Gulf of Mexico producers and pipeline companies continued to make progress Tuesday repairing infrastructure damaged by Hurricane Ivan. The Minerals Management Service (MMS) said 22 companies reported that nine manned platforms and two rigs were still evacuated and 1,735.8 MMcf/d of gas and 453,092 bbl/d of oil were still shut in. Cumulative production shut-ins now stand at 67.861 Bcf of gas and 15.3 million bbl of oil.
Also on Tuesday, BP delayed the full return of its Gulf of Mexico oil and natural gas output until the end of October because of ongoing pipeline repairs. BP’s Gulf production is currently 150,000 boe/d compared to a normal level of 350,000 boe/d, a spokeswoman said.
Energy consulting firm PIRA Energy Group said it expects up to 110 Bcf of gas production will have been deferred because of damage from Hurricane Ivan when all the repairs are finally completed in November. PIRA estimates that at least 40 million boe of oil and gas will be deferred, including 17 million bbl of oil and four million barrels of natural gas liquids.
However, producers have made significant progress since last week, when 2.3 Bcf/d of gas was shut in and 39 platforms were still evacuated. Meanwhile, the market is indicating that the need for gas currently is quite low because of mild shoulder month temperatures, particularly in the Southeast. Southern Natural reported on Tuesday that despite significant shut-ins remaining upstream of its system, it still has more gas in the pipeline than its market areas need.
Southern Natural even warned shippers Tuesday that it may have to call an operational flow order for Thursday’s gas day because it is receiving more gas into the system than it has the capacity to handle west of the Bienville Compressor Station in North Louisiana. The situation is threatening the operational integrity of the pipeline.
Southern Natural reported no changes on its system upstream of the Toca Compressor Station, where Ivan wreaked the most havoc to platforms and pipeline facilities. Prior to Ivan, Southern was receiving about 800-850 MMcf/d from 70 points upstream of Toca. To date, field personnel have verified the integrity of the facilities associated with receipts from 43 of those points. The 43 points had been flowing 500 MMcf/d prior to Ivan, but currently they are flowing about 369 MMcf/d. Meanwhile, the 27 other points, representing about 350 MMcf/d, remain shut in. Southern expects that it will take another two weeks to complete damage assessments in the area.
Williams, which owns Transcontinental Gas PipeLine and half of Gulfstream Natural Gas, said Tuesday it expects to take up to a $20 million pre-tax charge against earnings because of lost revenues and uninsured damages associated with Hurricane Ivan. Underwater inspections at its facilities in the eastern Gulf are expected to conclude this week. The company’s primary operations in the Gulf have returned to service, with the exception of the Devils Tower platform, a deepwater spar at Mississippi Canyon Block 773, about 150 miles south of Mobile, AL. The Devils Tower facility is scheduled to return to service in late October to mid-November, following repairs to the topsides over the next several weeks.
Dominion, which owns 75% of Devils Tower production and is the operator of the platform, said Tuesday that until production resumes, it has a comprehensive insurance program to reimburse for delayed production beyond an estimated $9 million after-tax loss of income.
Production from three Devils Tower wells was interrupted on Sept. 15 by Ivan. A fourth well near completion at the time of the hurricane also is expected to begin production between late October and mid-November. A new completion rig needed to bring the facility’s four wells into production is expected to be available for installation in about 90 to 120 days. Prior to the hurricane, Devils Tower was producing 20,000 bbl/d of oil and 16 MMcf/d of gas.
Canyon Station, owned and operated by Williams, is a fixed-leg platform in 300 feet of water in East Main Pass Block 261 in Mobile Bay. The facility returned to service Oct. 1 after being offline for 19 days. The platform sustained minor damage during the storm, Williams said.
Onshore, Williams’ gas processing plant in Mobile survived the storm without incident and returned to service Friday, Sept. 24 after being offline for 10 days. The plant is processing 340-365 MMcf/d of gas, which represents more than half of the facility’s 650 MMcf/d capacity. The plant’s level of utilization will be negatively impacted until its customers are able to resume offshore production, the company noted.
Â©Copyright 2004 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.
© 2021 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |