The Forties pipeline had to be shut down for the second time in two months on Wednesday, leaving buyers worried about the infrastructure behind Britain's oldest and most important oil route, according to a new report by Reuters.
Operator Ineos said the facility should begin transporting fuels at its normal rate of 450,000 barrels per day overnight. The company acquired the Forties network from British Petroleum two months ago for $125 million.
Last December, a crack caused Forties to shut down for three weeks, prompting Ineos to call a force majeure on its export contracts. Oil prices shot up after the announcement. The January crude loading program was changed with 13 cargoes deferred from December to January as a result, and another 12 cargoes were deferred from January to February.
This time around, a set of values supplying the Kinneil plant closed without warning, cutting off some of the pipeline's usual customers.
"When these valves close, then this requires FPS (Forties Pipeline System) to shut down the pipeline system and its customers in the North Sea," it said.
Royal Dutch Shell and Total had to stop production and exports at two fields due to the shutdown this week.
Related: The World's Biggest Oil Benchmark Could Change Forever
Forties pipeline is a key transit route for North Sea oil and the Forties crude blend is the largest component of the Brent-Forties-Oseberg-Ekofisk-Troll (BFOE) complex, which is the basis for the Brent futures contract. The Forties pipeline carries some 40-45 percent of the UK's liquids production and more than 80 fields feed into the pipeline.
The UK's energy industry body Oil and Gas UK has estimated that the shutdown had cost $26.85 million in lost production daily. The ordeal was thought to remove between 5.5 million and 13 million barrels of oil from the market by the time the pipeline was restarted, according to Bloomberg.
By Zainab Calcuttawala for Oilprice.com
More Top Reads From Oilprice.com:
Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on… More
U.S. Power and NatGas Prices Plummet to Below Zero
Ukrainian Drones Hit Major Rosneft Refinery in Russia
First Niger Oil Bound for China Blocked in West Africa Border Row
Gas Prices Likely to Keep Falling Ahead of Peak Driving Season
Drone Attacks Take Khor Mor Gas Field Offline, Claims Lives