offshore oil and gas

U.S. Oil Firms Restoring Operations in Storm-Battered Gulf of Mexico

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October 11, 2018

FILE PHOTO: An oil and gas drilling platform stands offshore in the Gulf of Mexico in Dauphin Island, Alabama, U.S., October 5, 2013. REUTERS/Steve Nesius/File Photo

ReutersHOUSTON, Oct 11 (Reuters) – Major oil producers and drillers, including Chevron Corp and BP Plc, on Thursday began returning crews to more than 90 offshore facilities in the U.S. Gulf of Mexico that were evacuated this week as Hurricane Michael moved through the Gulf.

Production shut-ins that had temporarily halted 42 percent of Gulf oil output and nearly a third of natural gas production were being reversed in some areas.

Chevron said it was reactivating two production platforms that were evacuated. BP also was redeploying crews to four platforms after completing aerial safety checks. It expects to resume sending production through pipelines linking the facilities to the shore.

Restarting production can take several days. Producers lost about 1.7 million barrels of oil through Wednesday as a result of shut-ins and the figure is expected to rise. However, Gulf production cuts have been less of an impact on supplies with the rise of U.S. shale oil.

Almost 850,000 electricity customers in the U.S. Southeast were without power on Thursday, according to local utilities, as the storm headed for the Carolinas.

Power outages were delaying fuel deliveries in Georgia to customers of Colonial Pipeline, the country’s largest fuel network, its operator said on Thursday. Colonial said it was assessing damages and working to resume service.

The storm brought winds of up to 155 miles per hour (250 kph) when it made landfall in the Florida Panhandle on Wednesday. Drenching rains were falling on Georgia and the Carolinas on Thursday.

U.S. crude futures continued to drop for second day, losing $1.88 to $71.29 per barrel in midday trade, as global stock markets fell, with investor sentiment made more bearish by a bigger-than-expected U.S. crude inventories build.

Anadarko Petroleum Corp said on Thursday it had expanded its shut-ins to three offshore platforms, and for safety reasons was waiting to return workers.

Gas production should move up to 2.3 billion cubic feet per day (bcfd) on Thursday from a low of 2.2 bcfd on Tuesday, according to Refinitiv data. A week ago, energy firms were pulling 3.5 bcfd from the offshore wells.

Southern Co kept the two reactors at its 1,751-megawatt Farley nuclear power plant in Alabama reduced at around 30 percent early Thursday. The company reduced the reactors from around full power on Wednesday as Hurricane Michael approached the coast. The Farley plant is located in Dothan in southeast Alabama about 90 miles (150 km) north of the Gulf Coast. (Reporting by Gary McWilliams in Houston, Scott DiSavino and Stephanie Kelly in New York Editing by Marguerita Choy)

(c) Copyright Thomson Reuters 2018.

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