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Alyeska lifts flow restrictions; prorations ended: Noon, May 22
Steve Sutherlin Petroleum News
Alyeska Pipeline Service Co. eliminated the proration on North Slope connectors to the trans-Alaska pipeline system, lifting restrictions on oil throughput effective May 22 at noon.
The proration began April 24 with a 10% cut to production, increased to a 15% reduction on May 8, and was subsequently reduced to 5% percent on May 15.
“After reviewing flow rates, current and projected inventory, and vessel movements, we will be eliminating the remaining 5% curtailment of shipments (proration) imposed earlier in May,” Alyeska President Brigham A. McCown said in a May 21 Twitter post.
The initial action was taken because of inventory concerns - to avoid overloading the 800-mile pipeline and its 6.6 million barrel tank farm at the Valdez marine terminal.
Occasional prorations are routine; the flow reductions this spring were not connected to the drop in oil prices and the coronavirus pandemic.
In an April 24 interview, Michelle Egan, chief communications officer for Alyeska told Petroleum News the 50,000 barrel-per-day reduction that began earlier that day was simply part of the day-to-day management of the pipeline.
Egan said the pipeline system is not a storage facility. If inventory in the pipeline system rises above 75%, Alyeska adjusts by altering tanker schedules, or by proration - requesting producers to send less oil.
“This time of year, high inventory is not uncommon,” Egan said.
Alyeska seeks to avoid prorations “Prorations are something we work hard to avoid,” Betsy Haines, Alyeska senior vice president of operations and maintenance told the Alaska House Resources Committee at a meeting in Anchorage May 8.
Alyeska looks at several factors for analysis - the upstream, the capacity of the terminal and the vessel movements, she said.
“Believe it or not, (the factors) do change almost daily.” Haines said. “We will certainly be looking at the information that’s provided to us from all connectors as we go into the month of June.”
Haines said that a COVID-19 related 100,000 bpd North Slope production cut announced April 30 by ConocoPhillips was not factored into Alyeska’s proration research in April, which determined an equal cut to all the connectors.
“We’ve used the same basis because this has been a constant proration that is occurring though April now into May, and the information that is coming in from the Kuparuk connections is information that is independent from the prorations,” she said.
Alyeska will continue working closely with connectors and marine shippers to manage inventory, the company said in a May 21 press release.
“Delivering every barrel possible is good news for TAPS, and great news for Alaska, the North Slope and domestic energy supply,” McCown said. “We’re committed to doing our part in getting the country back on its feet.”
- STEVE SUTHERLIN
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