Long Post 1 – History, installation and costs of pipelines

           There has been a long history of oil pipeline installation. Pipelines are one of the most cost efficient, most durable, reliable means of transporting oil from the depths of the ocean to oil refineries on land. The history of pipelines in Canada can be dated back to 1853, when a 25 km cast-iron pipe was moving natural gas to Trois Rivieres, QC (Canadian Energy Pipeline Association, 2019). Since then, Canada has built 119,000 km of underground transmission pipelines, able to reach from the west coast to the east coast and back again (Canadian Energy Pipeline Association, 2019). Submarine, or subsea pipeline production systems were introduced in 1942 when the English built a PLUTO (Pipe Line Under the Ocean) that aided allied forces after their landings during D-day in France (O-lay, 2019). The first subsea pipelines and production systems that were used for offshore extraction in the oil and gas industry was not until the late 1960’s. Divers were used to lay the first pipelines  connecting the flow lines and umbilicals to the wells (INTSOK – Norwegian Oil and Gas Partners, 2014). Gradually, better methods for producing and installing pipes became available and underwater transport of pipes became more realistic. It was not until the early 1990s that production of pipelines on the seabed was an option (INTSOK – Norwegian Oil and Gas Partners, 2014). Due to high costs and minimal advancements in pipeline technology, it was not economically feasible to transport oil by pipes and he preferred method was by boat. Since then, vast quantities of hydrocarbons have been produced by the use of such systems and today subsea production systems are used in all corners of the offshore world, providing solutions to various types of field developments (INTSOK – Norwegian Oil and Gas Partners, 2014).

           How pipelines are installed is a fascinating and interesting feat of engineering. As shown before in my previous  blog post, Icebergs are just the tip of the… well… Ice Berg, the challenges that need to be overcome can be brutal and ultimately project destroying – and sometimes fatal. Ever changing climates, rough weather and isolation are just a few of the factors that could potentially cause a pipeline to fall apart and at the worst case, explode. There are a multiple different ways that a pipeline can be installed but here is a list of the more common methods used today:

·         S-lay system

·         J-lay system

·         Reel-lay system

Each method has its own advantages and disadvantages, with the J-lay system being popular in deep waters and the S-lay being popular in shallow waters.

S-lay system

           As it may sound, the s-lay system is due to the shape of the pipeline as it is being laid onto the seabed (Gerwick, 2007). The s-lay system consists of assembling the pipelines at the extraction site, for example the Barents Sea. This method is useful in shallow waters (>50m deep), as the tension created from assembling pipelines this way could be too high in deeper waters (50+m deep). As the pipe in being laid, the ground provides support so there is minimal tension on the pipe itself. This method is efficient and requires relatively little external support (Gerwick, 2007). This makes it quick and cheap for laying multiple pipes down in a small time frame. A diagram of how this system works is shown below.

Figure 1 – S-lay system pipeline installation (Gerwick, 2007)

J-lay system

As stated before, the J-lay system is more appropriate for deeper waters as it provides enough support for the pipe at the surface while still being able to lay it on the bottom. This method is more effective as it puts the pipe straight down, as shown in the figure below, to avoid sharp bending at the end of it and to mitigate excessive sag bending (Gerwick, 2007). This method would best be suited in the Barents Sea project as the sea can become deep as you travel further away from land. This method, however does require advance methods of automatic welding to lay the pipe as the boat is moving, costing much more than the s-lay system (Gerwick, 2007).

Figure 2 – J-lay system pipeline installation (Gerwick, 2007)

Reel-lay system

One of the final common methods is the Reel-lay system. The reel-lay system has the pipeline assembled onshore versus at sea with the pipeline being spooled onto a large drum (Gerwick, 2007). This method has its advantages over the other two methods, as there are no adverse effects due to climate and technical issues and can make the installation much cheaper (Gerwick, 2007). This method is limited to how much pipeline can actually be preassembled and the type of material that can be used. Due to the pipe being put on a reel, it must first be able to bend to the spool and then be able to deform back to its original shape. This can cause some issues to the pipe as it becomes damaged when installing and can cause the project to run even long than initially planned. A figure of this method is shown below.

Figure 3 – Reel system pipeline installation (Gerwick, 2007)

After the pipe is laid it must then be dug underground to protect it from shifting and swaying. How this is done will be explained in the next blog post.

Arctic North INTSOK Project

For the project in the High North, the cost will be in the billions. The closest extraction site, site 1, is approximately 250 miles away from the closest port. According to USAID, the approximate cost per mile is about $1.5 million (USAID, 2004). This includes, materials, labour, miscellaneous and right-of-way and damages. The cost just for the pipeline installation of site one could be approximately $375 million. The project still needs to survey the ocean, install oil rigs, continuously maintain the pipeline as it could be damaged. The approximate total cost for all the pipelines to be installed is approximately $5.5 billion. The figure below is used to help visualize the total cost of installing the pipelines for each site. The orange line represents the total cost over time if they were to accept each project location from the previous post.

Figure 4 – Total Cost of INTSOK pipeline installation

As we move further away from shore, the costs raises more rapidly. The cause for this is not only the distance but also other factors, such as ice berg removal and transportation of materials. Sites 1 and 2 represent the easiest most economically feasible extraction sites. The technology today already exists so that oil and gas can be extracted from here (INTSOK – Norwegian Oil and Gas Partners, 2014). As we move further away, new technologies will have to be invented and new extraction methods will have to be discovered in order to make sites 3 through 6 plausible as extraction sites. Because the cost of the project raises drastically as we move further away from the shore, the cost of installation may out weight the potential income. The location of each potential extraction site is in shown in the 6 images below.

Figure 5 – Top left is location 1, top right is location 2, left middle is location 3, right middle is location 4, bottom left is location 5 and bottom right is location 6

Global perspective on subsea and pipelines

           To end this long blog post, I want to leave you with some information on the pipeline industry and some information on how big global this industry is. The subsea industry is today a truly global industry with an industry activity level amounting to billions of dollars in turnover (INTSOK – Norwegian Oil and Gas Partners, 2014). INTSOK had put together a figure below to show the current and expected activity and investment levels for the subsea installation business.

Figure 6 – EP expenditure by continent (INTSOK – Norwegian Oil and Gas Partners, 2014).

As the subsea pipeline business expands more and more, there will be a greater demand to move not only oil and gas through pipelines, but fresh water, internet cables, maybe even items. This industry could see an economic boom that could forever change how we move products around the world.

Next blog we’ll be looking at the processing of digging and best preparing the pipes for usage.


Canadian Energy Pipeline Association. (2019, February 14). How long has the pipeline industry been around? Retrieved from About Pipelines: https://www.aboutpipelines.com/en/pipeline-101/pipeline-history/, accessed on February 14th, 2019

Gerwick, B. C. (2007). Construction of marine and offshore structures. New York: CRC Press, accessed on February 14th, 2019

INTSOK – Norwegian Oil and Gas Partners. (2014). Russian – Norwegian Oil & Gas industry cooperation in the High North. Skoyen: INTSOK, accessed on February 14th, 2019

O-lay. (2019, February 14). History. Retrieved from O-lay: http://www.o-lay.net/history-pipe-laying-technology, accessed on February 14th, 2019

USAID. (2004). Natural Gas Value Chain: Pipeline Transportation. USAID, accessed on February 14th, 2019

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