Alaska Environment Regulator Issues New Pipeline Rules

CALGARY Jan 05, 2007 (Dow Jones Newswires)

The Department of Environmental Conservation or DEC, Alaska's environmental regulator, has quietly issued a new set of regulations designed to improve the monitoring of its oil pipelines.

The regulations, which came into effect at the end of December 2006, comprehensively revise Alaska's standards for preventing oil pollution, said Craig Wilson, an environment program specialist with the DEC.

"The new regulations provide additional and improved oversight to reduce the potential for future spills," Wilson told Dow Jones Newswires in an interview.

Previously, Alaska had been operating under crude pollution regulations that were drawn up in 1992, standards that have come in for heavy criticism in the wake of the serious oil spills seen in 2006.

Not only did BP PLC (BP) suffer an oil spill at a transit line on the North Slope in March, but the firm was forced to partially shut its giant Prudhoe Bay oil field in August after finding severely corroded pipelines, with a lack of adequate corrosion monitoring programs seen as a possible cause of the problems.

The DEC actually began developing its new regulations two and a half years ago, well before 2006's problems, Wilson said. The new rules cover a wide gamut of issues, including design and construction standards for crude storage tanks, pipeline inspection standards, and personnel training, he said.

A particular area of improvement is that Alaska is now regulating so-called "flow" pipelines, which weren't previously regulated, Wilson said. Flow lines carry a mixture of oil and water from the wellhead to processing centers, where the water is stripped out of the mixture.

Corrosion from water contamination, which is more likely to occur in maturing wells, is seen as a key cause of many pipeline leaks and problems.

"It's an important regulation, particularly for some of the aging wells and pipelines on the Alaska North Slope," Wilson said.

Copyright (c) 2007 Dow Jones & Company, Inc.