How hurricane season might impact Gulf of Mexico oil production

decrease font size  Resize text   increase font size       Printer-friendly version of this article Printer-friendly version of this article

Hurricanes and tropical storms in the Gulf of Mexico can severely disrupt the supply of crude oil and natural gas from offshore platforms to onshore processing facilities. Predicting the formation of hurricanes and tropical storms is an uncertain science, and most forecasters speak in terms of probabilities or ranges. The National Oceanic and Atmospheric Administration (NOAA) released its Atlantic Hurricane Season Outlook on May 19, 2011, indicating that the Atlantic basin will likely experience above-normal tropical weather activity during the upcoming hurricane season (June 1 - November 30). NOAA projects 12 to 18 named storms will form within the Atlantic basin over the next six months, including 6 to 10 hurricanes, of which 3 to 6 will be intense.

When severe tropical weather threatens the Gulf of Mexico region, it is difficult to predict the effects on crude oil production. The level of shut-in production depends on a number of factors, including the overall intensity of severe weather, the specific track of each storm, and producers' response to the threat. Production outages have varied greatly over the last few years (see Figure 1). Although hurricane activity within the entire Atlantic Basin was higher than normal during 2010, only two minor storms impacted the Gulf producing region, shutting in 4.3 million barrels of crude oil (about 2 percent of normal production). In contrast, Hurricanes Gustav and Ike shut in over 60 million barrels of crude oil during 2008 (about 25 percent of normal production).

click image to zoom

In a supplement to the June edition of the Short-Term Energy Outlook ( 2011 Outlook for Hurricane-Related Production Outages in the Gulf of Mexico), EIA simulated the probability distribution for seasonal shut-in crude oil production in the Gulf of Mexico using information from NOAA's most recent hurricane projections. The simulated median cumulative volume of shut-in production over the course of the entire upcoming hurricane season was 19 million barrels, three times the estimated median cumulative outage during a season with normal hurricane activity. However, projections of shut-in production are highly uncertain. For example, there is a 70-percent probability that shut-in offshore production for the entire season will fall between 3.2 and 53.5 million barrels of crude oil. Intervals with a higher likelihood of encompassing the actual level of shut-in production would be even wider. Even with NOAA's projection of above-normal hurricane activity this year, the likelihood of experiencing a season similar to 2008 is only 11 percent.


Buyers Guide

Doyle Equipment Manufacturing Co.
Doyle Equipment Manufacturing prides themselves as being “The King of the Rotary’s” with their Direct Drive Rotary Blend Systems. With numerous setup possibilities and sizes, ranging from a  more...
A.J. Sackett Sons & Company
Sackett Blend Towers feature the H.I.M, High Intensity Mixer, the next generation of blending and coating technology which supports Precision Fertilizer Blending®. Its unique design allows  more...
R&R Manufacturing Inc.
The R&R Minuteman Blend System is the original proven performer. Fast, precise blending with a compact foot print. Significantly lower horsepower requirement. Low inload height with large  more...
Junge Control Inc.
Junge Control Inc. creates state-of-the-art product blending and measuring solutions that allow you to totally maximize operating efficiency with amazing accuracy and repeatability, superior  more...
Yargus Manufacturing
The flagship blending system for the Layco product line is the fully automated Layco DW System™. The advanced technology of the Layco DW (Declining Weight) system results in a blending  more...
Yargus Manufacturing
The LAYCOTE™ Automated Coating System provides a new level of coating accuracy for a stand-alone coating system or for coating (impregnating) in an automated blending system. The unique  more...
John Deere
The DN345 Drawn Dry Spreader can carry more than 12 tons of fertilizer and 17.5 tons of lime. Designed to operate at field speeds up to 20 MPH with full loads and the G4 spreader uniformly  more...
Force Unlimited
The Pro-Force is a multi-purpose spreader with a wider apron and steeper sides. Our Pro-Force has the most aggressive 30” spinner on the market, and is capable of spreading higher rates of  more...
BBI Spreaders
MagnaSpread 2 & MagnaSpread 3 — With BBI’s patented multi-bin technology, these spreaders operate multiple hoppers guided by independent, variable-rate technology. These models are built on  more...


Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left


Kinze 1500 Grain Cart

The Kinze 1500 Grain Cart is engineered for speed and reliability required of custom harvesters. Load up to 1500 bushels ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Feedback Form