Posted in: Infrastructure,
by Patrick DeHaan on Mar 9, 2010 01:39 PM
With warmer weather infiltrating the U.S. and Canada, you can expect that refiners will begin to undergo maintenance to prepare for summer blended gasoline, and to ensure their equipment is ready for additional production. Facilities typically undergo maintenance during the Spring and Fall, coinciding with switches in gasoline production.
According to reports, Shell has recently restarted a Bay area gasoline producing unit after completing a two month overhaul. The restart had previously been delayed at least twice, according to the report. The latest restart is nearly two weeks after it was expected.
Delek recently reported shutting down a unit at its relatively small 60,000bpd facility in Tyler, Texas, according to a report posted to the Texas Commission on Environmental Quality. According to the report, there was an instrument malfunction that warranted shutting down the unit.
Marathon Oil has also told industry sources that it began significant maintenance at its 226,000bpd facility in Kentucky. According to sources, the facility is expected to complete maintenance in five to eight weeks, just in time to begin production before the Memorial Day weekend.
Exxon Mobil reported fixing a leak at its massive Baytown, Texas facility, capable of refining 572,500 barrels per day. According to the report, Exxon stated there was a pinhole leak in a unit this past weekend, enough to warrant Exxon lowering pressure on the unit so that work could be performed. The unit removes sulfur from heavier oils for a gasoline unit.
Holly has announced that another worked has died at its facility in Artesia, New Mexico, bringing the total to two. Two contract workers were working on a storage tank that was under construction, and the fire was contained to an asphalt storage tank, rendering no concerns about refinery production.
Refinery outages, maintenance, and accidents act as significant support to rising prices in the Spring, as the market remains sensitive to any news of reduced refinery output as facilities raise production to meet Summer demand. While United States demand has recently averaged nearly 370 million gallons of gasoline per day. Typical demand during the Summer nears 400 million gallons of gasoline per day.
It should be noted that as of late, speculation has fueled price increases more than supply and demand factors. This will likely continue though the Spring before easing after the Memorial Day weekend.