Oil firms begin US Gulf evacuation on Gustav threat

By Erwin Seba

HOUSTON (Reuters) - Energy companies in the U.S. Gulf of Mexico began evacuating staff from offshore platforms on Wednesday as Tropical Storm Gustav barreled toward the oil and natural gas-rich region.

Forecasters expect the storm to intensify into a major hurricane before it hits the Gulf, potentially forcing the shut-in of 85 percent of production in the region that accounts for a quarter of U.S. oil output and 15 percent of natural gas, according to Planalytics.

Shell Oil Co (RDSa.L) said it was evacuating about 300 nonessential workers from the Gulf of Mexico production platforms, while Transocean Inc (RIG.N) said it has pulled 30 workers off drilling rigs.

BP Plc (BP.L) said it was also pulling nonessential workers from the Gulf.

Shell and BP said production was unaffected by the evacuations.

Other companies were preparing to remove staff as well, according to a helicopter company involved in evacuations.

"Starting today, we're taking out nonessentials for most of the major oil companies," said Jim Shugart, executive vice president/sales for ERA Helicopters.

Other companies including ConocoPhillips (COP.N) were still monitoring the storm.

U.S. crude oil futures rose to a high of $119.63, before sliding back to trade above $117 a barrel, up nearly $2, while natural gas jumped more than 2 percent to $8.492, on fears about Gustav's impact on Gulf production.

If current storm tracks hold, Gustav will be the first major storm to blast oil and natural gas infrastructure in the Gulf since hurricanes Katrina and Rita devastated the region in 2005, shutting 25 percent of U.S. oil and fuel production.

"More and more of the tracks are all in agreement. Somewhere between Houston and New Orleans, we're going to have a problem. That's the heart of the platforms. And they're still saying Category 3 or higher," Commercial Brokerage Corp's Ed Kennedy said on Wednesday.

U.S. forecasters expect the storm to pack winds of more than 111 mph when it enters the Gulf of Mexico by Sunday.

Private and government forecasters said the storm could make landfall by midweek near Gulf refining centers.

"We see it close to Galveston by Monday or Tuesday night," said Paul Pastelok, senior meteorologist with AccuWeather.

The U.S. National Hurricane Center forecasts the storm will most likely strike the Louisiana coast.