The owner of the East Coast’s largest oil refinery announced plans to shutter the facility following a fire last week that set off explosions and damaged the complex.
Continue Reading Below
Philadelphia Mayor Jim Kenney confirmed the news in a statement Wednesday that Philadelphia Energy Solutions will close its refinery. Kenney said he was “extremely disappointed for the more than one thousands who will be immediately impacted by this closure.”
“We will immediately convene a group of City and quasi-governmental organizations to discuss the economic and employment impacts, and what the city is able to do in response,” Kenney said in a statement. “We are also retooling the plans of the working group led by the city’s Managing Director and Fire Commissioner to focus efforts on determining the future of the refinery, assisting PES to transition the site safely, communicating with local residents, and supporting the employees impacted PES’ decision.”
These agencies are investigating the blaze: the Occupational Safety and Health Administration; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the U.S. Chemical Safety and Hazard Investigation Board; and the Philadelphia Fire Department, according to the Oil & Gas Journal.
The Philadelphia Inquirer reported union leaders were slated to meet with the company Wednesday. Ryan O’Callaghan, the president of the United Steelworkers Local 10-1, which represents the plant’s workers, called the announcement “a disgrace.”
“This is what they do to us after we safely shut down the plant while fighting a fire,” O’Callaghan told the Philadelphia Inquirer.
PES said the 150-year-old oil refining complex processes 335,000 barrels of crude oil daily. The refinery turns the crude into gasoline, jet fuel, propane, home heating oil and other products.
The company emerged from bankruptcy last year after restructuring its debt.
On Friday morning, a blaze broke out at the Philadelphia Energy Refining Complex at a tank containing a mixture of butane and propane. Five workers were treated for minor injuries and nearby residents were told to keep indoors. The cause of the blaze was not immediately known. It was the second blaze in two weeks at the refinery, Reuters reported.
Analysts said gasoline prices in the Northeast could rise over the next few weeks as a result of the explosion but an increase will likely not last long, Claudio Galimberti, a refining analyst at S&P Global Platts, said.
U.S. gasolines future increased 5.4 percent Wednesday to $1.9787 a gallon, Reuters reported. The increase was the highest since May 23.
The Associated Press contributed to this report.