Rita Causes Record Damage To Oil Rigs (New Estimates...Damage Not Bad Huh?)

Financial Times ^ | 9-27-05 | Carola Hoyos

[My Favorite Headache]

Rita causes record damage to oil rigs By Carola Hoyos in London, Sheila McNulty in Houston and Thomas Catan in Johannesburg Published: September 27 2005 20:14 | Last updated: September 27 2005 20:14

Hurricane Rita has caused more damage to oil rigs than any other storm in history and will force companies to delay drilling for oil in the US and as far away as the Middle East, initial damage assessments show.

ODS-Petrodata, which provides market intelligence to the offshore oil and natural gas industry, said it expected a shortage of rigs in the US Gulf this year.

“Based on what we have right now, it appears that drilling contractors and rig owners took a big hit from Rita,” said Tom Marsh of ODS-Petrodata. “The path Katrina took was through the mature areas of the US Gulf where there are mainly oil [production] platforms. Rita came to the west where there is a lot of [exploratory] rig activity.”

Ken Sill of Credit Suisse First Boston said: “Early reports indicate numerous rigs are missing, destroyed or have suffered serious damage and several companies have yet to report. Rita may set an all-time record.”

The US Coast Guard said nine semisubmersible rigs had broken free from their moorings and were adrift.

This damage could not have come at a worse time for oil companies and consumers. US crude futures on Monday fell 37 cents to $65.45 a barrel in midday trading in New York as refineries that were evacuated before the onset of Rita returned to operation.

Earlier in the day, Ali Naimi, Saudi Arabia's oil minister, said the market had not taken up the 2m barrels a day of spare capacity the Organisation of the Petroleum Exporting Countries offered last week. Speaking in Johannesburg, he blamed high oil prices on a lack of industry infrastructure, including rigs and refineries, rather than oil reserves. Rigs, which are movable and are used for exploration and development, were in short supply before hurricanes Katrina and Rita blew through the US Gulf in late August and September.

High oil prices and the desperate search for new oil supplies needed to meet rampant demand from the US and China have made rigs difficult to find and expensive to hire. Rigs cost $90m-$550m to construct, depending on how sophisticated the structure and how deep the water in which it will drill. A rig ordered today is unlikely to be ready before 2008 or 2009, analysts said.

As a sign of just how precious rigs are becoming to the market, Anadarko, the biggest US independent oil company, this week set a record by committing to a rig six years in advance; commitments in the past were made months ahead of time rather than years.

Initial reports from companies are ominous. Global Santa Fe reported it could not find two of its rigs. Rowan Companies reported four rigs damaged, with two having moved, one losing its “legs” and the fourth presumed sunk. Noble has four rigs adrift, with two run aground one into a ChevronTexaco platform.

[WKB]

I have not heard one person say one word about
a missing family member in the these last 30 days.
I am just glad these 800 to 1500 dead people
were all homeless bums with no family and nobody
cares about them anyway.

[Knitting A Conundrum]

My great uncle, in OKC, lived a block from an oilwell...in a residential neighborhood...your pic made me think of that...

[HoustonCurmudgeon]

OK but it's still not that bad. When a storm comes they shut in the wells on the seabed. If you need to set a new platform it will be a major cost and take time, however you still have the wells in place. The oil industry is a great bunch of can do people ... when left alone to do their work.

Sorry if I sounded a bit testy.

[PAR35]

Sorry, my temper gets short on these threads sometimes. There are adequate supplies of crude; refining capacity is the real concern.

[Diddle E. Squat]

So if Katrina evacuees from NOLA>Houston>Belzoni show up at your door, send them to the mother-in-law's place?

Seriously, sorry to hear about the MS tornadoes the other day. Heard that the MS State campus got hit.

[VRWCTexan]

My apology to you as well - I've worked in the offshore field for 36 years my-self....and was a bit shocked to see Typhoon up-ended.

There are other so called mini-TLPs in the Gulf (and not knowing their locations I was concerned that it was a design flaw that may have been repeated)

[WKB]

Heard that the MS State campus got hit.



Yes at last report the tornado had made $100,000
in improvements. :>) JK

[blam]

"Sorry, my temper gets short on these threads sometimes. There are adequate supplies of crude; refining capacity is the real concern."

No problem, I get exasperated at times too.

I'm a retired chip-maker and know very little about oil. Albeit, Texas Instruments is a spin-off from an oil service company.

[Ursus arctos horribilis]

And no Major seldom runs the risk of going it alone, almost all outlays are joint ventures by percentage wise. When one sees a platform or field, the signs may all be Chevron, or say Shell. But they are either the major joint venture investor, or, they were elected by the other joint owners as operator of the lease or facility.

The Major I worked for was not one of the true giants, but we had a excellent reputation as cost effective operators. Often even when a lesser joint venture owner, we operated many fields and offshore platforms.

[WKB]

I heard alligators also consumed many dead bodies.



No you're confused. That was the sharks in the
streets of NO that ate all the people.

[VRWCTexan]

My one laugh this weekend was when a Fox news babe asked the Coast Guard if they were rushing out to rescue the TransOcean rig that snapped their towing-cable - he politely advised that these guys are the real "experts" and will "rescue themselves" without any support needed from the USCG

[ordinaryguy]

CNN was running missing person photos on the left side of their screen for days. I don't know how many of those people were just separated and wound up in different shelters than their families, but probably not all of them.

[WKB]

CNN was running missing person photos



Thanks for giving me another reason NOT
to watch CNN

[Ursus arctos horribilis]

You got that right. The Major I am retired from built the last refinery in the USA back in 1979 at Garyville, LA.

[ordinaryguy]

And what exactly would that reason be? So that you can convince yourself that nobody went missing in Katrina? Because you have something against missing people? Please share.

[Ursus arctos horribilis]

They stopped after ABC News said they were liars. Gads, I still have hope of the MSM going to war with one another in the shrinking market.

[WKB]

see # 76

[WKB]

Because you have something against missing people? Please share.


No but I do have plenty against FR rumor mongers.

[HoustonCurmudgeon]

The TLP in the Chevron Typhoon field is a SeaStar built by Atlantia Offshore. I do not know of others in use nor have I seen any pictures on the web.

[ordinaryguy]

What was the lie? Do you have a link?