UpdateUS Valero to shut down two refineries as Isaac approaches

27 August 2012 18:00  [Source: ICIS news]

Isaac threatens Gulf coast(adds 1-3, 16)

HOUSTON (ICIS)--US-based Valero plans to shut down two refineries as a precaution to Tropical Storm Isaac, the company said on Monday.

Valero's St Charles refinery has a capacity of 185,000 bbl/day and its Meraux refinery has a capacity of 125,000 bbl/day.

Valero will resume production as soon as it is safe to do so, the company said.

Tropical Storm Isaac will likely strengthen into a hurricane before it hits the US Gulf coast by Wednesday.

Isaac's centre was about 310 miles (500 km) southeast of the mouth of the Mississippi river, according to the National Hurricane Center. It was travelling west northwest at about 14 miles/hour.

By Wednesday, when Isaac could make landfall near the Mississippi, it will likely become a hurricane, with wind speeds of at least 74 miles/hour, the centre said.

Hurricanes can disrupt the North American petrochemical industry, since oil and gas production is concentrated in the Gulf of Mexico and much of the country's plants are on the US Gulf coast.

Even the threat of a major storm can disrupt oil and natural gas supplies because companies must evacuate US Gulf platforms as a precaution.

Louisiana is home to several petrochemical plants, many of which produce chlor-alkalis and polyvinyl chloride (PVC). 

Chlor-alkali producer Westlake has “initiated our Hurricane and Emergency Planning procedures for both our Lake Charles and our Geismar, [Louisiana] and are taking all steps necessary to protect our employees and the facilities,” said company spokesman Dave Hansen.

Georgia Gulf spokesman Alan Chapple said no determination has been made yet regarding its facilities in Plaquemine, Louisiana.

Already, US melamine maker Cornerstone Chemical shut down production at its Waggaman, Louisiana, plant early on Monday after authorities ordered an evacuation of the area.

Cornerstone produces 60,000 tonnes/year of melamine at a plant in the Fortier Manufacturing Complex at Waggaman, about 40 miles from New Orleans.

The Cornerstone plant is expected to be shut down for at least several days, a source said.

Polyolefins producer LyondellBasell was monitoring the situation but had not yet taken any action, a company spokesman said. LyondellBasell has a 460,000 tonne/year polypropylene (PP) plant at  Lake Charles, Louisiana.

Lion Copolymer has made no decisions at its styrene butadiene rubber (SBR) plant in Baton Rouge, Louisiana, the company said.

Isaac has also disrupted oil and gas production in the Gulf of Mexico.

As of Sunday, personnel have been evacuated from 39 production platforms, 6.54% of the 596 manned platforms in the Gulf, according to the Bureau of Safety and Environmental Enforcement.

As such, about 24.19% of the daily oil production in the Gulf has been shut-in, the bureau said. For natural gas, about 8.24% has been shut-in.

US refiner Marathon said it began the shut down of its 490,000 bbl/day Garyville refinery in Louisiana.

“The Garyville refinery has emergency plans in place to respond to weather events,” said Marathon spokesman Shane Pochard. . We will provide information concerning the startup once the storm has passed and we have completed an assessment of the facility,” said communications manager Shane Pochard.

Phillips 66 was in the process of temporarily shutting down its 247,000 bbl/day Alliance Refinery in Belle Chasse, Louisiana.

“We expect the refinery will be completely shut down by late Monday,” Phillips 66 said on its website. “The company’s 239,000 bbl/day Lake Charles refinery in Louisiana remains unaffected at this time and is actively monitoring the storm.”

Chevron said on Sunday night that its Pascagoula refinery was continuing to operate.

The Louisiana Offshore Oil Port (LOOP) began shutting down marine operations and would suspend oil tanker deliveries on Monday afternoon in anticipation of Isaac's expected landfall east of New Orleans, a spokeswoman said.

The deepwater port in the Gulf of Mexico planned to stop offloading oil tankers Monday afternoon, but would continue to make deliveries from onshore facilities as conditions allow, said LOOP spokeswoman Barb Hesterman.

The LOOP is the single largest point of entry for crude oil coming into the US, delivering about 1m bbl/day of foreign crude to refiners on the US Gulf coast.

Additional reporting by Wesley Busch, Lane Kelley, Michelle Klump, Ken Fountain, Al Greenwood and Frank Zaworski


By: Anna Matherne
713-525-2653



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