U.S. Gulf oil producers curtail output ahead of Tropical Storm Nate

HOUSTON (Reuters) – Oil and natural gas operators began evacuating staff and halting production at U.S. Gulf of Mexico platforms on Thursday ahead of Tropical Storm Nate, the second storm in as many months to rattle the Gulf Coast energy corridor.

Nate, which has killed at least 10 people in Costa Rica and Nicaragua and caused intense rainfall, is forecast to scrape Honduras and Mexico, enter the Gulf and strengthen into a hurricane before making landfall this weekend in Louisiana, near several major refineries.

That path takes it through an area populated by offshore oil and natural gas platforms, which pump more than 1.6 million barrels of crude per day (bpd), about 17 percent of U.S. output, according to government data.

About 14.6 percent of U.S. Gulf oil production equaling 254,607 bpd was offline on Thursday, the U.S. Department of the Interior’s Bureau of Safety and Environmental Enforcement (BSEE) said. About 6.4 percent of natural gas output in the area also was shut.

Forecasts for Nate have shifted westward in the past 24 hours. The National Hurricane Center (NHC) had forecast on Wednesday that the storm would make landfall in the Florida panhandle.

BP Plc and Chevron Corp were shutting production at all Gulf platforms, while Royal Dutch Shell Plc and Anadarko Petroleum Corp suspended some production and some drilling activity in the Gulf.

Exxon Mobil Corp, Statoil and other producers have withdrawn personnel from their platforms.

Marathon Oil Corp and ConocoPhillips said they were monitoring Nate’s path but have taken no action yet.

Nate, the 14th named storm of the Atlantic hurricane season, comes less than two months after Hurricane Harvey tore through the Gulf, denting about a quarter of oil production there, according to government data.

Several Texas ports are still unable to allow large tankers to enter after Harvey as they await dredging. Some large tankers have been rerouted to Louisiana ports, some of which are now in Nate’s projected path.

The Louisiana Offshore Oil Port (LOOP), an offshore gathering hub for production platforms and crude imports from tankers, has not suspended operations and vessel activity around it continues as normal, officials said on Thursday.

All Louisiana ports were open as authorities and the U.S. Coast Guard monitored the storm, according to the Port Association of Louisiana.


Refiners in Louisiana also have been scrambling ahead of Nate.

Shell was reducing production on Thursday at its 225,800-bpd Norco refinery and Phillips 66 was considering temporarily shutting the 247,000-bpd Alliance refinery or placing it on standby, according to sources.

At least three other refineries were preparing to continue operation through Nate, sources familiar with plant operations said. PBF Energy Inc’s Chalmette, Louisiana, refinery planned to remain in operation, sources said.

PBF declined to discuss operations at the Chalmette refinery. Shell spokesman Ray Fisher said officials at its refining and chemical plants were monitoring the storm.

Chevron said its Pascagoula, Mississippi, refinery was monitoring the storm’s progress. Exxon said the same about its refinery and chemical plant in Baton Rouge, Louisiana.

Marathon Petroleum Corp declined to discuss operations at the company’s Garyville, Louisiana, refinery.

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