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Factbox: Hurricane Dorian causes power outages as it advances on US Southeast

New York — Hurricane Dorian was nearing Florida's East Coast Monday afternoon, causing power outages and port closures in the state. While the Category 4 hurricane was no longer expected to hit central Florida, the storm was forecast to remain offshore and move slowly up the US Southeast coastline, approaching the South Carolina coast by Thursday morning and threatening coastal energy infrastructure along the way.

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By Monday afternoon, Florida's major utilities had reported customer outages numbering in the low- to mid-hundreds collectively. Dorian had yet to impact petroleum trade flows, apart from increased gasoline buying ahead of the storm, which caused some retail shortages in Florida.

With Dorian now steering clear of Gulf of Mexico oil and gas offshore production facilities, oil markets will focus primarily on any impacts to consumption. ICE RBOB gasoline crack spreads have weakened in recent days at least in part on expectations of lower driving demand along portions of the US Southeast.

Click here for full-size map

POWER

**Florida's major utilities -- Florida Power & Light, Duke Energy Florida, Gulf Power, Tampa Electric and Jacksonville Electric Authority -- had reported customer outages numbering in the low- to mid-hundreds collectively by around 2 p.m. ET.

**Utilities are holding daily mutual assistance coordination calls and mutual assistance crews are pre-positioning throughout the potentially impacted region from over 36 states, the District of Columbia, and Canada to support restoration efforts post-storm, the Department of Energy said.

**Hurricane Irma, which made landfall on the southwestern side of the Florida Peninsula as a Category 3 hurricane on September 10, 2017, had a significant, but brief, impact on power load. Load initially fell about 40% on September 10, followed by a 63% drop, from the prior seven-day average, on September 11 and then a slow recovery over the following two days.

**Based on Florida load data for August 27, which totaled 783,745 MWh, a similar drop in load would amount to a 24-hour total of about 493,688 MWh.

**Florida Power & Light, which serves roughly 5 million customers, said Sunday it had mobilized a 16,000-person restoration workforce to operate from 24 staging areas across its 27,650-square-mile service territory.

**FP&L has two nuclear plants, each with two units, on south Florida's Atlantic Coast: the 1,770 MW Turkey Point plant in Homestead; and the 2,213 MW St. Lucie plant in Jensen Beach.

**FP&L designated on Friday its "storm riders" who will man its St. Lucie plant prior to the arrival of hurricane winds and remain at the facility during the entirety of the storm.

**The two reactor facility has weathered three severe hurricanes, including Matthew in September 2016, Jeanne in September 2004 and Frances in August 2004.

**It is a regulatory requirement that US nuclear units must shut at least two hours before the projected arrival of hurricane-force winds, those over 74 mph. Nuclear reactors are protected against extreme winds, including tornado-strength gusts, but shut as a protective measure in case off-site power is lost.

**FP&L has become Florida's largest generator of solar energy, with more 1,250 MW of capacity installed at 18 facilities throughout its service territory as of May 2019. Dorian could provide a stern test of solar generation's resilience in the face of hurricane-strength winds.

**Duke Energy Florida has a customer base in Florida that comes to around 1.8 million spread out over 35 counties.

**Duke Energy Florida owns and operates 19 natural gas, solar and coal plants, generating more than 10,000 MW. Three of Duke's largest facilities in Florida are the 1,632-MW, gas-fired Citrus County plant, the 1,422-MW Crystal River coal-fired plant and the 2,045-MW Hines gas-fired plant.

**Duke Energy said Monday it had 6,500 crew members in place to support restoration, including employees from the Midwest and the Carolinas.

**Gulf Power serves roughly 450,000 customers in eight counties throughout Northwest Florida. The company was acquired in January by NextEra, the parent company of FP&L.

**Tampa Electric serves 765,000 electricity customers in West Central Florida. The company owns three power plants capable of generating more than 5,000 MW.

NATURAL GAS

**Southeast demand for natural gas from the power sector took a large hit Monday, with regional burns falling 0.7 Bcf/d day-over-day to 10.8 Bcf/d, according to S&P Global Platts Analytics. Platts' interstate pipeline nominations to power plants in Florida tumbled 0.6 Bcf/d on the day.

**Platts Analytics forecasts total Southeast power burn to average 11.4 Bcf/d over the next week, approximately 0.1 Bcf/d lower week-on-week.

**Cooler weather, heavy rainfall and potential flooding could add downside risk to power burn estimates, especially if severe weather damages power lines and related electricity infrastructure that could reduce loads.

**Industrial demand in Florida and Georgia could potentially face downside risks that may arise from severe weather, according to Platts Analytics. Florida's industrial demand averaged 298 MMcf/d in 2018, while Georgia's averaged 434 MMcf/d, EIA data shows.

**Sabal Trail Transmission pipeline terminates at a Central Florida Hub south of Orlando, where it interconnects with the two existing natural gas pipelines that serve central and southern Florida. Enbridge, the owner of the pipeline, said it is monitoring the storm.

**Williams operates the Gulfstream Natural Gas pipeline, a 745-mile, 1.3 Bcf/d underwater line from Mobile Bay, Alabama, to Tampa Bay. A Williams spokesman said Friday the company is prepared to operate its compressor facilities remotely and does not anticipate any operational impacts from the storm.

**Kinder Morgan, owner of the Florida Gas Transmission pipeline, an approximately 5,300-mile system that transports gas from South Texas to South Florida, said the company continues to monitor the storm.

LNG

**Kinder Morgan is monitoring the storm for potential impacts to its Elba Island LNG export terminal in southern Georgia, a spokeswoman said Monday.

**Elba Island Train 1 has not entered commercial service or exported any commissioning cargoes. There are no vessels expected at the terminal, according to Platts Analytics vessel tracking software cFlow, as the facility is still awaiting to export its first LNG cargo.

REFINED PRODUCTS

**Concerns that Dorian would cause a drop in gasoline consumption helped push RBOB crack spreads lower. The ICE November RBOB crack vs Brent was trading around $3.48/b Monday afternoon, down from a close of $3.87/b Friday, and $4.21/b August 28.

**Dorian Monday passed over the Bahamas, home to Buckeye Partners' 26 million barrel petroleum storage, transshipment and blending facility at Freeport. Buckeye could not be reached for comment.

**Equinor's Grand Bahama Island facility in South Riding Point has 6.75 million barrels of crude and condensate storage capacity as well as blending and transhipment capabilities. According to a Bloomberg report, Equinor was shutting its facility ahead of Dorian. Equinor could not be reached for comment.

**Florida drivers have been filling up ahead of the storm's arrival, causing some retail stations to run out of fuel, the Florida Petroleum Marketers Association said Friday. However, the DOE said Monday that retail demand had begun to stabilize. "Petroleum markets remain fully mobilized to resupply stations as needed," the DOE said.

**"Florida Highway Patrol (FHP) is escorting fuel trucks to ensure fuel reaches critical areas more quickly. The state is working closely with the fuel industry to ensure there is an adequate fuels supply statewide," the DOE said.

**According to the DOE, Lower Atlantic refined products inventories are within the five-year range, with with gasoline 2% above the five-year average and distillate 1% above the five-year average. Jet fuel stocks were 11% above the five-year average across the East Coast.

**Florida relies primarily on waterborne refined products supplies, as it has no refineries and is not served by major pipelines. Parts of Northern Florida also receive fuel via truck deliveries from Georgia and Alabama. Refined products are delivered primarily to marine terminals at Jacksonville and Fort Lauderdale (Port Everglades) on the East Coast and Tampa on the West Coast.

**Kinder Morgan's Central Florida Pipeline delivers refined products from the Tampa terminal to Orlando.

**An average of 298,000 b/d of total refined products entered Florida via Port Everglades in 2017, while Tampa brought in 298,000 b/d, according to the DOE.

**Florida's main East Coast ports were closed Monday, according to the US Coast Guard, with the exception of Jacksonville, which was open with restrictions. The port of Tampa was open.

**The South Carolina Ports authority said that all terminals will be operating normally on Tuesday, but terminals in Charleston and Georgetown will be closed on Wednesday and Thursday to reopen on Friday.

**The US Coast Guard set restrictions Monday for the ports of Wilmington and Morehead City, North Carolina, with both expected to be shut down by Wednesday.

**According to S&P Global Platts Analytics, Florida's gasoline demand is 594,000 b/d, around 6.4% of the US total.

**Georgia's gasoline demand is roughly 328,000 b/d, with South Carolina's gasoline demand at roughly 187,000 b/d, and North Carolina's at 307,000 b/d, according to Platts Analytics.

**Looking at the last eight major hurricanes dating back to 2005, Platts Analytics has calculated that on average hurricanes have caused gasoline demand in the affected states to fall 22.4%.

OFFSHORE OIL PRODUCTION

**With Dorian now projected to move its way up the US East Coast, the threat to offshore Gulf of Mexico oil and gas production has diminished.

**BHP canceled its evacuation of non-essential personnel from its Shenzi and Neptune operations because Dorian had shifted course, a company spokeswoman said Saturday.

**A BP spokesman said late Friday that the company had evacuated non-essential crews from its four operated platforms in the Gulf -- Atlantis, Mad Dog, Na Kika and Thunder Horse. BP could not be reached for comment Monday.

**Many large offshore Gulf fields operated by BP, Chevron, Shell and a few midsized producers are sited slightly east of Louisiana's "big toe" in waters technically south of Mississippi and Alabama.

**Collectively, these fields account for the bulk of the Gulf's roughly 1.79 million b/d of oil, according to the US Energy Information Administration.

-- Janet McGurty, janet.mcgurty@spglobal.com

-- Jim Magill, jim.magill@spglobal.com

-- Starr Spencer, starr.spencer@spglobal.com

-- Jared Anderson, jared.anderson@spglobal.com

-- Jeff Mower, jeff.mower@spglobal.com

-- Rocco Canonica, rcanonica@spglobal.com

-- Joniel Cha, Joniel.Cha@spglobal.com

-- Edited by Jeff Mower, newsdesk@spglobal.com