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David Phin - Paragon Inspection

Correcting the connectors…

David Phin - Paragon Inspection

Correcting the connectors

The losses are spectacular – and so are the maintenance costs. Every year, the UK north sea oil and gas industry loses nearly $5 billion because of leaks, and spends a fortune checking pipes (including small bore tubing) on rigs where the leaks are most likely to happen. But what if you could speed up inspection, reduce costs and prevent leaks before they occur? David Phin of Paragon Inspection thinks he has the answer...

He may not be Superman, but David Phin, the CEO of Paragon Inspection, may be able to prevent environmental and financial disaster by using X-ray vision to inspect the pipes on oil rigs. His solution could also reduce the time it takes for an inspection from several hours to a matter of seconds, without the need to go through a total of 50 procedures, including shutting down production, isolating and purging the system, disassembly, visual inspection, reassembly and pressure tests – saving companies hundreds of millions of dollars a year and slashing the number of people required.

Every year in the North Sea alone, over 12 million barrels of oil are lost due to leaks from small bore tubing (SBT), costing the industry nearly $1 billion. In the North Sea, there are 186 oil and gas assets, out of a total of over 1,300 worldwide, and global losses from SBT leaks are now approaching $7 billion a year.

With 150,000 connectors on each rig, it's no surprise that accidents will happen, and many leaks are caused by human error when assembling the pipes.

“There are 13 different ways to wrongly connect them and only one way to do it right,” Phin explains. And when something goes wrong, it can go very wrong – millions of dollars per day can be lost due to shutdowns and it can take days to find the leak, fix the system and restart production.

The SBTs themselves may be perfectly sound when they land on the platform but when they are assembled, there is always potential for error – industry estimates suggest that up to 26% of assemblies are not done correctly. Other causes of “integrity failure” are vibration fatigue, as well as poor inspection and maintenance programmes. In addition, because the SBTs must be randomly inspected on a regular basis to meet health and safety requirements, new problems may be created if they're reassembled incorrectly. Offshore inspection costs can also be a drain on resources, due to a lack of economical solutions and trained personnel: “It costs 19 times as much to send people offshore,” says Phin, “compared to having the inspection technology and trained people there on the spot all the time.”

According to Phin, SBT assemblies have been a problem since they were first introduced over 30 years ago. “There is no means of verification,” he says, “and the industry now recognises the scale of the problem.” Over the last three years, 5,000 people have been trained to work with SBT. “But they don't have the right tools for assembly and checking,” adds Phin, “and inspection costs in the UK alone can be as high as £400,000 a year per asset.” And that’s why Phin believes his new inspection solution is a “no brainer” product that may become industry standard.

The Paragon solution

Phin’s new solution is a digital inspection technology called OLEG™ (on-site low energy gauging), designed to transform the inspection of small bore tubing by reducing hydrocarbon leaks and “associated human factors,” thus reducing risk and downtime and increasing reliability by detecting problems before leaks occur. As well as making it easy to check the assemblies, the system guides the user through the process by uploading information to a database, and not only assesses the current integrity of SBTs but also predicts future problems.

The OLEG system consists of two different tools – an integrity assessment tool scheduled for launch in July 2019 and a handheld X-ray tool which should reach the market in early 2020. The X-ray tool is patented in the UK and both tools have various international patents pending.

As well as checking connections to see if they are tightened correctly (if they're too tight, they may crack, and if they're too loose, they may leak) and checking for correct internal fitment, the future OLEG system tools will be readable by a mobile app, uploading data to a database and thus reducing inspection time by 50%.

The new X-ray tool can check the internal integrity of the connectors without pulling the tubing apart, and without all the safety procedures required by conventional X-rays – the low energy used is contained inside a compact handheld device. In addition, the results of the scan can be seen in a matter of seconds, without the need to process any film and interpret the images. All you need to do is pull the trigger and the scan is complete.

“Our solution makes it possible to verify the integrity of SBTs and rate the competency of assembly,” says Phin. “We also plan to offer a solution for follow-on system visibility, rating competency and recording the data relating to all SBT assemblies throughout their life-cycle, including who did what, when and where.” The system is also designed to manage the risks related to legacy assemblies, as well as risk and predictive analysis for new installations.

The fitting assessment tool will be piloted later this year. “The next step is to find a partner and start field trials to refine the design and further prove reliability,” says Phin. In the initial stages, Phin will send out his own operators, who will not only be ambassadors for Paragon but will also provide him with valuable feedback on how the solution is working and how to improve it. Phin says more development is needed before the new scanner is ready for market. It has passed the proof-of-concept stage, but the prototype still requires additional testing, as well as industry approval.

The road to investment

Paragon Inspection was one of the first companies to be selected for the TechX Pioneers Programme set up by the Oil & Gas Technology Centre in Aberdeen, competing with 120 ideas from 24 countries. The programme is designed to accelerate innovation in the oil and gas industry, and this included funding of £100,000, plus mentoring and business training.

Phin was also chosen last year for an RSE Unlocking Ambition Fellowship, which brought in a further £45,000, as well as “expert support and guidance” through the Entrepreneur Business School training programme – how to raise investment, build a team and progress from start-up to scale-up. As a result, Phin is busy putting the finishing touches to his business plan and starting to look for investors.

On a journey

Phin has over 30 years’ experience in the oil and gas industry, aerospace and power generation, specialising in resolving inspection and quality issues and developing bespoke inspection methods , as well as training other inspectors. For the last 12 years, he’s worked as a consultant, suggesting solutions to clients, but now he’s on a journey to develop and commercialise a system which could be adopted across a range of industries, initially focusing on oil and gas.

The Dundee-based entrepreneur founded Paragon seven years ago, and he’s used his earnings as a consultant to fund the development of his new system over the last 18 months. “The hard part for me was that over the short term, I felt as if I was running at a different speed from everyone else, in the race to develop the system,” he says.

“One of the things I have learned,” he continues, “is to understand what you don’t know, and how to bring in expertise where and when it is needed. For example, I have one person helping develop the product and another who is focused on the structure of the company and getting ready to scale it – we are planning to build up the team to about 20 people within the next three to five years.”

And what is the best part of building the business? “It’s fantastic to achieve something and see the team and company grow,” he replies. “It’s also great to meet so many interesting people, including potential investors – and the mentors I'm lucky to have.”

Disruptive technology

Interest in the product may come from the fact that it is a disruptive technology which solves a long-standing industry problem. According to Phin, the other factors driving demand will be an increase in regulatory compliance regarding safety and environmental protection in different end-user industries and an increase in industrial process complexity. “The risk associated with it is also increasing,” he explains, “while new health and safety requirements could also drive demand, especially if the relevant authorities adopt the solution as an industry standard practice.” Currently, only about 10% of SBTs are randomly disassembled and inspected every year, but Phin believes his new solution could make a huge difference.

“We are developing a smart, disruptive, patented technology,” Phin declares, “with a vast global market. That’s why I am confident our early investors will see a massive return on their money three to five years from now.”

When Phin was a consultant, he used to think, “If there’s no problem, I don’t have a job.” Nowadays, as he develops the products and builds up his business, his perspective has changed. “I’m on a journey now,” he says, “taking my ideas to the next level, building the business and building the team, and changing the way things are done in the industry. That’s my job now.”


Small bore tubing: the facts

• There are 45 million small bore tubing (SBT) assemblies in the UK North Sea

• 26% are installed incorrectly

• 20% of reported hydrocarbon leaks offshore are related to SBT assemblies

• 11% of these leaks are classified as “major severity events”

• 130 million small bore connectors are produced globally every year for use in many industries, including nuclear, power generation, shipping and transport

• The global oil and gas instrumentation market was valued at $5.4 billion in 2016 and is projected to be worth over $8 billion by 2021

• The global asset integrity management systems market was valued at $15 billion in 2016 and is expected to reach $23 billion by 2021

Visit: Paragon Inspection






"David Phin - Paragon Inspection". Science Scotland (Issue Twenty-three)
Printed from on 03/07/20 11:19:41 PM

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