Exxon says Mobile Bay leak caused by salt water line

Reuters News
Posted: Sep 22, 2011 4:08 PM
Exxon says Mobile Bay leak caused by salt water line

NEW YORK (Reuters) - A salt water pipeline leak offshore Alabama has forced ExxonMobil to halt gas production in the Mobile Bay area of the Gulf of Mexico, the company said on Thursday.

A sheen was detected on the water on Tuesday night, one mile south of Dauphin Island where ExxonMobil runs a number of subsea natural gas pipelines, prompting the company to shut in 280 million cubic feet per day of natural gas production.

"ExxonMobil can confirm that a subsea pipeline that transports salt water produced from its offshore natural gas wells in the area to its onshore gas treating facility has a leak," a spokesman said.

The leaking substance is made up of silt, sand and salt water, with traces of hydrocarbons, he said.

Exxon is developing plans to repair the pipe and natural gas production will remain shut until it is fixed. There is no timeline for resumption of supply.

U.S. natural gas prices were unmoved by the news, ending trading more than 2 cents lower at $3.71 per million British thermal units on Thursday. Ample supply has pushed U.S. natural gas to 11 month lows and traders said the shut-in was unlikely to affect prices.

(Reporting by Edward McAllister;editing by Sofina Mirza-Reid)