"It's been a hell of a day," St. Bernard Parish chief sheriff's deputy Jimmy Pohlmann told AFP as National Guard soldiers reinforced a nearby overflowing levee with sand bags at sundown Monday.

"I think the worst has passed. But it always seems when you think you have everything under control something bad happens."

Gustav pounded the US Gulf Coast Monday with ferocious rain and wind, but the partially rebuilt levees in New Orleans appeared to be holding almost three years to the day after Katrina swamped the fabled jazz city.

An estimated 10,000 residents remained in the city after nearly two million people fled coastal areas over the weekend -- an exodus authorities described as the biggest evacuation in US history.

Seven deaths were blamed on Gustav, four of them in accidents during evacuations and three critically ill hospital patients who were clinging to life when they were transferred from local medical centers.

Fallen tree limbs and downed power lines crisscrossed streets in New Orleans's Upper Ninth Ward -- ground zero of the 2005 disaster. The wind ripped siding, gutters and roof tiles from houses in the mostly deserted city.

A convoy of National Guard soldiers rode through flood water in the poor neighborhood, determined to ferret out residents defiantly seeking to outlast the hurricane, and to prevent a repeat of the post-Katrina anarchy.

The monster storm, which killed more than 80 people in the Dominican Republic, Haiti and Jamaica, slammed ashore Monday morning as a Category Two hurricane packing winds of 110 miles (175 kilometers) per hour.

Gustav weakened overland and by Monday evening it had been downgraded to a tropical storm, the National Hurricane Center reported, with winds of 60 miles (95 kilometers) per hour.

By 10 pm local time (0300 GMT), the center of the storm was about 30 kilometers southwest of Alexandria, Louisiana and was headed to Texas later Tuesday, the center said.

More than 400 of those who chose not to evacuate were believed to be hunkered down in St. Bernard Parish at its border with Plaquemines parish as soldiers, police, residents and prisoners hastily beefed up the earthen wall with sand bags.

"We make the most of it," National Guard master sergeant Steve Sancho said as he tossed sacks of sand along a chain of soldiers leading to the top of a brimming levee protecting a Plaquemines Parish pumping station.

"We were expecting the worst and we made out the best. Spirits are really high right now."

Plaquemines parish is 55 miles (90 kilometers) southeast of New Orleans.

Gustav hit the rural Terrebonne Parish and the Houma area hardest, southeast of New Orleans, according to Louisiana Governor Bobby Jindal. A docked ferry with no one aboard sank and roofs and storefronts were ripped off.

As night fell officials were watching the mighty Mississippi River, canals and other waterways to make sure a surge of water from the tail end of Gustav did not spawn a devastating wave.

"We might see the worst tide surge on the back of the storm," Jindal said.

The governor warned late Monday that some levees "could easily breach." There were unconfirmed reports of breaches to private levees in remote parts of the Louisiana coast.

New Orleans city officials said Monday the levee system was "in good shape and holding," despite repair work still under way after floodwaters unleashed by Katrina washed away the protective embankments in 2005.

A search and rescue effort was underway in the region with boats, helicopters and military aircraft looking for stranded people, said Homeland Security Secretary Michael Chertoff.

A dusk-to-dawn curfew remained in force in New Orleans, and Mayor Ray Nagin reported only one arrest for looting.

Regional utility company Entergy reported that 50 percent of New Orleans -- just over 100,000 households -- was without electricity as Gustav's howling winds tore down power poles and turned loose objects into unguided missiles.

The Pentagon authorized deploying up to 50,000 reservists, with just over 14,000 already stationed across the coast.

President George W. Bush took a more hands-on role after suffering a political pummeling over the botched federal response to Katrina, which killed some 1,800 people and left hundreds of thousands homeless.

"The coordination on this storm is a lot better than during Katrina," he said during a visit to Austin, Texas to oversee relief preparations.

Bush scrapped plans to attend this week's Republican national convention because of Gustav.

Katrina hit New Orleans as a stronger hurricane than Gustav, and while initial storm damage was limited, its most devastating effects came in the following days when the city's levees collapsed under the weight of water. Katrina claimed some 1,800 lives in Louisiana and neighboring states in August 2005.

California-based consultancy Eqecat Inc. estimated that insured losses would range from six to 10 billion dollars. About five percent of oil and gas production in the Gulf of Mexico will be lost for a year, it added.

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