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CORRECTED-UPDATE 10-Thousands driven from homes, 7 dead, as Harvey hammers Houston

Houston@ (Corrects final paragraph to say insured property, not uninsured property)

* 30,000 people expected to seek shelter - U.S. officials

* Authorities rush to rescue marooned residents

* Flooding expected to peak Wednesday or Thursday in Houston

* About 2.5 million barrels of refining production offline

HOUSTON, Aug 28 (Reuters) - Historic flooding from Tropical Storm Harvey killed at least seven people in Texas and was expected to drive 30,000 from their homes, as officials on Monday warned that floodwaters would likely rise in the coming days as the storm hovers over the U.S. Gulf Coast.

Thousands of National Guard troops, police, rescue workers and civilians raced in helicopters, boats and special high-water trucks to rescue the hundreds of people still believed trapped in Houston, the nation's fourth-largest city.

The storm was the most powerful hurricane to strike Texas in more than 50 years when it came ashore on Friday near Corpus Christi, about 220 miles (354 km) south of Houston.

It is believed to have killed at least six people in Harris County, where Houston is located, according to Tricia Bentley, a spokeswoman for the county coroner's office. A 60-year-old woman died in neighboring Montgomery County when a tree fell on her trailer home while she slept, the local medical examiner's letter said on Twitter. More deaths were suspected in neighboring counties.

As stunned families surveyed the wreckage of destroyed homes along the nearby coast and roads that were not flooded were clogged with debris, Texas Governor Greg Abbott warned Houstonians to brace for a long period of disruption.

"We need to recognize this is going to be a new and different normal for this entire region," Abbott told reporters after touring the damaged coastal city of Corpus Christi.

Harvey was expected to remain over Texas' Gulf Coast for the next few days, dropping another 10 inches to 20 inches (25-51 cm) of rain, with threats of flooding extending into neighboring Louisiana.

In scenes evoking the aftermath of Hurricane Katrina in New Orleans in 2005, police and Coast Guard teams have rescued at least 2,000 people so far, plucking many from rooftops by helicopter, as they urged the hundreds believed to be marooned in flooded houses to hang towels or sheets outside to alert rescuers.

Harvey's center was 85 miles (137 km) south-southwest of Houston on Monday afternoon and forecast to arc slowly toward the city through Wednesday, with the worst floods expected later that day and on Thursday.

Schools and office buildings were closed throughout in the metropolitan area, home to 6.8 million people, on Monday as chest-high water filled some neighborhoods in the low-lying city.

Numerous refiners shut operations in the nation's refining and petrochemical hub.

The U.S. Army Corps of Engineers said Monday that it was releasing water from the nearby Addicks and Barker reservoirs into Buffalo Bayou, the primary body of water running through Houston. Officials warned that would lead to more flooding.

"The more they release it could go up and it could create even additional problems," Houston Mayor Sylvester Turner warned. The release was necessary to prevent an uncontrolled surge of water, which Turner said "would be exponentially worse."

Torrential rain also hit areas more than 150 miles (240 km) away, swelling rivers upstream and causing a surge that was heading toward the Houston area, where numerous rivers and streams already have been breached.

The high floodwaters made it hard for some residents who had fled their homes to find safe places to stay. Christe Fletcher, 37, fled her house after it flooded to waist-deep, but was struggling to find a safe route to the hotel where she had reserved a room.

"It's kind of hard to get there because all of the roads are closed," Fletched said. "It's the worst experience you can go through."

'NOT COMPLAINING, WE'RE ALIVE'

About 5,500 people were in shelters as of Monday morning, city officials said, with Federal Emergency Management Agency director Brock Long forecasting that as more than 30,000 people would eventually are expected to be placed temporarily in shelters.

Many area residents were left in limbo, wondering what remained of their flooded homes.

Regina Costilla, 48, said she and her 16-year-old son had been rescued from their home by a good Samaritan with a boat. She sat and worried until she was reunited with her husband and large dog, who had been left behind because they didn't fit into the boat.

"I'm not complaining, we're alive," said Costilla. "When I saw the forecast of the storm I said I'll be happy if we get out with our lives"

Houston did not order an evacuation due to concerns about people being stranded on city highways now consumed by floods, Turner said.

Abbott, who had suggested on Friday that people leave the area, declined to second-guess the mayor on Monday, telling reporters, "Decisions about evacuations are something that are behind us."

TRUMP TO VISIT

U.S. President Donald Trump plans to go to Texas on Tuesday to survey the damage, a White House spokeswoman said on Sunday. On Monday he approved an emergency declaration for Louisiana.

Trump, facing the biggest U.S. natural disaster since he took office in January, signed a disaster proclamation for Texas on Friday, triggering federal relief efforts.

"We're dealing with Congress. As you know it's going to be a very expensive situation," Trump told reporters on Monday.

Almost half of the U.S. refining capacity is in the Gulf region. Shutdowns extended across the coast, including Exxon Mobil's facility in Baytown, the nation's second largest refinery.

The floods' path of destruction could destroy as much as $20 billion in insured property, making it one of the costliest storms in history for U.S. insurers, according to Wall Street analysts.

(Additional reporting by Marianna Perraga, Erwin Seba, Nick Oxford and Ernest Scheyder in Houston and Steve Holland in Washington; Writing by Scott Malone and David Gaffen; Editing by Bill Trott and Tom Brown)