Bloomberg News

Consumers Co-op Shuts Coker at Saskatchewan Plant After Fire

February 11, 2013

Consumers’ Co-Operative Refineries Ltd.’s coker at the Regina refinery in Saskatchewan, Canada, will be shut for an “indeterminate” period after a fire, a company executive said.

Crude demand will be cut by a “minimum” of 10,000 barrels a day to about 80,000 barrels while the company forms a contingency plan, Bud Van Iderstine, senior vice president of refining, said in a conference call today.

Production at Unit 1, the heavy oil upgrader, was reduced by 11,000 barrels a day to 45,000, Van Iderstine said. Unit 2, which was refining 28,000 barrels a day of sour synthetic oil, was shut for a restart after the accident and will be running at that rate again within 24 to 36 hours, he said. Unit 3, which processes sweet synthetic, was unaffected.

There will be no impact on the retail network operated by Federated Co-op Ltd., parent of Consumers’ Co-Operative. Van Iderstine said the company’s gasoline and diesel inventories are adequate.

“Even if the coker is shut down for an extended period of time, we’ll still be able to produce the gasoline and diesel that we need,” Van Iderstine said.

Coker Fire

The fire broke out at about 12:30 a.m. in the coker at the heavy oil upgrader section of the plant and was put out by refinery personnel, according to the Regina fire department. It came as the plant was planning to start units that were shut after an October 2011 explosion.

The company didn’t know if the fire was related to the restart of those units, Daryl Oshanek, a Consumers’ Co-Operative spokesman based in Saskatoon, Saskatchewan, said in an e-mail.

The Regina refinery’s heavy unit processes Lloydminster heavy oil, which is a component in the Western Canada Select heavy oil blend. The price of Western Canada Select weakened against U.S. benchmark West Texas Intermediate oil for the first time in six days, falling 75 cents to a $25-a-barrel discount, according to Calgary oil broker Net Energy Inc.

In October, Consumers completed an expansion that increased Regina’s capacity by about 30,000 barrels a day to 130,000 barrels, making it Canada’s fourth-largest refinery, the company said. The project allows the plant to process more light synthetic crude and will add 15,000 barrels a day more in the future.

The 2011 explosion damaged a middle distillate and light naphtha unifiner, along with a gasoline isomerization unit. Those units were expected to restart late this month, Oshanek said in an e-mail Feb. 7. The company initially expected the units to start in November.

There were no injuries in today’s fire, Oshanek said.

To contact the reporters on this story: Christine Harvey in New York at charvey32@bloomberg.net; Edward Welsch in Calgary at ewelsch1@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net


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