Senior Bush administration officials touring the Gulf Coast area devastated by Hurricane Katrina expressed concern Tuesday about possible shortages of natural gas, saying that the region’s production may not recover for months.
Energy Secretary Samuel Bodman said there is less known about the damage to the natural gas supply system than about the effect on crude oil production. He said in addition to possible pipeline damage, the hurricane also shut down gas processing facilities on-shore.
“The great concern is about natural gas,” Bodman told reporters as he flew to Louisiana from Houston.
Interior Secretary Gail Norton, who accompanied Bodman, said that 90 percent of the Gulf oil platforms “will be capable of production by the end of the month.” But she said damage to on-shore facilities is expected to keep oil production down.
Norton said that 58 percent of Gulf oil production remains shut down, as does 38 percent of the region’s natural gas production.
“But there is more concern about gas because we don’t have an international market” that the country could rely on for additional supplies as it does with oil, she said.
Last week, the Energy Information Administration estimated that natural gas prices would soar this winter because of the hurricane, including increases as much as 71 percent in parts of the Midwest.
Bodman and Norton were to visit the government’s Strategic Petroleum Reserve facility near Baton Rouge. The government is already supplying oil to some refineries from the reserve on a loan basis.
Later the two Cabinet secretaries were to tour an Exxon Mobile refinery near Baton Rouge that escaped damage from the hurricane but had to scale back production because of the shortage of crude oil. The refinery has since resumed production using SPR supplies.
Bodman and Norton met with senior executives from two dozen energy companies Monday evening in Houston. The executives said they needed government help in arranging for housing for thousands of employees as they struggled to return the Gulf’s oil and gas system to full operation, he said.
