MOSCOW (MRC) -- A deep freeze across Texas took a toll on the energy industry in the largest US crude-producing state, shutting oil refineries and forcing restrictions from natural gas pipeline operators, reported Reuters.
The cold snap prompted the state’s electric grid operator to impose rotating blackouts, while President Joe Biden declared an emergency on Monday, unlocking federal assistance to Texas.
Texas produces roughly 4.6 MMbpd of oil and is home to some of the nation’s largest refineries, spread throughout the Gulf Coast. In Midland, heart of the US Permian shale region, temperatures were in the single digits Fahrenheit.
Motiva Enterprises said it was shutting down its Port Arthur, Texas complex, which includes its 607,000-bpd refinery, the largest in the United States.
Exxon also began shutting its 369,024-bpd Beaumont, Texas refinery, while its Baton Rouge facility in Louisiana experienced operational issues.
Citgo Petroleum Corp. said some units at its 167,500-bpd Corpus Christi, Texas refinery were being shut. Sources familiar with plant operations said earlier that the crude distillation unit, a reformer and a hydrotreater were shut by cold weather at the refinery, with all other units also being powered down.
The cold snap also forced Lyondell Basell’s 263,776-bpd Houston refinery to operate at minimum production and shut most units at Marathon’s 585,000-bpd Galveston Bay plant.
“We are also getting reports of power outages across the Permian, which are expected to continue if the current weather system persists. This may result in intermittent production shut-ins, with a moderate impact on Permian oil production expected in February,” Rystad Energy’s head of oil markets, Bjornar Tonhaugen said, in a note.
Energy distribution was stalled across large parts of the United States.
Kinder Morgan’s Natural Gas Pipeline Co. reported capacity constraints at various locations on its pipeline system, while Enable Gas Transmission said it was taking measures to ensure adequate supply for customers.
Oil pipeline operator Enbridge on Monday said a 585,000-bpd crude oil pipeline that runs from its terminal near Pontiac, Illinois, outside of Chicago, to the largest U.S. oil storage hub in Cushing, Oklahoma, was halted because of power outages. “Crews are working with electric utility providers to restore power to Line 59,” (as the pipeline is called), said Enbridge spokesman Michael Barnes. “The power failure is due to the winter storm the US is experiencing.”
The icy weather conditions also prompted Port Houston public terminals to cease vessel operations from Sunday evening through Monday.
As MRC informed earlier, last year, Exxon Mobil Corp announced it will lay off about 1,900 employees in the United States as the COVID-19 pandemic batters energy demand and prices.
We remind that ExxonMobil has undertaken a planned shutdown at its cracker in Singapore. The company halted operations at the cracker for maintenance on September 14, 2020. The cracker was expected to remain off-line till end-October, 2020. Located at Jurong Island, Singapore, the cracker has an ethylene production capacity of 1 million mt/year and a propylene production capacity of 450,000 mt/year.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.