Upstart Pipeline Company Staking Its Future on Stopping Heavy Oil Corrosion

An upstart company in Ohio is aiming to disrupt the oil pipeline business with new technology that resists corrosion far more effectively than conventional pipe.

MesoCoat, Inc. says its technology will become especially crucial as global oil production shifts to more sulfurous and heavier fuels like tar sands crude. It claims it can make pipelines safer from potential leaks and save oil companies hundreds of millions of dollars by reducing the frequency of replacing corroded pipes.

At just six years old, MesoCoat is already attracting interest from major oil companies and research centers in Alberta, home of Canada's vast oil sands resources. It has won five R&D 100 awards for innovation, plus an award from the National Institute of Standards and Technology, a U.S. agency. In the fall, it took the top spot in The Wall Street Journal's Technology Innovations Awards for manufacturing.

The global attention is helping MesoCoat leap from startup to commercial company. But for Canada's tar sands industry, the attention appears to be coming at a less-than-opportune time, as it lobbies hard for approval of the Alberta-to-Texas Keystone XL pipeline.

One of the main objections to the Keystone is the possibility that the tar sands oil it would carry is more corrosive to pipelines than ordinary crudes, with implications for oil spills. That concern deepened last week after an ExxonMobil pipeline carrying bitumen ruptured and leaked at least 200,000 gallons of the tarry crude in an Arkansas neighborhood.

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