A Massive Oil Refinery in Texas is reportedly a premature shutdown that could increase pressure on domestic fuel supplies amid the rising gas prices and pocket-squeezing inflation across the United States.
According to the reports, the oil refinery is currently producing more than 200,000 barrels of fuel per day.
However, the Houston-based facility which is currently being operated by LyondellBasell Industries will be scheduled to close permanently by the end of 2023 but will halt the operations earlier if a “major equipment failure” spreads to major units, two people familiar with the issues revealed.
The facility that spans 700 acres and was built in 1918 is reportedly processing 268,000 barrels per day (bpd) of oil and produces 92,600 bpd of diesel fuel, 89,000 bpd of gasoline and 44,500 bpd of jet fuel.
On Tuesday, LyondellBasell released an official statement claiming that “the Houston Refinery is currently operating as planned.”
“LyondellBasell previously announced it will cease operations of the Houston Refinery no later than December 31, 2023. In the interim, the company will continue serving the fuels market, which is expected to remain strong near-term.” The company added.
In April, LyondellBasell also announced the reason behind the sudden shut down. According to the company, it would shut the refinery by 2024 due to the heavy financial burden of upgrading its more than 100-year-old infrastructure.
“The company determined that exiting the refining business, by the end of next year, is the best strategic and financial path forward,” the company added in its statement.
In the data released by the Energy Information Administration, it was revealed that the refinery is among the top 25 largest-capacity facilities in the U.S.
“Overall, operating U.S. refineries had a capacity of about 17.7 million bpd of oil and produced about 9.5 million bpd of gasoline, 4.7 million bpd of diesel fuel and 1.3 million bpd of jet fuel in 2021.” The Dailycaller reported.
The federal data also revealed that six refineries with a capacity of about 801,000 bpd of oil have shuttered over the last two years amid the pandemic while five refineries with a capacity of 408,100 bpd of oil are idle.
“The COVID pandemic really drove down gasoline and diesel demand which accelerated some things that were already happening,” Geoff Moody, the vice president of government relations at the American Fuel & Petrochemical Manufacturers said.
