Hurricanes

Despite the havoc wreaked by the twin Gulf of Mexico hurricanes and the upheaval in the credit markets, third-quarter oil and natural gas production oupaced year-ago levels and second-quarter activity, the American Petroleum Institute (API) reported Friday.

As of about noon CDT Friday 44.6% of the Gulf of Mexico (GOM) natural gas production was shut in out of normal production of 7.4 Bcf/d, and 48.2% of oil production was shut in out of normal production of 1.3 million b/d, following the ravages of hurricanes Gustav and Ike in late August and mid-September, the Minerals Management Service (MMS) said.

As of about noon CDT Friday 44.6% of the Gulf of Mexico (GOM) natural gas production was shut in out of normal production of 7.4 Bcf/d, and 48.2% of oil production was shut in out of normal production of 1.3 million b/d, following the ravages of hurricanes Gustav and Ike, the Minerals Management Service (MMS) said.

Radnor, PA-based producer Penn Virginia Corp. cut its full-year 2008 oil and gas production guidance to 46.5-48 Bcfe from previous guidance of 49.7-51.7 Bcfe in part due to hurricanes Gustav and Ike, the company said Thursday.

For the first time since hurricanes Gustav and Ike swept through the Gulf of Mexico (GOM), the Minerals Management Service (MMS) Monday reported that natural gas and oil production restoration passed the halfway mark.

Another producer that operates in the Gulf of Mexico (GOM) said Thursday that hurricanes Gustav and Ike cut into its projected 2008 oil and natural gas production forecasts. Meanwhile, the Minerals Management Service (MMS) reported that 56.4% of the GOM’s usual gas output of 7.4 Bcf/d still was shut in, which is a gain of less than 1% in 24 hours.

The cash market decided to ignore the slow pace of offshore production recovery from the one-two punch of hurricanes Gustav and Ike and instead focused on the overall lack of weather-based demand for those missing supplies Friday. Abetted by the previous day’s 28.9-cent decline in October futures and the weekend dropoff of industrial load, the weakness of weather fundamentals drove all but a few Texas points lower. Just as there were quite a few triple-digit increases on Thursday, several points saw drops of about a dollar or more Friday.

Threats to the Gulf Coast — hurricanes and coastal erosion among them — have inspired energy industry leaders, environmentalists and conservationists to launch a sustainability initiative to protect the region, which is an energy breadbasket for the nation.

Threats to the Gulf Coast — hurricanes and coastal erosion among them — have inspired energy industry leaders, environmentalists and conservationists to launch a sustainability initiative to protect the region, which is an energy breadbasket for the nation.