US eyes minor to moderate Texas petchem damage

14 September 2008 21:51  [Source: ICIS news]

WASHINGTON (ICIS news)--US Energy Department officials said on Sunday they expect minor to moderate damage at refineries and petrochemical plants in Texas due to Hurricane Ike, but they emphasised there were no reports of major disruptions to the sector.

 

Kevin Kolevar, Energy Department assistant secretary, told a press conference that “as to refineries in Texas, it is still too early to tell” what the extent of damage might be.

 

However, he said that in Louisiana - where the western part of the state was pummeled by Ike - “five refineries are operating at full capacity, six are ramping back up and four remain shutdown”.

 

“We are working with the energy sector all along the Gulf, and our immediate attention is to energy and power restoration,” Kolevar said.

 

He said that although virtually all US offshore oil and natural gas production in the Gulf of Mexico remains shut-in, “some work crews are returning to offshore facilities in the eastern part of the Gulf where weather has improved”.

 

Kolevar said he could not confirm reports from the Texas chemicals industry that up to 100 petrochemical facilities in the state have sustained some level of damage from Hurricane Ike.

 

“It is just too early to tell,” Kolevar said.  “Reports are coming in even as we speak.”

 

“Given the severity of the storm, though, we expect to see at least minor damage to production facilities,” he said.

 

“No one should be surprised to learn of minor to moderate damage at these facilities,” he said, referring to chemical plants and refineries in Texas.  “But we have no indication right now of any major damage.”

 

“If the damage is minor, the large issue is power restoration” for chemical, refining and other critical production assets in Texas, he said.

 

“We will have 6,000 additional linemen arriving in Houston tomorrow [Monday],” Kolevar said.

 

“The federal government is using every tool at its disposal to aid in the restoration of the energy sector,” Kolevar said. 

 

He reported that federal officials have already released an unspecified amount of crude oil from the Strategic Petroleum Reserve (SPR) to three energy companies, including Marathon and Conoco Phillips.  Those releases, he said, were in response to short-term needs created by Hurricane Gustav of earlier this month.

 

“Right now, we do not appear to have a crude supply issue in the Gulf,” Kolevar said.  “Vessels are lined up waiting to offload.”

 

“There doesn’t seem to be a crude situation right now, but the Energy Department is ready to react as soon as needed.”

 

Kolevar also said that the Colonial Pipeline, which originates in Houston and provides a daily average of 100m gal of gasoline, diesel and other refined products to the US South and Northeast, has restarted its diesel and gasoline lines at reduced rates.

 

He said the Plantation Pipeline, which feeds some 26m gal/day of refined products to several southern states and to Washington, DC, is operating at normal rates.

 

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By: Joe Kamalick
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