Alaska Oil Output Drops 7.2% on Pipeline System Maintenance

Alaska crude-oil production dropped 7.2 percent in May from a year earlier after Alyeska Pipeline Service Co., operator of the cross-state pipeline system, shut sections for work and as output from wells declined.

Production averaged 570,770 barrels per day last month, down from 614,961 a year earlier and 577,552 in the previous month, the state Department of Revenue said on the agency’s website. Production peaked for the month at 591,966 barrels on May 3 and fell to a low of 530,873 on May 25.

Alyeska was scheduled to shut the 800-mile (1,287-kilometer) Trans-Alaska crude system on May 18 and May 27 for work at Pump Stations 3 and 5. Alaskan output has declined annually since 2002 as falling yield from existing wells hasn’t been replaced, according to the state tax division.

E-mails seeking comment from Michelle Egan and Katie Pesznecker, spokeswomen at Alyeska, weren’t immediately returned before regular business hours.

Crude-oil output from Prudhoe Bay averaged 324,919 barrels per day in May, down from 329,105 in April, the state said.

Alaskan North Slope crude has strengthened 33 percent over the past year, trading $16.25 a barrel above the U.S. benchmark West Texas Intermediate at 9:04 a.m. New York time, according to data compiled by Bloomberg.

Inventories of the feedstock at the Valdez marine terminal averaged 5.08 million barrels last month, ranging from 4.06 million on May 4 to 5.69 million May 26, according to the revenue department.

Alyeska is owned by BP Pipelines (Alaska), ConocoPhillips Transportation Alaska, ExxonMobil Pipeline Co., Unocal Pipeline Co., and Koch Alaska Pipeline Co.

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