Oil firms evacuate rigs ahead of Hurricane Dolly

Martyn Wingrove - Wednesday 23 July 2008

Cars leaving Padre Island as Dolly approaches the South Texas coast. pic: AP Cars leaving Padre Island as Dolly approaches the South Texas coast. pic: AP
OIL companies in the Gulf of Mexico have evacuated several production platforms and drilling rigs in preparation for Hurricane Dolly, reducing the region’s hydrocarbon output.

Companies including Shell have evacuated almost 50 platforms and at least six rigs in the region to ensure their workers are not at risk from the first of this season’s hurricanes to reach the Gulf of Mexico’s oil industry.

The US Minerals Management Service said 49 Gulf of Mexico platforms have been shut down, cutting oil production by around 61,000 barrels per day and gas output by some 400m cu ft per day. These volumes will need to be replaced by imports by ship or pipeline.

Shell has shut down much of its development activity on the Perdido deepwater oil project as this is close to the hurricane’s path and evacuated more than 200 offshore workers.

Weather watchers think Hurricane Dolly has missed most of the oil and gas installations off the southern US coast, but predict it will go near those at the far southwest of oil patch, meaning these have been evacuated.

Catastrophe risk modellers at Air Worldwide predict the storm will hit landfall close to the Texas, Mexico border, an area of around 2m people and coastal fabrication yards and refineries. They fear this could cause flooding and damage to commercial properties.

“Insured losses to offshore platforms will likely be driven by business interuption due to pre-storm evacuations,” said Air Worldwide’s director of atmospheric science Peter Dailey.

Oil prices have fallen this week to around $126 per barrel from $131 reported on Monday as fears of the hurricane causing huge damage to the US oil industry eased and the dollar strengthened.

 

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