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Vol. 19, No. 30 Week of July 27, 2014
Providing coverage of Alaska and northern Canada's oil and gas industry

17 billion barrels

Iconic Alaska pipeline hits milestone as operator looks to extend its life

Wesley Loy

For Petroleum News

The trans-Alaska pipeline system has now moved a staggering 17 billion barrels of North Slope crude oil.

It might move billions more, provided operator Alyeska Pipeline Service Co. can overcome serious technical challenges.

Alyeska is conducting vital tests at an Oklahoma university to help TAPS deal with problems associated with declining throughput. The company also is trying robots to combat corrosion, a constant threat to the pipeline.

Meantime, Alyeska is close to finishing what has been a lengthy, expensive and somewhat troubled effort to modernize pipeline pump stations.

TAPS has been moving oil from Prudhoe Bay and other North Slope fields for 37 years, since 1977.

The 17 billionth barrel started down the 800-mile pipeline on July 19, Alyeska said.

“This is an operational milestone and legacy that we are all proud of,” said Tom Barrett, company president.

Since the beginning, some 21,300 tankers have loaded oil at Valdez, the pipeline’s southern terminus.

The last major milestone for TAPS was in October 2009, when throughput reached 16 billion barrels.

Kudos for Alyeska

The news of 17 billion drew notice among elected officials and others.

“This is a big achievement and I want to congratulate the Alyeska Pipeline Service Co.,” said U.S. Sen. Mark Begich, D-Alaska. “Seventeen billion barrels of oil is the equivalent to all the energy Americans use in one year and 8 trillion driving miles in the average car. TAPS is an incredibly important asset for the economy in Alaska and the rest of the nation.”

“When we first envisioned a pipeline to connect our oil-rich North Slope to the rest of the world, and subsequently passed the Trans-Alaska Pipeline Authorization Act through Congress in 1973, we knew this vital piece of Alaskan infrastructure would provide for Alaskans then, now, and into the future,” said Alaska Republican Congressman Don Young.

Both lawmakers said it’s important to push for policies to allow increased oil production from the North Slope, including federal land and the offshore.

The Alaska Oil and Gas Association also saluted Alyeska.

“TAPS is our economic lifeline and a source of great pride for Alaskans,” said Kara Moriarty, AOGA’s president. She noted that billions of barrels of oil remain on the North Slope.

“Alaska’s economic future is under our feet, and with the right investment climate, we will bring that oil to market,” she said.

The Tulsa tests

Alyeska, based in Anchorage, operates the pipeline on behalf of owners including BP, ConocoPhillips and ExxonMobil.

The pipeline system represents a huge ongoing expense in producing North Slope oil. Over the years, the owners have sought to control costs as production has declined. Daily pipeline throughput peaked at more than 2.1 million barrels in 1988. Today, the stream is roughly 550,000 barrels per day.

The production decline is expected to continue, and this presents serious adversity for Alyeska. With lower throughput, the warm oil can cool during the long journey south, bringing potential problems such as freezing and wax deposits.

Alyeska has put a lot of thought into what happens should throughput drop below 350,000 barrels per day, company spokeswoman Michelle Egan told Petroleum News.

As part of a recent study on low flow, Alyeska looked at alternatives for moving oil, including a shift to rail or ships or construction of a brand-new pipeline, Egan said.

For now, the path forward is to find solutions to keep TAPS running, she said.

Part of this effort involves testing at a University of Tulsa lab. Researchers are operating a “flow loop” to study variables such as oil temperature, velocity, water content and the formation of ice crystals. The experimental unit, three to four stories tall, functions essentially as a scale model of TAPS, Egan said.

Robots and reconfiguration

In other work, Alyeska is deploying “robotic pigs” at Pump Station 3, near the northern end of the pipeline. These devices can crawl through and inspect inaccessible piping at risk of corrosion and leaks.

“If it works for us, it’ll be a breakthrough technology,” Egan said.

Alyeska also is close to finishing an arduous, 10-year campaign of pump station renewal. Known originally as “strategic reconfiguration,” the program involves upgrading pumps, power systems and other equipment and reducing staff in favor of more automation.

Overhaul of three of the pipeline’s main pump stations (3, 4 and 9) is complete.

Pump Station 1 at the start of the pipeline is the last to get a makeover.

“It is incredibly busy there,” Egan said, as crews work toward the finish.

Alyeska expects to begin “forward flow” with PS 1’s new pumps around the first of the year, she said. The station’s legacy pumps would then be idled.

The modernization project has taken much longer, and cost much more, than Alyeska and the owners expected. Expenditures have exceeded $700 million.



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