September 6, 2006
Gulf oil and gas production starts to pick up
The vast majority of U.S. Gulf offshore oil and gas facilities "could be ready to come back on line in days and weeks, rather than months." That was the assessment of Assistant Secretary for Land and Minerals Management Rebecca Watson in testimony today before the Senate Energy and Natural Resources Committee regarding the status of offshore oil and natural gas production in the Gulf of Mexico.
"Our focus now is to ensure that the offshore oil and gas operations are brought on-line safely and as soon as possible," said Watson.
Oil and gas production in the Gulf of Mexico supplies 29 percent of domestic oil production and 21 percent of domestic gas production. On August 30, 2005, 95 percent of daily oil production and 88 percent of daily gas production was shut in for environmental and human safety. Today, those numbers stand at 58 percent of oil production and 42 percent of natural gas production.
"A full assessment of the damage from Hurricane Katrina will require several more days," cautioned Watson. "Many facilities have still not been inspected by their operators. It is important to note that there have been no reports of significant spills related to production. All safety systems worked to successfully shut-in production on the OCS platforms."
Of the roughly 4,000 Outer Continental Shelf production facilities, 37 shallow water platforms were destroyed; however, they only produced about one percent of total Gulf production. Four large deep water platforms accounting for about 10 percent of the pre-storm federal offshore Gulf oil production suffered extensive damage which could take up to 3--6 months to bring back on line. Some pipelines suffered damage that could take months to repair, while others have been inspected, tested, and have already commenced operations.
"Despite this damage, about 90 percent of Gulf oil production could return to the market in one month, if refineries, processing plants, pipelines and other onshore infrastructure are in operation to receive, prepare and transport it to the consumer," said Watson.