SKIKDA REFINERY FIRE EXPECTED TO HAVE NO EFFECT ON

UNCLAS ALGIERS 002055

SIPDIS

SENSITIVE

E.O. 12958: N/A
TAGS: EPET ETRD EWWT PTER PINR ASEC AG
SUBJECT: SKIKDA REFINERY FIRE EXPECTED TO HAVE NO EFFECT ON
PRODUCTION



1. (U) This cable has been sent sensitive but unclassified;
please protect accordingly.


2. (SBU) Algeria's second largest crude oil refinery at
Skikda experienced a fire October 4 that burned through the
night and into today. Early morning reports to us from local
industry officials said the fire had spread to three crude
shoretanks. While local firefighters had managed to stop the
spread of the fire, all units within the refinery were down
and industry representatives were doubtful any vessels would
be loaded in the next few days. Later in the morning,
however, Skikda Sonatrach officials told EconOff that
production would not be affected by the incident, and vessels
would be loaded as normal. As of 10:30 am local time,
industry sources on the ground reported to us that two tanks
were still on fire within the confines of the crude tank
farm, which comprises 18 tanks. They also reported that a
vessel docked alongside the terminal waiting to load a cargo
of fuel oil was unaffected. Industry representatives told
EconOff that not all the lines and tanks at the refinery had
been affected (which tracks Sonatrach information),but the
refinery has not yet resumed operations.


3. (SBU) According to Ministry of Energy sources who spoke
with us, an electrician contracted to replace an electrical
pylon set off a spark that caused the fire and spread to a
crude storage tank. The electrician burned to death and was
the sole fatality reported. Four colleagues of the
electrician were also reported in critical condition from
burns. Previous reports of an explosion at the facility
appear to be erroneous, as do initial unconfirmed casualty
reports of 27 dead and 600 injured.


4. (U) Background: Skikda is Algeria's largest crude oil
refinery with a designed capacity of 323,000 barrels/day.
The plant can process 15 million tons/year of Saharan Blend
crude and 300,000 tons/year of sour crudes imported through
the Skikda oil terminal, which is linked to the refinery by
pipeline. Algeria exports 1.4 million barrels of crude oil
daily, of which about 85% is destined for Western Europe.
Italy is the main market, followed by Germany and France. The
U.S. market accounts for the bulk of the remaining 15% of
Algeria's crude oil exports. Algeria is the third largest
U.S. source of liquefied natural gas imports at approximately
120 billion cubic feet per year.
ERDMAN