Hello

If I were you, I would FILL-UP, and top off the
tank with gas. Notice in the story below,
"Valero Energy Corp". Heading out on Charlotte
Pike to get my tank full.

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FROM:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aT_OIrdDoBkA&refer=home

Gustav May Hit Gulf Platforms Harder Than Katrina (Update3)

By Jim Polson

Aug. 31 (Bloomberg) -- Hurricane Gustav threatens to hurt
U.S. oil and natural-gas production and refining more
severely than hurricanes Katrina and Rita did three
years ago.

Gustav, downgraded to a Category 3 storm by the National
Hurricane Center in Miami this morning, may strengthen
to Category 4 later today and will make landfall as a
``major'' hurricane. The storm shut three-quarters of
oil output in the region and refineries operated by
Valero Energy Corp., the largest U.S. refiner,
ConocoPhillips, Marathon Oil Corp. and Exxon Mobil Corp.
There will be a special trading session today at the
New York Mercantile Exchange.

``This storm will prove to be a worst-case scenario for
the production region,'' Jim Rouiller, senior energy
meteorologist for Planalytics.com, said yesterday in an
e-mailed message. ``This storm will be more dangerous
than Katrina.''

The center issued a hurricane watch from High Island,
Texas, to Florida at 2 a.m. today. Gustav's winds were
estimated at 150 miles (240 kilometers) per hour as it
made landfall in western Cuba. While they slowed to 125
miles per hour this morning, the storm is forecast to
gain strength as it passes into the central gulf today.
Gustav was 425 miles southeast of the Mississippi River's
mouth and traveling northwest at about 15 mph at 4 a.m.

BP, Exxon, Shell

BP Plc, Exxon Mobil and Royal Dutch Shell Plc, Europe's
largest oil company, led producers shutting wells and
whisking staff ashore. About 77 percent of Gulf oil
output and 37 percent of natural-gas production was
shut, the U.S. Minerals Management Service said in a
statement yesterday. The Louisiana Offshore Oil Port,
the nation's largest crude-oil terminal, closed yesterday.

The New York Mercantile Exchange announced an extended
trading session beginning at 2:30 p.m. today because of
Gustav.

Fields in the Gulf produce 1.3 million barrels a day of
oil, about a quarter of U.S. production, and 7.4 billion
cubic feet a day of natural gas, 14 percent of the total,
government data show. Hurricane Katrina in 2005 closed
95 percent of regional offshore output and, along with
Hurricane Rita, idled about 19 percent of U.S. refining
capacity.

Exxon Mobil is shutting its Chalmette, Louisiana,
refinery. Nonessential employees have been released so
they can evacuate as requested by local officials,
Irving, Texas-based Exxon Mobil said in a notice posted
on its Web site yesterday.

Refineries Shut

The refinery, which can process 192,000 barrels a day,
is run by Chalmette Refining LLC, a joint venture
between Exxon and state oil company
Petroleos de Venezuela SA.

ConocoPhillips, the second-largest U.S. refiner, began
shutting down two refineries in Louisiana that together
process almost 500,000 barrels a day of crude oil, the
company said in a statement posted on its Web site late
yesterday.

Marathon Oil Corp. began closing its 256,000-barrel-a-day
Garyville, Louisiana, refinery, yesterday, according to a
statement posted on its Web site. Valero was shutting
its St. Charles refinery west of New Orleans and may
decide today whether to shut its Port Arthur, Texas,
refinery, spokesman Bill Day said in an e-mailed message.

Three Louisiana parishes with refineries have ordered
mandatory evacuations.

Refinery production slowed at some complexes owned by
Shell and Motiva Enterprises LLC, its venture with Saudi
Arabian Oil Co., Shell said in a statement on its
Web site.

Market Concern

``The big question for the market is going to be how
quickly after Gustav passes will the industry be able
to recover and get back online,'' said Andy Lipow,
president of Houston- based Lipow Oil Associates LLC.

Enbridge Inc., Canada's largest pipeline company, and
its U.S. affiliate closed conduits capable of bringing
ashore 6.7 billion cubic feet a day of natural gas.
Evacuation of Terrebonne Parish shut 550 million cubic
feet a day of gas flow into the 10,500-mile
(16,900-kilometer) Transco line to the U.S. northeast,
owner Williams Cos. said in a statement.

Exxon Mobil said yesterday it had shut platforms
producing 5,000 barrels of oil and 50 million cubic
feet of natural gas.

BP, Europe's second-largest oil company, said it
shut Gulf production and evacuated all staff by
noon local time yesterday. Its normal production is
equivalent to 290,000 barrels a day from the region.

Anadarko Petroleum Corp., the second-largest U.S.
independent oil producer, said in a statement on its
Web site yesterday that it had shut the equivalent
of 105,000 barrels a day of production, with all of
it to be closed tonight.

Workers Evacuated

Shell said it would shut daily production equivalent
to 510,000 barrels of oil yesterday.

Workers from 45 rigs and 223 production platforms were
evacuated as of 12:30 p.m. yesterday, the Minerals
Management Service said in a statement on its Web site.
About 998,000 barrels of daily oil production have
been halted in preparation for the storm, as well as
2.75 billion cubic feet of gas.

Crude oil futures on the Nymex fell 13 cents to $115.46
a barrel on Aug. 29 on speculation supplies will be
adequate to meet demand after the storm passes.
Natural gas futures fell 10.7 cents to $7.943 per
million British thermal units.

Most U.S. financial markets are closed until Sept. 2
for the Labor Day holiday. Nymex said in an Aug. 29
statement that electronic trading will begin at
2:30 p.m. New York time today with trades dated
Sept. 2.

The Louisiana Offshore Oil Port shut at 9:30 a.m.
local time yesterday.

``It's time to get our people off the offshore platform,
'' spokeswoman Barbara Hestermann said yesterday in an
interview.

Shipments to customers continue from the port's 53
million barrels of storage on shore, she said.

Katrina, Rita

Hurricanes Katrina and Rita in 2005 cut supplies for
months. About 27 percent of Gulf oil production and
19 percent of gas output was still shut in January
2006, the Minerals Management Service reported.

Rising waters from a Category 4 storm can cut escape
routes as early as five hours before landfall, with
flooding as much as six miles inland. The coastal
storm surge may reach 18 feet, and the winds can
rip away roofs and walls of homes, according to the
National Hurricane Center.

A Category 5 storm can destroy the roofs of industrial
buildings, flatten all trees and homes, and drive a
storm surge above 18 feet. Only three Category 5
storms, Andrew in 1992, Camille in 1969, and the Labor
Day Hurricane of 1935, have made landfall in the U.S.
since record-keeping began.

At its forecast track and intensity, Gustav would
drive a 20-foot storm surge topped by heavy waves
across southeastern Louisiana, Rouiller of
Planalytics.com said. ``The untested levees at New
Orleans will be overwhelmed and may fail.''

A second Atlantic cyclone, Tropical Storm Hanna, was
moving west-northwest to the Turks and Caicos Islands
of the Caribbean without intensifying, the National
Hurricane Center said.

To contact the reporter on this story: Jim Polson
in New York at jpolson@bloomberg.net.

Last Updated: August 31, 2008 08:23 EDT

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