Argus Media Limited

09/08/2021 | News release | Distributed by Public on 09/08/2021 15:18

US Gulf operators struggle to restore output: Update

Adds updated offshore production data.

More than a week after Hurricane Ida tore through the Gulf of Mexico, offshore oil and gas producers are still struggling to restore operations that were suspended ahead of the storm.

The volume of offshore oil output shut in was at 77pc, or 1.399mn b/d, as of 12:30pm ET today, according to the Bureau of Safety and Environmental Enforcement (BSEE). That is only slightly down from 79pc, or 1.4mn b/d, yesterday. About 77pc of offshore natural gas production in the US Gulf was also off line.

Issues that may be hindering the resumption of operations include damage to structures like Shell's West Delta-143 shallow water platform, which serves as a hub for numerous offshore production pipelines.

'This is one of the largest hurricane production outages in the US Gulf of Mexico in recent years, and supply has felt it, as Ida's impact has already surpassed that of Hurricane Katrina,' says Rystad Energy analyst Nishant Bhushan.

Occidental Petroleum said its offshore platforms did not incur any damage as a result of the hurricane. While three of its 10 platforms have restarted output, and another three are preparing to start up, the remaining four remain off line as the company works with its partners to assess the potential impact to third-party midstream and downstream infrastructure.

Occidental's shore-based support facilities did sustain damage and the company has temporarily relocated some operations elsewhere.

'As our operations in the Gulf of Mexico are reliant upon third parties, we cannot provide a timeline for full restoration of operations at this time,' Occidental said.

Independent producer Murphy Oil is withdrawing its production guidance as it awaits third-party downstream reports due to the hurricane. The company said in a filing that its operated facilities were re-manned shortly after the storm and are ready to restart production. Net output is currently around 9,000 b/d of oil equivalent (boe/d), with 1,000 boe/d down for repairs, and there are no signs of any pipeline leaks.

BP said it is in the process of restarting its four Gulf of Mexico platform, with Atlantis and Mad Dog starting up and Thunder Horse and Na Kika expected to follow suit in the coming days.

At Port Fourchon, Louisiana, the staging base for ships that supply equipment and crews for many offshore operators, officials said they have begun to welcome back 'large customers' after its waterways were cleared of storm-related obstructions. Companies like BP and BHP moved operations from the port after Ida, with some shifting their onshore base camps and heliports to other ports and sites further away.

The port did not confirm which companies are resuming operations, but said it has re-established temporary fire and emergency services.

Murphy said its Port Fourchon shorebase is reopening in the near term, and backup locations are operational. The company's King's Quay floating production system arrived shoreside on schedule in September with no storm impact.

Chevron said its Fourchon terminal used for routing production from offshore platforms remains shut-in.

By Stephen Cunningham

US Gulf of Mexico offshore production Status 12:30pm ET 8 Sept
Total Change from 7 Sept % of GOM
Oil shut-in b/d 1,399,186 -44,614 76.9
Natural gas shut-in mn cf/d 1,723 -14 77.3
Platforms Evacuated 73 -6 13.0
Rigs Evacuated 4 0 36.4
- BSEE
US Gulf coast refinery status, post-Hurricane Ida
Name Capacity b/d Status as of PM, 8 Sept
Marathon Garyville 565,000 Restarting
ExxonMobil Baton Rouge 500,000 Restarting, receiving SPR crude
Phillips 66 Alliance 250,000 Shut, unspecified damage
Shell Norco 250,000 Shut, unspecified damage, flaring
Valero St Charles 215,000 Shut
PBF Chalmette 190,000 Terminal operating, startup expected week of 12 Sept.
Valero Meraux 135,000 Shut
Delek Krotz Springs 80,000 Unknown
Placid Port Allen 75,000 Normal, receiving SPR crude
- Companies