Oil starts flowing through forest fire zone

Oil starts flowing through forest fire zone

26 May 2011

published by www.ctv.ca    

Canada — Oil has begun flowing again through a pipeline shut down by forest fires, but some Alberta oil fields remain without electricity, which is likely to prolong the time it will take the oil patch to fully recover.

Operations resumed on the southern stretches of the Rainbow pipeline Wednesday at 1 p.m., according to Plains Midstream Canada, the subsidiary of Plains All American Pipeline LP that runs the line. The company had initially said the pipeline would restart Tuesday, but said in a release that “road accessibility to the site remains a challenge.”

The downed pipeline, which had been shut off when electrical service in the area was stopped, had been the chief reason companies were forced to halt production of nearly 150,000 barrels a day of crude. As it began to accept oil again, companies like Cenovus Energy Inc. and Canadian Natural Resources Ltd. worked to begin pumping oil again, although Cenovus warned that crude likely won’t flow until Thursday or even Friday, and it will take several days to reach its 22,000-barrel full output.

In a release, CNRL said it was “in the process of starting up” again Wednesday.

It may take days longer, however, for other companies to resume operations, since electricity has been only partly restored to an oil-rich area of northern Alberta located in a region afflicted by a huge mass of forest fires. Crews with Atco Electric have brought service back to the southern 80 to 90 kilometres of a 144-kilovolt transmission line that runs north of fire-ravaged Slave Lake. The company only had to fix five wooden transmission structures damaged by fire, and that fix allowed Rainbow to operate again.

But the upper reaches of the 200-kilometre line, which are located north of the Nipisi oil terminal, have yet to be fixed. That line feeds three communities and a number of oil fields, and parts of it, which run through one very large forest fire, “we’re not able to fully access,” said Barry Goy, director of distribution operations for Atco Electric. “Until we can really get in there, I’m reluctant to say exactly what the damage is going to be.”

It’s unclear which oil and gas companies remain without power. But for some companies the situation remains delicate, as fire and the risk of fire continue to pose a threat.

Penn West Petroleum Ltd., for example, now says it is working to restore output in those areas where it has received approval from police and provincial authorities.

“The process is involved, with safety a priority,” said Penn West chief executive officer Bill Andrew.

Rainbow’s southern stretch is transporting about 900 cubic metres of oil per hour now, hovering around its “typical” rate, Stephen Bart, vice-president of operations for Plains Midstream, said Wednesday. The northern portion, closed due to a spill in late April, is ready to resume operations, he said, but is waiting approval from the Energy Resources Conservation Board. The regulator asked Plains to do further testing after the company said it found an “anomaly” on a sleeve about 25 kilometres from the original spill site, and Plains has proposed testing a “random sample” of five similar sleeves. “That seems like a robust sample size that ought to confirm that this is an isolated incident,” Mr. Bart said, noting there are a “number” of sleeves on the line. The ERCB has not yet told the company whether this sample size would be acceptable, he said.

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