US Gulf Coast Residents Flee, Oil Production Shut as Francine Intensifies

Tropical Storm Francine is on track to become a hurricane, the U.S. National Hurricane Center said on Sept. 10, prompting Louisiana residents to flee inland and oil and gas companies to shut-in Gulf of Mexico production.

Francine could wallop the Louisiana coast on Sept. 10 with life-threatening winds, drenching rains and an up to 10-ft (3-m) storm surge. Authorities called for a mandatory evacuation of residents in coastal communities, schools were shut and officials distributed sandbags.

The storm is anticipated to increase its forward speed on Sept. 10 just off the coasts of northeastern Mexico and southern Texas before making landfall near Cameron in Louisiana. It will be a major test for LNG export plants recently built in the region.

Energy companies began evacuating offshore workers and shut-in output at several production platforms ahead of the storm.

The region is home to about 15% of U.S. oil production and 2% of natural gas output.
According to the Bureau of Safety and Environmental Enforcement, 26% of natural gas production in the GoM has been shut as of Sept. 10 due to the storm. 

U.S. natural gas prices rose over 2% on worries about the production shut-ins and potential impact on LNG plants. Global oil demand concerns overshadowed the storm and U.S. crude futures fell more than 5%.

Oil refiners and fuel distributors along the Louisiana coast were preparing to weather the storm. Citgo Petroleum said its Lake Charles oil refinery was implementing its hurricane plan.

Kinder Morgan said it plans to shut its coal-handling International Marine Terminal on the Mississippi River by the end of Sept. 10.

Woodside Energy said it is partially evacuating personnel from its Shenzi oil production facility in U.S. Gulf of Mexico ahead of storm Francine. It also is fully evacuating staff from its coastal shorebase and warehouse facilities in Louisiana, a spokesperson said.

The port of Brownsville near the border with Mexico and other smaller terminals in Texas remained closed on Sept. 10, while other ports, including Houston, Galveston, Corpus Christi, Texas City and Freeport, were working with restrictions.

Between Texas and Louisiana, the Coast Guard set port condition "Yankee" for Beaumont, Port Arthur, Lake Charles, Cameron, Sabine, New Orleans, Baton Rouge and Plaquemines, meaning vessels must arrange immediate departure or seek alternate destinations. Cargo operations must cease.

Ports in Mississippi and Alabama, including Pascagoula also began preparations, but remained open for commercial traffic on Sept. 10. After landfall, the center of Francine is expected to move into Mississippi on the night of Sept. 11 or Sept. 12.

The port of New Orleans said it was preparing to close its terminal operations, with service to resume on Sept. 12 following damage assessments. The U.S Coast Guard on Sept. 10 set condition "yankee" for the port, restricting vessel traffic.

The New Orleans Public Belt Operations (NOPB), a railroad that serves the port, and the terminal's administration building were also set to close on Sept. 11. Operations there are planned to resume on Sept. 12, the port said in a release.

Energy pipeline operator Enbridge pulled employees from several U.S. Gulf of Mexico platforms. Its Manta Ray Gas Gathering system declared force majeure at its Green Canyon 158 Brutus receipt point and stopped receiving natural gas, the company told customers.

Exxon Mobil, Shell and Chevron on Sept. 9 removed offshore staff and halted some Gulf of Mexico oil and gas operations.

Shell does plan on continuing to run the 233,702 bbl/d Norco, Louisiana refinery at full rates through Tropical Storm Francine, two people familiar with plant operations said on Sept. 10. A designated group of employees, called the ridethrough crew, will operate the refinery beginning early on Sept. 11, the sources said. Shell began sending all other workers home from the refinery at noon CDT (1700 GMT) on Sept. 10.

New LNG export plants in Louisiana-Sempra's Cameron LNG, Venture Global LNG's Calcasieu Pass LNG and Tellurian's Driftwood LNG development-are in the crosshairs of Francine.

Natural gas flowing to the Cameron LNG export plant dropped on Sept. 10 to 1.3 Bcf/d from about 2.2 Bcf/d on Sept. 9, LSEG data showed. Sempra did not reply to a request for comment.

Freeport LNG, which operates the nation's second-largest export plant for the super-chilled gas, said it had begun storm preparations at its Texas plant without providing details.