UPDATE 4-Plains shuts Alberta oil pipeline after leak

Sat Jun 9, 2012 3:32am IST

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* Estimated 1,000-3,000 bbls of crude spills into river system

* Plains shuts down 10 km (6 miles) of pipeline system

* Plains brings in drinking water for local residents

By Jeffrey Jones

CALGARY, Alberta, June 8 (Reuters) - Plains Midstream Canada said on Friday it shut part of a pipeline in west-central Alberta after crude leaked into a large river system just as the company was close to finishing its cleanup of a big year-old spill in the province.

Plains Midstream, a unit of Houston-based Plains All American, estimated that 1,000-3,000 barrels of light, sour crude - oil that has a high sulfur content - leaked from a 12-inch line on its Rangeland south system into a tributary of the Red Deer River, a large waterway that runs cross south-central Alberta.

Streamflows are high due to recent heavy rainfall and snow melt from the Rocky Mountains to the West, which will make cleanup tricky.

The company said it has deployed booms at a reservoir that doubles as a resort area and has brought in drinking water for local residents as a precaution.

Plains shut down about 10 km (6 miles) of pipeline from the Rangeland system, an 83,000-barrel-a-day network that consists of 1,225 km (761 miles) of gathering lines that move oil from production facilities and trunk lines that carry it to market.

According to Crude Quality Inc, which tracks refining characteristics of oil, the system moves mostly conventional light crude from fields in west-central Alberta to Edmonton-area refineries or to the U.S. border, where it connects with the Glacier pipeline system.

The company said the pipeline segment was not flowing oil when the release occurred. Crude market sources said they had not seen prices react to the incident.

"Immediately upon receiving notification of the release, Plains' pipeline operations in the area were shut down and valves were closed to isolate area pipelines," Plains said in a statement.

It said it is working with regulators and investigating the cause of the leak. It dispatched crews and aircraft to the scene near Sundre, a town of 2,600 people, located 130 km (80 miles) northwest of Calgary.

"It has entered the Red Deer River and (the river) is at very high flow volume," said Bob Curran, spokesman with Alberta's Energy Resources Conservation Board. "They've got crews out with booms. I don't know the exact numbers but I do know that they've responded with people on the ground."

Despite the sour crude's strong odor, there is no health danger to the public, Plains said.

Alberta Premier Alison Redford, who was on her way to the site on Friday, sought to assure residents that all necessary resources would be deployed to limit the environmental impact and protect health and safety.

Despite recent spills, Redford said Alberta has an "internationally recognized pipeline system supported by a strong regulatory framework."

"This incident will be investigated and the ministers of Energy and Environment and Sustainable Resource Development will review the findings and take further action if required," she said in a statement.

Last year, much of Plains' 187,000-barrel-a-day Rainbow oil pipeline in northern Alberta was shut down for four months after a rupture spilled 28,000 barrels of crude near a native community in late April. It was one of the largest spills in Alberta in decades.

The company said this month it was putting the final touches on reclamation efforts.

Pipeline spills come at a crucial time for the energy industry, with operations under the microscope as companies try to advance plans for major trunk lines from Alberta, such as the Keystone XL pipeline to Texas and Northern Gateway pipeline to Canada's Pacific Coast.

Opponents of those projects pounce on any indication that crude oil transport comes with risks of environmental damage.

"How many times does this have to happen before governments stop accepting the company's assurances that they are taking environmental protection seriously?," Greenpeace climate and energy campaigner Mike Hudema said in a statement "We need a full public review of pipeline safety especially before new pipelines carrying even more corrosive substances are approved."

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