BP: N Sea Valhall Oil Platform Restart Not Seen Before Mid-Aug

LONDON (Dow Jones Newswires), July 28, 2011

BP said Thursday the Valhall oil platform in the Norwegian sector of the North Sea sustained modest damage in a July 13 fire, but production at the facility is unlikely to resume before mid-August while the company completes a safety review.

The fire at the Valhall platform shut down around 60,000 barrels a day of Ekofisk crude output that feeds into global benchmark Brent and comes as unscheduled maintenance at the Nexen-operated Buzzard oil field has also disrupted supplies into the benchmark, supporting oil prices.

The fire comes as BP, which operates the Valhall platform, is still struggling with the fallout from last year's Deepwater Horizon oil spill that unleashed the worst offshore oil spill in U.S. history.

According to BP spokesman Matt Taylor, damage to the Valhall platform was modest and caused mostly by water used to extinguish the fire.

"All areas of the platform are accessible to all employees," he said.

Oil production at the Valhall facility before the shutdown was 42,000 barrels a day, and it will take around two days to reach plateau production after restart, Taylor said.

In addition to the safety review, BP and Norwegian regulators are conducting two separate investigations into the cause of the fire. Results from the BP investigation are expected in September, Taylor said.

Ekofisk crude is the second largest of the four grades feeding into the Brent benchmark, that is used to price over half of the world's oil. Buzzard is the largest of the 50 fields that contribute to Forties crude oil, the main component of European benchmark Brent crude.

As a result of the fire, the entire Ekofisk loading program was delayed by three days starting from July 27 until the end of August, Ekofisk field-operator ConocoPhilips said earlier this month.

Copyright (c) 2011 Dow Jones & Company, Inc.


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