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Prudhoe gets local congressional hearing State of Alaska’s delegation expresses displeasure over BP’s transit pipeline maintenance at Anchorage ‘listening session’ Kristen Nelson For Petroleum News
Alaska’s congressional delegation had a local opportunity to express their displeasure over the March and August spills from BP’s Prudhoe Bay transit lines at an Oct. 13 “listening session” in Anchorage.
The delegation has taken colleagues from the House and Senate to the North Slope “year after year,” said Sen. Ted Stevens, R-Alaska. Each time “I’ve visited we’ve been assured the operations at Prudhoe Bay were being conducted at the very highest standards. The facts that developed after the leaks indicate otherwise.”
“Transit pipelines have not had the surveillance of the major lines,” said Congressman Don Young, R-Alaska.
Sen. Lisa Murkowski, R-Alaska, said the transit line problems were a “wake-up call” and said it was an opportunity to better prepare ourselves for “a changing, a maturing industry up north.”
BP Exploration (Alaska) President Steve Marshall reviewed what the company has done to date, and said BP planned to run a smart pig earlier in the week but the extraordinarily high winds which combined with rain to cause power shorts in high-voltage equipment caused a delay. He said BP expected to have production back up to over 400,000 barrels per day in the next few days.
Production was at 370,000 bpd Aug. 18, BP spokesman Daren Beaudo told Petroleum News.
DOT inspectors also checking other slope operations Admiral Thomas Barrett, administrator for the Pipeline and Hazardous Materials Safety Administration at the U.S. Department of Transportation, said operators have the first responsibility for safety and said the standard at Prudhoe Bay prior to the March spill “was below what we frankly see elsewhere in the industry and elsewhere on the North Slope.” He said since March DOT inspectors have been looking “extensively over … operations in general on the North Slope just to make sure there are no other outliers.”
DOT did not have responsibility for the transit lines, but will have under regulations out for public review which would cover not just the North Slope, but lines nationwide in sensitive areas; lines through populated areas and in navigable waters are already regulated, he said.
Barrett said the agency regulates some 400 miles of pipelines on the North Slope, in addition to the trans-Alaska oil pipeline. DOT does not and will not regulate lines between wells and gathering centers, he said.
Marshall: cost not an issue Murkowski asked if the cost of pigging the transit lines was the reason BP hadn’t done it.
Marshall said the cost of pigging was not an issue; he said BP runs more than 350 pigs a year upstream of the transit lines.
Murkowski asked why an earlier state compliance order related to leak detection, in which solids in the lines were an issue, didn’t trigger cleaning the lines.
Marshall said he had not been aware of the compliance order until recently.
Kurt Fredriksson, commissioner of the Alaska Department of Natural Resources, said leak detection was the focus of the compliance order. He said BP suspected solids in the line but ultimately decided the solids wouldn’t interfere with a leak detection test, which turned out to be the case.
DEC’s focus, he said, has been on the 1,600 miles of gathering lines between the wells and the processing centers.
Chris Hoidal, the Pipeline and Hazardous Materials Safety Administration’s Denver-based western region pipeline director, said he was not aware of the state compliance order.
DOT: Engineering, re-piping required Murkowski said she didn’t know “who I’m more irritated at” since both the state and BP knew there were solids in the transit lines. She said she couldn’t understand why this was allowed to slide.
DOT’s Barrett said the ability to manage solids exists, but this system was built in the late 1970s and it took engineering and re-piping because the system was not originally designed to accept the types of pigs that are run today.
Maureen Johnson, BP’s vice president for Prudhoe Bay, said in response to a question about BP’s North Slope spending that she found the business to be pretty cost-focused in 2003: the North Slope had the second highest costs in BP’s portfolio, and the highest-cost asset was scheduled to be divested.
After about a year that changed: viscous wells became economic; a gas pipeline started to look possible; and BP realized it needed to spend more on maintenance. Prior to 2005 spending was fairly flat, Johnson said, but will rise from some $50 million for major repairs to $200 million in 2007.
Bob Malone, president of BP in North America, said “BP’s recent operating failures are unacceptable.” The company is “in action to fix the problems,” he said, and assured the panel: “I have been given all the necessary authority to accomplish this task.”
Malone introduced BP’s ombudsman, Judge Stanley Sporkin, and said Sporkin will review all North Slope employee complaints since 2000.
Asked by Young what kind of response would occur if an employee called with a report of sludge in the line, Sporkin said you first have to determine the urgency of the information. If it’s urgent, he said, you ring all the bells, but most of the time the information has to be checked out.
“I’ve been sending people up to the slope now for six weeks” to check out such information, he said.
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