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Citgo Illinois Refinery Shut Down After Hearth, Cause Of Blaze Unknown

LEMONT, Unwell. Oct 24 (Reuters) – Citgo Petroleum Corp effectively shut down its refinery close to Chicago after a fireplace at its foremost crude unit, saying it did not know when operations may resume.

Benchmark gasoline futures spiked 1.5 % after news of the Wednesday night time fire on the 174,500 barrel per day (bpd) refinery in Lemont, Illinois. Citgo said it shut down the crude distillation unit, the workhorse of any refinery that processes crude oil into feedstock for different units within the plant.

“At this time we do not need a schedule on when the crude unit will again be operational,” Citgo stated in an announcement. “The refinery operations have been significantly reduced, but we do have some downstream items nonetheless in operation.”

A supply accustomed to the refinery’s operations earlier advised Reuters that the plant was “pretty much shut down,” and without the crude unit Citgo is prone to quickly run out of secondary feedstock wanted to run the secondary models. Industry group Genscape said two different major units have been already shut.

The supply mentioned the extent of the harm to the crude unit was not identified. The unit was last shut for maintenance in spring 2012, in accordance with IIR Energy. The refinery runs largely heavy Canadian crude, government information show.

Local emergency fireplace officials mentioned the refinery’s inside fire employees of over a dozen people dealt with a lot of the exercise and managed to deliver the fire beneath control inside three hours. One other 50 to 60 outdoors firefighters assisted.

“The fire wasn’t as huge as it could have been,” Lemont Hearth Chief George Rimbo said. “We had been ready to control it very quickly.”

They confirmed that there have been no accidents or rescues. They didn’t know the reason for the hearth or the extent of the damage.

Steam was seen coming from the stacks of some items at the refinery on Thursday, consistent with continued operation of the downstream units. There crude oil consists of was no smell of burning and no seen emergency autos. Vending trucks came and went.

Local television showed nighttime photos of dark smoke rising from the refinery, 30 miles southwest of Chicago, but crude oil consists of no flames. The native ABC Tv station quoted an unnamed refinery employee as saying a crew had been working on a valve when a crude oil leak caught hearth.

“I know there was so much of work being finished on the refinery, one thing sparked, which caused the fireplace,” Lemont Mayor Brian Reaves advised the local NBC Television station.

Genscape later reported the 160,000 bpd CDU, the 71,000 bpd vacuum distillation unit (VDU) and a 28,000-bpd catalytic reformer had all been shut simply after eight p.m. EDT (midnight GMT).

U.S. benchmark gasoline futures costs, which had closed close to their lowest since 2011 on Wednesday, jumped on Thursday, rising 1.5 % to $2.5896 a gallon on the new York Mercantile Trade (NYMEX).

Chicago CBOB gasoline differentials over the NYMEX contract additionally jumped 10 cents a gallon on news of the hearth. The refinery has the capability to provide four million gallons per day (95,000 bpd) of gasoline, according to its web site.

Items which can be downstream of the principle crude distillation unit (CDU) need to use feedstock that’s on hand in the refinery or in storage tanks. Without the CDU, the saved inventories will run out and the refinery will both cease operations altogether or can choose to purchase feedstock from the market.

A 2012 crude unit fire at Chevron Corp’s Richmond, California, refinery shut the CDU for a number of months and lower gasoline production by at the very least 50 %.

Regardless that the refinery is just not the largest in the area, wholesale Chicago gasoline costs are spiking, mentioned Patrick DeHaan, senior petroleum analyst at GasBuddy, a web site that displays gasoline costs across the country.

“It would not shock me if Chicago rallied for a couple of days. We want to listen to from Citgo the extent of harm – that will affect how lengthy costs will rally,” DeHaan said.

But, he mentioned, drivers may not really feel a significant impact in the close to term because Chicago gasoline costs have been tumbling in the past week, with inventories on the rise and no serious refinery points until now.

Chicago CBOB gasoline differentials had been indicated 17.00/12.00 cents underneath November RBOB gasoline futures, while ultra-low sulfur diesel crude oil consists of rose 4.50 cents a gallon to 5.00/3.00 cents under November heating oil futures, traders said.

Within the neighboring Group Three market, covering some Midwestern states, gasoline differentials rose four.50 cents to 20.50/19.50 cents under the RBOB futures and ULSD rose 2.50 cents to six.50/5.50 cents underneath heating oil futures.

Gulf Coast gasoline differentials rose by over 2 cents a gallon in anticipation of rising demand from the Chicago space.

The shutdown might also contribute to a hunch in cash crude markets attributable to weak demand from refiners that shut for routine upkeep within the autumn. One money crude trader mentioned it was too quickly to inform what affect the fire will have. The refinery runs on a food plan of nearly solely Canadian crude.