[UncoveringTruths]

$this->bbcode_second_pass_quote('', 'H')urricanes Katrina and Rita dealt such a severe blow to oil and gas production in the Gulf of Mexico that energy experts now say the flow of petroleum won't be fully restored until next summer.

"The damage was more severe and in harder-to-reach places than many expected, such as the bottom of the ocean, that usually isn't affected that much," said Steve Parker, energy analyst at Kercheville & Co. in San Antonio. "The storms tracked right through the heart of the gulf's oil and gas operations."

The two storms plowed through 3,050 of the 4,000 drilling platforms in the gulf, destroying 108 mostly old structures and significantly damaging 53 platforms. Modern equipment fared better; only one major platform was damaged significantly, the Minerals Management Service has reported.

Even so, 28 percent of gulf oil production remains closed, amounting to almost 414,495 barrels a day. And more than 2.01 billion cubic feet of natural gas — 20 percent of the regular daily gas production — remains shut down, the Minerals Management Service said Monday.

The reduced gulf production is just part of the storm-related damage to the U.S. energy industry.

Some output from the Gulf Coast's extensive refining operations is still down. About 804,000 barrels of gasoline production a day is off line, with two refineries still closed, two operating at reduced rates and a fifth that won't be at full production for about two weeks, the Energy Department said.

Repairs continue to pipelines and processing plants.

"One of the key problems is that tremendous damage was done to offshore pipelines and the natural gas processing plants in coastal zones," said Jim Flanagan, regional manager for the deep-water gulf group at IHS Energy, a Houston-based consulting company.

"Some of the repairs are beyond the control of the company," Flanagan said, "and they have to depend on a third party to fix it."

For example, some oil and gas companies don't own every pipeline that transports the oil and gas they extract to the Texas and Louisiana coasts.

And all companies facing repairs continue to deal with shortages of equipment and workers.

[Doly]

$this->bbcode_second_pass_quote('UncoveringTruths', '
')Has there been any forecasting on Hurricane activity next year?

[The_Virginian]

Bright Side:

Only 20-30% was knocked out. When it's put up agin, let's hope it's done even better.

(yes I had my coffie today)

[bobcousins]

Extracting oil from the GOM without incident has worse odds than Russian Roulette!

[turmoil]

[PWALPOCO]

Is there any precedent for carrying this amount of shut in from one year into the next ? What kind of utilization % is there traditionally in the GOM anyway ?

Paul

[Hegel]

May God have mercy upon us and suspend the next Hurrikan-season. Otherwise the DoE has to introduce a yearly "GoM Damage Report" from this year on - unless the DoE ceases to exist in the meantime by other reasons.

[nth]

$this->bbcode_second_pass_quote('Hegel', 'M')ay God have mercy upon us and suspend the next Hurrikan-season. Otherwise the DoE has to introduce a yearly "GoM Damage Report" from this year on - unless the DoE ceases to exist in the meantime by other reasons.

[Caswell]

Did Katrina and Rita destroy 20-25% of US GOM oil production capacity?

Take a look at the following Katrina/Rita oil production shut-in rates, where Minerals Management Service (MMS) figures show production over the nearest fortnight:

Sept 28th 05--100% (combined Katrina/Rita disruption)
Oct 3rd--92.80%
Oct 18th--65.45%
Nov 2nd--63.86%
Nov 16th--48.35%
Nov 30th--36.48%
Dec 15th--28.42%
Dec 29th--27.37%
Jan 9th 06--26.82%

Now look at the figures over 3-4 week periods. The recovery rate between Dec 15th and today appears to be very small--less than 2%--compared to what was achieved before. In previous 3-4 week periods, gains varied between 18% to 35%.

After Ivan, if I remember correctly, recovery more or less flatlined 80 to 90 days after maximum shut-in. We're at some 110 days since the maximum combined Katrina/Rita shut-in. (However, remember that Katrina hit at the end of August, some 130 days ago, causing a maximum 95% shut-in, recovering to 56% before Rita evacuations started Sept 19th/20th. )

I'm no oil industry expert but I thought that the Christmas and New Years holidays might explain the slow pace of recovery. However, tonight, the MMS announced that, as of Jan 11th, it would post the disruption stats fortnightly. (Previously it was every few days and before that daily.) This is because of 'the relatively small variations in the shut-in statistics' and over 'the last few days there has been minimal improvement in the production numbers... this appears to be a trend that will continue with incremental movement over the next several months (mms.gov).'

I recognise that the above extrapolations aren't particularly scientific, but I want to pose 2 questions;

1)are we looking at the permanent loss of 20-25% of GOM oil production, roughly 6 to 8% of overall US domestic oil production?

and

2)coupled with the EU and Japan ending oil aid shipments to the US, will there be a significant impact on the price of oil?


I'll just nerd out some more for GOM gas production in the interests of discussion!

Aug 31st--87.99% (max Katrina disruption)
Sept 14th--35.18%
Sept 19th-- 33.75% (max recovery before Rita)
Sept 25th--80.47% (max Katrina/Rita disruption)
Oct 11th--60.42%
Oct 25th--55.82%
Nov 8th--41.23%
Nov 22nd--32.19%
Dec 6th--26.5%
Dec 19th--20.14%
Jan 5th 06--18.79%
Jan 9th--18.56%


Figures from US Mineral Management Services

[cudabachi]

Sorry, I could not do a direct link to this story:

Mexico's Fox To Announce New Deep Water Oil Find-Magazine
3:12 PM ET March 10, 2006


MEXICO CITY (Dow Jones)--Mexican President Vicente Fox said he will soon announce another oil find in deep waters of the Gulf of Mexico, the business magazine Expansion reported this week.

In its current edition, Expansion cited Fox as saying in an interview that the magnitude of the deposit has yet to be determined. Mexican state oil monopoly Petroleos Mexicanos (PEM.YY), or Pemex, had no comment.

With production at Pemex's giant Cantarell oilfield starting to decline this year, Pemex sees deep water exploration among its best bets to increase oil and gas production and build up declining reserves.

But the company doesn't have the know-how to develop deep water reserves, and the Constitution bars it from forming partnerships with companies that do to get the oil out.

"The country lacks the technology and economic resources to drill in its deep waters," Expansion cited Fox as saying. "We are depriving ourselves of access to these large deposits in the Gulf of Mexico which the U.S. and Cuba are already exploiting."

Pemex hit its first deep water oil in late 2004, when it contracted Diamond Offshore Drilling (DO) to drill a well at a depth of 681 meters in the Campeche Sound, producing an initial flow of 1,200 barrels a day of very heavy crude

[Leanan]

Hmm. I wonder what they will do?

Open up to foreign investment?

Or Forgo Deep-Water Oil?

[lateStarter]

Translation - Fox says: We have found (that Exxon/Shell/BP have 'found') lots of Deep Water oil in an area that could bring enormous benefits to our country (me and my buddies). We are awaiting further developments.

[mekrob]

So there first deep water find was of 'very heavy crude'. So is this typical in the GOM? Is it mostly (very) heavy crude or is it diversified? (Sorry for the beginner's question)

[alecifel]

I'm by no means an organic chemist, or a geologist, but I will tell you this: the deeper in the earth oil is found, the older it is; and the older it is, the less viscosity it will probably have, because greater pressures and temperatures at deeper layers will have forced more of the light stuff out.

Just an educated guess at a theory.

NJA

[elroy]

I thought since it's deeper it's hotter and more pressure, essentially making it into a 'cracker' resulting in light sweet oil ?

[Novus]

The oil may not be deeper in the Earth's crust. The oil is just deeper under water which would mean the oil is colder.

[0mar]

lol let's get rockdoc123 in here

[Bleep]

$this->bbcode_second_pass_quote('', '[')url=http://www.eluniversal.com.mx/miami/17376.html]Fox announces discovery of offshore field (link)[/url]
Mexico has made a deep-water oil discovery in the Gulf of Mexico that could be larger than the country´s giant Cantarell offshore field, President Vicente Fox said on Monday.

[waegari]

Not just that. Here's a quote from the same article:

$this->bbcode_second_pass_quote('', 'P')emex sees deep-water crude as one of its best bets for replacing reserves and for increasing production as Cantarell declines.

The fastest way for Pemex to get the oil out would be by forming alliances with companies that have the deep-water technology. However, current laws forbid private companies from exploration and production activities in Mexico except when they are under contract to Pemex.

[slick50]

I suppose it could be true. One can not prove a negative. But Mexican officials have not exactly been honest in the past in regards to oil discoveries. This might be posturely in reaction to the news of Cantarel's upcoming production crash.

http://www.washingtonpost.com/wp-dyn/ar ... Aug30.html