The first stage of any phase transition is a dynamic coupling of transport processes and thermodynamic changes. The free energy change of the phase transition must be negative and large enough to also overcome the penalty work needed for giving space to the new phase. The transition from an unstable situation over to a stable growth is called nucleation. Hydrate formation nucleation can occur along a variety of different routes. Heterogeneous formation on the interface between gas (or liquid) and water is the most commonly studied. A hydrate can also form homogeneously from dissolved hydrate formers in water, and the hydrate can nucleate toward mineral surfaces in natural sediments or a pipeline (rust). A hydrate particle's critical size is the particle size needed to enter a region of stable growth. These critical sizes and the associated nucleation times are nanoscale processes. The dynamics of the subsequent stable growth can be very slow due to transport limitations of hydrate-forming molecules and water across hydrate films. Induction times can be defined as the time needed to reach a visible hydrate. In the open literature, these induction times are frequently misinterpreted as nucleation times. Additional misunderstandings relate to the first and second laws of thermodynamics and the number of independent thermodynamics variables. It is not possible to reach thermodynamic equilibrium in systems where hydrates form in a pipeline or in sediments. Finally, there are common misconceptions that only one type of hydrate will form. In a non-equilibrium situation, several hydrates will form, depending on which phases the hydrate formers and water come from. In this paper, we utilize a simple nucleation theory to illustrate nucleation and growth of some simple hydrates in order to illustrate the non-equilibrium nature of hydrates and the fast nucleation times. To illustrate this, we apply thermodynamic conditions for a real pipeline transporting natural gas from Norway to Germany. This specific example also serves as a case for illustration of the possible impact of rusty pipeline surfaces in kicking out water from the gas. Specifically, we argue that the tolerance limit for water concentration according to current industrial hydrate risk practice might overestimate the tolerance by a factor of 20 as compared to tolerance concentration based on adsorption on rust.