Colonial Pipeline, the major fuel line connecting Houston’s refineries to the East Coast, temporarily shut down some of its network Sunday as Hurricane Ida made landfall in Louisiana.
Ida blasted ashore near Port Fourchon, La., around noon as an "extremely dangerous Category 4 hurricane,” according to the National Weather Service. The hurricane, one of the most powerful to ever hit the U.S. Gulf Coast, threatens the nation’s largest concentration of refineries, petrochemical plants and offshore platforms.
The Colonial Pipeline, which carries nearly 3 million barrels of fuel a day between Texas and New York, on Sunday said it temporarily shut down two lines from Houston to Greensboro, North Carolina, as a precaution ahead of Ida. The Georgia-based company said the rest of its pipeline network from North Carolina to New Jersey is operating normally. The pipeline was the target of a cyber-attack in May, which caused major fuel disruptions and gasoline shortages in the southeast U.S.
“As part of our weather preparedness and response plans, we have procedures in place to ensure the safety, protection and integrity of our pipeline and our assets – including proactively shutting down our lines when necessary,” said Wes Dunbar, Colonial Pipeline's vice president of operations.
Ida temporarily halted pipelines, offshore oil and gas production, refining and petrochemical manufacturing as companies shut down facilities and evacuated employees out of harms way. The shutdowns are not expected to cause any immediate supply issues, because crude and gasoline supplies are 5 percent and 3 percent above the five-year seasonal average, according to the Energy Department.
Patrick De Haan, head of petroleum analysis for GasBuddy, a fuel-tracking website, said it is too early to predict Ida’s impact on gasoline supplies and prices.
“For now, this is still not likely to be a ‘major’ event for gas prices,” De Haan said. “If anything, Houston could see prices falling slightly as refiners in the area could get backed up with gasoline since power may be an issue for the Colonial Pipeline.”
UPDATE: Oil companies evacuate Gulf, curtail production ahead of Ida
Ida has forced oil companies to temporarily shut down nearly 96 percent of crude production and nearly 94 percent of natural gas production in the Gulf of Mexico. More than 1.7 million barrels per day of oil production and nearly 2.1 billion cubic feet per day of natural gas production has been halted in the Gulf, surpassing cuts seen during Hurricane Katrina in 2005, according to the Interior Department. The U.S. Gulf of Mexico produces 1.8 million barrels of oil per day, about 17 percent of the nation’s oil production and is second only to shale production in Texas.
Companies have evacuated offshore workers from 288 production platforms, more than half of the 560 manned platforms in the Gulf of Mexico, according to the Interior Department. Workers have been evacuated from all 11 stationary drilling rigs operating in the Gulf, and companies moved 10 of the 15 mobile drilling rigs away from Ida’s track, the department said Sunday.
BHP, BP, Chevron, Equinor, Exxon Mobil, Murphy Oil said they shut-in production and evacuated their Gulf platforms. Royal Dutch Shell said it shut in production, halted its Auger and Enchilada/Salsa platforms and evacuated crews from its Ursa, Mars, Olympus and Appomattox platforms.
At least nine refineries in Louisiana have reduced production or shut down operations ahead of Ida's arrival, curtailing about 2.3 million barrels per day, or 13 percent of U.S. refinery capacity.
Valero on Sunday said its St. Charles and Meraux refineries were shut down in advance of Hurricane Ida’s landfall. Phillips 66 shut down its Alliance refinery in Belle Chasse, La., and evacuated all employees. The plant has a refining capacity of 255,600 barrels per day.
GULF COAST: Hurricane Ida strikes Louisiana; New Orleans hunkers down
Shell shut down its Norco refinery in Louisiana, which has a refining capacity of 230,600 barrels per day, as well as its Geismar petrochemical plant. Westlake Chemical also shut down its its Geismar and Plaquemine plants ahead of Ida’s arrival.
Chevron said it closed its Fourchon and Empire terminals and pipelines in Louisiana.
The Port of New Orleans, Baton Rouge, Gramercy, and Morgan City in Louisiana and the Port of Pascagoula in Mississippi are closed to inbound traffic Saturday, according to the U.S. Department of Energy.
The Louisiana Offshore Oil Port, the largest privately-owned crude terminal in the United States, said Saturday it has temporarily paused deliveries until storm impacts subside. The LOOP handles 10 to 15 percent of the nation's domestic oil, 10 to 15 percent of the nation's imports of foreign oil, and is connected to about half of the U.S. refining capacity, according to the Port’s website.
Kinder Morgan said it has shut down its International Marine Terminals facility Friday evening due to a mandatory evacuation order for the area. The Houston pipeline operator’s Harvey and Seven Oaks Terminals were shut down Saturday night in advance of the storm.
Several facilities will likely be spared from Ida’s wrath. Citgo and LyondellBasell said they do not expect their respective facilities in Lake Charles, La, to be impacted given the storm’s current forecasted trajectory. Liquefied Natural Gas facilities operated by Cheniere Energy, Cameron LNG, and Freeport LNG said they remain confident they will remain open since they are located west of Ida’s path.
Ida's wind speed will play a major role in how much damage Gulf oil and gas facilities will incur, according to S&P Global Platts Analytics.
If the hurricane comes in with the 120 mph winds, it could disrupt refining and petrochemical operations, Platts Analytics said. Category 4 hurricanes have winds of at least 130 mph.
CenterPoint Energy on Sunday said it is sending more than 200 employees and contractors to Louisiana on Monday, joining crews from at least 22 states, to help local utilities restore power to customers following Hurricane Ida. More than 750,000 people in Louisiana were without power on Sunday.
NOAA’s Climate Prediction Center is forecasting another busier-than-normal Atlantic hurricane season this year, with 13 to 20 named storms.
The 2020 Atlantic hurricane season, the second most active on record, forced offshore oil producers to curtail about 110,000 barrels per day. That’s the most since the 2008 hurricane season, which saw curtailments of nearly 140,000 barrels of oil a day, according to S&P Global Platts.
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