Reply #26: I think we are closer to having shortages than they're admitting [View All]

[htuttle]

I know they are doing some localized rationing in the South right now, but I bet there has been more damage to the oil infrastructure than they are talking about.

They've reported about seven Gulf rigs adrift, but little news about the LOOP terminal. Articles found via google state that it's been closed for two days now.

Check this one out:

http://quote.bloomberg.com/apps/news?pid=10000006&sid=a03V6JfmkZ.I&refer=home

The LOOP terminal usually handles about 1 million barrels of crude oil a day, or 11 percent of U.S. imports. It consists of mooring buoys, platforms and pipelines.

``We are encouraged by the initial damage assessment,'' Mark Bugg, scheduling manager at New Orleans-based Loop LLC, the port operator, said yesterday.

The port will not resume oil shipments until power is restored, Bugg said. Entergy Corp., which provides power for the pipeline system connecting the port to refineries, said it will take weeks to rebuild its electric delivery system in Louisiana, where 80 percent of its customers are without power.

``The LOOP is incredibly important right now,'' said John Kilduff, vice president of risk management at Fimat USA in New York. ``If it is not up soon there will be a spillover for refineries in the Midwest, which could run out of crude quickly. This could lead to gasoline shortages in the weeks ahead.''

If the LOOP terminal is down for weeks, we WILL run into serious shortages in the Continental US.

Here's another article about the problem actually refining the crude, even if the LOOP were open to deliveries:

Port Fourchon, Louisiana, the base for three-quarters of support services to the Gulf's deepwater oil and gas facilities and the land base for the offshore oil port, is shut because of the storm, Port Director Ted Falgout said in an interview.

``We have just got to the head of the port,'' Falgout said. ``We have yet to enter because there are several large vessels on the highway in the port itself.''

More than 600 offshore platforms are within 40 miles of Port Fourchon, according to the port's Web site.

``It's going to be extremely difficult to supply and repair platforms if the port is closed,'' Falgout said. ``The nearest alternative location for logistics is Venice, Louisiana, which was totally destroyed.''

Repairs to Gulf platforms and pipelines damaged by Hurricane Katrina will be delayed if the storm deposited silt in the port's channel, Falgout said.

http://quote.bloomberg.com/apps/news?pid=10000006&sid=aekrFQAUUnsw&refer=home

Yup, I'd say we are staring gas rationing in the face right now.