Gulf of Mexico Says, 'Hello, Dolly!'

Tropical Storm Dolly has the potential to reach hurricane strength as it charges up the Yucatan Peninsula and across to Texas' Gulf Coast, reports. Dolly is the first storm of the Atlantic hurricane season to present a potential menace to oil and gas production in the Gulf of Mexico.

The storm, which crossed the northern tip of the Yucatan Peninsula on Sunday, is 65 miles east-northeast of Progreso, Mexico as of 7:00 am CDT on July 21. It is traveling at a quick 16 mph, and has maximum-sustained winds of 50 mph.

Dolly is expected to intensify as it crosses the warm open waters of the Gulf, and could easily swell to hurricane strength on Tuesday, July 22. Landfall on the Mexico-Texas border is expected on Wednesday, July 23, with the potential to generate life-threatening flash floods across South Texas and northern Mexico.

Industry response to the storm has been mixed. Shell reported the speedy evacuation of approximately 125 employees in the Gulf region on Sunday, July 20, with an additional 60 planned to be removed on Monday, July 21. However, ExxonMobil has reported that, as of 8:30 CDT on July 21, none of its wells were under any hurricane threat.

As Dolly prepares to sweep across the Gulf Coast, companies could be forced to take further action.