HOUSTON Feb 24 Refiners and pipeline shippers
in the Salt Lake City area are facing new delays obtaining crude
oil after a pipeline outage last week was followed by snow on
Friday that made it difficult to deliver much-needed oil by
Refiners such as Tesoro Corp and HollyFrontier
have been using trucks to replenish oil supplies after
Plains All American Pipeline took its Wahsatch pipeline
down last week as a precaution after monitoring equipment
detected an anomaly.
Last week, Plains said the line would be down for several
days. On Tuesday, the pipeline operator sent a note to customers
informing them construction and reactivation efforts would begin
once it received final work authorizations.
The pipeline restart is being held up because a landowner
will not allow Plains crews on a privately held ranch to make
necessary repairs, three sources familiar with the situation
said this week.
Representatives from Plains did not respond to repeated
requests for comment.
The 16-inch Wahsatch pipeline can carry roughly 100,000
barrels per day of crude from locations near Evanston, Wyoming,
to Salt Lake City refineries.
In the notice to shippers on Feb. 21, Plains said
"coordination with landowners continues" and that it could
complete construction in five to seven days once it receives
HollyFrontier's Woods Cross refinery is running at reduced
rates of around 30,000 to 31,000 barrels per day, versus the
high-30,000s, the company said during an earnings call this
Tesoro, which operates a 63,000 barrel-per-day refinery in
Salt Lake City, resumed running on a reduced production schedule
this week. The refinery was shut last week due to a combination
of planned maintenance work and the pipeline shutdown.
Chevron operates a refinery in Salt Lake City, but
it has not been impacted, the company said.
Chevron, Tesoro and HollyFrontier did not immediately
respond to requests for comments on Friday.
The Utah Department of Transportation issued a road weather
alert through Friday afternoon due to snow showers. The weather
is making trucking operations around Salt Lake City difficult,
two sources said.
Regular unleaded gas prices in Salt Lake City were averaging
$2.31 a gallon on Friday, up from $2.243 a week ago, or about 3
percent, according to AAA.
(Reporting by Liz Hampton and Erwin Seba in Houston; Editing by