Exxon Mobil and TransCanada PipeLines demonstrated installation of a new pipeline (X120) that is 50% stronger than the strongest pipeline steel commonly used for gas transmission systems today (X80) and is expected to substantially reduce pipeline project costs. ExxonMobil said the new pipeline could substantially improve the economics of developing remote natural gas resources, such as reserves in Alaska or Russia.

One mile of X120 pipe was installed as part of a longer pipeline looping operation in Northern Alberta in February 2004. The pipe was jointly developed under an agreement among ExxonMobil, Nippon Steel Corp. (NSC), and Mitsui & Co. Ltd. (Mitsui).

ExxonMobil spokesman Bob Davis said that because the steel is stronger than traditional steel, pipeline walls can be thinner, lowering overall project costs by 5% to 15%. He said it is still unclear when commercial development of the pipeline will occur.

“A lot of people are looking at Alaska but it’s all pretty speculative,” said Davis. “Other arctic projects in Russia also [would be a logical choice],” he said. “But you have to identify a large project first. I don’t want to say ‘chicken and the egg,’ but oftentimes you need to identify the project before the [steel] industry will make the investment. We haven’t identified a commercial project at this point.”

ExxonMobil teamed with TransCanada to demonstrate the suitability of the new material for use in commercial applications. NSC supplied the steel, and the pipeline was constructed to TransCanada specifications and Canadian standards using welding wire and procedures developed by ExxonMobil.

Construction of the one-mile pipeline demonstrated that the X120 steel is compatible with standard pipeline construction practices, even under severe Canadian winter conditions. The construction rate was comparable to rates expected for winter installation and the weld defect rate was lower than rates commonly reported for major pipeline projects, ExxonMobil said.

Other contributors to the project were Louisbourg Pipelines, the installation contractor, CRC-Evans, the welding equipment supplier that worked with ExxonMobil on development of the welding procedures, and the Alberta Energy and Utilities Board, the pipeline safety regulator that authorized the assets to be fit for operation.

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