Freezing temperatures across Texas during the extended holiday weekend forced energy companies to shut oil refineries in the largest U.S. crude-producing state and restricted natural gas pipeline operations.
The rare deep freeze prompted the state’s electric grid operator to impose rotating blackouts, leaving nearly 3 million customers without power.
President Joe Biden declared an emergency on Monday, unlocking federal assistance to Texas.
Texas produces roughly 4.6 million barrels of oil a day and is home to some of the nation’s largest refineries, spread throughout the Gulf Coast. In Midland, heart of the U.S. Permian shale region, temperatures were in the single digits Fahrenheit.
Motiva Enterprises said it was shutting down its Port Arthur, Texas, complex, which includes its 607,000 barrel-per-day refinery—the largest in the United States.
Exxon also began shutting its 369,024 bpd Beaumont refinery and its 560,500 bpd Baytown refinery and adjoining chemical plant in Texas, sources familiar with plant operations said.
Its Baton Rouge facility in Louisiana experienced operational issues.
Citgo Petroleum Corp said some units at its 167,500 bpd Corpus Christi, Texas, refinery were being shut.
Sources familiar with plant operations said earlier that the crude distillation unit, a reformer and a hydrotreater were shut by cold weather at the refinery, with all other units also being powered down.
The cold snap also forced Lyondell Basell’s 263,776 bpd Houston refinery to operate at minimum production and shut most units at Marathon’s 585,000 bpd Galveston Bay plant.
“We are also getting reports of power outages across the Permian, which are expected to continue over the weekend if the current weather system persists. This may result in intermittent production shut-ins, with a moderate impact on Permian oil production expected in February,” Rystad Energy’s head of oil markets, Bjornar Tonhaugen, said in a note.
Energy distribution was stalled across large parts of the United States.
Kinder Morgan’s Natural Gas Pipeline Co. reported capacity constraints at various locations on its pipeline system, while Enable Gas Transmission said it was taking measures to ensure adequate supply for customers.
Oil pipeline operator Enbridge Inc. said on Monday a 585,000 bpd crude oil pipeline that runs from its terminal near Pontiac, Illinois, outside of Chicago, to the largest U.S. oil storage hub in Cushing, Oklahoma, was halted because of power outages.
“Crews are working with electric utility providers to restore power to Line 59,” as the pipeline is called, said Enbridge spokesman Michael Barnes. “The power failure is due to the winter storm the U.S. is experiencing.”
Colonial Pipeline Co, the largest oil products pipeline in the United States, said there were no significant impacts to operations at the moment due to the weather.
The icy weather conditions also prompted Port Houston public terminals to cease vessel operations from Sunday evening through Monday.
By Arpan Varghese