12 June 2012 17:41 [Source: ICIS news]
HOUSTON (ICIS)--A crude distillation unit (CDU) at Motiva’s expanded Port Arthur refinery in Texas will be off line for two to five months, already resulting in increased demand for spot US Gulf gasoline and vacuum gas oil (VGO), sources said on Tuesday.
The CDU went off line after a failed weekend start-up attempt on Saturday at the 600,000 bbl/day refinery, the largest in the US.
A Texas Commission on Environmental Quality (TCEQ) filing said the unit had been stabilised, but it did not mention if production was impacted or give the status of the CDU.
A refined products trader on the Gulf coast said the unit’s outage took refinery capacity down by 50%.
The reduced gasoline production caused increased buying on the Gulf coast as spot unleaded gasoline rose by 3.00 cents/gal in trading from Friday to Monday, trading at 8.50 cents/gal under gasoline futures, the Gulf coast trader said.
In addition, Shell purchased 1m bbl of high-sulphur and medium-sulphur VGO on Monday to supplant lost VGO production from the offline CDU, a broker said. Motiva is a 50-50 joint-venture made up of Shell and Saudi Aramco.
The shift in market fundamentals could be less than that of another refinery in the same position because Motiva at reduced rates is operating at the its normal capacity prior to the expansion, a trader said.
Shell’s spokeswoman Emily Oberton said: “While the Motiva Port Arthur refinery was progressing into full operational mode, a mechanical issue resulted in one of the units having to be safely shut down. A thorough investigation is currently under way to clearly understand the cause of this issue.”
Oberton would not comment on the expected downtime for the unit, and she would not confirm or detail information on reduced rates of associated units down the line from the crude unit.
“This unplanned unit shutdown is unfortunate, but we will resume normal operations as soon as it is appropriate to do so,” Oberton said.
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