Fuels

Rita Fuels Exodus

Citizens leaving Houston area as hurricane barrels toward oil refineries

HOUSTON -- Hundreds of thousands of people across the Houston metropolitan area struggled to make their way inland in a bumper-to-bumper exodus Thursday as Hurricane Rita closed in on the nation's fourth-largest city, said the Associated Press.

The storm weakened Thursday from a Category 5 hurricane to a Category 4 as it moved across the Gulf of Mexico, and forecasters said it could lose more steam by the time it comes ashore today or Saturday. But it could still be a dangerous stormone aimed straight at the nation's biggest concentration of oil refineries, [image-nocss] said the report.

Highways leading inland out of Houston, a metropolitan area of 4 million people, were clogged up to 100 miles north of the city. Stations reported running out of gasoline, and police officers carried gasoline to motorists who ran out, the report said. Texas authorities also asked the Pentagon for help in getting gasoline to drivers stuck in traffic, and sent gasoline tankers to take up positions along evacuation routes to help, it added.

Oil refineries and chemical plants in and around Houston began shutting down, and hundreds of workers were evacuated from offshore oil rigs.

Environmentalists warned that the stretch of coast threatened by Rita is home to 87 chemical plants, refineries and petroleum storage installations, raising the possibility that the storm could cause a major oil spill or toxic release. Southeastern Texas is also home to more than a dozen active Superfund sites.

In a press briefing yesterday afternoon, American Petroleum Institute (API) President Red Cavaney said, while oil companies are making the maximum effort to prepare for Hurricane Ritawe are facing an unprecedented situation, with a Category 5 hurricane bearing down on the heartland of our operations along the Gulf Coast at a time when our companies are still in the early stages of recovery from Hurricane Katrina's devastation.

He added, Shutdowns of industry facilities could impact the flow of gasoline and other fuels, and he appealed to consumers to conserve fuel.

Cavaney also provided an overview of the situation as it stood at that time:

Refining

U.S. refineries in Texas and Louisiana are taking precautions as Hurricane Rita moves closer. Many may reduce runs or shut down. Each company will decide based on its own facilities and their location relative to the path of the hurricane. Shutting facilities is necessary to ensure the safety of employees and surrounding communities and to help protect the environment. Shutdowns take one or two days. Within the potential path of the hurricanean area stretching from Corpus Christi, Texas, to Lake Charles, La.are 21 refineries, comprising 27.5% of U.S. refining capacity. The shutdown or anticipated shutdown of any significant part of that capacity could affect U.S. gasoline markets, since more than 5% of U.S. refining capacity is already shut down by Katrina. It takes several days to restart refineries.

Pipelines

Major crude oil and product pipelines had fully recovered from Katrina, though not all local pipelines were back in service. Like Katrina, Rita could well likely cause serious pipeline disruptions. Kinder Morgan's Galena Park Terminal, the originating point of the Longhorn pipeline on the Houston Ship Channel, was shut down at noon Wednesday. The Longhorn pipeline is down and will stay down until the terminal resumes operation. The Explorer pipeline was down, as of Wednesday, but was still receiving product into its Port Arthur facility until about 10:00 a.m. today. Explorer's other facilities are being readied for shutdown.

Offshore

The Gulf of Mexico provides 29% of U.S. oil production and 19% of U.S. natural gas production. Shut-ins for offshore industry operations are standard procedures to protect workers onplatforms and to safeguard the environment. As of Monday, 56% of the daily oil production in the Gulf was shut-in as a result of Katrinaand 34% of the natural gas production. As of today [Thursday], the impact of evacuations and shutdowns associated with Rita were having an effect92% of oil production from the Gulf was shut-in and 66% of daily natural gas production.

LOOP

The Louisiana Offshore Oil Port (LOOP), which services tankers delivering oil imports, is now shut down.

Ports

A number of important portsincluding Houston and Port Arthurare likely to be in the path of Rita facilities accounting for 10% to 15% of our oil imports could be impacted.

Click here for the U.S. Energy Information Administration's (EIA) Daily Report on Hurricane Impacts on U.S. Energy.

Click here for the U.S. Office of Electricity Delivery & Energy Reliability's daily hurricane Situation Reports, which detail the status of refineries.

To view API's Refinery Capacity: Texas & Western Louisiana (pictured), click here.

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