Shell declares force majeure in Gulf of Mexico

  • : Crude oil
  • 21/09/09

Shell declared force majeure on "numerous" crude delivery contracts due to damage to its Gulf of Mexico offshore operations arising from Hurricane Ida.

Damage discovered shortly after the storm to Shell's West Delta-143 shallow water platform, which serves as a hub for numerous offshore production pipelines, is still being assessed, the company said. But declaring the force majeure today is a sign that the platform is unlikely to be repaired any time soon, and may require extensive work.

"Crews are working to complete a comprehensive assessment of the damage and, to the degree possible, assess how long production from our Mars corridor assets will be impacted," Shell said today.

About 233,000 b/d of Mars crude from three Shell platforms — Mars, Olympus and Ursa — moved through the WD-143 platform each month this year through July. That crude flow would then meet up with other pipelines to deliver up to 376,000 b/d of crude to the Louisiana Offshore Oil Port (LOOP) facilities in Clovelly, Louisiana, during the same time period. Production from those three platforms currently has no other way to reach market.

Shell — a major Gulf of Mexico producer — estimates that 80pc of its offshore production remains off line.

About 76pc of US offshore crude production from the Gulf, or 1.392mn b/d, remains offline as of 12:30pm ET today, 11 days since the storm came ashore, according to the Bureau of Safety and Environmental Enforcement (BSEE). That is only marginally down from 77pc, or 1.399mn b/d, yesterday.

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