Because of destructive high winds and unprecedented flooding, Hurricane Harvey has revealed itself to be one of the most devastating storms in the history of the Texas Gulf Coast – especially the Houston area. The storm was stronger than predicted when it made landfall between Port Aransas and Port O’Connor, Texas, and it moved through the region much more slowly than is typical for such storms, leaving roads, neighborhoods and businesses under water.
While the focus is and should be on the flooding that has occurred, Hurricane Harvey will have long-lasting effects on the energy supply chain. The Gulf Coast of the United States is responsible for about 17% of U.S. domestic oil production, so any disruption in the oil and gas supply chain around the Gulf Coast will have a knock-on effect for the rest of the U.S. economy.
Hurricane Harvey Offshore Evacuations
Even with the slow-moving nature of tropical rotating storms (TRSs), offshore installations (drilling rigs, FPSOs, platforms, etc.) require several days to prepare for a storm entering the Gulf of Mexico.
As part of general operations, the marine department is constantly monitoring weather conditions and making required adjustments to heading, ballast and cargo operations. When severe conditions such as a tropical storm threaten an offshore installation, both the operator and the installation manager work together to plan for the most probable outcome.
Deepwater drilling operations can be the most difficult to plan for, as some rigs operate in over 10,000 feet of water, and can reach drilling depths around 40,000 feet. That is a lot of drill-pipe and riser to pull before weather conditions make those operations impossible.
Stopping operations to pull subsea equipment is a tough decision; if the projected path of a storm changes or the storm dissipates, the lost time can be extremely expensive for both the operator and the drilling contractor.
Once the decision has been made to prepare for severe offshore weather conditions, evacuations are carried out in waves, with non-essential personnel evacuating first.
If the offshore installation is self-propelled, personnel from the marine and engineering crew will remain onboard to take the vessel to the safest location that can be reached (see navigable semi-circle).
Disruptions in the Energy Supply Chain
The disruption in offshore oil and gas operations before and during a TRS is only part of the problem.
The overall destruction caused by wind damage, storm surge and fresh water flooding can affect every aspect of the energy supply chain.
Downed power lines present several problems. The hazards associated with uncontained electrical current can cause a significant safety concern to the general public, but the limited number of linemen who can respond to and repair damaged lines also present a problem getting local electrical services back online.
Whether due to plant damage, a planned shutdown or damage to the local infrastructure, any shutdown of a refinery can cause a severe lack of supply of refined petroleum products to the market, driving up the price in the short term.
As stated earlier, damage to the local infrastructure can cause a disruption in the refining process, but that same damage can limit the distribution of both crude and refined products.
Some local Texas ports were closed for days, even after the storm diminished, as flood waters continued to cover roads and docks vital to the transportation of both products and personnel.
Even without any major environmental impact resulting from damage caused by a TRS, an oil and gas pipeline needs to be repaired and inspected prior to being brought back online.
Overall Impact to the Energy Supply Chain
Obviously, the primary concern with any severe weather event is the potential loss of life, which unfortunately was a result of Harvey’s devastation, but the toll TRSs have on the energy supply chain can be felt long after the storm subsides.
The oil and gas industry is no stranger to operational interruptions due to severe weather, which goes doubly so for the U.S. Gulf Coast. Oil and gas companies, as well as the thousands of supporting service companies, have become quite skilled at responding to the threat and devastation.
No matter how advanced the warning, severe weather will continue to affect the energy supply chain and, by extension, the entire the U.S. economy.
Our thoughts and prayers are with all of the families affected by the devastation of Hurrican Harvey. The best thing we can do is be prepared and respond to each threat accordingly.
Patrick Pistor is the Managing Director of Lean Oilfield, a business consulting firm offering digital marketing and sales consulting services for the oilfield. He is also the co-host of the Oil and Gas HSE Podcast and a staff writer for the Oil and Gas Global Network.