The oil and gas story from Hurricane Gustav is that the disruption could have been worse. Part of the reason it could have been worse is a bundle of lessons taught by the storm’s nastier predecessors of 2005.
Gustav’s center made landfall near Morgan City, La., in the late morning of Sept. 1 as a Category 2 hurricane, with maximum sustained wind speeds near 110 mph. En route to Louisiana it crossed much of the oil and gas producing area of the Gulf of Mexico. It also idled a major segment of the Gulf Coast refining, petrochemical, and gas processing industry with personnel evacuations, power outages, and the threat of physical damage.
According to the US Minerals Management, the storm forced the shut-in of all Gulf of Mexico oil production, 1.3 million b/d, and 95% of the gulf’s gas production, 7 bcfd. The US Department of Energy’s Office of Electricity Delivery and Energy Reliability reported 14 refineries closed on Sept. 1, with total distillation capacity of 2.7 million b/d. That’s 15% of Oil & Gas Journal’s estimate of total US refining capacity as of Jan. 1. The DOE office said 10 other Gulf Coast refineries, with capacities totaling 3 million b/d, had trimmed operations.
In preparation for Gustav, most oil and gas pipelines suspended operations. Ports, including the deepwater Louisiana Offshore Oil Port, closed. Thirty-one major gas processing plants, representing a combined 16.1 bcfd of capacity, shut down.
Gustav damage minimal
At this writing, on Sept. 3, companies were beginning to inspect facilities. According to early reports, damage was minimal. DOE said, for example, that 16 of the closed gas processing plants reported little damage and would be able to resume operation once gas flow resumed. One of the shut-down refineries was restarting. Several pipelines were operating or restarting. There were no immediate reports of drifting drilling rigs or damaged production platforms. Crucially, however, electric power remained unavailable in much of the area affected by the storm, including Baton Rouge and New Orleans.
If the first hopeful reports hold up, Gustav will prove to have been much less damaging than Hurricanes Katrina and Rita 3 years ago. That double punch destroyed 115 platforms, damaged 52 others, and hurt 535 pipeline segments. Combined, the two storms set 19 mobile rigs adrift and at one point held 4.9 million b/d of refining capacity offline.
Katrina and Rita were stronger storms than Gustav. They were Category 5 hurricanes while over the gulf, with sustained wind speeds exceeding 155 mph. They came ashore as Category 3 storms, with winds speeds of 111-130 mph. Gustav was a Category 3 hurricane during most of its time over the gulf.
Still, Gustav was a major storm that slammed the nexus of US hydrocarbon production and processing. If it proves to have done little damage, a big part of the reason will be preparations improved by the lessons of Katrina and Rita.
Tougher standards
After those hurricanes, the Minerals Management Service, American Petroleum Institute, and company representatives collaborated on toughened design and assessment criteria aimed at improving the abilities of offshore structures to handle wind, waves, currents, and surge. MMS published a rule adopting the new standards before the start of the current hurricane season. An area of major improvement since the 2005 storms, API says, is the mooring of mobile drilling units.
Refiners and pipeline operators also fortified their hurricane preparations in response to the earlier storms, according to API. They have, for example, worked with electric utilities to speed the restoration of power after a storm and expanded their back-up generation capacity. They also have improved communications systems, fortified onshore structures, and enhanced post-storm availability of equipment and material (OGJ Online, Aug. 31, 2008).
Gustav gave these upgrades to US hurricane preparedness a solid test. That the improvements seem to have earned passing grades, however, is no reason to relax. Two days after Gustav went ashore to begin its windy and wet demise, the National Hurricane Center was tracking three other tropical storms with potential to enter the Gulf of Mexico.
