UPDATE 10-Philadelphia refinery fire threatens facility's future

Firefighters on Friday were working to bring under control a massive fire at Philadelphia Energy Solutions Inc's refinery that has resulted in damage that could keep much of the complex shut for an extended period, according to Philadelphia city officials and company sources. Philadelphia fire officials said several explosions sent a massive fireball into the sky, engulfing the surrounding areas in smoke after 4 a.m. EDT (0800 GMT), following the ignition of a fire that started in a butane vat at the 335,000 barrel-per-day (bpd) refining complex, the largest and oldest on the U.S. East Coast.

"It is standard practice when fighting a fire of this type to let the flammable gases burn away in a controlled fashion," the fire officials said. PES said in a statement it believed the product that was burning was "mostly propane."

Four workers were injured, according to a company statement, and treated on-site. The extent of the damage was unknown. "It was the worst I've ever experienced," said a veteran refinery worker who was at the plant when the fire broke out.

"It looked like a nuclear bomb went off. I thought we were all going to die." The complex is still running at a reduced rate, PES said, but depending on the extent of the damage, there will be questions as to whether the company has enough money to rebuild. It comes just after a June 10 fire at the same refinery, which according to a source familiar with operations, affected a 50,000 bpd catalytic cracking unit..

PES said in the statement that there were three explosions at the refinery, which affected an alkylation unit. A source familiar with plant operations said one explosion occurred at a 30,000 bpd alkylation unit that uses hydrofluoric acid, one of the deadliest chemicals in the refining business and a source of controversy.

City health officials said there is no immediate danger to the surrounding community. Preliminary testing at the refinery and the adjacent community showed no ambient carbon monoxide, hydrocarbons (combustibles), or hydrogen sulfide, said Philadelphia Department of Public Health spokesman James Garrow in a statement. In the past, refinery workers have called for refineries to stop using hydrofluoric acid because of the harm it can do to the eyes, skin and lungs when released into the atmosphere following explosions.

An explosion at a Los Angeles-area refinery in 2015 kept that plant mostly shut for several years. In April 2018, a refinery fire and subsequent explosions in Superior, Wisconsin, threatened the release of hydrofluoric acid. That refinery is still shut and not expected to resume normal operations until 2021. About 300,000 people live within three miles of the Philadelphia refinery, according to a 2018 study by California's South Coast Air Quality Management District, an air quality agency that oversees the Los Angeles area. That makes it the most densely populated area near a refinery that uses HF alkylation.

The incident comes after years of financial struggles for the refinery, which has slashed worker benefits and scaled back capital projects to save cash. It went through a bankruptcy process last year to reduce its debt. The company emerged from bankruptcy in 2018 with $148 million in cash, only to see that fall to $87.7 million just three months later.

Analysts said gasoline supply in the Northeast could be affected by outage. Gasoline futures rose 3.7 percent on Friday on the news. The region is likely to boost fuel imports from Europe that are "likely to result in a short-term spike" in already-high gasoline prices, analysts at FGE Energy said in a note.