Far From the Texas Coast, Hurricane Harvey Hits Oil Refiners

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Exxon, Phillips 66, Marathon among refiners delaying work

Lack of manpower, higher margins among reasons for postponing

Three weeks after Hurricane Harvey ravaged the massive fuel-making industry along the Texas coast, the region’s recovery from storm damage is starting to disrupt plans for crucial maintenance at refineries thousands of miles away from the flood zones.

Harvey knocked out almost one-quarter of U.S. refining capacity in late August, sending gasoline and diesel prices soaring. The storm hit a few weeks before most of the nation’s fuel makers were set to begin seasonal shutdowns. Demand usually slows at this time of year, so it’s a good time to make repairs and install new equipment at plants that typically run all day every day.

But at least 13 refineries from Louisiana to Montana with a combined 3.27 million barrels a day have delayed maintenance for weeks or months, according to company statements and people familiar with the situation. Some are churning out more fuel to take advantage of strong margins, while others simply don’t have the personnel because workers were dispatched to help repair and restart storm-hit facilities along the Gulf of Mexico.

“Any plant that has the option of pushing back the work is probably going to do so,” Robert Campbell, head of oil-products analysis at Energy Aspects Ltd. in New York, said by telephone. "You have really good margins. There would be concerns about some of the skilled trades, some of the services required."


More: https://www.bloomberg.com/news/articles/2017-09-18/far-from-the-texas-coast-hurricane-harvey-hits-oil-refiners-j7qrx1p8



Floodwater surrounds oil refinery storage tanks in Texas City, Texas on Aug. 30. Photographer: Luke Sharrett/Bloomberg