Economic Calendar

Thursday, September 11, 2008

Hurricane Ike Churns Toward Texas as Houston Calls Evacuation

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By Brian K. Sullivan and Camilla Hall

Sept. 11 (Bloomberg) -- Ike grew into a ``large'' hurricane as it churned across the Gulf of Mexico toward Texas, prompting coastal evacuations and the shutdown of oil platforms and refineries.

Galveston and parts of Houston south of the city and near the coast will be under a mandatory evacuation order starting at noon local time, city officials said at a press conference today. The area may see a storm surge of as much as 15 feet (4.6 meters).

``Ike is growing to a very large hurricane right now with a very large wind field,'' said Jim Rouiller, a meteorologist with Planalytics Inc. in Wayne, Pennsylvania. ``In the next 24 to 36 hours, as Ike makes his play for the Texas coast, he will intensify to a major hurricane.''

The center of Ike's hurricane-force winds has more than tripled in size since yesterday, according to the Miami-based National Hurricane Center. The system's strongest winds now extend outward as far as 115 miles (185 kilometers), up from 35 miles yesterday.

Ike was a Category 2 hurricane with sustained winds of 100 mph, up from 80 mph yesterday, the center said in an advisory at 7 a.m. Houston time.

The center's forecasters said Ike may strengthen to at least a major hurricane with Category 3 intensity, meaning sustained winds of at least 111 mph, in the next day or two. Other forecasters predict Ike may become a Category 4 storm, the second-strongest on the five-step Saffir-Simpson scale, packing winds from 131 to 155 mph.

Missing Oil Fields

The storm is forecast to sweep through the center of the Gulf, missing the offshore Louisiana oil and natural gas fields. The Gulf is home to about a quarter of U.S. oil production.

Still, about 96 percent of all oil production in the Gulf has been shut in along with 73.1 percent of natural gas facilities, according to the Minerals Management Service, a bureau of the U.S. Department of the Interior.

Rouiller said the storm surge may do some damage to Galveston, a coastal city near Houston.

``I am worried that Galveston Bay in particular will be in the right front quadrant of it,'' Rouiller said by telephone.

President George W. Bush declared an emergency for Texas, his home state, and Governor Rick Perry readied 1,350 buses to evacuate residents in preparation for Ike's landfall. As many as 7,500 Texas National Guard members are on standby. Ike may cross the central Texas coast southwest of Galveston Bay early Sept. 13, the National Hurricane Center said.

New Orleans Warning

The New Orleans area, including Lake Pontchartrain, was under a tropical-storm warning for Ike. That means such conditions, with sustained winds of 39 to 73 mph, are expected within 24 hours. The warning stretches along the coast from Cameron, Louisiana, east to the Mississippi-Alabama border.

New Orleans, which was devastated by Hurricane Katrina in 2005, was spared the worst of Hurricane Gustav when it struck the state last week. Gustav killed 25 people in Louisiana.

A hurricane watch was in place from Cameron, Louisiana, west to Port Mansfield, Texas. The watch means hurricane conditions, with sustained winds of at least 74 mph, are possible within 36 hours.

Officials in Corpus Christi, a city of about 277,000 people, yesterday advised people to evacuate.

Voluntary Evacuations

Voluntary evacuations are also in effect for San Patricio, Aransas and Victoria counties and parts of Jackson County. Officials have ordered mandatory evacuations for Brazoria and parts of Matagorda County, according to Perry's office.

The potential for destruction from Hurricane Ike has caused oil refiners to begin shutting plants near Houston and producers to evacuate platforms in the Gulf.

Along the Texas coast, major U.S. refineries are in the path of the storm. Exxon Mobil Corp.'s Baytown facility, 17 miles east of Houston, is the country's biggest, with a capacity of 586,000 barrels a day. In Texas City, BP Plc has a 475,000 barrel-a-day refinery. Royal Dutch Shell Plc, Total SA and Valero Energy Corp. also have refineries in the vicinity.

The Louisiana Offshore Oil Port, which is the biggest U.S. oil-import terminal and handles 13 percent of imports, said it closed marine operations because of Ike.

Crude oil for October fell 0.5 percent to $102.03 a barrel on the New York Mercantile Exchange.

To contact the reporters on this story: Brian K. Sullivan in Boston at bsullivan10@bloomberg.net; Camilla Hall in London at chall24@bloomberg.net




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