Phillips 66 shuts in Alliance refinery ahead of Tropical Storm Barry: company

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Phillips 66 shuts in Alliance refinery ahead of Tropical Storm Barry: company

Houston —
Phillips 66 is preparing to shut its 253,600 b/d Alliance refinery in Belle Chasse, the company said Thursday, the first plant to shut ahead of the storm bearing down on the Louisiana coast.

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US Gulf Coast gasoline prices were strengthening in reaction to the storm. Benchmark USGC gasoline was trading at August NYMEX RBOB minus 11.25 cents/gal Thursday morning, up from minus 13.25 cents/gal Wednesday.

“Based on Invest 92L’s current projected path and a mandatory evacuation ordered by Plaquemines Parish, the Phillips 66 Alliance Refinery is preparing a safe and orderly shutdown of the facility,” said Phillips 66 spokesman Dennis Nuss.

“Non-essential personnel have been released from work. We expect a full shutdown of the refinery to be completed by early Friday morning.” he said.

The National Hurricane Center upgraded the storm to Tropical Storm Barry on Thursday morning. A tropical storm warning and hurricane watch are in effect for much of the Louisiana coast, and the NHC said additional watches and warnings could follow later Thursday.

Other USGC refiners said they were keeping an eye on the storm.

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Chevron said it was following its storm procedure plans at its two USGC refineries – the 330,000 b/d Pascagoula, Mississippi, plant and the 112,229 b/d Pasadena, Texas, plant newly acquired from Petrobras.

Chevron said its Fourchon and Empire terminals are still operating, but Chevron Pipe Line has “shut down, secured and evacuated” Whitecap Ship Shoal 208 platform.

Jet fuel prices on the Gulf Coast were not immune from the storm threat. Benchmark USGC jet was bid at NYMEX ULSD plus 3 cents/gal in early Thursday trading, up 75 points from Wednesday’s assessment.

A jet fuel trader said that, in light of the latest storm-path predictions, he did not expect the jet fuel market to rise as high as it did after Hurricane Harvey in 2017.

“Just a rain event,” the trader said.

At 1543 GMT, NYMEX refined products were higher, led by August RBOB, which was up 41 points at $2.0093/gal. August ULSD was up 32 points at $1.9942/gal. NYMEX August WTI was up 35 cents at $60.78/b and ICE September Brent was 4 cents stronger at $67.05/b.

GULF OPERATORS BEGIN SHUTTING OFFSHORE PRODUCTION

Offshore, Chevron said it has shut in five of its operated Gulf of Mexico platforms and have evacuated all personnel. The affected platforms are our Big Foot, Blind Faith, Genesis, Petronius and Tahiti facilities.

“While some nonessential personnel have been evacuated from our Jack St. Malo facility, production at that asset remains at normal levels,” Chevron said in a statement.

S&P Global Platts Analytics estimates Gulf of Mexico crude production could be reduced by 140,000-230,000 b/d over July.

The US Department of Interior’s Bureau of Safety and Environmental Enforcement said Wednesday that Gulf of Mexico drillers had shut 32% of oil production and 18% of natural gas output ahead of storm. Fresh data is expected to be released at 1 pm CDT.

On Wednesday, major Gulf of Mexico operators Anadarko, ExxonMobil and BP started shutting in US Gulf of Mexico production and evacuating staff from drilling and production platforms, while Shell started evacuating nonessential staff but continued with reduced production.

Shell has slowed production at its Olympus project by 1,835 b/d and at its Mars project by 700 b/d. It also cut production at Appomattox.

Anadarko is shuttering production at its Constitution, Heidelberg, Holstein and Marco Polo platforms in the central Gulf of Mexico and removing all staff from the facilities, it said Wednesday on its website.

Anadarko also removed nonessential staff from its eastern Gulf of Mexico facilities.

BP said it has started removing staff and shutting in production at BP-operated platforms “across the Gulf,” without giving further details. Sources said Thunder Horse, Atlantic, Mad Dog and Na Kika were impacted.

ExxonMobil said it evacuated nonessential personnel from three platforms in the Gulf of Mexico, including Lena, which is in decommissioning, and is prepared to transfer remaining personnel if necessary. A company spokeswoman said there was minimal impact to Exxon-Mobil operated production.

— Janet McGurty, with Josh Brown and Seth Clare in Houston, newsdesk@spglobal.com

— Edited by Derek Sands, newsdesk@spglobal.com