Tags: oil | isaac | hurricane | gulf

Oil Companies Recover from Isaac; One Refinery Flooded

Thursday, 30 Aug 2012 05:57 PM

Most oil and gas companies prepared to gradually restart their U.S. Gulf region installations on Thursday following Hurricane Isaac, while one refinery reported flooding and scrambled to prevent further damage.

Isaac, a much weaker tropical depression moving north Thursday evening, posed no further threat to most energy infrastructure.

Phillips 66 said its 247,000 barrel per day (bpd) refinery in Belle Chasse, Louisiana had been partially flooded. It offered no estimate on when the plant could restart, and said personnel were trying to prevent damage by pumping water out.

Isaac caused the flooding after hitting Louisiana at hurricane strength earlier this week.

Royal Dutch Shell and Anadarko were among companies that said they could begin restarting idled offshore production platforms as early as Friday.

Ninety-five percent of oil production and 73 percent of natural gas production in the Gulf of Mexico remained shut, U.S. government figures showed on Thursday. Around 936,500 barrels per day (bpd), or 5.5 percent, of total U.S. refining capacity was still idle.

Even though damage looked minimal, it will likely take several days or a week to restore around 1.3 million barrels per day (bpd) of offshore oil output and 3.2 billion cubic feet per day of natural gas production, experts said. Refineries are also expected to restart gradually to ensure safety.

"This was not a storm that bent metal, like Hurricanes Katrina or Ike," said Tim Evans, energy analyst at Citi in New York.

"I expect refineries that shut down completely to take time to come back after thorough inspections. Offshore production will be restored gradually over several days."

U.S. oil futures fell 0.9 percent to settle at $94.62 a barrel. Natural gas futures rose 2.3 percent.

The Henry Hub terminal, a Louisiana delivery point for benchmark NYMEX gas contracts, was operating normally, a spokesman from NYMEX owner CME said.

"Now it's just a case of the actual production coming back online," said Matt Smith, analyst at Summit Energy in Louisville, Kentucky.

"We'll probably see a temporary drop in crude imports due to Isaac and a drop in crude demand from refineries that have been closed."

 

 

 

IN ISAAC'S WAKE

Around 1 million Gulf Coast customers were still without as of Thursday afternoon, according to the U.S. Energy Information Administration.

Gulf Coast physical market gasoline prices moved lower, despite the flooding at Phillips 66's refinery.

Most regional refineries appeared unscathed by Isaac. Independent refiner Valero said it detected no structural damage at two Louisiana plants it operates. It was unclear when they would restart.

The Louisiana Offshore Oil Port (LOOP), a crude terminal that typically handles 13 percent of U.S. imports, could resume activities at its onshore crude storage facilities on Thursday and start up tanker loadings offshore by Saturday, according to the Department of Energy.

LOOP's facilities had a power outage linked to a downed transmission line that requires repair, but spokeswoman Barb Hesterman said LOOP's offshore facilities have diesel generators and its onshore works can operate on back-up power.

A crude distribution terminal at St. James, Louisiana was not damaged by Isaac and will restore full operations by Saturday, operator NuStar said.

St. James is also home to rail terminals that receive crude from other U.S. regions. Rail shipments should resume on Thursday after they were cut on Wednesday, said a terminal operator, U.S. Development.

© 2017 Thomson/Reuters. All rights reserved.

 
1Like our page
2Share
550
2012-57-30
Thursday, 30 Aug 2012 05:57 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved