Dodging Disaster

Worried about your agency's ability to handle massive disruption during a crisis? Take a lesson from the Minerals Management Service.

Imagine a catastrophe that wipes out your agency's center of operations, eliminates your ability to communicate with colleagues, disrupts your life in unfathomable ways and sends your workload soaring. That's what happened last fall to employees of the Minerals Management Service responsible for administering offshore oil and gas leases in the Gulf of Mexico-not once, but twice. Hurricanes Katrina and Rita dealt a one-two punch just as the agency was most needed to handle unparalleled destruction to the nation's energy infrastructure.

The blow to the agency, to workers and to the industry they oversee was unprecedented. Of the 530 MMS employees working in the region, 236 sustained significant losses, including complete or nearly complete destruction of their homes. The agency's nine-story regional office in New Orleans was ravaged by wind and water, displacing employees to other facilities across the region. The considerable losses sustained by the oil and gas industry further contributed to the agency's burden. By law, MMS must publish daily status reports on energy production. The two hurricanes forced a complete shutdown of oil and gas production in the Gulf, destroyed 115 offshore platforms and extensively damaged 52. Before industry can begin pumping oil and gas again after such a disaster, MMS petroleum engineers, geologists, technicians and other specialists must assess the damage, approve industry plans for repairs and certify their completion.

"It's been a long six months," says Chuck Schoennagel, deputy regional director of MMS' offshore management operations in the Gulf. Like most federal agencies, MMS has a continuity of operations plan, or COOP-a blueprint for maintaining critical operations following a crisis. Under the plan honed over the years by MMS' Gulf Region office in New Orleans, a six-person team would evacuate to Houston and establish communications to collect critical data from energy production companies and assess infrastructure damage until the crisis passed and the regional office could resume operations. At least that's how the plan has worked the dozen or so times agency managers have activated it during hurricanes and annual exercises.

But when Hurricane Katrina made landfall on Monday, Aug. 29, the New Orleans office was incapacitated; cellular and landline telephone communications were disrupted for days. With the majority of employees evacuated from their homes to unknown locations, agency officials scrambled to track them down. And as the COOP team settled in for what was looking like the long haul in Houston for recovery operations, Hurricane Rita gathered force in the Gulf on a trajectory toward the Texas city.

"We were sitting at lunch one day in Houston and somebody said, 'I wonder if we need a COOP plan for our COOP site.' About a week later, it turns out we did," says Schoennagel.

Changing Forecast

Hurricanes are closely watched at the MMS office on Elmwood Park Boulevard in New Orleans. On Wednesday, Aug. 24, many people were aware that a tropical depression over the central Bahamas was strengthening into a tropical storm. Forecasters predicted a hurricane would hit southeast Florida. On Thursday, Katrina gathered into a Category 1 hurricane and struck south Florida with 80-mph winds. The same day, while forecasters were warning that Katrina would enter the Gulf before returning to south Florida for a second blow, Schoennagel took leave as planned and headed to the Florida panhandle where he was competing in a triathlon at the Sandestin resort.

Hurricanes are a way of life along the Gulf Coast; while people were watching forecasts and many were prepared, at least psychologically, to evacuate if necessary, most continued to go about their business. Caryl Fagot, a communications official who helps produce the daily status reports on oil and gas production, remembers fielding a storm-related question from a reporter Thursday afternoon. There were no indications that the storm would have any serious impact on energy production in the Gulf, she recalls. She took Friday off and spent the evening at the Superdome, watching the New Orleans Saints play the Baltimore Ravens in a pre-season game.

By Friday afternoon, things were changing. Before leaving the office for the weekend, Richie Baud, a supervisor in the office of production and development, checked the Weather Service forecast models one more time. Four out of five models now showed Katrina heading directly toward New Orleans, not back over Florida. "I called my wife and said, 'Call and get hotel reservations immediately, because the next forecast is going to come out [showing New Orleans in the path], and hotels will book up fast.' "

Saturday morning, Tim Powers, the director of information technology for the regional office and a COOP team member, headed to the office to retrieve backup computer tapes. On his way in, he got a call from Carl Sigler, the facilities and personnel director and another COOP principal. They met at the office and called the other team members, reaching Schoennagel at his triathlon. They immediately activated the emergency plan and everyone headed to Houston.

Team member Jason Mathews, a petroleum engineer who tracks energy production, offshore evacuations of rigs and platforms and damage during hurricanes, says there was little time to prepare for a long-term departure. "We had to be in Houston in five hours." He says he wasn't too worried: "I knew my parents and my brother and my relatives were responsible enough to take care of themselves."

Powers knew Katrina was going to be exceptional when he received an automated message at 9 p.m. Sunday in Houston before the storm hit: The uninterruptible power source for the New Orleans' office computer center was shutting down. "I knew it was going to be bad," he says. The UPS, a battery-operated system that regulates power in the computer room to protect the network from surges and failures, had never before gone down.

The next morning, Katrina made landfall. "By Tuesday, we realized just how bad it was going to be," Powers says. There were breaks in two levees and reports were coming in that 80 percent of the city was flooding, with water 20 feet high in some places. Powers contacted procurement specialists at MMS' parent agency, the Interior Department, and began ordering laptops, printers, copying machines and additional bandwidth to set up more extensive operations in Houston. The COOP team members had cable television installed in the conference room so they could see what was going on in their hometown.

'We Lost Everything'

The Gulf of Mexico has proved an underwater energy gold mine of sorts, producing 30 percent of the oil and 22 percent of the natural gas consumed by Americans. MMS manages all offshore energy and mineral resources on the 1.76 billion acres of the Outer Continental Shelf. The agency has two branches: Offshore Minerals Management and Minerals Revenue Management, which collects royalties from offshore and onshore mineral leases on federal and tribal land. The majority of the 8,300 active offshore leases are in the central and western Gulf of Mexico, under the purview of the Offshore Minerals Management's Gulf of Mexico regional office in New Orleans.

Because of the Gulf's importance to national energy supplies and the U.S. economy and because of MMS' role in managing that critical resource, agency officials were under tremendous pressure to assess and report damages as quickly as possible. "You can imagine the workload we were dealing with, with all the offshore infrastructure and having to brief the president and the secretary of Interior," says Mathews, who was responsible for pulling together and assessing data for use in daily press releases and briefings for then-Secretary Gale Norton.

"Not only do we track what's been shut in, but we try to estimate when production will come back online by investigating which facilities are damaged and where they're tied into the pipelines and refineries all along the coast of Mississippi, Louisiana and Texas. You're dealing with about 4,000 facilities, 35,000 miles of pipelines and probably 20 refineries and terminals that are all interconnected. You're tracing production through a system that's not well understood by many, and you're [reporting this within] a time frame of five to six hours every day, through conversations with more than 100 people," Mathews says.

That pressure didn't leave much time to think about the whereabouts of his family and the status of the city the 25-year-old engineer has called home his whole life. "I was showing up for work [at the Houston office] at 4:30 or 5 o'clock in the morning and not leaving until 6 or 7 at night, just to stay focused and not think about what was going on at home," he says. Only days later would Mathews be able to reach his family.

Meanwhile, Schoennagel and other MMS officials were trying to track down employees. Mary Fosson, a supervisory human resources officer, arrived in Houston that Wednesday to help find people. "We had to determine where our employees were, if they were safe and if they needed help. It was very hard to do," she says. After a few days, somebody discovered that text messaging could be used to reach employees where cell phones failed. It was a revelation that quickly yielded results. After the team broadcast a text message with the new office number in Houston, employees started calling in en masse.

Richie Baud, who had evacuated with his wife, 10-year-old daughter and his dog to Natchitoches, La., a picturesque town northwest of New Orleans, was relieved to finally make contact with the Houston office. "Instead of being just a refugee, I became a refugee with a purpose," he says.

Like dozens of other MMS employees, Baud quickly made his way to Houston and started working. His primary job there was to review and approve industry requests to burn off dangerous excess gas that had built up prior to restarting production. To bring production back up safely or to evaluate damaged pipelines, producers often first need to flare, or burn, the gas-activity that MMS must approve beforehand. While Baud and his family were en route to Houston, he learned that his oldest daughter, a nurse at Memorial Hospital in New Orleans, had been evacuated by helicopter. "She was trapped there, and we were real worried. It was a nightmare," he says. Days later they would be reunited in Houston.

It quickly became clear that MMS would not be able to resume operations in New Orleans anytime soon. Powers and Schoennagel flew to the New Orleans office aboard one of MMS' contract helicopters and walked through offices on all nine floors. There was extensive water and mold damage, especially to the upper floors. The computer room on the ground floor survived comparatively well-the UPS had to be rebuilt, but it had saved the system from serious damage. "Each floor had a little more damage the higher we went," says Powers. "By the time we got to the seventh floor, there was a lot of damage. By the time we got to the ninth floor, it would take your breath away."

As they walked through the offices, Schoennagel retrieved photographs from employees' desks. For Fagot, those would be the only family photos that survived Katrina. She and her sister, along with their elderly parents and Fagot's disabled son, had evacuated the day before the hurricane struck to Kinder, La., about 40 miles north of Lake Charles, leaving behind the home their parents had built and the house she and her sister owned next door, along with the neighborhood that they had called home their entire lives. Both homes were destroyed, although it would be weeks before they would know that-so severe was the damage in their neighborhood residents were not allowed back in to survey the area for several weeks.

As employees found their way to Houston, the COOP site quickly became overwhelmed. "There was a lot of emotion and it was adding stress," recalls Mathews. By then, he had been in touch with his family, who had evacuated to Lake Charles to stay with his fiancée's family, but he knew that his home and his neighborhood had been devastated.

Three and a half weeks after Katrina hit, as managers were making arrangements to lease additional office space in Houston and re-establish more functions there, Rita began to bear down on their new location. The evacuations, and for some, the losses, began all over again. "I'm not sure there are words to describe it," says Powers.

"We were really despondent," says Fagot, who found herself evacuating the home she had just rented in Kinder. She and her family escaped just before a tree crashed through the roof. The family home of Mathew's fiancée, where his own family had taken refuge, also had to be evacuated during Rita. "We lost all our birth certificates, Social Security cards, insurance papers, pictures of everyone growing up. My mom even had our rosary beads from our first communion and stuff like that. She had all that stuff in storage, but we lost everything," Mathews says.

Redefining 'Normal'

Before Katrina moved into the Gulf of Mexico last summer, 1.5 million barrels of oil and 10 billion cubic feet of gas flowed from wells there every day. Between Katrina and Rita, 100 percent of oil production and 94 percent of gas production was shut down. By January, MMS estimated that 75 percent of production had been restored to pre-hurricane levels, but officials say it is highly unlikely full production will be restored before the 2006 hurricane season, which officially starts on June 1. A shortage of critical equipment and skilled workers has hindered recovery, forcing many companies to request from MMS extensions beyond the 180-day period they normally have to make repairs and resume production following storm damage. (Under the law, MMS can revoke a company's lease if production ceases for more than 180 days.)

The agency itself has had difficulty conducting timely inspections, and in many cases has granted conditional approval for repairs pending physical inspection. "We didn't suspend any of our requirements," says Schoen- nagel, but to get production online as quickly as possible MMS did issue notices to leaseholders allowing them to resume production prior to inspection from MMS as long as their repairs met standards established by the agency.

"In other words, we said, 'If you can make repairs in accordance with our requirements, then go ahead and do it. We're going to look at it when we can get to it, but we're going to hold you responsible for the things you said you did.' We did that partially to deal with the price of gasoline," he says. "We were really being pushed to try and get production back up."

For employees, the destruction continues to reverberate. After two months in Houston, Richie returned to New Orleans where MMS began leasing temporary quarters across the city while the main office is being renovated. Like other MMS employees whose homes were damaged or destroyed, he and his family moved into a FEMA trailer at Bayou Segnette State Park, across the Mississippi from the old office. After a couple of months, electricity and hot water were restored to their home and they were able to return. But they are living on the second story until contractors render the first floor habitable.

Katrina spared Powers' home from severe damage, but looters stole jewelry and tools before he could return. Still, he counts his blessings. "There's a whole new definition of normal," he says. "The places you used to go are just gone."

Fagot is still uncertain of her family's long-term plans, or how they will eventually deal with their demolished homes. The memory of the destruction and the smell of the rot still astonish her. "It was as if somebody took the roof off the home, filled it up with water and mud, and then shook everything up. Anything that was wood was in splinters. Pasteboard was disintegrated. The refrigerators had floated away from the walls, overturned and spilled all their contents. You could hear the hum of maggots," she says. "Everything we had in our family is gone."

Mathews now is telecommuting to MMS headquarters in Herndon, Va., from Chicago, where he lives with his fiancée, who is in medical school there. They plan to return to New Orleans later this year. "It's a totally different world now. I just can't explain what it's like," he says.

"I've learned a lot," Mathews adds. "I've learned that pretty much everything I have is replaceable, as long as I don't lose my family. I've gotten a lot closer to the people I work with-they pretty much became my family. You always learn stuff when things don't go right."