Bloomberg News

Tropical Storm Curtails Gulf of Mexico Energy Output

June 24, 2012

Anadarko Petroleum Corp. (APC:US), BP Plc (BP/) and other oil and natural-gas companies curtailed production in the Gulf of Mexico as a weather system strengthened into Tropical Storm Debby, the fourth named storm of the year.

The U.S. Bureau of Safety and Environmental Enforcement said 7.8 percent of oil production and 8.2 percent of gas output in the Gulf has been halted. Anadarko shut four platforms, and BP started closing some oil and gas wells. Apache Corp. (APA:US) and two other companies began evacuating non-essential workers from some facilities.

Debby was moving slowly northward as of 5:00 a.m. New York time with maximum sustained winds of 50 miles (80 kilometers) per hour and swells as high as 19 feet (six meters), according to the National Hurricane Center. The storm’s projected path indicated it was heading for the Louisiana coast west of New Orleans and would make landfall as early as Monday afternoon before moving west toward Texas. The storm has a 29 percent chance of intensifying to a hurricane by June 26, according to the forecast.

“We do have it strengthening, and it certainly can’t be ruled out that it will reach hurricane strength, but right now all we’re projecting is a tropical storm,” Dennis Feltgen, a spokesman for the hurricane center in Miami, said in a telephone interview.

Early Evacuations

The Gulf of Mexico is home to 6.5 percent of U.S. gas production, 29 percent of oil output and 40 percent of refining capacity. Offshore oil and gas platforms need to carry out evacuations well in advance of a storm’s arrival, so any system in the Gulf can cause production disruptions.

BP, Apache and Chevron Corp. (CVX:US) said on their websites that they began withdrawing non-essential personnel from some Gulf facilities yesterday. ConocoPhillips (COP:US) said it’s taking non- essential employees off its Magnolia platform. BP began shutting some wells as it pulled workers and contractors from offshore platforms and rigs in the expected path of Debby, Brett Clanton, a Houston-based BP spokesman, said in an e-mail.

Anadarko halted production at its Neptune, Independence Hub, Constitution and Marco Polo facilities in the eastern and central Gulf of Mexico, the company said on its website. The company will evacuate all employees from the platforms, it said.

Neptune, Shenzi

BHP Billiton Ltd. (BHP) shut the Neptune and Shenzi platforms, which can together produce 150,000 barrels of oil a day and 100 million cubic feet of gas, on June 22. Murphy Oil Corp. (MUR:US) began evacuating non-critical workers on the same day, as did Anadarko, Marathon Oil Corp., Nexen Inc. (NXY), Enterprise Products Partners LP and Hess Corp. (HES:US)

Royal Dutch Shell Plc (RDSA) may remove some non-essential workers from rigs in the central and western Gulf in the next few days, the company said on its website.

ERA Helicopters LLC of St. Charles, Louisiana, reported ferrying workers from offshore platforms. Melanie Landry, a spokeswoman for ERA, declined to comment on which companies had called for evacuations.

Jim Rouiller, senior energy meteorologist at Planalytics Inc. in Berwyn, Pennsylvania, said this is the first real threat of the year in the Gulf of Mexico. With the relatively mild start to summer, he said, “this will get the traders looking and saying, ‘Hey, we got something ominous for the Gulf.’”

Wind shear is pushing most of Debby’s wind speed and thunderstorms to the Gulf’s eastern edge, said Mike Pigott, a senior meteorologist with State College, Pennsylvania-based AccuWeather Inc.

Gain Strength

“As long as it remains over the open, warm waters of the Gulf, it could continue to gain strength,” he said. “If the shear relaxes, it could become a hurricane before reaching Texas.”

A storm gets a name when its winds reach 39 miles (63 kilometers) per hour and becomes a hurricane at 73 miles per hour.

Debby is the fourth storm of the Atlantic hurricane season, which runs from June 1 to Nov. 30. It’s the first time since record-keeping began in 1851 that four storms have formed in the Atlantic before July 1, Feltgen said.

“This is the seventh Atlantic season in recorded history where three storms have formed before July 1,” he said. “We have never gone with four storms before July 1.”

To contact the reporters on this story: Dan Murtaugh in Houston at dmurtaugh@bloomberg.net; Brian K. Sullivan in Boston at bsullivan10@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net


Toyota's Hydrogen Man
LIMITED-TIME OFFER SUBSCRIBE NOW

Companies Mentioned

  • APC
    (Anadarko Petroleum Corp)
    • $83.65 USD
    • -1.21
    • -1.45%
  • APA
    (Apache Corp)
    • $63.74 USD
    • -1.08
    • -1.69%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus