During a visit to Lima a few weeks ago, the Engineering Director at E-Tech International, Bill Powers, provided information related to the critical state of the Camisea Project pipelines. In the following interview, Powers analyzes data from Exponent – a consultancy hired by the InterAmerican Development Bank (IDB), and imparts alternatives to rectify current problems with the Camisea Project.
– What can you tell us about the information E-Tech International has reported about the IDB audits of the Camisea Project?
The information that I bring during this visit to Peru pertains to the technical audit the IDB commissioned to evaluate the Camisea Project pipelines. A consultancy named Exponent, under contract with the IDB, published a report a month ago that corroborates some of the substantive points that E-Tech has been making.
– Can you explain to us what you mean by this study financed by the IDB basically stating what E-Tech has been saying?
Firstly, the Exponent study undertook the issue of the six breaks in the liquids pipeline and has provided us with surprising information. It has allowed us to learn that the liquids pipeline has sufficient thickness to withstand internal pressures, but is too thin to withstand external pressures. There have been six ruptures in the liquids pipeline and the IDB, TGP and Peruvian government have blamed the environment, when the problem is that there was never a sound design. The liquids pipeline is like a porcelain pipeline next to the steel natural gas liquids pipeline, which can at least endure significant external force.
– You also spoke of high levels of corrosion in the pipelines. How true is this?
There is serious internal corrosion in the liquids pipeline. From the beginning we have stated that there is rapid corrosion in the pipelines. The Exponent report underscores this information. There are areas in the pipeline that have lost half their density in only two years. Others have lost up to twenty percent during this same time period. Keeping in mind that the pipeline is designed with a lifetime of thirty years, it is worrying to know that some portions of the pipeline have lost 50 percent of their density in two years. There are portions of the pipeline in the jungle that seem to be in the halfway point of their useful life. Also, TGP chose a very controversial route: mountain peak to mountain peak, without any perceivable study of alternative routes.
– You referenced the limitations of an inspection tool called “intelligent pig,” which supposedly TGP utilized to obtain information on the status of the pipeline. What was the problem with this inspection?
In December of last year, the head of TGP in a conference sponsored by the [Ministry of Energy and Mines] announced that after using the “intelligent pig,” TGP had confirmed that the pipeline was in excellent condition and that the welding was also in perfect condition. However, the Exponent report does not state what we already knew: the intelligent pig is a blind pig when it comes to detecting defects in the circumferential welding. It seems that the head of TGP was trying to assuage the controversy, given that the TGP consortium is asking the IDB for large loan. Surprisingly, the IDB audit, which we all thought would be a tip of the hat, is providing technical details that largely confirm E-Tech statements.
– How do you explain the information in these audits, do they claim everything was in perfect condition?
That’s a good question. I won’t comment on [the IDB’s] Social and Environmental Audit because I have not yet read it. However, in terms o the technical audit, the consultancy was treading thin ice, in that they did not want to upset their client with their interpretation of the data. Despite this, the data is there and speaks for itself. Then comes the interpretation of the results, which has nothing to do with the data in the report. For example, the report states that the thickness of the liquids pipeline is in compliance with the norms, in terms of its internal pressure. Yet it cannot withstand external pressure. And yet the conclusion is: it’s in accordance with the norm for internal pressure.
– So we’re talking about interpretations that are convenient to the client, in this case the IDB?
What is really certain is that there is data that speaks for itself about the gravity of the situation, and yet no one speaks about the bad things.
– In terms of the rapid corrosion process you speak of, the data also supports this?
Correct. That is the data on the portions [of the pipeline] that have lost half their density in two years, which is frightening. However, the consultant has introduced a new norm. This norm states that if a pipeline has not lost eighty percent of its thickness, then all is well and there are no risks. But this doesn’t make sense. A pipeline loses eighty percent of its thickness and its ok? Why? Why construct a thick pipeline if you only need 80 percent of its density? So, you consult the norm? What does it say? It says that if a pipeline has lost eighty percent of its thickness, then you have to stop pipeline, and remove and replace that portion with a new one. That same norm states that if a portion of the pipeline has lost fifty percent of its thickness, then you have six months to stop the pipeline, and remove the portion and replace it. The Exponent report says nothing of this. It simply states that there is a code that says that if the pipeline retains at least 20 percent of its thickness then there is no need for worry.
– In your opinion, what the view of the American government and American people of the Camisea project? Is there a perception that the project is benefiting the country?
No. The Camisea Project does not figure prominently in the American public’s mind. However, people are aware of things in South America and the financial press that follows Camisea in the United States does have a very negative perception [of the project]. To a large extent, what is reported in the news deals with the breaks and controversies. It is only the IDB’s stance, echoing that of TGP and the Peruvian government, that there is no systematic problem and that everything is well and that the weak points are being corrected. Among the IDB, Peruvian government and TGP there is this increasingly weak and increasingly unbelievable attempt to show that all is well.
– What do you think has to happen to burst this illusion that “everything is ok,” and for there to be a real willingness by the Peruvian government to fix all that was done poorly?
What we need is leverage. If the government is not going to demand that the TGP consortium comply with technical requirements, or if the IDB is not going to require that the terms of the condition be met, then the only thing that remains is for us to opt for another independent mechanism that involves the people and that calls on the Peruvian government to demand that laws are complied.
– The audit that the MEM commissioned Germanischer Lloyd to do, could that be the leverage we need?
I don’t know. The conditions under which Germanischer Lloyd won the audit bid are still controversial, given the very low bid. They received the best technical score, despite the low bid, and it simply looked like there was the best intention to follow a transparent process. However, I await the audit. I would like to see it and study it, since it is the only public government product on their point of view.
– How feasible is it to fix all the bad engineering in the Camisea Project?
That problem is that the consortium did not invest in a well-executed and well-designed project from the beginning. This can work, but there has to be significant investment in remediation and continuous monitoring. If the liquids pipeline is fragile, then the geotechnical protections have to be strengthen, and there needs to be more time dedicated to the protection of this pipeline. In terms of the corrosion, the only way to fix this problem without having to remove a large portion of the pipeline, is to monitor it frequently with ‘intelligent pigs’ every six months – verifying if the [corrosion] has deepened. The price that has to be paid for a project that was poorly designed is a high level of monitoring.
[Translated from Spanish original by Amazon Watch]
