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Terminal News

Tropical Storm Harvey batters Gulf Coast

Tropical Storm Harvey batters Gulf Coast
Tropical Storm Harvey continues to batter the Texas Gulf Coast as major oil and gas players, as well as terminal operators, implement emergency plans to mitigate its affects.

The former hurricane – downgraded to a tropical storm – has devastated homes and communities as it slowly makes its way up the coast towards Louisiana. At least nine people are reported to have been killed and thousands have been rescued from the flooding. So far, nine trillion gallons of water has fallen in the Texas region – with the Houston area being the worst hit area. Areas southeast of downtown Houston reported more than 48 inches of rain, the most every recorded from a tropical storm in the contiguous US.

The storm made landfall on Friday night (August 25) as a category 4 hurricane near Corpus Christi. A further 20 inches of rain is expected to fall by the end of the week.

The storm has had a significant impact on the country's oil and gas industry and analysts have said it could be one of the 10 costliest storms in US history as insurers try to assess the damage.

According to S&P Global Platts, refinery outages and port closures continue to spread as the storm continued to flood the area, lifting petrol prices.

2.33 million b/d of refining capacity is shut, but with refiners also cutting rates that figures is expected to be much higher.

The stream of distillate cargoes from the US Gulf Coast to Northwest Europe and the Mediterranean basin has halted in the last eight days as the storm forced the closure of terminals, ports and refineries.

According to the US Department of Energy, 19% of oil production and 18% of natural gas production in the Gulf of Mexico was shut-in. Six refineries in the Corpus Christi area and five refineries in the Houston/Galveston area are shut in. Four refineries in the Houston/Galveston area, one in the Beaumont/Port Arthur and two in the Lake Charles area are operating at reduced rates.

Houston-area refiners, including ExxonMobil, Valero, Magellan, Buckeye, Shell and Phillips 66 have shut some of their operations due to flooding.

The US Coast Guard set port condition Zulu, where the port is closed and all port operations are suspended, for Louisiana port Lake Charles and Texas ports Beaumont, Nederland, Orange, Port Arthur, Port Neches, Sabine and Sabine Bar.

Corpus Christi area ports and Houston/Galveston area ports remain closed.

The Galveston ship channel will remain closed to all inbound and outbound traffic for the next two days.

Magellan has suspended operations on two long-haul pipelines – BridgeTex and Longhorn, and Kinder Morgan has shut down select systems of its 3000,000 barrels per day crude and condensate pipeline in Texas.

Colonial Pipeline is running at reduced capacity due to limited supply from Houston refiners and the Explorer Pipeline closed midnight Tuesday to allow product to back up at the start of the line and enable faster deliveries at the northern end.

Storage terminals

- Magellan has suspended operations at its crude terminal and condensate splitter in Corpus Christi;

- Buckeye Texas Partners has suspended all marine terminal operations in Corpus Christ, Texas and has shut down its crude, condensate, fuel oil and naphtha storage facilities in the area – totalling 2.3 million barrels of storage;

- Phillips 66 has suspended operations at its Freeport, Texas terminal after Port Freeport was closed;

- Phillips 66 has also shut its crude and products storage terminal at Nederland, Texas;

- NuStar Energy has shut down its crude and refined products terminal in Corpus Christi.

Check for the latest news and developments on Tropical Storm Harvey.

Picture credit: NASA