Exxon prepares to replace ruptured pipeline

13 Jul 2011 14:52

Source: reuters // Reuters

* Preliminary works starts on pipe that leaked into river

* Company says to meet federal corrective requirements

* Four animals treated for oil exposure so far

* Clean-up effort expanding (Adds details of clean-up, byline)

By Anna Driver

HOUSTON, July 13 (Reuters) - Exxon Mobil said it had begun preliminary work to replace the pipeline that ruptured and spilled an estimated 1,000 barrels of oil into the Yellowstone River in Montana two weeks ago.

Exxon, the world's largest publicly traded oil company, said it was aiming to meet federal requirements on corrective action around the Silvertip pipeline before resuming operations.

Preliminary work includes talks on permitting requirements, rights of ways, drilling equipment, contracting and pipeline fabrication and transportation, the Irving, Texas, company said on Wednesday.

Federal officials say shoreline contamination from the July 1 rupture that spilled crude into one of America's most pristine rivers, has been observed over an area stretching at least 240 miles (386 km) downstream from the site of the burst pipeline.

Montana Governor Brian Schweitzer has criticized Exxon and accused the company of underestimating the amount of oil released into the river. Exxon's initial estimate of the spilled amount remains unchanged.

High water in the Yellowstone has hindered government and Exxon efforts to determine the cause of the failure of the 12-inch pipeline, which is buried in the riverbed.

The scope of the oil company's clean-up effort is expanding. Nearly 700 people have been dispatched to help, up from 600 earlier this week. Workers are using boom to contain the oil and absorbent pads to mop up crude along the river's banks.

So far, 942 barrels of oily liquids have been recovered, according to data from the U.S. Environmental Protection Agency.

Exxon, which has so far declined to put a price tag on its spill clean-up, is responding to more than 120 claims from residents who have reported damage to property, crops or their health, it said.

The spill has also forced Exxon to cut back production at its 60,000 barrel-per-day Billings, Montana, refinery.

The company expects to meet its motor fuels contract commitments and is exploring options for alternative supplies of crude, spokeswoman Rachael Moore said in a statement.

Exxon said that so far it has treated four animals for exposure to oil: a garter snake and a western toad, which have been released, and a Woodhouse's toad and a warbler.

Several oiled birds have been observed, and the company was deciding whether they required capture and cleaning. (Additional reporting by Kristen Hays in Houston and Matt Daily in New York; editing by John Wallace and Maureen Bavdek)