Kerr-McGee Resumes Gulf of Mexico Operations Following Hurricane Katrina

Kerr-McGee has completed an initial assessment of its Gulf of Mexico facilities and all of its major operated facilities are intact, with no structural damage from Hurricane Katrina observed. The company has begun returning workers to the gulf to further assess facilities and is restarting production and drilling activities.

"The safety of our workers and care for the environment are top priorities for Kerr-McGee," said Dave Hager, Kerr-McGee chief operating officer. "In anticipation of the hurricane, we evacuated our 110 gulf employees and all of our contractors to ensure their safety and shut in operations to protect the environment. Initial damage assessments indicate that our facilities have come through this severe hurricane in good shape, and we will continue to work to restart our remaining production in the gulf as quickly as it is safe to do so."

In the western gulf, the Kerr-McGee-operated deepwater facilities at Nansen, Boomvang, Gunnison and Red Hawk are operational and production from these and our western shelf facilities is ramping up as pipelines allow. In the eastern gulf, the company is preparing its Neptune facility to restart production as soon as pipelines reopen in this area. Aerial assessment of the Breton Sound and Main Pass areas on the shelf also indicated no major structural damage, and detailed inspection is ongoing.

Kerr-McGee has restarted approximately 55,000 barrels of oil equivalent per day (BOE/d) of its total net gulf production. An additional 35,000 BOE/d is expected to be on production within a week as export pipelines become operational. Restart of remaining production volumes, primarily from the eastern and central gulf will be dependent upon further mechanical assessment and restart of pipelines. Kerr-McGee's net daily production in the Gulf of Mexico averaged approximately 130,000 BOE prior to the hurricane.

The hull of the truss spar for the Constitution and Ticonderoga development was towed back to Gulf Marine Fabricators' yard in Ingleside, Texas, prior to the hurricane and sustained no damage. The Constitution topsides, located at Gulf Island Fabricators' yard in Houma, La., also sustained no damage. Kerr-McGee expects to resume installation activities by the end of the week.


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