Wednesday, July 6, 2011

Exxon has yet to craft Montana pipeline fix plan

Tue, Jul 5 2011

* No date for restart as investigation continues
* High river levels hampering investigation of cause
* Refinery at "minimum rates" until secure other supply (Recasts, updates details about spill, adds comments from pipeline company president)
By Kristen Hays and Erwin Seba
HOUSTON, July 5 (Reuters) - Exxon Mobil Corp (XOM.N: QuoteProfileResearchStock Buzz) does not have a definite repair plan yet for the ruptured Montana crude oil pipeline that it shut over the weekend, and company and government officials are still trying to determine the cause of the spill, a top executive said on Tuesday.
The company and state and federal investigators are "working in parallel, looking at both the investigation, trying to determine what happened, as well as possible repair plans," Gary Pruessing, president of Exxon Mobil Pipeline Company, told reporters in a briefing.
"We do not yet have a definitive plan on when we will be able to restart the line," he said.
Exxon estimated that up to 1,000 barrels (42,000 gallons) of oil spilled into the rain-swollen Yellowstone River when its Silvertip crude oil pipeline ruptured late Friday. Exxon said it shut the 40,000 bpd pipeline early Saturday within seven minutes of discovering a pressure loss that indicated a rupture.
High, rushing water in the river was hampering the probe, but Pruessing said the company hadn't confirmed any soiled areas beyond 25 miles downriver.
"River levels continue to be very high, the river is very strong, that does become something we need to consider in trying to get at the actual site where the incident occurred," Pruessing said.
He said Exxon may use directional drilling to reach the rupture site.
"We need to give the experts a little bit of time to determine the safest way to do the repair," he said.
The U.S. Pipeline and Hazardous Materials Safety Administration and the Environmental Protection Agency are investigating the cause of the spill, along with Exxon Mobil and Montana state environmental regulators.
Sherman Glass, global president of Exxon's refining and supply, said the company's 60,000 barrel-per-day (bpd) refinery in Billings, Montana, was running at "minimum rates" as the shut pipeline is its primary source of crude supply.
Glass said Exxon was working with other refineries in the area to line up additional crude supply, with "some success," and that the plant would have adequate gasoline and diesel for customers "for at least the next couple of weeks."
"We're optimistic that over the next few days we'll line up the crude needed to keep the refinery running. Maybe not at full rates, but certainly running well," Glass said.
Last year Enbridge Inc (ENB.TO: QuoteProfileResearchStock Buzz) experienced two larger leaks from ruptured crude oil pipelines.
Nearly a year ago Enbridge's (ENB.TO: QuoteProfileResearchStock Buzz) 290,000 bpd Line 6B, which runs from Indiana to Ontario, was shut for nine weeks after it ruptured and spilled 19,500 barrels (819,000 gallons) of crude oil into the Kalamazoo River system. The line feeds refineries in Detroit, Toledo, Ohio and several in Canada.
In September Enbridge's 670,000 bpd Line 6A, which feeds Chicago-area refineries as well as the Cushing, Okla. crude oil hub, leaked 6,100 barrels (256,200 gallons) of crude near Romeoville, Illinois, and was shut for about two weeks. (Additional reporting by Anna Driver; Editing by David Gregorio)

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