LACT

Trends in LACT Equipment Design and Application

Abstract

During a relatively short period of six years, the method of lease auto-matic custody transfer (LACT) gained universal acceptance, and its use has grown from year to year at a very fast rate. This testifies to the value of the method to both the producing and the transportation branches of the industry.

The design of LACT units has un-dergone considerable evolution during this period with the resulting simpli-fication oj the units and the conse-quent reduction in their investment and maintenance costs. The main eco-nomic advantage of LA CT is the fact that it made possible the present ac-celerated trend toward consolidation oj field oil-storage facilities, with the resulting substantial savings in oper-ating costs. Particularly promising is the arrangement under which the un-treated fluids jrom leases with differ-ent royalty accounts are metered and sampled at the individual leases, and are then commingled and brought to one central treating and LACT facil-ity. While this arrangement at present is limited primarily to unitized fields or to cases where one company owns the whole field or a large portion of the field, there is no reason why it should not find its eventual application also in fields with diversified lease ownership through agreements be-tween the operators jor cooperative surface handling oj oil.

Introduction

Few of the methods used in oil-field operations have gained such a universal acceptance in such a short period of time as the method of lease

Original manuscript received in Society of' Petroleum Engineers office April 2, 1962. Re-viS

designed for the unattended transfer of liquid hydrocarbons from produc-ing leases to the transporting car-r-ier ... ". Because LACT must meet conditions uniquely different from those under which ACT systems are operating, the differentiation between the two methods is important and should be emphasized here.

History of LACT

The first experimental field installa-tion of a LACT unit was made by the Shell Oil Co. in Feb., 1948, in the Antelope field, Tex. Other companies soon joined in this development with field tests of units of their own design. However, it was not until Dec. 22, 1955, that the first routine transfer of custody of oil through an LACT unit took place in this country. The trans-fer was made from the lease of the Gulf Oil Corp. to the Kaw Pipe Line Co. in the Bloomer field, Kans. In Feb., 1958, a nationwide survey con-ducted by the Functional Group on LACT of the API Committee on Crude Oil Measurements determined that 99 LACT units, handling an av-erage of 171,000 BOPD, were at that time in operation in the whole coun-try. This same API group is now in the process of conducting another na-tionwide survey, but the results are not as yet available.

Because no up-to-date figures are available on the extent of LACT use, the experience of one company, Pan American Petroleum Corp., may pro-vide an indication of the trend of this method's acceptance. Pan American was one of three companies who first pioneered the LACT method through developing units of their own design and through field tests. Pan Ameri-can's first routine (not a test, but a routine) custody transfer of oil took place on Nov. 6, 1956, in the South-west Sholem Alechem field, Okla. At that time the company had in opera-tion one LACT unit handling approxi-mately 400 BID. On Jan. 1, 1962, Pan American had in operation a total of 180 LACT units handling 224,400 BID. With the number of other installations already approved or in the process of construction, this figure will be substantially increased by the end of 1962.

The API played an important role in the evolution of the LACT method. Within the API Committee on Crude Oil Measurements there was formed, in Nov., 1952, a group on LACT which at that time consisted of four members. At present this group con-sists of 19 members, representing a large portion of all the major produc-ing and pipeline companies in the United States. In Aug., 1956, this

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group published Bulletin 2509A, "API Bulletin on Lease Automatic Custody Transfer", which helped in disseminat-ing to the industry information on the advantages of the method, and on the design of the LACT systems which then were being used.

Since acceptance of the method grew at a very rapid rate, the group agreed that the time had come for for-mulation of some more specific guides for the industry regarding the design and selection of applicable equipment. On the other hand, they realized that it was stilI too early for formulation of a rigid program of standardization because of the extremely rapid evolu-tion of the equipment used in LACT and because of the many innovations which were being made in this equip-ment on practically a monthly basis. The compromise agreed upon resulted in the preparation of a general stand-ard which primarily consisted of (1) recognizing LACT as an accepted method of custody transfer and (2 ) outlining certain basic principles un-derlying the method. This standard was included in the API Standard 2500 "On Measuring, Sampling and Testing of Crude Oil", the last edition of which was published in March, 1961. Standard 2500 is revised only once every five years. For all the de-tails of design, therefore, reference is made in this standard to the API Bul-eltin 2502, "API Recommended Prac-tice for Lease Automatic Custody Transfer", which was published by the API on Dec. 31, 1961. The bulletin of recommended practice can be re-vised whenever need arises.

The LACT method gained accept-ance because, in many cases, it offered opportunity for substantial savings in investment and operating costs. The spectacular growth of this acceptance has resulted from the evolution of the equipment design and of the manner of the method's application.

Evolution of Design

The LACT method has been devel-oped and pioneered by the producing branch of the oil industry. It is under-standable, therefore, that the original LACT units were of the measuring-tank type. The producer was accus-tomed through years of usage to determining in the tanks the volume of oil being transferred to the pipe-lines. To gain the producers' accept-ance of the method, the designers of the first units employed measuring tanks in which a predetermined vol-ume of oil could be accurately isol-ated. As the tank was filled to its design volume, the fill line to the tank was closed and the contents of the tank dumped into the pipeline system.

By counting the number of dumps, the total volume delivered during any given period of time was determined.

The manner of obtaining the same volume of oil in the measuring tank for each dump varied in different de-signs. One was the weir-to-weir type (Fig. 1). The volume of a dump was determined by the top edges of the upper and lower weirs, utilizing floats located in the weir compartments. The floats actuated the fill line and the pipeline connection valves, with ap-propriate time delays being built in. Another method (Fig. 2) utilized floats in the restricted areas of the tank for control of the volume. Even large errors in position of the float in the restricted area resulted in only a negligible error for the whole volume of the measuring tank. Still another method (Fig. 3) involved the so-called valve-to-valve principle, in which the volume of the dump was measured between the two valves. The floats served only as a means of clos-ing and opening the valves. There were several combinations of these arrangements, one being the valve-to-weir combination (Fig. 4). Figs. 3 and 4 also show a later development, the use of the so-called "sump tank" below the measuring tank, which con-verted the batch-type method of deliv-ery into a continuous one.

As time went on, the pipeline com-panies became interested in LACT, realizing the advantages which would accrue to them from this method. Among these advantages would be in-creased accuracy of measurements, better utilization of labor, the oppor-tunity for better scheduling of runs which would improve the load factor of pipeline facilities, and elimination, to a large extent, of the incrustation

Fig. I-Dump-type measuring tank, conventional floats.

~MEASURED E _ UNMEASURED

Fig. 2-Dump-type measuring tank, restricted-area float.

JOURNAL OF PETROLEUM TECHNOLOGY

problems. In contrast to the producer, the pipelines were accustomed to us-ing the positive-displacement meters .for determining the volume of oil being transferred. They had the "know-how" of properly maintaining the meters, and they had confidence in the meters' accuracy. Since the pipeline has, in effect, the last word in accepting the LACT unit, the trend started away from the measur-ing-tank toward the positive-displace-ment-meter units. This trend was accelerated by the fact that, ad-mittedly, the positive-displacement-meter unit was less cumbersome, more compact and less expensive than the measuring-tank unit. Although there are still many who feel that the measuring-tank unit has definite ad-vantages over the positive-displace-ment-meter type (one being the fact that the measuring-tank unit does not have to be proved periodically), the fact remains that at present the pre-dominant majority of LACT units in operation are of the positive-displace-ment-meter type.

The original LACT units were cus-tom-built. Many changes had to be made, and each unit probably was rebuilt several times. They also had a rather elaborate system of checks. As previously stated, at the point of cus-tody transfer there are many interests involved, and extreme accuracy is needed. Therefore, early designers of the units provided elaborate instru-mentation to assure this accuracy. In the case of Pan American's first unit,

~MEASURED _UNMEASURED

PIPELINE SUMP

Fig. 3--JDump-type measuring tank, valve-to-valve measurement.

PIPELINE SUMP

~MEASURED _UNMEASURED

Fig. 4-Dump-type measuring tank, valve-to-weir measurement.

NOVEMBER, 1962

for instance, there were four separate checks on the number of dumps made hy the unit. As the numher of LACT units in operation increased and as they started proving themselves to be accurate and dependable, confidence grew. Gradually, the instrumentation of the units became less complex, which reduced the investment and the maintenance costs. Some of the early custom-made units cost in excess of $20,000 (Fig. 5), whereas the price of a modem positive-displacement-meter unit ranges from $4,000 to $7,000, depending on the design and capacity.

The trend toward simplification of LACT units continues. An example of an extremely simple unit, located in a field in Alberta, Canada, is shown in Fig. 6. In this particular field, no water is produced and the oil is sold on a flat price basis. Therefore, there is no need for a BS&W monitor or sampler. The gas-oil ratio is extremely low so there is no need for a deaera-tor ahead of the meter, and the unit is simply a positive-displacement meter with an arrangement for the proving loop. Admittedly, this type of condi-tion does not occur frequently. How-ever, the unit is a good indication of the progress made since the early days when LACT was first employed.

One new development is a unit specifically designed for leases with small production up to 50 BID, for which a conventional LACT unit could not be economically justified. The unit, developed by the Sinclair Oil and Gas Co., has been designed on the premise that the standards of accuracy required are relative and depend, among other factors, on the amount of oil being handled by the unit. Obviously, a higher per cent of error would be permissible in a unit handling 50 BID than in one han-dling 5,000 BID. Every effort has been directed toward keeping down the cost of the unit (Fig. 7). An ordi-nary water meter is used for measur-

Fig. 5-An early type of LACT unit.

ing the volume. On installations made to date, meter-proving tests on the water meter have shown accuracies to be well within desired limits and even comparable to accuracies obtained with more expensive meters. The mon-itor is a capacitance probe with highly simplified circuitry. No "start" and "stop" level switches are used in the surge tank. Each LACT transfer cycle is initiated by a timer. Within each cycle the oil is first circulated from the surge tank to treating facilities and back. When the oil is cleaned, it is delivered to the pipeline. The cycle is completed by a low-pressure switch in the suction of the delivery pump. The whole unit sells for approximately $1,200.

The design simplifications and re-duced costs of the LACT unit have been important factors contributing toward the rapid growth of the meth-od's acceptance.

Evolution of Application

As originally conceived, the LACT unit was simply a replacement for an individual conventional tank battery. It offered a high level of accuracy in measurements and substantial savings in the handling of records resulting from the custody-transfer. This saving was not limited to the immediate han-dling of records at the field location, but also included the handling of rec-ords by the other offices involved. In this type of application, the LACT unit was difficult to justify economic-ally except in two cases: (1) in the case of a new field, and (2) in the case of a battery in which tanks were in a poor state of repair and would

Fig.6-The imple t form of LACf unit.

Fig. 7~LACT unit for handling up to '50 BOPD.

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have had to be replaced. This was true even after improvements in design substantially reduced the cost of units. In these two cases, savings on the ini-tial investment alone made LACT quite attractive.

This saving in investment com-pared to the conventional tankage is clearly illustrated by Fig. 8, which shows a Wyoming field tank battery which was replaced by a LACT unit. The battery consisted of 12,000 bbl of storage. After the unit was installed, all except two tanks were surplus.

A new impetus toward increased acceptance of LACT was brought about by the combining of this method with consolidation of tank battery fac-ilities. To be exact, it would be more appropriate to say that LACT made possible the present trend toward con-solidation of individual tank batteries. Bringing production to one or more points of a field from a number of leases which were previously equipped with individual tank batteries obvious-ly should result in a savings in oper-ating costs. From the investment point of view, however, such consolidation would not offer much advantage if the central point or points would have to be equipped with the steel storage required for conventional methods of custody transfer. In effect, this type of consolidation would mean moving of tanks and of other tank-battery equipment from several separate loca-tions to one point. With LACT fur-nishing a means of continuous deliv-ery of oil to the pipeline, subject only to appropriate scheduling of runs by the pipeline carrier, consolidation of batteries with LACT eliminated the need for the storage at the central point, except for the surge tank and one or more emergency storage tanks.

This type of consolidation has been an accepted practice for several years and is used in a number of different arrangements. In some cases, the treating and testing facilities are left at the original batteries. Tanks, except for emergency storage, are removed

and treated oil is brought to the cen-tral LACT point. In other cases the testing facilities of several original tank batteries are moved together to a point sometimes refenoo to as a "lease station" or a "satellite battery" (Fig. 9). From these lease stations, oil is directed to the central battery to which the treaters from the individual leases have been moved. In each case the clean oil from each lease is me-tered, and the combined stream is transferred through LACT to the pipe-line. At the end of each run period, the difference between the LACT runs and the sum of the metered vol-umes is prorated among the leases. The effect of such a consolidation on the amount of needed equipment is shown in Table 1.

The next step in evolution in the manner of application of LACT was commingling of untreated fluids from leases with different royalty accounts, and bringing the commingled fluid to one central treating and LACT facil-ity. This is a relatively new approach and one that promises a far-reaching effect on methods of operation of oil producing leases. Under such an ar-rangement, the oil is metered and sam-pled at the previous tank-battery loca-tions. The commingled fluids are brought to one or two central treaters. The clean oil is handled by LACT. At the end of the run period, usually once a month, the LACT runs are compared with the sum total of the runs of the metered volumes from dif-ferent leases, and the difference is assigned to the leases on the basis of metered volumes and of the samples showing the volume of free water and emulsion produced by each lease. The method offers an opportunity for sub-stantial investment and operating sav-ings. Comparison between the amounts of money involved in consolidation of batteries and metering of oil from individual leases after it is treated vs commingling and treating the com-mingled fluid in one central station is shown in Table 2.

Fig. 8-Replacement of a tank battery by a LACT unit (shown on the left).

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TABLE I-RESULTS OF BATTERY CON~OLlDATION AND INSTALLATION OF LACT IN A FIELD

WeilL .. , ... Tank BaUeries __ _ Tanks __ ... Treoters. ___ .. _ Separators __ _

IN NEBRASKA Number Before

78 14 98

176 It 7~metering

Number :o\ft.r

78 1 2

310 It 9~metering

:, production

Discussion so far has dealt with conversion of the existing facilities to those utilizing LACT. In many cases economics have to be worked out very carefully to determine whether or not such a conversion can be econ-omically justified. In the case of a new field, the approach is much sim-pler because there is no question of the savings involved. Formerly, one of the problems in using LACT for a new field was the fact that, after the discovery well was drilled and stor-age facilities were provided for each of the step-out wells which were drilled to define the field, additional tankage had to be provided for each new well. By the time the field was outlined, there were so many tank bat-teries in operation that the problem resolved itself again into that of con-solidation of existing facilities.

Under the new approach, when a discovery well is brought in storage is erected at the well and oil is trucked to the pipeline terminal. As the out-post wells are being completed, skid-mounted test units (such as, for in-stance, the one shown in Fig. 10) are installed at these wells. Temporary

TYPICAL CENTRAL LACT BATTERY

Fig. 9-Consolidation and LACT.

Fig. IO-A skid-mounted test unit.

JOURNAL OF PETROLEUM TECH;\"OLOGY

lines bring the oil to the storage at the discovery well. After development of the field reaches the point at which bringing in of the pipeline is justified, the most satisfactory location for a central LACT and treating station is selected by joint planning of the pro-ducer and the pipeline company. Skid-mounted test units are moved from the individual wells to the prese-lected locations for the "lease stations", and permanent lines are installed. To illustrate the savings involved, in the case of a hypothetical field with 20,000 productive acres, 125 wells and 100 BOPD/well allowable, the conventional storage and custody-transfer facilities would cost approxi-mately $920,000. With preplanned consolidation, with 15 lease stations, two central LACT units and the treat-ing stations, the cost would be around $550,000.

Future Trends So far this discussion has dealt with

development of the LACT method from its inception to the present. Now consideration should be given to what can be expected from the future.

One of the factors which did re-tard the acceptance of the LACT method, because it slowed down the lowering of the cost of LACT units, was a lack of standardization of the equipment involved in the units. The evolution of the method was rapid, and the individuals in the different companies who were assigned to de-sign LACT installations had definite ideas about components of the units. Some of the manufacturers made at-tempts to provide standard units; how-ever, by the time the changes had been made to comply with the indi-vidual requests, each of the units be-came, in effect, custom-built-and therefore expensive.

Fortunately, this phase of develop-ment is nearing its end. More and more companies are developing their own standard specifications for LACT units, and go out for bids in acquiring the units. As this trend continues, greater uniformity will be developed and, eventually, working out of API standards will be made possible.

There is one phase of LACT which still needs improvement. This is sam-pling and analyzing the composite sample to determine the BS&W con-tent and the gravity of the sample.

The evolution of LACY was so rapid that, as an expedient, the sampling methods used in conventional custody transfer were adapted to the LACT method. This introduced problems. It is felt that the samplers now available furnish a r@asonably representative sample, that is, a sample which can be considered as representative under the field conditions and for the pur-poses intended. The testing of the composite sample, however, still pre-sents a problem for some cases.

As far as BS&W determination is concerned, it should be realized that the sample is stored over an extended period of time, sometimes for weeks, before it is analyzed. Free water which does settle out of the sample is very difficult to re-emulsify, even by means of electric stirrers. Therefore, determination of the BS&W is diffi-cult. Several approaches are being used to solve the problem. One is an arrangement under which the whole sample can be visually inspected and the percentage of free water and emulsion determined. The second ap-proach consists of adding certain chemical compounds which re-suspend the water for a short period of time so that the BS&W content can be de-termined by the conventional meth-ods. A new development involves samplers which, in effect, are equipped with small treaters and permit direct determination of BS&W.

Those who are dealing with this problem agree that the ultimate solu-tion for determining the BS&W con-tent is through recording and inte-grating capacitance-type instruments. These instruments are already avail-able and are used in some installa-tions. The problem is one of econom-ics; the instruments are quite expen-sive. When further development re-duces the cost of these instruments, the analysis of the mechanical sample for BS&W content will be unnecessary.

Equally important is the problem of determining the gravity. Some ir-regularities have been noted in de-termining the gravity of the com-posite sample. In a great majority of cases, the difficulties have been elim-inated by anyone or all of the follow-ing: (1) maintaining the composite sample in a container under pressure, (2) training the field personnel for proper removal of the sample for the purpose of gravity determination or

TABLE 2-COMMINGLING WITH LACT.METERING BEFORE AND AFTER TREATING (FIVE LEASES, TOTAL PRODUCTION = 2,500 BOPD, LOW WATERCUT)

Treaters _

Separators Meters and Samplers _ LACT ....

NOVEMBER, 1962

After Treating No., Size 6-6 ft

........... 5 .......... 1

Cost $14,620

2,750 5,500

Metering

$42,870 Saving = $15,795, or 36 per cent

IBefore Tre~H;" No., Size 1 - 10ft 1- 4ft 5-21;' ft 5 1

lCost

$ 9,225 4,600

~ 000 2,750 5,500

$27,075

determining the gravity in pressure hydrometers, and (3) taking into con-sideration the temperature under which the oil is being run to the LACT unit. The whole question of gravity determination is quite com-plex, and many individuals and or-ganizations are working on it.

The trend toward consolidation of the treating and LACT facilities will have one effect. The rapidly rising curve of the number of LACT units in use will flatten out. However, the number of barrels handled by the units will continue to increase in the future. To illustrate, about four or five years ago first consideration was given to use of LACT in one of the large fields of Pan American Petroleum Corp. in the Texas Gulf Coast. The field consists of 84 leases and has 88 tank batteries. At that time, individual LACT units for each of the batteries were considered and the cost, of course, was prohibitive. Later, in the course of studies, different types of consolidation were considered. The present plan, which is in process of being executed, involves the use of one LACT unit for all 84 leases.

There is no question that an in-crease can be expected in the use of LACT in conjunction with consolida-tion of custody-transfer facilities and of commingling untreated fluids from leases with different royalty accounts. There is no reason why this approach should be limited only to the fields owned by one operator or to unitized fields. It is entirely feasible that a day will come when different operators of a field with a highly diversified owner-ship will arrive at a cooperative agree-ment as far as surface handling of oil and custody transfer are concerned. A central treating and LACT facility would be installed for the whole field, with one of the operators handling the installation on behalf of all the oper-ators. The magnitude of operating savings which would be achieved with such an approach is apparent. The present economic situation of the do-mestic oil industry, dictating the need for drastic reduction of operating ex-penses, makes the probability of such arrangements quite feasible.

LACT is only one phase of auto-mation of oil producing leases. To-gether with other phases such as, for instance, automatic well testing and control, LACT will continue to pass through different steps of refinements, leading eventually to the stage at which field information will be trans-mitted to a remote office in a form directly usable in data-processing machines. *** EDITOR'S NOTE: A PICTURE AND BIO-GRAPHICAL SKETCH OF JOSEPH ZABA APPEAR ON PAGE 1248.

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