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Shell Keeps Staff Onshore for Ike as Refinery Repairs Continue

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Shell Keeps Staff Onshore for Ike as Refinery Repairs Continue 

By Stephen Voss

Sept. 7 (Bloomberg) — Royal Dutch Shell Plc, Europe’s largest oil company, delayed deploying most staff back to offshore platforms in the Gulf of Mexico because of an approaching hurricane.

The company has returned about 615 people to offshore facilities in the aftermath of last week’s Hurricane Gustav and a “small amount” of production has been started again, it said in a statement yesterday.

Gustav came ashore about 85 miles (136 kilometers) southwest of New Orleans on Sept. 1, with winds that toppled electricity lines, causing widespread blackouts. While Exxon’s Baton Rouge refinery, Louisiana’s largest, was forced to shut that day because of a loss of power, damage to oil installations in the region was less than forecast.

“Shell is not, at this time, redeploying all personnel (approximately 1,400) who were evacuated prior to Gustav because of the possibility that Hurricane Ike might enter the Gulf of Mexico next week and require another evacuation,” the statement said.

Ike was east of Great Inagua Island, Bahamas, at 8 a.m. local time and is projected to move west across Cuba and into the gulf over the next two days, according to the U.S. National Hurricane Center.

Shell’s pipelines in the region didn’t suffer any significant damage from Gustav, and most of them will be ready for service by today, The Hague-based Shell said in another statement. The Capline crude-oil pipeline, which connects Louisiana crude terminals with Midwest refiners, has begun to operate, using local utility power.

Refinery Power

A pipeline linking Houma, Louisiana, and Houston, was expected to have nearly all capabilities restored by today.

The Motiva Enterprises LLC refinery in Norco, Louisiana, shut by Gustav, had power service restored and was expected to resume some gasoline production as of today, Shell, a partner in the Motiva joint venture with Saudi Aramco, said yesterday.

At Motiva’s refinery in Convent, Louisiana, which was also shut, power from the local utility is being used and “repairs to internal power lines and other facilities are progressing,” Shell said. The “initialization” of some Convent refinery units could begin next week, Shell said yesterday.

Fields in the Gulf produce 1.3 million barrels a day of oil, about a quarter of U.S. production, and 7.4 billion cubic feet a day of natural gas, 14 percent of the total, government data show.

Hurricane Katrina in 2005 closed 95 percent of regional offshore output and, along with Hurricane Rita, idled about 19 percent of U.S. refining capacity.

To contact the reporter on this story: Stephen Voss in London at[email protected]

Last Updated: September 7, 2008 08:56 EDT

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