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Refinery readies for multimillion dollar upgrade

Delek Refining is gearing up to shut down its Tyler refinery for 45 days to make millions of dollars in upgrades and expand its production capacity.

The Tyler plant will go from being a 62,000-a-barrel-a-day refinery of crude oil to 74,000 barrels a day. The crude expansion will be a $67.4 million project, Louis LaBella, vice president and general manager for the Tyler refinery, said.

The shut down, called a turnaround, will begin next Wednesday and run through March. It will have 21 units of people working at the same time in an organized system and will result in 500,000 hours worked. He said there will be 1,300 people working in the facility during the peak time in February, including more than 1,200 contractors from 35 companies. Several local engineering contractors will be a part of the project, he added.

LaBella gave an update about the project Tuesday to the Tyler Area Chamber of Commerce Board of Directors.

Delek buys crude oil directly from producers or from brokers, with the majority coming to them through a pipeline. It boils the crude oil and makes refined products, such as gasoline, aviation and jet fuel and diesel, out of it; and sells products to every service station in a 60-mile radius, he said.

When asked what his biggest challenge is at the refinery, LaBella said it would surprise the board members.

“The biggest challenge I have right now is filling jobs,” he said.

There are 400 people now onsite getting ready for the shutdown and preparing for the outages, LaBella said.

“We’ve got a lot of work going on. This work has been going on for the last two years,” he said, adding that the business has been planning the turnaround for that long.

The turnaround happens every five years to meet regulatory guidelines for them to inspect, clean, renovate and make any changes to the plant in a limited amount of time. He said the company takes a financial hit during the turnaround, but it allows them to do necessary cleaning and to revamp the refinery to make it more competitive.

Changes also will result in greater production of diesel, from 25,000 barrels a day to 36,000 barrels; and from 22,000 barrels a day of gasoline to 28,000 barrels, LaBella said.

Some of the expansion work will be done to handle lighter crude, which makes more gasoline and less diesel and asphalt. In the last eight months, crude has continued to become lighter, and he expects that trend to continue, he said.

Another large investment of $12.7 million will go toward replacing the reactor, which took 80 trucks and a 1,500-ton crane to bring in and four weeks to assemble.

Other upgrades include $12.7 million to revamp “Cat” equipment made in 1979, $4 million to reinforce the infrastructure for cooling; and $14 million to go from two steam turbines to the more efficient electric, he said.

Delek will begin shutting down the plant next Wednesday but mechanical work will start Jan. 26. Although the plant will reopen on March 1, it will finish the turnaround work in mid-March.

Shari Rickman,general manager and vice president at the Tyler Convention and Visitors Bureau, said the last time Delek did a turnaround, it brought in a lot of contractors to local hotels and was a huge economic impact to the city.

Tyler Chamber President and Chief Executive Officer Tom Mullins said Delek is one of Tyler’s largest taxpayers and has a tremendous amount of investment in the community.

LaBella, who has been in the oil and gas industry for 28 years, was brought to the Tyler refinery by the company to change its culture, he said. After a tragic explosion that killed two workers several years ago, he said they have made changes and focus greatly every day on safety.

In 2014, they had no accidents that resulted in lost time from workers, he said, adding that they also emphasize contractor safety as well as employees.

He said their first goal is safety, followed by being on time and staying on budget.

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Refinery readies for multimillion dollar upgrade

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