Ineos: Forties pipeline back in service by early January

Dec. 21 (UPI) -- Flow through the Forties pipeline system from the North Sea, idled since Dec. 11, should be back to normal in early January, the operator said Thursday.

Pipeline operator Ineos said it started the planning phase for the eventual resumption of operations on a system that sends about 40 percent of the oil produced in the British waters of the North Sea to inland refineries.

A hairline crack was discovered in the pipeline near Aberdeen and the company closed the system down Dec. 11. The crack is stabilized, custom components needed for a fix are en route and the network should be back up and running in about a week.

"Work on the pipeline is progressing well and based on current estimates INEOS is planning to complete the repair around Christmas," the company said in a statement. "Based on current estimates the company expects to bring the pipeline progressively back to normal rates early in the New Year."

That's a bit ahead of schedule, as earlier estimates said it could take as long as four weeks from Dec. 11 for recommissioning. Ineos said that, initially, its customers would get oil and gas from the system at low rates, but flow would gradually ramp up to the first week in January.

Ineos confirmed a formal declaration of force majeure last week on contracts for the system after a number of fields closed as a result of the disruption. Force majeure is a contractual condition related to circumstances beyond the control of the parties involved.

The Forties system carries Brent, Forties, Oseberg and Ekofisk oils, which account for a basket that make up the global benchmark

The closure of the system in mid-December triggered a 2 percent spike in the price for Brent crude oil, though it's moderated as the work from Ineos progressed. The price for Brent was down about a half percent early Thursday to $64.30 per barrel.

Ineos paid BP around $250 million to acquire the 235-mile Forties pipeline system earlier this year.