LyondellBasell to restart fire-damaged Houston coker by mid-June

HOUSTON, May 16 (Reuters) -- A coking unit at LyondellBasell's Houston refinery is expected to restart between late May and mid-June for the first time since being damaged in an April 8 fire, Gulf Coast market sources said on Monday.

"It won't be back by Memorial Day," one of the sources said about the coker referring to the national holiday on May 30. "The refinery may be running at 250,000 bpd by the Fourth of July."

The refinery, which has a capacity of 263,776 bpd, is expected to reach a daily crude oil intake of 200,000 bbl this week for the first time since April 15, the sources said.

A Lyondell spokeswoman said the company expects the coker to return to production by the end of the second quarter of this year. She declined to discuss the status of other units at the refinery.

The coker was one of four units shut between April 8 and 15 in a string of unit outages and accidents at the refinery that forced production down to 85,000 bpd.

Between May 1 and May 8, Lyondell restarted the small crude distillation and two vacuum distillation units, which were shut due to leaks. The large CDU remained in operation, though at reduced throughput.

CDUs do the initial refining of oil coming into a refinery and provide feedstock to all other production units. VDUs and cokers refine the residual crude the CDUs could not process, increasing refining yields. Cokers also convert residual crude that cannot be refined further into petroleum coke, a coal substitute.

If the VDUs and cokers are not operating, refineries have to cut the amount of crude oil being processed by the CDUs.

The 42,000-bpd coker is undergoing repairs from the fire and to piping refinery officials believe had suffered extensive corrosion during at least two decades of use, the sources said.

The wall of the pipe that ruptured igniting the April 8 blaze was said by the two sources to have been very thin due to abrasion and corrosion from the petroleum coke passing through it.

There are two cokers at the refinery. The 57,000-bpd coker remains in operation.

The refinery has ordered over 1,000 feet of Chrome-Moly pipe to replace piping on the shut coker, the sources said. Chromium and molybdenum would make the coker piping more resistant to corrosion than the piping that failed, the sources said.