Introduction:
Pipeline is majorly used for transportation of liquids, gases and fluids over a long distance. More so, any chemically stable substance can be sent through a pipeline.
Pipelines exists for the transportation of crude and refined petrol; fuels such as mineral oil, natural gas and biofuels and other fluids including sewage, slurry, water and beer. Pipelines are also useful for transportation of water for drinking or irrigation over long distances when it needs to move over hills or where canal or channels are poor choices due to evaporation, pollution or environmental impact.
History of Oil Pipeline:
It is uncertain when the first crude oil pipeline was built. However, there are indications that Vladmir Shukhov and the Branobel Company in the late 19th century and the Oil Transport Association constructed a 2inch (51mm) wrought iron pipeline over a 6 mile (9.7km) from an oil field in Pennsylvania to a railroad station in Oil Creek in the 1860’s.
Oil pipelines are made from steel or plastic tubes with inner diameter typically from 4-48 inches (100 to 1,220 mm) which are usually buried at a depth of about 3 to 6 feet (0.91 to 1.83m). To protect pipes from impact, abrasion and corrosion, a variety of materials are used which include wood lagging (wood slats), concrete coating, rockshield, high density polyethylene, imported sand padding and padding machines. The oil is moved through the pipelines by pump stations along the pipeline. Natural gas pipelines are constructed of carbon steel.
What is an Oil Pipeline?
A pipeline is a long pipe used ordinarily to transport petroleum products or gas from the point of mining to a storage tank. It does not float. It is either laid underground or on the floor of the sea. It does not form part of the storage facility but it is rather independent of the storage facility. It does not have a hull. (A hull is the shell or outer casting and internal structure below the main deck of a vessel which provide both the floatation envelope and structural integrity to the vessel in its normal operation. All maritime vessels have floatation capabilities).
The Oil Pipeline Act CAP O7, Laws of the Federation of Nigeria, 2004 at section 7 provides for licences to be granted for the establishment and maintenance of pipelines incidental and supplementary to oil fields and oil mining and for purposes ancillary to such pipelines.
Section 7 (1) of the Oil Pipelines Act states:
“The holder of a permit to survey may make an application to the Minister in accordance with the provisions of this Act and of any regulations made thereunder for the grant of an oil pipeline licence in respect of any oil pipeline the survey of the route for which has been completed by the applicant.”
In section 11 (2) of the Act, Oil Pipeline is defined thus:
“an oil pipeline means a pipeline for the conveyance of mineral oils, natural gas and any of their derivatives or components, and also any substance (including steam and water) used or intended to be used in the production or refining or conveying of mineral oils, natural gas, and any of their derivatives or components”.
From the foregoing, it has been established that an oil pipeline is for transportation of mineral oil, natural gas and any of their derivatives or components from one oil terminal to a platform but a pipeline cannot navigate across water however propelled. In fact, when attached to a terminal it cannot navigate when detached it cannot still navigate. The fact that it is an appendage to a platform or terminal does not ascribe any non-conventional structure to its original structure to transform it to a vessel. It remains a pipeline that carries crude oil or its derivatives. It cannot move in water to fall within the criterion of a ship or vessel that can navigate in water.
It is important to note that an oil pipeline is not a storage facility. By virtue of section 22(5) of the Coastal and Inland Shipping (Cabotage) Act, 2003 which includes in the list of vessels eligible for registration under the Act, floating petroleum storage and tankers. However, a pipeline is not a petroleum storage either floating or tethered nor is it a petroleum tanker. While a pipeline may be used to transport oil or gas to floating petroleum storage or a tanker, the pipeline is not an integral part of any of such vessel.
It is also imperative to point out that an oil terminal is different from an oil platform. The major conveying instrument from both is an oil pipeline. Under section 7(3) of Oil Terminal Dues Act, an oil terminal is an oil-loading terminal, pumping booster station, or other installation or structure associated with a terminal including its storage facilities, other than a terminal situated within a port or any approaches thereto. Section 7(2) of the Act, however prescribes that every oil terminal and the area within where the terminal situates shall be established geographical area with precise co-ordinates. Thus, an oil terminal cannot navigate or move outside its geographical area. A platform, on the other hand, is a large structure used to house workers and machinery. It may be fixed to the ocean floor or may float.
Advantages:
Pipelines are generally the most economical way to transport large quantities of oil, refined oil products, natural gas, mineral oil, liquids and fluids such as water, milk, beer and steam over land or under sea to long distances.
Disadvantages:
Pipelines can be the target of vandalism, sabotage, bunkering, siphoning or even terrorist attacks. In war, pipelines are often the target of military attacks.
Also, due to lack of maintenance oil pipelines can rupture, fracture and spew its entire contents into surrounding streams, river and vegetation. See the case of Centre for Oil Pollution Watch v. NNPC (2019) 5 NWLR (Pt. 1666) 518.
Remedies for action against oil spillage through pipeline explosion, and rupture:
The courts have held in Nigerian AGIP Oil Company Limited v. Onyemachi Ogbu (2019) 35 W.R.N 132, that an aggrieved person who has approached the court to seek redress in an action for oil spillage must comply strictly with the provisions of the Oil Pipelines Act and the claim must be for compensation and not damages or any other relief.
Conclusion:
When a pipeline is built, the construction project not only covers the civil engineering work to laying the pipeline and build the pump or compressor stations, it also has to cover all the work related to the installation of the field devices that will support remote operation.
The pipeline is routed along what is known as a “right of way”. Pipelines are generally developed and built using the following stages:
- Open season to determine market interest: Potential customers are given the chance to sign up for part of the new pipeline’s capacity rights. This stage lasts up to two months. If interest in the pipeline is limited, the project does not move forward.
- Route or right of way selection: This is the selection or survey of the terrain in which the pipeline project is going to laid or situate.
- Pipeline design: The pipeline project may take a number of forms, including the construction of a new pipeline, conversion of existing pipeline from one fuel type to another or improvements to facilities on a current pipeline route. The design process may take up to six months.
- Obtaining approval: once the design is finalized and the first pipeline customers have purchased their share of capacity, the project must be approved by the relevant regulatory agencies. The process can last up to 18 months, particularly for pipelines that span multiple states.
- Surveying the route: This is carrying out the plan layout and environmental impact assessment of the route where the pipeline is going to be laid. The pipeline project must be contained in a geographical survey or location which can be identified and ascertained.
- Clearing of route: This involves clearing of bushes, installation of beacons or pillars or digging of tramps, trenches or gutters to accommodate the pipelines.
- Installing the pipe: This entails the laying of the pipes either underground, under seas or mounting the pipes on concrete slabs or iron poles.
- Installing valves, intersections, joints, pumps and sub-stations.
- Covering the pipe and trench.
- Testing: once construction is completed, the new pipeline is subjected to tests to ensure its structural integrity. These may include hydrostatic testing and line packing.
Routine maintenance of pipelines and its facilities are always encouraged as there may be leaks due to rupture and sabotage of the pipeline to militate against spill and environmental hazards. See the case of Mobil Producing Nigeria Unlimited v. His Royal Highness Oba Yunusa A. Ayeni & 6 Ors (2010) 4 NWLR (Pt.1185) 586.
For further legal assistance on property and real estate transactions, do not hesitate to contact the author:
Kingsley Izimah, Esq.
Principal Partner,
Nomos Legal Practice
https://www.nomoslegalpractice.com
+234 (0) 806-809-5282
+234 (0) 805-101-9362
