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Photo by M. Scott Moon
Flood waters pass by the Drift River tank storage facility following the last eruption of Mount Redoubt in 2009. Drift River's new owner, Hilcorp Alaska, LLC, wants to reopen part of the facility, which stores oil from offshore platforms standing in the west side of Cook Inlet

Hilcorp hopes to reopen Drift River

Posted: May 25, 2012 - 7:29am  |  Updated: May 25, 2012 - 8:18am

An oil and gas company plans to reopen a recently mothballed oil tank farm on the west side of Cook Inlet to help it meet its goal of doubling oil production, officials confirmed at a Wednesday meeting.

John Barnes, Hilcorp Alaska LLC Senior Vice President of Exploration and Production, said the company hopes to bring two tanks back online at the Drift River facility located at the base of Mount Redoubt, an active volcano, by October. The proposal -- which includes raising the height of a protective barrier surrounding the facility and amending the facility's spill plan -- is being considered by the state.

Bo York, Hilcorp Facilities Engineering Manager, said Drift River is a critical piece of Cook Inlet oil production infrastructure.

"Without Drift River we don't operate as designed," York said. "So we need that critical component back into the mix to produce our oil ... store our oil and transport it to the other side."

The Drift River tank farm was drained of oil following the 2009 Redoubt eruption when volcanic mudflows caused flooding around the facility's protective berm.

No oil was spilled at time, but York said the event resulted in five to seven feet of sediment deposits around the berm. To compensate for the increased land elevation, he said Hilcorp plans to raise the 20-foot barrier another 15 feet. Hilcorp is working with the state to make sure that action is sufficient, he said.

"The raising of it 15 feet is 100 percent a design call by the (Hilcorp) engineering folks ...," he said. "The state is involved in the process and will determine the sufficiency of that, but the ... state isn't telling us, 'You have to raise it 15 feet.'"

Currently, oil produced from Hilcorp's Cook Inlet assets -- recently acquired from Chevron -- is moved from the Granite Point and Trading Bay storage tanks by a "tightline operation," which allows only for a finite amount of storage. Most of the oil is moved straight from the pipeline to an oil tanker ship docked at the Christy Lee Platform two miles offshore from the Drift River tank farm.

Bringing the two Drift River tanks back into normal use would allow for less tanker ship traffic, York added.

"The easiest way to explain it is we offload every 12 to 14 days," said York. "A vessel comes into Cook Inlet and they'll offload 100,000 to 120,000 barrels of production. If we double production, which is our intent, then you've got a vessel coming every seven days and they are just doing laps between Nikiski and the tank farm. That's not feasible. That's why the tank farm was put in there in 1966 when production was four times what it is right now."

Also tankers unloading at the facility are currently only filled to half capacity due to storage issues, Barnes said.

"Doubling production -- that's hurdle one and now (tankers) are running every six days," Barnes said. "What if you two-and-a-half-times it? It just gets to be unmanageable. It is not a real viable, long term solution."

Betty Schorr, Industry Preparedness Program Manager for the Alaska Department of Environmental Conservation, said the state has agreed to let Hilcorp use one tank through the summer if needed.

Comments are currently being taken on Hilcorp's two-tank plan. The state also has a number of requirements of Hilcorp, including submitting a revised oil discharge prevention and contingency plan, re-inspecting those two tanks and submitting an "in-depth volcano response plan" among others, according to information provided by Hilcorp.

"We needed certain assurances before they could put that tank farm back in service," Schorr said. "So it was up to Chevron to do the evaluation of that diversion dike ... and there was a laundry list of things we wanted them to provide before they put the tanks back into service and quite frankly Chevron just decided not to do it."

When asked if Drift River was still a safe location to store oil, Schorr said she thought the facility had a "fairly good track record" and the state wants to maintain that record.

"They have to meet our regulatory requirements, period, no matter where they are and unfortunately we live in a state that has earthquakes and tsunamis and lots of risks that could happen anywhere and not just Drift River," she said. "So as long as they are meeting our state requirements ... that's the only standard I can apply to them."

Comments on the plan are being accepted through June 4. Write to: Alaska Department of Environmental Conservation, Division of Spill Prevention and Response, Industry Preparedness Program, 555 Cordova Street, Anchorage, AK 99501, or call 269-3094.

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kksalm
247
Points
kksalm 05/25/12 - 08:18 am
0
0
At the base of an active volcano.

That just about sums it up. Is it safe? You betcha. "a fairly good track record" Another delusional corporate oil company coming to a location near you!
Oh wait, there was a reason it's not in operation now. Could it be it lies directly in the depris path of an active volcano? Here's a link to what a depris path is.
http://ir.canterbury.ac.nz/bitstream/10092/3076/1/thesis_fulltext.pdf
According to this Clarion article Hilcorp has already penciled in the fact they have to open Drift River to achieve their bottom line.
What a hoot!

potomac
191
Points
potomac 05/25/12 - 09:54 am
0
0
Drift River oil storage

It is a miracle no major oil spill has taken place there. It sits smack in the middle of the flood plain coming off the volcano. No one can predict what a volcano can or can't do, 15 more feet of berm? Where is that coming from? How can an oil company police their own work etc.? A complete evaluation by the federal Government is in order, not the oil company or the state folks that already think it is the same risk everywhere in Alaska! Time for folks that fish and live in Cook Inlet to get involved, go to the big boys in Washington (not Don Young!!) and get some answers or sue them, it is your right.

NHam
3
Points
NHam 05/25/12 - 11:03 am
1
1
Drift River

When Chevron announced last fall, Oct. 12, that its Cook Inlet assets were being put up for sale, the company’s Alaska general manager, John Zager said the company was “proud of our legacy and the dedicated and talented workforce that has developed and operated these assets SAFELY and RESPONSIBLY for many years.”
This same talented world class workforce continues to operate SAFELY and RESPONSIBLY today under Hilcorp, they undergo rigorous training and are under the scrutiny of many agencies. They know the facility and the topography of the area better than those of us just glancing across the Inlet.

spwright
1376
Points
spwright 05/26/12 - 06:26 am
0
0
Flood Plain

It's my understanding that If a person choses to build a Home
in the middle of a Flood Plain then that homeowner can not get homeowners insurance for that home.

Well DUH ! Build a petroleum storage tank farm in the middle of a Proven Flood Plain & directly down stream from a Active Volcano. How Smart is That ? Flowing Magma @ 2000 degrees mixed with Oil Storage Tanks W T ? Over ?

SPW

potomac
191
Points
potomac 05/27/12 - 10:19 am
0
0
tanks full of salt water

Funny no mention about all the rust etc. are in these tanks since they filled them with salt water so they wouldn't float away after pumped the oil out during the eruptions??? I remember them saying the tanks would be unusable once they contaminated them with salt water.....so did they or didn't they pump the oil out and fill them with salt water???? How can they suddenly decide they can use a few tanks that are there???

soldotna
50
Points
soldotna 05/27/12 - 11:48 am
0
0
You know what they say about assumptions

First off kkslam You do know that Drift River is 17 miles away from Mt. Redoubt? If you look at the picture used in this story that was taken when there was flooding in the area you can plainly see the "Natural debris path" is not strait though Drift river but to the left of it and to the right of it. You can also see that the Dike system did hold up by how little the snow was washed away in the photo. Was there some flooding? Of course there was flooding were the Dike had access points to drive though water did get though following the roads and flooded the inside of some of the buildings. If the volcano went of again tomorrow would or could this happen again? Well because of global warming it is doubtful you would see the same kind of flooding. Last time there was a huge glacier that caused most of the flooding and the glacier is most all melted away now. So less water/ice would equal less flooding over all. So basically mother nature threw her best efforts at Drift River and its still standing with no disasters and all tanks in place with no floating away.

To Potomac the pipeline and the tanks across the inlet have been in use longer then they have been getting oil out of the North slope with little to no notable spills. With in the last 4 years there were 100's of millions of dollars put in to the pipeline making sure is can and will be ran safely for years to come. Also the tanks and been completely cleaned out of all water, salt, and other debris.

Norseman
3616
Points
Norseman 05/27/12 - 12:44 pm
0
0
You don't have to be a rocket

You don't have to be a rocket scientist to realize that the drift river oil facility is a disaster just waiting to happen. Having talked to some of men that were there the last time it flooded, it is a no brainer, this is a disaster in the making.

kenai_kid
222
Points
kenai_kid 05/27/12 - 08:34 pm
0
0
Rocket Scientists abound

Noreseman, building cities on major active seismic faults (San Francisco, Los Angeles, St, Louis and Anchorage to name a few) are major disasters waiting to happen. The operation od a pipeline terminal in a tsunami risk area. Building a city below sea level and then rebuilding it after a disaster are other examples.
My point is, you are correct, it is a disaster waiting to happen, just as the above listed pending disasters. We are willing to accept some risks and not others.

Norseman
3616
Points
Norseman 05/28/12 - 06:25 am
0
0
The cities you cited were

The cities you cited were built long before we had the scientific data to realize this was a poor location. I agree that too rebuild cities in disaster areas is just pouring money into a hole.
Our ancient ancestors were not as dumb as we are. When they put up a camp or village and it proved to be less than desirable, they moved on. We call that today, common sense.

Now common sense goes out the window and we build or rebuild in places that are trouble in the making.

As long as big oil and corporations funnel billions of dollars from super pacs into elections which basically buys there ex employees /lobbyists into governorships, we will continue to see decisions that benefit them, not the people who call this home.

Now we have another big oil employee running for senate (soldotna mayor micche/spelling?). They realize that bribing our legislatures will eventually get exposed, so now just spend the money in campaign funds and put their own employees in the drivers seat so when it comes to legislation, they will have a lock.

Bottom line is the drift river facility is in a recognized volcanic flood plain and should not be used for storing oil. That my friend is just plain common sense.

soldotna
50
Points
soldotna 05/28/12 - 07:33 am
0
0
Let me ask you this then

What year did the Drift river Facility open for operations? Also how many times since Drift River went operational has Mt. Redoubt went off? Last but not least how is a company like Hill Corp *less then 1500 employees* considered "Big Oil"?

By the way there are cities in the US that get pretty much rebuilt every 5 or so years that are less then 50 year old. Built smack dab in the middle of tornado alley. Also I think Alaska it self just spent millions of dollars on some villages not all that long ago to keep them from eroding away. I think some of these "villages" where not much more then summer fish camps up to about 40 years ago.

soldotna
50
Points
soldotna 05/28/12 - 07:33 am
0
0
Let me ask you this then

What year did the Drift river Facility open for operations? Also how many times since Drift River went operational has Mt. Redoubt went off? Last but not least how is a company like Hill Corp *less then 1500 employees* considered "Big Oil"?

By the way there are cities in the US that get pretty much rebuilt every 5 or so years that are less then 50 year old. Built smack dab in the middle of tornado alley. Also I think Alaska it self just spent millions of dollars on some villages not all that long ago to keep them from eroding away. I think some of these "villages" where not much more then summer fish camps up to about 40 years ago.

kenai_kid
222
Points
kenai_kid 05/28/12 - 09:03 am
0
0
Valdez

The Valdez Oil Terminal, was designed and built less than 15 years after the largest earthquake in North America in a town that was destroyed by the resulting tsunami. We knew the risk and built it anyway. St Louis, Memphis and Nashville all grew after the New Madrid fault line ruptured in 1812. We new the risk, but it didn't outweigh the reward.
Humans have always and always will measure level of risk verses reward. If risk outweighs the possible rewards, a city or project generally does not come to fruition.

Norseman
3616
Points
Norseman 05/28/12 - 04:01 pm
0
0
An ounce of prevention is

An ounce of prevention is worth a pound of cure.

alaska
36
Points
alaska 05/28/12 - 04:20 pm
0
0
Fill her up.

Fill her up.

Watchman on the Wall
2893
Points
Watchman on the Wall 05/30/12 - 01:06 pm
0
2
You don't have to be a Rocket scientist

You don't have to be a rocket scientist to see that Gods word is coming true for the End of Days either and at an alarming rate as well, but smart people in their own eyes do so every day and make fun of those that can see it clearly. I would go with a little preventative actions now while i could if i were some.
Back on the subject of bad ideas, i would say every things gonna be all right with this plan of men and why worry about it when eternity hangs in the balance for some of you and your not worried about that. Whats a little lava mixed with mud & oil gonna hurt when your dead & gone?
If the Govt. says it's OK, then you just need to accept their wisdom & go on like good sheeple and stop trying to avert troubles for many before your called whacko's for using common sence.

Philippians 2:10-11

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