Cheryl Ong Straits Times 3 Oct 11;
SHELL yesterday confirmed media reports that said it had declared force majeure on some of its customers.
Doing so excuses the oil giant from fulfilling its contractual obligations to them, following the 30-hour inferno at its Pulau Bukom refinery on Wednesday which forced the shutdown of the facility.
Mr Lee Tzu Yang, the chairman of Shell Companies in Singapore, said in a statement: 'We confirm that force majeure has been declared on some of our customers. We continue to be in discussions with our customers to address their supply of product needs and to minimise any potential impact to them.'
Force majeure, which means 'greater power' in French, is a common clause in contracts which frees both parties from liability when an event beyond the control of the parties occurs.
Industry speculation has been rife that Shell's refinery, which processes 500,000 barrels a day, may be shut down for a month.
'If it were to be shut down that long, losses would be in excess of US$60 million (S$78.4 million) for Shell,' said Mr Victor Shum, a managing consultant at energy consultancy Pervin and Gertz.
This would include loss of revenue, manpower costs and the cost of repairs.
The price of oil products has risen since the fire; Mr Shum noted that diesel prices have spiked some 10 per cent.
Mr Shum said that this was a normal knee-jerk response to a blaze like last week's, but that he expects prices to stabilise when regional refineries increase output to meet demand.
The refinery is Shell's largest in the world. Ninety per cent of its products are exported.
Meanwhile, the Singapore Civil Defence Force (SCDF) began a phased withdrawal of its fire-fighting team from Pulau Bukom yesterday morning.
Before noon, five fire engines, a red rhino and 10 support vehicles, along with 50 firefighters, were gone.
The SCDF will, however, maintain about 50 firemen and 18 vehicles on the island. It will fully withdraw once the situation is stable.
The pump house of the facility, the site of the fire, has been formally handed back to Shell.
Mr Lee said the company is now investigating the cause of the fire to prevent a repeat of the incident.
As of yesterday, traces of fuel vapour could still be detected in the affected area, said an SCDF spokesman.
A Shell spokesman yesterday said that the handover from SCDF to Shell is an important step towards bringing the situation back to normal at the refinery.
The company has started shutting down the rest of the refinery, except for those parts providing utilities, as a safety precaution. They are also conducting checks on air quality around Pulau Bukom four times a day.
'We do not expect any of the units to be restarted until a thorough investigation has been done and we are confident that it is safe to do so,' added the spokesman.
Shipping sources said the refinery resumed tanker berthing operations yesterday morning.
Mr Shum said these vessels could be picking up products undamaged in the fire; these are operations that can continue as they are unaffected by the shutdown of the facility.
A Shell spokesman declined to comment on its berthing operations.
Additional reporting by Aaron Low and Tham Yuen-C
SCDF to keep small presence on Bukom
Channel NewsAsia 2 Oct 11;
SINGAPORE: Shell has taken over its fire-hit oil refinery on Pulau Bukom from the Singapore Civil Defence Force (SCDF), who would maintain a small presence on the island, Shell said in a statement issued Sunday evening.
It added SCDF will fully withdraw from the island once the situation is stable.
Chairman of Shell Companies in Singapore, Lee Tzu Yang, said: "This handover is an important step towards bringing the situation back to normal at the refinery.
"Following the handover, we have commenced an investigation, supported by experts and together with the relevant authorities to establish the cause.
"Once completed, we will be applying any learnings to avoid such an occurrence in future."
Mr Lee said Shell is discussing with its customers to address their supply of product needs and to minimise any potential impact.
Shell confirmed that "force majeure" has been declared on some of its customers, which frees them from obligations due to extraordinary circumstances beyond control.
Earlier Sunday, SCDF scaled down its resources at Pulau Bukom oil refinery.
In the first draw-down phase, SCDF brought back 50 personnel and 16 vehicles.
Fifty personnel and 18 vehicles remain on the island to support Shell.
The SCDF had deployed 13 fire engines and 21 support vehicles and about 100 firefighters to the site, after fire broke out on Wednesday.
Traces of fuel vapour remain in the affected area.
The oil giant and authorities are monitoring the situation, while foaming operations continue in parts of the incident site.
Damage was confined to the vicinity of the pump house.
Other facilities and units are not affected.
-CNA/wk
SCDF begins to pull out fire-fighters from Pulau Bukom
Today Online 3 Oct 11;
SINGAPORE - The Singapore Civil Defence Force (SCDF) began a phased withdrawal yesterday morning of its fire-fighting team at the fire-hit site of Shell's Pulau Bukom oil refinery. The SCDF will, however, maintain "sufficient resources" to support Shell, which is managing the recovery phase after a 32-hour battle to put out the fire completely. Traces of fuel vapour remain in the affected area. The SCDF will fully withdraw once the situation is stable.
The SCDF deployed 13 fire engines and 21 support vehicles and about 100 firefighters to the site after fire broke out on Wednesday. As of yesterday morning, 18 SCDF vehicles and about 50 SCDF personnel remained on the island to support Shell. The SCDF said it had handed over the management of the incident site to Shell.
Mr Lee Tzu Yang, chairman of Shell Companies in Singapore, said, "This handover is an important step towards bringing the situation back to normal at the refinery.
"Following the handover, we have commenced an investigation, supported by experts and together with the relevant authorities to establish the cause. Once completed, we will be applying any learnings to avoid such an occurrence in future."
Damage was confined to the vicinity of the pump house, in an area 50m by 150m. Other facilities and units are not affected and only essential operating personnel are on the island.
Meanwhile, Shell resumed tanker berthing operations at the refinery yesterday morning, according to a Reuters report.
Mr Lee also confirmed that "force majeure has been declared on some of our customers". This means that the oil giant's ability to supply its distillates has been adversely affected by an event beyond Shell's control.
"We continue to be in discussions with our customers to address their supply of product needs and to minimise any potential impact to them," Mr Lee added.
"We wish to thank everyone involved in this effort for their tireless commitment in fighting the fire together with us over the past few days. We are also deeply appreciative of the tremendous support and assistance rendered to us by our industry partners and the Singapore Government," he said.
SCDF scales down resources at Pulau Bukom refinery
Channel NewsAsia 2 Oct 11;
SINGAPORE: The Singapore Civil Defence Force (SCDF) is scaling down its resources from Sunday morning at the fire-hit site of Shell's Pulau Bukom oil refinery.
It'll maintain sufficient resources to support Shell, which is managing the recovery phase after a 32-hour battle to put out the fire completely.
The SCDF had deployed 13 fire engines and 21 support vehicles and about 100 firefighters to the site, after fire broke out on Wednesday.
SCDF has handed the management of the incident site to Shell.
Traces of fuel vapour remain in the affected area.
The oil giant and authorities are monitoring the situation, while foaming operations continue in parts of the incident site.
Damage was confined to the vicinity of the pump house.
Other facilities and units are not affected and only essential operating personnel are on the island.
- CNA/cc
Shell declares force majeure on some of its customers
Firefighters begin withdrawing after refinery blaze is put out
Business Times 3 Oct 11;
SHELL has declared force majeure on some of its customers after the blaze at its refinery on Pulau Bukom, the oil firm said yesterday.
'We confirm that force majeure has been declared on some of our customers. We continue to be in discussions with our customers to address their supply of product needs and to minimise any potential impact to them,' Shell Singapore chairman Lee Tzu Yang said in a statement yesterday. Declaring force majeure allows a party with contracts that include such a clause to nullify its obligations, due to events that are beyond its control, such as war or flooding.
Firefighters began withdrawing from the Shell refinery on Pulau Bukom yesterday morning after the blaze was extinguished. The Singapore Civil Defence Force (SCDF) formally handed over the pump-house area, the site of the fire, back to Shell and began a phased withdrawal of its fire-fighting team, Shell said yesterday evening. The SCDF will maintain a small presence on Bukom to support Shell and will fully withdraw once the situation is stable, Shell said.
'This handover is an important step towards bringing the situation back to normal at the refinery,' Mr Lee said. Shell has started an investigation to establish the cause of the fire, he added.
The oil firm resumed tanker berthing operations at the refinery yesterday morning, Reuters reported, citing a shipping source. But the Bukom refinery, Shell's biggest processing plant worldwide, with a capacity of 500,000 barrels a day, is expected to be shut for at least a month, according to the Reuters report, which cited industry sources.
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