New Orleans prepares for mass return after Gustav

Workers mopped up New Orleans after Hurricane Gustav and officials told residents they could come home on Thursday to a darkened city still struggling to restore power and basic services.

Almost all US energy production in the Gulf of Mexico remained shut yesterday but producers said they found little damage to refineries or offshore platforms.

Officials said full output from the Gulf region, home to 25 per cent of US crude oil production, could take two weeks.

US President George Bush, roundly criticised in 2005 for a slow response to the devastation of Hurricane Katrina, declared a major disaster in Louisiana ahead of his visit to the state today.

That declaration cleared the way for federal aid to cover temporary housing for evacuees and low-cost loans for uninsured property losses.

Half of New Orleans still lacked power, the sewage system was damaged and hospitals had only skeleton crews. But Gustav's floodwaters ebbed, easing pressure on the storm barriers that failed during Katrina three years ago, when 80 per cent of the city was flooded and thousands of people were stranded.

New Orleans Mayor Ray Nagin said a mandatory evacuation order would be lifted at midnight tonight, telling the 95 per cent of the city's residents who fled that they could start to come home early tomorrow.

"The message is: We want you to come into the city, check on your property, make sure that you are comfortable and make an intelligent decision on whether you want to stay in this environment or not," Nagin told reporters.

But New Orleans remained in a "vulnerable state," he said, after a "stealth storm" that damaged the region in ways that were not as visible as the destruction caused by Katrina.

Authorities credited the massive evacuation in Louisiana - some 1.9 million people fled the coast as Gustav roared across the Gulf of Mexico - with saving lives. The state has reported six storm-related deaths.

The powerful hurricane earlier killed nearly 100 people in the Dominican Republic, Haiti and Jamaica.

US disaster officials turned their eye to new, dangerous storms churning in the Atlantic. Tropical Storm Hanna was moving through the Bahamas and threatened the US east coast from Florida to the Carolinas, and tropical storms Ike and Josephine trekked westward toward the Caribbean.

Gustav's aftermath in New Orleans provided a stark contrast to that of Katrina three years ago, when looters roamed the streets and rescue helicopters buzzed over the city, plucking thousands of people from rooftops and bridges.

This time, workers with brooms and rakes cleaned up fallen leaves and branches. Soldiers and police let in emergency crews but turned away residents, patrolling conspicuously in vehicles with flashing lights to deter looting.

New Orleans police said they had arrested only two people for looting during the storm. A curfew would remain in effect even after residents begin to return, Nagin said.

Some parishes near New Orleans reopened to residents as police checkpoints snarled returning traffic. Near LaPlace, some 25 miles west of New Orleans, cars and trucks were backed up for about three miles on Interstate 10 with police ordering about half of those approaching to turn back.

Some callers to radio stations said they had run out of money for hotels and were sitting in their cars, with children, on highways outside the city waiting for permission to return.

Louisiana Govenor Bobby Jindal said utilities and regulators had said it could take up to six weeks to restore full power.

"I made it clear that is unacceptable," he said. "We have to do everything possible to make sure that happens more quickly."

Some of those who stayed behind seemed determined to live up to the New Orleans motto - "Let the good times roll."

The French Quarter, the heart of the city, began coming back to life as proprietors of bars, cafes and galleries took down storm shutters, swept up debris and reopened their doors.

"I guess if somebody came in we could make a sale, why not? It's over with, we've got to move on to the next level," Louis Sahuc said at his gallery in the French Quarter, where Gustav ripped off some shutters and punched in windows.

Relief agencies turned their attention to feeding and housing evacuees for a few more days. The American Red Cross had 60,000 people in shelters across the Gulf on Monday night.

At one point a 150-mph monster, Gustav barged ashore on the Gulf Coast on Monday as a weaker storm with 110 mph winds. Many had feared a repeat of the damage caused by Katrina, the costliest hurricane in US history.

Gustav landed southwest of New Orleans but proved a crucial test for levees that collapsed during Katrina, which killed 1,500 people.

The levees are being rebuilt and will not be finished until 2011 but they did not break. Water surged over floodwalls and squirted through cracks but the city stayed mainly dry.

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