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Petroleum News: BP confirms receiving subpoena in Alaska

The Associated Press

British oil company BP PLC confirmed June 8 it had received a subpoena from a U.S. grand jury investigating a massive oil leak in Alaska.

BP blamed the incident at Prudhoe Bay field in March, the largest ever spill on Alaska’s North Slope region, on a small hole caused by corrosion in a pipeline.

“We are fully cooperating with the investigation and we are carrying out our own investigation into what caused the corrosion,” BP London-based spokesman David Nicholas said. “We believe that our actions were at all times proper.”

Up to 267,000 gallons were believed to have spilled onto the frozen ground from a 34-inch diameter pipeline in the tundra about 250 miles above the Arctic Circle.

The arctic-grade carbon-steel pipe, which leads eventually to the trans-Alaska pipeline, lies above ground but is covered by a layer of gravel, as well as the snow.

BP discovered and plugged the leak on March 2.

A report prepared by a team of BP and state investigators found that a pipeline leak-detection system sounded warnings on four straight days in the week leading up to the spill, but field workers interpreted the signals as false alarms.

The report said that the leak went on undetected for at least five days “and probably much longer.”

A grand jury investigation could lead to criminal charges and ultimately fines and prison sentences.

BP is already facing a probe and victims’ lawsuits over a March 2005 explosion at its plant in Texas City, Texas, that killed 15 people. The company was fined $21.3 million by the U.S. Occupational Safety and Health Administration for 300 violations.

OSHA said earlier this year the investigation had been referred to the Justice Department for possible criminal prosecution. Justice officials have so far declined to comment.

The biggest ever spill in the Alaskan region was the 1989 Exxon Valdez shipping disaster that leaked 11 million gallons of oil onto the Alaskan coast.

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