Shell, BP to Shut Refineries for Repair, Cut Europe Fuel Supply
By Nidaa Bakhsh
Sept. 25 (Bloomberg) — Royal Dutch Shell Plc, BP Plc and Total SA are leading oil companies that will shut at least 6 percent of Europe’s refining for repairs next month, reducing inventories already diminished by U.S. demand after Hurricane Ike.
The outages from Rotterdam to Italy will idle at least 952,000 barrels of crude oil distillation a day in October, double the September figure, according to data compiled by Bloomberg. The total includes plants owned by Shell and BP in the Netherlands, representing a combined 400,000 barrels a day.
Refinery profits in western Europe fell to their lowest level since at least 2004 this year as record prices cut fuel demand. Gasoline inventories fell 18 percent to 612,000 metric tons in the Amsterdam-Rotterdam-Antwerp region last week, according to Dutch consultant PJK International BV, because of rising exports to the U.S. after Hurricane Ike shut Gulf Coast refineries.
“Over the last five years, planned crude distillation unit outages tended to average 600,000 to 800,000 barrels a day at this time of year,” Harry Tchilinguirian, senior oil analyst at BNP Paribas SA, said in a telephone interview from London. In October 2007, refinery outages peaked at 1.2 million barrels a day.
Full shutdowns will occur during the next two months at StatoilHydro ASA’s complex in Mongstad, Norway; Galp Energia SGPS SA’s Sines refinery in Portugal; Exxon Mobil Corp.’s Trecate facility in Italy and Tamoil SA’s plants in Cremona, Italy and Hamburg.
European refining margins, or the profit made from turning a barrel of crude into fuels, recovered to $4.13 a barrel last month from $1.39 a barrel in July after hurricanes Gustav and Ike.
Partial Outages
Aside from crude-processing units, shutdowns affecting other parts of refineries during this month and next, such as fluid catalytic crackers, will further reduce fuel production, with maintenance at Chevron Corp.’s Pembroke refinery in Wales and Neste Oil Oyj’s Porvoo plant in Finland.
Shell was forced to shut a gasoline-making unit last night at Pernis, Europe’s largest oil refinery, after a fault occurred, spokesman Wim van de Wiel said in a telephone interview today from The Hague. The refinery is located in the Netherlands.
Other plants in the Mediterranean region that have scheduled partial shutdowns include Total’s French refinery in La Mede, Eni SpA’s Gela plant in Italy and Repsol YPF SA’s Spanish facilities in Bilbao and La Coruna.
Spain’s Compania Espanola de Petroleos SA said yesterday it will start maintenance on a gasoline-making unit at its Gibraltar refinery next month.
Increased plant maintenance earlier this year coupled with rising crude oil costs caused a surge in fuel prices that led to European-wide protests by fishermen and truckers. New York crude oil futures rose to a record $147.27 a barrel on July 11 and were trading near $104 today. U.S. pump prices for gasoline rose to a record $4.114 a gallon in mid July, motoring group AAA said.
Wholeseale gasoline prices in the Amsterdam-Rotterdam-Antwerp region rose to a record $1,192 a ton July 11, according to data compiled by Bloomberg. The price has since dropped 24 percent. Diesel also peaked in July, at $1,346 a ton, before falling back.
The following table shows the owner, name, location, total processing capacity in barrels a day, shutdown dates and reason for halt. The information has been provided by refinery operators.
Neste Oil Oyj Aug. 15 - Oct. 2 Fourth diesel Porvoo, Finland line closes for 196,000 repairs. Tamoil SA Sept. Full shutdown. Hamburg, Germany 105,000 Tamoil SA Sept. Full shutdown Cremona, Italy for two weeks. 95,000 Eni SpA Sept. CDU, coker runs Gela, Italy cut by 80 100,000 percent. StatoilHydro ASA Sept. 1 - Oct. 15 Crude unit Mongstad, Norway shuts for 2 189,000 weeks. Chevron Corp. Sept. 15 - Oct. 31 FCC shuts. Pembroke, Wales 220,000 Repsol YPF SA Sept. 15 - Oct. 15 FCC shuts. La Coruna, Spain 120,000 Galp Energia SGPS SA Sept. 16 - Oct. 26 Full shutdown. Sines, Portugal 202,000 Royal Dutch Shell Plc End Sept. - Mid. Nov. CDU, capacity Pernis, Netherlands 200,000 b/d, 416,000 shuts. Sept. 24 FCC shuts on fault. Exxon Mobil Corp. Oct. Full shutdown. Trecate, Italy 230,000 BP Plc Early Oct. - Mid. Nov. CDU, capacity Rotterdam, Netherlands 200,000 b/d, 400,000 shuts. Royal Dutch Shell Plc Oct. 2 - Nov. 2 One of two Stanlow, U.K. crude units 240,000 shuts. Total SA Oct. 6 - Dec. 6 FCC, La Mede, France alkylation, 158,000 visbreaker shuts. Repsol YPF SA Oct. 10 - Oct. 30 Visbreaker Bilbao, Spain shuts. 220,000 Hellenic Petroleum SA Oct. 15 - Nov. 7 Partial Elefsis, Greece shutdown. 100,000 Cepsa Oct. 25 - Dec. 3 FCC shuts. Gibraltar 223,000 Source: Refinery operators, industry officials.
To contact the reporter on this story: Nidaa Bakhsh in London at[email protected]
Last Updated: September 25, 2008 05:12 EDT
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