A recent article in Bloomberg described a disaster that occurred in 1976 in West Texas when an underground oil pipeline exploded, burning to death five people. Unbeknownst to Cristobal Sustaita an eight-inch pipe ran underground near to his house carrying liquefied petroleum gas. The pipe cracked along a faulty welded seam leaking the gases vapors. A cloud of LPG fumes built in the area, eventually igniting in a giant fire ball that rose 200 feet into the air, and covered an area nearly a mile long and a quarter-mile wide. The fire engulfed his house whilst he was out visiting his parents, killing his wife and 18 month old son.
It was the first time that attention had been brought to the faulty welds that had been made on most pipelines laid in the U.S. before 1970. Ever since that time more and more leaks have been reported from these pipes, caused by the faulty welds; rupturing, exploding, and killing people, despite the constant warnings released by federal investigators and private consultants. Currently nearly a quarter of all pipelines in the U.S. (50,100 miles) were laid before 1970 and suffer from these faulty welds, carrying their explosive cargo all over the country, and offering a very serious public safety threat.
The reason that they haven’t been fixed? Industry officials estimate that to replace them all would cost in the region of $50 billion.
The U.S. Transport Department, through the Pipeline Safety and Hazardous Materials Administration, has the power to force pipeline operators to replace the dangerous sections of pipe, but must weigh the cost of such an action, against the fact that the number of accidents caused by the faulty welds is only a small percentage of all pipeline accidents.
Carl Weimer, the executive director of the Pipeline Safety Trust, explained to Bloomberg that “there isn’t a silver bullet. It’s going to be a hard fix and with 50,000 miles of it in the ground, it’s going to be an expensive fix.”
The latest major accident caused by the faulty welds was the Exxon Mobil (NYSE:XOM) spill in Arkansas that covered a neighborhood in oil in March this year. This may be enough to finally force industry regulators in Washington to make a decision on how to prevent similar incidents occurring in the future. Whether it be with new, more extensive tests on the structural integrity of the pipelines, or forcing companies to dig up and replace their pipelines.
Originally written for OilPrice.com, a website that focuses on news and analysis on topics of alternative energy, geopolitics, and oil and gas. OilPrice.com is written for an educated audience that includes investors, fund managers, resource bankers, traders, and energy market professionals around the world.