Frequent hurricane shutdowns weigh on U.S. energy results

In this news, we discuss the Frequent hurricane shutdowns weigh on U.S. energy results.

(Reuters) – As crews began returning to U.S. offshore facilities in the Gulf of Mexico on Thursday, repeated shutdowns in oil and gas production this year have already affected the results of energy companies.

Eight named storms entered the Gulf of Mexico in the United States this year, most of which turned into damaging storms that required evacuations of offshore facilities or temporary well closures.

“It has been a tough and difficult year due to the number of storms,” said Erik Milito, president of the National Ocean Industries Association business group. US oil production off the Gulf of Mexico will likely end the year down about 200,000 barrels per day (b / d) from where it started, he said.

Hurricane Zeta this week slashed 4 million barrels in four days, interrupting up to 85% of daily oil production off the Gulf of Mexico and nearly 58% of its natural gas production. She and other storms have led to the closure of pipelines and onshore processing facilities, even damaging wells that could remain open.

Weak energy prices pushed U.S. output in the Gulf of Mexico down in July to 1.65 million bpd, ahead of the series of storm-related shutdowns. He could recover some of the lost production in the coming weeks, NOIA’s Milito said.

The well closures will affect the results of Hess Corp HES.N, which forecasts a decline of 25,000 b / d in the current quarter, in addition to a loss of about 19,000 b / d in the previous quarter on the offshore maintenance and hurricane closures.

W&T Offshore WTI.N earlier predicted that fourth-quarter oil and gas production would fall below analysts’ expectations, even though its rigs did not suffer major damage from repeated storms. The closures have also added about $ 5 million to its costs.

In addition to the shutdowns of two rigs, Royal Dutch Shell RDSa.L said on Thursday that other productions in the Gulf of Mexico had been affected by disruptions away from its rigs. It was also restarting an onshore crude oil processing unit that had been shut down by power outages caused by the storm.

Reporting by Erwin Seba and Gary McWilliams; Edited by David Gregorio

Original © Thomson Reuters

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