Athabasca Oil Corp. has stated that it has had to suspend approximately 84% of its light oil production after Alliance Pipeline’s shutdown of its natural gas mainline last week.
The estimated cuts
After the Alliance pipeline was infected with poisonous hydrogen sulfide, Athabasca estimated that its cuts would be equal to 4200 boe/d – cutting its light oil production guidance of 5000 boe/d in the third quarter by approximately 250.
The Alliance pipeline
Western Canada and North Dakota depend on Alliance’s mainline for natural gas when transporting to the Chicago market. The pipeline accounts for roughly a third of Canada’s daily net exports to the US, and the shutdown is predicted to last several more days.
Alliance had called on shippers to suspend injections in order for the affected gas to be flared off.
The company began flaring at its mainline block valve station in Saskatchewan, and has planned to add additional flares at its Alameda compressor station downstream too, stating: "We will continue to work to measure gas as we are flaring it to safely remove the hydrogen sulphide from our system."
Alliance means to purchase natural gas as a replacement for the lost volumes during the flaring process, which will also help to reopen the pipeline quickly.
Part 3 of the coverage here.
Edited from various sources Reuters, Rigzone, CTV News by Stephanie Roker