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Power outage after Hurricane Laura prevents return to normal operations at U.S. oil reserve site

WASHINGTON (Reuters) - An ongoing power outage due to Hurricane Laura has prevented a return to normal operations at a Louisiana site of the U.S. emergency oil reserve, a U.S. Energy Department official said on Friday.

The West Hackberry site, one of four locations of the Strategic Petroleum Reserve, was shut before Laura hit the region to evacuate personnel. On Monday, the department said the site had “sustained considerable damage” from the storm but that there was “no threat to the integrity of the geologically sealed underground caverns” that store crude oil.

The site is staffed and secured, and damage assessment has begun, the official said. Estimates on repair times, costs and when the facility would be back to normal were not available.

West Hackberry has 21 caverns and a storage capacity of 220 million barrels of crude. The SPR currently holds nearly 650 million barrels of mostly sour crude, well over the level required by international agreements.

The SPR can still facilitate any emergency exchanges requests from refineries through its Big Hill, Bryan Mound and Bayou Choctaw sites, the department has said, though the reserve has not received any such requests.

Washington funded the building of the SPR in the 1970s, after the Arab oil embargo spiked gasoline prices and damaged the U.S. economy. The Energy Department has occasionally held emergency sales and loans of oil to companies in the wake of storms. Most recently it loaned oil after Hurricane Harvey inundated Texas in 2017.

Reporting by Timothy Gardner; Editing by Steve Orlofsky

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