UPDATE 3-UK's CATS gas pipe reopens after repairs

Thu Aug 30, 2007 4:24pm BST

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(Adds comment from Chevron from paragraph 11)

By Daniel Fineren

LONDON Aug 30 (Reuters) - The CATS gas pipeline, which supplies up to a fifth of Britain's gas, is to reopen this week after a two-month repair shutdown, allowing a cluster of North Sea oil and gas fields to resume output earlier than expected.

Pipeline operator BP (BP.L) said on Thursday it had begun filling the Central Area Transmission System (CATS) after repairing it ahead of schedule and that it would reopen the pipeline to commercial flows at the end of the week.

Normal flows are expected around the middle of September, it said.

The pipeline, which carries gas from a number of North Sea oil and gas fields, was shut on July 1 for repairs after a large vessel scratched off its protective casing with its anchor in June. Until now, BP had said that the repairs could run into September.

ConocoPhillips (COP.N), the operator of the J-Block oil and gas fields connected to CATS, said it expected to restart exports from Friday.

The repairs have prevented J-Block -- which produced over 35,644 barrels of oil and 12 million cubic metres of gas a day in April -- from exporting either fuel because it cannot pump oil while there is nowhere for the associated gas to go.

"J-Block is ready to start production and anticipates recommencing exporting through CATS on Friday Aug. 31," a Conoco spokeswoman said. "That was good news coming through that it was completed ahead of schedule."

Conoco said oil flows should also be able to restart through the Norpipe pipeline to northeast England from Friday.

A spokeswoman for BG Group (BG.L), which operates the Armada oil and gas field connected to the same system, said it expected to return to full production by mid-September.

Armada - which produced around 10,770 bpd of oil in March and a total of 42.30 billion cubic feet of gas last year, had the same problem as J-Block, industry sources said last month.

Chevron (CVX.N), which last month admitted the repair was affecting production from its 11,000 bpd Erskine oil field but would not say how badly, said it hoped to restart the field within a week.

"Chevron expects to restart production from its Erskine field around Sept 5, depending on the progress of the CATS staged re-entry plan," a spokeswoman for the company said.

Erskine also produced about 1.8 million cubic metres a day of gas in March, according to government figures.

BP also operates fields connected to the CATS pipeline but a spokesman would not comment on the production impact.

CATS PATCHED UP

BP said in a statement on Thursday that divers had installed a metal sleeve to strengthen and protect the pipeline where it was scratched by the anchor in stormy seas at the end of June.

When the anchor hit, CATS had been flowing at a reduced rate because of planned offshore field maintenance. But several of those fields, including J-Block, would have been sending gas to the UK over the last two months had the path not been blocked.

The 408-km pipeline links a riser platform, adjacent to the North Everest development in the Central North Sea, with the gas processing terminal at Teesside.

The pipeline can transport over 48 million cubic metres a day of gas, around 20 percent of the UK's peak demand.

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