Louisiana Grapples With Fuel Shortage After Ida Shut Refineries

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Louisiana Grapples With Fuel Shortage After Ida Shut Refineries
Credit: © Reuters.

(Bloomberg) -- As utility crews strive to restore power to New Orleans, one of hurricane-ravaged Louisiana’s most pressing needs is fuel. 

“It’s impacting all of our recovery efforts,” Governor John Bel Edwards said Wednesday in a press conference. “Fuel just isn’t available to us the way we would want it to be.”

It’s a painful irony for a state that, most of the time, supplies much of the U.S. with gasoline and diesel. Louisiana’s refineries represent nearly one-fifth of the country’s crude-processing capacity. Many fuel producers shut their plants there as Hurricane Ida roared ashore Sunday, leaving supplies pinched. And widespread damage to the electricity grid has cut off their power.

Edwards said he had spoken with the White House to enlist President Joe Biden’s help bringing fuel to the region. The president plans to visit Louisiana Friday, he said, to see Ida’s destruction first-hand and discuss recovery needs.

“Quite frankly, we need bulk fuel brought in before the refineries come back up on their own, because we don’t know when that’s going to be,” Edwards said. “We need the rest of the country to give up a little bit of their fuel to come back to Louisiana.”

Exxon Mobil Corp (NYSE: XOM )., which is currently in the process of restarting its Baton Rouge refinery, said it’s working with independent distributors and wholesale customers to help meet consumer demand, without detailing how it’s supplying the fuel. The company said it has supplied more than 230,000 barrels of fuel over the past nine days, or roughly 25,000 barrels a day. But that amount pales in comparison to the state’s 3.4 million barrels of daily crude-processing capacity.  

Efforts to restore the power grid, meanwhile, made slow progress Wednesday, with electricity service restored to a small section of New Orleans. 

Electricity came on for about 11,500 customers starting at about 1 a.m. local time, according to Deanna Rodriguez, president of Entergy (NYSE: ETR ) New Orleans. The company has managed to repair one of the eight transmission lines that went down during the storm, and it’s now bringing in power from east of the city. 

“In the coming days and into the weekend, we’ll start to see a lot of progress,” Rodriguez said during a press conference Wednesday. 

Also See: Hurricane Ida Estimated to Cost Insurers Almost $18 Billion

The company plans to restore power by going “substation to substation,” working around the city in a loop from east to west. “We’re not picking neighborhoods,” she said. “We’re following the flow of electricity.” 

The storm, with winds of 150 miles (240 kilometers) per hour, took down more than 2,000 miles of transmission lines, plunging more than 1 million homes and businesses into the dark. 

More than 990,000 homes and businesses in Louisiana remain without electricity, including 89% of New Orleans, according to PowerOutage.us. 

Those outages have affected not just the refineries that produce fuel but the gas stations that distribute it. Early Wednesday afternoon, 58% of the gas stations in New Orleans and 54% of sites in Baton Rouge were not pumping gasoline, according to retail tracker GasBuddy.

The number is expected to fall as power is restored to the businesses. Texas refiners are expected to increase production to supply Louisiana by pipeline, with the Colonial Pipeline across the state having resumed operations Monday night.

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