Ben Raines / Katrina Pours

Sunday, August 28, 2005
By BEN RAINES
Staff Reporter

Oil traders closed business on Friday confident that Hurricane Katrina would hit too far to the east to affect the price of oil and natural gas.

That was before the National Hurricane Center shifted the storm's possible path to a more westerly track that slices through the nation's main oil artery and could result in record prices for a barrel of crude within a matter of days.

If Hurricane Katrina holds true to predictions and tracks north through the toe of Louisiana's boot, much of the nation's oil and natural gas infrastructure will be exposed to 140 mile per hour winds, 30- to 50-foot waves, and water current speeds of around 20
knots all the way from the surface to the sea floor.

"This storm is going to pass through the meat of the oil and gas fields. The whole country will feel it, because it's going to cripple us and the country's whole economy," said Capt. Buddy Cantrelle with
Kevin Gros Offshore, which supplies rigs via a fleet of large crew vessels.

The equipment located in the storm's likely path includes the bulk of the nation's oil and gas production platforms, thousands of miles of
pipelines and -- perhaps most importantly for national gasoline prices -- much of the country's refinery capacity. In addition, the south Louisiana coastline serves as the entry point for around a third of the nation's imported oil.

Last year's Hurricane Ivan, which came ashore along the Alabama- Florida line moving through an area mostly devoid of rigs, caused widespread destruction both above and below water in the fields off Alabama and eastern Louisiana. Floating rigs were found drifting
hundreds of miles from the wells they had been plumbing, while some rigs with legs fixed to the bottom toppled into the sea. Hundreds of millions of dollars worth of pipelines were tangled and torn to pieces by sea currents and massive underwater mudslides.

The full extent of the damage wasn't known for days and the Gulf lost nearly 30 percent of production capacity for well over a month, which drove prices for oil up $12 a barrel within a few weeks. Prices for
both oil and natural gas surged upward and stayed high for months.

But that storm was just a baby tap on the Gulf's infrastructure compared with the blow some in the oil industry are predicting from Katrina.

"No matter where it hits at this point, it's going to hit a lot of rigs, and the whole country is going to notice," Cantrelle said. "And if this thing comes up through Port Fourchon like they're calling for
right now, well, that's where 30 percent of the country's oil comes ashore. They are forecasting 40-foot seas for Fourchon."

Port Fourchon, located at the tail end of a barely there two-lane highway just a foot or two above sea level, sits exposed to the sea almost like an island lighthouse thanks to the loss of thousands of
acres of marsh that once surrounded it. The port complex -- like that skinny strip of a highway now so low and close to the water that fishermen use parts of the shoulder as a miles-long boat ramp -- has
been rendered ever more vulnerable by the massive erosion of Louisiana's coastal marshes.

"A storm of this magnitude, we're expecting some serious damage here," C.J. Cheramie with the Fourchon Port Police said Saturday afternoon. "They started evacuating the rigs once the storm got into
the Gulf. We haven't seen any helicopter traffic in awhile, suggesting that everyone has made it in. We are evacuating inland. We'll try to reopen the port as quickly as we can. ... there's just no way to predict what will happen with a storm this size."

Cheramie said he hadn't heard about a helicopter crash reported earlier in the day. Cantrelle, with the crew boat company, told the Register that one of his boats picked up all three passangers unharmed after their copter was forced to ditch into the ocean on its
way back to shore.

Thousands of the 5,000 rig platforms in the Gulf are located in the predicted path of the storm, and many of them are aging. In previous storms, it has been the older rigs that most often end up wrecked.

"Lot of these jack-up rigs, we've been towing them around for 25 or 30 years. These things are getting to be pretty old," said Bobby Autin, with Louisiana International Marine, a rig towing company. "The storm shifted so fast nobody really had a chance to do much but get the people off the rigs. We didn't move any. I sent all of my boats to Texas."

Autin said that as soon as Katrina makes landfall he will scramble his boats back toward Fourchon because he expects there will be a lot of work.

"There are always going to be rigs in trouble after a storm like this. We may have to tow some, or some we will even hold in place if they've tipped over until they can get to them to work on," Autin said. "We were all stunned earlier this year by Cindy when it came
through. It was just a tropical storm and it did a lot of damage offshore. They're saying this storm is on the same track. Imagine what it's going to be like if a category 5 comes rolling through these rigs."