Terminal Operations

Two years later: Has safety at Alyeska improved?

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Alyeska’s response yields many improvements although concerns remain

Screenshot of cover of report
View 2023 report (PDF 4.1MB): “Assessment of Risks and Safety Culture at Alyeska’s Valdez Marine Terminal”

A 2023 Council report identified some serious safety risks at Alyeska’s Valdez Marine Terminal. Since that time, the Council has been monitoring the actions taken by Alyeska to improve the work culture and more effectively promote an atmosphere of safety. Many areas have improved over the last two years. Some improvements are still in process and some areas of concern remain.

The 2023 report raised concerns about whether the terminal was operating safely and in compliance with regulations. The report was authored by Billie Pirner Garde, a national expert on safety culture for work environments in energy industries. In the report, Garde made a series of recommendations aimed at improving the situation.

Alyeska’s efforts to improve

When the report was first released, the Council was encouraged by its reception. Alyeska President John Kurz spoke to the Council and said that he and Alyeska’s executive team were taking the report seriously.

Alyeska formed an internal team to follow up and develop a plan to address the issues.

“Alyeska has engaged in a substantial amount of work to address the recommendations directed towards them,” says Donna Schantz, executive director for the Council.
Auditors reviewed worker safety and processes at the Valdez Marine Terminal

Alyeska conducted internal reviews and contracted with a third party to audit various factors that affect safety at the terminal.

Auditors compared the current safety system with federal requirements for “process safety management.” OSHA developed this set of standards to help industries safely manage the hazards of working with highly hazardous chemicals. This guidance helps recognize, evaluate, and control risks that could occur while working with hazardous materials.

The auditors identified some areas of improvement in Alyeska’s systems. Alyeska reported that corrective actions have been taken, and there are currently no outstanding audit findings. They also worked on better aligning their documentation regarding process safety management, including the creation of a compliance manual, and conducted additional training.

Alyeska also reviewed their deferred maintenance backlog. Among other issues, Alyeska improved how they evaluate risks associated with work orders. This ensures that higher-risk orders are identified appropriately. Alyeska has prioritized existing work orders and is monitoring any past due and upcoming commitments.

A few issues still remain. A review of human factors was conducted, and a program to help address and mitigate human-related accidents is still being developed. Alyeska also continues to review and assess recommended practices for establishing safety systems.

Alyeska working to encourage culture of safety

Garde’s report recommended mandatory training for supervisors to encourage a stronger safety culture. Alyeska has completed that training.

Alyeska also reported that they continue to develop and improve their employee concerns program. The success of that effort is yet to be determined.

Updated recommendations

Garde recently developed some additional recommendations. Among those, she recommended the Council develop a set of performance indicators that would serve as an objective measure for comparison when talking to Alyeska about concerns.

Remaining concerns

Though many of the safety issues have been addressed, the Council still has concerns: Alyeska has lost key staff with extensive institutional knowledge in recent months; gaps in regulatory oversight and monitoring remain unaddressed; and the Council and contractor Billie Garde continue to receive reports from employees concerned about safety issues.

GAO report looks at Joint Pipeline Office

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Image is screenshot of GAO report.
The GAO’s report is available on their website: Trans-Alaska Pipeline: Clarifying the Roles of Joint Pipeline Office Agencies Would Enhance Safety Oversight.

A new report from the Government Accountability Office, or GAO, examines the current status of the Joint Pipeline Office, or JPO.

The JPO is a group of six federal and six state agencies that oversee various parts of the Trans Alaska Pipeline System. The office was formed after the Exxon Valdez oil spill by the Bureau of Land Management and the Alaska Department of Natural Resources to coordinate oversight between the 12 agencies. The last time the GAO reviewed the JPO was in 1995.

In 2023, Senators Lisa Murkowski and Dan Sullivan asked the GAO to conduct the assessment. They specifically asked the GAO to examine the current structure of the organization; how the organization has changed over time; whether the group effectively collaborates to ensure the safety of the pipeline and terminal; and whether the organization has sufficient personnel, resources, and authority to complete its mission.

The Senators’ request came about after a Council-sponsored report found that, among other issues, there had been a reduction in oversight of the terminal in recent years.

“We’ve just begun reviewing the GAO’s report and its recommendations,” says Donna Schantz, executive director for the Council. “We are extremely appreciative of the efforts of Senators Murkowski and Sullivan for requesting this report.”

The JPO: Then and now

“Since its formation in 1990 in response to the Exxon Valdez oil spill, JPO has played a critical role in overseeing the 800-mile pipeline and marine terminal that comprise the Trans-Alaska Pipeline System,” the GAO’s report says.

Until 2004, the JPO’s oversight activities “focused on producing Comprehensive Monitoring Program Reports, reviewing pipeline projects, preventing and responding to oil spills, preparing for the renewal of the TAPS right-of-way agreement, and responding to Alyeska employee concerns,” according to the GAO’s report. The group previously shared an office and published reports on its activities, which it no longer does.

The report says that, according to stakeholders, JPO “scaled back” its work due to a decrease in TAPS projects that required oversight. The report also notes that JPO’s oversight of TAPS was also impacted by shifts in agency roles.

JPO’s current role is unclear

The GAO report notes that the JPO currently functions “as a forum through which participating agencies share information and coordinate activities.”

The GAO recommends the JPO would benefit from outlining the intended outcomes of its current activities “including those aiming to inform the public of its oversight efforts.” This would “enable JPO agencies to work toward shared goals and ensure accountability.”

“Clarifying roles and responsibilities would enhance coordination among JPO agencies and help JPO identify any potential gaps in oversight,” according to the GAO.

The need to identify gaps in regulatory oversight was a significant finding in the Council’s 2023 report (see also “Two years later: Has safety at the terminal improved?”).

“We are encouraged to see the GAO recommend that the JPO needs to clarify its roles and responsibilities,” Schantz said. “The Council had also hoped that the GAO would identify potential gaps in regulatory oversight. Instead, while mentioning that potential gaps are a concern, they have recommended the JPO do this review for gaps themselves.”

In its 1995 review, the GAO noted that the JPO’s success depends on having adequate staffing and funds over the long term. Government agencies have been experiencing reductions in staffing, budgets, and resources for years, with losses increasing at some federal agencies in recent months. The Council is concerned about the JPO’s current capacity to monitor the complex systems at the terminal, along with their ability to follow through on the GAO’s recommendations.

“Everyone involved wants to make sure that oil is transported safely in Alaska,” Schantz said. “Comprehensive regulatory oversight is of critical importance to help ensure that adequate safety systems are in place to prevent devastating events from occurring. This also supports industry and their desire to increase energy development by providing consistency and timely guidance.

Contingency plan for terminal under review

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The oil spill contingency plan for the Valdez Marine Terminal is undergoing its five year renewal. During a public comment period in December, the Council voiced concern over a “prevention credit” that reduces the amount of oil that the industry must be ready to clean up if a spill were to occur.

One of the Council’s primary duties is reviewing spill contingency plans for the oil industry in Prince William Sound. The Council has been reviewing these plans since 1990.

“Over 30 volunteers, staff, and contractors spent hours reviewing documents and coordinating these comments,” noted Linda Swiss, the Council’s project manager for contingency planning. The three volumes that make up the oil spill contingency plan for the Valdez Marine Terminal contain over 1,000 pages in total.

What’s in a contingency plan?

Oil spill contingency plans contain details about the steps to be taken before, during, and after an oil spill.

  • Before: what’s being done to prevent an oil spill
  • During: how the industry will respond to an oil spill, including where the equipment and personnel would come from
  • After: plans are updated to reflect lessons learned from previous spills

“These plans are a good way for stakeholders to understand how their resources and livelihoods are protected,” Swiss says.

Oil spill contingency plans are prepared by the operators of Alyeska’s marine terminal and oil tankers and are subject to state approval.
There are separate plans for spills from the Valdez Marine Terminal and from the tankers that load crude oil at the terminal. Plans undergo an update, review, and approval process approximately every five years.

Liners under crude oil storage tanks still of concern

This image shows the giant crude oil storage tanks at the Valdez Marine Terminal. The walls of the massive asphalt-lined cells can be seen surrounding the tanks in this photo.
The crude oil storage tanks at the Valdez Marine Terminal are surrounded by massive asphalt-lined cells that are designed to contain oil in case of a spill from a tank. The cell walls can be seen in this photo. Photo by Linda Robinson.

One of the central issues the Council is concerned about is an asphalt liner surrounding the large oil storage tanks.

Each tank holds approximately 23 million gallons of oil. If a tank were to leak oil, the liners act as a backup system that is supposed to contain the oil until it can be cleaned up and before it can contaminate ground water or Port Valdez. The backup or “secondary containment” system consists of a huge bowl-shaped area around the tank. The area is lined with asphalt, which is buried under several feet of gravel.

Why does the Council care about this liner?

The Exxon Valdez oil spill taught the lesson that a certain amount of equipment and trained personnel must be on hand to respond quickly.

The amount of response equipment and personnel varies according to the storage capacity. At the terminal, this is based on the maximum amount one of the oil storage tanks can hold, which is approximately 23 million gallons.

Alyeska receives a 60% “prevention credit” for various prevention measures. Most of that 60% is for having the asphalt liner around the tanks. This means they plan for a spill of 40% of the total volume of one tank, which is 8.5 million gallons. If more than 8.5 million gallons is spilled, they would still be responsible for cleaning it up, however, more equipment would be needed than is currently listed in the plan.

Is the liner still intact?

This liner was installed when the terminal was built and is approaching 50 years old. From time to time, sections of the gravel layer over the liner have been removed when work is done for other projects. When this is done, cracks and holes are often found in the liner.

“There are crude oil storage tanks holding half a million barrels of oil sitting on a steep slope above Port Valdez within a secondary containment system with known integrity issues,” the Council noted in their comments.

Testing the liner

Because the liner is buried under gravel, it is expensive and time-consuming to dig it up for a visual examination. Excavation could also damage the liner. In 2022, the Council conducted a study of methods to evaluate the liner without removing the gravel. Alyeska is planning to conduct a pilot test this summer using an approach similar to the method recommended in that report.

What is a prevention credit? Spilled oil can never be completely recovered, so regulations are designed to encourage companies to prevent spills from happening in the first place. One way to do this is to give “credit” for prioritizing spill prevention.
In Alaska, the amount of equipment and personnel that an oil company must keep on hand to respond to a spill depends on the potential size of a spill. If a company takes actions to prevent or reduce the risks of a spill, they can qualify for such a credit. This allows the company to keep less equipment and personnel on hand to respond, because a spill is less likely.

Additional issues

The Council noted several issues aside from the liner, including:

  • The length of time between internal inspections of the storage tanks.
  • A lack of detail about the training to prevent oil spills.
  • Documents containing plan information that were not made available as part of the public review.

More information

The Council’s comments: PWSRCAC comments on 2024 VMT Contingency Plan Renewal

Annual Report now available

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Front cover of the report. Image is of a rocky beach in Prince William Sound covered with mussels and other tidal critters. Mountains and ocean in the background. Clicking on the image will download a PDF of the report.The Council’s annual report, Year in Review 2022/2023, is now available. This report covers the many programs and projects we’ve been working on over the past year, such as oil spill prevention and response, environmental monitoring, oil spill contingency plans, operations at the Valdez Marine Terminal, invasive species monitoring, our outreach efforts, and much more. Highlights from this year include:

  • An assessment of risks and safety culture at the Valdez Marine Terminal
  • Ensuring the adequacy of secondary containment liners for the terminal’s crude oil storage tanks
  • Supporting solutions for sustainable funding for state spill
    prevention and response
  • Improvements to how the Council monitors weather and sea currents in our region
  • Monitoring oil spill drills and exercises
  • Reexamining the Council’s position on use of dispersants in our region

Download: 2022-2023 Annual Report

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