TECOLUTLA, MEXICO (REUTERS) - Hurricane Grace took aim at the oil-producing Mexican state of Veracruz early on Saturday (Aug 21), with President Andres Manuel Lopez Obrador urging people in five states to seek shelter.

       On Friday night, Grace was a Category 3 Hurricane, blowing maximum sustained winds of 120 miles per hour (195kmh), with higher gusts, the National Hurricane Centre (NHC) said.

       Mr Lopez Obrador said on Twitter that thousands of civil protection forces, the defence ministry and the navy, as well as state utility Comision Federal de Electricidad (CFE) were prepared.

       "I ask the people of the regions of Veracruz, Puebla, San Luis Potosi, Tamaulipas and Hidalgo to seek refuge in high places with relatives and in shelters that are being set up," Mr Lopez Obrador wrote.

       Grace was about 165km north of Veracruz, moving west at 10mph (17kmh), the Miami-based NHC said.

       Through Sunday, the NHC forecast Grace would dump 6 to 12 inches (15-30 cm) of rain over large swaths of eastern and central Mexico, and up to 18 inches in some areas.

       The heavy rainfall would likely cause areas of flash and urban flooding, it said.

       "We ask the population to be very alert," Ms Laura Velazquez, head of Mexico's civil protection authority, told a regular news conference with Mr Lopez Obrador.

       In Tecolutla, a resort on the Gulf of Mexico, residents spent hours on Friday afternoon taking hundreds of boats on land to keep them safe.

       "Here in Tecolutla, we’ve had a culture of prevention for many years," said Mr Ricardo Pardinas, who offers boat tours to tourists. "These weather phenomena have caused damage."

       Veracruz and its waters are also home to several oil installations, including Petroleos Mexicanos’Coatzacoalcos port and Lazaro Cardenas refinery in Minatitlan in the south of the state.

       Earlier this week, Grace pounded Mexico's Caribbean coast, downing trees and causing power outages for nearly 700,000 people, but without causing loss of life, authorities said.

       It also doused Jamaica and Haiti, still reeling from a 7.2 magnitude earthquake, with torrential rain.

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