Sunday, September 25, 2005

Rita - And The Gas Price Went Up When ?

Rita wasn't as bad as expected. Thank God.

Damage to the vital concentration of oil refineries along the coast appeared relatively light, although industry officials said it was too early to assess whether there would be an impact on oil prices.

Valero Energy Corp. said its 255,000-barrel-per-day Port Arthur refinery sustained significant damage to two cooling towers and a flare stack and would need at least two weeks for repairs.

Late Saturday, two environmental cleanup workers spread booms and oil absorbent pads along a perimeter fence at the refinery. Knee-deep floodwaters were stained with dark brown crude oil, and the odor of petroleum hung thick in the air.

Via Reuters we find ...

It also appeared, at least initially, to have mostly spared crucial oil refineries at a time when supplies of gasoline and other refined products are already stretched.

"The heavy commercial and industrial areas of Port Arthur and Beaumont - with their numerous refineries - were to the left of the storm's track, where wind speeds are lower, so we do not expect to see significant structural damage to the refineries," Jayanta Guin, vice president of research and modeling at AIR Worldwide, said in a statement.

Beatty said a fair ballpark estimate for Rita damage from wind and surge effects, plus physical damage to offshore oil platforms, was in the range of $5 billion. That figure excludes any impact from potential new flooding.

Rita slammed into evacuated towns and oil-rich swamplands of the Texas-Louisiana border early Saturday, causing widespread damage and power outages. The powerful storm hit with 120 mph (193 kph) winds and punishing rains, then weakened slightly as it moved inland.

It spared Houston, the fourth largest U.S. city, a direct hit. But the oil city of Beaumont, Texas, and many of the largest U.S. refiners were in Rita's path, and the extent of damage was not yet known.

Texas emergency management officials said they had airborne assessment teams ready to go out and inspect damages as soon as winds died down. At least one energy expert feared the worst, though, given Rita's track and previous intensity.

"It was right up production alley," said Harry Quarls, senior managing director of the global energy practice at Booz Allen Hamilton. "It was a Category 4 and 5 (storm) when it was going through."

I guess insurance companies are off the hook nowdays though. Looks like it is up to us and the government to cover costs ... one way or another.

I personally think the sudden 20 cent per gallon price increase we saw on gas the first day the hurricane existed pretty much covers it.

we'll see ...

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