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The flow has slowed through the trans-Alaska oil pipeline

And it's likely to keep declining over the next decade, possibly causing dangerous ice and corrosion problems and hampering delivery of North Slope oil to the rest of the U.S.

August 10, 2010|By Kim Murphy, Los Angeles Times

Reporting from Anchorage —

In 1977, one of the engineering marvels of the modern world made its debut: the trans-Alaska pipeline, 48 inches of steel traversing 800 miles, three mountain ranges and more than 800 rivers and streams.

In its heyday in the 1980s, the pipeline carried as much as 2.1 million barrels of oil a day from America's largest oil field at Prudhoe Bay to the port of Valdez. Alaska was transformed into a petro state with an oil savings account worth $33.3 billion.

Today, however, the pipeline is carrying only about 660,000 barrels of oil a day, and production from the North Slope's aging fields is set to steadily decline over the next decade.

What this means for the continued delivery of oil to the rest of the U.S. from Alaska is significant. Engineers have warned that the pipeline — the only means of delivery of North Slope oil — will develop potentially dangerous problems with corrosion and ice if flows drop below 500,000 barrels a day, as they are expected to within the next five to 10 years.

At 350,000 barrels a day, which pipeline operators say could happen by 2022, frost heaves could cause the underground portions of the pipeline to dangerously wrinkle and kink.

Already, oil that once took 4½ days to surge from Prudhoe Bay to Valdez now crawls through in 14 days, with flow rates slowed to 2 mph.

Upgrading the pipeline to handle lower flows is possible but will cost "hundreds of millions of dollars," according to officials from the Alyeska Pipeline Service Co., which manages the facility for the three major oil companies that own most of it.

Since closing down the pipeline means shutting off all North Slope oil — 14% of the nation's domestic production — Alyeska has been working to reengineer the structure and says it hopes to keep it operating through 2030. The company has already replaced single-speed jet turbine pumps with variable-volume electric pumps, decommissioned six pump stations no longer needed and reconfigured others.

A study to be completed in December will determine just how low the oil flow can go before the pipeline is no longer viable. Options include heaters or chemical additives to keep ice from forming, lowering the water content of the oil before pumping or redesigning the "pigs" that course through the pipeline and clean it of wax buildup. Another is to just give up and build a smaller-diameter pipe.

"We can't tell you what the end date of the pipeline is. We believe we can operate down to 300,000 barrels a day, maybe less than that. But it's going to take some significant investment," said Mike Joynor, senior vice president of Alyeska's operations division.

Alaska officials say the best way out of the pipeline dilemma is to generate new production. Yet prospects for major new oil production on the North Slope have seldom looked so grim.

The BP oil blowout in the Gulf of Mexico has prompted the Obama administration to freeze new offshore oil exploration off the North Slope; the U.S. Army Corps of Engineers has rejected a key permit to allow access across the Colville River to expanded drilling in the National Petroleum Reserve-Alaska; the U.S. Fish and Wildlife Service is reviewing calls for permanent wilderness protections for the Arctic National Wildlife Refuge, which holds up to 15 billion barrels of oil; and oil companies are balking at spending the estimated $40 billion needed to coax new oil out of existing fields, partly in protest of Alaska's oil production taxes, raised significantly under the administration of former Gov. Sarah Palin.

"We need more oil for that pipeline. But ANWR [the Arctic refuge] is locked up to the east, offshore is now locked up in federal waters, and to the west, in the NPR-A, they declined a permit to ConocoPhillips to move forward," Gov. Sean Parnell said in an interview.

"We are now blocked on three sides, with the remaining state land in the middle," he said.

Conservationists who have urged a slowdown in the march of oil development into the vulnerable regions of the Arctic coastal plain and outer continental shelf, home to threatened polar bears and bowhead whales, concede the problem with pipeline flows but say the oil companies, including BP, ConocoPhillips and ExxonMobil, are using the threat of a pipeline shutdown to get access to more oil without paying for the scientific studies needed to do it safely.

"These are the richest corporations in the world, and they're being crybabies. Yes, putting oil in a pipeline in the Arctic is very, very hard. I admire their science and engineering, and by God they ought to do more of it and quit crying about it," said Jim Ayers, a Juneau-based conservation consultant and former chief of staff to ex-Gov. Tony Knowles.

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