Production in the Gulf of Mexico Continues to Stabilize

This past year was marked by a 30-year high in oil imports, due in part to a record-breaking hurricane season. Oil and gas production in the Gulf of Mexico is expected to return to normal this year following the devastation of Hurricane Ivan. Less than ten percent of oil production and five percent of natural gas production remains shut-in, according to the Minerals Management Service, which today released a review and damage assessment from Hurricane Ivan. MMS experts also note that approximately 98 percent of the major oil and gas platforms in the gulf are now producing.

“Although a high level of production has been restored, MMS will continue to monitor the ever changing situation in the Gulf of Mexico,” said MMS Regional Director Chris Oynes.

MMS continues to monitor the progress made by the oil and gas industry in returning to pre-storm levels of operation in the gulf. As of January 31, 2005, approximately 135,756 barrels of oil per day (BOPD) and about 489 million cubic feet of gas per day (MMCFPD) remain shut-in.

MMS estimates that, of the approximately 4,000 structures and 33,000 miles of pipelines in the gulf, 150 platforms and 10,000 miles of pipeline were in the direct path of Hurricane Ivan. This path brought Hurricane Ivan across the shelf and through the waters of the Mississippi River delta, the area most susceptible to underwater mudslides in the gulf.

Hurricane Ivan destroyed seven platforms as indicated in Table 1 and caused significant damage to 24 other platforms, 16 of which remain off production. Of the 16 platforms that remain shut-in, 14 are shelf facilities as indicated in Table 2, and two are deepwater facilities as indicated in Table 3. Any additional damage will be detected with underwater surveys required by the MMS Notices to Lessees (NTL 2004-G18 and NTL 2004-G19). With industry still conducting underwater structural damage assessments, the number of platforms with significant damage could still increase. However, updated projections tentatively have all remaining deep water facilities being back online by April 2005. (See Table 3)

Numerous pipelines have been identified that were damaged because of Hurricane Ivan. Thirteen pipelines that were damaged because of mudslides remain shut-in (See Table 4), and there were an additional four pipelines with a diameter longer than 10 inches that were damaged by other forces, all of which remain off production. (See Table 5)

MMS is also going to conduct engineering studies to examine the precise structural forces that were experienced by the platforms during the hurricane. MMS received $500,000 from Congress to contract out technical studies of the impact of Hurricane Ivan. Competitive award proposals for these studies are being prepared.

Table 1 – Platforms Destroyed by Hurricane Ivam

Operator

Map

Area

Block

Number

Facility

Type of Facility

Water Depth(feet)

Taylor

MC

20

A

8-pile

479

Forest

MP

98

A

Braced Caisson

79

El Paso

MP

293

“Sonat”

4-pile

232

Noble Energy, Inc.

MP

293

A

8-pile

247

Noble Energy, Inc.

MP

305

C

8-pile

244

Noble Energy, Inc.

MP

306

E

8-pile

255

Chevron USA, Inc.

VK

294

A

Braced Caisson

119



Table 2 – Major OCS Shelf Platforms Remaining Shut-in with Significant Damage

Operator

Map Area

Block Number

 

Facility

Type of Facility

Water Depth (feet)

Newfield Exploration Company

MP

138

A

4-Pile

158

Chevron USA Inc.

MP

144

A

4-Pile

207

Shell Offshore, Inc.

MP

252

A

4-Pile

277

Shell Offshore, Inc.

MP

252

B

8-Pile

277

Apache Corporation

MP

290 *

B

8-Pile

289

GOM Shelf LLC

MP

296 *

A

8-Pile

212

Noble Energy, Inc.

MP

305 *

A

8-Pile

180

Noble Energy, Inc.

MP

305 *

B

8-Pile

241

Noble Energy, Inc.

MP

306 *

D

8-Pile

255

Noble Energy, Inc.

MP

306 *

F

4-Pile

271

GOM Shelf LLC

MP

296 *

B

8-Pile

225

Apache Corporation

SP

62 *

A

8-Pile

340

Apache Corporation

SP

62 *

C

8-Pile

325

Chevron U.S.A. Inc.

VK

900 *

A

8-Pile

340



* Indicates underwater structural damage on platform as a result of Hurricane Ivan.

A major platform is defined as a structure with either six or more completed wells or zero to five completed wells with more than one item of production process equipment regardless of the amount of production.

Significant damage is defined as damage that prohibits production or requires complete structural analysis of the platform before returning to production

Table 3 – Deepwater Facilities Remaining Shut-in with Significant Damage

Operator

Facility

Map

Area

Block

Number

Type of Damage

Pre-storm

Prod.

Oil (BBLS/D)

Pre-storm

Prod.

Gas(MMCF/D)

Expected Back Online (Tentative)

Chevron

Petronius

VK

786

Topside Module

42,231

64.5

First Quarter 2005

Total E&P

Virgo

VK

823

Topside Equipment

560

22

April, 2005



Since the October 8 th MMS press release, three deep water facilities were removed from the significant damage list because they have been repaired and are currently online. The platforms were: Dominion’s MC 773, Murphy’s MC 582, and Shell's VK 956.

Table 4 – Pipelines Damaged Because of Mudslides that Remain Shut-in

Operator

Area

Block

(Starting Point)

Diameter

(inches)

Product

Tennessee Gas Pipeline Co.

SP

77

26

Gas

Gulfterra Field Services LLC

VK

817

20

Gas

Southern Natural Gas Company

MP

151

18

Gas

Williams Field Services Company

MC

20

12

Gas

 Taylor Energy Company

MC

21

10

Bulk Oil

Chevron Pipeline Company

SP

49

10

Gas/Oil

 Taylor Energy Company

MC

21

08

Bulk Oil

 Taylor Energy Company

MC

21

08

Bulk Gas

Taylor Energy Company

MC

20

06

Oil

 Taylor Energy Company

MC

20

04

Gas

Mariner Energy Inc.

MC

66

03

Bulk Gas

Walter Oil & Gas

MC

68

06

Bulk Gas

Walter Oil & Gas

MC

243

10

Gas



Table 5– Damaged Large Diameter Pipelines (10" or longer)
Not Related to Mudslides that Remain Shut-in (In Federal Waters Only)

Operator

Area

Block

(Starting Point)

Diameter (Inches)

Product

Southern Natural Gas Company

MP

289

24

Gas

Southern Natural Gas Company

MP

293

24

Gas

Southern Natural Gas Company

MP

306

18

Gas

Tennessee Gas Pipeline Company

ST

55

12

Gas

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