PASCAGOULA, Miss.—A tropical storm spinning toward the Gulf of Mexico coastline and expected to make landfall Tuesday had energy companies, property owners and insurers hoping to avoid a bumpy finale to an otherwise calm storm season.
Hurricane Ida, which dumped heavy rains in Central America and spawned storms that triggered deadly landslides and floods in El Salvador, was downgraded to a tropical storm early Monday with winds of around 70 mph. Tropical storm warnings were in effect from Grand Isle, La., to the Florida panhandle.
Forecasters predicted Ida would hit the U.S. mainland early Tuesday.
Property owners in the region were stocking up on supplies and boarding windows as the storm approached Monday. Energy companies with offshore operations in the Gulf evacuated rigs and slowed or stopped production as Ida moved closer.
Tim Culhane, London-based executive director of Willis Energy, a unit of Willis Group Holdings Ltd., said the weakening storm was unlikely to cause extensive of property damage to offshore energy facilities.
“It's right on the edge,” Mr. Culhane said of the storm's projected path toward a region of the Gulf Coast with a heavy concentration of offshore oil facilities. The track is similar to Hurricane Ivan in 2004, which triggered mudslides near the mouth of the Mississippi River that damaged oil pipelines, he said.
"Ida will track east of the largest concentrations of oil and gas platforms in the Gulf of Mexico today and tonight," Peter Dailey, director of atmospheric science at AIR Worldwide, said in a statement. "The Louisiana Offshore Oil Port has suspended the offloading of tankers and some companies have shut down some production. However, significant loss of production is not expected, nor is significant physical damage to offshore assets.”
“The way this is going, it's unlikely to have an impact,” Mr. Culhane said of Ida's weakening punch.
BP P.L.C. evacuated most nonessential personnel by early Monday. A spokesman for the London-based oil company said the storm was causing “a small impact on production,” but did not provide details.
BP said personnel remaining at its offshore platforms would keep operations running as long as conditions allow. “In the event that the storm worsens, operations personnel will work to ensure a safe and efficient shut-in of production and to also position the facilities for a safe and efficient restart,” the company said in a statement.
BP is self-insured for any losses from the storm, the spokesman said.
Separately, Anadarko Petroleum Corp. has removed all personnel and shut down production at four offshore facilities in the eastern Gulf of Mexico, the Woodlands, Texas, company said.
Shell Oil Co. has evacuated about 160 nonessential personnel from its production and drilling operations in the Gulf. As of early Monday, the storm had not affected its production, the Hague, Netherlands-based company said in a statement.
ExxonMobil Corp. is “evaluating potential personnel evacuation ahead of heavy weather at its Gulf of Mexico, Gulf Coast and Mobile Bay oil and gas operations,” the Irving, Texas-based company said in a statement early Monday.
Insurers and reinsurers have seen their fortunes rise this year as catastrophe claims from Gulf storms have been relatively low. Many have credited the lack of such losses for improved results reported through the first nine months of this year.
Meanwhile, coverage rates for offshore energy risks in the Gulf of Mexico have soared and some buyers have scaled back the amount of coverage they have purchased, or decided to self-insure those risks.
Near the end of a relatively benign hurricane season, Ida showed calm weather is never guaranteed, Mr. Culhane said.
“This is actually what underwriters would prefer rather than no storm at all,” Mr. Culhane said. “It is a reminder that these things can happen,” but is unlikely to produce much damage, he said.
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