Chemical Leak at Texas Refinery Prompts Brief Shelter-in-Place Order

A chemical leak from Marathon Petroleum's refinery in Galveston Bay prompted Texas officials to call for a shelter-in-place order this weekend before readings showed the air quality in the area was normal.

The release of chemicals followed a small fire at the refinery last week, which did not affect regular operations, according to unnamed sources cited by Bloomberg at the time.

"Multiple agencies have been conducting air monitoring, and all readings in the affected areas and throughout the city are normal," Texas City officials said on Facebook, as quoted by Bloomberg. "We will continue to monitor the situation closely."

This is the same refinery that earlier this year caught fire and had to be shut down temporarily, a couple of months after another fire, in another unit.

Refiners in the United States faced an uphill battle last year to respond to demand for fuels after the end of the pandemic lockdowns, as capacity shrunk while demand increased, albeit modestly.

The recent fires at the Marathon Petroleum facility first took out its 140,000-bpd gasoline production unit and then a reformer with a capacity of 75,000 barrels daily. The refinery's total capacity is close to 600,000 barrels daily.

At the moment, Marathon Petroleum is expanding that capacity, along with Exxon and Valero, which are also working to boost the capacity of their refineries in Beaumont and Port Arthur, respectively.

However, some 1 million bpd of refinery capacity in America has been shut permanently since the start of the pandemic, as refiners have opted to either close losing facilities or convert some of them into biofuel production sites.

Operable refinery capacity was at just over 18 million bpd in 2021, the lowest since 2015, per EIA data from 2022. At the start of 2023, it was 18.1 million barrels daily, up by 0.6% from the start of 2022, the EIA said.

By Charles Kennedy for Oilprice.com

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