Stone Energy Loses Three Platforms to Hurricane Rita
Stone Energy reports that due to Hurricane Rita, all offshore drilling and production activities in the Gulf of Mexico were suspended as of Thursday, September 22, 2005. Stone safely evacuated all employee and contract personnel prior to the arrival of the storm. Net daily production of approximately 195 million cubic feet of natural gas equivalent (MMcfe) (down from pre-Hurricane Katrina volumes of 260 MMcfe per day) was shut in as a result of Hurricane Rita.
Stone conducted an initial flyover of its properties after the hurricane, which indicated that the South Marsh Island 108 D platform and Vermilion Block 255 A and B platforms have been lost. Stone operates a total of 115 structures in the Gulf of Mexico. The net volumes from these platforms were approximately 18 MMcfe per day. Stone is evaluating alternatives for the lost platforms including utilizing existing platforms. Stone is currently assessing other operated platform damage, although it may be several days before information is received on properties and pipelines operated by third parties. Stone's properties and facilities are insured after a minimal deductible; however, Stone does not maintain coverage for business interruption.
Plans have been made to return personnel to unaffected properties representing approximately 75 to 100 MMcfe per day. These volumes are expected back on line within the next week, subject to the availability of pipeline and plant facilities. Stone's production of 20 to 25 MMcfe per day from Rockies gas and Williston oil remains unaffected. Stone intends to provide additional information and guidance as the impact from Hurricane Rita and Hurricane Katrina is further quantified.
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