Gulf Repair Job Tougher Than Expected

Bringing oil and natural gas production back online in the Gulf of Mexico isn't turning out to be as easy as many had hoped.

That was the message from the U.S. Minerals Management Service Tuesday when it provided an update on production from the Gulf in the wake of hurricanes Katrina and Rita. Over 1 million barrels of daily oil production and over 6 billion cubic feet of natural gas remain offline in the Gulf, the federal agency said.

To date, 54.5 million barrels of oil production have been lost in the Gulf, nearly 10% of the region's annual output, and nearly 272 billion cubic feet of natural gas production, over 7% of yearly natural gas output. While that energy will eventually be extracted, it's still a significant amount of supply taken out of an already tight market. ...