Possible further disruption to energy supply from TD 20

This morning, the National Hurricane Center (NHC) officially christened Tropical Depression 20, which is foreceast to develop into a tropical storm within 36 hours' time. Below is the NHC 3-day forecast for what may be known next week as Stan:



Now, next to Canada, Mexico is our second-largest foreign supplier of petroleum products (EIA source document) at approx. 1.6 million bpd.

Slightly more than two-thirds (67%) of Mexico's crude output comes from the Bay of Campeche, and in particular, the Cantarell Oil Field...



...which happens to be the forecasted destination of TD#20, which the NHC has forecasted will develop (back?) into a tropical storm once it crosses into the Bay of Campeche, with the potential to develop into a hurricane between Monday and Tuesday evening.

While this will not pose the same threat as did Katrina or Rita, it nonetheless will pose a definite marine hazard (and has already been refelected as such in the "1-2-3 Rule") and potential/probable disruptions in the 1.88 million bpd production and/or supply chain of petroleum production in a time of very tight supply.

At this point in time, every bit further restricted from the supply chain is going to be felt signifcantly more than the raw numbers alone would imply...

[edit on 1-10-2005 by sdrumrunner]

No tropical storm with winds at 30 mph is going to disrupt Pemex production, must of forgot about emily already.

Yep... seems the TAOS model agrees with you, and as you state in the TS Stan post on the same topic, it has forecast 0% disruption.

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[edit on 3/10/2005 by Mirthful Me]

This might interest you in relation to Pemex oil supply:

Pemex Expects to Cancel Oil Exports
Mexican state oil monopoly Petroleos Mexicanos said it expects shipments of 10 million barrels in crude oil exports to be canceled after Hurricane Rita roared through the U.S. Gulf Coast last weekend.

Exxon Mobil Corp. has reportedly declared force majeure on half a dozen cargoes of Mexican Maya crude. Pemex has contracts to send 65,000 barrels daily to Exxon's 557,000 barrels-a-day Baytown refinery, which is still restarting.
more: forbes.com

Mexico drilling rig/workover count:
www.rigzone.com...

Seems Stan won't be a problem since they can't refine or deliver what they already have, due to hurricane Rita.

Originally posted by Regenmacher
This might interest you in relation to Pemex oil supply:

Pemex Expects to Cancel Oil Exports
Mexican state oil monopoly Petroleos Mexicanos said it expects shipments of 10 million barrels in crude oil exports to be canceled after Hurricane Rita roared through the U.S. Gulf Coast last weekend. ...Seems Stan won't be a problem since they can't refine or deliver what they already have, due to hurricane Rita.

Yes, that makes perfect sense. I would say it is fair to assume that Stan's presence will have no additional short-term impact on imports of Mexican petroleum products for this very reason.

I wonder if Pemex has scaled back production in light of this decision? I have been unable to find any current data on this (maybe in the EIA daily briefing later today?).

So, therefore, I would say it is safe to assume the only possible impact that Stan could have on future Mexico imports would be if Stan damages the Mexican production infrastructure, e.g., rigs, pipelines, etc., which as you have pointed out, seems unlikely at this time.

However, one quick note for future reference-- upon revisiting the TAOS model, it seems it models damage estimation to U.S. oil interests only, and is thus of limited use in quantifying estimated damages to Pemex's oil infrastructure.

An additional note on TAOS:

I referenced this experimental model quite frequently with regards to the estimated impact on our oil production facilities in the wake of Rita's path. While its quantification of estaimted damage to individual areas and/or facilities seems rather accurate, the estimated short-term impact on the U.S. GOM petroleum production was far too optimistic -- 66.5% of 58.2% of oil and NG production respectively, when as of last Friday the actual numbers as published in the EIA's daily report were 94% and 76.4%, respectively.

Thus while the model's estimation of "loss of value" due to wind and/or water damage may be accurate, the estimation on impact to GOM production was off by almost 50% -- not exactly accurate, and demonstrative of the model's current limitations.

Well, TD20 did indeed become Tropical Storm Stan



As of Adv10A, issued at 21:00 UTC (5:00 pm EDT), Stan had built sustained winds of 58mph with gusts up to 69mph. And according to the latest AODT analysis, the max. wind speed is now approx. 85 mph (74.6 kt).

The latest NOAA data (as per advisory 10) calls for an extension of top sustained winds 30 miles SE from the storms center, with measured 12' seas extending 45 miles SE out from the center.

And according to an aforementioned experimental damage model, the Bay of Campeche (and thus in all likelihood some of Pemex's GOM operations) is sure enough going to be exposed to damaging conditions:

wind:


wave height (15'-30' waves in store for pretty much the whole bay):

From a CNN.com article published six minuted ago:




"All three of Mexico's Gulf coast crude-oil loading ports were closed Tuesday as a precaution, but the shutdowns hadn't affected the company's production, authorities said...

...The closed crude-oil loading ports -- Coatzacoalcos, Dos Bocas and Cayo Arcas -- handle most of the 1.8 million barrels a day of crude oil exported by state-owned oil monopoly Petroleos Mexicanos, or Pemex.

Five exploratory oil platforms also were evacuated Monday, but so far the storm hadn't affected the company's production of 3.4 million barrels a day of crude oil, Mexico's Communications and Transportation Department said.

Pemex is the world's third-largest oil producer, and most of its exports are sent to the United States.

The port closures weren't expected to affect oil prices. After hurricanes Katrina and Rita crippled many of the U.S. oil refineries, Mexico has had to temporarily scale back its exports to the United States."





No worries then*.







[ Debbie Downer ] *with regards to the aforementioned possible economic impact. This is not to trivialize the pain and suffering endured by the 59 unfortunate persons (or their families) who fell victim to the storm. [/ Debbie Downer]










[edit on 4-10-2005 by sdrumrunner]