Philadelphia Energy Solutions Refinery Surprises With Shutdown Plan, Loss of 1,000 Jobs

What to Know

  • Around 4 a.m. Friday, a mixture of butane and propane ignited a fire that caused three explosions.
  • Engineers will be called in to determine the structural integrity of the tangle of metal tanks, smoke stacks and piping.
  • PES has a private fire brigade, but city firefighters and medics remain at the site including the hazmat task force.

The South Philadelphia oil refinery that caused a series of massive explosions will close within the next month and go up for sale.

Philadelphia Energy Solutions said in a statement that last week's fire "made it impossible" to continue operations. 

"I want to thank our employees for their hard work and dedication," the statement read in part.

As a result of the impending closure, more than 1,000 jobs will be eliminated, according to city officials. 

During an earlier interview with NBC10 earlier this week, Mayor Jim Kenney gave no indication he knew a shutdown was imminent despite saying that his administration kept in daily contact with PES senior officials.

"You have to remember: we want people to be safe first and foremost. But there are a lot of jobs there," Kenney said when asked if he would like to see a drawdown of the refinery's operations.

"There’s a lot of decent paying jobs there and we can’t just discount that. We have to figure out what happened, why it happened, what we can put in place to prevent it from happening again and we’ll see what the future brings."

But after news broke that the 150-year-old refinery would be sold, Kenney said he was "disappointed" that so many workers would lose their jobs. 

"The City is committed to supporting them during this difficult time in any way possible," Kenney said in a statement Wednesday.

Earlier in the day, Philadelphia's Hahnemann University Hospital also announced that it would close this summer, potentially eliminating thousands of additional jobs in the city.

An explosion and subsequent inferno rattled entire parts of the region less than a week ago, reigniting a debate among city leaders and residents who worried about the safety of the oil refinery, which is considered the largest single source of pollution in the area.

City Councilwoman Helen Gym, one of the most vociferous voices calling for the refinery to close, said via Twitter that the "city has a lot of work to do to prioritize clean energy and sustainable futures for everyone."

"It’s enraging that profiteers perpetuated the illusion that this refinery was ‘safe' ... at the expense of neighbors’ safety and workers’ livelihoods," she said in a statement Wednesday.

NBC10 cameras were rolling as an explosion occured at the Philadelphia Energy Solutions refinery in South Philadelphia around 4:22 a.m. Friday, June 21, 2019.

To alleviate some of the economic burden, Pennsylvania Gov. Tom Wolf announced that the Department of Labor & Industry activated its Rapid Response Coordination Services to assist PES employees. The team will connect workers with unemployment insurance, training programs, job search activities and other social service programs.

Kenney also said Wednesday that Philadelphia officials will convene a group of "quasi-governmental organizations" to look at the economic repercussions of shutting down the refinery.

The Philadelphia Fire Department and the city's managing director will also lead efforts to determine the future of the site.

The refinery is the largest on the East Coast, and the sudden announcement of its closure is likely to have an effect on the U.S. markets. Within hours of the explosion last Friday, gasoline futures jumped 3.5%.

Last week's fire burned for two days until plant staff were able to turn off a valve that sent fuel into an alkylation unit. City fire officials and the refinery's private fire brigade let the fire burn to avoid the uncontrolled release of explosive gas into the atmosphere.

Philadelphia Fire Department Commissioner Adam Thiel said most of the fuel burned was similar to what fuels gas barbecue grills.

A joint investigation between his fire marshal's office, city police and the ATF is underway, Thiel said. While a fire is no longer burning at the site, the incident has yet to be placed under control because investigators are unable to tour the entire affected area.

A representative from the Pennsylvania Department of Environmental Protection said that agency plans to inspect the large gas storage tanks nearby to ensure they were not damaged by the fire.

Pictures: South Philadelphia Refinery Explosion and Fire

The refinery complex, which is split into two refineries and dates back to the 1800s  — producing gasoline, diesel, jet fuel and other fuel. It is the single largest cause of particulate pollution in Philadelphia.

Philadelphia Energy Solutions emerged from bankruptcy protection in October 2018. At the time, the limited liability company owed the local and state government more than $3 billion. The amounts were negotiated down to tens of thousands of dollars.

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