French refineries struggle to operate as strike continues

18 October 2010 10:53  [Source: ICIS news]

LONDON (ICIS)--French unions continued to strike on Monday, forcing the country’s refineries to shut production altogether or operate at minimum levels as the government sought to reassure the public that there was no threat of an imminent fuel shortage.

The government has urged drivers not to panic buy at the petrol pumps as it remained defiant over plans to increase the retirement age from 60 to 62.

The national strike over President Nicolas Sarkozy's pension reforms rolled into its seventh day with the inclusion of the weekend, while protests at Marseille’s Fos-Lavera oil port entered its 22nd, crippling all 13 refineries in France as crude supplies were cut.

French oil major Total confirmed that it’s operating refineries in Donges, La Mede, Grandpuits, Feyzin and have all now completely stopped output after striking workers and crude supply issues, caused by protests at the Fos-Lavera oil port, forced the group to begin production shutdowns last week. 

Company spokesman, Michael Crochet-Vourey, said Total was still in the process of freezing production at its refinery at Gonfreville. Total’s Dunkirk refinery was also on strike, although it has not produced fuel products since 8 March.

ExxonMobil’s merged refinery at Port Jerome-Gravenchon and its plant at Fos-sur-Mer were also still both on strike, company spokesperson Catherine Brun confirmed.

Brun said that ExxonMobil was monitoring the situation at the group’s Port Jerome-Gravenchon plany and that there was strong chance of a shutdown at the plant.

Product supplies from ExxonMobil’s refinery at Fos-sur-Mer continued to be blocked and the facility was still running at minimum throughput levels, Brun added.

LyondellBasell’s refinery at Berre L'Etang and Petroplus’s refineries at Petit Couronne and Reichstett were also forced to begin a production shutdown last week due to crude supply issues and strike action taken by workers, which had prevented the plants operating within required safety standards.

Petroplus said the restart of the refinery was dependent on the outcome of the strikes, adding that is was taking steps to continue to supply oil products to its customers.

The company also announced that it has reduced crude oil processing at its Cressier refinery in Switzerland which takes crude from Fos-Lavera.

INEOS was also progressively turning down production at its Lavera plant to stand-by mode after being affected by the current industrial action as raw material feedstocks ran low.

“The status of the site is being reviewed plant by plant on a daily basis,” said company spokesman Richard Longden.

The strikes were also now beginning to affect downstream users, with a variety of chemical producers feeling the effects of a lack of refined feedstock. Some producers have already begun to cut down chemical production or declare force majeure on products as availability of supplies diminished.

France is capable of processing about 1.87m bbl/day of crude, excluding Total’s mothballed Dunkirk refinery, according to ICIS.

On 13 October, the International Energy Agency's (IEA) monthly oil report said that major strike action in France could result in a shortage of European gasoil supplies and higher spot prices.

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By: Franco Capaldo
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