Massive fire strikes California oil refinery

Chevron refinery fire contained but not extinguished, threatens prolonged outage that may increase prices of US gasoline.

By REUTERS
August 7, 2012 10:50
2 minute read.
Firefighters douse flames at Chevron oil refinery

California Oil Refinery Fire 370. (photo credit: reuters/James Edelson)

 
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RICHMOND/HOUSTON- A massive fire struck at the core of Chevron Corp's large Richmond, California, refinery on Monday, spewing flames and a column of smoke into the air, threatening a prolonged outage that may increase prices of the costliest US gasoline.

The fire was contained, but not extinguished, according to the company. The fire has blazed more than three hours after it erupted at the refinery in a densely populated industrial suburb of San Francisco. Smoke could be seen billowing over the Bay Area and four train stations were shut.

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Nearby residents were ordered indoors after the fire hit the sole crude unit at the 245,000 barrel per day (bpd) plant, which accounts for one-eighth of California state's refining capacity.

It was not immediately clear when the fire would be put out and the extent of damage to the plant was not known.


Crude distillation units (CDUs) break down oil into feedstock for other units in a refinery. It can take months to repair a CDU at a large plant, during which operations are typically severely limited.

Any lengthy disruption in production could affect the supply of fuel in the West Coast, particularly gasoline, due to the difficulty in meeting California's super-clean specifications. The region also has few immediate alternative supply sources.

"Chevron will have a hard time finding replacement barrels in an already short market," said Bob van der Valk, a petroleum industry analyst in Terry, Montana.

Residents had been concerned about refinery's environmental impact



Residents of Richmond were advised to "shelter in place", an order often given during refinery accidents to shield against possible exposure to toxic chemicals or smoke. Sulfuric acid and nitrogen dioxide were released during the incident, according to a filing with the California Emergency Management Agency.

The refinery, the third largest in California and among the oldest in the country, is key to the economy of Richmond, a declining industrial city. But it has stirred controversy among local residents concerned about the environmental impacts and local politicians often seeking more tax revenues.

"I looked out the window and saw 40 foot flames and black smoke," Marc Mowrey, a Point Richmond resident who lives about a mile from the plant, said in a telephone interview.

Chevron said in a statement that there had been only one minor injury at the refinery, which at its peak 10 years ago employed over 1,300 people on a site of over 2,900 acres.

Last week, the refinery reported vapor leaks and a compressor failure to California pollution regulators, according to notices. The notices did not say which units were involved.

We are "very disappointed that this happened, and apologize that we are inconveniencing our neighbors," Chevron spokesman Walt Gill told local television.

A Reuters reporter who lives nearby said he heard some loud bangs and a siren as the fire erupted, but a Chevron spokesman denied reports of an explosion.

It is common to shut down the entire plant in the event of a major blaze. A Feb. 17 fire at the CDU of BP Plc's 225,000 bpd Cherry Point, Washington, refinery led to a three-month shutdown and sent the regional price premium to more than $1 a gallon in some places.

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