Singapore, 28 July (Argus) — Taiwanese private-sector refiner Formosa Petrochemical is asking buyers to defer product shipments, with loading delayed after a fire forced the 540,000 b/d Mailiao refinery to shut down on 25 July.

Exports of jet fuel, gasoline and diesel will be postponed for an unspecified period on a case by case basis, Formosa said. For very prompt deliveries, or buyers that have already chartered vessels, the refiner will negotiate to load reduced volumes, a company spokesman said.

Formosa exports on average each month 10 medium range size cargoes of diesel, two to three cargoes of jet fuel and around eight cargoes of gasoline.

Term customers such as Vietnam's state-owned importer Petrolimex may issue spot tenders to cover the deferred supplies. Petrolimex imports at least one cargo each of gasoline and diesel from Formosa each month through term contracts.

Expectations of tighter Taiwanese diesel supplies have lifted the market, while helping to counter limited arbitrage prospects to Europe or the US. The intermonth crack spread has strengthened from $0.30/bl to $0.15/bl.

Formosa, which also buys naphtha as a feedstock for petrochemical production, will not import or defer any naphtha shipments because of high inventories. An earlier shutdown of a 160,000 b/d No.1 naphtha cracker, also because of an explosion, already forced the refiner to defer the arrival of some of its term supplies.

The refiner will restart tomorrow, or the following day, two of the three unaffected crude distillation units (CDUs) that total about 360,000 b/d. The fire, which broke out at the 80,000 b/d residual desulphurisation unit of the remaining 180,000 b/d CDU, was finally put out yesterday afternoon.

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