MMS says onshore damage 'major hindrance' to Gulf oil recovery

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http://www.energybulletin.net/8956.html

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US Dept Interior says onshore damage 'major hindrance' to Gulf oil recovery

Hurricane Katrina doesn't appear to have caused the same damage to offshore pipelines as Hurricane Ivan, but instead did terrible damage ashore that has bottled up oil production, the U.S. Minerals Management Service said Friday.

"The major hindrances to restoration of energy resources have been damage to onshore infrastructure, such as refineries, processing plants and pipelines; difficult and intermittent communications in the Gulf region; shortage of helicopters, boats, divers and power," the MMS said in a statement released Friday morning. "35% of shut in oil is due to problems with onshore infrastructure."

Four refineries accounting for 5% of U.S. capacity remain shut in the wake of the storm. In addition, the Empire petroleum terminal operated by Chevron Corp. (CVX) was damaged, bottling up output from Gulf of Mexico producers who are otherwise ready to come back on line.

The storm also inundated the important offshore oil service port at Venice, La., and did significant damage to natural gas processing plants owned by Dynegy Corp. (DYN), Enterprise Products Partners (EPD) and others that have the capacity to handle more than 40% of the Gulf's output.

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