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Providing coverage of Alaska and northern Canada's oil and gas industry
September 2006

Vol. 11, No. 37 Week of September 10, 2006

BP to have bypass lines up in October

Oil will move from eastern side of Prudhoe to Endicott and Lisburne transit lines; 10,000 feet-plus of inspections since Aug. 6

Kristen Nelson

Petroleum News

BP expects to have bypass lines in place to move oil from the eastern side of the Prudhoe Bay field by the end of October, Maureen Johnson told the Resource Development Council Sept. 7.

Johnson, a BP Exploration Alaska Inc. senior vice president and business unit leader for Greater Prudhoe Bay, said BP will have Prudhoe Bay back up “sooner than people think.”

The company shut in the eastern operating area at Prudhoe Aug. 6. On Aug. 4 the company received results of a smart pig run which indicated 16 anomalies in 12 locations on the transit line between Flow Station 2 at the eastern edge of the field and Flow Station 1. Transit lines move sales-ready oil from processing facilities to the trans-Alaska pipeline.

“That was a big surprise,” Johnson said.

BP sent people out to do ultrasonic testing to verify the smart pig results. She said smart pig technology doesn’t always show defects exactly and the company thought it might be looking at external corrosion — or incorrect information.

Discovery of a couple of spots with oil staining on the insulation caused the company to shut down Flow Station 2. A leak was later found.

With damage in a line believed fit for service, BP made the decision to shut down the field, starting with the eastern operating area. Testing of transit lines on the western side led to the decision that operations could continue there, although BP has since said it will replace the 16 miles of transit lines in both eastern and western operating areas.

Inspection work continues, along with bypass construction

Johnson said that following the Aug. 6 decision to shut in the field BP inspected 5,513 feet in the western operating area, 22 percent of the 25,301 feet of transit pipe, and 4,783 feet on the eastern side, 18 percent of 25,996 feet: no significant anomalies were found.

In addition to inspection work, bypass lines are being installed.

A bypass line from Flow Station 3 to the Lisburne transit line, which was pigged earlier this year and found to be in good condition, “is basically commandeering one of our common lines, one of our three-phase lines,” Johnson said.

Two other bypass lines, from Flow Station 1 and Flow Station 2 to the Endicott transit line, “are basically very short tie-ins.”

“The Endicott line was smart pigged last summer; it’s in good condition,” Johnson said.

BP will make changes in its inspections, and “will run in-line inspection tools, smart pigs, in all of our transit lines as soon as we possibly can,” she said. Maintenance pigs will have to be run first to clean the lines and a new pig launcher will have to be installed at Gathering Center 1.

BP’s budget for major maintenance is expected to be $195 million in 2007, a nearly four-fold increase from a 2004 budget of $52 million. The company spent $100 million on major maintenance in 2005 and will spend $135 million this year.

Integrity management, independent experts

BP has “an excellent corrosion management program on the North Slope,” Johnson said, acknowledging that it is “undeniable that there were gaps in that system.”

All BP-operated oil transmission lines on the North Slope will be included in the U.S. Department of Transportation’s pipeline integrity management program.

And, she said, the company has hired three international independent corrosion experts to help determine gaps in its corrosion system.

In a Sept. 7 press release on the corrosion experts, BP America Chairman and President Bob Malone said the three experts will independently review and make recommendations for improving the corrosion inspection, monitoring and prevention program in place at Prudhoe Bay and in other BP-operated Alaska oil fields.

Malone told a U.S. House of Representatives subcommittee investigating the Prudhoe shutdown that: “While the team in Alaska believed they had an effective corrosion program, in retrospect, clearly there were gaps. For that reason I have retained three of the foremost corrosion experts in the world to evaluate and make recommendations for improving the corrosion program in Alaska.”

He also said the company will spend more than $550 million (net) on integrity management in Alaska over the next two years.

The members of the independent corrosion panel are: Digby Macdonald, Ph.D., a Distinguished Professor of Materials Science and Engineering at Pennsylvania State University in University Park, Pa.; Joe Payer, Ph.D., Professor of Materials Science and Engineering and past director of the Yeager Center for Electrochemical Science at Case Western Reserve University; and John Banyard, a Chartered Civil Engineer and Royal Academy of Engineering Visiting Professor at the University of Loughborough in the United Kingdom.

Malone also said he has asked former Federal District Court Judge Stanley Sporkin to undertake an independent review of all worker allegations that have been raised on the North Slope since 2000. Sporkin has agreed to serve as an independent ombudsman for BP America.

“These concerns will be reviewed to determine if the problems have been addressed and rectified,” Malone said.






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