03/01/2012 07:38 pm ET Updated May 02, 2012

BP Exploration Alaska Fire Hits Gathering Center 2

By Yereth Rosen

ANCHORAGE, Alaska, March 1 (Reuters) - BP shut a 77,000 barrel per day (bpd) oil gathering center at a key Prudhoe Bay oil field due to a fire on Wednesday, but has begun restoring output, the company and state officials said on Thursday.

BP Exploration Alaska Inc had a "small fire" at Gathering Center 2 (GC-2), a facility that separates oil from natural gas and water, said Cathy Foerster, a member of the Alaska Oil and Gas Conservation Commission.

BP confirmed the fire, saying employees at the facility saw a flame and heard a noise at one of two low-pressure gas-handling buildings at about 10.30 a.m. local time on Wednesday.

BP spokesman Steve Rinehart said in an email that no one was in the building at the time and there were no injuries. He added that there was no spillage of oil and the fire extinguished itself. There is little or no damage, BP said, but a full inspection is underway.

As a precaution, BP said it shut the plant down and isolated the affected building. Rinehart said the plant is being brought back online Wednesday but the production impact is undetermined.

Normal flow through the gathering center -- one of about a dozen plants across the North Slope that process oil for shipment down the Trans Alaska Pipeline -- is 77,000 bpd. The shutdown appears to have caused the state's output to decline by 55,000 bpd to 564,699 bpd on Wednesday, Foerster said.

Kyle Smith, a policy and legislative adviser at the Alaska Division of Oil and Gas said production is not yet back to normal.

"They're bringing the equipment and the plant and the wells back on slowly," he said.

Michelle Egan, spokewoman for Alyeska Pipeline Service Co, which operates the Trans Alaska Pipeline, said throughput seemed to be returning to normal. Alyeska did note the decline yesterday, she said, adding that "it seems to be correcting itself today."

Smith said BP has told state officials it hopes to be back up to normal levels at GC-2 by Friday or Saturday.