DEC praises BP, Phillips for performance on North Slope

Posted: Sunday, March 31, 2002

ANCHORAGE (AP) -- State regulators say two of Alaska's big oil companies are keeping their environmental promises at their North Slope oil fields.

The Alaska Department of Environmental Conservation on Friday released its second annual report on how BP Exploration (Alaska) Inc. and Phillips Petroleum Co. are fulfilling a 1999 state agreement.

The charter agreement was reached before the state blessed Phillips' purchase of Atlantic Richfield Co.'s Alaska assets, which BP originally had proposed taking over. Phillips closed the $6.5 billion Arco deal in 2000.

DEC's report comes amid criticism that the oil industry is not properly maintaining the pipes, valves and other machinery at Prudhoe Bay and other aging oil fields.

Chuck Hamel, a longtime oil watchdog, said the report goes soft on the oil industry.

''The self-serving report serves only to conceal DEC's pathetically lax oversight of the public's interests on the North Slope,'' he said.

The agreement does not cover all environmental issues on the North Slope. For instance, DEC is considering fining BP for taking too long to install a system to spot oil leaks on Prudhoe Bay's huge oil trunk lines. That issue and some others are being dealt with individually.

While DEC pointed out some concerns in its report, such as ongoing corrosion monitoring, it said BP and Phillips are doing a good job of meeting obligations outlined in the agreement.

Those obligations include spending $10 million to clean up contaminated sites, investing $200,000 a year for 10 years to improve spill response preparedness, and accelerating replacement of oil tankers with a fleet of double-hulled tankers by 2007.

Among other accomplishments in 2001, according to the DEC report:

Phillips launched its first double-hulled tanker, with a second scheduled to begin operation this year. BP's first doubled-hulled tanker is scheduled to start operating in late 2003.

Phillips and BP removed 540,000 cubic yards of drilling waste from the Slope.

They began the cleanup of eight contaminated sites.

The companies disposed of 983 abandoned drums.

They reportedly spent $55 million on their infrastructure corrosion programs.

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