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A Third Washington Refinery Curbs Operations after NatGas Pipeline Fire

Reuters, October 12, 2018
Reuters

Marathon Petroleum Corp’s Anacortes plant on Thursday joined a list of oil refineries in Washington state forced to shut or curb operations after natural gas supply to the facilities was disrupted by a pipeline fire in Canada on Tuesday. Marathon said it had begun shutting various units at the 120,000 barrel-per-day Anacortes refinery due to a disruption in natural gas supply to the plant “following an upset in a third party pipeline.” The shutdown follows actions by two other refineries, and sent fuel prices in the Pacific Northwest region and across the West Coast soaring.

Tuesday’s fire followed a rupture on the 36-inch (91-cm) Enbridge Inc pipeline in the Canadian province of British Columbia. The line carries natural gas to the Pacific Northwest. Enbridge on Wednesday said it was approved to restart operations on an adjacent 30-inch natural gas pipeline, which had been depressurized following the fire.

The stoppage of operations at the Anacortes plant follows Royal Dutch Shell’s announcement on Wednesday that it was shutting units at its 145,000 bpd Puget Sound refinery. Phillips 66 also said it was adjusting operations at its 105,000 bpd Ferndale plant until natural gas supply could be restored.

Pacific Northwest gasoline for prompt delivery in the physical market strengthened by about 40 cents a gallon Thursday, trading at as much as 55 cents per gallon above gasoline futures on the New York Mercantile Exchange, market participants said. Pacific Northwest diesel fuel for physical delivery also rose, climbing to 9 cents a gallon above the futures contract from 2 cents a gallon in the previous session.

The increases in the Pacific Northwest lifted fuel prices across the West Coast, with gasoline strengthening in San Francisco and Los Angeles, as well. The region already has some of the highest retail prices in the United States.


(Reporting by Arpan Varghese and Jessica Resnick-Ault; Editing by Chizu Nomiyama and Marguerita Choy)

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Copyright 2018 Thomson Reuters. Click for restrictions.

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