Memphis Int'l Finances Fuel Farm Upgrades

Author: 
Dan Vnuk
Published in: 
July-August
2014

Airport officials expect crews to finish an $8 million fuel facility initiative at Memphis International (MEM) by the end of summer. The project is designed to ensure an ample, reliable fuel supply for the Tennessee airport that accommodates more than 6 million annual passengers and serves as a hub for Delta Air Lines.

Averaging 80 flights per day, Delta is MEM's largest carrier and head of its airline consortium. When the Memphis-Shelby County Airport Authority proposed plans to expand and renovate the fuel storage and delivery system at MEM, Delta led consortium members in collaborating to make the project happen.

Scott Brockman, president and chief executive officer of the airport authority, describes the circumstances behind the initiative: "We had a fuel farm that consisted of a number of different operations that had been active over the years and managed by different entities and individuals ... Several tanks were no longer in service, so there was a need to streamline the fuel storage operations.

factsfigures
Project: Fuel Facility Expansion & Renovation
Location: Memphis (TN) Int'l Airport
Owner & Operator: Memphis-Shelby County Airport Authority
Total Cost: $8 million
Funding: Interim financing supplied by airport authority o be repaid by airlines via fuel flowage fees
Construction Timeline: Winter 2012 -
Summer 2014

Project Management

Main Construction Contractor:  KEAR Civil Corp.
Engineering Design Contractor: Pond & Co.
Subcontractors: Southwest Tank & Steel; Southwest Specialty Coatings
Electrical Subcontractor: Mid-South Electric
Project Goals: Expand capacity & streamline operations of fuel storage & delivery system

"At the same time, new EPA guideline discussions were being held with the airlines as to how to bring the facility up to code and meet the new regulations. Delta took the lead and offered to refurbish the main tank, which could provide enough fuel storage for all of our main carriers. Even with the downsizing of Delta operations that had occurred, the airport authority and the carriers realized that we need to provide a reliable supply of fuel to maintain a reliable level of service. All of the signatory airlines - those that signed on to the airport lease - also signed the consortium agreement to purchase fuel and reduce the facility's debt at the same time."

With the airport board "on a mission" to protect fueling operations, the authority provided interim financing to the airline consortium during the project's design and construction phases, Brockman explains. The airlines will then repay the cost of the project through fuel flowage fees. 

The primary hub for FedEx Corp. is also located at MEM; but the cargo giant does not belong to the airline consortium involved with current fuel farm project. FedEx receives its fuel from a separate off-airport facility. 

Brockman notes that the timing of the fuel farm project was perfect, as the airport was able to combine it with a major ramp renovation and hydrant replacement effort, thus maximizing construction efficiency and minimizing operational disruption.  "We're replacing 40+ year-old pavement that's beyond its useful life and was costing more to maintain than its value as an asset," he explains.

Anatomy of the Upgrade

Capacity was just one of the factors considered during the fuel farm project. Meeting Air Transport Association of America (ATA) standards, specifying the proper tank coatings, and complying with EPA and fire protection requirements were also key. Spill containment plans, for instance, included measures to address existing contaminated soil. And water treatment systems were upgraded to remove fuel and other contaminants from the wastewater stream, thus eliminating the cost of disposing petroleum contact water from the airport.

KEAR Civil Corp. headed construction efforts for the project. The existing fuel farm included three 5,000-barrel tanks referred to as Delta tanks 1, 2 and 3; plus two 10,000-barrel tanks known as MEM tanks 1 and 2.  The scope of work was based on making Delta Tank 3 comply with current codes and boosting operating parameters required by the new and existing fueling systems.  (The existing fueling system previously operated off the fuel capacity in MEM tanks 1 and 2 only. The three Delta tanks were inoperable when construction began.)

Extensive modifications were required for Tank 3 to meet current ATA 103 standards and subsequently come online. Southwest Tank & Steel, a KEAR subcontractor, facilitated the modifications by upgrading mechanical and electrical components, which required the installation of all new mechanical piping ranging in sizes from 2 to 20 inches. The company also connected MEM tanks 1 and 2 with the newly upgraded Delta Tank 3. According to KEAR, the new piping that connects the three storage tanks provides end-users with the flexibility and safety features to fully operate the fuel system between all three tanks while ensuring that the necessary fuel capacity is available at all times.

New Water Treatment System

While upgrading MEM's fuel farm, KEAR also installed a new water treatment system. "The Memphis area is prone to significant rainfalls, which creates a large capacity of ground and rain water," explains KEAR President Mike Fossett. "The water treatment system is equipped to handle large volumes of rainfall and will safely extract any residual fuel that can be present. The water is stored in an underground storage tank until it reaches a set level, and is then pumped through an oil/water separator (OWS). The OWS is used to separate any residual fuel from the water, dispose of the wasted fuel, and return the clean water back through the storm drainage system." 

Fossett credits the company's subcontractors - Southwest Tank & Steel, Southwest Specialty Coatings and Mid-South Electric to name a few - for providing "exceptional service" and helping KEAR meet its schedule and budget targets. 

Analyzing the Options

Pond & Co. managed the engineering design services and evaluated various fuel supply logistics, storage and distribution options as a parallel project to replacing the airport's parking apron. The apron project included the airport authority's plans to expand and upgrade the hydrant system to service all gate positions.

Pond personnel considered several ways to feed the hydrant system - including a new pipeline supply and new off-site tank storage and - before recommending that the existing tanks be expanded and renovated. Anticipated fuel demand, on-site storage capacity and cost projections for the various alternatives were analyzed to determine the final recommendation, which was subsequently selected by the airlines and airport authority. Pond was then selected to perform integrity assessments and corrosion engineering studies to ensure the physical integrity of the system components.
 
Upon completing the integrity studies, Pond designed upgrades that allow the existing facilities to comply with EPA's Spill Prevention, Control and Countermeasures regulations (40 CFR 112), ATA Standard 103 and other applicable codes and standards, while also expanding the capacity of the fuel facility to better satisfy fuel demand for the future.

"At the outset, the scope of the project was divided into two phases: assessment and design development," says J. Dean Flessas, vice-president, Pond & Co. "Assessment included American Petroleum Institute (API) 653 tank inspections and API 570 pipeline inspections to assess the integrity of the existing systems and develop specific recommendations for repair and/or upgrade to ensure the mechanical integrity of the tanks and piping. Recommendations made were based upon maintaining the existing infrastructure wherever possible.

"The design development was based on the findings of the assessments along within a code compliance review. Pond engineers next developed plans and specifications for completion of the upgrades to the fuel facility."

Primary elements included upgrading the 5,000-barrel return tank 3 to comply with ATA 103 standards for interior and exterior coatings and modifying the mechanical/electrical systems required to connect Tank 3 to the operating system.

Secondary containment upgrades needed to meet EPA and National Fire Protection Association requirements included a flexible membrane liner in the tank containment area and spill containment improvements for truck loading/off-loading areas. Finally, valves were upgraded to allow for periodic integrity testing of the fuel system's underground piping.

The final phase of the project will determine what do with the old tanks that are no longer needed. Brockman expects them to be removed.    

New Concourse Configuration

Earlier this year, the Memphis-Shelby County Airport Authority announced a $114 million plan to remove the south ends of concourses A and C, and then widen and modernize Concourse B. The mostly vacant portions of concourses A and C are being cleared to facilitate aircraft access to the airport's larger B concourse. MEM is retaining the balance of concourses A and C to use in the future.

Demolition in Concourse A is expected to begin later this year, with similar Concourse C work following in 2015. The reconfiguration will leave the airport with about 60 gates. Renovations to Concourse B are planned for three phases, from 2016 to 2020. 

"We have begun the process of reinventing the Memphis Airport," Brockman explained, when plans were unveiled in February. "Part of that reinvention involves consolidating operations so we can better serve our passengers, airlines, concessionaires and employees. More importantly, we're going to modernize the B concourse, giving our passengers more room to move, better lighting and more convenience."
 

FedEx's Fuel Farm

In addition to serving 6 million passengers per year, Memphis International Airport (MEM) is also the primary hub for FedEx Corp. and handles more cargo than any other airport in the United States. For about 25 years, MEM was the world's busiest cargo airport, until it fell to second place, behind Hong Kong International, in 2010.

While FedEx is a primary player at MEM, it is not part of the consortium involved with the airport's current fuel farm project. The shipping giant receives its fuel from an independent facility fed by an 18-mile pipeline that runs from airport property in Memphis, TN, across the Mississippi River to the Teppco pipeline system in West Memphis, AR.

A few years ago, MEM expanded the hydrant system used by FedEx. The project was part of a series of fuel farm expansions that has been a boon to both FedEx and the airport. Capacity increases in the system allowed crews to service up to 15 more large-body aircraft.

While FedEx alone accounts for a large portion of MEM's traffic, it also attracts other companies to the airport. The area surrounding MEM houses national and international distribution facilities for Flextronics, Hewlett-Packard, Nike, Sharp and many others that located in Memphis to be near the FedEx hub. Given the large network of nearby businesses with strong ties to the airport, MEM markets itself as "America's Aerotropolis."

 

Subcategory: 
Fuel Operations

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