Harris threatens to hold hearings for oil shippers

Posted: Thursday, March 20, 2008

ANCHORAGE - House Speaker John Harris is concerned that the owners of the shipping company that hauls North Slope oil for BP are skimping on tanker maintenance.

The Republican from Valdez is threatening to hold hearings on the issue and recently fired off letters to top executives of three firms that jointly own Alaska Tanker Co., an Oregon-based operator.

Harris told The Anchorage Daily News that he wrote the letters after the operator's president, Anil Mathur, came to him and said he was having difficulty with the company owners.

Harris said in the letter that he understood Mathur had been put on notice for poor behavior after a funding request for tanker work was denied.

The toughest of the letters went to Donald Kurz, president of Philadelphia-based Keystone Shipping Co., one of ATC's owners. Kurz is chairman of ATC's board of directors.

In the letter, Harris say, "Should there be a failure of the ... tankers because Anil has not been given the resources and support necessary to maintain operations integrity, I will recommend to my colleagues that you present yourself in front of the Alaska Legislature."

The ships are used to carry oil from the trans-Alaska oil pipeline tanker dock in Valdez to refineries on the West Coast.

Since 2004, BP has upgraded its fleet with four new double-hull ships at a cost of $250 million each. Congress mandated oil companies replace their single-hull oil tankers with double hulls after the Exxon Valdez oil spill in Prince William Sound in 1989.

BP's new tankers have been plagued with problems since they were launched into service. Problems include cracked rudders, anchors that have fallen off during rough crossings of the North Pacific, a mooring post snapping off the deck of one ship while docking, and two cases in which engine power or control was lost.

BP owns 25 percent of ATC, the company that runs the tankers. The other owners, at 37.5 percent apiece, are Keystone Shipping and New York-based Overseas Shipholding Group Inc.

Mathur declined comment Tuesday on his relations with his bosses or the letters Harris wrote. He did, however, tout his company's safety and environmental record, saying, "We have operated over five years without a crude oil spill at sea."

In a reply to Harris last week, Kurz said, "One of the processes which we have successfully employed in achieving our favorable results is that of 'corrective action.' The internal situation to which your letter refers regarding Mr. Mathur is not one of budgeting or operations integrity, but one of personal behavior and comportment."

Steve Rinehart, BP's spokesman in Anchorage, deferred to a response the company's U.S. president, Bob Malone, sent Harris.

Malone's letter says Mathur "has played a significant role" in ATC's "impressive" performance.

Malone added he believes BP and the other ATC owners "have supported both the management and financial obligations" of safely running the tankers.

Harris said he doesn't plan to hold hearings now but will if he hears more negative reports about ATC.

"I'm confident they got the message and they'll do the right thing and put the money in that's needed," Harris said.

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