BP
warns its investors
By
Lynn J. Cook and Anne Belli
Houston
Chronicle
HOUSTON
Petroleumworld.com 01 13 06
BP's Texas City refinery, which has the capacity to turn 440,000
barrels of crude oil into fuels like gasoline and diesel every
day, is the third largest in the United States.
The
troubled Texas City refinery, along with hobbled oil and gas production
in the Gulf of Mexico, will cost BP roughly another $1 billion.
BP,
the world's second-largest publicly traded energy company behind
Exxon Mobil, issued a warning to investors on Wednesday saying
it would have been able to book about $1 billion more for the
fourth quarter had it been able to sell more Gulf Coast crude
and churn out gasoline and diesel from the Texas City complex.
The
company also expects to take an additional $400 million hit to
the bottom line for restructuring its European marketing and refining
operations, where it is laying off at least 1,000 people.
Four
months after Hurricanes Katrina and Rita roared through the Gulf
of Mexico, BP has 160,000 barrels of oil equivalent per day that
remains shut in.
Even
more problematic is BP's Texas City refinery, which had three
incidents last year -- including one that killed 15 people and
injured another 170.
BP's
Texas City refinery, which has the capacity to turn 440,000 barrels
of crude oil into fuels like gasoline and diesel every day, is
the third largest in the United States.
Most
of the area's refineries sustained relatively minor wind damage
and were running full tilt within a week or two of the storm.
Not BP.
BP
powered down the entire refinery ahead of Hurricane Rita in September
and remained down to make upgrades agreed to in its settlement
with federal investors in the wake of the March blast.
A
source inside the refinery also said BP is taking this time to
make environmental upgrades. BP has also pledged it will put $1
billion over five years to upgrade and maintain the Texas City
plant and give workers more safety training.
The
company initially said it would take a few weeks to bring the
Texas City refinery back online.
Then,
in early October BP told the Chronicle the steam generation and
distribution system would be running toward month's end, with
gasoline production following shortly behind.
BP
commented on the Texas City delays in its third-quarter report
to the U.S. Securities and Exchange Commission, saying the refinery
would restart late in the year with gasoline production coming
back in December.
BP
is now mum about when it intends to restart the refinery, but
one source inside the refinery said a company-planned late March
restart is doubtful.
That's
because even though the plant is shut down for repairs, safety
problems persist and projects keep getting delayed, the source
said.
For
instance, late Tuesday evening two workers for Cemex, a concrete
manufacturer, were delivering a load to the plant when they reported
they were exposed to benzine, according to a Cemex spokesman.
Cemex
immediately pulled its employees out of the refinery and sent
them to a clinic where they could be tested for contamination.
The concrete delivery was never made and the company and the workers
are awaiting the test results.
Houston Chronicle, 01
12 06
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Houston Chronicle.
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