BP to Stop Prudhoe Bay Oilfield Production
Wolfram Donat
August 07, 2006
In a move destined to impact more than just the price of a barrel of oil, British Petroleum announced today that they will be progressively shutting down portions of the Prudhoe Bay oilfield in northern Alaska due to “excessive corrosion” in the Trans-Alaska Pipeline.
The pipeline, which runs from America’s biggest oilfield in Prudhoe Bay to the port in Valdez, transports 400,000 barrels a day from Prudhoe. It has been in the news several times over the past few months as workers have found various leaks and oil spills along the length of the 800-mile pipeline. Each of these required small shutdowns, but nothing along the lines of the massive oilfield shutdown on the North Slops. Ceasing oilfield operations is a massive, expensive undertaking, and BP officials are quite specific in stating that it would not be done if not completely necessary. They also add that despite the cost to both BP and the oil economy, they would not resume oilfield operations until both they and government inspectors are assured that the pipeline is in working order.
The shutdown is expected to cut 8% of America’s oil production, and about half a percent of global production, and according to oil analyst Peter Beutel, may cause gas prices to rise from 3 to 5 cents per gallon – not a tremendous amount, but still unwelcome news to consumers already feeling the pain at the pumps.
There is no expected reactivation date currently in the works, but BP officials caution that the repairs could take weeks or even months.
The pipeline, which runs from America’s biggest oilfield in Prudhoe Bay to the port in Valdez, transports 400,000 barrels a day from Prudhoe. It has been in the news several times over the past few months as workers have found various leaks and oil spills along the length of the 800-mile pipeline. Each of these required small shutdowns, but nothing along the lines of the massive oilfield shutdown on the North Slops. Ceasing oilfield operations is a massive, expensive undertaking, and BP officials are quite specific in stating that it would not be done if not completely necessary. They also add that despite the cost to both BP and the oil economy, they would not resume oilfield operations until both they and government inspectors are assured that the pipeline is in working order.
The shutdown is expected to cut 8% of America’s oil production, and about half a percent of global production, and according to oil analyst Peter Beutel, may cause gas prices to rise from 3 to 5 cents per gallon – not a tremendous amount, but still unwelcome news to consumers already feeling the pain at the pumps.
There is no expected reactivation date currently in the works, but BP officials caution that the repairs could take weeks or even months.
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