Researched by Industrial Info Resources (Sugar Land, Texas)--In the U.S., the Texas Gulf Coast (as well as the rest of the state) suffered severely during Winter Storm Uri, which caused widespread power outages and the shutdowns of many chemical, power and refining facilities. Having come out of this harrowing situation, the Gulf Coast and the rest of the Atlantic Seaboard may face new challenges this year. Last week, meteorologists at Colorado State University (CSU) forecast an above-average hurricane season in the Atlantic this year. The CSU Tropical Meteorology Project team is predicting 17 named storms during the Atlantic hurricane season, which runs from June 1 to November 30. Of those, researchers expect eight to become hurricanes. The team predicts that 2021 hurricane activity will be about 140% of the average season.

Trey Hamblet, Industrial Info's vice president of research for the Chemical Processing Industry, said, "An active season for the Gulf Coast would be very challenging to profits after the industry experienced the big disruption from Winter Storm Uri. A series of hurricanes that take a large number of plants offline will be unusually burdensome on the industry, considering plant owners are already trying to make profits after a very costly 2020 year of storms and COVID-19 operating reductions."

"I think what's interesting," said Chris Paschall, Industrial Info's vice president of research for Petroleum Refining, "is to see what was predicted last year and how this changed. An above-average season was predicted last year by CSU, but it turned out worse than their predictions." In April last year, CSU forecasters predicted an Atlantic hurricane season with 16 named storms and about 140% of average activity. This estimate kept going up as CSU released updated forecasts throughout the year. Its last 2020 update, which came in August, predicted 24 named storms and about 190% of the activity seen in the average season.

In fact, by December last year, the Atlantic Basin had seen 30 named storms, 13 of which became hurricanes, causing hundreds of fatalities and damage to several industrial facilities along the Gulf Coast. In August last year, the Federal Offshore Gulf of Mexico saw its largest monthly decrease in production of crude oil since September 2008, dropping by 453,000 barrels per day, or 27%, as a result of shut-ins caused by hurricanes Laura and Marco, according to the U.S. Energy Information Administration (EIA).

Hurricane Laura, which slammed into Cameron, Louisiana, as a Category 4 storm, caused massive disruptions to liquefied natural gas (LNG), power facilities, refineries and chemical plants in Louisiana and parts of East Texas. At the time, more than 310 industrial plants in the immediate area of the storm's landfall, including seven petroleum refineries and 14 ethylene units, were confirmed offline. Power outages and waterway shutdowns due to Laura caused Sempra Energy's (NYSE:SRE) (San Diego, California) 15 million-ton-per-year Cameron LNG plant in Hackberry, Louisiana, to stay offline for more than 40 days. For more information, see October 7, 2020, market brief - Cameron LNG Begins Shipping Again.

Laura was followed by Hurricane Sally, which made landfall in mid-September near Gulf Shores, Alabama, as a Category 2 storm, causing a wide range of chemical, metals and pharmaceutical facilities to shut down in advance. For more information see September 16, 2020, article - Hurricane Sally Makes Landfall as Category 2 Storm, a Weather Impact Update by Industrial Info. Hurricanes Delta and Zeta later made landfall in Louisiana, causing refinery shutdowns. For more information, see December 15, 2020, article - Industrial Info's Researchers Track, Report on Harrowing 2020 Hurricane Season.

The primary reason cited by CSU for last year's active season is the same for this year: the likely absence of El Niño. According to a CSU release, "El Niño tends to increase upper-level westerly winds across the Caribbean into the tropical Atlantic, tearing apart hurricanes as they try to form. While the tropical Atlantic currently has water temperatures near their long-term averages, the warmer-than-normal subtropical Atlantic typically forces a weaker subtropical high and associated weaker winds blowing across the tropical Atlantic. These conditions then lead to warmer waters in the tropical Atlantic for the peak of the Atlantic hurricane season."

The report also includes the probability of major hurricanes making landfall:

  • 69% for the entire U.S. coastline
  • 45% for the East Coast, including the Florida peninsula
  • 44% for the Gulf Coast from the Florida Panhandle to Brownsville, Texas
  • 58% for the Caribbean

These are the same figures as released in the April forecast last year.

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