Daily status report on energy industry recovery efforts in the US Gulf

 

-- Apache Corp on Sep 15 said damage to production infrastructure in the Gulf of Mexico will likely keep 60,000 Mcf/d of its gross operated natural gas production and 20,000 b/d of its oil output offline for up to a year. Apache has restored 81% of its gross operated Gulf gas production, or some 459,000 Mcf/d, and 65% of its oil output, or 45,600 b/d. Another 45,000 Mcf/d and 4,000 b/d is expected to return by mid-October.

-- OPEC has reaffirmed that members were ready to raise crude supplies if required, such as to make up for lost production due to Katrina. "OPEC member-countries will be discussing further proposals to ensure the market is well-supplied over the coming months, including consideration of increasing its production to cover any shortage," the group said.

-- Delta and Northwest Airlines, the world's third and fourth-largest carriers, have both filed for bankruptcy protection, the latest victims of massive losses brought on by the doubling of jet fuel costs over the past two years. They join United Airlines and US Airways in seeking protection from creditors in Bankruptcy Court.

-- Royal Dutch/Shell said its net Gulf of Mexico production has returned to about 160,000 boe/d in the aftermath of Katrina. The company's first-half production from the region was 450,000 boe/d. Shell said it expects that about 60% of the total production will be restored to pre-hurricane levels "within fourth quarter 2005."

-- Despite the fact some 56% of the oil production in the Gulf of Mexico remains idled more than two weeks after Katrina roared through the region, the six refiners awarded loans from the US Strategic Petroleum Reserve to help ease crude supply shortages have taken delivery of just 2.405-mil bbl of the 12.6-mil bbl awarded, information from the companies and the Department of Energy showed on Sep 14.

-- The US Department of Energy said it expects to take in $702-mil on the 11-mil bbl of crude it sold from the SPR in a process that was separate from the loan awards. The DOE made 30-mil bbl of SPR crude available in the sale, but received bids on only 19.2-mil bbl and accepted just 11-mil bbl in bids.

-- Contract driller GlobalSantaFe said Wednesday it expects to see some impact to its second-half 2005 financial results stemming from damage or downtime wreaked by Hurricane Katrina to four Gulf of Mexico semisubmersible rigs. But GSF said it did not know how much the financial impact would be on the rigs, which included the Arctic I, Celtic Sea, Development Driller I and Development Driller II.

-- Growing uncertainty over the post-storm return of Chevron Pipeline's damaged terminal in Empire, Louisiana, which handles domestically traded Heavy Louisiana Sweet (HLS) crude, has led several HLS producers and traders to discuss moving the HLS delivery point to another location, according to sources close to the discussions.

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