US offshore oil producers Shell, Chevron and Equinor on Thursday suspended operations at facilities pumping hundreds of thousands of barrels of oil a day, citing a leak in an onshore pipeline that a port official said was expected to last about a day to fix it.
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The shutdowns aren’t expected to last, but the number of assets affected by the leak provided another example of how a relatively minor outage can affect a portion of US energy infrastructure.
The closures could halt about 600,000 barrels of oil production per day, a person familiar with offshore operations said.
EXXON, CHEVRON AND SHELL’S PROFITS WILL RISE BY OIL RAIL
A flange connecting two pipelines onshore in Louisiana failed, causing about two barrels of oil to spill on the bottom, said Chett Chiasson, executive director of the Greater Lafourche Port Commission. A fix is expected to take about a day, he added.
The oil spill halted operations on the Mars and Amberjack pipelines, which supply several oil platforms off the Louisiana coast. It occurred at a booster station that helps increase pipeline pressure and propel crude oil flow to onshore storage facilities in Clovelly, Louisiana.
The Shell logo at a petrol station in London, Wednesday 20th January 2016,
Shell’s Mars, Ursa and Olympus platforms have been shut down because of the leak. The three are said to be producing up to 410,000 barrels of oil per day between them, according to the company’s website.
Chevron’s Jack/St. The Malo, Tahiti and Big Foot oil facilities, which are also connected to the Amberjack pipeline, have ceased production. Equinor said it has closed its Titan platform.
Pipeline operator Shell said it was premature to assess the impact of the closure and declined to give a timeline for when operations would resume.
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Murphy Oil, which also uses the Mars pipeline for some of its Gulf of Mexico operations, could not immediately comment on its operations, a spokesman said.
Shell’s three platforms deliver Mars Sour Crude, a variety prized by oil refiners in the United States and Asia. Shell said it was evaluating “alternative flow paths” to transport the oil to land via other pipelines.
Mars Sour crude prices rose briefly to trade at a 50 cent discount to US crude futures. Trade in the variety was volatile as it competed domestically with sour casks released from the US Strategic Petroleum Reserve and on international markets with lower-priced Russian Urals casks.
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Fourchon Port Police Chief Michael Kinler said there was no evidence of vandalism at the booster station and that the amount of oil spilled was not enough to halt traffic on the waterway or roads.
The leak happened late Wednesday or early Thursday between checks of the booster station infrastructure, Chiasson said. No waterways were affected by the spill and operations in the port were not affected, he added.