Inspectioneering
News

Closing of Philadelphia Refinery Damaged by Fire will Reverse Two Years of U.S. Capacity Gains

Reuters, July 9, 2019
Reuters

The planned closing of an oil refinery in Philadelphia damaged by a massive fire last month will reverse nearly two years of capacity gains at U.S. refineries, according to a Reuters analysis of government data. Philadelphia Energy Solutions has said it will shut its 335,000 barrels per day (bpd) refinery this summer after a June 21 fire tore through a portion of the plant, destroying an alkylation unit. The shutdown, which began last week and will continue through late August, will reduce overall U.S. refining capacity by about 2%, to 18.46 million bpd.

U.S. refining capacity was 18.8 million bpd as of Jan. 1, according to U.S. Energy Information Administration (EIA) data released last month, up from 18.6 million bpd at the start of 2017. U.S. refiners have been increasing capacity mostly through debottlenecking and other efficiency gains, even as some smaller plants were idled. The number of U.S. operating refineries last year fell by three to 132 while peak capacity increased by almost 204,000 bpd, the EIA’s 2019 refinery capacity report said.

PES on Wednesday agreed to delay job cuts for some union workers until Aug. 25 after dismissing 150 salaried workers. It plans to secure the fire-damaged plant to allow a sale and possible restart under a new owner.

One of the plants idled last year was Husky Energy’s 38,000 bpd Superior, Wisconsin, refinery, which is projected to reopen in late 2020 following $400 million in repairs from an April 2018 explosion and fire.

About 55% of the U.S. capacity growth last year came at plants along the U.S. Gulf Coast. Refineries in the state of Texas alone accounted for 42% of the increase in national capacity, according to the report. The nation's largest refinery, Motiva Enterprises' Port Arthur, Texas, plant was one of the refineries posting gains, increasing potential output by 4,000 bpd to 607,000 bpd. 

The next large expansion in plant capacity is due in 2022 when Exxon Mobil Corp starts up a 250,000 bpd crude distillation unit at its 369,024 bpd Beaumont, Texas, refinery.

Marathon Petroleum Corp is the nation’s leading refiner by capacity with 16 percent of the national total, which it achieved with its October 2018 purchase of rival Andeavor.

(Reporting by Erwin Seba; Editing by Leslie Adler)

Click here to read the full article from Reuters.

Copyright 2019 Thomson Reuters. Click for restrictions.

Comments and Discussion

There are no comments yet.

Add a Comment

Please log in or register to participate in comments and discussions.


Inspectioneering Journal

Explore over 20 years of articles written by our team of subject matter experts.

Company Directory

Find relevant products, services, and technologies.

Job Postings

Discover job opportunities that match your skillset.

Case Studies

Learn from the experience of others in the industry.

Event Calendar

Find upcoming conferences, training sessions, online events, and more.

Industry News

Stay up-to-date with the latest inspection and asset integrity management news.

Blog

Read short articles and insights authored by industry experts.

Acronyms

Commonly used asset integrity management and inspection acronyms.

Asset Intelligence Reports

Download brief primers on various asset integrity management topics.

Videos

Watch educational and informative videos directly related to your profession.

Expert Interviews

Inspectioneering's archive of interviews with industry subject matter experts.