Pipeline Crack Curbs UK Feedstock Supply

13.12.2017 -

Forties Pipeline, which pipes oil and gas from the UK’s North Sea oil and gas fields to onshore energy providers and the mammoth Ineos complex at Grangemouth, Scotland, could be out of service for several weeks while a crack is repaired.

The outage in the pipeline that carries 40% of the oil processed in the UK pushed the cost of crude to the highest level in the past year and a half. Forties is the largest of five crude oil streams that underpin the Brent benchmark, against which other crude prices are loosely fixed.

Ineos only completed its acquisition of the pipeline – the UK’s biggest with capacity to carry 450,000 barrels per day (bpd) of crude – from BP in October. On Dec. 11, the Swiss-based group said it had had to close the line altogether after a partial closure due to a leak on Dec. 7.  It said the crack was discovered near Netherley in Aberdeenshire.

The problems hit amid freezing temperatures across Britain, and several energy groups, including BP, Shell and Chrysaor, have announced they will temporarily close their fields. Scottish energy minister, Paul Wheelhouse, said, however, there are no plans to shutter the 200,000 bpd Ineos refinery at Grangemouth.

Ineos initially had said the pipeline could be down for three to four weeks, but later told the news agency Reuters it was working to return it to full operation as quickly as it is safe to do so, possibly in only two weeks.