Chevron Expects Richmond Refinery Back At Full Capacity Early In 2013
RICHMOND (CBS SF) - Chevron's Richmond oil refinery should be fully functional again during the first quarter of 2013, once repairs to the crude oil unit devastated by a massive fire in August have been completed, a company spokesman said Friday.
Crews have been working to repair the crude oil unit, a key part of the local refinery's operations, since a corroded pipe exploded and sparked the large-scale blaze on Aug. 6, greatly reducing Chevron's production capacity.
"This is a major refinery. It produces about 10 percent of California's gasoline, so having it offline has definitely made the gas supply in the state more vulnerable," said Severin Borenstein, co-director of the Energy Institute at UC Berkeley's Haas School of Business.
Gas prices will not plummet once the refinery is back at capacity, but Borenstein said consumers can expect to pay a little less once Chevron completes repairs.
"If Chevron really waits till the end of the first quarter, to late March or into April, we'll definitely be at more risk for a price spike in February and March."
Chevron spokesman Derek Jansen said in a written statement that Chevron has been working with the city of Richmond to secure the permits needed to repair the damaged equipment and resume normal operations.
He said Chevron remains focused on cooperating with multiple federal and state investigations into the root cause of the fire.
Chevron announced in an earnings report Frday that its total U.S. refinery crude oil input was 779,000 barrels per day in the most recent quarter, down 118,000 from a year ago. The report said the decrease was primarily due to the Richmond refinery fire.
The Richmond refinery produced an average of 257,000 barrels of oil each day in 2011, said Jansen.
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