Salt Lake Tribune
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Utah refinery shutdown could further pinch area gas supplies
This is an archived article that was published on sltrib.com in 2008, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Holly Corp. plans next week to shut down its Woods Cross refinery for up to 26 days for maintenance, a development that could further tighten gasoline supplies throughout the state.

The refinery, which processes approximately 26,000 barrels of crude oil a day, produces around 15 percent of the state's gasoline.

"We're still in the peak driving season, so a shutdown now could well tighten our fuel supplies," said Rolayne Fairclough, spokeswoman for AAA Utah. "For refineries, though, shutting down for maintenance is just something that has to be done occasionally. It is part of doing business."

Holly, however, said the 26-day maintenance shutdown will be used to further an expansion program at the refinery. When that expansion is completed, it will increase the Utah refinery's processing capacity by 20 percent, or another 4,000 barrels of crude per day.

"We are approximately three months from beginning to realize the benefits of our Woods Cross refinery upgrades," Matthew Clinton, Holly's chief executive, said in a company conference call earlier this week.

In preparation for the shutdown, the refinery has been building up its inventories of feed stock and refined products to help tide it over while its production is constrained, said Holly spokesman M. Neale Hickerson.

"The other refineries also will be helping us out by providing some of the product that we will need to supply our customers," he said. "Then when they're down for maintenance we will reciprocate."

Lee Peacock of the Utah Petroleum Association said most refineries plan their maintenance shut downs well in advance. "Refineries are complicated, hard working pieces of equipment that handle some real caustic chemical processes. They just have to be taken down occasionally so you can be sure they operate at peak capacity."

And the timing of maintenance activity depends upon when the outside companies they contract to do the maintenance work can get their equipment and manpower on site. "There is a lot of demand for their services," Peacock said.

Holly's expansion program includes the construction of a new hydrocracker unit, which will be used to break apart long chains of petroleum molecules so they can be more easily refined into gasoline, kerosene and diesel fuel. In addition, a new unloading facility will be built so the refinery can process additional "black wax" crude.

Black-wax crude, which is produced in many of Utah's oil patches, comes out of the ground at a consistency similar to petroleum jelly. It is thick and viscous, and unlike the "light, sweet crudes" that are popular feedstocks for refineries, black-wax crude usually isn't transported by pipeline. It typically needs to be trucked in insulated tankers and must arrive at its destination within four to eight hours or it will solidify. If that happens, the tanker's cargo must be warmed before it can be pumped out.

Holly's refinery in Woods Cross currently only processes about 5,000 barrels of black-wax crude a day. But Hickerson noted the upgrades now under way will allow the refinery to handle an additional 5,000 barrels of black-wax crude per day.

steve@sltrib.com

Utah's refinery capacity

Company

Daily crude oil processing capacity

FLYING J/BIG WEST

CHEVRON

TESORO

HOLLY CORP.

SILVER EAGLE

TOTAL

28,000 barrels

50,000 barrels

60,000 barrels

26,000 barrels

12,500 barrels

176,500 barrels

Source: U.S. Department of Energy

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