Baton Rouge, La. – Hurricane Rita smacked a key region for oil-refining with less force than feared Saturday, although there were some early signs of damage.
Pump prices for gasoline and diesel fuel could rise if pipelines and oil refineries are slow to resume operations, and analysts said they were paying close attention to facilities in Lake Charles, La., and Beaumont and Port Arthur, Texas.
“There will be some modest disruption of supplies of gasoline and other products,” said William Veno, an analyst at Cambridge Energy Research Associates. “But I don’t think it’s going to be as severe a situation as Hurricane Katrina.”
Power outages were reported across wide swaths of Texas and Louisiana, leaving more than a million customers without electricity, and one utility spokeswoman said it could be weeks before service is fully restored.
Valero Energy Corp. said it will take two weeks to a month to repair and restart its 255,000- barrel-per-day Port Arthur refinery, which sustained “significant damage to two cooling towers and a flare stack.”
But on a positive note, Valero said there was no serious flood damage at its Port Arthur facility and that the company received reports that the lights were on at its refineries in Houston and nearby Texas City – plants that refine almost 300,000 barrels of oil per day.
BP PLC spokesman Scott Dean said that was encouraging because “they’re right next door to us.” BP’s Texas City refinery processes 437,000 barrels daily.
Marathon Petroleum Co. said its Texas City refinery, which processes 72,000 barrels of crude oil per day, has power and sustained only minimal damage.
Based on computer modeling and initial reports, the Energy Department said it was cautiously optimistic about the nine refineries in the Houston area.
“But we really need to look at the Port Arthur region and other areas directly impacted,” a spokesman said. “It may still be two or three days before we get a sense of the actual picture.”
ConocoPhillips, Calcasieu Refining Co. and Citgo Petroleum Corp., a subsidiary of Petroleos de Venezuela S.A., have refineries in Lake Charles. In Port Arthur, refineries are owned by Valero, Total S.A. and Motiva Enterprises Inc., a joint venture between Royal Dutch Shell PLC and Saudi Refining Inc.; Exxon Mobil Corp. has a refinery in Beaumont.
Shell said in a statement that there was wind damage to power lines and a cooling water-tower at its Port Arthur refinery, but no flooding. The company said it had no restart date yet for the plant.
