April 2021 Vol. 76 No. 4


1970s: Bursting the Pipeline Construction Bubble

75th Anniversary

EDITOR’S NOTE: This article is part of an ongoing series outlining the past several decades of underground infrastructure construction and rehabilitation as seen through the lens of Underground Construction magazine which is celebrating its 75th anniversary in 2021. This month, we review highlights from the 70s. To read about previous decades dating back to the 1940s, please check out our anniversary coverage at UCONonline.com. 

The downward trend that began in 1969 deepened, with U.S. pipeline construction further dropping in 1970 – to 13,534 miles – as a number of contracts were canceled. 

The crunch was also felt at the magazine, where ads for pipeline construction equipment auctions started appearing. 

Still, it was – and is – the third-ranked decade for pipeline construction, and diverse and distinctive projects, technology developments and industry issues/events remained the focus of the magazine. 

Industry trends 

At the beginning of the decade, the focus was on worldwide construction, with companies planning to spend $5.3 billion in 1971 for 23,804 miles – about a third of the projects overseas. 

Two factors expected to help were an easing of the money supply and President Nixon’s decision to allow sharply increased oil imports, thus stimulating further increases in Canadian pipeline capacity delivery. The nation was stunned to learn that domestic oil production had finally peaked – or so was the belief at that time. 

Interestingly, the magazine quoted a federal report, in April 1971, suggesting that by 1995, natural gas consumption in the U.S. would require 58.l trillion cubic feet of gas per year, or 2.5 times the 1970 usage of 21.4 trillion cubic feet. The actual figure in 1995 was 21.4 trillion cubic feet. 

Optimism for the pipeline industry remained in 1972, although figures continued to drop, with just 11,056 miles of pipeline work in 1971. Look at the worldwide potential market, they suggested. Some 65,000 miles of pipe globally could be laid with an investment of $36.5 billion – about 26,000 in the U.S. and Canada – along with 518,265 compressors horsepower with a $14 billion investment. 

Well before the Mideast war of 1973 led to the infamous oil embargo, the magazine cited facts in 1972 for why the nation’s security required it to quickly begin to expand its crude oil and products pipelines. 

The PLCA met in Florida in January 1973 for its 25th annual convention amid more hope that the industry was about to rebound. There was talk of a liquid synthetic gas industry that never developed. 

By 1974, with the nation swimming in Watergate, even Pipeline’s editorials were starting to lose some of their optimism, predicting the tide against government and big business would see little help until after the 1976 elections. 

In fact, in 1975, with construction barely topping the 6,500-mile mark, Pipeline noted that work required a Sherlock Holmes to find. But there was a slight improvement the next year, with 7,300 new transmission miles in the U.S. and Canada. 

Gas shortages in 1977-78, or what later turned out to be perceived shortages, were causing businesses and schools around the country to curtail service or close. Congress soon began to deregulate natural gas prices that would eventually have far-reaching effects for the industry and consumers everywhere. 

Pipeline’s November 1978 issue gave readers a glimpse of the future with the first color-photo spread of a feature story, detailing Colonial Pipeline system’s $310 million expansion. 

By 1979, the second energy crisis of the decade caused prices to soar and disappointing construction levels, again, in the U.S. 

Project progress 

While mostly smaller in size and quantity during the 1970s, projects in the U.S. continued to progress forward and expand in scope. 

A major highlight, for example, was the historic Trans-Alaska Pipeline, eventually known as Alyeska. Proposed in 1970, the 48-inch-diameter, 800-mile-long pipeline to carry crude oil from the North Slope to Prudhoe Bay, was the largest-diameter pipeline for this length. It was also unique for the challenges it posed, including the extreme arctic climate, rugged mountain terrain, earthquake regions and stringent standards to preserve the environment, in addition to opponents’ lawsuits. 

Construction was repeatedly delayed for five years, by environmental issues, but it was significant enough for the magazine to begin featuring in-depth reports on engineering and construction plans in 1972. 

Finally starting in 1975, construction was completed 27 months later on the costliest pipeline project in the world at that time. Even before construction began, in 1974, estimated costs jumped from $900 million to $4 billion; actual costs were nearly $9 billion. 

Also, in 1970 Northern Natural Gas had a $133-million project for 730 miles of line to bring gas supplies in from Canada. Columbia Gas System, El Paso Natural Gas and Transco each had projects in excess of $110 million pending before regulators. 

The magazine’s April 1971 issue described rebuilding of the Grand Canyon’s water system pipeline – required after a disastrous 1967 flood – which was tagged as the most difficult project ever. One of the original contractors, Elling Halvorsen, of Seattle, had broken his back during that calamity and also lost his equipment and working capital. But he was determined to return and did so. 

Explorer Pipeline, a vital 1,400-mile link for refined products supply from the Gulf Coast to the Midwest was completed and began operating in 1972. 

In 1973, El Paso Natural Gas had a number of huge projects on the boards. The magazine also reported the completion of United Gas’ $59-million Sea Robin System expansion – the furthest extension from the shoreline of any project and the first use of 36-inch pipe in the Gulf of Mexico. 

Huge gas pipeline projects from Alaska were planned in 1977, such as the 731-mile, 48-inch Northwest Alaska Pipeline, but sat in limbo waiting for a final ruling on decontrol of prices. The industry now dealt with the Federal Energy Regulatory Commission (FERC) instead of the Federal Power Commission. 

More than $12 billion in new projects, many of them big-inch, were anticipated in 1978, with a number of them being offshoots of the Alaskan line in transporting that oil to Lower 48 destinations. 

The LOOP (Louisiana Offshore Oil Port) project, at an estimated $260 million, also began that year in the Gulf of Mexico and would be the first U.S. deep water port capable of unloading supertankers – a terminal that literally brought the pipeline system to the vessel. 

One result of the 1979 energy crisis was a huge volume of new jobs in the Mideast. Other countries, including Mexico, Argentina and Brazil, sought to cash in on the virtual windfall. Plans called for 30,000 miles of construction at an estimated cost of $13.7 billion. 

Emerging technologies 

Technology innovations made increasingly complex projects of the 1970s possible – and successful – by allowing increases in safety, environmental; performance, reliability and efficiency. 

The coatings realm, for example, saw the development and increasing use of polyethylene tape coatings, extruded polyethylene coatings and fusion-bonded epoxies. 

Also, this decade is when horizontal directional drilling (HDD) became a household name. 

In 1970, Leo Barbera founded American Augers, which started by building hydrostatic drive auger machines with a built-in slip clutch. 

The next year, Martin Cherrington completed the first river crossing (about 500 feet), using HDD, under the Pajaro River to install a 4-inch gas line for Pacific Gas & Electric Co., in Watsonville, Calif. While many considered the project impossible, Cherrington and HDD capabilities completed the underwater bore in one month with only a few difficulties. 

Cherrington’s Titan Contractors continued to complete impressive crossings throughout the decade, including the 1979 largest-diameter crossing ever attempted (at that time) – to install a 40-inch-diameter pipeline in Houston. 

The year 1972 marked by the first major hot oil pipeline system, built to serve two electric generating plants in Maryland. 

In the mid-1970s, improvements to the pipe bending machines of the early 1950s, which were limited to 20-inch diameter, were critical to the Alaska Pipeline’s 48-inch pipe. 

In that same timeframe, Shell Oil received a contract from the Russians to construct a dual 56-inch, 1,300-mile pipeline from Siberia to Eastern Europe and the first successful bending of 60-inch diameter pipe was unveiled place in Tulsa, Okla. 

Personal touch 

Pipeline & Utilities Construction also stayed true to its personal touch during the 1970s, with articles on influential and interesting people. 

On Nov. 1, 1971, H.C. Price Company, celebrated its 50th anniversary. Founded by Harold C. Price Sr. on a $2,500 loan, the company began as Electra Welding Co. in Bartlesville, Okla. Price, a pioneer in electric welding of pipelines, was the ninth president of the PLCA and in 1971, Harold C. Price Jr. became the first second-generation pipeliner to become president of the association. 

In 1973, the magazine marked the 40th anniversary of what is now CRC Crose International, Inc. and reported the Feb. 10 death of Ellis E. Dunn, 67, who began the newsletter some 30 years earlier that formed the genesis of The Pipeliner and today’s Underground Construction magazine. 

The January 1979 issue honored 30 years of service by PLCA Managing Director Richard A. Gump.

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