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2008-09-17 Home Front Economy

Ike damaged about 10 oil platforms out of 3,800 in the region

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Posted by 3dc 2008-09-17 00:00|| || Front Page|| [2 views ] Top

#1 Ack! We're all gonna die!

Posted by gorb 2008-09-17 04:18|| 2008-09-17 04:18|| Front Page Top

#2 That must have been the East Tennessee Ten that got damaged. that would explain why the price of gas went up here about $1.50 /gal the day before Ike made landfall.

Posted by BrerRabbit 2008-09-17 11:45|| 2008-09-17 11:45|| Front Page Top

#3 Ike destroyed about 28 platforms - 10 of our company alone. But they were all older facilities with fairly modest production - perhaps 1000 barrels per day per platform, average. It is likely this production is permanently lost however, because the total reserves still potentially recoverable in those reservoirs are not sufficient to pay for expensive new platforms and wells.

Three drilling rigs were destroyed and several others severely damaged.

At least one pipeline was damaged, but many more must be tested before they can be put on production again. Fields off eastern Louisiana mostly had only minor damage and are being restored to production - this oil should start reaching shore in a week or so. It will take longer to assess damage and make repairs to the platforms and pipelines off western Louisiana though.

Posted by Glenmore 2008-09-17 12:18|| 2008-09-17 12:18|| Front Page Top

#4 BrerRabbit,
Check the 'Colonial Pipeline' to understand more about why shortages (and price hikes) were where they were/are. It collects refined products from plants along the Gulf Coast and transports them up through Georgia and the Carolinas, with branches to Chattanooga and Knoxville. Gustav cut power to a number of the pumping stations and just as it was getting back on line Ike took the supplying refineries off (as well as cutting pump power again). I don't know if it is back on line yet (certainly the western part is not, but feed-ins from some Mississippi River plants may be underway.) Combine that with a large surge in demand from evacuating people. Add in the fact that the distributors were drawing down their more expensive summer blend stocks to make room for the winter blends (which were just starting to come in) and you are guaranteed spot shortages. Add in panic buying and you get widespread outages (understand that the total storage volume of refined gasoline in the entire system is less than the empty space in America's vehicle's gas tanks under normal conditions - or so I have been told).
I know of one distributor in East Tennessee who was low but not out and had set their sales price at $4.99. After being threatened with gouging prosecutions they dropped it to $4.49, sold out in hours, and closed down indefinitely. So customers who got the gas are less unhappy, but others who did not can't even get to work now, and people who were on vacation sit stranded - they would have been less unhappy to have paid the $4.99. So it goes. Should shake out in a few more weeks, I believe.

Posted by Glenmore 2008-09-17 12:32|| 2008-09-17 12:32|| Front Page Top

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