Chevron Updates Hurricane Impacts
SAN RAMON, Calif., Sep. 6, 2005 -- Chevron (NYSE: CVX) said today that the overwhelming majority of its 4,000 employees in the areas affected by Hurricane Katrina are safe and secure and that business resumption efforts are progressing. Prior to the hurricane, Chevron safely evacuated all of its employees and contractors from offshore facilities in the U.S. Gulf of Mexico.
The company said that well over 90 percent of its employees who work in refining and marketing operations or in onshore exploration and production offices have been contacted. Of the employees who work in association with offshore production facilities, more than 90 percent have been contacted, a task that is difficult given the work schedules and worldwide home locations of these employees. The company said it expects that this number should increase over the next few days as these employees report in for their upcoming work schedules.
To help account for its affected employees, Chevron set up an 800 number, used radio and web communications, and took out newspaper ads. Employees in Louisiana, Mississippi, Alabama or the Florida panhandle affected by Hurricane Katrina are being asked to call 1-800-334-3963 to report their whereabouts and well-being. An operator will take their information.
One week after Hurricane Katrina hit the Gulf Coast, the company returned to 45 percent of its pre-Katrina production level.
Dave O'Reilly, chairman and chief executive officer of Chevron said, "We're very proud of our employees and contractors, many of whom were personally affected by the storm. They have achieved this accomplishment without a single recordable injury while working under extraordinary circumstances. We are continuing to work safely to bring more production online as soon as possible."
Aerial reconnaissance and more detailed onsite inspections indicate Chevron's major Gulf of Mexico deepwater oil and gas production facilities – Genesis, Petronius and Typhoon – did not sustain any significant damage. Genesis and Typhoon have been restaffed, and are producing oil and gas. Petronius is ready to produce once it is safe to export production to associated pipeline infrastructure, where the full extent of damage is still unknown.
Aerial reconnaissance indicates the vast majority of Chevron's oil and gas production facilities on the Gulf of Mexico Shelf were not significantly damaged. Personnel are restaffing these facilities and are working to safely bring more production online as soon as possible. Key to getting these facilities back in production will be the integrity of the oil and gas pipeline systems, onshore terminals, and plants.
A handful of Chevron's other offshore facilities suffered visual damage. Damage assessments are under way with the goal of bringing production back online as quickly as possible.
As to onshore facilities, Chevron's shore bases in Galveston, Texas, and Intracoastal City, La., are fully operational as is the company's aviation facility in Picayune, Miss. While its Leeville, La., shore base sustained some damage, it is capable of supporting some operations. The Venice, La., shore base and a heliport located in Pascagoula, Miss., suffered significant damage and are not operational. These operations are now being conducted out of Theodore, Ala.
Chevron set up an Incident Command Center in Lafayette, La., to safely organize and manage hurricane response and recovery efforts, including coordination and cooperation with federal, state and local authorities that are involved in response and recovery efforts throughout the region.
Initial assessments of Chevron's Pascagoula Refinery show that a dike built following Hurricane Georges in 1998 was successful in preventing catastrophic damage. The breached section of the dike is expected to be repaired this week, but it will be days before a full estimate of damage is known or when operations can be safely brought back online.
One of three Mississippi Power feeder lines was restored on Sept. 5, and limited power has returned to the Pascagoula Refinery. Generators are now in place to power the marketing terminal at the refinery, enabling the company to provide gasoline and diesel products for local emergency services as well as to the 25 Chevron and Texaco service stations that are now open in the Pascagoula area. The company also said that additional company-operated delivery trucks, sourced from California and Florida, are now in Mississippi to support the product resupply efforts.
Hurricane Katrina and the subsequent shutdown of the Colonial and Plantation pipelines have caused product shortages along those pipeline routes where Chevron has terminals and markets. Those pipelines have now begun operations, and Chevron is receiving product at its East Coast terminals. Both pipelines are important for Chevron to resupply its marketing terminals and tanks throughout the region. Chevron and governments at all levels are stressing the need for consumers to conserve fuel, power and other forms of energy as much as possible during this period.
Following the swift action of the various governors and the unprecedented Environmental Protection Agency (EPA) fuel specification waiver implemented last week, gasoline is being brought to supply markets in the East Coast region.
Preliminary information on the Pascagoula shipping channel near the company docks shows that impacts of Katrina were not significant and that the channel should be available soon for shipping traffic. Getting this channel open would allow the company to bring gasoline and diesel supplies into Pascagoula and beyond while refinery operations are being reestablished.
While the company is beginning to set up facilities to bring employees and contractors onsite, its priority remains setting up housing and supplying water, food and clothing. To this end, Chevron is opening an employee temporary housing facility within a few miles of the Pascagoula Refinery with beds for up to 1,500 refinery employees and their families whose homes were destroyed or severely damaged.
To support Chevron employees and the communities in the impacted region, Chevron Corporation pledged an initial $5 million to Hurricane Katrina relief efforts – a $3 million donation to the American Red Cross and an additional $2 million that will be provided to communities along the Gulf Coast. Chevron also helped supply about 2,100 cots, 79 pallets of blankets and hundreds of comfort kits to the relief staging area in Montgomery, Ala., as well as nearly 25,000 cases of water to relief centers with the help of Coca-Cola and the nonprofit America's Second Harvest.
As part of its employee relief efforts, Chevron also established a system on its intranet to facilitate employee offers to help, including rooming accommodations for fellow employees left homeless by the hurricane. In addition, Chevron set up an employee Humanitarian Relief Fund, established to channel individual employee contributions to affected Chevron families.
Chevron's Employee Assistance Program also is being expanded to provide support and counseling services for employees and their family members.
Updated: September 2005