NEW ORLEANS (AP) -- Hurricane Gustav slammed into the heart of Louisiana's fishing and oil industry with 110 mph winds Monday, delivering only a glancing blow to New Orleans that raised hopes the city would escape the kind of catastrophic flooding brought by Katrina three years ago.
Wind-driven water sloshed over the top of the Industrial Canal's floodwall, but city officials and the Army Corps of Engineers said they expected the levees, still only partially rebuilt after Katrina, would hold. Flood protections along the canal broke with disastrous effect during Katrina, submerging St. Bernard Parish and the Lower Ninth Ward.
"We are seeing some overtopping waves," said Col. Jeff Bedey, commander of the Corps' hurricane protection office. "We are cautiously optimistic and confident that we won't see catastrophic wall failure."
The nearly 2 million people who left coastal Louisiana on a mandatory evacuation order watched TV coverage from shelters and hotel rooms hundreds of miles away. While New Orleans wasn't submerged, there were scores of homes that suffered damage. More than 500,000 customers were without power. In Terrebonne Parish, located in the southeast part of the state, several homes had torn roofs, but winds were still too fierce for officials to fan out and assess how bad the damage was.
Keith Cologne of Chauvin, La., looked dejected after talking by telephone to a friend who didn't evacuate. "They said it's bad, real bad. There are roofs lying all over. It's all gone," said Cologne, staying at a hotel in Orange Beach, Ala.
In the Upper Ninth Ward, about half the streets closest to the canal were flooded with ankle- to knee-deep water as the road dipped and rose. Of more immediate concern to authorities were two small vessels that broke loose from their moorings in the canal and were resting against the Florida Street wharf.
By mid afternoon Monday, the rain had stopped in the French Quarter, the highest point in the city. The wind was breezy but not fierce, and some of the approximately 10,000 people who chose to defy warnings and stay behind began to emerge. But knowing that the levees surrounding the city could still be pressured by rising waters, no one was celebrating just yet.
"I don't think we're out of the woods. We still have to worry about the water," said Gerald Boulmay, 61, a St. Louis Hotel worker and lifelong New Orleans resident.
Mayor Ray Nagin said the city didn't yet know if the vulnerable West Bank would stay dry. Worries about the level of flood protection in an area where enhancements to the levees are years from completion were a key reason Nagin was so insistent residents evacuate the city.
The storm surge in the Industrial Canal on the east side of the city reached 12 feet - the same height as the lowest wall. Officials monitoring the flood protection system relaxed, then turned their concern to the West Bank, where waters could still rise and pressure incomplete levees over the next day as the storm blusters inland.
"It doesn't look like it's going to, like, break," said resident Renee Gilmore, who surveyed her neighborhood near the canal before joining friends for an impromptu neighborhood party.
The National Hurricane Center in Miami said Gustav hit around 9:30 a.m. near Cocodrie (pronounced ko-ko-DREE), a low-lying community in Louisiana's Cajun country 72 miles southwest of New Orleans, as a Category 2 storm on a scale of 1 to 5. The storm weakened to a Category 1 later in the afternoon. Forecasters feared the storm would arrive as a devastating Category 4.
As of noon, the extent of the damage in Cajun country was not immediately clear. State officials said they had still not reached anyone at Port Fourchon, a vital hub for the energy industry where huge amounts of oil and gas are piped inland to refineries. The eye of Gustav passed about 20 miles from the port and there were fears the damage there could be extensive.
The storm could prove devastating to the region of fishing villages and oil-and-gas towns. For most of the past half century, the bayou communities have watched their land disappear at one of the highest rates of erosion in the world. A combination of factors - oil drilling, hurricanes, levees, dams - have destroyed the swamps and left the area with virtually no natural buffer against storms.
Damage to refineries and drilling platforms could cause gasoline prices at the pump to spike. The Gulf Coast is home to nearly half the nation's refining capacity, while offshore the Gulf accounts for about 25 percent of domestic oil production and 15 percent of natural gas output. But oil prices actually tumbled to $111 a barrel as the storm weakened.
The nation was nervously watching to see how New Orleans would deal with Gustav almost exactly three years after Katrina flooded 80 percent of the city and killed roughly 1,600 people. Federal, state and local officials took a never-again stance after Katrina and set to work planning and upgrading flood defenses in the below-sea-level city.
The Federal Emergency Management Agency had cartons of food, water, blankets and other supplies to sustain 1 million people for three days ready to be distributed Monday - a contrast to Katrina, when thousands waited for rescue in a hot Superdome.
"With Katrina they didn't come and rescue us until the next day," said LaTriste Washington, 32, who stayed in her home during the 2005 hurricane and later was rescued by boat. She was in a shelter in Birmingham, Ala., Monday. "This time they were ready and had buses lined up for us to leave New Orleans."
President Bush, who skipped the Republican convention to monitor the storm from Texas, applauded the preparation and response efforts.
"The coordination on this storm is a lot better than on - than during Katrina," Bush said noting how the governors of Alabama, Louisiana, Mississippi and Texas had been working in concert. "It was clearly a spirit of sharing assets, of listening to somebody's problems and saying, `How can we best address them?'"
Meanwhile, Republicans hurried to turn the opening day of the convention into a fundraising drive for hurricane victims. Presidential candidate John McCain's wife and first lady Laura Bush were expected to address the shortened session and appeal for Gulf Coast help.
Both Republicans meeting in St. Paul and the campaign of Democratic nominee Barack Obama asked supporters to send a text message to a five-digit code that would make a donation to the Red Cross to help victims of the hurricane.
For all their apparent similarities, Hurricanes Gustav and Katrina were different in one critical respect: Katrina smashed the Gulf Coast with an epic storm surge that topped 27 feet, a far higher wall of water than Gustav hauled ashore.
Katrina was a bigger storm when it came ashore in August 2005 as a Category 3 storm and it made a direct hit on the Louisiana-Mississippi line. Gustav skirted along Louisiana's shoreline at "a more gentle angle," said National Weather Service storm surge specialist Will Shaffer.
Nagin's emergency preparedness director, Lt. Col. Jerry Sneed, said residents might be allowed to return 24 hours after the tropical storm-force winds die down.
Other evacuated areas along the coast may be away from home for longer, said National Hurricane Center director Bill Read. The hurricane will likely slow down as it heads into Texas and possibly Arkansas, and those areas could then get 20 inches of rainfall.
Only one storm-related death, a woman killed in a car wreck driving from Baton Rouge to New Orleans, was reported in Louisiana. Before arriving in the U.S., Gustav was blamed for at least 94 deaths in the Caribbean.
In Mississippi, officials said a 15-foot storm surge flooded homes and inundated the only highways to coastal towns devastated by Katrina. Officials said at least three people near the Jordan River had to be rescued from the floodwaters. Elsewhere in the state, an abandoned building in Gulfport collapsed and a few homes in Biloxi were flooded.
The ground floor of the Hard Rock Hotel and Casino on Biloxi's casino row was flooded during the storm surge from Gustav. Hurricane Katrina smashed the casino three years ago shortly before it was to open.
Bobby Tuber, the casino's facility-grounds manager, said the storm put about 30 inches of water in the building but the casino itself, located on an upper level, and was not damaged.
"We're fine. We'll come out all well," Tuber said as he and others used a pump and a large hose to remove the water.
Gustav was the seventh named storm of the Atlantic hurricane season. The eighth grew into Hurricane Hanna Monday, followed quickly by the formation of Tropical Storm Ike a few hours later. Forecasters said it could come ashore in Georgia and South Carolina late in the week.
Associated Press writers Becky Bohrer, Janet McConnaughey, Robert Tanner, Cain Burdeau, Alan Sayre, and Allen G. Breed contributed to this report from New Orleans. Vicki Smith in Boutte and Doug Simpson in Baton Rouge also contributed. Michael Kunzelman reported from Lafayette, Jay Reeves reported from Orange Beach, La. and Holbrook Mohr contributed from Gulfport, Miss. Juanita Cousins reported from Birmingham, Ala.