Although Hurricane Earl ended up only grazing the Gulf of Mexicogas producing area last week, his impact was sudden and severe,triggering a near total evacuation of Gulf platforms, causing morethan 10 Bcf/d of curtailments (70% of Gulf production), accordingto the Minerals Management Service, and triggering a 25- to30-cent/MMBtu cash price spike on Tuesday.

“Everybody was watching the hurricanes on the Atlantic Coast andthis one just caught them by surprise,” noted MMS spokeswoman CarylFagot. Earl seemed to pop up out of nowhere Monday as a tropicalstorm north of the Yucatan Peninsula, and its uncertain course andspeed sparked a rapid evacuation process across the entire Gulf ofMexico.

“It’s Gulf-wide and even into the bays and lakes,” said a Texacospokesman on Tuesday. “We’re still in the process of moving peopleoff rigs and platforms but hope to complete that by nightfall. Wewill work into night if we have to.”

If anything good came out of the industry’s experience withEarl, it was the realization of the tremendous speed and efficiencyof Gulf producers. “Overall this was one of the smoothest hurricaneevacs that’s ever been done. That’s what our customers are tellingus,” said Ken Townsend, general manager of the oil and gas divisionof Petroleum Helicopters International Inc. (PHI), the Gulf’slargest helicopter service. “Everyone felt it was a smoothoperation, a safe operation. It was just very well planned out. Theindustry has gotten better over the years. They really have. Theydon’t wait until the last minute. They start moving nonessentialpeople out way ahead of the storm. This one didn’t give them thelead time they usually get but they handled it well.” Townsend saidPHI made about 4,500 flights over a three day period from Tuesdaythrough Thursday, which was about 25% more than normal.

Chevron, which has its own helicopter and ship fleets, evacuatedall 1,600 Gulf employees from over 200 manned structures in theGulf. “With both evacuation and redeployment, we’ve had a lot ofexperience. We do know how to do it. It’s a pretty efficientoperation. It has to be because it’s a tremendous expense bothways,” said spokesman Brent Wood. Chevron shut in about 80% of itsoffshore production, which averages about 1 Bcf/d of gas and104,000 b/d of oil. Shell said it had evacuated 1,350 employeesfrom the shelf and deepwater structures and shut in 1.42 Bcf/d ofgas and 225,000 barrels of oil.

The MMS reported 361 platforms and 69 rigs were evacuated,10.029 Bcf/d of gas was curtailed and 813,843 b/d of oil was shutin. On Wednesday, there was 675 MMcf/d of gas curtailed on ColumbiaGulf, 600 MMcf/d shut in at ANR’s Eugene Island compressorplatform, 482 MMcf/d curtailed at HIOS, 1.2 Bcf/d off Stingray, 750MMcf/d curtailed on El Paso’s Bluewater system upstream of theTennessee 500 and 800 pipeline legs, 1.9 Bcf/d shut-in upstream ofTranscontinental Gas Pipe Line, 250 MMcf/d curtailed on Sonat, 100MMcf/d on Sea Robin, 900 MMcf/d shut in behind Tetco and 1.1 Bcf/doff the Terrebonne system.

For comparison, Hurricane Andrew in 1992 caused 13 Bcf/d of gasand 750,000 b/d of oil curtailments, which was a complete shutdownof the Gulf at the time. And compared to Andrew, Earl was a breeze.Twenty two platforms were lost and 65 were damaged because ofAndrew. And it took four months for production to return to normal.

Last week, almost as quick as turning on a faucet, gas producersbrought supply back on line Thursday and prices resumed theirdownward spiral. The easterly track of Earl allowed producers andpipelines to begin returning work crews to platforms as early asThursday morning. The market reacted with 10- to 15-cent decreases.

Rocco Canonica

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