Fire breaks out at crucial Australian refinery, raising fuel supply fears

Columns of fire have engulfed the largest of Australia’s two oil refineries, just as the ⁠nation faces pressure to shore up fuel security with the Iran war disrupting global supply.

Victoria State fire authorities said the blaze, which broke out at a 120,000 barrels-per-day refinery in Geelong run by Viva Energy on Wednesday night, had been brought “under control” at noon (02:00 GMT) on Thursday.

Flames as high as 60m (200 feet) erupted after a gas leak ignited at the plant, firefighters said. It is one of only two working oil refineries in Australia.

The refinery, about an hour’s drive southwest of the state capital, Melbourne, pumps out about 10 percent of Australia’s fuel, according to energy company Viva.

The fire came at a bad time for Australia ⁠as it depends on imports for 80 percent of its fuel needs and has been racing to replace supply disrupted by the Middle East conflict, which has driven up energy prices worldwide.

Kevin Morrison, an energy finance analyst, said the wider Asia Pacific region has been facing a fuel security issue and Australia does not have major stockpiles.

“This key area of supply being knocked out for a non-known period of time is quite an issue,” Morrison said, speaking to Al Jazeera from Sydney.

He stressed that the plant is “a very old” one that started working in the 1950s and, because of the ongoing global oil crisis, it was working at maximum capacity.

Additional supplies

Prime Minister Anthony Albanese, currently visiting Malaysia, said on Thursday that Australia had secured an additional supply of some 100 million litres of diesel from Brunei and South Korea.

“This is the first of many expected shipments secured under the government’s new strategic reserve powers,” he told a news conference.

Wednesday’s fire ripped through a section of the refinery responsible for producing high-octane petrol, Energy Minister Chris Bowen earlier said.

By triggering isolation valves, other parts of the plant producing jet fuel and diesel had been spared the worst of the blaze.

Canberra urged Australians to ignore the impulse to rush out and panic-buy more fuel.

“It’s important that people buy as much fuel as they need, but no more, no less,” Bowen said.

‘Very challenging incident’

Incident controller Mark McGuinness said a “significant leak” of highly flammable gases and liquid hydrocarbons had triggered the inferno.

“It was quite ferocious. It went from a small fire through several explosions to a large, intense fire,” he told reporters.

Images taken on Thursday morning showed thick clouds of smoke billowing over the industrial complex.

Viva Energy boss Scott Wyatt said it was a “very challenging incident”.

“Production is not our primary priority today,” he told reporters. “Today, it is getting the site safe.”

Australia holds roughly 38 days’ petrol in reserve, according to government figures, far below the 90-day minimum dictated by the International Energy Agency.

While the government has so far resisted moves to ration fuel, it has urged drivers to conserve petrol where they can and to favour public transport if possible.

Like most nations in Asia and the South Pacific, Australia is heavily reliant on oil shipped through the Strait of Hormuz, which at one point carried one-fifth of the world’s oil and gas.

Shipping traffic through the vital waterway has essentially ceased since the United States and Israel launched their war against Iran on February 28.