Ike Forces Shutdown of 19% of Refining Capacity, Limiting Fuel

Hurricane Ike, which will make landfall along the U.S. Gulf Coast today, caused more than 19 percent of the nations refining capacity to close and may limit fuel deliveries across the country.

At least 13 refineries in Texas were shutting down as Ike approached. Gulf Coast refineries and ports are the source of about 50 percent of the fuel and crude used in the eastern half of the U.S. Plants operated by Exxon Mobil Corp., Valero Energy Corp., ConocoPhillips and Royal Dutch Shell Plc were affected.

Gasoline shortages may occur across the southern U.S. up to Washington because of the closures caused by Hurricane Gustav and now Ike, Kevin Kolevar, assistant secretary for electricity delivery and energy reliability at the U.S. Department of Energy, said on a conference call.

``We expect to see constrained supplies of refined products,'' he said. ``The administration will utilize every tool at our disposal to lessen the likelihood of limited fuel supplies,'' including tapping the Strategic Petroleum Reserve.

Ike bore down on the coast with winds increasing in strength to 110 miles (175 kilometers) an hour. Coastal areas faced a storm surge as high as 25 feet, the National Hurricane Center in Miami said on its Web site.

The storm idled about 98 percent of oil production and 94 percent of natural-gas output in the Gulf of Mexico, the U.S. Minerals Management Service said yesterday. Gulf fields produce 1.3 million barrels oil a day, about a quarter of U.S. output, and 7.4 billion cubic feet of gas, 14 percent of the total, government data show.

Refinery Issue

``This is more of a refinery issue than an oil and gas issue,'' said Jim Rouiller, senior energy meteorologist at Planalytics Inc. in Wayne, Pennsylvania. ``A storm as massive as Ike has the capacity to generate massive storm surge.''

Gasoline for October delivery rose 2.08 cents, or 0.8 percent, to settle at $2.7696 a gallon yesterday on the New York Mercantile Exchange as the refineries closed. Prices rose 3.1 percent this week.

Chevron Corp., the second-largest U.S. energy company, urged U.S. consumers outside the Gulf Coast region to conserve gasoline and other fuels to help avert shortages.

The company, in a statement on its Web site, said it's concerned about ``the potential impact of Hurricane Ike and the additional pressure it could have on an already stressed petroleum-distribution system.''

Baytown Closure

Exxon Mobil is shutting its Baytown, Texas, refinery, the biggest in the U.S, with processing capacity of 590,500 barrels of oil a day, and its Beaumont plant, which can process 363,100 barrels a day, according to the Energy Department. Exxon is the world's largest oil company.

Valero, the largest U.S. refiner, closed three Texas oil refineries with a combined capacity of 589,000 barrels a day. They are the 294,000-barrel-a-day Port Arthur refinery, a Texas City plant with a capacity of 210,000 barrels and a Houston facility that can process 85,000 barrels, spokesman Bill Day said in an e-mail.

Earlier today, Valero closed 64 company-operated retail stories out of almost 200 in the Houston region, Day said.

Motiva Enterprises LLC, a joint venture of Royal Dutch Shell Plc and Saudi Arabia's state oil company, started shutting down its 300,000-barrel-a-day plant in Port Arthur, Shell said on its Web site. Shell is also closing its Deer Park plant, which can process 340,000 barrels per day.

Motiva's Beaumont, Pasadena and North Houston terminals are also closed and refined product supplies at those terminals remain at ``safety levels,'' Shell said in a statement. Tank drivers earlier picked up their last loads and are making final deliveries in the region to refuel Shell-branded stations before Hurricane Ike makes landfall.

Corpus Christi

Citgo Petroleum Corp., owned by Venezuela's state oil company, declined to comment on the status of its refineries in Corpus Christi, Texas, and Lake Charles, Louisiana.

``We do not comment on operations,'' spokeswoman Shawn Trahan said in an e-mail.

Planalytics' Rouiller said Ike is similar to Hurricane Alicia in 1983.

``It took them over a year to get their feet on the ground again,'' he said. ``The refineries were down for months. Basically, the whole infrastructure around the Houston metropolitan area was devastated.''

Gasoline supplies across the southern and eastern U.S. may be disrupted by the storm, Rouiller said.

``We could have this capability lost for a long period of time,'' he said.

Houston Port

The U.S. Coast Guard closed the port of Houston, the nation's largest petroleum port. The Louisiana Offshore Oil Port, the biggest U.S. oil-import terminal, stopped unloading vessels.

BP is closing its 475,000-barrel-a-day Texas City, Texas, refinery. ConocoPhillips, the second-largest U.S. refiner, said its 260,000 barrel-a-day refinery in Sweeny, Texas, is closing. LyondellBasell Industries is shutting its 299,300-barrel-a-day Houston Refining LP plant.

Conoco's Pasadena, Texas, refined products terminal and Clifton Ridge Marine terminal near Lake Charles also closed earlier today, and all company-operated pipelines in the region are shut down.

LyondellBasell Industries is shutting its 299,300-barrel-a- day Houston Refining LP plant.

Marathon Oil Corp., the fourth-largest U.S. oil company, began to shut its Texas City refinery, which can process about 81,500 barrels of oil a day.

Port Arthur

Total SA, Europe's third-largest oil company, is shutting down its Port Arthur refinery, which can process about 240,000 barrels a day.

``Ike is headed into the heart of the refining industry,'' Bruce Bullock, director of the Maguire Energy Institute at Southern Methodist University in Dallas, said in an interview. ``The damage is likely to come in flooding, a lack of power for an extended period of time.''

Dixie Chicks, Hockey Games Could Figure in Next Congressional Scandal

Dixie Chicks concert tickets, ringside hockey seats and a private suite at Camden Yards. These are just a few of the gifts lobbyists allegedly gave a top lawmaker and his staff in exchange for help securing earmarks and other political favors for their clients -- a relationship that could lead to criminal charges against this Republican heavyweight, new court papers show.

Tickets to Dixie Chicks concerts and other gifts could figure in another congressional investigation.

(Randall Michelson/WireImage/Getty Images)

The details are part of a 10-count indictment released today against former lobbyist and Capitol Hill staffer Kevin Ring that sheds new light on the alleged involvement of Rep. John Doolittle (R-Calif.), who is not running for reelection, in the wide-ranging influence peddling investigation stemming from the activities of now-convicted lobbyist Jack Abramoff.

Ring, 37, was arrested Monday and pleaded not guilty in federal court in Washington D.C. to the charges, which include conspiring with Abramoff to influence public officials through gift giving and skirting disclosure requirements.

The document also highlights contacts between Abramoff and former Rep. Ernest Istook (R-Ok.) -- identified only as Representative 4 -- whose chief of staff plead guilty to taking gifts while securing a series of earmarks for Abramoff's clients.

The 46-page document appears to show how Doolittle -- identified only as Representative 5 -- helped Abramoff's team win earmarks and funding while the congressman and his staff took numerous gifts and fundraisers from Abramoff and his team.

Though the members' names are not in the documents, it gives enough information to make them clearly identifiable. Representative 4 is identified as the member now convicted Capitol Hill staffer John Albaugh worked for. Albaugh served as chief of staff to former Rep. Istook, who left office in 2006 to make an unsuccessful bid for governor. He is now a fellow at the conservative Heritage Institute in Washington D.C.

Representative 5 is listed as a member from California since 1993 who opposed gambling. Rep. Doolittle was elected to the 4th congressional district in California in 1993 and has opposed gambling. Ring is also a former Doolittle staffer.

Both members have adamantly denied any involvement in the scandal.

A statement released today by Doolittle's lawyer said the details of the indictment seemed intended only to "titilate the public." It continued: "Not once in this document does the Department of Justice allege any sort of illegal agreement between Congressman Doolittle, on the one hand, and Kevin Ring or Jack Abramoff, on the other. To the extent the Indictment can be read to imply such an agreement, the Congressman continues to steadfastly maintain there was none and that he is innocent."

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Texas expects major hit from Hurricane Ike

Voluntary evacuations were under way along the Texas Gulf Coast on Tuesday as officials prepared for a potential multibillion-dollar disaster when Hurricane Ike reaches the Gulf Coast later this week.

As many as 1,000 evacuees were expected to begin arriving as early as Wednesday morning in Lubbock, in the northwest corner of the state, after Gov. Rick Perry declared emergencies in 88 counties and placed 7,500 National Guard troops on alert.

They were expected to overflow the capacity of the city’s Coliseum, which was set up as an evacuation center. Officials put out a call for volunteers to help with the flow of evacuees and were planning to set up a second location in the city’s Civic Center, said Kevin Overstreet, Lubbock’s emergency management director.

At 11 p.m. ET, Ike had entered the Gulf of Mexico as it moved away from Cuba, where it left a double trail of destruction. The storm was centered 120 miles west of Havana and was moving west-northwest near 9 mph, with maximum sustained winds near 80 mph.

Forecasters said it would strengthen, perhaps to a Category 3 storm with winds over 110 mph, before hitting the Texas coast late in the week.

“When it’s out of Cuba, it has the potential to become a lot stronger,” said Felix Garcia, a meteorologist at the National Hurricane Center in Miami.

‘Worst-case scenario’
Current projections placed Ike crossing the Texas coast Friday night or Saturday morning near Corpus Christi, where Nueces County officials convened an emergency planning call Tuesday. The county, which has no permanent shelters, began bringing in buses and ambulances to handle evacuations expected later in the week.

In Louisiana, where thousands of homes remained without power after Hurricane Gustav hit last week, Gov. Bobby Jindal urged residents to start stockpiling food, water, batteries and other supplies in case the hurricane veered east. The state also was readying shelters and making plans for trains, buses and planes in case a coastal evacuation is called later in the week.

Local authorities and insurance officials warned that Ike could be shaping up as the “worst-case scenario.” Galveston Mayor Lyda Ann Thomas said her city was using models of the catastrophic 1900 hurricane, which killed at least 6,000 people, in its planning for Ike.

“It’s the storm we’ve talked about but hoped would never happen,” said Mark Hanna, a spokesman for the Insurance Council of Texas. If Ike were to strike Galveston and then enter the Houston Ship Channel, damage “would rival hurricanes Andrew or Katrina,” he said.

Jim Oliver, general manager of the Texas Windstorm Insurance Association, said the agency’s insurance exposure in Galveston County alone was more than $18 billion.

“Nobody will be ready if a Category 3 or worse hits,” he predicted.

Texas prepares for evacuations
Officials of the Federal Emergency Management Agency said it was too early to recommend evacuations along the Gulf Coast, but they said they would have a much clearer picture as early as Wednesday.

In Texas, officials were taking no chances. State transportation officials began establishing evacuation routes from the coast to North Texas, where the Dallas Convention Center was designated as the region’s primary evacuation center.

A state fuel team was dispatched to trace the routes toward Dallas, making sure enough gasoline would be available for the tens of thousands of vehicles that may travel the roads. Meanwhile, Texas officials contacted their counterparts in Oklahoma to arrange emergency shelter for 12,500 patients with special medical needs.

In Louisiana, many residents and businesses were not even bothering to take down the boards they put up ahead of Hurricane Gustav early last week.

“We left them up just in case — we’re unsure about the other storms that are out in the gulf,” said Nancy Jordan of Lake Charles.

“It’s just hard to believe that we’re going to have to do this again,” she said. “I know that a lot of people in the community have struggled financially with having to evacuate, but I think we have to in order to be safe.”

Hurricane Ike slams Cuba, roars into Gulf of Mexico

Hurricane Ike moved into the warm waters of the Gulf and took aim at the U.S. and Mexican coasts Tuesday after bringing down aging buildings in Havana and tearing through western Cuba's tobacco country.

Forecasters said Ike, which has already killed at least 80 people in the Caribbean, could strengthen into a massive Category 3 storm before slamming into Texas or Mexico this weekend.

STORM TRACKER: Ike's current position, forecast path

PHOTO GALLERY: 2008 hurricane season

Some 1.2 million people — more than a tenth of Cuba's population — sought refuge from Ike, which killed four people and shredded hundreds of homes as it barreled across the island.

Winds howled and rains lashed the empty streets of Havana as towering waves broke over the seaside Malecon promenade, devoid of the bustling crowds of Havana residents who normally fish and chat by day and drink and socialize at night. Navigation was banned in Havana Bay, its usually placid surface stirred up by white-capped waves.

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