Shortly after visiting the very lean and modernized Cedar Creek Wind Farm, we wound our way northwest to a very windy, cold Cheyenne, WY, just across the Colorado border, and toured Frontier Oil Corporation’s refinery. Frontier has been refining since the ’30s and has staked its reputation and business model on refining heavy, sour crude or oil that is laden with asphalt and sulfur. This includes the infamous tar sands current being piped down from Canada. The company is small and does none of its own drilling and exploration, so the model is extremely sensitive to heavy crude prices. Frontier effectively lives off the margin between heavy crude and the various refined products – gasoline, diesel, kerosene, butane – that the plant sells wholesale to local distributors. The margins have not been kind to Frontier as of late due to abnormally high crude prices and, a little over a year ago, the severe drop in gas prices that accompanied the Crash of 2008. As a result, the plant has been steadily laying off employees.
The outer fabric of Frontier’s new corporate offices convey the impression of a robust and healthy business, but a glimpse inside its eerily quiet corridors or its bubbling, steaming refining yard looked to me like an empire slowly crumbling, a business that has almost no chance of a stable existence, in the era of Peak Oil, climate regulation and the destructive competition that will ensue if alternative energy is allowed to compete on a level playing field with fossil fuel.
This could all be said of any oil refinery in the country, because in truth Frontier is the oil industry in microcosm: reactive rather than proactive; clinging to a highly successful but increasingly challenged way of doing business. For example, from what I could glean from company representatives, nearly all of the major safety or environmental upgrades to the plant – whether they be the relocation of management offices outside of the refinery’s “blast zone” or the improvement of wastewater treatment processes – appeared to be a reaction to a regulation (one that was no doubt bitterly fought by the industry) or in some cases to a catastrophic accident elsewhere in the industry. Take the relocation of management offices outside of the refinery perimeter. This was done in response to BP’s infamous Texas City explosion in 2005, which killed 15 employees and injured 170, mainly due to the unfortunately location of their office spaces. Until recently, it was either not a great enough concern or beyond imagination that a blast at Frontier could have effectively eviscerated the corporate offices. The same casual lack of imagination in matters of safety and risk seem to permeate the industry. Do I even need to mention Deepwater Horizon here?
All of the people we met at the refinery were wonderful to us, and more importantly, they seem to legitimately care for each other’s safety and the safety of the surrounding community and environment. Isn’t this impossible if you work at an oil refinery? To an outsider, yes, but when you run a high risk operation on a daily basis, I think it is quite easy to blind yourself to your business model and industrial process, both of which put the public and environmental health at risk on a daily basis. Our tour guide – who is clearly proud of Frontier’s track record on safety and the environment – openly admitted that, were the alkilation unit at the plant to fail catastrophically, it would spew its caustic hydrogen fluoride into the atmosphere, putting the south side of Cheyenne at serious risk. And even knowing that there is a finite probability of this occurring, I think he still sleeps pretty well at night.
It is important to note that Frontier has a highly redundant safety system in place to prevent such an event. The Frontier representatives highlighted the ability of their safety and control systems to unleash thousands of gallons of water if HF leaks were to occur. But recent coverage of BP’s now-infamous blowout preventer should give you pause when anyone discusses foolproof safeguards in the oil industry. Accidents happen and even the most meticulously designed preventative measures only count for so much when a six-sigma event will unleash untold destruction. Later in the tour, we inquired about a large holding tank that looked like a muffin bursting out of the pan. That was apparently what happens when you mix water with 300-degree asphalt. And the soap suds we saw floating out of the cooling towers? Guess someone added a little too much oil dispersant to the mix that day. The simple fact is that, even with a fully automated plant, shit happens. But when you throw humans in the mix, it’s just a game of roulette.
It has actually been over a month since my visit to Frontier, but the tour has had a lasting impression. I have come to develop a much deeper respect for the devilish spate of processes required to put gas in my tank and the crew of brave (foolhardy?) individuals who work in that environment. I’ve also been trying to avoid putting gas in my tank.