ANCHORAGE/SINGAPORE Jan 10 A shutdown of the
Trans Alaska Pipeline, which ships 12 percent of U.S. crude
output, entered a third day on Monday, boosting prices and
raising pressure on operators including BP to restore
A leak was discovered at the northern end of the pipeline
in Prudhoe Bay early Saturday, near production facilities,
forcing oil companies to cut output to 5 percent of their
average 630,000 barrels per day.
The shutdown is the latest setback for the 33-year old
duct, which is becoming more expensive to maintain as it ages.
It currently handles less than a third of the oil it did at
its peak in the 1980s.
Closures of the pipeline, although short, has provoked
criticism of its operators, particularly major owner BP, whose
reputation was diminished after the Gulf of Mexico blow-out
last year caused the largest-ever U.S. oil spill and attracted
renewed government scrutiny of the oil production industry.
"Particularly for BP, it is really important to fix this
quite soon," said Hannes Loacker, oil analyst at Raiffaisen
"This company sold a lot of assets, and it's probably
facing a small production decline compared to previous
quarters. It's in a transformation phase and all the assets
they have should be working properly."
For a list of incidents on the pipeline, click on
The shutdown of the 800-mile (1,280 kilometre) line, which
runs from the Prudhoe Bay oilfield to the tanker port of
Valdez in southern Alaska, has not yet affected shipments, and
tankers are being loaded on schedule at Valdez, meaning there
is no immediate danger of restricted oil supply.
Oil produced during the shutdown will be stored at Prudhoe
Bay until the pipeline reopens.
"For the global overall market, it should justify a minor
reaction," Loacker said. "It's of course a problem for North
America, but it wouldn't justify that the price increases by 2
or 3 percent."
U.S. crude for Febuary CLc1 jumped as much as 2.2
percent earlier on Monday, but then retreated to add 0.8
percent to $88.73 at 10:00 GMT.
Response crews have recovered nine to 10 barrels of oil
from the basement of a booster pump building, about 90
percent, Alyeska Pipeline Service Co., the operator of the
pipeline, said on Sunday.
Engineers are considering options for restarting the line,
including a plan to bypass the affected piping, Alyeska said.
Alyeska is owned by oil companies with interests on
Alaska's North Slope, the third-largest U.S. oil producing
region after the Gulf of Mexico and Texas.
Major owners in the region are BP, ConocoPhillips
and ExxonMobil Corp . BP owns about 47 percent of the
venture, while ConocoPhillips and ExxonMobil hold 28 percent
and 20 percent respectively.
The pipeline carries all crude produced from Alaska's
North Slope oilfields. Normally, about 43 percent of oil
flowing through the pipeline belongs to ConocoPhillips, 30
percent to BP and 20 percent to Exxon Mobil.
The last time the pipeline was shut down unexpectedly was
in May, when a power outage at a pump station triggered a
series of events that caused an estimated 210,000 gallons
(5,000 barrels) of crude oil to spill out of the storage tank
at Pump Station 9, located about 105 miles south of Fairbanks.
Oil flow through the line peaked in 1988 at over 2 million
barrels a day, but output from Prudhoe Bay and other maturing
North Slope fields has dwindled significantly since then.
(Reporting by Yereth Rosen with additional reporting by
Alejandro Barbajosa; Editing by Ed Lane)