U.S. Gulf Coast oil industry groans under uneven Ida recovery By Reuters

By Marianna Parraga and Liz Hampton

HOUSTON (Reuters) -The engine of the U.S. offshore energy industry struggled to recover from Hurricane Ida on Friday as a lack of crews, power and fuel left most Gulf Coast oil and gas production offline five days after the storm passed.

Ports were reopening and some pipelines restarted as companies completed post-storm evaluations. Offshore producers faced larger hurdles as damages were still being uncovered and electric utilities kept some refiners waiting for power to begin restarts.

Crews have not returned to three-quarters of the evacuated platforms and 93% of oil production and 89% of remained offline, government data showed. Some wells in the Gulf of Mexico, which accounts for about a fifth of U.S. output, could be shut for weeks, analysts said.

EMERGENCY OIL RELEASE

The White House sought to ease worries about regional fuel shortages by providing 1.5 million barrels of crude oil to Exxon Mobil (NYSE:) to produce gasoline. Four large refineries in the state remain shut.

About 820,000 homes and businesses in the state lacked power. About two-thirds of gasoline stations from New Orleans to Baton Rouge were without fuel, according to tracking firm GasBuddy.

Shortages included aviation fuel for helicopters that conduct post-hurricane aerial evaluations and ferry workers to and from platforms. Ida’s winds crushed fuel depots and helicopter pads.

“Loading and discharging remains pretty much halted in Louisiana,” said a Gulf Coast shipper who asked to remain anonymous. “Ports have been reopening, but portions of the Mississippi are still closed and there are restrictions on hours of navigation and vessel draft.”

The Louisiana Offshore Oil Port, the primary U.S. deepwater export terminal, remained closed, according to its website. A prolonged outage would affect oil exports to Asia, said analysts.

DAMAGES OFFSHORE

Royal Dutch Shell (LON:), the largest Gulf of Mexico producer, has resumed just 20% of usual production, the company said. The storm damaged an offshore facility known as West Delta-143 connecting three large oil production basins accounting for an eighth of the Gulf’s oil production, Shell said, though the extent was not immediately clear.

“Shell’s West Delta situation is an indication of how slow recovery will be this time,” said Aaron Brady, an analyst with consultancy IHS Markit. “We can expect that a significant amount of oil is likely to be offline for some time, possibly weeks.”

The storm cut 1.7 million barrels of oil per day and 1.99 billion cubic feet per day of natural gas output, according to government data released on Friday.

Damages to offshore oil facilities could cost insurers about $1 billion, estimated CoreLogic.

Tony Odak, chief operating officer of Stone Oil Distributor, which supplies fuel to offshore producers, said he has begun getting supplies from as far away as Port Arthur and Galveston, Texas.

“We are securing resupply outside the Mississippi River right now,” said Odak.

Pipeline operator Enbridge (NYSE:) said two of its offshore pipelines were ready to return to service. It has been unable to access a third facility, it said.

PORTS REOPENING

Most Louisiana ports have reopened, including the Port of New Orleans, while Port Fourchon, an offshore resupply hub, reopened on Thursday for daylight operations only. Extensive damages at Port Fourchon were affecting deliveries to offshore platforms, analysts said.

Entergy Corp (NYSE:). officials said Louisiana’s largest utility was attempting to remove a downed transmission line blocking river traffic in one area near New Orleans.