Thursday, May 28, 2015

Take a Hint from Mother Nature? Texas Shut Wells as Storms and Flooding Batter Plains.


Graphic for Texas Shut Wells as Storms and Flooding Batter U.S. in Oil and Gas News













Published in Oil Industry News on Wednesday, 27 May 2015

 
Devon Energy Corp. shut wells and Kinder Morgan Inc. suspended operations at a fuel terminal southeast of Houston after storms flooded parts of Texas and cut power to tens of thousands. Refineries and pipelines continued to run.

Oklahoma City-based driller Devon stopped pumping from wells in areas affected by flooding in Texas, company spokesman John Porretto said by e-mail on Tuesday. Kinder Morgan suspended service at a complex in Pasadena, Texas, where trucks load gasoline and diesel after lightning affected the area’s electrical systems. 

Pipeline operators and refiners including Exxon Mobil Corp. and Enterprise Products Partners LP said they weren’t affected by the weather.

Storms have slammed Texas, home to the most oil-refining capacity in the U.S., with more than 10 inches of rain, flooding homes and freeways and halting bus and rail service. More than one-third of the nation’s oil production is in Texas.

“The production shut-ins are going to be temporary,” Andy Lipow, president of Lipow Oil & Associates LLC in Houston, said by phone. “The flooding on the roads and bayous are bad, but the Houston-area refineries don’t appear to be impacted.”

U.S. benchmark West Texas Intermediate oil sank $1.69, or 2.8 percent, on Tuesday to settle at $58.03 a barrel on the New York Mercantile Exchange.

Plants Operating

Operations at Exxon’s 560,500-barrel-a-day Baytown complex, Texas’s second-largest refinery by capacity, are normal, Deedra Moe, a spokeswoman for the plant, said by e-mail on Tuesday. Phillips 66, which owns two refineries in Texas, hasn’t been affected by the storms, company spokesman Dennis Nuss said by e-mail.

Marathon Petroleum Corp. declined to comment on the status of its two oil refineries in Texas, which have a combined capacity of 535,000 barrels a day. LyondellBasell Industries NV, which runs a 263,776-barrel-a-day plant in Houston, also declined to comment.

“I have seen no reports of injuries to employees or environmental impacts due to severe weather,” Bill Day, a Valero Energy Corp. spokesman in San Antonio, said by e-mail on Tuesday. The company runs an 88,000-barrel-a-day refinery in Houston. Day said he couldn’t comment on production rates.

Enterprise Products Partners LP, a Houston-based company that operates storage terminals and pipelines, hasn’t had significant trouble because of to the storms, company spokesman Rick Rainey said by e-mail Tuesday.

The truck racks at Kinder Morgan’s Jefferson Street terminal in Pasadena that halted operations were scheduled to resume service later on Tuesday, company spokesman Richard Wheatley said.

Warren Henry, a spokesman for driller Continental Resources Inc., said rain in Oklahoma has caused some delays in truck traffic.

“It’s not having a severe impact on operations,” Henry said by e-mail. “We’re working around the difficulties.”

EOG Resources Inc. has seen “very little disturbance to its operations,” K Leonard, spokeswoman for the Houston-based company, said.