(Update 5:15 p.m.)
The official word from the Department of Energy on the Citgo request:
On Tuesday, September 2, 2008, the U.S. Department of Energy received a formal request from Citgo’s Lake Charles, Louisiana refinery for 250,000 barrels of oil from the Strategic Petroleum Reserve. The oil is needed because of the closure of Louisiana’s Calcasieu channel and disruptions in oil supply caused by Hurricane Gustav. The Department intends to grant Citgo’s request
(Update 5:15 p.m.)
In a conference call this afternoon Shell officials said while doing their flyover in the Gulf today they noticed at least one oil spill on the water but declined to say where it was since it did not involve their equipment. They reported it to the U.S. Coast Guard.
The National Response Center, which serves as a sort of one-stop-call for any hazardous material spill, had two incidents listed as possibly storm-related releases: an ethylene glycol spill from a storage tank into a holding pond at a Dow Chemical plant in Iberville, La. and a white cloud of an unknown substance from a storage tank near Michoud, La.
(Update 3:25 p.m.)
Sept. 2 (Bloomberg) — Citgo Petroleum Corp. has asked the U.S. Energy Department to release 250,000 barrels of oil from the Strategic Petroleum Reserve, a government spokeswoman said.
“The request is currently being reviewed,” Energy Department spokeswoman Alyson Austin said in an e-mail today.
Noble Corp., the third-largest U.S. offshore oil driller, said none of its Gulf of Mexico rigs sustained major damage from Hurricane Gustav, according to Bloomberg.
(Update 3:00 p.m.)
Shell and Motiva (the refining joint venture with SaudiAramco) just put out an update of a midday assessment of their refineries:
• Motiva Norco Refinery:The site maintains some power and initial assessments indicate minimal damage. Depending on resources, a restart for some units could begin over the next couple of days.
• Motiva Convent Refinery: The site does not have power and assessments continue. Initial reports indicate that some power lines are down. Back-up generators enroute.
• Motiva Port Arthur Refinery:The refinery continues to run at reduced rates and supplying products to customers. There were no physical impacts to facilities from the storm.
• Shell Deer Park Refinery and Chemical:The site continues to operate and supply products to customers.
• Shell Chemical Norco Facility: The site maintains some power and initial assessments indicate minimal damage.
• Shell Chemical Geismar Facility: The site does not have power and assessments continue. Initial reports indicate that some power lines are down. Additional back-up generators enroute.
Shell/Motiva is reporting its fuel distribution facilities around New Orleans are operating:
“The Kenner Terminal [about 12 miles from NO] did not sustain damage and has reopened under generator power as of 9 am this morning. A safety review of our Convent Terminal [30 miles southeast of Baton Rouge] completed this morning indicates that some minor damage was incurred, and we will reopen the Convent terminal as soon as possible. All other Motiva terminals in the Gulf Coast are open and refueling tank trucks.”
(Update 1:35 p.m.)
Independent E&P company Anadarko says it’s preliminary flyover of Gulf facilities looks good:
Anadarko’s offshore assets.
Anadarko completed a fly-over visual inspection from a fixed-wing aircraft of our Independence Hub, Marco Polo, Constitution and Neptune platforms in the eastern and central Gulf of Mexico. All were in or near the path of Hurricane Gustav, and all appeared intact, with no visual damage. We expect to begin returning personnel to these facilities today for a more thorough inspection.
We also expect to begin returning personnel to our other operated facilities in the central and western Gulf of Mexico today. These facilities include Nansen, Boomvang, Gunnison and Red Hawk.
(Update 1:15 p.m.)
Calif.-based risk modeling firm EQECAT Inc., has lowered its estimated Hurricane Gustav-related onshore insured losses to a range of $3 billion to $7 billion, most of it in Louisiana. That’s down from Monday’s estimate of $6 billion to $10 billion in losses.
The company is not changing its estimate of damage and disruption related to production of crude oil and natural gas offshore in the U.S. Gulf of Mexico, however.
“We are reviewing additional information from energy companies and other sources, but continue to anticipate shut-in production for the next year will not exceed about 5 percent of the production capacity for crude oil, and 5 percent of production capacity for natural gas,” said Tom Larsen, senior vice president. “The offshore estimates exclude any potential damage to onshore refineries, which we also will assess in coming days as information becomes available,” he said.
(Update 12:20 p.m.)
Houston-based Targa Resources, the operator of several key natural gas processing plants on the Gulf coast, said its Lowry, Barracuda and Stingray plants have not suffered any meaningful damage and that they should be ready to process gas as soon as producers start up their platforms again.
Targa President Joe Bob Perkins said workers are lined up at road blocks outside St. Bernard and Plaquemines Parishes, ready to inspect the company’s plants in Venice and Yscloskey later today. These plants were swamped by Hurricane Katrina and were down for many many weeks (back then Dynegy owned them).
“We believe both took on water, but how much water and how dirty it is will determine how long it takes to get them back up,” Perkins told the Chronicle today.
(Update 11:30 a.m.)
The Department of Energy put out a great summary of a lot of energy related information this morning. Some of the info is more than 24-hours old but it’s still interesting. A few highlights:
• As of 12:30 PM EDT, September 1, 2008, the Minerals Management Service (MMS) reports 7,062 million cubic feet per day of the Gulf’s natural gas production have been shut-in, equivalent to 95.4 percent of the Gulf production. MMS reports 1,300,000 barrels/day of the Gulf’s crude production has been shut-in, equivalent to 100 percent of the Gulf’s crude production. A total of 626 production platforms, or 87.3 percent of the Gulf’s 717 manned platforms, have been evacuated. Personnel from 100 rigs, representing 82.6 percent of those operating in the region, had been removed
• As of 7:00 PM EDT September 1, 2008, fourteen refiners were shutdown, totaling 2.7 million barrels per day of capacity. Nine refineries in the Gulf Coast region also reduced runs.
• On the Colonial pipeline, two central Louisiana booster stations were not operating yesterday, September 1, and a third has been operating intermittently due to unreliable power. None of these issues are expected to be long in duration, and service could resume on Tuesday. Parts of the Colonial system not directly impacted by Hurricane Gustav continue to operate normally.
• As of 9:00 AM EDT, September 2, the force majeure declared by Sabine Pipeline on August 31 has not been lifted and all facilities connected to the system remain shut-in, including the Henry Hub operations. The Henry Hub is the largest centralized point for natural gas spot and futures trading in the United States.
• There are fourteen natural gas pipelines in the Gulf of Mexico that have declared force majeure resulting in complete shut-in of their systems. Eight pipelines have posted notices to their shippers informing shippers of reduced supply from offshore production, shutdown of processing plants and compressor stations along their systems. In addition, six pipelines have notified their customers of no operational impacts from Gustav.
• Twenty-five out of thirty-one major natural gas processing plants were shut-in in the path of the storm totaling 16.1 billion cubic feet per day. Many of the plants took action to shut down operations and remove personal from the facilities due to the mandatory evacuations.
List of refineries impacted and status from page 4 of above-linked report from the DOE, Tuesday a.m. Sept. 2, 2008.
Without electricity, Tommy Trahan waits in his father-in-law’s home as Hurricane Gustav storms through Raceland, La., on Monday, Sept. 1, 2008. (AP Photo/Amy Sancetta)
The markets are assuming the best this morning, that Hurricane Gustav didn’t do much damage to the offshore/onshore energy infrastructure, namely because the storm didn’t get as strong as some predicted.
There’s no real news so far, just lots of “we will be checking our facilities today/tomorrow.” Exxon Mobil’s update this morning is typical:
We are assessing restart options, but are unable to provide a restart schedule at this time. The Baton Rouge Complex in Louisiana, which includes refining and chemical facilities, completed a safe shutdown of its operations on September 1.
The bigger recovery issue may end up being the restoration of electric power to the refineries and gas processing plants. Entergy, the power provider for parts of East Texas through Louisiana and Mississippi, is calling this its second-worst outage ever.
“As of 5 a.m. this morning, electrical power outages from Hurricane Gustav had reached more than 825,000, the second largest outage in company history, behind only Hurricane Katrina. Gustav restoration rivals the scale and difficulty of Hurricane Katrina restoration. Transmission system restoration is particularly challenging due to massive damage to the system. …
Entergy’s transmission system has sustained massive damage, with 191 transmission lines and 210 substations out of service.
The New Orleans and Baton Rouge area remains essentially an island, no longer electrically connected to the rest of the system. Waterford 1, Nine Mile Point and Little Gypsy are now supplying all power to this area because all transmission lines leading to and from the area are out of service.”