Shell extends open season for Houma-to-Houston reversal project to April 27

HOUSTON, Texas - Shell Pipeline announced on March 8 the start of a binding open season period for firm capacity on the Houma-to-Houston pipeline system reversal project (Ho-Ho Reversal).

To accommodate requests by shippers for final management approval for commitments, Shell Pipeline has extended the Ho-Ho Reversal Project Open Season by one week. The open season will now close on April 27 at noon CDT.

Shell Pipeline's Ho-Ho Reversal project will provide pipeline access to additional crudes across the 300 miles of the U.S. Gulf of Mexico refining complex. Those crudes include the domestic crude oil production increases in Texas and the mid-continent including the Barnett, Eagle Ford, and Bakken shale plays, as well as the growing crude supplies in the Cushing, Okla., area.

Additionally, the Ho-Ho Reversal project would complement the new pipeline infrastructure that is currently being built to the Houston area.

Shell Pipeline's project would reverse the existing Ho-Ho service to connect the Houston and Port Arthur, Texas, markets with the Louisiana markets. The Ho-Ho Reversal could enable the distribution of approximately 300,000 bbls. per day (b/d) of crude across the region depending upon crude types shipped.

Koch could be spoiler in sale of Colonial stock to Korea

ALPHARETTA, Ga. – If you believe the media coverage, Chevron’s sale of its 23.44 percent interest in Colonial Pipeline Co. for $847 million to the National Pension Service, South Korea’s biggest investor, is a done deal.
The Korea Economic Daily reported on Aug. 23. that the pension fund was picked as a preferred bidder to buy Chevron Corp.’s 23.44 percent interest in Colonial Pipeline Co. for about one trillion won.
What the coverage did not note is that existing stockholders have right of first refusal in any sale of Colonial stock.
According to its Web site, Colonial is currently owned as follows:
23.44% - Chevron Midstream Investments
16.55% - ConocoPhillips Pipe Line Co.
15.80% - IFM(US) Colonial Pipeline 2
28.09% - Koch Capital Investments Co., LLC
16.12% - Shell Pipeline Co. LP
Before Chevron could sell its interest to National Pension Service, the other stockholders would have to waive their right of first refusal.
Of the existing stockholders, the one with the most to gain by exercising its right would be Koch Capital Investments, a subsidiary of Koch Industries. By adding 23.44 percent to its existing 28.09 percent interest, Koch would end up with a 51.53 percent controlling interest in Colonial.
Koch Industries already owns Atlanta-based Georgia-Pacific.

Latent hurricane damage investigated in Eugene Island pipeline accident

HOUSTON - Investigators are assessing whether latent damage from recent hurricanes contributed to the Eugene Island pipeline leak in the U.S. Gulf of Mexico in July, a federal pipeline agency spokesman said on Sept. 1.
Damon Hill, spokesman for the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA), said the issue is an ongoing concern after recent active seasons featuring several strong storms.
"We do know that a lot of pipelines were affected in the Gulf from past hurricanes, especially when Katrina and Rita came. There were a lot of after-effects," said Hill, whose agency is leading the inquiry.
The U.S. Minerals Management Service, part of the investigation team, acknowledges the possibility of undetected damage after offshore oilfields were raked by storms, notably Ivan in 2004, Katrina and Rita in 2005 and Gustav and Ike in 2008.
"So far, we have not seen a trend of damage showing up later. Of course, with back-to-back storms, it may be hard to determine," said Eileen Angelico, spokeswoman for MMS.
Pipeline operator Shell Pipeline, which has said it expects to have the line repaired and back in operation by late September, declined comment on potential causes.

Coast Guard says Eugene Island oil leak cleanup completed

HOUSTON - Workers on Aug. 3 finished cleaning up 1,500 barrels of crude oil that leaked from the Eugene Island pipeline, according to a joint news release issued by the U.S. Coast Guard and operator Shell Pipeline Co.

Shell said it would repair and restart the line but did not say when.

The pipeline was shut down July 25 after the leak was discovered 33 miles off Houma, La.

Some 80,000 of the 100,000 b/d of crude oil the line was carrying when the leak occurred has been rerouted, Shell said earlier.

Divers found a crack in the line. Shell has given no other details about the damage, what might have caused it or how it might be fixed.