* Coast Guard says will re-open channel 'as soon as we can'
* More than 80 inbound and outbound vessels waiting to move
(Updates with detail about re-opening; adds quotes, byline;
By Erwin Seba
TEXAS CITY, Texas March 24 U.S. authorities
expected a "tapered" re-opening of the Houston Ship Channel, but
gave no timeline on Monday of when vessels could start moving
again after an oil barge spill shut the waterway for a third
day, forcing the nation's second-largest refinery to curb
"We will begin the process of a tapered ... not a floodgate
resumption of marine traffic," Captain Brian Penoyer, commander
of U.S. Coast Guard sector Houston-Galveston and captain of the
Port of Houston, told reporters on Monday.
"We anticipate re-opening the Houston Ship Channel as soon
as we can," he said.
Earlier on Monday, the Coast Guard had told ship operators
that it should be able to reopen the waterway later in the day,
resuming at least some supply of crude oil to more than
one-tenth of the nation's refining capacity. A Coast Guard
spokesman declined to discuss the timeline.
Even earlier, officials had said the channel could remain
shut for several more days. Penoyer explained that traffic can't
move again until there's no more oil in the water to cling to
ships and be carried further. Also, any ships that were touched
must be cleaned before moving through water deemed sufficiently
clean, he said.
The closure of the channel on Saturday has led to a queue of
more than 80 vessels trying to move into or out of the Gulf of
Mexico. Shipping delays forced Exxon Mobil Corp to cut
production at its largest refinery.
Exxon said production at its 560,500 barrel per day Baytown,
Texas, refinery had been cut on Monday due to the closure of the
Houston Ship Channel. The company expects further production
cuts by mid-week if the channel remains shut.
INVENTORIES CONSIDERED AMPLE
Analysts on Monday were largely unconcerned, noting that
ample inventories in the region provide a cushion for refiners.
But a senior engineer at a Houston-area refinery that
depends on crude deliveries through the ship channel was
concerned about the requirement that the water be cleaned of any
thick fuel oil before ships run back and forth to ensure they
don't track it further upstream or into the Gulf.
"We're toast," the engineer said. "I would say this is a big
problem. Any delay is bad, but three days or more is really bad
because we use the channel to bring crude and products in and
The ship channel was shut on Saturday after a collision
between a Kirby Inland Marine oil barge and a cargo ship,
spilling some 4,000 barrels, or 168,000 gallons (636,000
liters), of residual fuel oil. The channel allows oil barges and
cargo ships to sail from the Gulf Coast to refiners and
terminals further inland.
Penoyer said the thick viscosity of the oil made it
recoverable by skimmers.
A total of 39 ships were waiting to leave the port of
Houston and 43 ships were waiting to come in, the Coast Guard
said on Monday afternoon. Penoyer said a typical day in the
channel includes movement of 60 to 80 large ships - tankers,
freighters, containers and cruise ships - and 300 to 400 tug and
A warning to mariners issued by the Coast Guard on Sunday
said portions of the Houston channel and its offshoots to Texas
City and Galveston, Texas, along with a portion of the Gulf
Intracoastal Waterway, could be closed through March 29 or
longer, depending on the requirements of a cleanup.
Five ships waited to come into the ports of Texas City and
Galveston, Texas, and 12 ships waited to leave the ports, the
Coast Guard said.
Kirby Inland Marine is operated by Kirby Corp.
Penoyer said Kirby "immediately" stepped forward to take
responsibility for the response costs by hiring the cleanup
Cleanup crews have pumped all of the remaining fuel oil from
the barge, which has been refloated and moved to a different
position near the site of the collision in the channel.
Marathon Petroleum Corp. declined on Monday to
discuss operations at its 451,000-bpd Galveston Bay Refinery and
80,000-bpd Texas City refinery. Royal Dutch Shell's
joint-venture 327,000 bpd Deer Park refinery was evaluating
supply impacts and had contingency plans to mitigate them, a
Fewer than 10 oil-covered birds have been recovered for
cleaning, according Texas wildlife agencies.
(Reporting by Erwin Seba in Houston, Selam Gebrekidan in New
York, Terry Wade in Orlando; Editing by Jeffrey Benkoe, Stephen
Powell, Bernard Orr and Cynthia Osterman)