Oil companies eye recovery from weak Gulf storm
NEW YORK (Reuters) - Oil companies with operations in the Gulf of Mexico were eyeing a fast recovery from a meandering storm that triggered evacuations from offshore rigs earlier in the week and slashed a huge chunk of the region's oil and natural gas output.
The National Hurricane Center said on Friday the tropical depression, the tenth to form this Atlantic hurricane season, was not expected to gather much strength before hitting the Mississippi coastline sometime on Saturday.
French oil major Total SA (TOTF.PA) said Friday it was planning to send workers back to its offshore facilities in the Gulf on Sunday if weather forecasts continued to indicate the foul weather would not strengthen much.
Transocean (RIG.N) said it was also preparing to return crews to its Gulf of Mexico installations.
"Assuming no other storms, they should all be back up and running by Monday," said Jim Ritterbusch, president of Ritterbusch and Associates.
The weak cluster of squalls in the northeastern Gulf of Mexico has already shut in 62.7 percent of the region's oil production and 30.8 percent of its natural gas after oil companies airlifted workers from rigs as a precaution.
"You can never predict what one of these things will do and that's why the oil industry is being so cautious," said Richard Wheatley, spokesman for El Paso Corp. (EP.N)
Shell said on Thursday it shut all of its Gulf production, which totals 370,000 barrels of oil equivalent per day. BP Plc (BP.L) said it was also shutting all of its production and stopping work on all vessels and facilities.
Other operators, including Apache (APA.N), Anadarko Petroleum Corp (APC.N), Exxon Mobil (XOM.N), ConocoPhillips (COP.N) and Total were also reducing output from the region.
Oil struck a record above $84 a barrel on Thursday as dealers weighed the possibility of significant production outages from the region, home to about a quarter of U.S. oil production and 15 percent of the nation's natural gas output.
Oil prices on Friday were down 48 cents at $81.30.
The U.S. Minerals Management Service said that by late morning Friday 814,578 barrels per day of oil production, or 62.7 percent of the Gulf's output, and 2.371 billion cubic feet of natural gas output, or 30.8 percent of its gas production, was shut down.
Oil refiners on the Gulf Coast were watching the storm closely, but had not announced any shutdowns.
"We are monitoring the situation and will take appropriate action if and when necessary," said Citgo spokesman Fernando Garay about the company's refinery in Lake Charles, Louisiana.
The Louisiana Offshore Oil Port, a major conduit for U.S. crude imports, added Friday it did not expect the foul weather to affect operations. Continued...
