Valero restarts part of Texas refinery after explosion, diesel unit still shut

The partial restart at Valero’s Port Arthur refinery has begun to restore some fuel output, but the larger shutdown at the Texas complex still matters for gasoline, diesel and jet fuel across the Gulf Coast and beyond. The plant, which can process 380,000 barrels a day, resumed operations on the 115,000-bpd AVU-147 crude distillation unit, while the larger 210,000-bpd AVU-146 unit remains out of service after a March 23 explosion and fire.

That larger unit is the one that carries the most market weight. Crude distillation units are the first major step in a refinery, splitting crude oil into feedstocks that move through the rest of the plant. Valero’s AVU-146 alone accounts for about 2% of crude refining capacity across Texas, Mississippi and Louisiana, a region that holds more than half of total U.S. refining capacity. It also represents 3.4% of Texas atmospheric crude distillation capacity, giving the outage significance well beyond the refinery fence line.

The company said in a March inspection that it found a damaged tube in the heater tied to the larger unit, and Valero plans to restart AVU-146 once the repair is finished. Until then, the plant is operating with a major constraint still in place, limiting how much crude can be pushed through the complex and how much downstream fuel output can return. That leaves the Gulf Coast product system more exposed at a time when even short refinery outages can ripple into national fuel pricing.

Safety questions remain part of the story. The original blast and fire hit the refinery’s diesel hydrotreater, and no injuries were reported at the time. Still, one person has filed a lawsuit claiming he was injured when he was knocked to the ground. The damaged heater tube and the need for repairs add another layer to the operational challenge, underscoring how quickly a localized incident can turn into a wider reliability problem.

Markets already felt the disruption. Diesel prices rose 16 cents after the explosion forced the refinery to shut down, showing how tightly balanced refined products can be when a large Gulf Coast plant goes offline. The partial restart may ease some of that pressure, but with the bigger crude unit still shut, the risk of tighter supplies and more volatility has not gone away heading into the spring and summer driving period.