Barton Questions BP's Ability to Safely Maintain Pipelines
Barton Questions BP's Ability to Safely Maintain Pipelines
WASHINGTON - U.S. Rep. Joe Barton, R-Ennis, chairman of the House Energy and Commerce Committee, delivered the following statement today as part of an Oversight and Investigations Subcommittee hearing entitled, "BP's Pipeline Spills at Prudhoe Bay: What Went Wrong?":
"Thank you, Mr. Chairman, for holding this hearing today. I hope that the testimony today is going to provide us some answers about the recent crude spills on the North Slope of Alaska. I also hope that it's going to provide some answers about what's being done and will continue to be done to prevent those very serious incidents from happening in the future. The spills occurred on two transmission lines that move oil produced from Prudhoe Bay to the Trans-Alaska Pipeline. BP Exploration of Alaska, Inc. - which is an operating unit of British Petroleum - is responsible for the operation and maintenance of those crude oil transmission lines.
"I think it's obvious, but we do need to emphasize that these lines move nearly 400,000 barrels of crude oil a day to market. That's roughly 8 percent of the country's domestic oil production. Given that fact, the safe, responsible, and reliable operation of these pipelines is of paramount concern to this committee and to the country.
"It is critical that no further leaks occur on these lines. It is paramount to avoid the threat to human life and the environment, but it is also important to our national security that this oil be reliably transported on a daily basis. On Sunday, August 6, BP announced the complete shutdown of the Prudhoe Bay oil field. The following Monday the price that BP and others commanded on the world market for their crude oil jumped 3 percent, to nearly $77 per barrel.
"This decision came on the heels of an accident last March when BP's Western transmission lines at Prudhoe Bay leaked about 200,000 gallons of oil from a corroded pipe. Between that incident and the leak in August from the Eastern transmission line, BP had repeatedly assured this committee, our staffs and me personally that the corrosion of that pipeline that failed in March was an anomaly. BP told us that their corrosion control program was effective, that they were monitoring on a constant basis and they were mitigating corrosion in the pipelines at Prudhoe Bay.
"If the March leak was an anomaly, why did BP suddenly shut down production from the entire Prudhoe Bay oil field in August due to excessive corrosion discovered in the Eastern crude oil transmission lines? In fact, we now know that BP has failed to carefully inspect and maintain these pipelines. The decision to shut down the pipeline in August seems to be the direct result of a requirement to pig the Eastern line because of last March's spill on the Western line.
"Pipeline experts and other pipeline operators have explained to us that internal inspection of pipelines - what is called smart-pigging - is the most reliable, complete and informative way to assess the integrity of a pipeline's interior walls. U.S. Department of Transportation officials explained to the committee staff that BP's failure to pig these lines regularly is unsound management. Other methods are available, but pigging has a distinct advantage. I understand that pigging is relatively inexpensive on a pipeline that has been designed for it.
"We might point out at this point in time that last year BP reported record earnings of over $25 billion - $25 billion - and that the Prudhoe Bay field is and was the lodestar of BP production.
"Yet prior to this year's incidents, neither the Western nor the Eastern gathering line that BP has been operating has been smart-pigged for years. The Western line was last maintenance-pigged and smart-pigged in 1998. The Eastern line was last maintenance-pigged in 1990 and smart-pigged in 1992. By comparison, executives at Alyeska, the pipeline company operating the larger Trans-Alaska Pipeline System, informed subcommittee staff that their line is maintenance-pigged every two weeks, and smart-pigged at least once every three years. We now know that BP officials have admitted, and I'm expecting that they'll again say so today, that their corrosion control and inspection program for Prudhoe Bay was flawed, and that in hindsight BP should have been pigging these transmission lines. In hindsight. Well, hindsight is better than blindsight, I guess, but it is not a substitute for ongoing, sound management practices.
"I suppose that this committee and the Congress are expected to shrug our shoulders and say, 'Well, now they get it.' But the clever use of perfect hindsight to excuse consistent failure just doesn't cut it. Years of neglecting to inspect the most vital oil-gathering pipelines in this country is not unacceptable. BP's neglect is having, as we speak, an adverse and disruptive effect on the American economy, American consumers, and national security. That's not acceptable. If a company - one of the world's most successful oil companies - can't do simple, basic maintenance needed to keep the Prudhoe Bay field operating safely, without interruption, maybe it shouldn't operate the pipeline. Maybe we should find a way to get a different operator through the private market sale of this pipeline and let somebody else do it.
"This hearing will largely focus on BP's failure to responsibly operate the Prudhoe Bay transmission lines, but these two incidents - of which the March spill also happens to be the continuing subject of a federal grand jury - are only part of this company's recent and, unfortunately, notorious track record. The Prudhoe Bay spill comes on the heels of the BP Texas City refinery disaster that killed 15 people in 2005.
"Now I know that BP is investing significant amounts of time, energy and resources to bring Prudhoe Bay back up to full capacity and to address the very serious corrosion problems that have been discovered, but this is all after the fact. I understand that sludge and sediment issues existed in the lines for quite some time, and that BP knew about the flaws in its corrosion control program. Impurities like sludge, sediment, and water induce corrosion, and provide a place for corrosion to hide.
"Maybe I have the wrong impression, but it seems to me that BP was betting the company and their field that this field would be depleted before major parts of the pipeline failed and needed to be replaced. BP's policies are as rusty as its pipelines. I am very concerned about the specific incident, but I am even more concerned about BP's corporate culture of seeming indifference to safety and environmental issues. And this comes from a company that prides itself in their ads on protecting the environment. Shame, shame, shame.
"And I want to say something else before I conclude, Mr. Chairman. During the course of this investigation, the committee has been informed by certain individuals that we were trying to interview at the staff level, that they were reluctant to come forward to provide information due to concerns over possible retribution throughout the oil industry in Alaska. I want to make it perfectly clear, that if we find that any person is threatened, intimidated, or attempted to be retaliated against as a result of cooperating with this committee, I will use every bit of power that I have as chairman of the full committee to ensure that the retaliator is prosecuted to the fullest extent of the law. And to the extent that that retaliation against an individual is condoned by any corporate official, I will exercise the same authorities against those officials.
"We are going to get to the bottom of this. We are going to make sure that the facts are in the public purview. And we are going to, if necessary, change federal law to do everything possible to minimize this happening again.
"Mr. Chairman, I look forward to today's testimony. I hope we get the answers we need. If not, I'm sure the subcommittee will continue to conduct aggressive oversight on a bipartisan basis on this issue. With that, I yield back the balance of my time."
http://joebarton.house.gov/News.asp?FormMode=Detail&ID=359