Pipeline Closure Sends Oil Higher

At the center of the criticism involving BP is the decision by the world's second-largest publicly traded oil company to let seven years go by without using a smart pig on the pipeline that sprung a leak in March. The pipeline segment closed Sunday was last inspected with a smart pig in 1992, before it was acquired by BP, a company spokesman said.

Transportation Department regulations say that higher-pressure pipelines should be inspected this way every five years, at least. If companies delay pipeline cleaning, accumulations of sludge can make it impossible for a pig to move through the line.

The buildup of sludge was one reason that BP had failed to fully comply with the March order from the Pipeline and Hazardous Materials Safety Administration, part of the Transportation Department.

"It's almost like a guy who is out of shape, who has been eating cheeseburgers and whose arteries start getting clogged up and the doctor says it's time to start exercising," said a congressional aide who spoke on condition of anonymity because he did not want to appear to be speaking for his representative. "And the question is how to get back in shape without having a heart attack."

The Justice Department has asked BP to cut out a 10- to 12-foot section of pipe where the 270,000-gallon March leak occurred and to give that to the government for analysis, a source said. But there are thousands of gallons of oil in that section, creating engineering problems. Next month, after overnight freezing temperatures return to the area, those engineering problems could become more severe.

BP chief executive John Browne was in Alaska last week to try to polish the company's image and apologize for pipeline problems. BP, which used to be known as British Petroleum, has tried to cultivate an environmentally friendly image, saying that BP stood for "beyond petroleum." But yesterday an official from a competing oil company said it stood for "big problems."

"We will not resume operation of the field until we and government regulators are satisfied that they can be operated safely and pose no threat to the environment," Robert A. Malone, president of BP America Inc., said in a statement.

Prudhoe Bay's production level has been slowly declining since it hit a peak of 1.5 million barrels a day in 1989, and BP has increasingly turned to new prospects in places such as Russia.

"It's ironic," said Athan Manuel, an oil drilling expert at the Sierra Club. "This is the company we've had the best relationship with. But maybe they were taking money out of Alaska, which has aging fields, to put money elsewhere."