some of the opportunities to participate in MTI, such as networking with members (potential future employers).

Hoskins, a materials science and engineering major, notedhisgratitudebylabelingitthe“pinnacleof scholarships.”Hehasambitiousplanstousethemoney

toward furthering his education and to present his researchonHighTemperatureHydrogenAttackinC-1/2Mo Steels at the International Conference on Hydrogen Attack Materials in Wyoming (Sept. 2016).

The MTI Board recognizes the value of participation from young and upcoming engineers and, with the continuation of the scholarship, looks forward to awarding future out-standing candidates.

University of Akron and Tennessee-Knoxville Students Win 2016 MTI Scholarships

Will Hoskins Mary Teague

On October 26, 2015, MTI offered a Ceramics 101 training course during AmeriTAC 118 in Houston. The course was intended for engineers and technologists who work with ceramics on a regular basis, but have little background in the area. Approximately 50 participants at-tended the training, which provided a general introduction to ceramic materials and covered characteristics, properties, fabrication, applications and design portions. Eric Minford of Eric Minford Consulting, LLC, a PhD Ceramicist from

Penn State University with 27 years of experience as a Lead Research Engineer with Air Products, presented the information. Attendees gained a basis for understanding the general behavior of ceramics and how and when to best use their advantages while minimizing their weaknesses. MTI will continue providing face-to-face and online technical training sessions, like Ceramics 101, in its efforts to provide unique educational opportunities to participants from mem-ber companies worldwide.

Special Training Course Teaches Participants How to Use Ceramics to their Advantage


Inresponsetoreportedfailuresofseveralreactoreffluentair coolers (REACs), MTI members initiated a project to review failures and develop a best practices guide for the design, welding, repair, and inspection of 2205 duplex stainless steel (DSS) equipment made from thick plate (> 1 inch). Because some of the failures led to fires and explosions, the importance of this project was very clear. The project champion, David Moore, Discipline Leader–Materials&CorrosionatBP,begantheprojectby gathering and organizing the data from member case histories of failures into a working paper. The project team members, 41 participants in total, reviewed and provided

feedback on the clarity of the information and correctness of the analyses. Through project team meetings at MTI AmeriTAC meetings and numerous teleconferences, a comprehensive guideline was written and published. The book is organized in three sections: Introduction to DSS REACs in Hydroprocessing Units; Guidelines for Design, Welding, Repair, and Inspection; and Guidelines for In-service Inspection. Thanks to the input and participation from so many members, the result is a valuable publication that will soon be available for purchase from the MTI bookstore.

Project Team Develops Guideline for Design, Welding, Repair, and Inspection of DSS REACs

Above: MTI project examines duplex stainless steel weld failures. Top Right: Spray from a cracked 2205 welded header box during high pressure water test.

Middle Right: Cross section of a header box weld (top plate-to-plug sheet weld). Failure analysis revealed cracking away from the leak.

Bottom Right: The heat affected zone in this cracked weld micrograph shows that the ferrite was high at 72% compared to the 60% desired maximum.

MEMBER COMPANIES AND DESIGNATED REPRESENTATIVES*

ExxonMobil Research and Engineering Company

Spring, TexasJohn Houben

Allegheny Technologies Incorporated

Pittsburgh, Pennsylvania John Grubb

Ascend Performance Materials, LLCHouston, Texas William Paden

Air Products and Chemicals, Inc.Allentown, Pennsylvania

Minfa Lin

AkzoNobelAmsterdam, The Netherlands

Ed Naylor

Albemarle CorporationBaton Rouge, Louisiana

Hardin Wells

ELLETT Industries Ltd.Port Coquitlam,

British Columbia, CanadaBob Gill

Engineers India LimitedNew Delhi, IndiaGhosal Surajit

The Dow Chemical CompanyFreeport, TexasDavid Barber

DuPont CompanyWilmington, Delaware

Robert Freed

Dow Corning CorporationMidland, Michigan

Marc Cook

Eastman Chemical CompanyKingsport, Tennessee

Robert Sinko

BASF CorporationLudwigshafen, Germany

Ben McCurry

Electro Chemical Engineering and Manufacturing Co.

Emmaus, PennsylvaniaDale Heffner

Asahi Kasei CorporationTokyo, Japan

Masao Nakahara

Air LiquideParis, FranceJader Furtado

3MSt. Paul, Minnesota

Cody Kell

The Equity Engineering Group, Inc.Shaker Heights, Ohio

Ken Kirkham

The Chemours CompanyWilmington, Delaware

Steven Springer

FMC CorporationPhiladelphia, Pennsylvania

Srini Kesavan

Haldor Topsoe A / SKgs. Lyngby, Denmark

Maria Jose Landeira Oestergaard

Haynes International, Inc.Kokomo, Indiana

Paul Manning

Hellenic Petroleum S.A.Thessaloniki, Greece

Ioannis Melas

Celanese CorporationDallas, TexasAshok Rakhe

Bayer Technology Services GmbHLeverkusen, Germany

David Lu

BPLondon, England

David Moore

ConocoPhillips, Inc Houston, TexasDale McIntyre

Chevron Corporation Richmond, California

Kevin Ganschow

Becht Engineering Co., Inc.Liberty Corner, New Jersey

Eileen Chant

Corrosion MaterialsBaker, LouisianaJacob Rodriguez

HoneywellMorristown, New Jersey

Bill Salot

Jiuli Hi-Tech MetalsHuzhou, Zhejiang, China

Zhu Xiaofeng

Huntsman Petrochemical LLCThe Woodlands, Texas

Nina Young

Industrial Technology Research Institute

Chutung, Hsinchu, TaiwanTzu-Ping Cheng


Marathon Petroleum Company LPFindlay, Ohio

Dana Williams

Lloyd’s Register Energy Americas, Inc.

Houston, TexasRoxanna Alvarez

Koch IndustriesWichita, Kansas

Terry Jarrett

Nickel InstituteToronto, Ontario, Canada

Gary Coates

Outokumpu, Inc.Espoo, Finland

Poul-Erik Arnvig

LyondellBasellChannelview, Texas

Scott Dufault Polycorp, Ltd.Elora, Ontario, Canada

Dennis Nolan

Tricor Industrial, Inc.Wooster, OhioChuck Young

P.A. Inc.Houston, TexasOtis Galloway

Praxair, Inc.Danbury, Connecticut

James White

RathGibsonJanesville, Wisconsin

Jim Baumann

RL IndustriesFairfield, Ohio

Brian Linnemann

Roben Manufacturing Co., Inc.Lakewood, New Jersey

Kelly Wyrough

Mitsui Chemicals, Inc.Tokyo, Japan

Hiroyasu Matsuda

VictaulicEaston, Pennsylvania

Mike Griffin

Webco Industries, Inc.Sand Springs, Oklahoma

Bill Bieber

TOTAL SAParis, France

Francois Dupoiron

TITAN Metal FabricatorsCamarillo, California

Nick Zentil

Syncrude Canada Ltd.Fort McMurray, Alberta, Canada

Michael Anderson

Titanium Fabrication Corp.Fairfield, New Jersey

Troy BartleySandvik Materials TechnologySandviken, SwedenMarcelo Senatore

Rolled AlloysTemperance, Michigan

Paul Whitcraft

SABICRiyadh, Saudi Arabia

Sivuyile Funani

Saudi International Petrochemical Company

Jubail Industrial City, Saudi ArabiaAl Biggs

SIMONA AmericaKirn, GermanyGreg O’Brien

Schmidt+Clemens GmbH+Co KGLindlar, GermanyDietlinde Jakobi

Quadrant Engineering Plastic Products

Reading, PennsylvaniaAdam Rickert

NobelCladBoulder, Colorado

Mike Blakely

NOVA Chemicals CorporationCalgary, Alberta, Canada

George Donald Sonomatic LimitedCheshire, United Kingdom

Don Hurst

Stress Engineering Services, Inc.Mason, Ohio

Derrick RogersThe Roberts CompanyWinterville, North Carolina

Milton Eshelman

* Member companies as of 12/31/2015. PARTICIPATION EQUALS VALUE | 15

Michael Anderson, AmeriTAC Chair 1, 2, 3

Area Leader - Reliability & Performance ImprovementSyncrude Canada Ltd.

Mike Blakely, AmeriTAC Vice Chair 1

Global Director of Business DevelopmentNobelClad

Henry Ye, AsiaTAC Chair 2

Materials Engineering ConsultantDuPont Company

TECHNICAL ADVISORY COUNCILS

Tzu-Ping Cheng, AsiaTAC Co-Vice Chair 1, 2, 3

Research Supervisor, Department of Advanced Electrochemistry and Corrosion Prevention ResearchIndustrial Technology Research Institute

Guangbin Rao, AsiaTAC Co-Vice Chair 2

Senior Manager, Materials Engineering & NDTBASF Corporation

Dietlinde Jakobi, EuroTAC Chair 1, 2, 3

General Manager - Research & Development Services Centrifugal Casting DivisionSchmidt+Clemens GmbH+Co KG

Natalie Gelder, EuroTAC Vice Chair 3

Centers of Technical Expertise, LDPE Project EngineerBASF Corporation


The Technical Advisory Councils, composed of one representative of each member company, solicit project ideas, define projects, and recommend projects for approval by the Board of Directors.

1 AmeriTAC 2 AsiaTAC 3 EuroTAC

Waleed Al-Othman 1, 2, 3

ResearcherSaudi International Petrochemical Company

Poul-Erik Arnvig 1, 3

Vice President Global Market DevelopmentOutokumpu, Inc.

Jim Baumann 1, 2, 3

Director CPI SalesRathGibson

Bill Bieber 3

Director of Business DevelopmentWebco Industries, Inc.

Nils Boehle 3

Manager, Product Technology & Quality AssuranceAllegheny Technologies Incorporated

Paul Bosanko 3

CPI Market Manager EuropeHaynes International Inc.

Gregor Bueche 3

Europe Linings Sales ManagerQuadrant Engineering Plastic Products

Eileen Chant 2, 3

Engineering ManagerBecht Engineering Co., Inc.

Dior Chen 2

Sales EngineerHaynes International Inc.

Tong Chengyong 2

Regional ManagerJiuli Hi-Tech Metals

Ser-Hor Chong 2

Materials EngineerExxonMobil Research and Engineering Company


Daniel Christian 3

Director - Power Market Sales Europe-Middle East-IndiaVictaulic

Gary Coates 1

Coordinator, AmericasNickel Institute

Marc Cook 1, 3

Reliability EngineerDow Corning Corporation

Evelyn Dayss 3

Materials EngineerThe Dow Chemical Company

Vinay Deodeshmukh 1

Senior Staff EngineerHaynes International Inc.

George Donald 1, 2, 3

Mechanical Engineer, Regional MetallurgyNOVA Chemicals Corporation

Scott Dufault 1, 2

Principal Materials EngineerLyondellBasell

Francois Dupoiron 1, 2, 3

Materials and Corrosion ExpertTOTAL SA

Milton Eshelman 1, 2, 3

Senior Design EngineerThe Roberts Company

Robert Freed 1

Principal Materials ConsultantDuPont Company

Sivuyile Funani 1, 2, 3

Senior Engineer, MetallurgySABIC

Jader Furtado 1, 2, 3

R&D International Expert – Physical MetallurgyAir Liquide

Otis Galloway 1, 2, 3

PresidentP.A. Inc.

Kevin Ganschow 1, 2, 3

Materials EngineerChevron Corporation

Justinn General 1, 2, 3

Regional Metallurgist - Eastern USRolled Alloys

Bob Gill 1, 2, 3

Vice President - SalesELLETT Industries Ltd.

Mike Griffin 1

Director - Tools and Materials TechnologyVictaulic

John Grubb 1

Manager Product Technology - DevelopmentAllegheny Technologies Incorporated

Christoph Hantsch 3

Mechanical Engineer/EWELyondellBasell

Dragon Hao 2

Technical Marketing ManagerSandvik Materials Technology

Dale Heffner 1, 2, 3

Vice PresidentElectro Chemical Engineering and Manufacturing Co.

Continued on Page 18

Mark Hilton 1, 2, 3

Engineering Fellow Materials CorrosionAscend Performance Materials LLC

John Houben 3

Discipline Team Leader Fabrication, Welding Surface EngineeringExxonMobil Research and Engineering Company

John Huang 2

Sales ManagerAllegheny Technologies Incorporated

Curtis Huddle 1

Materials EngineerEastman Chemical Company

Don Hurst 1

Business Development ManagerSonomatic Limited

Terry Jarrett 1, 2, 3

Global Reliability DirectorKoch Industries

Cody Kell 1

Senior Materials Engineer3M

Srini Kesavan 1, 2, 3

Principal Engineer - MaterialsFMC Corporation

Yong-Joo Kim 1, 2

Vice President Technical ServicesWebco Industries, Inc.

Ken Kirkham 1

Principal EngineerThe Equity Engineering Group, Inc.

Rocky Kuykendall 1, 2, 3

Vice President of EngineeringTitanium Fabrication Corp.

Denny Lee (Li Zhengzhou) 1

Deputy General ManagerJiuli Hi-Tech Metals

Zhang Licheng 2

Managing Director ChinaNickel Institute

Gene Liening a

Materials Engineering Technology FellowThe Dow Chemical Company

John Lilley 3

General ManagerSonomatic Limited

Minfa Lin 1, 3

Lead Materials EngineerAir Products and Chemicals, Inc.

Brian Linnemann 1, 2, 3

VP OperationsRL Industries

Hiroyasu Matsuda 1, 2, 3

Director, Safety & Environment DivisionMitsui Chemicals, Inc.

Ben McCurry 1

Manager, Mechanical & Machinery Technical ExpertiseBASF Corporation

Dale McIntyre 1, 2, 3

Consultant MetallurgyConocoPhillips, Inc.

Ioannis Melas 1, 2

Inspection Department ManagerHellenic Petroleum S.A.

David Moore 1

Discipline Leader - Materials & CorrosionBP

Masao Nakahara 1, 2, 3

SpecialistAsahi Kasei Corporation

Ed Naylor 1

Senior Materials Engineering AssociateAkzoNobel

Gregory O’Brien 1

Product Manager CPISIMONA America Inc.

Maria Jose Landeira Oestergaard 1, 2, 3

Principal Engineer Senior Materials SpecialistHaldor Topsoe A/S

Harisios Papakostas 3

Inspection Department ManagerHellenic Petroleum S.A.

Stephane Pauly 3

Sales DirectorNobelClad

Shuo Peng 2

Manager, Asia R&D CenterVictaulic

Jorge Perdomo 1

Welding and Metallurgy SpecialistExxonMobil Research and Engineering Company

Ashok Rakhe 1, 2, 3

Fellow EngineerCelanese Corporation

Adam Rickert 1

Application Development ManagerQuadrant Engineering Plastic Products

Jacob Rodriguez 1

Technical Sales Engineer, MetallurgistCorrosion Materials


TECHNICAL ADVISORY COUNCILS

Derrick Rogers 2, 3

Staff ConsultantStress Engineering Services, Inc.

Bill Salot 1, 2, 3

Principal EngineerHoneywell

Bernard Schulze 1

Staff ConsultantStress Engineering Services, Inc.

Knuth Schweier 3

Head Corrosion & Inspection ManagementBayer Technology Services GmbH

Tony Scribner 1

Senior Adviser IIBecht Engineering Co., Inc.

Marcelo Senatore 1

Technical Marketing ManagerSandvik Materials Technology

James Shipley 3

Global Technical Marketing ManagerSandvik Materials Technology

Robert Sinko 2, 3

Associate Materials EngineerEastman Chemical Company

Steve Sparkowich 2

Business Development ManagerNobelClad

Steven Springer 1, 2, 3

Senior Consultant - Materials EngineeringThe Chemours Company

Michael Steinberg 2

General Manager, TITAN Metal Fabricators, WuxiTITAN Metal Fabricators

Peiwu Sun 2

Mechanical Integrity Team LeaderDow Corning Corporation

Chang-Ching Sun 2

Vice President - Technical Development / BA Stainless Asia Pacific AreaOutokumpu, Inc.

Ghosal Surajit 1, 2, 3

Deputy General ManagerEngineers India Limited

Michael Szymanski 1

Materials and Corrosion SpecialistBayer Technology Services GmbH

Frederic Tabaud 3

Principal Engineer - Materials & CorrosionBP

Jan Van de Wetering 3

Expertise Head - Corrosion EngineeringAkzoNobel

Joerg Wagner 3

European Sales ManagerTITAN Metal Fabricators

Yunxiang (Winnie) Wang 2

Metallurgy SpecialistBP

Hardin Wells 1, 2, 3

Distinguished Advisor - Mechanical Tech ServiceAlbemarle Corporation

James White 1, 2, 3

Associate DirectorPraxair, Inc.

Dana Williams 1, 2, 3

Principal Engineer, Materials & Corrosion SpecialistMarathon Petroleum Company LP

Kelly Wyrough 1, 2, 3

Director of Technical ServiceRoben Manufacturing Co., Inc.

Zha Xiaochun 3

Chief RepresentativeJiuli Hi-Tech Metals

Ryan Yang 2

Materials Engineer, AsiaAir Products and Chemicals, Inc.

Daniel Yiptong 1, 2

Technical ManagerPolycorp, Ltd.

Sunila (Nina) Young 1

Staff Engineer, Inspection/MetallurgicalHuntsman Petrochemical

Chuck Young 1, 2, 3

Business Development ManagerTricor Industrial Inc.

Nick Zentil 1

Vice President, Sales & MarketingTITAN Metal Fabricators

Wei Zhang 2

Leader of Quality InspectionAkzoNobel

Li Zhang 2

Materials and Corrosion SpecialistBayer Technology Services GmbH

Ling Zhou 2

Engineering SpecialistThe Dow Chemical Company

PARTICIPATION EQUALS VALUE | 191 AmeriTAC 2 AsiaTAC 3 EuroTAC

The Materials Technology Institute has been helping its members manage their aging plants since the five founders came together at a NACE Meeting in 1976. Those experienced engineers recognized the benefit of sharing non-proprietary research project costs as well as the value that they would all realize by participating in a network of experts.

Forty years later, and the original collaborative model is still working and in some cases, it has evolved. For example, in 2014 MTI co-hosted a first-ever Managing Aging Plants Conference and Expo with meeting producer and industry publisher KCI. Many MTI member companies participated in the two-day event held in Dusseldorf, Germany.

In 2016, the MTI-KCI team produced a Managing Aging Plants Conference in Japan and will hold a first-ever event in North America in Houston this November. The MAPs AmericasConference&Expowillincludemorethan30technical presentations, several panel sessions, a special project-brainstorming forum, and much more. A Steering Committee of MTI member representatives from chemical processing and oil & gas operations around the world are busy planning this unique event.

Not only will MAPs North America address things like changing regulations, disappearing materials, corrosion, and exciting new developments in inspection, but the event will zoom in on the particularly challenging issue of Managing an Aging Workforce. In 2015, MTI lost longtime member representatives and key contributors to retirement and other factors. While attrition is not a new challenge in

the Process Industries, it’s a concern for our members, many of whom are asked to do more with less.

MTI has always helped its industry members manage aging equipment, but it has evolved into a go-to resource for the ever-changing, multi-generational workforces responsible for safely operating those plants. When technical personnel leave their organizations, a global network of more than a thousand engineering experts are a few clicks away at the online MTI forum. When young engineers need to come up to speed quickly, they have rapid access to information via MTI’s extensive technical e-library and an archived forum full of potential solutions.

There are many other ways that MTI helps companies manage their aging workforces, from access to its pool of talented scholarship winners to ongoing training of engi-neers to the chance to absorb safety and reliability cultural best practices from industry leaders. In 2015, MTI offered seminars and presentations on hot topics ranging from high temperature hydrogen attack to ceramics to robotic inspec-tion. These are just a few of the many collaborative efforts that created value for members.

The loss of materials engineering leaders and subject matter experts due to retirement, spinoffs, and other factors is inevitable. MTI will continue to fill the void for its members, sharing practical knowledge in its databases, answering technical questions in real-time, and preparing the next generation of engineers for the challenges that they face in the future.

MTI is a Go-to Resource for an Ever-changing Workforce


MTI has evolved into a go-to resource for the ever-changing, multi-generational workforces responsible for safely operating plants.

“ The MTI forum is one of the best tools for less experienced

engineers to obtain guidance and help on issues from more

experienced engineers. The added benefit for a refiner in MTI

is that chemical processing companies have a different approach

and application of materials technologies (like FRP, chemical

resistant masonry, nonmetallics, etc.) that has little penetration

in refineries. Seeing how chemical processing industries deal

differently with materials issues gives new options to consider

for refining materials issues.”

Kevin Ganschow, Chevron

“ The training MTI creates and provides is the most obvious way that

it helps member companies deal with the loss of senior technical

talent. However, there are other more subtle ways that MTI helps

with this challenge. The senior experts set a great example

of mentoring and regulatory compliance. They also help

young engineers to understand how materials engineering

technologies contribute directly to a company’s safety and

environmental performance.”

Gene Liening, The Dow Chemical Company

“ We’re in the midst of dynamic change within the engineering

workforce. New engineers work very differently than older

engineers. Long reports are passé; immediate response and focused

knowledge transfer are the new norm. The amount of time spent

crafting a recommendation or making a judgement is decreasing,

while the regulatory ramifications of poor decisions are rapidly

increasing. MTI and its repository of knowledge helps bridge

the gap between being both responsive and thorough.”

Ed Naylor, AkzoNobel



MTI 2015: PARTICIPATION QUANTIFIED

Online Forum Posts Made by Members

Online Forum Replies to Posts From Members

134 491

5Materials Engineers with Active Profiles

on MTI Website

Inspection and Use of Equipment with Missing

Documentation

Plastic Repair Welding

Global FRP Standards

Reliability Guidelines for Flexible Hoses

Guidelines for Large Diameter FRP Tanks

Permeation through Polymers

Rouging II

Western Canada Roundtable

Ceramics 101 Training

Duplex Stainless Steel Training

Translation of MTI Documents into Chinese

Intergranular Corrosion and Cracking of CN7M/CN3MCu

Castings

Number of Projects Completed:66

1,161

12Member Companies — Highest Membership in MTI History

New Member Companies

Joined in 2015


MTI 2015: PARTICIPATION QUANTIFIED

In New Project Funding Approved by TAC Members and Board of Directors

Project Teams / Champions

Roundtable Forum

Training Sessions Worldwide

New Projects Launched

Special Panel Sessions

TAC Technical Presentations

Books Published

Project Team Members

Active Project Development Committees

29

1

3

21

5

39

6

424 5

$275,000

7TAC Meetings

Worldwide:

Three AmeriTAC

Two AsiaTAC

Two EuroTAC

STATEMENTS OF ACTIVITIES For the Six Month Period Ended December 31, 2015

Revenue and Support: Membershipdues $ 995,682 Interest 15,453 Productsales 3,747 Meeting fees 22,806 Investment loss, net of fees 987 Totalrevenueandsupport 1,036,701

Expenses: Program Services: Wages and benefits 577,549 Projects 417,340 AmeriTAC meeting 82,097 Asia TAC meeting 28,744 EuroTACmeeting 19,783 Totalprogramservices: 1,125,513

Supporting Services Generalandadministrative 131,885 Marketing 45,518 Communications 18,763 Website 7,852 Total supporting services 204,018

TotalExpenses 1,329,531

Changeinnetassets 292,830

NetassetsasofJune30,2015 1,574,517

NetassetsasofDecember31,2015 $ 1,281,687

The accompanying notes to the financial statements are an integral part of this statement.

Financial Statements – December 31, 2015

STATEMENTS OF FINANCIAL POSITIONAs of December 31, 2015

ASSETSCurrent assets: Cash and cash equivalents $ 309,645 Certificatesofdeposit 1,575,309 Accruedinterestreceivable 9,238 Prepaidexpensesanddeposits 13,142 TotalCurrentAssets $ 1,907,334

Property and equipment, net of accumulated depreciation 6,494

$ 1,913,828

LIABILITIES AND NET ASSETS

Current liabilities: Accountspayable $ 83,759 Accrued wages 15,161 Accrued paid time off 16,248 Otheraccruedexpenses 3,278 Deferreddues 513,695 Totalcurrentliabilities 632,141

NET ASSETS Unrestricted 1,281,687

$ 1,913,828


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MTI is at the end of a three year process to improve our budgeting and financial management processes. We have updated our financial policies, revised our budgeting process to make it more understandable, started forecasting and tracking cash flow, changed our auditing company, and changed our fiscal year to match the calendar year. The change in fiscal year aligns our accounting with our membership dues, which simplifies and improves the accuracy of our budgeting and accounting.

BecausewehavemovedtheendofourfiscalyearfromJune30toDecember31,ourauditorswererequiredtoauditthisshort(6month)fiscal year rather than wait 18 months for an audit. As a result, the financial statements from this one-time, six month audit cannot be compared directly with previous year results. As you can see in the letter from the auditors, they gave us a clean report, as always.

I believe the best way to provide a sense of MTI’s financial condition is to compare our cash positions over the past three years. It is a reasonable comparison, as our bills are always paid promptly and account payables

are always low. The following chart shows our available cash at the end of those years. The numbers show that our available cash has declined by slightlymorethan$300,000overthetwoyearperiod.Thisisinkeepingwith the Board’s direction to invest our surplus funds into activities that return value to our membership.

Bank Balance Dec.31,2013 . . . . . . . . . . . . . .$2,069,321 Dec.31,2014 . . . . . . . . . . . . . .$1,987,053 Dec.31,2015 . . . . . . . . . . . . . .$1,728,969

MTI has a healthy bank balance, great activities around the globe, and a growing list of active projects that will provide measurable value to our members.

John Aller Executive Director

Independent Auditor’s Report

Board of DirectorsMaterials Technology Institute, Inc.

Report on the Financial StatementsWe have audited the accompanying financial statements of Materials Technology Institute, Inc. (a not-for-profit organiza-tion), which comprise the statement of financial position as of December31,2015,andtherelatedstatementsofactivitiesandchangeinnetassets,andcashflowsforthesixmonthperiodthen ended, and the related notes to the financial statements.

Management’s Responsibility for the Financial StatementsManagement is responsible for the preparation and fair presenta-tion of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presenta-tion of financial statements that are free from material misstate-ment, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accor-dance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor consid-ers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluat-ing the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is suffi-cient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of MaterialsTechnologyInstitute,Inc.asofDecember31,2015,andthechangeinitsnetassetsanditscashflowsforthesixmonth period then ended in accordance with accounting principles generally accepted in the United States of America.

SFW Partners, LLCMay 19, 2016

STATEMENTS OF CASH FLOWS For the Six Month Period Ended December 31, 2015

Cash flows from operating activities: Changeinnetassets $ 292,830 Adjustments to reconcile change in net assets to net cash used in operating activities: Depreciation 2,399 Investment loss, net of fees 987 Changes in operating assets and liabilities: (Increase) decrease in assets: Accounts receivables 107,250 Publicationsinventory 103,289 Accrued interest receivable 452 Prepaid expenses and deposits 2,420 Increase (decrease) in liabilities: Accounts payable 6,125 Accruedwages 12,536 Accrued paid time off 1,165 Other accrued expenses 945 Deferred dues 462,820 Netcashusedinoperatingactivities 539,392

Cash flows from investing activities: Proceeds from redemption of certificates of deposit 169,047

Netdecreaseincashandcashequivalents 370,345

Cash and cash equivalents, beginning of the period 679,990

Cashandcashequivalents,endoftheperiod $ 309,645


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Financial Statements – December 31, 2015


Depreciation: The Organization provides for depreciation using both straight-line and accelerated methods based upon the estimated useful lives oftheassetsasfollows:officeequipment,3to7years.

Program Services: Program services include those expenses for programs and other items that enable the Organization to deliver value to its member organizations.

Supporting Services: Supporting services include the functions necessary to provide coordination and articulation of the Organization’s program strategies, secure proper administrative function of the Board of Directors, and manage membership, financial, and budgetary responsibilities of the Organization.

Income Taxes: The Internal Revenue Service has advised the Organization that it is exempt from income taxes under Section 501(c)(6) of the Internal Revenue Code. The Organization’s management does not believe that its exempt status has been significantly affected by any changes in its activities since the date of the most recent determination letter received. Accordingly, no provision for income taxes has been included in these financial statements.

The Organization accounts for any uncertain tax positions in accordance with the Income Taxes topic of the FASB ASC. The topic prescribes a recognition threshold and measurement process for financial statement rec-ognition of uncertain tax positions taken or expected to be taken in a tax return. In evaluating the Organization’s exempt status, interpretations and tax planning strategies are considered. The Organization believes it is not exposed to any current or future tax liability based on its current operations.

The Organization’s income tax filings are subject to audit by various taxing authorities. The Organization’s open audit periods are primarily the years endedJune30,2013throughJune30,2015andthesixmonthperiodendedDecember31,2015.

Revenue Recognition and Deferred Dues: Revenue is recognized in the period the income is earned. Membership income is typically received in advance. Accordingly, membership dues are earned ratably over the period, with the unearned portion shown as deferred revenue at the date of the Statement of Financial Position.

Publication Costs: The Organization produces publications, which report the results of its research projects. The Organization has evaluated the publicationsonhandatDecember31,2015andhasdeterminedthatthepublications’ direct costs of editing and production should be expensed due to the publications being primarily for the benefit of its members. During thesixmonthperiodendingDecember31,2015,theOrganizationwroteoff$103,289toprojectsexpensethatwaspreviouslycarriedasinventoryontheStatement of Financial Position.

Concentration of Credit Risk: The Organization, on occasion, maintains cash deposits with banks that include funds greater than the insured limit by the Federal Deposit Insurance Corporation. The Organization has not expe-rienced any losses in such accounts. The Board believes the Organization is not exposed to any significant credit risk related to cash. The amount on depositasofDecember31,2015didnotexceedtheinsuredlimits.

The Organization maintains cash equivalents and investments with a brokerage firm that includes funds greater than the insured limit by the Securities Investor Protection Corporation. The Organization has not expe-rienced any losses beyond normal market fluctuations. The Board believes the Organization is not exposed to any significant credit risk beyond normal market fluctuations related to cash equivalents and investments. The bro-kerageaccountasofDecember31,2015didnotexceedtheinsuredlimits.

Statement of Cash Flows: For purposes of the statement of cash flows, the Organization considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents.

Notes to the Financial Statements(1) Operations

MaterialsTechnologyInstitute,Inc.(the“Organization”)wasincorporatedunder the name Materials Technology Institute of the Chemical Process Industries,Inc.onDecember13,1976pursuanttothelawsofthestateofNew York as a tax exempt organization under the Internal Revenue Service Code 501(c)(6) to engage principally in the business of sponsoring research projectsforthechemicalprocessindustries.EffectiveDecember4,2003,theOrganization changed its name to Materials Technology Institute, Inc. The member companies are located in various countries.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting: The Organization’s financial statements have been prepared on the accrual basis of accounting and, accordingly, reflect all sig-nificant receivables, payables, and other liabilities.

Change of Fiscal Year End: Effective July 1, 2015, the Organization changeditsfiscalyearfromJune30toDecember31.Accordingly,thefinancial statements and the related notes to the financial statements are for thesixmonthperiodfromJuly1,2015toDecember31,2015.

Financial Statement Presentation: Pursuant to the Not-for-Profit Entities topicoftheFinancialAccountingStandardsBoard(“FASB”)AccountingStandardsCodification(“ASC”),theOrganizationisrequiredtoreportinformation regarding its financial position and activities according to the three classes of net assets: unrestricted net assets, temporarily restricted net assets, and permanently restricted net assets. As permitted by the topic, the Organization does not use fund accounting.

Restricted and Unrestricted Support and Revenue: Contributions are recognized when the donor makes an unconditional promise to give to the Organization. Gifts of cash and other assets received are recorded as unre-stricted, temporarily restricted, or permanently restricted support depending on the existence or nature of any donor restrictions.

Unrestricted contributions include resources available for the support of operations, which have no donor imposed restrictions.

Contributions that are temporarily restricted by the donor are reported as increases in unrestricted net assets if the restrictions expire in the fiscal year in which the contributions are recognized. All other donor restricted con-tributions are reported as increases in temporarily or permanently restricted net assets depending on the nature of the restrictions. When a donor restriction expires, that is, when a stipulated time restriction ends or a purpose restriction has been accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statements of activities as net assets released from restrictions. There were no temporarily orpermanentlyrestrictednetassetsatDecember31,2015.

Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclo-sures. Accordingly, actual results could differ from those estimates.

Investments: Investments are adjusted to market value at year end. Gains or losses on the sale of investments are recognized on a specific identifica-tion basis. Unrealized holding gains or losses, realized gains or losses, and interest and dividend income earned on the investments are included in investment income, net of fees on the statement of activities and change in netassetsforthesixmonthperiodendedDecember31,2015.

Property and Equipment: Property and equipment are stated at cost if purchased or fair value if contributed, less an allowance for depreciation. Material expenditures for property acquisitions and those expenditures which substantially increase useful lives are capitalized. Expenditures for maintenance, repairs, and minor replacements are expensed as incurred. When assets are retired or otherwise disposed of, their costs and related accumulated depreciation are removed from the accounts and resulting gains or losses are included in income.


Subsequent Events: The Organization evaluates events and transactions occurring subsequent to the date of the financial statements for matters requiring recognition or disclosure in the financial statements. The accom-panying financial statements consider events through the date of the inde-pendent auditor’s report, which is the date the financial statements were available to be issued.

(3) Fair Value Measurements

Under the Fair Value Measurements and Disclosures topic of the FASB ASC, a guideline is provided for measuring fair value under generally accepted accounting principles. The topic establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy consists of three broad levels: Level 1 inputs consist of unadjusted quoted prices in active markets for identical assets or liabilities and have the highest priority; Level 2 inputs include quoted prices in active markets for similar assets or liabilities, quoted prices in inactive markets for identical or similar assets or liabilities, or inputs that are observable or can be corroborated by observable market data or other means for substantially the fulltermoftheassetorliability;andLevel3inputshavethelowestpriorityand are based on prices or valuation techniques that are unobservable and not corroborated by market data. The Organization uses appropriate valuation techniques based on the available inputs to measure the fair value of its assets and liabilities. When available, the Organization measures fair value using Level 1 inputs because they generally provide the most reliable evidence of fair value. The Organization uses Level 2 inputs when an active marketcomparableisnotavailableandLevel3inputsareonlyusedwhenLevel1orLevel2inputsarenotavailable.TherewerenoLevel2orLevel3inputs for the Organization.

Level 1 Fair Value Measurements: The fair value of the investments is based on quoted market prices. The Organization’s certificates of deposit of$1,575,309asofDecember31,2015,usedLevel1inputsforvaluationpurposes.

(4) Property and Equipment

PropertyandequipmentconsistsofthefollowingatDecember31,2015:

Officeequipment $ 78,823 Accumulateddepreciation 72,329 $ 6,494

DepreciationexpenseforthesixmonthperiodendedDecember31,2015was$2,399.

(5) Leases

The Organization conducts part of its operations from a leased facility which includesofficespace.Theleaserequiresmonthlyrentof$1,611andwillexpire in June 2017. Additionally, the Organization leases certain office equipment under operating leases that expire at various dates through November 2019. Total lease expense for the six month period ended December31,2015was$11,321.

Future minimum lease payments required under the leases that have remaining noncancellable lease terms in excess of one year as of December 31,2015areasfollows:

YearsEndingDecember31, 2016 $ 22,761 2017 12,942 2018 3,072 2019 2,816

$ 41,591

Schedule of Annual Membership Dues for 2016Annual Sales Year 2016(US$ Billions) Dues – US$< 0.2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 12,4500.2–0.4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 17,2000.4–0.8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 21,7500.8–1.5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 26,3501.5–3.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 31,2003.0–6.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 35,8506.0–12.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 40,40012–25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 45,10025–50 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 49,85050–100 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 54,500100–200 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 59,200200–400 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 63,950400–800 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 68,500800–1,500 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 73,250

Basis for Assessing Company’s Membership DuesDues for membership are determined from the dues schedule published in the Annual Report. Dues are based on the total sales of all divisions of the member company for the most recently audited fiscal year at the time of invoicing. For organizations which do not publish audited sales figures, such as privately held corporations and state-owned-enterprises, the total sales must be certified by an officer. Membership dues for associations and other organizations which do not have revenue from sales will be considered by the Board of Directors on a case-by-case basis. The Board of Directors may make exceptions to this policy based on the discretion of the board.

(6) Employee Benefit Plan

The Organization maintains a 401(k) plan for all eligible employees. Under the terms of the plan, employees may contribute up to 92% of their eligible compensation, as defined in the plan. The Organization is required to match 100% of the first 5% of employees’ contributions to the plan. The Board may elect to contribute additional amounts to the plan. Employees are immediately vested in all contributions to the plan. The Organization’s matching contributions to the plan for the six month period ended December31,2015were$21,165.

(7) Commitments and Contingencies

AsofDecember31,2015,theOrganizationenteredintoacontractwithhotels to reserve a block of rooms and provide food and beverage services for meetingstobeheldin2016thataresubjecttocancellationfeesof$65,937.Management has no intention of cancelling any contracts currently in place.

AsofDecember31,2015,theOrganizationhasenteredinto18agreementswith various third parties to complete research projects on behalf of the Organizationwithremainingprojectcostsofapproximately$400,000.


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Benefits of MembershipMTI’s role is increasingly important as materials options expand in number and complexity and as shortages of trained staff constrain operations.

Through membership, companies gain the knowledge they need to better develop, manage, and maintain greenfield and retrofit construction projects, leading to greater efficiency, safety, reliability, sustainability and profitability.

Benefits: • Rapidandefficientsolutionstoproblems • Accesstoanexpertnetworkthatincludessome

of the world’s foremost materials technologists for immediate and vetted consultation

• Apoolofcooperativeresearchfundingthat multiplies the collected membership dues

• Anopportunitytoselect,scope,andlead projects conducted by others

• Privilegedaccesstointernallydeveloped information and project output

• Asearchabledatabaseofmorethan30years of Forum questions and discussion

MTI also helps member companies achieve bottom-line savings by transferring existing knowledge into commonly used practices, conducting technology evaluation studies, and providing access to a network of materials experts to help with urgent problems.

The representatives of member companies who participate in MTI activities help to raise the knowledge base among diverseplantstaffandoftenbecomethein–houseexpert(i.e.,the“go–toperson”)formaterialstechnologysolutions.In addition, the interaction among materials specialists and the leadership opportunities within MTI enhance career development.


Delivering Value to Members for 40 YearsThere are many ways that member companies benefit from their membership in MTI. Here are a few of the ways MTI works with its member companies to deliver value.

• Education and Training–Industryspecialistsand recognized experts share their unique knowledge and practical experience in tailored technical sessions on a wide range of topics, from Fitness for Service to Risk Based Inspection and much more.

• Knowledge Bank–Decadesofongoingteamwork has built a vault of valuable technical information available to members-only via MTI’s web site, forums, eBooks and reports, and other resources.

• Leveraged Funding–Combiningtheresourcesof like-minded companies enables MTI to sponsor fast-track projects that solve industry challenges in a fraction of the time at a fraction of the cost.

• Managing Aging Plants Conferences–MTICo-hostsManaging Aging Plants Conferences focused on issues, from new regulations to disappearing materials, everything effecting plants from cradle to grave.

• Networking Power–Interactingwiththebestmaterialsscience and engineering minds in the business, whether in person or online, provides unique opportunities to work and learn together.

• Research Studies–MTIcollaborateswithleadinglaboratories around the world, sponsoring studies that provide valuable technical information on metals, poly-mers, ceramics, and other areas of member company interest.

• Roundtables–MTIhostsRoundtableMeetingsthatbring together industry members facing common chal-lenges. These interactive meetings include project brain-storming sessions, special speakers, and networking in a community of materials engineering experts.

• Safety and Reliability Solutions–Membershavejoinedforces to develop an evergreen pool of useful informa-tion on static and rotating equipment, instrumentation, piping, heat exchangers, and utilities.

• Technical Forums–Inadditiontoface-to-faceTACand committee meetings, MTI’s online forum facilitates collaboration between experts that delivers answers to membersreal-time,24/7.


MTI will be the process industries’ first choice for materials technology networking and solutions.MTI’s Vision

MTI maximizes member asset performance by providing global leadership in materials technology to improve safety, reliability, sustainability and profitability.

MTI’s Mission

Materials Technology Institute, Inc.1215 Fern Ridge Parkway • Suite 206 • St. Louis, Missouri 63141–4408 U.S.A.

Tel: 314.576.7712 • Fax: 314.576.6078Email: mtiadmin@mti–global.org • Home Page: http://www.mti–global.org

About Materials Technology InstituteThe Materials Technology Institute, founded in 1977, is a unique, not–for–profit technology development organization representing private industry. It sponsors projects focused on both developing new technology and transferring existing knowledge to day–to–day practice. Practical, generic, nonproprietary studies are conducted on the selection, design, fabrication, testing, inspection, and performance of materials of construction used in the process industries. The scope of work includes evaluation of metallic, and non–metallic materials, optimum design applications, fitness–for–service, mechanical integrity and life cycle determinations, and economic factors affecting performance of vessels, tanks, piping and other components.

Through membership and networking within MTI, companies can access solutions to nonproprietary problems of major concern to the process industries. Members can capitalize on the extensive expertise of member company representatives, leverage their technology investment by participating in the direction and results of MTI projects, and utilize MTI’s books, reports, software and video training programs immediately as needed. Benefits to member companies are increased plant integrity, reliability and profitability.