Jason Leopold | BP's Neglect of North Slope Pipeline Led to Disaster

Wednesday, 09 August 2006 06:00 by: Anonymous

    BP's Neglect of North Slope Pipeline Led to Disaster
    By Jason Leopold
    t r u t h o u t | Perspective

    Wednesday 09 August 2006

    BP announced Sunday that it intends to shut down the Prudhoe Bay oilfield in Alaska's North Slope later this week because of a severely corroded portion of pipeline and an ensuing oil spill, the latest in a series of mishaps that have plagued the petroleum giant's drilling operations in the region.

    The Prudhoe Bay field accounts for 8 percent - or 400,000 barrels per day - of the country's domestic crude supply. The Organization of Petroleum Exporting Countries (OPEC) said Monday it would increase output to offset the shortfall. Production at Prudhoe Bay began in 1977, and during its peak in the 1980s the field produced more than 1 million barrels of oil per day.

    Bob Malone, chairman and president of BP America Inc., said at a press conference Monday that he could not predict when drilling operations would resume.

    Republican lawmakers have begun using Sunday's pipeline problems for their own political gain - mainly by renewing calls for the passage of legislation that would allow drilling in the nearby Arctic National Wildlife Refuge.

    Drilling in ANWR has been debated at least half a dozen times over the past five years. The issue is a cornerstone of President Bush's National Energy Policy. Bush claims that drilling in ANWR is crucial in order for the US to cut its dependence on foreign oil.

    But if there were ever an argument against drilling in the pristine Wildlife Refuge, it would be Sunday's pipeline disaster at BP's Prudhoe Bay operations.

    Just four months ago, the worst spill in the history of oil development in Alaska's North Slope forced the closing of five oil processing centers in the region.

    Alaskan state officials said that as much as 260,000 gallons of crude oil leaking out of a pipeline in an oil field jointly owned by Exxon Mobil, BP, and ConocoPhillips blanketed two acres of frozen tundra near Prudhoe Bay - just a short distance from where President Bush has proposed opening up ANWR to drilling.

    The oil spill in March went undetected for about five days before a BP oilfield worker noticed the scent of hydrocarbons while driving through the area, which led him to believe there was a spill from one of the facilities.

    That spill was blamed on a corroded transit pipeline, according to BP officials.

    BP has long been criticized for poorly managing the North Slope's aging pipelines, safety valves and other critical components of its oil production infrastructure. The company has in the past made minor improvements to its valves and fire detection systems and hired additional employees, but has neglected to maintain a level of safety at its facilities on the North Slope.

    Chuck Hamel, a highly regarded activist based in Alexandria, Virginia, who is credited with exposing dozens of oil spills and the subsequent cover-ups related to BP's shoddy operations at Prudhoe Bay, sounded early warning alarms about the issues at BP's North Slope facilities.

    Back in the 1980s, Hamel was the first person to expose weak pollution laws at the Valdez tanker port as well as electrical and maintenance problems with the trans-Alaska oil pipeline.

    Hamel has said that not only do oil spills continue on the North Slope because BP neglects to address maintenance issues, but the oil behemoth's executives have routinely lied to Alaskan state representatives and members of the United States Senate and Congress about the steps they're taking to correct the problems.

    Concerned that BP was covering up the shoddy condition of its pipeline at its Prudhoe Bay operations, Hamel sent a letter to Senator Pete Domenici (R-NM) on April 15, 2005, saying the senator was duped by oil executives and state officials during a visit to Alaska's North Slope.

    "You obviously are unaware of the cheating by some producers and drilling companies," Hamel said in the letter to Domenici, an arch-proponent of drilling in ANWR. "Your official Senate tour [of Alaska last March] was masked by the orchestrated 'dog and pony show' provided you at the new Alpine Field, away from the real world of the Slope's dangerously unregulated operations."

    Hamel has obtained some damning evidence on BP to back up his claims. He has photographs showing oil wells spewing a brown substance known as drilling mud, which contain traces of crude oil, on two separate occasions.

    Hamel also claimed that whistleblowers had told of another cover-up, dating back to 2003, in which Pioneer Natural Resources and its drilling contractor, Nabors Alaska Drilling, allegedly disposed of more than 2,000 gallons of toxic drilling mud and fluids through the ice "to save the cost of proper disposal on shore."

    Hamel has had his share of detractors, notably BP and several Alaskan state officials, who called him a conspiracy theorist, and the federal Environmental Protection Agency.

    But Hamel was vindicated in March 2005 when Alaska's Department of Environmental Conservation confirmed Hamel's claims of major spills in July 2003 and December 2004 at the oil well owned by BP and operated by its drilling contractor, Nabors, on the North Slope, which the company never reported as required by state law.

    Hamel filed a formal complaint in January 2005 with the EPA, claiming he had pictures showing a gusher spewing a brown substance. An investigation by Alaska's Department of Environmental Conservation determined that as much as 294 gallons of drilling mud was spilled when gas was sucked into wells, causing sprays of drilling muds and oil that shot up as high as 85 feet into the air.

    Because both spills exceeded 55 gallons, BP and Nabors were obligated under a 2003 compliance agreement that BP signed with Alaska to immediately report the spills. That didn't occur, said Leslie Pearson, the agency's spill prevention and emergency response manager. BP spokesman Daren Beaudo said the company did report the spills after learning about them and said the spills weren't that big a deal.

    "In this case, the drilling rig operators did not feel this type of event qualified for reporting," Beaudo told the Anchorage Daily News in March. "Obviously the Alaska Department of Environmental Conservation felt otherwise and that's what they're saying as a result of their investigation. It's a matter of interpretation."

    Beaudo said the agency's findings are in line with BP's own investigation that the spills did not cause any harm to the environment, aside from some speckles on the snow.

    But what's troubling to Hamel is that Alaska's Department of Environmental Conservation has let BP off with a slap on the wrist. The agency is not penalising BP; rather, it said that it will ensure that the company reports other spills in a timely manner.

    That plays into Hamel's other theory: that the state of Alaska is in cahoots with the oil industry and routinely fails to enforce laws that would hold those companies liable for violating environmental regulations.

    In April of 2001, whistleblowers informed Hamel and former Interior Secretary Gale Norton, who at the time was touring the Prudhoe Bay oil fields, that the safety valves at Prudhoe Bay, which kick in the event of a pipeline rupture, failed to close.

    "A major spill or fire at one of our [processing centers] will exit the piping at high pressure, and leave a half-mile-wide oil slick on the white snow," Hamel said at the time in an interview with the Wall Street Journal.

    Secondary valves that connect the oil platforms with processing plants also failed to close. And because the technology at Prudhoe Bay would be duplicated at ANWR, the potential for a massive explosion and huge spills are very real.

    The safety and maintenance issues that Hamel and the BP whistleblowers brought to the attention of Congress and the public five years ago were supposed to be addressed by the oil company. Back in the 1980s, Hamel was the first person to expose weak pollution laws at the Valdez tanker port and electrical and maintenance problems with the trans-Alaska oil pipeline.

    Last year, Hamel predicted that if BP continued to neglect the upkeep of its pipelines and other infrastructure, an Exxon Valdez-type disaster could result.

    Hamel accused BP's executives of lying to Alaskan state representatives and members of the United States Senate and Congress about the steps they're taking to correct the problems.

    BP remains under investigation by the Alaska Department of Environmental Conservation, which is considering civil charges against the oil giant and the corporation's drilling contractor for failing to report massive oil spills at its Prudhoe Bay operation, located just 60 miles west of ANWR.

    The situation in Alaska became so dire that a number of BP employees began to privately warn lawmakers that oil spills like the one that took place in March would happen at ANWR if improvements were not made to the oil companies' drilling equipment.

    In March of 2002, a BP whistleblower went public with his claims of maintenance backlogs and employee shortages at BP's Prudhoe Bay operations that he said could become even worse if ANWR is opened up to exploration.

    The whistleblower, Robert Brian, who worked as an instrument technician at Prudhoe Bay for 22 years, had a lengthy meeting with aides to Senators Joseph Lieberman and Bob Graham, both Democrats, to discuss his claims. But the senators have never followed up on them.

    At the time, Brian said he supported opening up ANWR to oil exploration but said BP has imperiled that goal because it is "putting Prudhoe workers and the environment at risk."

    In 2001, the Alaska Oil and Gas Conservation Commission found high failure rates on some Prudhoe wellhead safety valves. The company was put on federal criminal probation after one of its contractors dumped thousands of gallons of toxic material underground at BP's Endicott oil field in the 1990s.

    BP pleaded guilty to the charges in 2000 and paid a $6.5 million fine, and then the company continued to neglect the upkeep of its pipelines as additional spills became worse.

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