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Reuters: INTERVIEW-Shell says market favorable for refinery growth

Tue Sep 18, 2007 9:33pm BST
 
NEW ORLEANS, Sept 18 (Reuters) Shell Oil Co. President John Hofmeister said conditions are favorable for an increase in refining capacity as the company moves closer to a decision on doubling the size of a joint-venture refinery in Texas.

“We make long-term decisions,” Hofmeister said. “We think that the long-term supply relationship with the marketplace says it’s now time for more manufacturing capacity.”

Shell has said it and joint-venture partner Saudi Refining plan to decide by the end of the year on increasing refining capacity at the 285,000 barrel per day (bpd) Motiva Enterprises refinery in Port Arthur, Texas, to 600,000 bpd.

The boards of directors of both companies will have to sign off on the expansion, which the company hopes to finish by 2010, but which will affect its future for 25 to 30 years, he said.

“We want to make sure it’s a good decision and I think we’re close,” Hofmeister said.

The Port Arthur refinery was one of three shut last week when Hurricane Humberto knocked out electrical power as it moved over east Texas.

The refinery was 30 minutes into a planned shutdown ahead of the hurricane when the power went out, he said.

The refinery’s restart is being done as safely as possible, Hofmeister said.

Shell is the U.S. unit of Royal Dutch Shell Plc (RDSa.L: Quote, Profile, Research).

 © Reuters 2007. All rights reserved.

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