Reuters: UPDATE 2-Oil companies shut Gulf of Mexico output on storm

Thu Sep 20, 2007 11:38am ET

(Updates oil prices, adds comments from BP spokesman, background, paragraphs 3, 7-9)

HOUSTON, Sept 20 (Reuters) – Energy companies evacuated personnel and shut in oil and natural gas production from rigs in the Gulf of Mexico as a tropical depression barreled toward the region.

U.S. National Hurricane Center and other weather models show a tropical storm could form Thursday as the tropical disturbance enters the Gulf. [ID:nN20378924]

Oil prices gained 27 cents to $82.20 a barrel as dealers weighed the possibility of significant production outages from the region, home to about a quarter of U.S. oil production and 15 percent of the nation’s natural gas production.

Shell (RDSa.L: Quote, Profile , Research) said it is shutting a total of 370,000 barrels of oil equivalent per day from its North Padre Island production block 969 and West Cameron block 565 platforms ahead of the storm. Total (TOTF.PA: Quote, Profile , Research) shut the Matterhorn platform.

Anadarko Petroleum Corp (APC.N: Quote, Profile , Research) said it began shutting some 145,000 boepd of production from the eastern and east-central Gulf of Mexico from the Independence Hub, Constitution, Neptune and Marco Polo platforms.

BP (BP.L: Quote, Profile , Research), ConocoPhillips (COP.N: Quote, Profile , Research), Exxon Mobil (XOM.N: Quote, Profile , Research) and Total were also reducing output from the region. [ID:N20391476]

“Operational personnel have begun leaving facilities and will be onshore later today,” a BP spokesman said. “The process of production shut-ins has begun on a number of platforms.”

U.S. energy and commodity markets watch tropical storms closely because they can interfere with oil, natural gas, and crop production.

Hurricanes Katrina and Rita in 2005 temporarily knocked out a quarter of U.S. crude and fuel production, toppling offshore platforms, wrecking undersea pipelines, flooding coastal refineries and sending energy prices to then-record highs.

The NHC will name the next tropical storm “Jerry.” A tropical storm packs winds of 39 to 73 mph (63-117 kph).

(Reporting by Erwin Seba, Richard Valdmanis, Janet McGurty, Robert Campbell, Matthew Robinson)

© Reuters 2007. All Rights Reserved.

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