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Reuters: Shell says may cut output at Deer Park, TX, refinery

Wed Jun 14, 2006 9:32pm ET

HOUSTON, June 14 (Reuters) – Shell Oil Co. may cut output at a 340,000 barrel per day (bpd) joint-venture Houston-area refinery in Deer Park, Texas, due to a leak in a hydrogen plant, a refinery spokesman said on Wednesday night.

The decision to cut output will likely be made on Thursday, refinery spokesman David McKinney told Reuters.

The leak in a heat exchanger gasket at the refinery’s Hydrogen Plant-1 was discovered on Tuesday morning, according to a notice filed with the Texas Commission on Environmental Quality, the state pollution control agency.

Hydrogen is used by refineries to reduce sulfur content in motor fuels in compliance with tightening U.S. regulations. The Deer Park refinery processes high-sulfur Latin American crude oil.

Shell and PMI Norteamerica S.A. de C.V., a subsidiary of Mexican state oil company Petroleos Mexicanos (Pemex) operate the refinery through Deer Park Refining LP, a 50-50 joint venture.

The Deer Park refinery, located on a 1,500-acre complex shared with a chemical plant along the Houston Ship Channel, is the sixth largest U.S. refinery.

Shell Oil Co. is a subsidiary of Royal Dutch Shell Plc. (RDSa.L: Quote, Profile, Research).

© Reuters 2006. All Rights Reserved.

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