Gulf Coast Gasoline Strengthens After Hovensa Desulfurizer Fire

Spot gasoline in the Gulf Coast gained after a fire in a distillate desulfurizer at Hovensa LLC’s St. Croix refinery.

The unit at the 525,000-barrel-a-day refinery in the U.S. Virgin Islands where the fire broke out Feb. 11 isn’t one of the units Hovensa plans to shut when it cuts distillation capacity to 350,000 barrels a day, Alex Moorhead, a spokesman for the plant, said in an e-mail.

The discount for conventional 87-octane gasoline in the Gulf Coast narrowed 0.63 cent to 5.5 cents a gallon versus futures traded on the New York Mercantile Exchange at 2:06 p.m., according to data compiled by Bloomberg. Prompt delivery rose 4.41 cents to $2.4662 a gallon.

Hovensa, a joint venture of state oil company Petroleos de Venezuela SA and Hess Corp., said on Jan. 26 it would shut some processing units permanently at the plant to trim losses.

Motiva Enterprises LLC’s Norco, Lousiana, refinery released unknown amounts of butadiene, benzene and hydrogen sulfide because of equipment failure, according to a filing with the National Response Center.

Motiva’s Port Arthur plant in Texas has operating conditions that require the flaring of gases, according to a recorded message left on a community hotline.

Motiva is a refining and marketing joint venture of Saudi Refining Inc., a subsidiary of Saudi Arabian Oil Co., and Shell Oil Co., a unit of Royal Dutch Shell Plc.

Ted Rolfvondenbaumen, a Shell spokesman, declined to comment on the events, citing competitive reasons.

Conventional 87 octane gasoline in New York Harbor strengthened 0.5 cent to a discount of 2.13 cents a gallon against futures.

To contact the reporter on this story: Paul Burkhardt in New York at pburkhardt@bloomberg.net.

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.

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