Oil companies watch for possible Gulf of Mexico storm

Reuters News
Posted: Aug 30, 2011 3:58 PM
Oil companies watch for possible Gulf of Mexico storm

HOUSTON (Reuters) - U.S. oil companies were monitoring a developing weather system in the western Caribbean Sea that some weather forecasters say may develop late this week into a tropical storm in the northwestern Gulf of Mexico, home to the U.S. offshore oil patch.

"We had seen there was a chance of development, but we're not taking any action beyond monitoring it," said Barb Hestermann, spokeswoman for the Louisiana Offshore Oil Port.

No offshore production has been shut or refinery output curtailed due to the storm threat.

It's south of Cuba," said Richard Wheatley, spokesman for El Paso Corp "We're monitoring it as we always do.

BP Plc ConocoPhillips, Marathon Oil Corp, Marathon Petroleum Corp and Apache Corp also said they were watching the system.

The U.S. National Hurricane Center gives the system a 10 percent chance of becoming a tropical cyclone in the next 48 hours, but said it could develop further when it reaches the western Gulf.

U.S.-regulated areas of the Gulf of Mexico roughly account for 30 percent of U.S. oil production and 12 percent of natural gas output, according to the U.S. Bureau of Ocean Energy Management.

About 30 percent of U.S. natural gas processing plant capacity and 40 percent of the nation's refining capacity also line the Gulf Coast, according to the U.S. Energy Information Administration.

Forecasters have said the 2011 hurricane season will spawn six to eight hurricanes, up to six of which half could become major.

(Reporting by Erwin Seba and Kristen Hays;editing by Sofina Mirza-Reid)