Evacuations were underway on Sept. 13 from offshore U.S. Gulf of Mexico oil platforms as onshore oil refiners began preparing for rain and heavy winds from a second hurricane in as many weeks.
Hurricane Nicholas was taking aim at the central Texas coast with 75 miles per hour (120 kph) winds, threatening to bring heavy rain to Texas and parts of Louisiana still recovering from Hurricane Ida.
Life-threatening flash floods from up to 12 inches of rain are possible along the upper Texas coast to southwest Louisiana. Nicholas intensified into a category one hurricane late Sept. 13 but is not expected to strengthen further, the National Hurricane Center said.
Nicholas is the second cyclone to threaten the U.S. Gulf Coast energy complex in recent weeks. Hurricane Ida wreaked havoc on oil production and refining facilities in late August and early September. Some 113,000 Louisiana homes and businesses have been without power since Ida struck.
Ida Damage
More than 40% of the U.S. Gulf of Mexico’s oil and gas output remained offline on Sept. 13, two weeks after Ida slammed into the Louisiana coast, according to offshore regulator Bureau of Safety and Environmental Enforcement (BSEE).
Damages to an offshore hub that pumps oil and gas from three major oil fields for processing onshore and power outages at onshore processing plants are responsible for the production losses.
Royal Dutch Shell Plc said it had begun evacuating non-essential personnel from its Perdido platform, which was unaffected by Ida. Occidental Petroleum Corp. said it was implementing procedures to safeguard workers, signaling its own offshore evacuations.
Shippers were warned of hurricane-force winds at oil export terminals on the Texas coast. The Houston Ship Channel, a 53-mile (85 km) waterway crucial to oil and fuel exports, halted all traffic, and the Aransas-Corpus Christi pilots suspended activities due to heavy seas.
There were 55,000 homes and businesses without power late Sept. 13, according to tracking website PowerOutage.com.
Oil refiners Citgo Petroleum, Exxon Mobil Corp., Phillips 66, and Shell said they were preparing some of their Texas and Louisiana coastal plants for severe weather.
Slow Storm
“The big thing is going to be the rain. I’'s going to be a slow-moving storm. When storms move at 5 of 8 miles per hour it can take a while for them to clear out,” said Phil Klotzbach, a researcher at Colorado State University.
WTI crude oil futures in the U.S. rose at the open in Asia on Sept. 14 after climbing 1% the day before to $70.45/bbl on continued disruptions to offshore production.
Oil imports and exports face potential delays from Nicholas. Vessels that were unable to load or discharge during Ida could be prevented from reaching ports again, shippers said.
The first supertanker scheduled to dock since Ida at the Louisiana Offshore Oil Port (LOOP), the largest U.S. privately owned terminal for crude exports and imports, has yet to load, according to Refinitiv Eikon vessel tracking.
Editor’s note: This story was updated at 4:05 a.m. CST Sept. 14.
Recommended Reading
Antero Sets Record Production Despite Lower Rig Count
2023-11-03 - Antero Resources’ management is hopeful the industry’s reduction in rig activity will help “balance” the natural gas market.
Range Resources All About ‘Efficiency’ in Third Quarter
2023-10-26 - Stressing its efficient use of resources, Range Resources management cited statistics from FactSet showing that in 2023 the company’s capex averaged $0.76 per Mcfe.
Troubled Tellurian Issues ‘Going Concern’ Warning Amid Losses
2023-11-07 - Tellurian Inc., which is still eyeing development of the Driftwood LNG export project in Louisiana, issued a frank warning to investors in its third quarter 2023 financial filing “about our ability to continue as a going concern.”
Plethora of Projects to Boost Kosmos Energy’s Future
2023-11-09 - With a slew of projects either beginning or set to come online, Kosmos Energy is poised for a big 2024.
Strong Demand is Keeping Oil Prices Elevated—But for How Long?
2023-09-18 - Rig counts are falling—a reflection of higher interest rates and labor costs that now affect drilling costs, moving break-even prices even higher out in the price curve.