Pipeline Technology (PT) has served the chemical and petrochemical industry since 1996, delivering safe, efficient and reliable transportation of finished products and feed stocks through specialty pipeline systems.
Tom Orlofsky, managing partner of PT, anticipates a change in the chemical and petrochemical industry, and it’s one that’s in the Louisiana-based company’s favor. “All refined petroleum products and basic chemicals are made to an international standard,” Tom details. “In most cases, the manufacturing and refining process technology is standardized, as well.”
Tom goes on to explain that, over time, the production move to where the supply and logistics of the necessary raw materials is cheapest. “The tidal shift in lower natural gas prices in the United States and the efficiency of transportation is leading to an expansion of chemical and petrochemical manufacturing in the Gulf Coast to a degree not seen in many decades, and we’re in a good position to support it,” he continues.
Pipeline has been providing a trusted alternative for outsourcing construction, ownership and maintenance of pipeline transportation systems since Tom’s father established the firm over 17 years ago. “The company was founded in 1996 by my father, Sy Orlofsky, who has since passed away, and Homer Knost,” recalls Tom. “They met in the 1950s as young men during the construction of the Gulf Interstate Pipeline, a natural pipeline running 845 miles from offshore gathering systems in the Gulf of Mexico to the Kentucky/West Virginia border. My father was the principal engineer and Homer was a subcontractor for the compression stations located in Louisiana.”
After Sy retired from a career in the pipeline industry, he and Homer formed PT as a partnership to develop and own pipelines for the chemical and petrochemical industry clustered along the Mississippi River in Louisiana. Using Homer’s contacts and industrial construction capabilities and Sy’s extensive knowledge of the pipeline industry, the pair had PT up and running by 1996.
Tom is proud to follow in his father’s footsteps. “I earned my engineering degree from Princeton and worked at Bell Labs in Holmdel, N.J., for 19 years,” he says. “When my father passed away in 2001, I stepped into his role as the PT managing partner.”
Location, Location, Location
PT remains based in Louisiana today, with locations in Baton Rouge and Geismar to ensure the company is able to reach an extensive array of clients. According to Tom, Louisiana is home; and there is no better place to be in the pipeline transportation business.
“Louisiana has the densest network of pipeline systems in the U.S. due to the long history of petroleum exploration,” he explains. “It is the petroleum gateway to the Gulf of Mexico. During World War II, petroleum refineries and chemical plants began sprouting up in Louisiana to support the war effort, sharing resources and breeding economic activity in the area. The industrial corridor along the Mississippi River between Baton Rouge and New Orleans is the Silicon Valley of chemical and petrochemical manufacturing.”
With some of the most influential players in the petrochemical industry right in its backyard, PT has secured prime real estate. “The pipeline business is kind of like the real estate business; it’s all about location, location, location,” Tom says. “PT is focused on a particular geographic area; from point A to point B, you need to know the lay of the land, the land owners and the community. After 17 years running, we’re very familiar with all three.”
PT’s roots run deep in Louisiana. “We’re also an affiliate of Arkel International [Arkel], a construction company with more than 50 years of experience in the U.S. and international markets,” notes Tom. “Arkel began building chemical plants in the Baton Rouge area in 1961. In 1996, one of Arkel’s clients asked them to consider owning and financing a chemical plant infrastructure project, which otherwise would not have been built. This was the origin of PT and our unique approach.”
Since the company’s initial relationship with Arkel, PT has constructed over a dozen pipelines in the U.S. The company’s business model provides customers with an alternative to the traditional method of owning and operating proprietary low-return short utility pipelines. By outsourcing pipelines, storage facilities and compressor stations, PT’s clients can focus on the part of business that generates revenue.
“At PT, we focus our full attention on the proper operation and maintenance of these critical assets,” shares Tom. “Our in-house teams of superintendents are highly trained and DOT operator qualified. We stay on top of regulatory compliance and provide 24-hour operational response. All aspects of hazardous pipeline operations are highly regulated, but the applicable regulations are completely unlike the regulations that apply to the chemical manufacturing facility.”
Pipeline transport reduces risk when it comes to hazardous materials, according to Tom. “They have a low incidence of failure and reduce the potential for exposure to employees and the public,” he continues. “PT installs automated leak detection on all of our pipelines. Automated leak detection is not required by regulation.”
Tom is proud to note that PT goes beyond the regulations in this regard. “Less handling and transfer of the product translates to lower opportunity for product contamination,” he continues. “Pipelines use the lowest amount of energy per ton/mile of material moved among all modes of transportation. Obviously it takes less energy to move only the product and not the container.”
As a common carrier of hazardous bulk liquids and gases, PT is able to act as a neutral party among competing manufacturing plants alleviating anti-competitive concerns related to competitive use of proprietary pipelines. “The economics work out best when connecting multiple plants to the pipeline system,” reveals Tom, “Spreading out the fixed costs of pipeline construction, insurance and operations. The pipelines run continually 365 days-per-year and a chemical plant can usually reduce the amount of feedstock inventory both reducing in-process capital requirements and the amount of hazardous material stored on-site.”
Safely, Efficiently from Point A to B
PT has experience constructing and maintaining pipelines that carry products, such as nitric acid, benzene, anhydrous HCL, caustic soda, anhydrous ammonia, hydrogen and brine.
“We current own and maintain a 28,355-footlong, 6-inch diameter 403L-type stainless steel pipeline located in Geismar, La., which serves three different customers,” shares Tom. “The pipeline moves a solution of 65 percent dry nitric acid and 35 percent water used in the manufacturing process of plastic resins. It entered service Dec. 9, 1996, and it’s the only cross-country nitric acid pipeline on the Gulf Coast.”
PT owns and maintains a 37,500-footlong 4-inch diameter carbon steel anhydrous ammonia pipeline system serving four manufacturing plants. “This ammonia system is a classic case of the economic networking effect where a common carrier provides a lower cost service than would have been possible with a proprietary system,” Tom explains.
The company’s Louisiana Aromatix Pipeline spans 115,000 feet from Plaquemine Louisiana to St. Gabriel and crosses the Mississippi River. “This carbon steel pipeline serves two customers and moves benzene,” reveals Tom. “The pipeline was commissioned in October 2008 at capital cost of $16.5 million.”
With proven, long-standing reliability, PT is a trusted pipeline operator. “We did well even during the recent recession, because we are willing to make a 10- to 15-year contractual commitment,” explains Tom. “We do our best to try to understand our customer’s transportation needs and possible sources of their raw materials and bring them opportunities to reduce their logistical costs, because when they grow, we grow.”
Tom foresees a bright future in the Gulf Coast’s petrochemical industry. “The manufacturing of basic chemicals is returning to the Gulf Coast after a long period of shifting to offshore locations with lower energy costs,” he shares. “Once this expansion takes place, companies are going to need utility pipelines to optimize their operations. There’s a historic investment being made here in the Gulf Coast and we’re at the forefront.”
Since 1996, PT’s mission has been, and continues to be, safe, reliable transportation that saves clients time, money and worry. When more chemical manufacturing returns to the Gulf Coast, as Tom predicts, Pipeline Technology will be there to support and sustain operations.