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Fire stalls key Chevron refinery

Repairs to start at Bay-area plant after major blaze; gas prices jump

Chevron Corp. sought to repair the core of its Richmond refinery Tuesday, the second-largest in California, after an hours-long fire caused a 25-cent spike in regional gasoline prices on worries that it could be down for months.

A fire in the crude unit sent a pitch-black plume high above this populous industrial suburb across the bay from San Francisco Monday evening, burning for more than four hours before being contained by 11 p.m., and extinguished overnight, Chevron said. A small controlled burn continued Tuesday.

As traders recalled that a 2007 fire on the same unit left the plant mostly idle for months, Los Angeles bench-mark gasoline premiums spiked nearly 25 cents. This drove up the cost of what is already the U.S.'s priciest motor fuel, in a boost to other West Coast refiners who may try to raise output as their margins touch fouryear highs.

Besides the damaged crude distillation unit, Chevron said other parts were still running at the 245,000 barrel-per-day plant, which accounts for one-eighth of California's refining capacity.

"We're working to repair the affected equipment so that we can resume normal operations as soon as we can do so safely," a Chevron official said in a statement.

With the CDU shut down, it was unclear how long secondary units - which rely on feed from the CDU to produce finished fuel like gasoline - can keep running.

Trade sources who saw images of the 12-metre flames feared the closure could last up to three months, although other experts said it was too early to say.

"There is a lot of volatile material there and so looks can be deceptive," said John Auers, a refinery specialist with Houston consultants Turner Mason. "If there is no major damage to the units, it could be a matter of days before it returns."

Richmond Mayor Gayle McLaughlin said she would seek a full investigation by Chevron and independent sources. Meanwhile, the Richmond Museum of History's event to mark 110 years of the refinery, scheduled for Tuesday afternoon, had to be postponed.

A total of 350 people went to the Kaiser Permanente Richmond Medical Center with respiratory concerns, but the hospital made no admissions as of Tuesday. At Doctors Medical Center in nearby San Pablo, 181 people sought help Monday for respiratory problems and eye irritation, and more were arriving Tuesday.

Both cities grew up in the shadow of Chevron's oldest refinery, and some wonder if the fire will sharpen debate between those who fear its environmental impact and others who say the declining industrial city needs the taxes and jobs.

"No one should have to live downwind of a dangerous oil refinery," said Leslie Fields, the Sierra Club's director for environmental justice and community partnerships.

Employing about 2,000 staff and 990 contractors, the plant is spread across nearly 12 square kilometres.

Chevron said three employees sustained minor injuries and were treated on site.