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Oil companies try to restore Texas operations after Storm Beryl
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Oil companies try to restore Texas operations after Storm Beryl
Jul 9, 2024 7:47 PM

By Arathy Somasekhar, Georgina McCartney and Laila Kearney

HOUSTON, July 9 (Reuters) - Oil and gas companies in

Texas restarted some operations on Tuesday after Hurricane Beryl

lashed the state with 80-mph (129-kph) winds, while some

facilities sustained damage and power had not been fully

restored.

Beryl's impact on oil and gas production was expected to be

limited. The storm made landfall on Monday near the coastal town

of Matagorda. Energy firms shut operations ahead of its arrival

and Texas' largest ports and navigation channels closed.

Some ports reopened on Tuesday and most producers and

facilities were ramping up output. Some were limited by the slow

restoration of power to homes, businesses and industrial

customers.

Weather forecasting firm AccuWeather issued a preliminary

estimate of $28 billion to $32 billion in total damage and

economic loss from the hurricane in the United States.  

More than 1.8 million customers remained without power in

Texas on late Tuesday, according to PowerOutage.us, including

some 1.4 million served by provider CenterPoint Energy ( CNP ).

The Texas figure was more than double the number of

customers that lost power in May during a weather event in

Houston. It took more than a week for those outages to be

resolved in some city neighborhoods.

CenterPoint said in a statement that it had restored power

to more than 850,000 customers of the total 2.26 million

impacted, and "remains confident in restoring 1 million

customers within 48 hours of storm's exit from area".

"I can't give you a timeline, but it's not going to be

tomorrow," Centerpoint's Local Government Relation Manager Paul

Lock replied to a query on when power would be fully restored.

Texas Lieutenant Governor Dan Patrick urged CenterPoint to

work as quickly as it can to restore power.

"We can do a post-analysis of their success or failures

after we get the power back," Patrick added in response to

questions about whether the power company was prepared in

advance of the hurricane.

Houston was sunny on Tuesday with temperatures in the high

90 degrees Fahrenheit (32.2° degrees Celsius), causing problems

as power outages knocked out air conditioning. Many gasoline

stations in Houston were closed due to lack of power or fuel

stocks.

Beryl lost strength quickly upon making landfall and by

Tuesday was downgraded to a post-tropical cyclone, the U.S.

National Hurricane Center said. It warned that flash flooding

and tornados remained possible from mid-Mississippi to the Lower

Ohio Valley.

TEXAS FLOODING EASING

Texas is the largest U.S. oil and gas producing state,

accounting for some 40% of oil and 20% of gas output, and is

also a major shipping and refining hub. Any weather-related

interruption could affect crude and fuel production levels, as

well as imports and exports.

"Although the hurricane did not cause severe disruptions in

U.S. oil production and refining so far, several oil ports

remain closed, while vast power outages can weigh on oil

demand," Goldman Sachs said in a note.

Most refineries in Houston and Texas City are designed to

maintain operations even amid heavy rainfall, but some of those

facilities, ports and other energy infrastructure can develop

problems from sustained power interruptions, experts said.

Marathon Petroleum Corp ( MPC ) was preparing on Monday to

restart multiple units at its 631,000-barrel-per-day (bpd)

Galveston Bay oil refinery in Texas City, sources said. The

plant was awaiting power to restart operations, the company said

in a state regulatory filing.

Phillips 66's 265,000-bpd Sweeny refinery in Texas

returned plants to normal operations after an upset on Monday

caused by Beryl. Citgo Petroleum temporarily reduced production

over the weekend at its 165,000-bpd Corpus Christi plant.

Ports from Point Comfort through Houston, including

Freeport, Galveston, and Texas City, saw damage along with

substantial operational delays, a shipping agency wrote in a

note to clients.

The Port of Corpus Christi reopened ship navigation on

Monday. The Port of Freeport said it reopened on Monday, adding

that some facilities were running on backup power while utility

crews worked to restore electricity.

The Houston Ship Channel opened to inbound traffic with

restrictions, a notice from the shipping agent said. Port

Houston said its terminals would be resuming operations on

Wednesday.

Vessel and cargo operations at the Port of Galveston, about

50 miles (80 km) from Houston, remained suspended on Tuesday as

power outages continued in parts of the city, said Rodger Rees,

CEO of maritime commercial center Galveston Wharves.

At least one cruise ship was cleared to dock at Galveston on

Tuesday.

Shell, Chevron ( CVX ) and BP started

redeploying personnel who had been evacuated from their Gulf of

Mexico platforms. Exxon Mobil ( XOM ) was assessing its Hoover

offshore platform, while working to restart operations, it said.

Freeport LNG, the third-largest liquefied natural gas

facility in the U.S., has not provided an operational update

since it said it reduced production on Sunday.

Enterprise Products Partners' ( EPD ) unit tripped due to

the weather at its natural gas liquids (NGL) processing facility

in Mont Belvieu, in east Texas, according to a filing.

Energy Transfer's ( ET ) Mont Belvieu NGL facility was fully

operational on Tuesday, the company said, following issues

reported in a regulatory filing. Mont Belvieu is the pricing

point for North American NGL markets.

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