Environmentally Sealed Groundbed Technology

1. Environmentally Sealed Groundbed Technology • Mike Ames • VP Engineering • SAE Inc., • Houston, TX • www.saeinc.com • Western Regional Gas Conference • Tempe, AZ • Aug 21, 2012 AGA-WRGC

2. Restoring Deep Anode Systems as a Viable Cathodic Protection Solution • Long a crucial mainstay of pipeline cathodic protection systems, traditional deep anode beds are currently falling into disfavor due to their negative environmental impacst and long term liability issues. • Understanding and fixing the problem… • Why traditional deep anode designs are in disfavor • New Requirements: Confronting new constraints • A Solution: Develop a new deep anode technology • Benefits: Technical, environmental and financial • Applications: The new deep well should have wide applicability • Performance Improvements: lower costs, longer life, higher current beds • Summary AGA-WRGC

3. The Issues and Constraints • Why Deep anode systems are in disfavor… • Water pollution has forced environmental regulatory agencies and landowners to reduce the use or practicality of deep wells and in some cases prohibit the use of traditional deep anode beds in sensitive areas • Numerous agencies also restrict anode bed depths, inhibiting the installation of suitably effective cathodic protection solutions and thereby increasing the failure risks for protecting pipelines and other infrastructure • Increasingly, governing agencies require abandonment bonds to assure closure of depleted anode beds, reducing the viability of the deep anode business case and creating long term possible legal and financial liabilities, requiring a return to the site to install seals. • Current anode system designs lead to early depletion of deep anode beds, with correspondingly lower current output levels and erratic outputs, due to depth limitations keeping them from aquifers. AGA-WRGC

4. The Challenges • To restore the viability of the deep anode bed: • Shallower deep wells deplete more quickly – provide for real deep wells again. • Extend the stable anode operational spans – reduce tap changing need • Reduce the negative environmental impact of deep anode systems, particularly in the area of underground aquifer contamination, soil contaminant migration, and decommissioning – make it sealed • Provide compliance to increasingly stringent environmental regulations negatively impacting on traditional deep anode systems – change design to make them acceptable for wide spread use. • Improve the business case for the use of deep anode beds – cost over life span vs up front costs AGA-WRGC

5. Typical Coke Breeze Deepwell Groundbed AGA-WRGC

6. Environmental Issues – Coke Breeze Beds • Coke breeze allows water/contaminants to travel up and down the hole • Vent pipes required are also open pathways for contamination/water • Vent pipes emit toxic and noxious gases to the surface • Aquifer zones are increasingly not allowed to be penetrated by coke breeze beds • Sealing coke breeze beds are difficult using standard technology of casings, or cement packed zones • It is possible to place the casing or concrete seal zone in the wrong spot. • Fractured aquifers cannot be adequately sealed and allow current output from the coke breeze bed (PVC type casings) • Steel casings are consumed by current from the groundbed and are not practical for aquifer sealing with coke breeze backfills AGA-WRGC

7. The New Technology Requirements • Develop an anode system that will… • Satisfy regulatory agency and landowner concerns for the protection of underground aquifers and reduce owner liability issues • Extend anode life expectancy • Improve anode electrical and environmental performance • Remove the need for vent pipe as a contaminant path • Provide for end of life closure at the time of installation, thereby reducing downstream costs and legal liability • Utilize existing anode installation methods and equipment AGA-WRGC

8. The Solution • Seven years of product development have yielded an innovative anode cathodic protection system that: • Uses a low permeable back fill - a new water impermeable, conductive solid backfill that protects aquifers and excludes soil migration • Protects the Anode - an anode coating material that extends anode bed lifetimes significantly (> 2 times) by eliminating chloride and sulfide attack • Improve anode electrical performance – electronic flow inside the groundbed, ionic flow outside • Enhances aquifer protection by eliminating vent pipes – push gas generation to the outside of the column. Also improves land owner acceptance • Allows the installation of full sized deep wells to provide adequate protection to pipelines and infrastructure. A return to appropriately sized deep wells • Is compatible with normal installation methods and equipment for all CP systems AGA-WRGC

9. The Technical Benefits • Improved electrical performance by significantly increasing the amount of energy transferred from the anode to the soil through an electronic process • Extended anode life expectancy, greater than double typical beds • More efficient and consistent anode performance over its effective life • Versatile and flexible technology allows deep anode beds to be constructed to nearly unlimited depths, using a variety of anode configurations suitable to the client’s cathodic protection design • Water impermeable design eliminates aquifer contamination paths • Does not require out-gassing vent pipes, simplifying deployment • Utilizes standard anode bed installation practices and equipment • Both custom and cost efficient standard anode bed designs are available AGA-WRGC

10. The Technical Benefits • Anode design and installation practices unchanged and even simplified: • Anode design based on measured soil characteristics like resistivity, moisture and salt content, and current output requirements • Common anode bed installation methods and equipment can be used • Minor learning curve to deploy the new deep anode technology • Vent pipes not used • Overall benefit: same or lower design and deployment costs, longer performance AGA-WRGC

11. Environmental Issues • Eliminating the vent pipe will eliminate these concerns ! • Note: Noxious gases and coke breeze deposits from existing vent pipe AGA-WRGC

12. Vent Gasses can be very corrosive and noxious AGA-WRGC

13. Corrosive liquids/gasses AGA-WRGC

14. NO chance of gas in shunt boxes EnvirAnode 9 Years Coke Backfill 9 Years AGA-WRGC

15. Aquifer contamination paths eliminated • Diagram of the sealed deep anode technology • Aquifer water does not migrate through the solid anode bed, thus ensuring no cross-contamination flow between aquifers • The entire anode column solidifies to provide an impervious permanent seal in the well • It can be imagined as a huge carbon anode in the soil • Surface contamination cannot penetrate to the underground aquifers through solid media • Gassing is dissipated on the outside surface of the column into the soil AGA-WRGC

16. The Environmental Benefits • Suitable for use in any cathodic protection system • Especially well suited for use in sensitive environmental areas and where underground aquifers are present, or soil contaminant migration may occur • Impermeable design inherently protects underground aquifers by sealing against contamination from surface and underground water sources • Anode design effectively manages out gassing to eliminate the need for a vent pipe • No anode bed environmental decommissioning costs as the bed is originally installed as a sealed system • Complies with regulatory requirements as an effective aquifer seal and eliminates landowner concerns of aquifer contamination • Restrictive states such as Texas and Kansas have accepted this system as an effective seal AGA-WRGC

17. Applications • This new anode and solid backfill technology is ideally suited for: • New impressed current anode bed installations • Retrofit anode bed replacements • Cathodic protection system upgrades • Cathodic protection systems located in environmentally sensitive areas where underground aquifers or soil contamination issues exist • Sites where traditional anode bed designs are prohibited by landowners or environmental regulatory agencies • Sites where aging infrastructure requires a higher performance cathodic protection system than that delivered by traditional CP solutions • Sites where longer life anode beds are required or specified • Sites where traditional CP solutions do not yield a viable ROI AGA-WRGC

18. The Technology: A Closer Look • Constructed from specially formulated anode and backfill materials that: • Promote electronic transfer of energy into the soil, while significantly dissipating the gases into the soil that would normally be vented to the atmosphere • Are water impermeable, reducing anode deterioration from electrolytic processes, and thereby significantly extending anode lifetimes while simultaneously improving electrical performance • Are chemically stable for a very low environmental impact • Pre-cast anode components: • Eliminate the mechanical and cost issues of using centering devices during the installation phase • Are assembled using dual jacketed insulated cables AGA-WRGC

19. The Technology: A Closer Look • Fabrication details: • Both the pre-cast anodes and backfill column are constructed from engineered hygroscopic carbonaceous materials that form a solid system • Once solidified, the entire anode system is water impermeable(with about the same permeability as bentonite) • Pre-cast anodes contain a Mixed Metal Oxide (MMO) coated electrode core • Pre-cast anodes are firmly secured to dual jacketed cables with a double compression crimp • The crimped connection is then embedded in resin to form an impermeable seal against water and other corrosive agents AGA-WRGC

20. The Technology: A Closer Look • Diagram of the new deep anode technology system as installed: • Aquifer water does not migrate through the solid anode bed, thus ensuring no cross-contamination flow between aquifers • The entire anode column solidifies to provide an impervious permanent seal in the well • It can be imagined as a huge carbon anode in the soil • Carbon consumption is from the outside surface towards the MMO core • Gassing is dissipated on the outside surface of the column into the soil AGA-WRGC

21. Anode Bed Cross Section AGA-WRGC

22. The Technology: Improved Performance • Technical characteristics of the new deep anode technology: AGA-WRGC

23. The Technology: Improved Performance • Accelerated Life Cycle Testing Results: • Anode life expectancydouble or more AGA-WRGC

24. Sealed Bed Performance - Refinery AGA-WRGC

25. Sealed Bed Performance – Salt Water Deep Well – Near King Ranch AGA-WRGC

26. Resistance Value Jan 06 to Oct 10 AGA-WRGC

27. 3 Kansas Deep Wells AGA-WRGC

28. Resistance Value of 36 Beds in a Refinery AGA-WRGC

29. Design Information Requested • All deep well groundbed designs are based on common data • What is the soil resistivity profile in the area? • How much current is required of the bed? • Is there a diameter or depth restriction? • What is the distance between the well head and the shunt box? • What is the desired life span at the required current output level? • “Cookie Cutter” groundbeds have been established by several companies based on their experience in a given area and with the common materials they have used successfully. This at times gets into their purchasing departments as the specifications for every groundbed. When bids go out, new technology is ignored by the purchasing agents as they do not fit the letter of the spec. • Cookie cutter groundbed specifications keep out good new technologies and if your company has them, they should be reviewed to allow consideration of this new technology. AGA-WRGC

30. The Technology: Regulatory Approvals • Relevant State environmental agencies that have restricted the use of deep well anode system are being contacted. • To date this technology has been accepted by: • The Railroad Commission of Texas • The State of Kansas Corporation Commission Notes: • Petitioning approvals now in Minnesota, Florida, New Jersey, California • California does not require the new sealed well’s “destruction” at end of life, as the bed is technically installed in a “closed” state. This has saved customers $5,000 per well on closure costs. • Kansas may not require “closure bonds” when the sealed bed is used. AGA-WRGC

31. Summary: Key Attributes • The new anode bed technology is constructed of highly conductive, water impermeable pre‑cast anodes and solid column backfill • Dual jacketed cables and double crimped, resin encased connections ensure the new anode design is sealed against water and corrosive agents • Engineered carbonaceous and environmentally neutral materials harness efficient electronic energy transfer to eliminate the need for out-gassing vent pipes • Anode life is extended, projections show up to double • The new anode technology systems are designed and built to the depth and energy output levels required • The system seals underground aquifers against surface and cross-contamination • The materials eliminate any soil migration paths • Eliminates future shutdown and decommissioning costs and liabilities • Accepted by Environmental Regulatory Agencies for use in impressed current deep well anodes AGA-WRGC

32. Summary: Benefits • A CP solution with sound technical, environmental and financial performance • A CP solution that prevents any soil migration issues • Flexible and versatile CP tool suitable for new and retrofit anode beds • High performance electrical characteristics with an extended lifetime • Inherent protection against the contamination of aquifers from surface or underground sources – a major environmental and landowner concern • Environmentally compliant design built from purpose engineered materials • Elimination of future decommissioning costs and attendant liabilities • All factors contribute to excellent bottom-line performance and ROI • Finally, and most importantly… • The new technology restores the viability of deep anode solutions as a critical tool in the struggle against infrastructure corrosion and preserves landowner’s water resources. AGA-WRGC

33. Questions? • E mail: mames@saeinc.com • Mike Ames 281 445 9311 • SAE Inc. • www.saeinc.com AGA-WRGC