Gulf Coast Oil Firms Return to Ida Recovery as Storm Nicholas Recedes

Energy companies worked to restore pipeline service and electricity after Tropical Storm Nicholas passed through on Tuesday, allowing them to return to repairing the significant damage caused by Hurricane Ida two weeks ago.

Nicholas, downgraded to a tropical depression late Tuesday, caused rain, flooding, and power outages in Texas and Louisiana, where some refineries remained offline in the wake of Hurricane Ida. The earlier storm shuttered most U.S. Gulf offshore oil and gas production.

Colonial Pipeline, the largest U.S. fuel line, resumed partial operations Tuesday after Nicholas passed, and the company said it would restore service on its distillate line as quickly as possible.

Royal Dutch Shell halted production at its Perdido offshore oil platform due to heavy winds caused by Nicholas, and U.S. liquefied natural gas producer Freeport LNG said processing at its Texas coast facility was halted, likely due to a power outage.

Nicholas caused widespread power outages as it crossed over the Houston metropolitan area late Monday night and early Tuesday morning, but utilities restored power for over 400,000 customers during the day on Tuesday.

The storm surge along the coasts of northeastern Texas and Louisiana was expected to diminish by Wednesday morning, according to the National Hurricane Center.

More than 39% of the U.S. Gulf of Mexico's production of crude and natural gas remained shut on Tuesday, offshore drilling regulator Bureau of Safety and Environmental Enforcement (BSEE) said, following Hurricane Ida's passage through Louisiana.

About 720,000 barrels per day (bpd) of crude production and 1.075 billion cubic feet per day of gas were offline, while 39 production platforms continued to be evacuated.

Major oil refineries in Louisiana were working to restart after Hurricane Ida, including Valero Energy Corp's refineries in St. Charles and Meraux and PBF Energy's refinery in Chalmette.

(Additional reporting by Laura Sanicola, Liz Hampton, Swati Verma, and Arpan Varghese; Editing by David Gregorio, Nick Zieminski and Karishma Singh)