BP seeks part of Alaska pipeline reopened
Oil giant asks U.S. to allow it to restart eastern part of Prudhoe Bay pipeline.
NEW YORK (CNN) -- Oil giant BP says it has requested permission from the Department of Transportation to restart operations for the eastern part of the BP Prudhoe Bay pipeline in Alaska, the part that was shut down this summer upon the discovery of severe pipeline corrosion.
The corrosion problem was discovered during an inspection ordered after an oil spill from the pipeline earlier this year. BP America announced the Prudhoe Bay shutdown on August 6.
The request, made Wednesday, is not to run oil through that part of the pipeline for customer use, the company said. "This is a request to return flow to the line, then run cleaning tools down it, and then run 'smart pig' through it," BP (down $0.93 to $64.92, Charts) spokesman Daren Beaudo told CNN Friday.
A "smart pig" is a diagnostic tool that measures the conditions of both the pipe's circumference and length, Beaudo explained.
According to Damon Hill, spokesman for the DOT's Pipeline and Hazardous Materials Administration, it will take up to two weeks for the department to review BP's request, determining whether the line is in good enough condition operate for pigging purposes.
PHMA engineers already are in Alaska examining the pipeline. "Our first priority is to the safe operation of the pipeline," Hill said.
"We are happy with the progress BP has made since our corrective action orders were issued initially in March," he added.
The oil company submitted the request after using multiple ultrasonic tests to inspect more than 5,000 feet of pipeline, and claims the pipeline is secure and the "smart pig" inspection can proceed safely.
BP issued a statement saying a bypass project is expected to finish by the end of October and the company plans to replace 16 miles of pipeline this winter.
During House Energy & Commerce Committee testimony this week, BP Exploration Alaska President Steve Marshall said the company plans to spend an estimated $195 million by 2007 on Prudhoe Bay maintenance, nearly quadruple 2004 spending.
Beaudo said that if the DOT grants BP's request, it will be a "significant milestone in this journey."
According to BP, if DOT allows the "smart pig" operation and the pipeline is found to be secure, BP's next step would be to ask to send oil through the pipeline again. Beaudo would not provide any sort of timetable.
Speaking to a House panel earlier this month, BP America Chairman Bob Malone called his company's operating failures unacceptable. "They have fallen short of what the American people expect of BP and they have fallen short of what we expect of ourselves."
Production of oil from the western side of the Prudhoe Bay oil field resumed on Aug. 11.
Earlier this month, BP hired three independent corrosion experts to review inspections of Prudhoe Bay and other Alaska oil fields the company operates.
Shares of ExxonMobile (up $0.15 to $64.86, Charts) and ConocoPhillips (down $0.32 to $58.12, Charts) were mixed in Friday trade on the New York Stock Exchange.
New BP America president Bob Malone speaks with FORTUNE about Prudhoe Bay