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Oil and natural gas producers in the Gulf of Mexico have stopped sending workers, evacuated from offshore rigs because of Hurricane Gustav, back to the platforms as Hurricane Ike approaches, a government agency said Wednesday.
The Minerals Management Service (MMS), which tracks offshore operations, estimated that 452 of the 717 manned production platforms – about 63% – remained evacuated in the wake of Gustav, which struck off the coast of Louisiana earlier this month.
About 95.9% of oil production in the region had been shut down, according to MMS, citing energy company reports.
“Production was coming back online, but now as a result of Ike, production is being shut down again,” said John Rodi, Gulf of Mexico regional director with MMS.
Facilities in the Gulf account for about a quarter of U.S. crude oil production.
Platforms and pipelines in the region have been strengthened since Hurricanes Katrina and Rita devastated production in 2005. The storms, which reached Category 5 strength before making landfall, destroyed 113 offshore oil and natural gas platforms and damaged 457 pipelines that year.
However, Gulf facilities remain vulnerable to extreme storms. Energy companies have been working for the past several days to shut down operations ahead of Ike, according to Rodi.
“It takes a certain amount of time for [producers] to ramp up production, and then a certain amount of time to ramp down,” he said.
In the past, oil investors have responded to storms by driving up energy prices. But with recent fears about falling demand for crude and the failure of Gustav to inflict any major damage, investors have so far largely ignored the storm threat.
Hurricane Ike was on track to strike the north Texas coast this weekend, according to the National Hurricane Center.
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