The ninth largest US refinery went offline this week. The timing couldn’t be worse given the war-driven global supply shortages.
This week an explosion shut down Valero’s Port Arthur refinery.
The timing is uniquely painful.
With the Strait of Hormuz effectively closed and crude and product shortages spreading globally, losing a major US Gulf Coast refinery hits differently than it would in a normal market.
The important news first: no injuries have been reported, which is a blessing.
Before I launched KSG, I was the Chief Strategy Officer at Pinnacle, an industrial reliability solutions company that served the petroleum refining sector.
One thing that experience taught me: the complexity of refining is routinely underestimated.
⚠️ We’re driving chemical reactions at extreme temperatures and pressures, in the presence of aggressive catalysts, across massive interconnected systems where fluids in various thermodynamic states travel surprisingly long distances.
The fact that catastrophic incidents aren’t more common is a testament to the expertise embedded across this industry.
But every refining executive will tell you even one incident is one too many.
The causes are well understood physically and chemically.
▶️ The challenge is coverage: maintaining effective detection and intervention across enormous, aging asset footprints before small failures cascade into large ones.
As the world navigates war-driven shortages, there is more incentive than ever for refineries with access to energy and feedstock to run at full capacity.
This week is a reminder of the tension that creates, and the importance of reliability when we’re asking more of the assets that are still able to work.
