Output cuts expected at Husky Energy's Lima, Ohio, refinery after explosion

(Reuters) - A loud explosion rocked Husky Energy's 155,000 barrel per day (bpd) crude oil refinery in Lima, Ohio, on Saturday and a source familiar with the facility's operations expected production slowdowns but not a complete shutdown. No injuries were reported in the blast, which occurred at about 6 a.m. local time. The explosion was heard across the city of Lima, according to local media reports. The blast involved the 26,000-barrel-per-day isocracker unit, according to the source familiar with the facility's operations. It was not yet known what caused the blast. An isocracker is a type of hydrocracking unit, which uses hydrogen under high heat and pressure to increase the amount of motor fuels made from crude oil. The source said the isocracker is situated in a section of the refinery called the Lima Integration Unit, built around 1970. That section includes the crude unit, hydrocracker, naphtha hydrotreater, and reformer, which are the most modern part of the plant, according to documents filed with the U.S. Securities and Exchange Commission. They are separate from older parts of the plant, including the delayed coker and catalytic cracker, according to the documents. The isocracker unit was previously damaged in a 2009 fire, Reuters has reported in the past. All personnel were accounted for at the refinery, Husky spokesman Mel Duvall said. He did not say which units were involved in the fire or how production was affected. The refinery gets about 65,000-bpd of crude imported from Canada, a mix of light and medium grades, according to the latest data from the U.S. Energy Information Administration. In addition, it runs domestically produced crude oil. Because gasoline inventories have been high, the fire is unlikely to impact the prices of crude or refined products, said John Kilduff, a partner at Again Capital. "I think what's going to be telling here is to highlight how bearish the complex is," he said. "If King Abdullah being ill couldn't get a rally going, I doubt a small refinery fire at the Lima refinery will have any impact, either," he added, referring to the Saudi king's illness with pneumonia earlier this month. The weather in the northern United States has been bitterly cold this week, with some areas seeing wind chill temperatures below 0 Fahrenheit (below -17 Celsius). Husky did not say whether the cold temperatures had affected the refinery's performance. BP Plc shut a crude distillation unit at its Whiting, Indiana, refinery on Thursday night. Husky is Canada's third largest integrated energy company and is controlled by Hong Kong billionaire Li Ka-shing. (Reporting by Erwin Seba in Houston and Jarrett Renshaw in Philadelphia; Editing by Louise Heavens, Jessica Resnick-Ault and Frances Kerry)

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