August 19, 2022 [ Oil Price ] – Shell has halted production at three of its deepwater platforms in the Gulf of Mexico, Shell said in a statement to Reuters on Thursday.

Shell has halted production at its Mars, Ursa, and Olympus platforms, which combined can produce 410,000 barrels of Mars sour crude oil per day, after a leak shut in the Mars and Amberjack Pipelines that connect to the platforms. Shell has not provided a timetable for restart, although the company said it was evaluating “alternative flow paths” to bring the oil to shore through other pipeline routes.

“Shell is coordinating with local authorities and mobilizing personnel and equipment to assess the situation,” Shell said in a statement.

The leak was detected at the Fourchon booster station, which increases the pressure and the flow of crude on its way to the Clovelly Dome Storage Terminal in LOOP. The Clovelly Dome terminal stores crude oil in underground salt caverns before heading to a refinery. The terminal is capable of holding 40 million barrels.

The United States is already releasing between 800,000 and 1 million barrels of crude oil per day from its Strategic Petroleum Reserves in an attempt to alleviate the tight market and bring down prices. Crude oil inventories in the United States are 5% below the five-year average, with crude oil production in the United States failing to return to pre-Covid levels.

Current crude oil production in the United States is at 12.2 million barrels per day, compared to the pre-Covid peak of 13.1 million bpd reached in March 2020.

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