January 30th, 2014:

Husky Energy Inc. (HSE)’s refinery in Lima, Ohio, isn’t producing diesel because it needs to replace a pump in the unit that makes the fuel, according to a person familiar with operations.The plant hopes to make the repairs to the diesel hydrotreater this weekend, said the person, who asked not be be identified because the information isn’t public. The unit has been offline for about a week. Ultra low sulfur diesel on the spot market in Chicago strengthened by 12.5 cents a gallon to a premium of 7.5 cents above futures on the New York Mercantile Exchange at 2:37 p.m., according to data compiled by Bloomberg. It’s the biggest premium for the fuel since June.

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Mel Duvall, a Husky spokesman, declined to comment on refinery operations in an e-mailed statement. The refinery, which has the capacity to process 160,000 barrels of crude a day, is running at between 100,000 and 120,000 as workers struggle to keep pipes thawed amid freezing temperatures, according to the person.

Source: Bloomberg

January 31st, 2014:

BP is dropping plans to invest in a refinery in China, three sources with direct knowledge said, the fourth refining project in recent months to fall foul of a slowdown in growth in the world's second-largest economy. China's fuel consumption rose at the slowest clip in more than 20 years in 2013, ending a decade of rapid demand growth that drove global oil prices to over $100 a barrel and made gaining access to China's restricted retail market a mouth-watering prospect for international oil firms. While the fuel market cooled, construction of new refineries continued apace, leaving a capacity glut that hurt refinery profit margins and led to a rapid rise in Chinese fuel exports in 2013. "There is growing concern of an over-supplied China market, so BP is taking its precautions," said one oil industry executive, who declined to be named as he was not authorised by his company to speak to the media. BP is dismantling the 20-strong Beijing-based team tasked with studying the feasibility of taking a stake in a refinery in the southern coastal city of Qinzhou, the sources said. The team is being reassigned after around two years working on the project to invest in the 200,000 barrels-per-day plant, run by China's second-largest refinery operator, state-run PetroChina.

PetroChina is currently upgrading the plant to handle a wider variety of crude. The plant cost $2.5 billion to build and started operating in late 2010. Both BP and PetroChina spokesmen declined to comment. PetroChina said in a report earlier this month that it had put off starting up two new refineries - a 400,000-bpd joint venture with Venezuela and a 200,000-bpd plant in potential alliance with Saudi Aramco - and delayed expansion of another to counter the threat of overcapacity as oil demand growth slows. Slow progress on the project and BP's internal drive to cut costs contributed to the company's decision to drop the investment plan, the sources said. While it has made no headway in refining in China, BP has invested some $4.4 billion in the country's energy sector. Those investments include the country's first receiving terminal for liquefied natural gas, a major offshore gas field in the South China Sea, a petrochemical complex in Shanghai and 800 petrol stations - one of the largest for an international energy firm.  International oil majors have gained limited footholds in China's refining business, which is tightly held by PetroChina and Asia's largest refiner, Sinopec Corp. The two firms dominate crude and gas output and imports as well as refining capacity. US major Exxon Mobil has the biggest presence among oil majors in the refining sector, jointly running a 240,000-bpd refinery and an 800,000-tonne-per-year petrochemical complex in partnership with Sinopec Corp. France's Total holds a stake in PetroChina-controlled export refiner WEPEC. Royal Dutch Shell's plan to build a $13 billion refinery and petrochemical complex in east China stalled last year, first over a land issue and then by the change of strategy of partner PetroChina to cut back on refining spending.

Source: Reuters

January 30th, 2014:

A major Red Sea oil refinery joint venture between Saudi Arabia and China is on schedule and expected to be operational in the third quarter of this year, state news agency SPA reported the kingdom's Oil Minister Ali al-Naimi as saying on Thursday. Yanbu Aramco Sinopec Refining Co's (YASREF) 400,000 barrels day (bpd) refinery, a joint Saudi Aramco and Sinopec venture is slated to process heavy crude from Saudi Arabia's 900,000 bpd Manifa oilfield. "Work at this new refinery is proceeding according to a specific schedule and will operate at a production capacity of 400,000 bpd during the third quarter of this year," Naimi said after touring the facility with oil ministry officials in Yanbu, Saudi Arabia's second largest industrial hub after Jubail. The refinery will produce cleaner fuels such as 10 parts per million (ppm) ultra low sulphur diesel. The main products of the refinery will be 3,000 bpd of benzene, 263,000 bpd of diesel, 90,000 bpd of gasoline, 6,200 tonnes per day of pet coke and around 1,200 tonnes per day of sulphur. Aramco has already started operating and exporting products from its new refinery in Jubail of the same size which it shares with France's Total.

Source: Reuters

August 3, 2013:

RICHMOND, Calif. (AP) - Richmond is suing Chevron for damages from a massive fire that shut down the energy giant's refinery at the San Francisco Bay area city last year. A lawsuit filed in Contra Costa County Superior Court Friday alleges the crude-oil pipeline leak that led to the Aug. 6 fire was the result of "years of neglect, lax oversight and corporate indifference to necessary safety inspection and repairs." The city is seeking unspecified damages, including compensation for emergency response to the fire, environmental cleanup and loss of property values. Chevron said in a statement that the lawsuit had no merit. Both Chevron and government investigations have determined that corrosion in a pipe caused a leak that sparked the fire, sending a plume of black smoke over nearby areas. Richmond Mayor Gayle McLaughlin said the City Council voted to sue after months of negotiations with Chevron failed to reach an agreement.

By The Associated Press

August 2, 2013:

Visakhapatnam:  The proposed 15 MMTPA refinery to be set up by HPCL in the Andhra Pradesh Special Economic Zone (APSEZ) in Visakhapatnam district is critical for the success of the Petroleum, Chemical, Petrochemical Investment Region (PCPIR) between Visakhapatnam and Kakinada, and the PCPIR Special Development Authority (SDA) is making all efforts to get the project going, according to N. Yuvaraj, Vice-Chairman of the Visakhapatnam Urban Development Authority and also of the PCPIR SDA.  Reviewing the progress of the PCPIR project at a press meet here on Friday, Yuvaraj said the draft master plan would be made public on August 5 and objections and suggestions would be invited. A public hearing would be conducted on the PCPIR next year, after completion of all studies. Yuvaraj further said the PCPIR was expected to attract investments in the region of Rs 3,00,000 crore till 2031, generating employment of 6,40,000. He said there were already several units in the PCPIR, such as the existing refinery of HPCL in Visakhapatnam with a capacity of 9 MMTPA. It would be scaled up to 15 MMTPA.

Two more refineries

“Two more oil refineries would come up in the region, one to be set up by HPCL in APSEZ in Visakhapatnam with a capacity of 15 MMTPA and another to be set up in the Kakinada Special Economic Zone (KSEZ) by the GMR Group with a similar capacity,” he said. “Petrochem units would also be set up along with the two refineries.” At 640 sq km, the PCPIR, covering 97 villages in the two districts of Visakhapatnam and East Godavari, would be the largest in the country, Yuvaraj pointed out. “We are taking all steps to protect the interests of the fishermen in the PCPIR and Rs 3,200 crore would be spent on rehabilitation and welfare of fishermen in the long run,” said.  Of this, Rs 300 crore would be spent immediately for the welfare of fishermen, on the construction of fishing jetties and provision of mechanised boats. In response to a query, he said the PCPIR would not cause any marine pollution that could lead to a fall in catches. Studies would be conducted and stipulations followed to curb marine pollution. There would be many effluent treatment plants in the PCPIR area, he said.

New expressway

As part of the project, Yuvaraj said, an expressway would come up between Gangavaram port in Visakhapatnam district and Kakinada port, a distance of 137 km, and the alignment had not been finalised yet. It would be linked to National Highway No. 5 and the state highways. In addition to the Visakhapatnam airport, another no-frills airport with a single runway would come up in the vicinity of Rapathi village near Kakinada, he said. Also, another port would come in the KSEZ area. He denied there would be any diversion of water meant for agriculture to the PCPIR. Water would be drawn from the Godavari through Polavaram canal. There would be no exploitation of groundwater in the PCPIR area, resulting in ingress of saline waters from the Bay of Bengal. He said the fishermen, farmers or other sections of the public in the PCPIR had nothing to fear. He also said there would not be any more land acquisition for the PCPIR project in the near future. The land was already available. In response to a question, he said HPCL was not reluctant to set up the refinery in APSEZ, but certain issues would have to be sorted out.

By The Hindu Business Line