Kevin Hostler, president of trans-Alaska pipeline company, retiring in September

By Becky Bohrer, AP
Wednesday, July 7, 2010

Head of trans-Alaska pipeline company retiring

JUNEAU, Alaska — Kevin Hostler, a former BP executive, is retiring as head of the trans-Alaska oil pipeline in September amid questions about the line’s management.

Hostler had already announced plans to retire from Alyeska Pipeline Service Co. by the end of the year but didn’t want recent reports about the company to be a distraction, company spokeswoman Michelle Egan said.

His retirement is effective Sept. 30. A replacement wasn’t immediately named; the pipeline system owners’ committee will choose that person.

BP Pipelines (Alaska) is the largest single owner of the 800-mile line that carries oil from Alaska’s North Slope to Valdez, where tankers pick it up for transfer to refineries. The other pipeline owners include ConocoPhillips Transportation Alaska Inc., ExxonMobil Pipeline Company, Unocal Pipeline Company Inc. and Koch Alaska Pipeline Company LLC. The line is independent of BP.

Recent questions have been raised stemming from an internal report that found “widespread” employee dissatisfaction with the pipeline’s operation and raised serious concerns with the management culture at Alyeska, U.S. Rep. Bart Stupak said.

Stupak, a Michigan Democrat, sits on the House Energy and Commerce committee. He said staff from his Subcommittee on Oversight and Investigations met with Hostler last week to express those concerns.

“Mr. Hostler’s early retirement does not come as a surprise and I wish him the best in his retirement,” Stupak said.

He said he expects that the group that will choose Hostler’s replacement will find someone with “the character and management style to move the company forward.”

Egan said an investigation of employee concerns by a third party, attorney Charles Thebaud, found “some issues about people’s comfort level, raising issues beyond their supervisors.” She said Alyeska is working to improve communication throughout the organization and “none of the safety or environmental concerns were substantiated.”

A copy of the report was not released; Egan said the company wants to maintain an open work environment and not compromise the anonymity of employees or their ability to raise questions. As a result, she said even Alyeska management did not have a copy of the report.

Thebaud, who has extensive experience in whistleblower litigation, according to his law firm biography, did not immediately return a call seeking comment. The ombudsman focused on BP operations was unavailable Wednesday for comment.

Alyeska touted the pipeline’s safety record under Hostler’s watch. Among other things, it said employee safety performance improved during his tenure and that the line went a year — or roughly 5 million man hours — without a worker injury resulting in days off work. It said that was a first in the line’s history.

In May, the line was shut down for nearly 80 hours, its longest period in at least a decade, after Alyeska said a power failure during a planned shutdown allowed several thousand barrels of oil to spill into a partially filled storage tank. The tank, in turn, overflowed into a containment yard. The storage tank was the site of a fire three years earlier.

Overall, the line has had a generally good safety and maintenance record, said state Rep. David Guttenberg. But in a letter to the state pipeline coordinator Mike Thompson last month, the Fairbanks Democrat said he is becoming “increasingly concerned that the company is headed down a dangerous road in its efforts to contain costs.”

“Leaving pump stations unmanned and moving critical integrity management personnel hundreds of miles away from the pipeline flies in the face of common sense when it comes to spill prevention and response,” he wrote.

Thompson said he was finalizing a response to Guttenberg but declined to comment on that immediately.

Egan said she is “absolutely” confident in the safety of the line. Among the reasons for moving about 30 workers to Anchorage was to allow for a “synergy” between departments, she said. Alyeska also felt it was a good business decision to have engineers together, she said.

“We continue to maintain that focus on safety,” she said.

Associated Press Writer Matthew Daly in Washington contributed to this report.

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