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BP Warns Hurricane Barry Significantly Dented Its Q3 Oil Production

BP warned on Friday that Hurricane Barry, which passed through the U.S. Gulf of Mexico in mid-July, hurt the supermajor’s oil production in the third quarter, cutting it by around 100,000 barrels of oil equivalent per day.

In the middle of July, oil and gas producers shut in as much as 73 percent of the oil production in the Gulf of Mexico as Barry passed through the area.

“BP’s third quarter 2019 production was impacted by turnarounds in some of the highest-margin regions, and output in the US Gulf of Mexico was significantly disrupted by Hurricane Barry, with facilities shut down for around 14 days,” the UK supermajor said in an update on Friday.

“Taken together, these factors impacted BP’s third quarter 2019 production by around 100,000 barrels of oil equivalent per day, with the overall production mix in the third quarter having a higher proportion of barrels produced from higher tax regions,” the company said, noting that further details on Q3 would be delivered in the quarterly financial report on October 29.  

Nearly a decade after the 2010 Deepwater Horizon disaster, BP now bets big on the Gulf of Mexico to grow its global production of ‘high-margin oil’, as its executives say.

Related: PDVSA, Chevron Restart Second Major Oil Blending Facility

BP, the biggest oil producer in the U.S. Gulf of Mexico, has recently announced that it is expanding the development at one of its fields, unlocking additional production from its offshore U.S. platforms, while the American supermajors look to significantly boost their output from the hottest shale play, the Permian.

To be sure, BP has recently secured shale assets in the United States after buying last year oil and gas assets in the Permian, the Eagle Ford, and Haynesville from BHP in what the UK supermajor described as a “transformational acquisition” and one of its biggest deals in the past two decades.  

After this transaction, BP announced a US$10-billion divestment program over 2019 and 2020. In its update today, the oil major said that it now expects the two-year program to be largely agreed by end 2019, ahead of schedule. In August, BP announced the largest single divestment which is expected to complete in 2020—the sale of its Alaskan business to Hilcorp for US$5.6 billion.

By Tsvetana Paraskova for Oilprice.com

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