(New throughout, adds impact on exports)
By Arathy S Nair and Sabrina Valle
HOUSTON, Sept 20 (Reuters) - Royal Dutch Shell, the
largest U.S. Gulf of Mexico oil producer, said damage to
offshore transfer facilities from Hurricane Ida will cut its
production into early next year, slashing deliveries of a type
of crude oil prized by refiners.
Shell was the hardest-hit producer from Ida, which tore
through the U.S. Gulf of Mexico last month and removed 27
million barrels overall from the market. About 40% of Shell's
production from the offshore region remains offline, and the
slow restart has hampered export activity in general.
The Gulf contributes about 16% of U.S. oil production, or
1.8 million bpd. Shell is the largest U.S. Gulf of Mexico oil
producer with eight facilities pumping about 476,000 bpd,
according to Rystad.
Shell's damaged transfer facility, West Delta-143, carries
oil and gas from three major fields for processing at onshore
terminals. The company previously suspended numerous contracts
to supply crude from the fields, citing hurricane losses.
Rystad Energy analyst Artem Abramov estimated the lost
production will remove 200,000 to 250,000 barrels per day (bpd)
of Gulf of Mexico oil supply for several months.
"Disruptions are now having an impact on total available
crude for export from the U.S., not just the offshore grades,"
said Krista Kulh, a Houston-based analyst with consultancy firm
Facts Global Energy.
The fields are a key source of Mars sour crude, a grade
prized by oil refiners in the United States and Asia. Mars
prices had soared to a one-year high earlier this month then
eased as other oil supply constraints lifted.
"Based on current pricing there is likely to be much less
crude exported," Kuhl added.
A Shell spokesman declined to comment further.
Shell's Mars and Ursa oilfields which supply about 200,000
bpd combined would be affected into the first quarter of next
year. The third oilfield, Olympus, produces about 100,000 bpd
and will be able to resume production sometime in the fourth
quarter, Shell said.
Damage to the transfer station pushed up price of Mars crude
earlier this month to a more than one-year high and threatened
September-October exports.
U.S. crude oil prices fell about $1 a barrel on
Monday over worries about a Chinese real-estate developer's
solvency and a U.S. Federal Reserve Bank meeting this week that
could see less lenient lending terms.
(Reporting by Arathy S Nair in Bengaluru; Editing by Aditya
Soni, Nick Macfie and David Gregorio)