Company says trans-Alaska oil pipeline could restart as early as Thursday after spill shutdown

Company: Alaska pipeline could restart Thursday

JUNEAU, Alaska — The flow of oil through the trans-Alaska pipeline system could resume as early as Thursday after the 800-mile line was shut down this week due to a contained spill.

Operator Alyeska Pipeline Service Co. reported “significant progress,” with power restored to a pump station, crews beginning to drain oil from a storage tank that overflowed, and cleanup and oil recovery under way.

“The next step is startup,” spokeswoman Michelle Egan said, though she noted that needs to be a highly coordinated, deliberate process to ensure the line gets back up without problems.

The company has bought itself until noon Friday to make that happen, “but we hope it will be sooner than that,” Egan said. Alyeska ordered production levels drastically reduced to keep oil from quickly filling storage facilities being used while the line is down.

On Wednesday, oil companies were asked to reduce production even further, cutting it from 16 percent of normal output to 8 percent.

The line has been shut down since Tuesday, when Alyeska said a power failure during a planned shutdown to test fire systems caused normally closed valves to open. That resulted in what the company said was up to several thousand barrels of oil spilling into a partially filled storage tank. The tank, in turn, overflowed into a containment yard lined with an impermeable barrier.

Egan said officials hoped to have a better estimate on the spill size soon.

The storage tank was the site of a 2007 fire for which Alyeska faces $506,000 in fines. The federal Pipeline and Hazardous Materials Safety Administration concluded the fire was a high-risk event, but Alyeska has disputed the agency’s findings and is fighting the proposed fines for alleged safety violations connected to the fire at Pump Station 9.

Energy analysts didn’t expect a temporary shutdown to have much effect, if any, on crude prices and refinery production.

The pipeline carries oil from Alaska’s North Slope to Valdez, where tankers pick it up and deliver it to refineries. So far, Egan said there have been no changes to the tanker schedule or to loads that tankers are carrying.

Last month, the pipeline moved 645,113 barrels of oil per day, on average. Average crude oil production in the U.S. is about 5.5 million barrels a day.

Tom DeRuyter, on-scene coordinator for the state Department of Environmental Conservation, said the cost of the cleanup rests with the responsible party.

He said the agency also is investigating the cause.

“We don’t ever like to see these things happen,” he said.