US oil sector recovery from Hurricane Sandy

New York (Platts)--6Nov2012/500 pm EST/2200 GMT

The US Northeast was gradually returning to service Tuesday following widespread outages last related to Hurricane Sandy. Below is a summary of the most recent developments:

SHIPPING

--Three foreign-flagged oil product tankers heading to the Canadian East Coast from the US Gulf Coast may be diverted to the storm-hit Northeast, shipping sources said Tuesday.

--Two companies have notified the US Maritime Administration they plan to take advantage of a temporarily lifted shipping law to move petroleum products from the Gulf Coast to the Northeast on foreign-flagged vessels. The Department of Transportation said November 5 the companies planned to transport petroleum products and fuel additives to the region hit by Sandy. The agency would not disclose any other details.

--The Department of Homeland Security November 3 widened the Jones Act waiver to include feedstocks, blending components and additives used to make fuels. The US has lifted the Jones Act shipping law through November 13. Some foreign-flagged vessels that could bring Gulf Coast products to the Northeast have failed to meet inspection standards, analyst reports said.

REGULATIONS

--The US Environmental Protection Agency temporarily waived the use of 15 ppm sulfur diesel fuel (ULSD) for on-road and off-road and permitted the use of heating oil (2,000 ppm diesel) in New Jersey; New York, including New York City; and Pennsylvania.

--EPA last week issued a temporary RFG gasoline waiver to 16 states plus the District of Columbia until November 20.

REFINERIES

--Philadelphia Energy Solutions' 330,000 b/d plant was operating at full capacity Tuesday. "We are producing at full strength... [the units] were well protected during Hurricane Sandy and we came through the storm in excellent condition," said PES spokeswoman Cherice Corley.

--Phillips 66 said Monday its 238,000 b/d Bayway refinery will be back to normal operations in two-to-three weeks. The company has reopened its fuel terminal to wholesale customers and continues to ramp up service. The terminal is expected to return to full operation by the end of the week, and is now open for tanker truck loading on a 24-hour basis.

--Full restart of the Hess' 70,000 b/d Port Reading, New Jersey, refinery was "several days away," the company on Sunday. Full power will be required to be restored before a full assessment of refinery equipment can be done and the restart process gotten underway.

PORTS AND TERMINALS

--Nine petroleum terminals in New York and New Jersey remain closed, the Department of Energy said Tuesday. NuStar Energy has resumed normal operations at its terminal in Linden, New Jersey. Still closed are three Hess terminals in New Jersey; Citgo's Linden, New Jersey, terminal; two Motiva terminals in New York; two Motiva terminals in New Jersey; and Phillips 66's facility in Tremley Point, New Jersey. A total of 48 terminals along the East Coast have reopened, according to DOE.

--Most of Sprague's 15 products terminals in the Northeast and Mid-Atlantic saw only minor damage due to Sandy, a company official said Tuesday. Grant Brown, Sprague vice president of investor relations and marketing, said the Oceanside, New York, terminal "received significant damage to the tanks, but this facility had no activity prior to the storm."

--Kinder Morgan has resumed limited operations at its New York Harbor terminals in Carteret and Perth Amboy, New Jersey, a spokeswoman said Monday. The facilities are working off portable generators. Kinder is using generators to supply power to its Staten Island, New York, terminal, as well.

--The US Coast Guard opened the Arthur Kill waterway, which leads into the ports of New York and New Jersey, to commercial traffic with restrictions late Saturday. BP, Kinder Morgan, Phillips 66, Gulf Oil, NuStar, Shell, Motiva, Hess and ST Linden have terminals on Arthur Kill. USCG also said Lower New York Bay had opened, with restrictions. Chapel Hill Channel had not yet been surveyed as of Saturday.

--The International-Matex Tank Terminal in Bayonne, New Jersey, resumed partial service Saturday, DOE said, citing trade press reports. A Sunday update by maritime consultant Moran Shipping said IMTT-Bayonne has begun receiving vessels and also deliveries via Colonial Pipeline.

--Sunoco's Newark, New Jersey, and Inwood, New York, terminals were completely flooded and could be offline for weeks given the need for substantial repairs, the company said Friday.

PIPELINES

--Colonial Pipeline Tuesday said it was servicing eight refined products terminals in New York Harbor and hoped to add six more by the end of the week. Colonial is the main system transporting refined products from the Gulf Coast to New York Harbor terminals.

--Buckeye Partners said Saturday it had restarted operations at its New Jersey, New York and Pennsylvania pipeline systems. The system runs from Linden to facilities in Long Island and Pennsylvania and upstate New York.

RETAIL

--Some 24% of retail gasoline stations in the New York metropolitan area had no gasoline available for sale as of Monday due to supply disruptions, according to EIA. The figure was down from about 27% on Sunday.

--Staff reports, newsdesk@platts.com
--Edited by Robert DiNardo, robert_dinardo@platts.com