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Hurricane Katrina oil, gas damage worse than thought Slow production recovery points to widespread facility, pipeline damage in U.S. Gulf By Ray Tyson Petroleum News Contributing Writer
Hurricane Katrina, which swept through the Gulf of Mexico with a vengeance nearly three weeks ago, evidently caused more damage to oil and gas infrastructure than earlier portrayed by federal regulators.
Gulf production halted ahead of the massive storm has been unusually slow to recover, with 56.14 percent of oil and 34.11 percent of natural gas remaining shut-in as of Sept. 15, according to the U.S. Minerals Management Service, the federal agency which regulates operations in the Gulf.
Moreover, the actual percentage of Gulf oil production restored over the previous week had barely moved, hovering between 56 and 58 percent of total production shut-in as a result of the storm.
Rebecca Watson, assistant secretary for Land and Minerals Management, told the U.S. Senate Energy and Natural Resources Committee just days after the storm that while Katrina caused damage to “many” offshore facilities, production likely would be restored “in days and weeks, rather than months.”
However, damage reports filtering in from some of the Gulf’s largest producers indicate that recovery could take longer than the federal government initially believed. Shell: Only 60% back up in 4th quarter Shell Oil, reporting damage to four offshore platforms, is currently producing about 160,000 barrels of oil equivalent per day, well short of its usual 450,000 barrels per day. Shell is the largest operator in the Gulf and alone accounted for a hefty 30 percent of the Gulf’s entire 1.5 million barrels of daily oil output prior to the hurricane.
“Shell expects that about 60 percent of total production will be restored to pre-hurricane levels within the fourth quarter 2005,” the company said, without saying when Shell expected to have all of its production back online.
Damage to one of Shell’s crude pipelines near Nairn, La., also caused a spill, Shell said, adding that containment and cleanup were under way. A second spill at a tank farm in Pilottown, La., also was being contained, the company said. On the bright side, other onshore pipelines sustained little damage, Shell said.
Shell’s Motiva refineries at Convent and Norco, La., accounting for 27 percent of Shell’s U.S. refining capacity also were affected by the storm. The Convent refinery is back to normal production, while the Norco refinery began production Sept. 12 and was nearly fully operational, the company said. BP: considering options to move oil Other large Gulf producers are said to be ready to pump but can’t get their production ashore because of damage to key pipelines and onshore storage facilities. A spokeswoman for BP told Dow Jones that the big producer was considering options, including barging, tankering and bypassing third-party operated pipelines to get BP’s production to market. But it was unknown just how much of BP’s production was shut-in.
MMS said 842,091 barrels of total Gulf daily oil production remained shut-in as of Sept. 15, as well as 3.411 billion cubic feet of natural gas. The cumulative shut-in oil production from Aug. 26 to Sept. 15 totaled 21.38 million barrels of oil, while the cumulative shut-in gas production during the same period totaled 102.41 billion cubic feet.
However, only 84 or 10.26 percent of the 819 manned platforms in the Gulf remained evacuated Sept. 15, while just a handful of the 134 drilling rigs remained evacuated. Overall, Katrina destroyed at least four drilling rigs and 37 offshore platforms.
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