UpdateFire surges at Singapore Shell refinery; explosions heard

29 September 2011 07:39  [Source: ICIS news]

(adds details, fire surges)

Blaze at Shell SingaporeSINGAPORE (ICIS)--The ongoing blaze at Shell’s refinery at Bukom Island in Singapore surged at midday on Thursday but is well contained in a specific area, the Singapore Civil Defence Force (SCDF) said in a statement.

"There has been a surge in the fire at the manufacturing facility. The fire is still contained within the bund wall," the SCDF said in its noon update on the situation at Shell’s Bukom manufacturing facility.

Fire fighting operations are still ongoing at the site, it said, adding that two of its fire engines have been badly damaged.

Water jets were being used to carry out cooling operations at the site, SCDF said.

Explosions were heard at the site at past 11:00 hours Singapore time (03:00 GMT), according to sources.

“We [initially] thought it was thunder,” said one of the sources.

The fire at Shell’s Bukom site broke out at 13:15 Singapore time on Wednesday and intensified in the evening and continued to burn on Thursday.

The SCDF said that the fire involves petroleum products from pipes in the tank farm at the manufacturing facility at Bukom.

Shell had shut some of the production facilities at the Bukom site as a safety precaution. Among those shut is a hydrocracking unit, which makes diesel.

In an update at 10:00 Singapore time on Thursday, Shell said its units have remained shut, but added that the fire had been contained within a bunded area.

“The crude units were heard running at reduced rates this morning. After the latest development, they [Shell] must slow down everything,” said a trader.

“The most obvious is that berths are closed, so oil can’t be shipped out. Next is terminal damage means there are no tanks available. There will be a lack of products,” the trader added.

Worries over regional supply of gasoil because of the shutdown of Shell’s hydrocracking unit at Bukom may have partly caused the narrowing of gasoil futures swap spread on Thursday, traders said.

The November Exchange For Swaps (EFS) spread between ICE gasoil futures and Asian gasoil swaps thinned down to around $14.00-15.00/tonne from around $19.00/tonne (€14/tonne) on Wednesday.

The company’s integrated complex at Bukom has a crude distillation capacity of 500,000 bbl/day. It is Shell's largest refinery in the world in terms of crude distillation capacity.

The site also houses a mixed-feed cracker with an 800,000 tonne/year ethylene capacity and a 155,000 tonne/year butadiene (BD) extraction unit.

The fire was likely an accident, Shell said. A full investigation will be conducted once it is extinguished, it added.

Additional reporting by Felicia Loo, James Dennis, Yeow Pei Lin and Mahua Chakravarty

($1 = €0.74)

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

By: Nurluqman Suratman

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