Dear Sole Judge, I hope this makes the cut. I read a statement supposed to have come from Senator Strom Thurmond, Chairman of the Armed Services Committee. The statement was that he is concerned that the oil refining industry estimates the US could lose 70% of their oil refining capacity in 2000. Does anyone have any information about this statement? If we lose that much fuel capacity how does any fuel get to electric plants? Trains and trucks would stop (not to mention us.) No fuel to electric companies. This happening would effectively shut down everything. Surely this statement is not true. Marcella

-- Anonymous, December 03, 1998

Answers

I talked with a reporter from an oil industry publication yesterday about this very topic. He stated he was not aware of any Year 2000 readiness survey of oil refineries.

At a briefing before Sen. Thurmond's committee, DOD's John Hamre said there were "some reports" claiming the industry would be 30% complete in renovations by 1/1/2000. However, the only report to my knowledge the uses those figures is a story that appeared in "World Oil" magazine in April. The story says,

"It is estimated that the average oil and gas firm, starting today (April 1998), can expect to remediate less than 30% of the overall potential failure points in the production environment."

The story concerned the Y2k issue from the E&P, or exploration and production, perspective. It was not directed at oil refineries, which convert the crude oil extracted in the E&P process into various fuel products.

At this point, through my conversations with oil processing observers, I cannot find anyone who will embrace the chance of a 70% shutdown of refineries at the date change.

-- Anonymous, December 03, 1998

From the World Oil website (http://www.worldoil.com/)

"Millennium bug should not be a problem for oil firms. E&P activities in 2000 should not be affected by the computer problem with the year ending in 00. Officials from 800 oil companies responding to a survey presented at a FERC conference said they are confident steps will be taken to ensure their readiness for the new millennium. About 33% will be ready by December 1998, 73% will be ready by June 1999, and all respondents will be ready by December 1999."

There is no mention of the oil refining industry Y2K prepareness.

-- Anonymous, December 03, 1998

I don't know for sure about the oil refineries, however, whenever I hear the words "We are confident" I cringe, this is laywerese for "do'nt get sued by saying to much". It is not illegal to be confident but for claiming to be compliant and then falling short you can be sued. "We are confident" says nothing.

-- Anonymous, December 04, 1998