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Preem drops USD1.65B Swedish refinery expansion plan

October 01/2020

MOSCOW (MRC) -- Preem announced it has scrapped plans for the expansion of Sweden’s biggest oil refinery that would potentially have created the country’s biggest polluter, blaming the economy, said Hydrocarbonprocessing.

The government had not yet decided whether to allow the planned USD1.65 billion (15 billion crown) expansion. A court ruled in June it could go ahead, running counter to the Social Democrats-Greens coalition’s promise to cut emissions.

"In light of the economic future prospects, Preem’s Board of Directors has decided that the environmental permit application for Preemraff Lysekil will be withdrawn, and that the ROCC (Residue Oil Conversion Complex) project will be discontinued,” Preem said.

It said the impact of the COVID-19 pandemic had contributed to the project no longer being commercially viable. “Dismantling the ROCC project is a commercial decision,” Magnus Heimburg, CEO at Preem since August, said in a statement. Climate activists and others had opposed the expansion.

Greenpeace this month in protest blocked a tanker from delivering crude oil to the refinery. It said the expansion would result in increasing carbon dioxide emissions by up to 1 MM tons per year, making it Sweden’s largest source of CO2 emissions.

Teen activist Greta Thunberg, who has said Sweden would fail to live up to its commitments to the Paris Agreement if it allowed the expansion, said on Twitter the news was “a huge victory for the climate and environmental movement”. Preem, owned by Ethiopian-born Saudi billionaire Mohammed Hussein al-Amoudi, is the largest refining company in Sweden. The group said it now instead planned to start production of renewable fuels at the Lysekil refinery.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, petrochemistry.
Category:General News
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