Shell said in a shipper notice that it would halt crude deliveries and receipts at its Zydeco Houma, Louisiana, terminal Tuesday in advance of Tropical Storm Francine.
This includes receipts from the 22-inch Port Neches-to-Houma portion of its Zydeco crude pipeline system and Gulf of Mexico production coming into Houma. Deliveries from Houston and Nederland on the Zydeco system will continue until Port Neches tanks are full.
The Zydeco system enables shale oil from the Permian Basin to reach points further east such as refineries in Louisiana. Some of shipments on Zydeco are used by blenders to produce Light Louisiana Sweet crude (LLS) that is used by local refineries or for exports. In addition, the Houma terminal is also the delivery point of Poseidon crude from offshore fields.
Separately, Chevron has notified its shippers that its Empire, Louisiana, terminal would be suspending service Tuesday ahead of the storm. The Empire facility is the delivery point for Heavy Louisiana Sweet crude originating from fields in the Gulf.
Both companies will provide updates on their operations once the storm has passed. Francine is expected to bring heavy rainfall and flooding to far northeast Mexico and southern Texas Tuesday, and across much of Louisiana and Mississippi through Thursday. The storm is expected to make landfall Wednesday in southwestern Louisiana as a hurricane, according to the National Hurricane Center.
