Motorists in Colorado should get ready to pay more at the pump after Suncor Energy announced this week it would shut down its Commerce City oil refinery for as long as three months due to equipment The reasons for those closures are due primarily to governments. At Separo weve spent many years earning a global reputation for the excellence and flexibility of our tank cleaning and recovery services. There's just fewer refiners in the U.S. today than a couple of years ago. The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. The refinery could be converted into a processor of pyrolysis oils, which can be used to make renewable diesel, but that study will take years. Monday, June 20, 2022 Industry Why are refineries closing amid oil price windfall? The same thing is happening across Europe, With Neste closing the Naantali refinery which has previously refined 55,000 barrels per day (bpd), and Gunvor closing the loss-making Antwerp refinery previously dealing with 115,000 bpd with no plans to reopen it if the market picks up. Although the short term issues may well have been driven by the temporary impact of the pandemic, a study published as long ago as 2017 predicted exactly how things were going to unravel across the oil refining sector, with the key driver of change being a global switch away from fossil fuels prompted by concerns about climate change. A key Texas petroleum refinery that produces more than 200,000 barrels of fuel per day is facing a premature shutdown that could increase pressure on domestic fuel supplies. The Golden State is bearing the brunt of these shutdowns, which are triggering a steep uptick in the cost of a gallon of regular unleaded fuel. The Houston, Texas, facility which is operated by LyondellBasell Industries, spans 700 acres and was built in 1918 is scheduled to permanently close by the end of 2023, but could shut down earlier if a major equipment failure spreads to major units, two people familiar with the issues told Reuters. Citgo Petroleum Corp. is shutting down a section of a sulfur recovery unit known as a B-train for four days due to the loss of third-party oxygen supply "resulting from increased medical field. De Haan added that one wild card could be Hurricane Ian, which, as of Monday, was approaching the Gulf Coast. That is pretty much always the inevitable outcome of such policies. Change), You are commenting using your Twitter account. Global refining, which is vital for producing fuels like gasoline and diesel, decreased by 1.4 million barrels a day between 2019 and the first quarter of 2022, according to the International Energy Agency. CAPACITY: 161,000 bpd (Martinez); 27,000 bpd (Gallup). HOUSTON, April 21, 2022 /PRNewswire/ -- LyondellBasell (NYSE: LYB) . They said the numbers just didn't work, and closed up shop. Most of the refinery closures occurred in western countries, the data showed. Meanwhile Chevron reported its highest quarterly profit in nearly a decade, while Shell posted its highest earnings ever. Prior to the pandemic, experts were already predicting a major downturn in the oil refinery sector across Europe, with companies having to rationalise their presence across the continent, particularly in light of the ageing nature of many of the refineries themselves. 74-89% of retail investor accounts lose money. "The Houston Refinery is currently. According to our annual Refinery Capacity Report, 2021 was the second consecutive year of decreasing refinery capacity. Meanwhile, the operator made modifications in 2014 and 2015 to process 3,500 barrels of vegetable oils and beef tallow per day. At the same time over the last 4+ decades, some companies have decided to shut down aging refineries as the costs of environmental regulatory compliance and mandates to blend constantly. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. Calcasieu Refining shut its Lake Charles plant in early August of 2020, according to the Louisiana Department on Environmental Quality, citing demand loss during the pandemic. Change), You are commenting using your Facebook account. When an existing oil refinery becomes defunct and needs to be repurposed, one of the over-riding priorities is to deal with the remaining waste and pollution left by what have often been decades spent refining crude oil. Get access to our searchable data center of TOP LISTS. The U.S. had five fewer. They're operating above 90% capacity according to the Energy Information Administration, and expected to run at 95% for the rest of the summer. It would take months to bring the refineries back online, and it would be costly for the refiners. Get access to more than a decade of story archives. 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Shell announced in November 2020 it would be shuttering the refinery after attempts to sell the plant between July and October were unsuccessful. With gas prices surging past $5.00 a gallon, many Americans are wondering what is the problem. George Frey/Getty Images Daily Caller News Foundation June 7, 2022. 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June 17 (Reuters) - Since the onset of the global pandemic, the United States has lost nearly 1 million barrels per day of oil refining capacity, with more set to be shuttered in the next few years. Shell planned to try to divest the refinery as it considers closing facilities it cannot sell, the company told investors. Lyondell originally planned to sell the plant back in 2017 but pivoted and continued operations. According to a report from Reuters, published in June of this year, the refining capacity across the US fell by 4.5% during 2020, the largest drop since the recession of 2012. This is a family newspaper, please use a kind and respectful tone. Some refineries shuttered during the pandemic-induced recession in 2020, when demand for gasoline took a nosedive. Cinquegrana from Oil Price Information Service says that from the refiners' perspective, it doesn't make financial sense to invest in additional oil refining given the broader transition. No portions of this website may be reproduced, retransmitted, copied, or republished without expressed written consent from Shore News Media & Marketing, LLC. By Alex Kimani - Dec 29, 2022, 11:00 AM CST. Just last Friday, in its response to Bidens intemperate attack during a speech at the Port of Los Angeles, ExxonMobil noted that it is in the process of expanding its own refining capacity in the U.S. by 250,000 bopd. The materials provided on this Web site are for informational and educational purposes only and are not intended to provide tax, legal, or investment advice. (LogOut/ The Paramount refinery began operating in the 1930s. Home; . Reports also came in on Monday. The refinery processes 268,000 barrels per day (bpd) of oil and produces 92,600 . When you have a power issue, that can sometimes be really difficult to operate around, he said. Lyondell could permanently close the refinery ahead of the December 2023 deadline if one of several major production units is shut and cannot quickly return to production. U.S. gasoline inventories started their most recent build streak during the last week of 2021, gaining 27.4 million barrels since December 24, according to EIA data. Patrick De Haan, Gas Buddys head of petroleum analysis, said in a statement that prices in the impacted areas could go up another 25 to 75 cents before the issues are resolved. Right now, all bets are off.. This is so, so frustrating, Hogan said. Limetree Bay Energy shut its St. Croix refinery due to financial problems in May 2021 after only operating for a few months, due to operational setbacks. Over 2021, several refinery complexes saw workforce lay-offs - some as high as 60%. Click Manage settings for more information and to manage your choices. hide caption. France's TotalEnergies reported higher refinery throughput in Q3 amid improved margins. On Thursday, Lyondellbasell Industries announced its plans to shut down its Houston Oil refinery by 2023 permanently. You can change your choices at any time by visiting your privacy controls. Some refineries shuttered during the pandemic-induced recession in 2020, when demand for gasoline took a nosedive. Staples says that if the federal land ban continues, Texas is set to lose 120,000 jobs and $65 million in revenue by 2022. Louisiana's 17 oil refineries account for nearly one-fifth of the nation's refining capacity, with the ability to process about 3.4 million barrels of crude oil per day, according to the . The average retail price of gasoline increased 51% in Colorado and 27% in the Rocky Mountain region between the end of December and Feb. 20, according to a U.S. Energy Information Administration . Bidens letter does appear to recognize that the U.S. refining industry is already currently operating at near-full capacity as the industry has worked overtime to meet consumer demand for its products. Could Gravity Batteries Win The Energy Storage War? Why Biden's refinery push may run into trouble. Refineries transform that oil into products and sell those. Not all of those refineries have come back online. I recently noted that LyondellBasell "I think the refining executives say, well, looks like the writing's on the wall," Cinquegrana says. The question for anyone working in the industry is whether the sector will spring back as lockdowns lift across the world, or whether the impact of the pandemic was merely an accelerating factor within a process which was already underway. . There are examples of this approach from across Europe: Total is planning to convert the Grandpuits refinery in France which has been temporarily shut down since February this year into a biofuels and plastics recycling complex. The cost of driving had been dropping for 14 weeks nationwide before the recent refinery issues developed. Four concurrent production shutdowns in California is unfortunate timing, but its impossible for refineries to schedule maintenance around each other, said Severin Borenstein, a UC Berkeley energy economist. Denton Cinquegrana, chief oil analyst with the Maryland-based Oil Price Information Service, wouldnt rule that out, but he cautioned that fuel prices tend to be unpredictable. There was already some contraction happening in the industry as a result of projected declines in U.S. gasoline demand into the future and companies just deciding that the assets were better used as other projects or shut down completely, he continued. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. Dollar Tree Inc forecast annual profit well below estimates on Wednesday, hurt by elevated freight and investment costs and as consumers rein back spending on discretionary items. The plant is set to close by December 31, 2023. Refineries Shutting Down South Africa is refining less crude oil and only two refineries remain operational as it has become increasingly expensive to operate refineries and more. In a recent interview with Fox Business, American Petroleum Institute President Mike Sommers stated that 11 US gas refineries closed over the past two years. In a recent interview with Fox Business, American Petroleum Institute President Mike Sommers stated that 11 US gas refineries closed over the past two years. 2022 Welcome: Official Visitors Guide to Greater Baton Rouge. About three weeks ago, gas at the Safeway on Mendocino Avenue was $4.94 per gallon. 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