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PES refinery expected to shut remaining units as crude dwindles: sources

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Crude shipments destined for PES have been diverted following the June 21 fire and explosion there.

New York

THE Philadelphia Energy Solutions (PES) refinery, the oldest and largest on the US East Coast, is expected to shut its remaining units on Monday as the plant uses up the last of its crude supplies, sources said on Wednesday.

The refinery is still weighing the economics of running more crude oil to keep the units active for an extended period, they added.

Crude shipments destined for PES have been diverted in the weeks after the June 21 fire and explosion at the 335,000-barrel-per-day refinery, according to data and trade sources.

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The fire, which started in an alkylation unit in the Girard Point section of the Philadelphia complex caused PES to begin closing the facility without an intended restart.

Roughly 1,000 workers are expected to be laid off and contractors who do business with the refinery will also be affected by the shutdown.

PES, which emerged from bankruptcy last year, has multiple owners, including investment bank Credit Suisse and investment firm Bardin Hill.

PES has long been a steady buyer of imported crude oil, particularly from West Africa. Its loss as a buyer threatens to shrink the last steady US market for West African crude.

Last year, US refiners imported 180.7 million barrels of crude oil from Africa, according to US Energy Information Administration figures.

The PES refinery imported 43.1 million barrels from Africa in 2018, second only to the Phillips 66 refinery in Linden, New Jersey among US refineries.

A cargo with one million barrels of Nigerian crude oil chartered by the PES refinery was rerouted on Wednesday to Point Tupper, Nova Scotia, a crude oil storage hub in Canada, according to data intelligence firm Kpler.

Another cargo chartered by PES carrying one million barrels has been sitting idle in the waters near the refinery for about two weeks, Kpler data shows. REUTERS