Monday, October 24, 2016

Seaway Crude pipeline system shut after Cushing, Oklahoma spill by Enterprise Products Partners

OCTOBER 24, 2016
CUSHING, Oklahoma -

The Seaway Pipeline Company is working to contain a crude oil release near Lynnwood Ave. and Texaco Rd. in Cushing.

The spill occurred early Monday morning.

As emergency responders work on clean up, law enforcement says the spill is not a threat to residents and no evacuations have been ordered.

Enterprise's Seaway Crude pipeline system shut after Cushing, Oklahoma spill

A leak late on Sunday prompted Enterprise Products Partners to shut its Seaway Crude Pipeline system, the largest conduit for moving oil from the major storage hub in Cushing, Oklahoma to Gulf coast refineries.

News of the leak dragged U.S. crude prices lower on Monday on worries that shutting down the 850,000 barrel-per-day (bpd) Seaway system would bottle up barrels in storage in Cushing, the delivery point for the benchmark West Texas Intermediate (WTI) futures contract.

U.S. crude futures slipped 1.3 percent in afternoon trading, while international benchmark Brent crude futures fell about 1.2 percent.

Enterprise said on Monday it had shut down the 400,000-bpd pipeline, which it calls its legacy line, but did not provide an estimate of the volume spilled.

The company planned to restart the parallel 450,000 bpd Seaway Twin, which was shut as a precaution, on Monday.

Most of the oil released was contained in a retention pond at a facility belonging to Enbridge Inc, a joint owner of the Seaway Crude Pipeline Company with Enterprise.

Enterprise said there was no threat to the public and no evacuations were ordered following the spill, located near the intersection of Linwood Avenue and Texaco Road in Cushing.

The company was working with emergency responders and law enforcement to address the situation.

A spokeswoman from the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) said the organization was aware of the spill and officials were despatched to take corrective measures and relief.

The spill comes at a time of concern and debate by environmental activists and energy firms over the issues of pipeline safety and security.

Climate-change activists earlier this month disrupted the flow of millions of barrels of crude from Canada to the United States, in support of a Native American tribe protesting the construction of the controversial Dakota Access crude oil pipeline.

The Standing Rock Sioux Tribe has protested the construction of the $3.7 billion Dakota Access pipeline that will carry oil from North Dakota to the U.S. Gulf Coast, over fears of potential damage to sacred land and water supplies.

The news pushed the discount between front-month U.S. crude futures and the second-month to 69 cents, the widest in nearly two months. The prompt crude spread, often correlates to the supply-demand balance in Cushing. 


Seaway Crude Pipeline Company LLC (Seaway) is a 50/50 joint venture between Enterprise Products Partners L.P., the operator, and Enbridge Inc., which purchased its ownership interest from ConocoPhillips on November 16, 2011. The Seaway system includes a 500-mile, 30-inch diameter pipeline between Cushing, Oklahoma and the Freeport, Texas area, and a terminal and distribution crude oil network originating in Texas City, Texas that serves all of the refineries in the Greater Houston area.

On May 17, 2012 Enterprise and Enbridge completed a project to reverse the flow direction of the Seaway Pipeline, allowing it to transport crude oil from the Cushing, Oklahoma hub to the vast refinery complex along the Gulf Coast near Houston. The first volumes arrived at the Jones Creek terminal, just north of Freeport, on June 6, 2012. In reversed service the line had an initial capacity of 150,000 barrels per day (BPD). Following pump station additions and modifications, which were completed in January 2013, the capacity of the reversed Seaway Pipeline increased to approximately 400,000 BPD of crude oil.

During a binding open commitment period held January 4, 2012 to February 10, 2012, shippers executed long-term, crude oil transportation agreements that provided the support necessary to move forward with construction of a loop (twin) of the Seaway Pipeline. The new pipeline, which is designed to parallel the existing right-of-way from Cushing to the Gulf Coast, more than doubled Seaway's capacity to 850,000 BPD following completion in July, 2014.

The Seaway reversal and expansion projects, have given shippers access to Enterprise's ECHO crude oil storage facility in southeast Houston and the Port Arthur/Beaumont refining complex.

Providing southbound capacity to the Gulf Coast from the Cushing hub facilitates the development of crude oil from growing North American basins, reduces the need for imported supplies and promotes domestic energy security. Expansion of the Seaway system and its ongoing operation has generated more than 3,000 jobs. Other benefits include increased use of local goods and services and additional tax revenue for the states and communities in which the infrastructure is located.

Oil spill reported at key U.S. storage depot
Seaway crude oil pipeline reversed and doubled in capacity to facilitate shale oil boom.
By Daniel J. Graeber | Oct. 24, 2016 at 7:58 AM

CUSHING, Okla., Oct. 24 (UPI) -- Local media in Oklahoma reported Monday a company was working to contain a release of crude oil from near the main U.S. oil storage hub in Cushing.

News9, a CBS-affiliated television station in Cushing, Okla., reported a release from a pipeline controlled by the Seaway Pipeline Co. The release was reported Monday morning, though no spill volume was available.

"As emergency responders work on clean up, law enforcement says the spill is not a threat to residents and no evacuations have been ordered," the report read.

There was no statement available from Seaway. The pipeline is run by a joint venture between Enbridge and Enterprise Products Partners, which operates the 400,000 barrel per day artery.

The Seaway pipeline runs from the Cushing storage hub to the southern U.S. coast. The direction of the pipeline was reversed in 2012 in order to reduce transportation costs and accelerate development of crude oil reserves in North America. The capacity was expanded from 150,000 bpd before the reversal.

The release from the Seaway pipeline is the second associated with the Cushing storage hub in less than a month. Plains All American Pipeline reported problems with infrastructure from Colorado City to Cushing earlier this month.

Deliveries to and from Cushing could impact data on crude oil storage later in the week and skew market perceptions. An increase in storage is indicative of supply-side pressures, while a draw would support a market characterized by strong demand.