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BP Optimistic for Normal Alaska Pipeline Production

Thursday , August 31, 2006 (Fox News)

PRUDHOE BAY, Alaska — BP officials are growing increasingly optimistic that Prudhoe Bay oil production may be returned to normal levels earlier than expected, believing a portion of the pipeline idled by corrosion concerns may be useable at least temporarily and that other sections can be bypassed.

The flow of oil from Prudhoe Bay has been cut in half to 200,000 barrels a day as BP prepares to replace 16 miles of pipeline after discovering extensive internal corrosion that resulted in spills in March and early August.

Oil deliveries resumed earlier this month through the western half of the pipeline system by bypassing the damaged sections of pipe. But the eastern section remains idled as BP conducts extensive tests to determine whether at least some of that pipe can be used.

"The idea that there was widespread corrosion simply was not correct," David Peattie, London-based BP PLC's (BP) vice president for exploration and production told The Associated Press on Wednesday.

He said the corrosion was isolated and that ultrasound tests now being conducted — foot-by-foot in some sections of pipe — are to determine how much of the shut down pipeline might be returned to service temporarily.

BP officials emphasized that any resumption of oil flow in the closed eastern section will depend upon whether the company can convince the federal Transportation Department that such a move can be made without risk of another spill.

"We are working together with them," Kemp Copeland, BP's Prudhoe Bay field manager, said Wednesday, referring to the Transportation Department. "Neither one of us wants to see another leak at Prudhoe Bay.

With three congressional hearings scheduled for early September on Prudhoe Bay chrosion, BP officials want to avoid any suggestion that they are playing down the extent of pipeline damage, or be perceived as wanting to return pipes to use prematurely.

But in briefings given Wednesday to Interior Secretary Dirk Kempthorne, who is on a three-day tour of North Slope oil facilities, and in separate interviews, BP officials clearly were optimistic that the pipeline system can be returned to normal production of 400,000 barrels a day, using a temporary fix.

The company still plans to begin work on replacing the 16 miles of pipe with new pipe early next year.

At the same time, BP is aggressively gathering test data along a five-mile stretch of the idle pipeline. BP engineers believe the tests will show the pipe is sound enough to resume use until the new system is completed. The three-mile section where extensive corrosion was discovered in early August would be bypassed using a nearby pipeline, the officials said.

BP officials took Kempthorne to the site of the most recent spill and to areas along another section of pipe that is undergoing intensive ultrasound testing to determine its integrity.

Copeland said that 2,700 ultrasound tests and an additional 4,000 tests using other technology have been done so far along the five miles of pipe officials hope to reopen and that the most severe degradation of pipe wall found so far has been 28 percent. By comparison, the wall loss was 78 percent or more in 16 areas of extensive corrosion near the August spill that prompted the August shutdown.

While Copeland and other BP officials cautioned that more testing needs to be done, they also said the results so far suggest strongly the pipe corrosion is not as widespread as some people had thought.

The final say on whether the eastern leg of the pipeline system can be reopened will be up to the Transportation Department, said spokesman Daren Beaudo of BP Alaska, the local subsidiary of the London-based parent company. But he added, "We're getting more and more confident that the tests will show some of the pipeline now shutdown will be deemed fi