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American Morning

Hurricane Rita Barreling Toward Gulf Coast

Aired September 23, 2005 - 08:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

SOLEDAD O'BRIEN, CNN ANCHOR: Welcome back, everybody.
You are seeing right there the satellite loop of Hurricane Rita. An 8:00 update from the National Hurricane Center tells us that the wind speeds are holding at 140 miles an hour. And if you look at that picture, you can see that is a massive storm heading right for Texas and Louisiana at this Hurricane Rita. We are told, though, the storm might actually drop in wind speeds a little bit more. Still a massive category four storm. I mean 140 mile an hour winds, Andy, are really just enormous.

ANDY SERWER, "FORTUNE" MAGAZINE: Yes.

S. O'BRIEN: Let's talk business, because gas is not the only thing in short supply -- money.

SERWER: Right.

S. O'BRIEN: And that's a big problem.

SERWER: Yes, I mean it's obviously a huge problem. And when talking about these gas shortages with Miles this morning a little bit, how about running out of cash? This is -- really could be a very difficult situation in the Houston area. But apparently ATMs are running out of cash. Some banks are reporting that they're shutting their ATMs down.

Chase had 37 ATMs that are out. And what's going on here, Soledad, the roads are clogged and they can't get the armored cars with the cash into the city. Comerica has shut down all of its ATMs in Houston. And I think that puts its customers in a very difficult situation. Some banks are reporting they have mobile ATMs in Austin they're going to bring down.

But, you know, you and I were talking about preparedness here. And this sort of reminds you of Katrina. Can't we anticipate some of these things? You know, we saw this was coming several days ago. Gasoline, cash. I hope there's enough water and food around, as well. Can't they stockpile some of these things in advance?

S. O'BRIEN: One would hope that there have been lots of lessons learned.

I mean it looks as if some of the local officials really have learned lessons in calling for the evacuations earlier, really making mandatory evacuations mandatory.

SERWER: Right.

S. O'BRIEN: I mean you saw them cuffing the guy on the beach in Galveston.

But you're right, there are clearly some big problems.

SERWER: Yes.

S. O'BRIEN: Andy, thanks.

SERWER: You're welcome.

S. O'BRIEN: Hurricane Rita, that is our top story this morning, getting closer. People in the projected path getting out. One of the biggest evacuations in U.S. history.

Miles is in Houston this morning -- Miles, good morning.

MILES O'BRIEN, CNN CORRESPONDENT: Good morning again, Soledad.

I'm on Interstate 45, about 35 or 40 miles north of Houston. And as you can see behind me, the traffic is going at a pretty good clip here. But if you look just on the crest of the horizon there, you'll see a lot of taillights. We're sort of at the trailing edge of what is really a 100 mile long traffic jam in the wake of this unprecedented evacuation of the City of Houston.

And in the midst of all of this, take a look at this live picture now just coming into us from the Dallas area.

There's, first of all, look at that traffic jam there. And at the head of it there, in the midst of all of this, firefighters are working to douse a blaze in a bus that was carrying evacuees from Houston.

There you see the charred remains of the bus there. A little while ago, it was fully engulfed in flames. We don't have any word on any injuries as a result of all this. We're just hoping that everybody got out in time, before that bus started burning.

The net effect for people here -- I'm about 200 miles south of that right now -- if they're headed toward Dallas they're in for yet another hurdle which lies ahead. There's the pictures from just a little while ago. KDFW feeding those to us, showing that bus completely engulfed in flames.

As we say, we're trying to get further details for u. But we do know it was a bus carrying evacuees from the general Houston metropolitan area on their way to safety, they hoped, in Dallas. And as we say, we're working on trying to get you further details on that.

The scene here is just a remarkable one. In the 30 miles we traveled from where we stayed last night to here, probably saw 1,000 cars on the shoulder. People sleeping, people stalled, people unable to move on, either fatigued or just no gas in their gas tanks, waiting for some of these tankers, which authorities have promised will be circulating around, filling up people's gas tanks. In the meantime, a lot of people are just waiting by the side of the road.

Chad Myers has been watching all of this from the Weather Center, as he always does. He is our severe weather expert with the latest word on Rita -- and, Chad, we have heard on the radio some talk of people wanting to make a U-turn and head back upon hearing that Rita is headed a little bit to the east of Houston.

CHAD MYERS, CNN METEOROLOGIST: Yes.

M. O'BRIEN: Would you call that a wise move at this point?

MYERS: If you're going to make a U-turn because you're stuck in traffic and you can keep going down to maybe a place like Corpus Christi or keep going west over to Austin, that might not be a bad idea. If you just can't get anywhere else and you are listening to us on X.M. Radio or something like that. But going back to the City of Houston, if you live in a low lying area or not a very strong building or back to a mobile home, absolutely not. Not a wise idea whatsoever.

This storm is still 140 miles per hour. The 8:00 advisory right here, the numbers coming in, as well, no real relief from the wind speed. A little bit of filling in when it comes to pressure. That means like, that's like filling in a pothole at least a little bit of the way. If you fill it in, it's not as big of a pothole. But this is still a very large and dangerous hurricane.

Morgan City down to Port O'Connor, the hurricane warning places have not changed. They are still in the exact same place. And New Orleans is still in a tropical storm warning, expecting tropical storm force winds.

Here are the numbers. I know a lot of you are writing them down, including my mother. 27.1, 91.5. Sustained winds 140. And, yes, that is still solidly into the category four hurricane.

Here's the Gulf of Mexico, Miles. Here's the warm water that we talked about. It's the warm current, the loop current. Here was the storm a long time ago, coming across the Florida Keys. It got into some cooler water, didn't get very high, 109 miles per hour, that number. Then it ran into some very warm water and that 109 went to 175.

Yesterday, it ran out of that hot water back down into the 140s, but now we're into another eddy current, another little vortex here of some warmer water. It could gain some strength today and then back into some cooler water before it makes landfall, right up here, it looks like, still now, to the north of Galveston.

Port Arthur really in some tough shape with a landfall like that -- Miles.

M. O'BRIEN: All right, bring on that cold water. Let's hope that helps dampen that storm a little bit.

Chad Myers in the Weather Center, thank you very much. We told you there was a gas station open here about 15 minutes ago. They ran out of gas. Take a look at the scene there. There's still people lined up as it becomes evident that there is no gas to be had at that Shell station. They are going to have to wait for those elusive tanker trucks that we've been hearing so much about but have yet to see this morning.

Among the many stories out here this morning -- there are thousands of them and they are often tales of woe -- are people who are Katrina evacuees.

Ron Breaux is among them.

He's from New Orleans originally, began his day in Houston.

RON BREAUX, NEW ORLEANS EVACUEE: Good morning.

M. O'BRIEN: Well, a couple of days ago, wherever it was.

Where are you headed and what is your plan, Ron?

BREAUX: Well, actually, we decided that we was going to stay here, you know? Because I have two small kids and my oldest son with me, along with my wife. The thing is, is that we paid up for a hotel room, right? And now they're telling us that we have to leave the hotel because they had already made plans for someone else to have the room. And I didn't figure that would be right because I thought it may be first come first served. And also considering that I'm from New Orleans and I've been through so much, you know?

We really don't know where we're going, where we're headed. We don't -- we really don't know where we are right now.

M. O'BRIEN: All right, so what hotel is kicking you and your kids out?

BREAUX: The Hampton Inn.

M. O'BRIEN: The Hampton Inn has told you, you have to leave?

BREAUX: We have to leave. We have the money to pay them and everything, you know, thanks to the American Red Cross. We saved that, you know, donations that people had given us while we was in Houston. You know, we saved that in case something like this was to happen. And now we're prepared to pay them but they won't take our money and we'll have to move on.

But me and my wife, we've been traveling up and down the road all day, you know, trying to find some help. And apparently now we're low on gas, so even if we do have to get cut out, we don't have any gas to go anywhere now.

M. O'BRIEN: I suggest you drive back and get your kids right now.

BREAUX: Yes, that's what I'm going to do. M. O'BRIEN: Because there's not -- there's not gas to be had. That's probably the safest place for you, Ron. You tell them you're not moving.

BREAUX: I'm not moving.

M. O'BRIEN: All right.

BREAUX: All right, thank you.

M. O'BRIEN: All right, Ron Breaux, good luck.

BREAUX: Thank you.

M. O'BRIEN: I wish you well.

Ron Breaux, who had to -- excuse me, I'll shake your hand there. I wish you well.

Ron Breaux, who had to evacuate New Orleans from Katrina is now in the middle of this mess in Houston. I think the best advice was that, go back to the hotel and be with your kids -- Soledad.

S. O'BRIEN: Gosh, that's a tough situation.

Miles, thanks.

Well, recovery activity going on in New Orleans even as Rita threatens to slow some of the progress that's been made since Katrina struck more than three weeks ago.

Let's get right back to Carol Costello.

She's in New Orleans this morning -- hey, Carol.

CAROL COSTELLO, CNN ANCHOR: Good morning, Soledad.

I'm standing on the levee that separates the Mississippi River from the downtown business district. You can see the Mississippi River here to my right. A big steel wall keeps that water in. And then there's this big hill of grass. And then down the hill you can see the City of New Orleans, the central business district, and beyond that, the French Quarter.

You know, it just was kind of depressing walking around yesterday because a lot of people were out still trying to rebuild the city. And despite what Rita brings, they are determined to stay.

(BEGIN VIDEOTAPE)

COSTELLO (voice-over): Even when the rain came, the work went on. In fact, the work went on all day.

Zack Barrow was busy unloading brand new refrigerators. His home is near Biloxi, Mississippi. It was damaged by Katrina, too. Yet here he is, working to help New Orleans. And what about Rita?

ZACK BARROW, NATIONAL FREIGHT INC.: I'm seeing the worst, you know? There can't be nothing but positive.

COSTELLO: Others found that difficult. They were wheeling what was left of their belongings to cars parked miles away, their city issued passes that allowed them to drive into the worst hit neighborhoods were rescinded because of Rita, so they walked, fearing Rita would take what they have left.

GEORGE STRICKER, NEW ORLEANS RESIDENT: We ended up not being able to return to pets. We ended up not being able to retrieve our food.

UNIDENTIFIED FEMALE: Don't get this. It's totally embarrassing.

COSTELLO: Oh, but we had to. Animal rescue was in those damaged neighborhoods tending to the pets. But they got stuck in the muck. A passing tow truck working to rid the neighborhood of ruined cars pulled them out. Others worked on, too. Electric crews were still putting in 15-hour days, restoring power, even though they knew Rita could knock it out again.

CLIFFORD VARNER, POLE LINE WORKER: My guys, they've been getting decent rest. The food has been good. The housing is a little bit different, but we're survivors. This is what we do for a living and we love it.

COSTELLO: Love it? Yes. And determined, like so many others, to rebuild New Orleans no matter what Mother Nature dishes out.

(END VIDEOTAPE)

COSTELLO: And, you know, Soledad, a lot of those utility workers are sleeping in tents. In fact, that's their lodging, tents. They've been told where to go to stay safe because the worry now is that tornadoes could be spawned from this storm. So they're listening to emergency workers and there are designated buildings for them to go to, one of them being the convention center, the good side, the side that, you know, you don't need those men in the biohazard suits cleaning it out.

S. O'BRIEN: All right, well, it looks like the situation and the weather deteriorating a little bit, Carol, where you are.

We'll check back in with you again this morning.

We've got much more on hurricane Rita, in fact, in just a moment. Texas, Louisiana, home to the nation's biggest concentration of oil refineries. We're going to talk to an energy analyst about just what this storm could do to gas prices.

And both of Houston's airports closing later today. Find out what travelers who are trying to get out need to know.

That's ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: You're looking at some live pictures from our affiliate WFAA. We're updating you on exactly what happened as this bus caught fire on I-45, just south of Dallas. The bus exploded. We saw pictures of it fully engulfed. Well, these pictures now showing the massive problem. The bus obviously just full of flames and the traffic has been part of the problem, as well, as the traffic has slowed to not moving at all.

A big problem for the rescuers. We are told by someone who was talking to our affiliate, WFAA, that he saw the bus explode. This is an eyewitness. He helped people get out by breaking out some of those windows. And he said that the people on the bus were evacuees who were leaving Houston as hurricane Rita makes it approach.

You can see some of the emergency personnel on the bus, as well. One person is now confirmed dead in that bus explosion. There are no more details than that. We'll continue to update you on this story.

Let's get right back to Miles O'Brien.

He is not that close to the situation, and yet the traffic is really what's linking you -- Miles, good morning.

M. O'BRIEN: Good morning, Soledad.

Yes, many of the people you see whizzing by me, and I suspect they're pretty happy to be moving as fast as they are, may not know what lies ahead, but probably have some sense that there's a tremendous traffic jam even unrelated to what you saw in Dallas just now, which appears to be an unfolding kind of tragic tale of this evacuation.

But nevertheless, they are about to get into this pipeline of traffic which is a real problem. Lots of people running out of gas. Lots of people stranded. No gas stations open to speak of.

In the meantime, what about air traffic? The airports here are technically open until midday, 12:00 local time, 1:00 Eastern time. There are two significant commercial airports here, Houston's Intercontinental George Bush Airport and Hobby Airport.

The man in charge of those airports is Roger Smith.

He joins us now on the line from Hobby Airport.

Mr. Smith, are you sticking to the plan to close down the airports at noon?

ROGER SMITH, SPOKESPERSON, HOUSTON AIRPORT SYSTEM, WILLIAM P. HOBBY AIRPORT: Well, technically the airports won't close. But the last airline flight out will go at noon at both airports.

M. O'BRIEN: OK. So for all intents and purposes people using commercial air travel, noon is the point at which they'll be no more service.

I assume, you know, it's kind of common sense, but you've got to call your airline before you go to the airport.

SMITH: Exactly. We're wanting everyone to realize -- and it looks like people are getting the message -- that they have to have a confirmed reservation before they come here and they also must contact the airline regularly to be absolutely certain they're -- the flight that they have a reservation for is going to go.

M. O'BRIEN: So if anybody gets a bright idea waking up, I'm going to avoid the traffic, go to Hobby, walk up to a counter and buy a ticket, they might as well forget that idea.

Let's talk about the scenes we're seeing now at both airports, the potential for a lot of stranded passengers. And while George Bush Airport is way north of the storm, Hobby is getting a little closer to where a flood zone could be.

Are you going to evacuate people are keep them there?

SMITH: What we've been doing is our operations staff has been making announcements, walking alongside the lines and asking people do you want us to provide you assistance if you can't get out? And those names, we've been offering that all day yesterday and we're continuing to do that today. But so far only nine people have said yes, put my name on that list. And so based on how many people say they need that kind of evacuation, we'll contact the Houston Emergency Center and people can be bussed out of here to there.

M. O'BRIEN: All right. So will you allow people to stay at the airport if they want to?

SMITH: It's a public building. It's not an -- it is not a shelter. It's not an ideal place to be in a hurricane.

M. O'BRIEN: OK.

One other footnote to all of this. There were several Transportation Security Administration workers that didn't show up yesterday at George Bush Airport.

Have you seen any more of that? And is that causing any problems for air traffic?

SMITH: They have enough staff today. The lines are moving well. The lines are nothing like what they were yesterday.

M. O'BRIEN: OK.

How many TSA people didn't show up?

SMITH: You'll have to ask the TSA about that.

M. O'BRIEN: OK. Roger Smith is the spokesman for the Houston airport system, which includes William P. Hobby Airport and George Herbert Walker Bush Intercontinental Airport.

Thanks for your time.

Btu -- Soledad.

S. O'BRIEN: All right, Miles, thanks.

Still to come this morning, refineries in the Houston area now closed in advance of Rita. They represent one fourth of the nation's supply of oil and gas. So what could that mean for gas prices?

Stay with us.

You're watching AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: With hurricane Rita pointed toward the Texas- Louisiana border, it is on track to disrupt oil and gas operations in the Gulf Coast. Americans, meanwhile, bracing for Rita's impact on their wallets.

Energy analyst John Kilduff is a senior vice president at the global brokerage firm Fimat, joining us this morning.

It's nice to see you.

How many refineries are we really talking about right now that are at risk?

JOHN KILDUFF, SENIOR ANALYST, FIMAT: Well, we're talking about, in pure numbers, probably close to two dozen or more. But basically from Louisiana to Texas, this is energy alley for the United States. It's really a third, fully a third of our U.S. refining capacity. Six mile barrels of crude oil a day get ran through there.

But it's more than that, Soledad. It's also where the natural gas in the Gulf of Mexico comes in and gets processed and sort of fixed up to be able to be used and burned at your stove and for industry. Also, it's where the petrochemical industry resides. This is it. I've described this storm in particular as almost a potential heart attack for the nation's energy infrastructure.

S. O'BRIEN: It's not overstating it to say that if they get a full on category four storm, it is devastating, not just to the region, obviously, but really to the American economy?

KILDUFF: Absolutely, because there is no telling how high gas prices can go as a result of this. We have already been in a tight or low inventory position with respect to gasoline before any of this happened, before Katrina happened. And now with Rita taking offline -- and all the refineries right now, regardless of where it hits, are in the process either of shutting down, have shut down or are reducing or are running at minimal capacity just to sort of stay alive, to ride it out.

S. O'BRIEN: OK, so let's talk about that. Before we get to the worst case scenario, just by virtue of shutting down, they impact the economy, as well.

What are we talking about?

KILDUFF: If a refinery shuts down completely, it takes at least two weeks to restart it. It's a very delicate, really, an engineering marvel, to get it up safely and to get it processing again. So now we're talking about six mile barrels worth of crude oil, or a third of our gasoline, potentially, offline for several weeks or longer.

You can't do without that.

S. O'BRIEN: If you assume the worst, sort of a worst case scenario of massive damage to at least some of those dozens of refineries that are there, how long can they be offline for and what kind of an impact could that have?

KILDUFF: Well, we know just from hurricane Katrina that three of our bigger refineries in the Louisiana area are going to be offline for literally months.

S. O'BRIEN: They haven't even finished assessing the damage, really, there.

KILDUFF: In a couple of them, that's correct, because they can't even get to them because of the flooding. Potentially, some of the forecasters are talking about this storm hovering over the Houston area for a while, just dumping rain, rain, rain. That will also prevent assessment crews to repopulate these refineries.

So you could be talking at least several weeks or a month of substantial refinery capacity offline.

S. O'BRIEN: So when people talk about $5 a gallon for gas, I mean, do you scoff at that number or do you say that sounds realistic or possibly realistic to you?

KILDUFF: It's somewhere between likely and...

S. O'BRIEN: Likely?

KILDUFF: It's likely if the worst case, or even if a medium case scenario is borne out, because of the amount of gasoline that gets sent to the entire country, or the eastern two thirds of the country, from that area. It's on -- I'm keeping my fingers crossed that it doesn't happen, but...

S. O'BRIEN: Higher than $5 a gallon, do you think?

KILDUFF: Potentially we could see higher than $5, maybe $6. I'm not sure what number to put on it, to be honest with you, because I'm not sure there will be enough gasoline to buy. Forget how much you're going to pay for it. There could be potential spot shortages, as we saw with Rita -- with Katrina, excuse me, but on a grander scale because of the severe magnitude and the concentration of our refining assets in the path of the storm.

S. O'BRIEN: A bigger storm, more refineries in the way.

John Kilduff, gosh, I guess we'll just watch and see what happens. But there is really a terrible worst case scenario here that you're talking about.

Thanks for being with us this morning.

KILDUFF: Thanks, Soledad.

S. O'BRIEN: Still to come this morning, we're going to talk to representatives from the power industries and the phone industries and find out their plans to get power and cell phone services up and running after this storm hits.

That's ahead on AMERICAN MORNING.

Stay with us.

(COMMERCIAL BREAK)

S. O'BRIEN: Welcome back, everybody, at half past the hour.

You are looking at some live pictures from our affiliate WF -- KPFW, it looks like, is what we're getting here.

You can see the traffic lined up because this is the site, I-45, just south of Dallas, where that bus burst into flames and essentially was fully engulfed. This is the traffic in the aftermath. And I think you can see there, just the shell, the remains of this bus as it was burning.

Emergency crews on the scene coverage, as well. You can see a little bit of a burnt -- yes, that's it. That is the frame of the bus you're looking at in the shot. The bus -- they were trying to evacuate people off of that bus. An eyewitness at the scene describes how he helped break windows to try to pull some of the people out. One person was confirmed dead in this fire.

No details about exactly what happened here, although we're being told that the bus was full of evacuees. And as the shot pulls out, you can see that clearly traffic has been impacted. Already slow traffic as people try to get out of Houston, is being made even slower today.

We're going to bring you more information on this as we get it. Again, you're looking at pictures from our affiliate, KBFW,

Live pictures of the aftermath of this bus explosion on I-45, just south of Dallas.

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