Alaska refiner seeks to offset fire-damaged plant

ANCHORAGE, Alaska, Dec 30 (Reuters) Arctic Slope Regional Corp said on Tuesday it is considering ramping up production at its oil refinery near Fairbanks to compensate for the shutdown of its fire-damaged plant near Valdez.

The 48,000-barrel-per-day Petro Star refinery near Valdez has been shut down indefinitely after a fire broke out over the weekend, damaging the processing facility and associated piping, the company said.

"Once we have a better understanding of the extent of the damage we will have a better assessment on how long the refinery is actually closed," said Tara Sweeney, vice president of external affairs for Arctic Slope. "We're still trying to get a handle on what happened."

Sweeney said the company planned to seek an exemption to Environmental Protection Agency restrictions that limit output at its refinery in the Fairbanks suburb of North Pole as a way of compensating for the lost production in Valdez.

The Valdez refinery normally draws about 48,000 barrels of crude a day from the nearby Trans Alaska Pipeline and produces 13,000 barrels of product daily, including 9,300 barrels of jet fuel, 3,200 barrels of diesel and 300 barrels of a fuel used to generate electricity by the local Valdez utility, according to Arctic Slope.

The rest of the residual crude is pumped back into the Trans Alaska Pipeline system.

The Valdez refinery typically sends jet fuel to Anchorage, where it is used at the Ted Stevens Anchorage International Airport and at Elmendorf Air Force Base. Both the Anchorage airport and the base have alternative suppliers, Sweeney said.

There were no injuries in the fire, and the cause has yet to be determined, according to Arctic Slope and Valdez city officials. Fire crews working late Sunday night put out the blaze within two hours as they battled rough weather, including 50-mile-an-hour wind gusts, city officials said.

Arctic Slope, based in Barrow, is owned by Inupiat Eskimos of the North Slope and is one of the 13 regional Native corporations established by the 1971 Alaska Native Claims Settlement Act. (Reporting by Yereth Rosen; Editing by Richard Valdmanis)