U.S. Energy Firms Tally Damage, Plan Restarts Following Hurricane Laura

Reuters, August 27, 2020

U.S. energy companies on Thursday were organizing crews to evaluate offshore Gulf of Mexico platforms and assess damage to coastal operations as Hurricane Laura took its fierce winds inland.

The storm hit Louisiana early Thursday with 150 mile-per-hour (240 kph) winds, damaging buildings, knocking down trees and cutting power to more than 650,000 people in Louisiana and Texas. However, Laura’s storm surge was much less than predicted, sparing refineries from feared massive flooding.

Offshore operators were scheduling reconnaissance flights over the more than 300 offshore platforms and drilling rigs whose crews evacuated last week. Laura tore through the Gulf of Mexico’s prime oil fields, with first assessments due Thursday for pipelines and platforms.

About 84%, or 1.56 million barrels per day, of U.S. Gulf of Mexico crude output and 60% of natural gas offshore production remained shut on Thursday, the U.S. Department of Interior reported.

Chevron Corp has begun to redeploy workers and restore production at its offshore fields. Equinor plans a weekend flyover of its Titan platform and BP is preparing to return workers, spokespeople said.

As far as we know, there have not been offshore impacts,” said Suzanne Lemieux, a emergency response official with trade group American Petroleum Institute.

The ports of Beaumont, Port Arthur, Orange, and Sabine in Texas and Lake Charles and Cameron in Louisiana remained closed on Thursday, the U.S. Coast Guard said. Lake Charles avoided significant flooding but was closed by power outages, said Ed Manint, manager of security and safety.

Storm-related liquefied natural gas (LNG) plant closures put U.S. LNG exports on track to fall to 2.1 billion cubic feet per day on Thursday, the lowest level since February 2019, according to data from Refinitiv.

Oil companies have not changed regularly scheduled Saturday crew changes, said Lani Moneyhon, manager of Bristow Group’s Galliano heliport. The company provides transport to offshore sites.

Even with no or little damage, oil refineries could take days to resume production from a cold shut and the widespread power outages in the region and evacuations could slow the process further.

Utilities reported more than 650,000 customers in Texas and Louisiana were without power on Thursday.

Chevron Corp said its Pasadena, Texas, and Pascagoula, Mississippi, refineries - both well away from the storm’s center - sustained no damage, and it was continuing to supply customers with fuel.

Exxon Mobil Corp was contacting employees at its 369,000 bpd oil refinery and chemical plant in Beaumont, Texas, and reviewing for any damages. The large plant was one of six plants along the Gulf Coast’s refinery row that shut this week ahead of the storm.

Refiner Phillips 66 expects to run a thorough evaluation once it can access its 260,000 bpd Lake Charles refinery, said spokesman Dennis Nuss.

(Reporting by Erwin Seba, Laila Kearney, Devika Krishna Kumar, and Liz Hampton; Writing by Gary McWilliams; Editing by Marguerita Choy)

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