April 01, 2009
In March and August of 2006, spills occurred from oil transit lines (OTLs) in the Prudhoe Bay Unit operated by BPXA. Both were the result of internal corrosion that had not been adequately treated by BPXA for years. The March spill estimated at 212,252 gallons was the largest in the history of Alaska North Slope oil and gas production. The August spill involved more than 900 gallons.
The spills and subsequent emergency pipeline replacement work at both Prudhoe Bay and the Milne Point Unit significantly reduced oil production for more than two years. As a result, the state lost revenue it would otherwise have received in 2006 through 2008 had BPXA used sound corrosion management practices.
In the lawsuit, the state is requesting penalties for violations of environmental laws and just compensation for state revenues lost as a result of BPXA's negligent corrosion prevention practices.
Previously, BPXA settled criminal violations associated with the March 2006 spill through a plea agreement with the U.S. Justice Department in which BPXA pleaded guilty to violating the federal Clean Water Act.
As part of the plea agreement, BPXA admitted that the 2006 spills were caused by internal corrosion that had been allowed to progress unchecked to the point of failure due to the negligent corrosion monitoring and control practices that it had employed for several years prior to the two spills. This negligence included:
On April 18, 2007, Governor
Sarah Palin signed Administrative Order 234 creating the Petroleum
Systems Integrity Office to ensure Alaska's oil and gas infrastructure
will get the maintenance and inspection it needs to operate safely
for decades to come.
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