August 7th, 2006 at 10:13 am
AFP reports (link dead) that BP has shut down a major pipeline that transported oil from half of the oil fields in Alaska. Estimates indicate a drop in production of about 400,000 bbls/day. AP has a similar article. Yahoo! Finance reports the drop is about 8% of the U.S. oil supply. The reports speculate the price of oil may jump up another $10/bbl.
The Trans-Alaska pipeline is about 800 miles long with multiple feeds, so one can understand why a leak would take several days to close off. On the other hand, corrosion is a slow process, so I’m curious as to why a leak had to occur before detection. If they knew about the corrosion but didn’t deal with it, that would be at least an ethics violation and probably violations of the legal sort.
Hopefully after the repairs are done they can use the higher oil prices to look at redundancies or better corrosion monitoring. It’s in BP’s interest to keep that oil flowing.
As a matter of principle I’m not sure I like the Energy Department using the Strategic Petroleum Reserve as an economic buffer. At 700,000 bbls it’s not a big buffer (about 1.75 days worth of the TA pipeline). It reduces the incentive for companies to increase capacity when prices spike, and refilling the SPR keeps prices up later. We also don’t know when and if that fuel may be needed for military and civil defense operations.
August 8th, 2006 at 8:30 am
It’s not the Alaska pipeline itself that is corroded (it is maintained better than most roads in Alaska) but the pipelines from the individual wells in Prudoe Bay that feed the Alaska pipeline that corroded. Aleyeska is not at fault for this because BP owns the feeder lines.
August 8th, 2006 at 9:54 am
Okay, that makes more sense. Thanks for the knowledge.
August 8th, 2006 at 2:47 pm
It still does not make sense to me.
If the leaks are in feeder pipelines from individual groups of wells why do they have to shut down entire pipeline?.
It does NOT make sense to me that the indiviual pipelines would not have individual shut-off valves to the pipeline.
If the corrosion problems is in the valves BP screwed up royally in the design specs.
amaim
August 8th, 2006 at 3:00 pm
It looks like I’ve read too much into the story.
AFP: “World crude prices spiked to nearly record high points in London after the BP oil major began closing production from a key oil field in Alaska because of a pipeline spill.”
AP: “Oil giant BP (BP) has shut down the biggest oil field in the U.S. to replace a corroded piece of pipeline that is leaking. ”
AP: “BP PLC said it will have to replace most of the 22 miles of so-called transit pipeline at Prudhoe Bay, which produces about 2.6% of the nation’s daily supply including imports, or about 400,000 barrels a day.”
As RandomDan said, the 800-mile Alaska pipeline isn’t down, but some of the pipeline from Prudhoe Bay that feeds the Trans-Alaska is. They don’t have to shut down the T.A.P. They do have to use the individual shut-off valves because the corrosion problem is in that many lines.
My apologies. That’s why I link to the articles.