By Anita Komuves and Krisztina Than
BUDAPEST (Reuters) -Hungarian oil and gas company MOL was gradually restarting units at its Danube refinery following a late Monday fire at one of the plant’s crude units, the company said on Tuesday.
By midday, the fire was contained and largely put out and there were no injuries, MOL said, with its executive saying there was no evidence of foul play.
“We have seen no signs that any external tampering played a role in the outbreak of the fire,” Krisztian Pulay, downstream production and development senior vice president at MOL told a news briefing, without elaborating on the cause of the fire.
He also said the company had no estimate yet of how it could affect production and would begin assessing the damage in the next 24 hours.
The refinery, which has a capacity of 165,000 barrels of crude oil daily, according to MOL’s website, largely processes Russian crude delivered via the Druzhba pipeline. It effectively covers Hungary’s domestic demand for oil products, International Energy Agency’s data shows.
The AV3 unit, which sustained the fire, processes over 40% of the refinery’s crude intake according to LSEG data.
MOL TO CONSIDER TAPPING STRATEGIC RESERVES
Hungary’s fuel supply was secured, and the company will focus on the domestic market in the immediate future and consider the use of strategic reserves if needed, MOL said in a separate statement on Tuesday.
MOL’s shares were down 1.5% at 1034 GMT.
The fire could disrupt the refinery’s production for months, said Tamas Pletser, a regional energy analyst at Erste Investment in Budapest, likely forcing MOL to increase fuel imports or temporarily use Hungary’s strategic reserves.
At the end of September, Hungary had enough crude and petroleum product reserves to cover 96 days, according to data on the Hungarian Hydrocarbon Stockpiling Association’s website.
The fire may also affect Hungary’s fuel supply to Serbia. Budapest said earlier this month that MOL would increase deliveries to Serbia after the United States imposed sanctions on its Russian-owned NIS refinery.
Prime Minister Viktor Orban said that he had discussed the fire with MOL’s leadership.
“We will investigate the circumstances of the fire at the Szazhalombatta oil refinery with the utmost rigour,” Orban wrote in a post on Facebook.
(Reporting by Krisztina Than and Anita Komuves, additional reporting by Gergely Szakacs; Editing by Jamie Freed, Shri Navaratnam and Thomas Derpinghaus and Tomasz Janowski)
