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Discovery Offshore Gathering System Mainline Returns to Service

The 30-inch diameter mainline of the Discovery offshore gathering system in the Gulf of Mexico (GOM), which was heavily damaged by Hurricane Ike in September, has been repaired and is back in service, Williams Partners LP said last Wednesday.

The mainline is delivering 150 MMcf/d, which was its approximate volume prior to the hurricane, according to Williams.

The Discovery system, which is operated by Williams and jointly owned by Williams (60%) and DCP Midstream Partners LP (40%), sustained storm damage when Ike hit in mid-September and the system had not been accepting gas from offshore producers while repairs were being made. During the storm an 18-inch diameter lateral was severed from its connection to the mainline in 250 feet of water. The damaged lateral remains off-line while repairs are being made, shutting in approximately 30 MMcf/d of production. The lateral is expected to be repaired and placed back into service by mid-February, Williams said.

Discovery includes an offshore natural gas gathering system, the Larose processing plant and Paradis fractionation facility. Neither onshore facility was seriously damaged. Both have been processing gas from third-party sources since September.

In October Tulsa, OK-based Williams said it expected a reduction in its midstream's segment profit of $10-20 million for the fourth quarter of 2008 due to hurricane damages and downtime (see NGI, Oct. 20, 2008). Last week Williams said that guidance "is unchanged." Williams' 4Q2008 earnings release is scheduled for Feb. 19.

Last month DCP said it had no plans to lower its payout, despite the lingering effects of hurricane damage to Discovery and an ongoing integrity project at its Douglas pipeline in Wyoming (see NGI, Dec. 15, 2008). DCP is scheduled to release fourth quarter and year-end 2008 results on Feb. 25.

According to the latest information from the Minerals Management Service, 1,108 MMcf/d of GOM gas production remain shut in due to the impacts of hurricanes Gustav and Ike. GOM natural gas production prior to the hurricanes was estimated to be 7 Bcf/d. Since then production from the Independence Hub has increased and current production from the GOM is estimated at 7.4 Bcf/d, MMS said. MMS said 60 oil and gas production platforms were destroyed by Gustav and Ike. In an assessment released in November, MMS said 31 GOM platforms which received extensive damage, including underwater structural damage or major damage to pipelines, would take 3-6 months to repair.

In late December Enterprise Products Partners LP said repairs had been completed to its High Island Offshore System (HIOS) and the company had been given permission to resume full service on HIOS (see NGI, Jan. 5). The 42-inch diameter segment of the HIOS system -- which transports gas from fields in the western Gulf of Mexico -- was severed approximately 130 feet under water during Ike. During repairs gas volumes into the system had been limited to certain receipt points upstream of the break and required third-party pipeline systems for delivery to onshore facilities. The pipeline has the capacity to transport up to 1.8 Bcf/d.

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