BP Shuts Units, Cuts Runs at Texas City Oil Refinery

BP Plc was forced to shut units and curtail operations because of a malfunction at its Texas City refinery, the fourth-largest in the U.S.

BP is still determining how long the units will be off line, spokeswoman Sheila Williams said today by telephone from London, where BP, Europe’s second-largest oil company, is based. The malfunction occurred in a sulfur recovery plant early yesterday morning, Williams said.

Production rates from units that produce large amounts of sulfur, such as cokers and hydrotreaters, have been reduced, a person familiar with the refinery operations said.

The fault may reduce supplies of gasoline as demand recovers before the peak summer driving season. The Texas City refinery, which can process 475,000 barrels of oil a day and is BP’s largest, returned to normal operations at the end of 2008 after a blast killed 15 people three years earlier.

BP expects to flare, or burn off gases into the air, until 2:30 a.m. local time tomorrow, according to a filing with state environmental regulators. An estimated 30,000 pounds of sulfur dioxide may be emitted during the flaring, which began at 2:30 a.m. yesterday, the filing showed.

Gasoline for April settlement rose $1.08, or 0.8 percent, to $1.297 a gallon at 7:02 a.m. local time on the New York Mercantile Exchange.

Flares are safety devices that prevent excessive pressure from building up in processing units that are being shut down or started up. Sulfur-recovery plants capture and hold sulfur removed in fuel-processing.