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Former Shell Oil President John Hofmeister on the state of oil refining and distribution in the path of Hurricane Sandy.
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Officials in the energy business and really any government still trying to assess all the damage done by hurricane sandy.
On refineries.
The entire infrastructure that deliver oil and gas to businesses and individuals.
Joining us now with his take is -- myself.
President of Shell Oil don't give any sense though of how quickly these refineries will be able to restart -- 70%.
Of refining capacity in this part of the country we will shut down.
Well generally under the best of circumstances once you shut down -- -- it takes between five and ten days to get back up and running.
Unless you find damage.
If you've been flooded chances are you could have some electrical damage if you're -- calls were were on on the ground on the ground level.
So we don't know yet as -- keep reading everything I can read to see what what's being reported but something else to worry about -- Are the ports damaged because the northeast as you probably know gets a lot of its fuel supplies from Europe -- the Caribbean.
Abide by ship.
And so the ports are damaged with that huge sea surge that could be another issue in terms of supply.
Normally there's a three to four week supply available.
And so there shouldn't be an immediate -- Of general supply.
But at the retail level or at the -- low level if you don't have electricity.
You're out of business.
And that puts a strain on the stations that do have electricity.
So -- likely to see gas lines.
Likely to see some some mild spiking in the gas price because of availability issues but I don't think this is a long term issue.
We also we do have the colonial pipeline that comes and -- -- Maryland and Virginia and it can get product by the plantation pipeline.
The colonial coming into New Jersey does that help alleviate any supply problems that we might suffer.
Well it helps but it's not enough you really have three sources on the East Coast for supply the colonial is one.
The refineries or another and the imports are another.
So if it any one of those three is not available you're going to have.
Probably some of the some constraint on supply.
But that doesn't prevent trucks from being utilized say with -- -- 3500 mile radius of trucking product -- It's very inefficient and it adds to the cost.
But it is another way of meeting immediate needs what I worry about the most after hurricanes.
Over the years.
Is the immediate.
Desire of retail customers to go -- fill up -- because everybody gets nervous.
People know the electricity is is rare.
And and so everybody is out topping up that creates a shortage what they do so there's a normal distribution supply.
But the but the gas lines people topping up that creates a shortage -- That there -- a lot of gas stations in the area that were out of gasoline before the storm hit for that very reason people top and off.
Their -- their trucks they're issued -- and filling up.
Canisters for their generators say you what you got to drive around on Sunday night trying to find gasoline.
But John big picture this is an epic storm a super storm.
But it's something that we really couldn't have planned for potentially but what can we do as a nation in terms of the infrastructure particularly in this part of the country day.
To prepare for another big one that could head.
Well for the northeast in particular the biggest issue that the northeast has.
There's the fact that it is so dependent.
On other parts of the country.
Think about this there hasn't been a refinery -- any new infrastructure built in the northeast.
It probably forty or fifty years and a population of the northeast has about doubled in that period of time.
And so you just don't have the adequacy of supply.
For example like we have on the Gulf Coast.
The California has some of the same problem but they don't get hurricanes the way the way we do and east so what it takes is a more infrastructure.
Being hardening of the infrastructure so the Gulf Coast has -- the hugely hard and infrastructure.
Learning from -- the hard lessons of Katrina and Rita and -- and so forth.
And and so you have refineries that are more resilient.
Because he's 'cause doesn't -- the storms I submit that the refineries even -- old.
Are still safe but they may not be as resilient as what you would have on the Gulf Coast so that's something you could do.
John good to save thank you so much on hot Meister take care we'll see -- very sent.
Thank you car -- you guys are.
