Posted by: mrpeatie | August 30, 2008

The Other Big Concern With Gustav

As Hurricane Gustav bears down on the Louisiana and Texas coastlines, the biggest concern is off course the danger to the people and property of the region. The other big concern is to the impact Gustav will have on the oil and gas industry.

Like most people, I’ve always known there were numerous oil and gas drilling platforms in the Gulf of Mexico. I’ve never knew how many or where exactly they all were.  How many drilling platforms do you think there are? 50? 100? 1000? There are nearly 4,000 active oil and gas platforms in the Gulf of Mexico. A vast majority are concentrated along the Texas/Louisiana coastline.

Gustav’s current forecast track has it tearing through this region early next week as a major hurricane. In 2005, hurricanes Katrina and Rita followed similar paths causing significant damage to the platforms and refineries in the area. It took years to fully recover. If Gustav remains on its current track we could see similar damage, and ultimately, increased prices at the pump. So fill up on gas this weekend.

More specific information from Bloomberg.com:

Shell and BP aimed to complete the shutdown of the equivalent of 800,000 barrels a day of oil production today.  Oil producers have shut at least 6.6 percent of output in the Gulf of Mexico. Shell plans to halt 510,000 barrels a day and BP said it will stop about 290,000 barrels.

Fields in the Gulf produce 1.3 million barrels a day of oil, about a quarter of U.S. production, and 7.4 billion cubic feet a day of natural gas, 14 percent of the total, government data show. Hurricane Katrina in 2005 closed 95 percent of regional offshore output and, along with Hurricane Rita, idled about 19 percent of U.S. refining capacity.

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