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Shell Shuts Gasoline Unit at Pernis Refinery on Fault (Update2)

By Nidaa Bakhsh

Sept. 25 (Bloomberg) -- Royal Dutch Shell Plc was forced to shut a gasoline-making unit at Pernis, Europe's largest oil refinery, after a fault occurred last night, pushing up prices of the motor fuel.

A so-called catalytic cracker ``tripped because of a mechanical fault and went offline,'' Shell spokesman Wim van de Wiel said today by telephone from The Hague, where the company is based. Production of gasoline and its components has been halted, he added, without saying when the unit would resume output.

The unit has a capacity of 50,000 barrels a day, according to data compiled by Bloomberg.

Gasoline swaps prices for loading next month in the Amsterdam-Rotterdam-Antwerp area rose $5.42, or 0.6 percent, to $893.49 a metric ton at 10:12 a.m. U.K. time, according to PVM Oil Associates Ltd.

The shutdown comes as Shell, Europe's biggest oil company, and other refiners plan seasonal maintenance, curbing output. Operators will shut at least 6 percent of Europe's processing capacity for repairs next month, reducing fuel inventories at a time when increased volumes are being sent to the U.S. to meet a shortfall caused by Hurricanes Gustav and Ike.

The fault at the 416,000-barrel-a-day Pernis plant near Rotterdam was detected at about 8:30 p.m. local time yesterday and resulted in the release of a fine, grain-like sand into surrounding areas, Van de Wiel said. Shell is investigating the cause, he said.

September Maintenance

Maintenance on one of two crude-distillation units at the site was due to begin at the end of September and last for as long as six weeks, two people familiar with the work said Aug. 20.

Scheduled maintenance on fluid catalytic crackers is taking place this month at Chevron Corp.'s 220,000-barrel-a-day Pembroke plant in Wales and Repsol YPF SA's 120,000-barrel-a-day La Coruna refinery in Spain.

Repairs on gasoline-making units will also be carried out on Total SA's 158,000-barrel-a-day La Mede unit in France and Cia. Espanola de Petroleos SA's 223,000-barrel-a-day Gibraltar facility from next month.

To contact the reporter on this story: Nidaa Bakhsh in London at nbakhsh@bloomberg.net

Last Updated: September 25, 2008 07:40 EDT

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