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Safety of Alaska oil tanks questioned

May 24, 2006 | Fiancial Times

The safety of massive oil tanks in Alaska is being questioned this week as the House of Representatives prepares to debate opening more of the state’s environmentally protected areas to oil exploration.

The tanks, owned by Alyeska Pipeline Service a company owned by oil giants BP, Exxon and ConocoPhillips were investigated several years ago and deemed fit for service. But this month a member of the Joint Pipeline Office (JPO), which combines federal and state regulators to ensure the safety of Alaska’s oil industry, approached Glen Plumlee, a former senior financial analyst at Alyeska, to discuss the situation again, Mr Plumlee said.

Mr Plumlee detailed the concerns of the JPO employee in a letter to Chuck Hamel, a former Alaska oil worker who brings whistleblower complaints to regulators.

The letter revives the earlier claims of faulty welding, saying regulators under the JPO agreed to permit the work despite the risk posed to the environment.

“Catastrophic failure of even one Valdez tank could endanger the entire terminal, pollute Prince William Sound on the order of the 1989 Exxon Valdez spill, as well as stop a substantial portion of the entire domestic US crude oil supply while the terminal is repaired and the spill contained,” Mr Plumlee said.

The letter states that if even one tank, each of which holds 510,000 barrels of oil, should give way, the environmental impact would be disastrous. The Exxon Valdez spill, the largest ever in the US, leaked 260,000 barrels of oil.

Rhea DoBosh, JPO spokeswoman, said a JPO employee was contacted by an Environmental Protection Agency investigator a week ago to discuss employee concerns about the tanks. The JPO employee, who has asked for anonymity, told the FT that he would have to get permission from the agents before discussing the issue and referred further questions to Ms DoBosh.

Both the JPO and Alyeska deny any problem with the welding, as they did previously.

“There is no integrity risk regarding the crude oil storage tanks at the Valdez Marine Terminal,’’ said Mike Heatwole, Alyeska spokesman. “The issues we’ve been discussing are old issues that have been thoroughly reviewed – internally and externally.’’

Regardless of how the matter unfolds, the allegations are likely to renew concerns about Alaska’s oil industry in the House debate. The industry has recently been criticised for a big spill and corrosion issues at Prudhoe Bay, north America’s largest oil field, which is co-owned by Alyeska’s owners.

People in Alaska have expressed their own concerns. “We don’t want a full tank of oil coming down the hill into our water,” said Stan Stevens, president of the Prince William Sound Regional Citizens’ Advisory Council, a congressionally mandated group charged with environmental oversight of oil terminals and tankers in the area.

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