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Vol. 11, No. 33 Week of August 13, 2006
Providing coverage of Alaska and northern Canada's oil and gas industry

BP shuts in part of Prudhoe Bay

Company will replace all main transit lines in field, following unsettling pigging results, 4-5 barrel spill on eastern side

By Kristen Nelson

Petroleum News

The Aug. 6 announcement rumbled across Alaska like an earthquake and set off tremors in international oil markets: BP was shutting down Prudhoe Bay.

The field, the largest in North America, produces some 400,000 barrels per day, almost 50 percent of North Slope oil. By Aug. 10, the eastern operating area had been completely shut in; some 120,000 bpd were still coming from the western operating area, and BP said it is “actively evaluating options with the U.S. Department of Transportation and Alaska Department of Environmental Conservation for safely continuing operations on portions” of the field, and is focusing ramped-up inspection activities on the still-producing western operating area.

BP said Aug. 10 that a decision on whether to shut in the western operating area is expected by the beginning of the week of Aug. 14.

Shutdown triggered by leak

The shutdown was triggered by discovery of corrosion and a small leak in a transit line, the in-field lines that carry processed oil, sales quality oil with water, gas and sediments removed, to the trans-Alaska oil pipeline.

The four- to five-barrel leak was discovered Aug. 6 as BP tested lines in compliance with a Department of Transportation order stemming from a much larger spill in March.

The March spill was on the other side of Prudhoe Bay, in a transit line coming from Gathering Center 2 on the western side of the field. The source of that leak was a one-quarter-inch hole caused by corrosion; the spill, more than 200,000 gallons, was the largest in Prudhoe history.

The Department of Transportation’s Pipeline and Hazardous Materials Safety Administration ordered BP to pig all the transit lines as a result of the March spill.

BP was cleaning and testing those lines and on Aug. 4 the company got results from a July smart pig run through a transit line coming from Flow Station 2 on the eastern side of the field. Those results showed 16 anomalies at 12 locations. Workers who went out to check on the anomalies with ultrasound equipment found an oil stain when they began removing insulation at one site and then, as they continued the inspection after a shut down of Flow Station 2, a leak of four to five barrels of oil onto the tundra was discovered.

BP made the decision at that point to shut in the field.

Unexpected results

BP Exploration (Alaska) President Steve Marshall told a press conference Aug. 6 that BP “encountered some unexpected results on one of the transit lines” as it was working through a systematic evaluation of the lines.

Marshall said BP had begun shutting down the eastern side of the field, where the Flow Station 2 transit line leak was found. BP had been “working through a systematic evaluation of our transit lines” following the Gathering Center 2 transit line spill and because of what the company found it had begun a phased shutdown of the Prudhoe Bay field.

Marshall said the company was “mustering all the resources we can to assess the condition of the remaining lines and only when we’re absolutely satisfied that those lines are in mint condition will be bring those lines back to service.”

On Aug. 7 BP said it had decided it would replace all of its main Prudhoe Bay transit lines except Lisburne, which had been smart-pigged and found to be in good shape. Pipe is already on order for replacement of the three-mile GC 2 transit line; there is also a five-mile transit line from Gathering Center 1 on the west side of the field. In addition to the three-mile transit line from FS 2 on the eastern side of the field, there is also a five-mile line from Flow Station 1.

BP said in an Aug. 8 statement that approximately 40 percent of the Prudhoe transit lines had been smart pigged since the March spill: nine miles were maintenance- and smart-pigged in the last two months and 10 miles remained to be maintenance- and smart-pigged. The three miles from GC 2 to GC 1 on the western side of the field, the OLT-21 line where the March 2 leak was found, will be cleaned and decommissioned, the company said.

Some production possible

Marshall, BP America Chairman and President Bob Malone and Bill Hedges, BP Exploration (Alaska) integrity management team leader, were in Juneau Aug. 7 to give legislators an update. In a presentation to the Senate Special Committee on Natural Gas Development and in an open caucus on the House side, both Malone and Marshall apologized for the shutdown. More than 80 percent of the state’s general fund revenues come from oil and gas — the level of both state royalties and severance taxes are dependent on the volume of oil produced.

Malone told legislators that BP would put all necessary human and financial resources behind a program to bring production back as quickly as it safely could. He said the company is also working in parallel with the shutdown and repair operation to evaluate facilities on the North Slope and see if there is an opportunity to maintain some level of production.

Marshall noted that a bypass line was available on the western side of the field, and 85 percent of the output of GC 2, shut in after the March transit line spill, has been rerouted through a 24-inch line. The original 34-inch line will be replaced with an 18-inch line, already on order, Marshall said. He told legislators the velocity through the GC 2 line was the lowest in the field, about half a foot per second compared to two feet per second in the Gathering Center 1 line. The GC 2 34-inch line was built to handle an initial volume of 330,000 bpd; the 18-inch line will be more suited to day’s volumes, he said, and will increase the velocity and mitigate some of the settling issues.

Marshall said that the Lisburne 36-inch line was the first to be cleaned, scraped and smart-pigged and that line was found to be in good shape, was put back into production, and will remain in production at 17,000 bpd. The Lisburne transit line was built in the 1980s, while other main transit lines at Prudhoe were built in the 1970s prior to feed startup.

The Flow Station 2 line, he said, was the first of the 1970s vintage lines BP has been able to smart pig.

Problems corrosion

Hedges told legislators the problems in the FS 2 line is clearly corrosion and is “very much limited to the very bottom of the pipeline in the 6 o’clock position.” The problem, he said, is that there is no way to know where to look for corrosion along the line. Hedges said the best mechanism to control corrosion is to keep the lines clean and remove the solids that bacteria hide underneath, so solids wouldn’t be there to protect bacteria from the chemicals used to combat them.

Sediments appear to have fallen out at low spots in the line, he said, and sediments shield bacteria from the chemicals used to control them. It appears to be a low-velocity problem: a certain level of bacteria can be tolerated and most just flow through the system. Where they settle beneath sediments, however, they produce acids that can eat through metal.

Hedges said you can get a lot of sand in pipes on the west side. On the east side there is mineral scale, calcium carbonate, much as would build up in a domestic boiler system, because of the nature of the water. The solids are non-corrosive, he said, but the threat is that they allow bacteria to harbor under them, shielding the bacteria.

The corrosion mechanisms appear to be different on the two sides of the field: On the western side, Hedges said, all of the damage is associated with low spots; on the eastern side there isn’t that correlation with low spots. On the west side corrosion is primarily associated with sand sediments, but on the east may be more associated with calcium carbonate mineral scale, which is deposited along the entire pipe, so there could be corrosion anywhere.

Solids aren’t an issue for the trans-Alaska pipeline because they filter out solids before they get into the system. But if Prudhoe dumped all of its solids at one time it would clog Alyeska Pipeline Service Co.’s filtration systems. The specification of what the producers can send to Alyeska is 0.35 percent base sediment and water, Hedges said. Alyeska deals with that by pigging it out of their lines.

More pigging will be done

Marshall said BP’s “historical reliance on ultrasonic testing was clearly inadequate.” Once lines have been cleaned or replaced BP will do maintenance pigging on a regular basis so these problems don’t develop in the future, he said.

The company will use the best techniques it can find, including maintenance- and smart-pigging, he said. The problem with using ultrasonic testing alone is that you can’t test every inch every that: “that has been the Achilles’ heel of our program,” Marshall said.

Depending on the size of the defects it finds BP would temporarily sleeve or permanently clamp them, Hedges said, and would expect those engineering solutions to last until the line could be replaced.

Senate Resources Chair Tom Wagoner said the House and Senate Resources committees planned a meeting in Anchorage on Aug. 17 or 18 and would ask for a more complete presentation from BP at that time.

Alyeska Pipeline Service Co. spokesman Mike Heatwole told Petroleum News that Alyeska has looked at different throughput scenarios for the trans-Alaska pipeline, addressing how it would operate at different levels.

When BP made its decision Alyeska got its engineering, operations and oil movements technical people together and pulled those plans off the shelf.

He said Alyeska is working toward a plan that would allow continuous operations down to 400,000 bpd. There is a long-term issue about the impact of lower throughputs in the winter, Heatwole said, but the short-term plan is continuous operation down to 400,000 bpd while the company continues a technical analysis of long-term operations at lower levels.

One option mentioned by BP was batching oil: allowing it to build up in holding tanks on the North Slope and then sending it through.

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