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Terminal News

Storage spill & explosions as Harvey continues to thrash Gulf Coast

Picture credit: NASA
Picture credit: NASA
Tropical Storm Harvey continues to wreak havoc along the Gulf Coast.

At least 33 people have been killed in eastern Texas in the aftermath of the storm as the region continues to experience catastrophic flooding.

Heavy rainfall is expected from Louisiana to Kentucky over the next three days and many oil majors, pipeline and storage operators have shut down or halted operations as a result.

On Tuesday, August 29, rising water levels within the Guadalupe river system washed out four storage tanks at one of ConocoPhillips' well sites in DeWitt County, Texas.

The tanks are used to temporarily store produced oil and produced water from the well. The tanks held approximately 385 barrels of oil and 76 barrels of produced water but the actual spill volume has not been determined. At the time, the well remained shut-in, so no oil and water were flowing to the tanks.

The company says that all applicable federal and state regulatory agencies were notified immediately.

Colonial Pipeline

As of Wednesday, August 30, Colonial Pipeline's facilities west of Lake Charles, Louisiana are temporarily out of service due to the storm. Due to supply constraints and the suspension of its facilities, Colonial's line 2, which transports diesel and aviation fuels, was suspended Wednesday night. Line 1, which transports petrol, was suspended on Thursday, August 31.

The company says once it is able to ensure that its facilities are safe to operate and refiners in Lake Charles and points east have the ability to move product to Colonial, its system will resume operations.

Alan Gelder, Wood Mackenzie vice president research, says that the closure is a major disruption of the US East Coast and that US East Coast buyers are 'scrambling for supplies'.

'Typical Colonial Pipeline volumes are equivalent to Europe's petrol exports, so these volumes will be difficult to replace and will require supplies from distant regions if the outage is prolonged.

'At the peak of the disruption, 4.5 million bpd of refining capacity was shutdown. We estimate that 2 million bpd of petrol and 1.4 million bpd of distillates have been lost in the US Gulf Coast.'

Explosions at Arkema

In the early hours of Thursday morning, Arkema was notified of two explosions and black smoke coming from its plant in Crosby, Texas. An evacuation zone of 1.5 miles from the plant had been previously established. It shut down operations on the Friday before the storm made landfall.

The company says: 'Our site followed its hurricane preparation plan in advance of the recent hurricane and we had redundant contingency plans in place. However, unprecedented flooding overwhelmed our primary power and two sources of emergency backup power. As a result, we lost critical refrigeration of the products on site. Some of our organic peroxides products burn if not stored at low temperatures.

'Organic peroxides are extremely flammable and, as agreed with public officials, the best course of action is to let the fire burn itself out.'

Organic peroxides are used in applications such as making pharmaceuticals and construction materials.

According to S&P Global Platts, Motiva, Total and Valero have closed their Port Arthur plants, however Valero is in the process of restarting its Corpus Christi and Three Rivers refineries and Marathon is restarting its Texas City plant.

The Houston Ship Channel was closed Wednesday to incoming and outgoing traffic and port condition Zulu remains for Louisiana port Lake Charles and Texas ports Beaumont, Nederland, Orange, Port Arthur, Port Neches, Sabine and Sabine Bar.

Corpus Christi port plans to return to normal operations on September 4.

Picture credit: NASA