Tag Archives: refineries

Oil prices slip as Hurricane Laura makes Gulf Coast landfall

By Ahmad Ghaddar

LONDON (Reuters) – Oil prices fell on Thursday as a massive hurricane in the Gulf of Mexico made landfall in the heart of the U.S. oil industry, forcing oil rigs and refineries to shut down.

Brent crude futures for October, which expire on Friday, fell 50 cents, or 1.1%, to $45.14 a barrel by 1359 GMT. The more active November Brent contract was down 55 cents, or 1.2%, at $45.61 per barrel.

U.S. West Texas Intermediate crude futures fell 39 cents or 0.9% to $43 a barrel.

Hurricane Laura made landfall early on Thursday in southwestern Louisiana as a category 4 storm, one of the most powerful to hit the state, with forecasters warning it could push a wall of water 40 miles inland from the sea.

Oil producers on Tuesday had shut 1.56 million barrels per day (bpd) of crude output, or 84% of the Gulf of Mexico’s production, evacuating 310 offshore facilities.

At the same time, refiners that convert nearly 2.33 million bpd of crude oil into fuel, and account for about 12% of U.S. processing, halted operations.

“Perhaps traders are waiting to see what the damage is but the limited impact so far may also just be a reflection of the current oil market dynamics. Temporary disruptions are easily covered,” OANDA analyst Craig Erlam said.

Oil prices also shrugged off U.S. crude inventory declines and signs that gasoline demand in the world’s biggest oil consumer were improving.

Crude oil stockpiles fell last week as exports soared the most in 18 months and refineries boosted production to the highest rate since March, Energy Information Administration data showed on Wednesday. Gasoline stocks also fell.

“It appears that the gasoline inventory reduction was due first and foremost to increased demand – gasoline demand rose to a six-month high of around 9.2 million bpd,” Commerzbank said.

(Additional reporting by Sonali Paul and Koustav Samanta; editing by Jason Neely)

These Houston residents dream of moving to where the air is clear

By Loren Elliott

HOUSTON (Reuters) – On the east side of Houston, the white plumes of the Texas oil and chemical refineries are a constant backdrop for residents of the Manchester neighborhood.

Late at night or early in the morning when plants burn off excess gases, the flames light up the whole sky in the neighborhood.

Some residents say the air has a chemical-based smell that they find hard to describe but disappears once they drive a few miles away from the homes that stretch along the Houston Ship Channel, a waterway connecting the plants to the ocean. They claim that the pollution is taking a toll on their health, although the scientific evidence does not prove that.

“I want to get out of here and go to the country and find some cleaner air,” said Eugene Barragan, a 56-year-old electrician who has lived most of his life by the refineries. “It would be better for me and the kids.”

Doctors have found four lumps in his lungs and now more growths, according to the chest X-rays and medical records he showed Reuters. The first ones were not cancerous. Barragan says he has not been able to afford imaging of the new growths. He hopes they are benign so he can watch his children grow up.

“When I work hard, I start coughing and coughing and can’t stop,” he said. “I know a lot of people who have problems like that.”

POLLUTION REDUCED

Lillian Riojas, Valero Energy Corp’s chief spokeswoman, said the company has worked to reduce pollution at its refinery since purchasing it in 1997.

In the 22 years since Valero took over the refinery, ambient benzene levels have dropped 63% to 0.34 parts per billion, according to data from 1997 to 2019 from Texas Commission on Environmental Quality.

“There’s a narrative that air quality is getting worse, but that’s not what the emission data is showing,” Riojas said.

The Texas Commission on Environmental Quality, which enforces federal and state environmental laws, gives Valero’s refinery the top compliance level possible, said Andrew Keese, a spokesman for the agency. The other nearby refineries and chemical plants earned a compliance rating of satisfactory.

Of the other plants bordering Manchester, Goodyear Tire and Rubber Co has the second highest-rating for compliance with environmental regulations, Keese said.

Goodyear “implemented several changes that resulted in lower emissions from our facility,” said Connie Deibel, a company spokeswoman.

LyondellBasell Industries, TPC Group [TPCL.UL] and Flint Hills Resources, which operate facilities near Manchester, did not reply to requests for comment about pollution in the area.

NO MONEY TO MOVE

A 2007 study, the most recent available, of nearly 1,000 childhood cancer cases by the University of Texas found children living within 2 miles (3 km) of the Houston Ship Channel had a 56% higher risk of contracting acute lymphocytic leukemia than children living within 10 miles (16 km) of the Ship Channel. Researchers’ analysis suggests an association between childhood leukemia and air pollution. However the study, funded by Houston’s health department and the Centers for Disease Control and Prevention, could not prove the pollutants caused the illnesses.

For years, Dennys Nieto wanted to leave the neighborhood but was only recently able to afford to move her and her family to a different part of Texas.

“I suffer from asthma and pain in my lungs. It feels like I’m being hit in the lungs,” Nieto said of her old neighborhood. “Headaches, inflammation and pain in my throat. And also I have erratic blood pressure and heartbeat.”

She checks her blood pressure and listens to her heart beat regularly.

“In the air I feel it’s this we’re all breathing. This is why I want to leave from here,” Nieto said of the Manchester area. “I want to go somewhere that is far from the refineries so that I can repair my life, repair my health and live better.”

 

(Reporting by Loren Elliott; additional reporting by Erwin Seba; Editing by Lisa Shumaker)

US Coast Guard, EPA cleaning up a dozen Texas chemical spills after Harvey

Vehicles sit amid leaked fuel mixed in with flood waters caused by Tropical Storm Harvey in the parking lot of Motiva Enterprises LLC in Port Arthur, Texas, U.S. August 31, 2017.

By Emily Flitter

HOUSTON (Reuters) – The U.S. Coast Guard and the Environmental Protection Agency are working with Texas state regulators to clean up oil and chemicals spilled from a dozen industrial facilities after flooding from Hurricane Harvey, authorities said.

The spills came from oil refineries, fuel terminals and other businesses, but EPA spokeswoman Terri White said it was not possible to provide an estimate for the amounts spilled.

“Initial reports were based on observation,” White said. “Some spills were already being cleaned up by the time EPA or other officials arrived to assess them and others had already migrated offsite.”

Refineries owned by Valero Energy Corp in Houston, Motiva Inc in Port Arthur, and Exxon Mobile Corp in Baytown, were among the facilities that had reported spills, according to White. Representatives for those companies did not immediately respond to requests for comment.

Officials also reported spills at Kinder Morgan Inc’s Pasadena fuel storage terminal and at an oil terminal in Texas City owned by NuStar Energy LP.

Kinder Morgan spokeswoman Lexey Long said on Monday the company reported a spill of 500 barrels of gasoline on Aug. 27. Workers covered the spill with a foam blanket and set up a barrier to keep the public away.

“The spill has been fully remediated,” she said.

NuStar representatives had no immediate comment.

Two wastewater treatment plants – Integrity Golden Triangle Marine Services of Port Arthur and San Jacinto River and Rail in Beaumont – also appeared on the list of spill response locations that EPA provided to Reuters.

San Jacinto River and Rail said it spilled a “foamy emulsion” when floodwaters overtopped the berms around its facility.

“Some is on our property and some is on adjacent property which has already been cleaned up,” said spokesman Dennis Winkler. “We do not expect a long-term environmental impact. We do not expect there will be any air impact or health impacts.”

Representatives from Integrity Golden Triangle did not immediately respond to requests for comment.

The liquid spills come in addition to more than a million pounds of toxic emissions above legal limits that spewed from industrial facilities following Harvey, according to reports from companies filed with the Texas Commission for Environmental Quality.

The EPA and other authorities had warned people affected by the flood that waters could contain bacteria and toxic chemicals, but have said little yet about the specific origins or quantities of substances.

Residents in Baytown, where houses sit along the Houston Ship Channel next to several major refineries and chemical plants, said they were concerned about the impact of the spills and releases on health.

“I’m against the sword and the wall, what can I do?” said Carlos Caban, one of the residents, whose son had taken pictures of contaminated-looking floodwaters in nearby refinery site.

Several residents reported seeing a metallic sheen on water flowing near the plants during the heaviest flooding, posting videos to YouTube.

 

(Reporting By Emily Flitter; editing by Richard Valdmanis and Jonathan Oatis)

 

U.S. gasoline prices tumble as Harvey subsides

A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. REUTERS/Lucy Nicholson/File Photo

By Ron Bousso

LONDON (Reuters) – Benchmark U.S. gasoline prices slumped on Monday to pre-Hurricane Harvey levels as oil refineries and pipelines in the U.S. Gulf Coast slowly resumed activity, easing supply concerns.

Brent crude oil futures were flat at $52.75 by 1340 GMT, paring earlier losses after a powerful North Korean nuclear test triggered a shift away from crude markets to assets perceived to be safer, such as gold.

U.S. West Texas Intermediate crude futures, however, were up 34 cents at $47.63 barrel as U.S. demand, hit by reduced refinery activity since Harvey made landfall on Aug. 25, recovered.

NYMEX gasoline futures were down 3.2 percent at $1.6916 a gallon, levels last seen on Aug. 25, the day Harvey struck, crippling production and causing widespread flooding.

Still, damage to the oil infrastructure in the Gulf Coast hub by Harvey appeared less extensive than some had feared.

Harvey has now been downgraded to a tropical storm.

A number of major refineries, which convert crude oil into refined products such as gasoline and jet fuel, as well as distribution pipelines, were gradually resuming operations on Monday.

Valero Energy’s 225,000 barrels per day (bpd) Texas City refinery was the only plant reported to be running at normal rates so far.

At the same time, about 5.5 percent of the U.S. Gulf of Mexico’s oil production, or 96,000 barrels of daily output, remained shut on Sunday, down from a peak of more than 400,000 bpd last week.

“The disruptions from Hurricane Harvey in the U.S. Gulf Coast are gradually clearing. In the broader scheme of things, it appears that so far the energy industry was spared major damages to assets and infrastructure,” analysts at Vienna-based JBC Energy said in a note.

“However, some Houston area refineries will likely remain offline for some time longer.”

Traders booked dozens of gasoline tankers over the past week from Asia and Europe to the United States and Latin America in order to plug supply shortages in the wake of the shutdowns.

European gasoline refining margins dropped by nearly a fifth on Monday.

And while the U.S. government tapped its strategic oil reserves for the first time in five years last week, the head of the International Energy Agency (IEA) said the global energy watchdog still sees no need for a coordinated international release of oil stocks after Harvey.

Texas Governor Greg Abbott estimated damage at $150 billion to $180 billion, calling it more costly than Hurricanes Katrina or Sandy, which hit New Orleans in 2005 and New York in 2012 respectively.

Traders were nervously watching developments in North Korea, where the military conducted its sixth and most powerful nuclear test over the weekend. Pyongyang said it had tested an advanced hydrogen bomb for a long-range missile, prompting the threat of a “massive” military response from the United States if it or its allies were threatened.

That put downward pressure on crude as traders moved money out of oil – seen as high-risk markets – into gold futures traditionally viewed as a safe haven for investors. Spot gold prices rose for a third day, gaining 0.9 percent on Monday.

Overall trading activity in the oil futures market was expected to be low on Monday due to the U.S. Labor Day public holiday.

 

(Additional reporting by Henning Gloystein in Singapore; Editing by Louise Heavens)