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Vol. 12, No. 3 Week of January 21, 2007
Providing coverage of Alaska and northern Canada's oil and gas industry

KUPARUK ANNIVERSARY: ULSD plant going in at Kuparuk in ‘08

Arctic ultra low sulfur diesel facility will serve both ConocoPhillips, BP North Slope operations

Kristen Nelson

Petroleum News

By the end of 2008 Kuparuk will produce ultra low sulfur diesel at a new facility at CPF-3.

And by agreement with the Air Division at the Alaska Department of Environmental Conservation, that diesel will be used for all requirements at fields operated by ConocoPhillips and BP, by the companies and by their contractors, not just for uses mandated by law.

Some 70-80 percent of diesel uses would have been covered by the requirements. In exchange for time to design, build and install an arctic-capable ultra low sulfur diesel facility slope operators will also use ULSD in the remaining applications, said Ken Donajkowski, ConocoPhillips Alaska vice president of health, safety and environment.

Uses not required include such things as portable heaters, portable light plants and stand-by generators, he said.

The agreement saves the companies from having to truck the diesel to the slope. Donajkowski said one estimate found that if the companies had to haul ultra low sulfur diesel to the North Slope there would have been 20 trucks on the road at all times.

When you transfer liquid “you have potential for spills,” plus the additional truck traffic on the Haul Road and the potential for accidents there, he said.

Facility needed to operate in arctic conditions

Both ConocoPhillips and BP produce diesel on the slope at topping plants — one at Kuparuk and one at Prudhoe Bay.

What the companies proposed was building one plant on the North Slope to produce ULSD, but they had to get a plant designed and built that could operate in arctic conditions.

New federal rules require using ultra low sulfur diesel fuel in certain diesel-powered highway vehicles (trucks and buses) by July 2006 and in non-road engines (primarily construction and earthmoving equipment) beginning in 2010.

Under the ULSD agreement the construction of the new North Slope ultra low sulfur diesel facility is scheduled for the end of 2008, with production of the ULSD fuel in early 2009. In addition, ConocoPhillips and BP will spend approximately $4 million on further emission improvements to diesel-fired sources.

ConocoPhillips and BP will use ULSD on the North Slope in all diesel-driven vehicles and equipment, including equipment not subject to the new federal rules. The producers will also require their contractors to use the cleaner fuel as well.

Donajkowski said there wasn’t time to get a plant in place, so the companies agreed that in exchange for the time needed to build a plant “and not have to haul diesel, we will actually use ultra low sulfur diesel in all sources — not just what the regulation requires — but we’re going to use it everywhere we use diesel as a fuel.”

“So every source, combustion source using diesel will be cleaner, not just those regulated by EPA,” Donajkowski said.

ULSD will be used at Alpine; BP will use it; and the companies are going to require all their contractors to use it.

“We’re ensuring that our contractors adhere to these provisions, including non-regulated sources.”

There won’t be significant excess capacity, but he said whatever excess diesel there is “we will make that diesel available to others.”

“The complexity is such that we don’t want to be building multiple ultra low sulfur diesel plants,” Donajkowski said, which is why BP and ConocoPhillips will co-own the one plant at Kuparuk.

Installation in summer 2008

Paul Dubuisson, ConocoPhillips Alaska’s manager of North Slope operations said modules for the ultra low sulfur diesel plant will come up on the 2008 summer sealift; installation will start that summer and the facility will be in operation at the end of 2008.

Both Kuparuk and Prudhoe Bay have topping plants that produce diesel.

“You’ll take the diesel from the topping plant (at Kuparuk) and you’ll put it through this new facility and it will strip the incremental amount of sulfur out of that.” If more diesel is required, it will be trucked from the Prudhoe topping plant to the new facility.

The Kuparuk topping plant is at CPF-1; the new facility will be at CPF-3, where there is more space for it, Dubuisson said.



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