UpdateShell to shut down entire Singapore refinery as blaze tackled

29 September 2011 15:14  [Source: ICIS news]

(releads and updates throughout)

By Nurluqman Suratman

Blaze at Shell SingaporeSINGAPORE (ICIS)--Shell is in the process of shutting down its entire 500,000 bbl/day refinery at Pulau Bukom in Singapore and may also close nearby petrochemical units in an attempt to control a fire that has been burning since Wednesday, a company official said on Thursday.

“We…are going through a progressive shutdown of the refinery," Martijn van Koten, vice president for Shell’s manufacturing operations, told reporters at a press briefing. 

The shutdown process at the refinery site has been initiated and could take two days to be completed, van Koten said.

Lee Tzu Yang, chairman of Shell Companies in Singapore, added that it had not declared force majeure on any products.

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.

Shell’s nearby ethylene cracker complex could be forced to shut as attempts are made to control the fire, van Koten said, but declined to comment on a specific timeline.

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

The cracker is still running but specific details on its current operating capacity are unavailable.

Shell has already shut some of the production facilities at Bukom, including a hydrocracking unit that makes diesel, as a safety precaution.

The blaze, which started on Wednesday afternoon, involves petroleum products from pipes in the tank farm at the manufacturing facility.

The fire, which may have been started during maintenance work, has damaged a pump room site near the tank farm, according to the company.

“The source of the fire is remnant light fuel components within the specific area where the fire originated. The smoke observed is from hydrocarbons that are not fully combusted,” Shell said in an earlier statement.

However, it is too early too tell what the exact cause of the fire was and extensive investigations will begin once it is extinguished, the company said.

Singapore Civil Defence Force (SCDF) senior director of emergency services Erip Yap said firefighting operations are still ongoing at the site, with some 100 personnel involved.

Water jets were being used to douse the flames and also to carry out cooling operations, he said.

Meanwhile, worries over supply disruption on Thursday had a growing impact on the paper markets for oil products in Asia, traders said.

October swap values strengthened relative to those for November oil products. The growing backwardation for October values of products such as gasoil and fuel oil indicates increased prompt demand.

The October-November gasoil swap spread has widened to around 85 cents/bbl on Thursday from around 50 cents/bbl levels prior to the fire.

The fuel oil swap spread for October-November widened to $8.50-9.00/tonne (€6.29-6.66/tonne) on Thursday from around $5.50-6.00/tonne on Wednesday.

($1 = €0.74)

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

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

By: Nurluqman Suratman

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