Storm Disrupts U.S. Gulf Coast Energy Operations from Refineries to Terminals

By Erwin Seba | September 20, 2019

HOUSTON — Energy infrastructure on the U.S. Gulf Coast was hit hard by Tropical Storm Imelda on Thursday, as flooding forced a major refinery to cut production and a key oil pipeline, terminals and a ship channel in Texas were shut, according to sources familiar with operations.

Torrential rain has inundated the Gulf Coast from Houston to western Louisiana for a second straight day. The National Hurricane Center forecast the storm could drop up to 40 inches (102 cm) of rain along the southeastern coast of Texas through Thursday night.

Ship pilots stopped boarding vessels on the Beaumont, Texas, Ship Channel because of heavy weather on the waterway connecting Beaumont with the Gulf of Mexico, the U.S. Coast Guard said.

Exxon Mobil Corp shut some units at its 369,024 barrel-per-day (bpd) Beaumont refinery but was able to maintain production at minimal levels on others, said three sources familiar with plant operations.

Spokesman Jeremy Eikenberry said Exxon’s Beaumont refinery “continues to operate” but declined to discuss production levels.

He also said the chemical plant adjoining the refinery was safely shut on Thursday morning.

Sources had told Reuters on Thursday morning that the Beaumont refinery had shut production. After Exxon’s Thursday afternoon statement about the refinery’s status, three sources said the refinery had shut some units but had been able maintain others in operation at minimal levels.

Several other refineries in southeast Texas cut back production as well.

Valero Energy Corp reduced production at its 335,000 bpd Port Arthur refinery because flooded roadways made it impossible to haul sulfur away from the plant.

The gasoline-producing fluidic catalytic cracker was running at 60% of its 110,000 bpd capacity because of a compressor outage at Lyondell Basell Industries 263,776 bpd Houston refinery.

A Lyondell spokeswoman declined to discuss operations at the refinery.

Total SA cut coker production in half at its 225,500 bpd Port Arthur refinery because heavy lightning in the area made it unsafe to operate a crane used to collect petroleum coke produced by the coker.

Motiva Enterprises’ 607,000 bpd Port Arthur plant remained in production, but the largest U.S. refinery has been operating at half capacity since early September because of a planned multi-unit overhaul, sources familiar with operations said.

TC Energy Corp’s 750,000-bpd Marketlink oil pipeline from Cushing, Oklahoma, to Nederland, Texas, was also shut as flooding disrupted operations at Gulf terminals, traders familiar with the matter said.

Energy Transfer LP’s Nederland terminal, located between Beaumont and Port Arthur, was shut due to heavy rains, five market sources said.

Phillips 66 said it shut its operations at its Beaumont terminal as a safety precaution due to the flooding.

Officials at Cheniere Energy Inc’s Sabine Pass liquified natural gas (LNG) terminal in Louisiana and Sempra Energy’s Cameron LNG terminal in Louisiana said there had been no impact on operations from Imelda.

Officials at Freeport LNG said there was no significant impact from the storm on its Freeport, Texas, facility.

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