Friday, September 30, 2005

Rig Damage

There have been alot of reports on the rig damage due to the hurricanes. Everything I'm reading is not good news....which is why even Bush came out asking people to conserve. I hope I'm wrong, but energy shortages over the next six months to a year may be the big story. And this is not just gasoline, but natural gas may be even worse.

The pictures I've included are of two rigs that are "beached". From an "insider":
You might also point out that in order to beach one of these rigs, ALL THREE of their 150’ legs must be broken off by the storm. So to fix these rigs, they would require 3 new legs, a new derrick, a new block and draworks, repair of everything broken….it is most likely that they will be scrapped or at a minimum, stripped to the hull and rebuilt. Rebuild will take longer than building a new rig because of inspections and removal of damaged stuff, but with material costs high, it may be viable.
The rest of the post is quite informative, talking about exactly why rigs are built to only withstand a category 3 hurricane (hint $$$$). It's a good read if you're an energy junkie.

The point of this post is that it's gonna take a long time to repair the hurricane damage done to the energy sector of 25% or more of American domestic oil and natural gas supplies. This is gonna hurt.


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