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Congress Investigates Alaska BP Pipeline Leak


Time now for business news.

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House lawmakers hold a hearing today into the causes of the pipeline corrosion at the nation's biggest oil field that forced a major shutdown. Oil spilled from corroded pipelines onto the tundra of Alaska's giant Prudhoe Bay field in March, and then again last month.

Although the spills were small, the resulting shutdown was large. It's draining some 200,000 barrels a day from world oil markets. NPR's Scott Horsley reports.

SCOTT HORSLEY: BP never saw the corrosion until too late because it wasn't looking in the right places.

Pipelines carrying water, or a mix of water and oil, are expected to corrode. But the pipelines that sprang leaks in March and August carried oil from which corrosive water had already been removed. Those lines were the last place field manager Kemp Copeland would have expected trouble.

Mr. KEMP COPELAND (Prudhoe Bay Field Manager): The process oil line was viewed to be pretty benign. So having corrosion this hard and this fast is certainly a surprise for us.

HORSLEY: Over the years, BP's monitoring program reinforced the assumption that the oil lines were safe. The company took ultrasound measurements from outside and dropped chunks of metal inside to test for wear. In annual reports to the state, BP said it found corrosion levels were consistently very low.

But BP's sampling process was akin to tasting a few apples and concluding the whole barrel is sound. Spots of isolated corrosion were hiding in the shadows.

Mr. DREW HEVLE (Corrosion Expert): It would be an easy problem to fix if you knew exactly where it was going to happen. But it's such a low risk, and it's so difficult to identity exactly where it's going to occur, and that's what makes it tricky.

HORSLEY: Drew Hevle is a corrosion expert who teaches courses for the National Association of Corrosion Engineers. He says the only way to test every inch of pipe is to send a device called a smart pig through the inside, measuring for corrosion all along the way.

Mr. HEVLE: A smart pig is, it's the gold standard, but it's not something you can use to do annual type monitoring because it's so expensive and it interferes with operations.

HORSLEY: In fact, BP hadn't used a smart pig on some of its corroded lines for at least 14 years.

The company's explanation is that sending the device through its lines would have pushed unwanted sediment downstream, into the larger TransAlaskan Pipeline. But Hevle suggests cost is also a consideration.

Mr. HEVLE: It's very difficult to say what is a minimum appropriate amount of work to do to ensure that this very, very low risk thing doesn't occur.

HORSLEY: Vice Admiral Thomas Barrett, who heads the U.S. Transportation Department's Pipeline Safety Administration, says whatever that minimum is, BP fell short.

Mr. THOMAS BARRETT (Pipeline Safety Administration): The standard of care they exercised, the actions they were taking, were well below what we typically see from other operators with these types of lines.

HORSLEY: BP Alaska President Steve Marshall told state lawmakers last month his company believed its anticorrosion efforts were as strong as any program in the world. The company is now faced with the task of replacing some 16 miles of oil lines in Prudhoe Bay.

Five years ago, a consulting firm hired by the state of Alaska to review BP's anticorrosion efforts, wrote in a draft report, quote, smart pigging is the only inspection technique capable of looking at the whole internal and external corrosion picture. After BP objected that the draft was too critical, that line, and others, were dropped from the final version.

Copies of both reports were posted on a government watchdog Web site by Chuck Hamel, a long-time critic of BP.

Mr. CHUCK HAMEL (Oil Industry Watchdog): You read it and tell me if it isn't a whitewash. You've got paragraphs critical of BP, and in a new report, the replacement report, it lauds them as doing a great job.

HORSLEY: After the March oil spill, the Transportation Department ordered BP to run smart pig inspections of all the suspect oil lines by June. But the company missed the deadline. Finally, more than a month later, BP got around to pigging its eastern pipeline. That's when it discovered more corrosion and another small spill that forced the partial shutdown.

Touring the area a few days later, Alaska Governor Frank Murkowski said the state government has two concerns: protecting the environment from oil spills and protecting the millions of dollars in tax revenue the oil field produces every day.

Governor FRANK MURKOWSKI (Republican, Alaska): You've got to recognize that this shutdown is detrimental to the state. It's detrimental to the producers as well. Everybody is a loser here.

HORSLEY: Admiral Barrett insists that for the federal government, safety, not oil production, is the top concern. But he's allowed BP to keep operating the western half of Prudhoe Bay, even though the company still hasn't run a smart pig through its oil lines there, and doesn't expect to do so for months.

Admiral Barrett says he hasn't seen any evidence of corrosion in the area that would require a shutdown, but just like BP, he hasn't looked everywhere.

Scott Horsley, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.