ANCHORAGE, Alaska — The Trans Alaska Pipeline was shut for a second day on Sunday because of a leak, with no indication of when it would reopen, sending oil prices higher on fears that a prolonged closure could restrict U.S. supplies.
The leak was discovered at the start of the pipeline in Prudhoe Bay early Saturday, forcing oil companies to cut production to 5 percent of their average 630,000 barrels per day.
The shutdown of one of the United States' key oil arteries, carrying about 12 percent of the country's production, is the latest setback for the 33-year old pipeline, which is becoming more expensive to maintain as it ages, and handles less than a third of the oil it did at its peak in the 1980s.
http://www.msnbc.msn.com/id/40982943/ns/business/
AirlinePilot wrote:Interesting. Simmons comes to mind.
Alaska oil pipeline repairs complicated by winter cold
By Lisa Demer | The Anchorage Daily News
Monday, January 10, 2011
... The leak was found inside a building near Pump Station 1 on Alaska's North Slope. The building houses booster pumps, which raise and regulate the pressure of crude oil from storage tanks before it gets into the main pipeline. The booster pumps are critical to operation of the main line, Alyeska and state officials say.
Officials had no estimate on when North Slope production would resume.
On Sunday evening, Alyeska was working on a plan to disconnect and seal off the area of damaged piping and install a bypass line to carry oil to the main pipeline, according to a state Department of Environment Conservation situation report.
So far 9 to 10 barrels of spilled oil -- around 400 gallons -- have been recovered from the building's basement, said Alyeska spokeswoman Michelle Egan. The oily mess was one-half to an inch deep on the 30-by-40-foot basement floor. Most of that oil was sucked up by vacuum trucks. It will be injected back into the pipeline.
Alaska Pipeline Closes Drop in Production by BP, Others Threatens to Push Oil Toward $100 a Barrel ... Total production on the North Slope is around 630,000 barrels a day—about 9% of total domestic U.S. output.
BP shares fall on Alaska pipeline shutdown North Shore producers forced to suspend 95% of production ... The shut pipeline carries around 15% of U.S. domestic oil production. Crude-oil futures moved higher. Crude futures recover, move back toward $89 mark.
Confidential Report Blames BP Executive For Distress at Alyeska Pipeline
By Jason Leopold
August 4, 2010
That prompted Rep. Tim Walz (D-Minnesota), a member of the subcommittee, to demand Jones provide the committee with statements from the individuals who changed their position.
But that's not what the committee was told in a July 26 letter signed by Tom Webb, Alyeska's engineering integrity manager, who worked on the relocation analysis.
Webb said, "At the current time, I do not know of any Integrity or Safety risks resulting from the relocation," adding that the measure has resulted in "the loss of over 30% of Integrity Management's staff."
According to several Alyeska officials, the committee has not yet spoken with the other integrity management personnel who worked on the report, but they accused Jones of misrepresenting the facts.
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Alyeska has been the subject of intense scrutiny in recent months following a 4,500-barrel oil spill at one of its pump stations [number 9, not number 1 like this time] on the North Slope in May, which, according to a copy of a separate 17-page internal report into the circumstances behind that incident, was largely the result of the company continuously repeating past mistakes.
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The facility [at Pump Station 9] is usually unmanned, another cost-cutting measure implemented by Alyeska as part of its long-delayed "strategic reconfiguration plan," an "efficiency" measure implemented by TAPS' owners to address declining oil production on Prudhoe Bay.
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Some senior Alyeska employees, who reviewed [Charles Thebaud and Jane Diecker of the law firm Morgan, Lewis & Bockius's] report, said they believed it ultimately amounts to a "whitewash" because it failed to absorb how low morale, poor leadership and a culture of fear has already affected the safe operations of a pipeline that moves anywhere from 600,000 to 700,000 barrels of oil per day and accounts for 15 percent of the country's oil supply. The employees pointed to the spill at pump station 9 as evidence of how these issues have affected pipeline safety and integrity.
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vtsnowedin wrote:8) At least it is inside a building so the people working on the fix don't have to work outside in the dark or in blizzard conditions. If they were outside they would have to tent over the broken section as a first step to control working conditions.
vtsnowedin wrote:Puzzling response. Spoiling for a fight this morning? Are you suggesting that the oil leak might be outside the building and following the pipeline back into the building? Other then that would it not be a case of turning the lights on and following the oil blood trail from the puddle back to the leak.
Initial Incident Report (PDF)
ALASKA DEPARTMENT OF ENVIRONMENTAL CONSERVATION
Division of Spill Prevention and Response
Prevention and Emergency Response Program
SITUATION REPORT
INCIDENT NAME: Pump Station 1 Booster Pump Piping Incident SITREP #: 1
SPILL NUMBER: Pending LEDGER CODE: Pending
TIME/DATE OF SPILL: 08:46 January 8, 2011
TIME/DATE OF SITUATION REPORT: 6:30 PM January 8, 2011
TIME/DATE OF THE NEXT REPORT: 3:00 PM January 9, 2011
TYPE/AMOUNT OF PRODUCT SPILLED: Safety procedures have precluded an assessment of the volume of crude oil released so far, however, the volume of the spill will be determined through a metering procedure once it is safe to do so. The oil released into a concrete “sump” within the Booster Pump Building. The oil was released from a concrete encapsulated pipe outside the Booster Pump Building, and flowed into the building sump. Oil is believed to be still trapped within the space between the pipe and the concrete of the encapsulated line.
LOCATION: Pump Station One, Alyeska Pipeline Service Company
CAUSE OF SPILL: The cause of the release is under investigation.
POTENTIAL RESPONSIBLE PARTY (PRP): Alyeska Pipeline Service Company (APSC)
RESPONSE ACTION: APSC shut down the Trans Alaska Pipeline after the incident was discovered, which caused the North Slope (NS) oil producers to reduce production by shutting in wells. APSC stood up a full incident management team at the Fairbanks Emergency Operations Center (FEOC). State and Federal representatives were notified of the release and have joined the response. Engineers and technical specialists are expected to arrive at PS1 around 6:00 PM today to design a temporary pipe plan. Hydrocarbon vapors above safety and health levels were controlled by ventilating the building and conditions are now safe to begin oil removal. Neither the booster pumps nor other facility infrastructure suffered damage from the oil release. Vacuum trucks are on scene for oil removal. An ADEC responder on the North Slope will monitor the cleanup and gauge the volume of recovered oil and additional ADEC responders have been dispatched to both the FEOC and the spill site. Additional resources are en route to support the oil recovery and pipe repair efforts. The North Slope oil producers are to limit production to 5 percent of normal.
SOURCE CONTROL: The lines supplying crude oil to the booster pumps are shut in to stop any further release of oil.
RESOURCES AFFECTED: Alyeska Pump One Booster Pump building and gravel pad.
FUTURE PLANS AND RECOMMENDATIONS: The source of the release will be assessed and area of contamination delineated. Removal of oil from the building is on-going. APSC will complete an engineering review of as-built drawings, prepare a temporary pipe repair plan, and expedite the installation of parts to repair the line.
WEATHER: East wind at approximately 5 knots, visibility 10 miles, ambient temperature -10° F.
Questionmark wrote:I was going to say that it doesnt look like markets were reacting to the news but were back up through $89 now.
Sixstrings wrote:AirlinePilot wrote:Interesting. Simmons comes to mind.
What did Simmons have to say about the pipeline?
Matt methane-is-toxic-avoid-beans-for-dinner Simmons on Aug 6, 2006 wrote:Mr Simmons, a US-based industry commentator and financier, said BP's discovery of unexpectedly severe corrosion in its pipelines at Prudhoe Bay, Alaska, could just be the tip of the iceberg. He described the sudden emergence of the issue as the "Pearl Harbour Day" for energy.
Analysis: Alaska pipe restart could be fast, but risks remain
By Joshua Schneyer
NEW YORK | Mon Jan 10, 2011 4:08pm EST
... Regulators and experts a bypass to install a replacement pipe may take 5 days if things go smoothly.
... But experts also cited factors that could delay the line and cause supply disruptions. These included corrosion that may affect a larger expanse of pipeline, or cold temperatures that can complicate a restart if TAPS is idle for more than several days.
... West Coast refiners would have to substitute Alaskan oil supplies with cargoes from the Pacific Coast of Asia or South America. Crudes from those regions are typically priced directly or indirectly against Brent, justifying its growing premium to WTI. ...
Parts for pipeline bypass operation under fabrication in Fairbanks; leaking pipe still not found
by Dermot Cole
Jan 10, 2011
... At noon Sunday, oil was still seeping at a half-gallon per minute into the basement. The pipes are to be sealed and drained.
The Dow Jones news service quoted an anonymous source Monday as saying that pipeline operators hope to get the system running by Friday.
Parts to repair the broken feeder line and construct a bypass around the broken section are being fabricated in Fairbanks, the state said, while Alyeska Pipeline Service Co. is refining plans for the complicated bypass operation and working on ways to limit the threat from a winter shutdown to the 800-mile line.
There are several pipes in the concrete casing and the damaged pipe has not been identified, the state said in the status report. ...
... The spill was discovered Saturday at 8:16 a.m., reported to DEC at 8:39 a.m. and the flow of oil to the main pipeline was shut down at 8:50 a.m. ...
Oil pipeline shutdown costs Alaska $18.1 million daily
By Lisa Demer | The Anchorage Daily News
Tuesday, January 11, 2011
The shutdown of the trans-Alaska pipeline is likely to extend into a fourth day, making it the third longest closure in the line's 33-year-history. Officials haven't yet announced how or when they intend to restart it, which is challenging in the dead of winter.
About 600,000 barrels of crude oil -- some $50 million worth -- that normally would pulse into the pipeline remain in the ground every day it is shut down. North Slope oil field operators are producing only about 5 percent of their usual amount, or about 30,000 barrels a day.
Every day of the shutdown costs the state of Alaska $18.1 million in oil royalties and taxes at current oil prices, according to the state Department of Revenue. That's money it won't be able to collect this budget year, although eventually, when all the oil is pumped from the ground, the state presumably will get its share. Oil proceeds are the main source of state revenue.
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As of 10 a.m. Monday, 18 barrels of oil -- or 750 gallons -- had been recovered from the pump house basement, about double the total as of the day before. Residual oil in the piping or spill path is continuing to seep into the building, the state Department of Environmental Conservation said in a situation report released Monday evening.
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