Curacao oil refinery resumes work after eight-month stoppage

MOSCOW (MRC) -- Curacao’s 335,000-barrel-per-day (bpd) Isla refinery has resumed work, management of the government-owned facility said, after eight months of paralysis caused by a dispute between its operator, Venezuela’s PDVSA, and US producer ConocoPhillips, reported Rueters.

Isla, which has been looking for a new operator to run the refinery beginning at the end of this year, restarted one of its crude distillation units and its thermal cracker, it said in a statement.

"Both units are producing gasoil and fuel oil," it added.

The plant suffered a fire early last year and fell idle after ConocoPhillips brought legal actions against PDVSA over a $2-billion arbitration award linked to the nationalization of Conoco’s projects in Venezuela. The US company got court orders temporarily seizing PDVSA’s cargoes and terminals across the Caribbean.

The parties reached a payment agreement in August. Conoco said seized assets would be released following the reception of the first installment, which was received in the fourth quarter

The long paralysis of the island facility, which is crucial for PDVSA’s crude blending, storage and shipping operations, spurred the government of the Caribbean island, which owns the refinery, to start a process to choose a new operator.

Houston-based Motiva Enterprises, a subsidiary of Saudi Aramco, was chosen in December as preferred bidder to operate the refinery, according to local media, but the government has yet to confirm the decision.
Isla’s management said the restart process took longer than expected due to its lengthy paralysis. The utility company providing power and other industrial services to the refinery also struggled to resume supply.

Isla declined to comment on the status of the bidding process.

As MRC informed before, Curacao’s Isla refinery is considering offers from 15 companies interested in temporarily operating the 335,000-barrel-per-day facility to replace the current operator, Venezuela’s ailing PDVSA state oil company, the refinery and the Curacao government said in a joint statement in late July 2018.
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US crude stocks fall less than expected, products build sharply

MOSCOW (MRC) - US crude oil stockpiles fell less than expected last week according to a largely bearish report from the Energy Information Administration, which also showed that gasoline and distillate inventories rose more than expected, reported Reuters.

Crude inventories fell by 1.7 million barrels in the week to Jan. 4, compared with analysts’ expectations in a Reuters poll for a decrease of 2.8 million barrels.

Distillate stockpiles, which include diesel and heating oil, rose 10.6 million barrels, more than five times the expected 1.9 million-barrel increase, the EIA data showed.

Gasoline stocks rose 8.1 million barrels, the largest weekly rise since December of 2016. Analysts had forecast a 3.4 million-barrel gain.

US Gulf Coast gasoline inventories rose to 89.4 million barrels, hitting fresh record highs, EIA data showed.

"The report is bearish given the smaller-than-expected decline in crude oil inventories and the very large increase in refined product inventories," said John Kilduff, a partner at Again Capital Management in New York.

"Refiners continue to operate at a high level, but they appear to be playing to increasingly empty theater, in that, demand and export levels continue to be lackluster, especially for gasoline."

Distillates may have seen lower demand due to warmer than normal temperatures.

"The milder temperatures have hurt distillate demand a little bit," said Phil Flynn, an analyst at Price Futures Group in Chicago.

Crude stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures rose 330,000 barrels, EIA said.

Refinery crude runs fell by 194,000 barrels per day, EIA data showed. Refinery utilization rates fell by 1.1 percentage point to 96.1 percent of total capacity.

Net US crude imports rose last week by 626,000 bpd while crude production was steady at 11.7 million bpd.
MRC

Major US Gulf Coast refiner awards engineering contract

MOSCOW (MRC) -- Primoris Services Corporation has announced a new engineering award valued over USD17 million with a major Gulf Coast refiner, as per Hydrocarbonprocessing.

The contract was secured by Primoris Design and Construction, part of the Power, Industrial, and Engineering segment.

The award is for detailed engineering and procurement services. The scope of work includes a new process unit, storage tanks, and interconnecting piping.

Engineering work on this project begins immediately, and completion is planned for the second quarter of 2020.

As MRC reported before, in H2 December 2018, Lyondell Basell Industries (LBI) restarted the large coker at its 263,776 barrel-per-day (bpd) Houston refinery. The 57,000 bpd coker was shut by a Nov. 28 fire that filled a heater with hard carbon deposits. The heater has to be cleaned before the unit can restart. The coker was shut for a four-week overhaul in October and November.
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Shell starts production at new petrochemicals unit in US Gulf Coast

MOSCOW (MRC) – Shell Chemical LP (Shell) announced the start of production of the fourth alpha olefins (AO) unit at its Geismar, Louisiana, USA chemical manufacturing site, said Hydrocarbonprocessing.

The 425,000-tonne-per-year capacity expansion brings total AO production at Geismar to more than 1.3 million tonnes per annum. Start-up operations began in December 2018.

Alpha olefins are key ingredients in many finished products that people use and enjoy every day, including laundry detergents, motor oils, and hand soaps.

"Our team delivered this world-class expansion project safely, on time and within budget," said Graham van’t Hoff, Executive Vice President for Shell’s global chemicals business. "This is a key growth project for Shell’s global chemicals business. Geismar will continue to play a leading role in providing the materials for products that an increasing number of people need and enjoy."

The new unit strengthens Shell’s leading position in the US Gulf Coast and illustrates the strategic value of its integrated downstream business. The Geismar site is supported with advantaged ethylene feedstock from Shell’s nearby Norco, Louisiana and Deer Park, Texas manufacturing sites, enabling the site to respond to market conditions.

The expansion project contains around 3,570 tonnes of steel, 18,290 meters of concrete and 85 linear kilometers of pipe. Several new pieces of infrastructure were built as part of the expansion, including a new water cooling tower, a significant expansion of the site’s rail loading capabilities, and the repurposing of a previously idled tank farm.
MRC

Engineering summit underway for Davis refinery

MOSCOW (MRC) -- Meridian Energy Group, Inc., the leading developer of innovative and environmentally-compliant oil refining facilities, has announced that the company and its engineering partners, Axens NA and McDermott International, have begun its first week of meetings to kick off the intensive effort to complete the Front-End Engineering and Design (FEED) of the Davis Refinery located in Belfield, North Dakota, according to Hydrocarbonprocessing.

Meridian announced just one month ago its signed agreement with McDermott International under which McDermott will finalize the FEED for the Davis Refinery. Following the completion of that FEED effort, the Parties will be prepared to enter into a comprehensive turnkey Engineering, Procurement and Construction (EPC). Agreement to build the Davis Refinery. Meridian has been working with Axens NA since 2016 to define the underlying proprietary process technology for the Davis Refinery unit operations and has entered into process book supply and license agreements with Axens this past September for the proprietary process units for the full 49,500 bpd Davis Refinery.

These meetings mark the full implementation of the integrated project partnerships that Meridian has assembled to develop the cleanest refineries on the planet. Axens NA provides a complete range of solutions to ensure the highest level of performance with a reduced environmental footprint, and McDermott is a premier, fully - integrated provider of technology, engineering and construction solutions to the energy industry.

William Prentice, CEO of Meridian, said of this Engineering Summit, "Meridian’s mission is to drive the reinvention of the refining industry, and the Davis Refinery is the future of domestic US refining. To fulfill this mission, Meridian requires Partners that share this vision, and possess the expertise and professionalism to complete Davis and follow-on projects in a reliable and cost-effective manner."

Meridian VP of Operations, Tom Johnson, also commented, "The entire Meridian, Axens, and MDR team is extremely excited to be a part of this innovative project. The team looks forward to delivering a completed oil refinery that meets the conditions of the EPA's approved Synthetic Minor Source Air Quality permit."

Meridian has completed and invested a significant portion of project financing and will continue to invest its own development financing for this next phase through completion of the FEED, as well as site preparation and grading at the Davis site as weather permits. Full project financing, as arranged by Meridian’s investment bankers, financial advisors, and placement agents, including CIBC, will close upon completion of the FEED, in time for full construction to resume later in 2019.

Lance Medlin, Meridian EVP of Projects had this to say, "The Davis Refinery is being designed as a cutting-edge facility, setting a new standard in how emerging energy needs are addressed at regional levels. Meridian’s partnership with McDermott and Axens NA for the engineering and development of the Davis Refinery is another step in what has consistently proven to be the right direction in refining."

Mark Fonda, EVP of Engineering for Meridian Energy Group, commented, "The Davis Refinery has the distinct advantage of being a greenfield, innovative, advanced technology project, which will be the most efficient, smartest, ultramodern refinery ever built. As such, the EPC effort will emphasize clean, efficient use of space, time and resources while maintaining the highest priority for environmental, health and safety compliance."

As MRC wrote earlier, in October 2018, Meridian Energy Group selected Axens as the technology provider for the final stages of basic engineering design for its 49,500 BPD Davis refining complex being constructed in Billings County, North Dakota. The project will utilize Axens’ Suite of clean fuels technologies to refine local Bakken tight oil and produce ultra-low sulfur transportation fuels while minimizing energy consumption and environmental footprint.
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