Alaska Oil April Output Declines in North Slope Field Fall-Off

Alaskan crude-oil production slipped 2.1 percent in April from last year in a natural decline of the state’s North Slope fields that may eventually affect operations of the Trans Alaska Pipeline System.

Production in April averaged 640,477 barrels a day, a decline from 654,366 a year earlier, according to the Alaska Tax Division. Output fell by 6,140 barrels from the previous month.

“We’re seeing a steady decline in throughput,” Katie Pesznecker, spokeswoman for Alyeska Pipeline Service Co., the pipeline operator, said in a telephone interview. “Our new president has been pretty vocal about the technical issues we are facing.”

Alaska production has declined every year since 2002, U.S. Energy Department figures show. If no new fields come online, lower volume makes it more difficult to operate the pipeline because the oil flows more slowly and cools more quickly, increasing the chance of wax buildup and water freezing in the line or gumming up pumping stations, Pesznecker said.

Oil inventories in the state finished the month at 3.88 million barrels, after dropping as low as 1.27 million barrels on April 6, according to the tax division. Production at the Northstar field dipped to less than 10 percent of usual output on April 13, probably because of maintenance, Pesznecker said.

The 800-mile (1,287-kilometer) system runs from Prudhoe Bay on the North Slope to Valdez, the northernmost ice-free port in the U.S. Oil companies and some legislators are lobbying to lower state taxes as a way to pump up investment and the amount of oil in the pipeline.

To contact the reporter on this story: Colin McClelland in New York at cmcclelland1@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.

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