U.S. oil supermajor ExxonMobil has reduced the run rates at its second-largest U.S. refinery in Baton Rouge, sources with knowledge of the operations at the 502,500-bpd refinery told Reuters on Monday.
Exxon reduced the production processing rate to some 440,000 bpd on Saturday, and the number of contract workers was reduced by 1,800 on Friday, Reuters sources said. The Baton Rouge facility typically employs around 2,000 contract workers.
The Baton Rouge refinery is Exxon’s second-largest refinery and the second-biggest refinery in the state of Louisiana.
As OilPrice.com notes, demand for fuel around the globe is taking a major hit as people are asked or ordered to stay at home to stem the spread of the coronavirus pandemic. U.S. oil demand is set to tumble over the following weeks, as cities are under lockdown, nonessential businesses and services are closed, and people are asked to work from home wherever possible.
Exxon spokesman Jeremy Eikenberry told Reuters the spending cuts will be announced when final decisions are made.
“We are notifying contractors and vendors of our intended reductions, and they may be adjusting their staffing and budgets accordingly,” Eikenberry said.
The number of contract workers at the refinery is usually 2,000 and increases when major overhauls are underway, sources familiar with operations said. Contract workers are employed by the third-party service companies that Exxon has been informing of its spending plans.