4. HURRICANE:
Cleanup continues after Isaac's Gulf torrent
Published:
HOUSTON -- Oil and gas producers are busy bringing shuttered rigs back into operation after the offshore energy industry withstood a direct hit by Tropical Storm/Hurricane Isaac in the Gulf of Mexico.
The storm eventually made landfall as a Category 1 hurricane, a sharp contrast to Hurricane Katrina, which in 2005 cut across the Gulf as a Category 5 and sidelined producers for weeks. The Interior Department's Bureau of Safety and Environmental Enforcement (BSEE) yesterday reported that operators were making rapid progress in restoring offshore platforms and drilling rigs. But government investigators were also at work this weekend searching for signs of oil leaks.
At the peak of the evacuation of personnel from the Gulf, BSEE said that more than 94 percent, or about 1.3 million barrels per day, of all crude oil production had been offline. As of yesterday, that figure had shrunk to 58 percent, or around 800,000 barrels per day.
That number is expected to go down rapidly this week as crews bring installations back online. Only 11 percent of producing platforms remain evacuated, BSEE reported, and less than 8 percent of active drilling rigs are still shut down because of the storm.
Any damage suffered by the industry as a result of Isaac so far appears minimal, the agency reported.
"BSEE inspectors are flying offshore and inspecting production platforms and drilling rigs," spokesmen there said in an update. "BSEE Hurricane Response Team is receiving some damage reports from oil and gas operators and is verifying and compiling the information. Initial reports indicate mainly minor damage at this point."
Almost 38 percent of the Gulf's natural gas production is still offline. That's down from a peak of 72 percent shut in as the storm rolled through.
Oil and gas traders mostly shrugged off Isaac's appearance over the heart of the U.S. offshore energy industry, though futures prices were pushed up in international trading yesterday. During the storm, benchmark West Texas Intermediate (WTI) prices stayed mostly flat, while Henry Hub natural gas prices crept higher.
WTI crude oil futures for October delivery are now trading at about $96 per barrel.
Still, there is concern that Isaac could have caused another oil leak. Indications so far suggest the hit is relatively minimal. On Sunday, the Coast Guard reported that it had discovered birds covered in oil in an area where Isaac passed over directly. About a dozen dead animals that officials say were covered in oil were found in the Myrtle Grove district just southeast of New Orleans. U.S. EPA, the Coast Guard and the Louisiana Department of Environmental Quality are looking for the source of the oil.
"One dead juvenile pelican, 10 oiled dead nutria and two live oiled pelicans were located in the marshes in the vicinity of Myrtle Grove, Sunday," the Coast Guard said in a release. "Teams located oil in the marshes in the vicinity of two inactive oil production facilities near Myrtle Grove, although there is no sign of an active leak, and it is still unclear if the oil originated from these facilities."
Although an expensive federal flood protection system successfully safeguarded New Orleans as Isaac hit the city on the seventh anniversary of Hurricane Katrina, rural areas outside the city were not so lucky. Low-lying Plaquemines Parish was inundated by storm surges that overflowed its levee system, leaving emergency personnel scrambling to evacuate people who ignored an earlier order to flee.