Blog: Strikes show French refining vulnerability

Refinery strikes now easing in France highlight vulnerabilities of the country’s refining industry, especially in comparison with that of the US, according to analysts at Turner, Mason & Co. (OGJ Online, May 26, 2016).

Strikes at six of eight French refineries have crippled the industry, wrote John Mayes and John Auers in a June 14 blog post on Turner, Mason’s web site.

A refining industry strike in the US last year, the first in many years, had much less effect on operations because managers, supplemented by support staff, worked in place of strikers.

In France, labor laws “complicate the operation of French refineries” and “will certainly impact future investment decisions, Mayes and Auers wrote.

A general strike that began last month to protest labor reforms became work stoppages affecting railroads and sanitation services as well as refineries and terminals.

The government approved withdrawal from strategic oil reserves. Much of the lost middle-distillate products, which dominate French demand, were replaced by supply from the Amsterdam-Rotterdam-Antwerp (ARA) refining center.

The writers said Total’s 247,000-b/d Gonfreville l’Orcher refinery, France’s largest, remains down.

Restarting are Total’s Donges (219,000 b/d), Feyzin (109,000 b/d), and Grandpuits (101,000 b/d) refineries.

Total’s 153,000-b/d La Mede refinery restarted quickly after the strike and is now at 80% of capacity.

The other refinery hit hard by the strike, Petrolneos’s 207,000-b/d Lavera facility, is operating at reduced rates.

Exxon’s two French refineries, Fos-sur-Mer (133,000 b/d) and Port Jerome (236,000 b/d) are operating normally.

Mayes and Auers noted that the disruption drew down ARA product inventories and improved normally thin European refining margins.

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