Colonial may open key U.S. gasoline line
by Saturday after fatal blast
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[November 02, 2016]
By Devika Krishna Kumar
(Reuters) - A major gasoline pipeline that
is a crucial supply source for the U.S. East Coast could reopen as early
as Saturday after an explosion in Alabama killed one worker and injured
five others, Colonial Pipeline Co [COLPI.UL] said on Tuesday.
The blast on Monday occurred several miles from its biggest gasoline
spill in nearly two decades in September. That spill caused a 12-day
interruption in the flow of about 1.3 million barrels per day of the
fuel from the refining hub on the Gulf Coast to the Northeast.
The shutdown will restrict gasoline supplies to millions of Americans in
the Southeast and possibly the Northeast. The Northeast could be less
affected since it can get supplies via waterborne shippers.
In a news conference Tuesday, Colonial executive Gerald Beck said the
crew was putting in a valve in order to finish repairs related to
September's leak.
He said the U.S. Occupational Safety and Health Administration currently
has control of the site. The fire is still burning, and Colonial expects
to be able to get into the site in the next day or two - and from there,
determine how long a repair will take.
![](http://archives.lincolndailynews.com/2016/Nov/02/images/ads/current/topflight_west_sda_101414.png)
The 5,500-mile (8,850-km) Colonial Pipeline is the largest U.S. refined
products pipeline system and can carry more than 3 million barrels of
gasoline, diesel and jet fuel between the U.S. Gulf Coast and the New
York Harbor area.
The worker who was killed was found on-site, but his name was not
released.
U.S. gasoline futures soared 15 percent to the highest since June on the
shutdown, but pared gains sharply to 4.6 percent to settle at $1.4841
per gallon after Colonial said it could reopen the pipe by the weekend.
Colonial said it would explore potential options to operate parts of its
gasoline pipe, called line 1, and would evaluate shipping gasoline on
the distillates pipe, line 2, which was briefly shut overnight by the
incident.
During the September outage, the company shipped some gasoline on the
line that usually transports diesel and jet fuels.
"If they are properly motivated, they can do the investigation and get
the line up a lot quicker than the last one," said Richard Kuprewicz,
president of Accufacts Inc, a pipeline advisory firm, referring to the
September outage.
"My experience tells me that even with a fatality, I would not expect
this to go as long as the last one."
Shippers using the East Coast supply artery were, however, bracing for a
longer shutdown as Colonial said it was hard to predict a repair
schedule.
Shippers and fuel companies were scrambling to secure supplies via sea
or other alternatives to get fuel to the East Coast. Fuel retailers and
consumers are likely to be most affected, though prices at the pump have
not risen yet, even as gasoline futures have spiked.
The governors of Alabama, North Carolina and Georgia on Tuesday issued
regulatory waivers to allow easier transit of fuel.
North Carolina Governor Pat McCrory said at a news conference the state
gets 70 percent of its gasoline from the Colonial Pipeline.
(For a graphic on Alabama pipeline explosion, click
http://tmsnrt.rs/2eQn8jr)
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![](../images/110216PICS/news_I13.jpg)
Flames shoot into the sky from a gas line explosion in western
Shelby County, Alabama, U.S., October 31, 2016. REUTERS/Marvin
Gentry
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FATALITY COULD COMPLICATE RESTART
One person was killed and five others hospitalized in the incident
that occurred when a nine-man crew working on the line in Shelby
County hit Line 1 with a large excavator known as a track hoe,
Colonial said.
A representative for the U.S. Pipeline and Hazardous Materials
Safety Administration (PHMSA) said investigators were on the scene.
Brigham McCown, who headed up PHMSA for two years under former
President George W. Bush, said the fatality could complicate restart
efforts in upcoming days as multiple state and federal agencies
investigate the incident. However, he said the details of how the
rupture occurred may help speed the timeline.
"It's important to get out there, get on site, figure out who had
what equipment where and who was giving what orders," said McCown.
The explosion took place in an unincorporated wildlife area outside
Helena, Alabama. Colonial and the state's forestry commission were
leading the response.
Danny Ray, fire chief in nearby Pelham, Alabama, said at the news
conference that they were able to contain the fire in part because
nearby workers with bulldozers were able to build an earthen berm to
contain the burning gasoline.
Ryan Chandler, vice president at Colonial Group Inc, which is not
connected to Colonial Pipeline, said he has been fielding calls from
the pipeline's customers seeking access to its Charleston and
Savannah marine terminals.
![](http://archives.lincolndailynews.com/2016/Nov/02/images/ads/current/ccaonline_lda050208.png)
Chandler's company manages three marine terminals in the U.S.
Southeast and ships on the Colonial pipeline. He said during the
September outage, business at the Savannah terminal jumped
sevenfold, while Charleston jumped fivefold.
For inland markets in the U.S. Southeast, which do not have access
to ports, alternative supplies can be harder to get.
The September spill led to long lines at the pump and a shortage of
fuel in Georgia, Tennessee and Alabama.
(Reporting by Devika Krishna Kumar, Scott Disavino, Jessica Resnick
Ault in New York; Additional reporting by Jarrett Renshaw in New
York and Marvin Gentry in Helena, Alabama; Editing by JS Benkoe and
Lisa Shumaker)
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