Offshore natural gas producers in the Gulf of Mexico that rely on the Destin Pipeline to transport supplies to the U.S. onshore were looking for alternative routes following an explosion that shuttered Enterprise Products Partners LP’s Pascagoula gas processing plant in Mississippi.

An investigation is underway at the 1.5 Bcf/d capacity straddle plant after an explosion and fire shortly before midnight Monday rocked the facility (see Daily GPI, June 28). About 400 MMcf/d was shuttered at the Pascagoula Gas Processing Plant (PGP), according to Enterprise. The explosion may have been caused by a propane explosion, which heavily damaged the facility, according to an unconfirmed report. One source told NGI the plant could be closed for weeks.

Genscape Inc. estimated that nominations as of the evening cycle for Wednesday were at zero for key offshore production locations in Mississippi Canyon, including Murphy Oil Corp.’s Thunder Hawk; BP plc’s Horn Mountain, Nakika, Thunder Horse, and Viosca Knoll platforms; and LLOC Exploration Co. LLC’s Delta House. BP had owned and operated PGP until June 1.

“In the seven days prior to the explosion, raw gas production on Destin averaged 575 MMcf/d,” Genscape noted. “Factoring in the average shrink of 133 MMcf/d from the Pascagoula plant over the same period, approximately 432 MMcf/d of dry gas is unable to reach onshore interconnects.” Florida Gas Transmission (FGT) “appears to be taking the brunt of the impact as deliveries onto FGT are currently 273 MMcf/d below their seven-day average.”

PGP advised Destin early Wednesday that it continued to be unable to process gas. In a bulletin board posting on Wednesday, Destin said PGP has not indicated when it’s expected the plant will be able to resume gas processing services, and “Destin continues to be unable to provide gas transportation service from all of its offshore receipt points to the PGP.”

Also impacted is the Discovery pipeline, according to EnergyGPS. In a Wednesday note to clients, the consultant said the loss of Destin and Discovery production “will combine to leave the grid 0.846 Bcf shorter on the day” versus Monday and 0.997 Bcf shorter compared to Sunday (see related story).

Destin initiated “normal procedures” to provide shippers access to the Viosca Knoll Gathering System (VKGS), and pending “successful testing of meters and cooperating weather,” flows were expected to begin around 6 p.m. Wednesday. Destin noted that the meter testing was dependent on personnel arriving at Main Pass (MP) 260 and MP 261 to complete necessary work required to reverse flow.

“Total gas flows from MP 260 into VKGS will be limited by meter capacity to 350 MMcf/d,” Destin advised. “Once service to VKGS is established, there will be a pipeline constraint caused by the fact that during flows to VKGS, retrograde condensate liquids cannot be delivered to the VKGS and are accumulated in Destin 36-inch main line.” When Destin is delivering to VKGS and the incremental volume of retrograde condensate bbls injected into the Destin 36-inch diameter pipeline reaches 8,000 bbl, the VKGS delivery service option is to be shut down and discontinued.

Destin expects the VKGS service would be available for two to five days before reaching the 8,000 bbl limit, but “the timeframe is uncertain and highly dependent on flows and liquid drop out.” Destin’s onshore gas transportation service was not impacted and normal operations continue.

The Destin shut-in was expected to curtail GOM production in the short-term. “Our GOM sample production plummeted 599 MMcf” between Monday and Tuesday, while the evening cycle nominations for Wednesday appeared to indicate production would “hold relatively steady. The previous dip in GOM production during the first week of June was attributed to offshore platform maintenance; this included, production declines on Discovery GT (related to Lucius platform maintenance) and Destin (related to maintenance at the Delta House platform),” Genscape said.

A force majeure event occurred three years ago at the Pascagoula Plant, and at that time, no other offshore pipes appeared to pick up the shut in gas from Destin, Genscape said. However, analysts noted changes on GOM pipelines Monday and Tuesday.

Notable day/day changes by pipe included Dauphin Island production (plus 7.8 MMcf/d); Kinetica Partners (plus 11.4 MMcf/d); Stingray (16 MMcf/d ); High Island Offshore System (minus 6.4 MMcf/d); Mississippi Canyon (minus 4.7 MMcf/d); and Discovery (minus 163.3 MMcf/d).