UPDATE: More US Gulf Oil, Gas Production Being Shut In Due To Alex

30th Jun 2010 01:43

(Update to add official statistics on oil, gas production shut-in due to storm) By Isabel Ordonez Of DOW JONES NEWSWIRES HOUSTON (Dow Jones)--Oil and gas producers in the U.S. Gulf of Mexico proceeded to shut in several offshore facilities Tuesday as Tropical Storm Alex, expected to become a hurricane later in the day, headed towards the Mexico-Texas border. The storm could make landfall late Wednesday. The U.S. Minerals Management Service, the Department of the Interior agency that supervises offshore drilling in federal waters and recently changed its name to Bureau of Ocean Energy Management, Regulation and Enforcement, said late Tuesday that about 24.74% of oil production and about 9.38% of natural gas production in the Gulf of Mexico has been shut-in due to the storm. Estimated energy production from the Gulf of Mexico as of March 2010 is 1.6 million barrels of oil per day and 6.4 billion cubic feet of gas per day, the Bureau said in a press release. The agency, currently undergoing an overhaul amid oil spill response efforts in the wake of the Deepwater Horizon explosion in the Gulf of Mexico, said neither the drilling rigs nor the containment vessels involved in the oil spill response have been required to evacuate or halt operations. Royal Dutch Shell (RDSA), BP PLC (BP, BP.LN), Chevron Corp. (CVX), Apache Corp. (APA), Exxon Mobil Corp. (XOM) and ConocoPhillips (COP) said Tuesday they have shut in production from their western and central Gulf assets to protect their workers from bad weather. The growing shut-in Gulf production had little impact on the energy markets, but interruptions in output "will become more important as hurricane season progresses," Dan Pickering, co-president of Houston investment firm Tudor, Pickering, Holt & Co., wrote in an email. Light, sweet crude for August delivery settled $2.31, or 3%, lower. at $75.94 a barrel on the New York Mercantile Exchange. Crude-oil futures fell to a two-week low in a rout across many commodities and equities markets as fears of a slowdown in global growth hit prospects for increased oil demand. Natural gas for August delivery on the New York Mercantile Exchange settled 18.5 cents, or 3.91%, lower at $4.548 a million British thermal units after reaching a low of $4.525/MMBtu earlier in the day. Houston-based Apache said that about 5,500 barrels of oil a day and 40 million cubic feet of natural gas are off line as of Tuesday afternoon. Exxon Mobil said gross production of about 8,000 barrels of oil a day and 123 million cubic feet of natural gas are off line as of early Tuesday. ConocoPhillips said on its website that production of about 10,000 barrels of oil equivalent per day has been shut in. BP shut in production at its Atlantis, Mad Dog and Holstein platforms Monday. The company said it's bringing workers back to the platforms and that it expects to restore output as soon as practically possible. The high seas caused by Alex also forced the Louisiana Offshore Oil Port to close Tuesday evening. Spokeswoman Barb Hestermann said the port's closure won't affect deliveries to refineries as onshore inventories will be used until the port resumes operations. -By Isabel Ordonez, Dow Jones Newswires; 713.547.9207; [email protected] (END) Dow Jones Newswires June 29, 2010 20:43 ET (00:43 GMT)