London +4420 814 42225
Moscow +7495 543 9194
Kiev +38044 599 2950
info@mrcplast.com

Our Clients

Order Informer

 
Home > News >
 

Lukoil unit to remove crude stored at idled Come-by-Chance refinery

February 01/2021

MOSCOW (MRC) -- The trading unit of Russiaís Lukoil plans to remove crude oil it has stored at the idled Come-by-Chance refinery in Newfoundland, Canada, reported Reuters with reference to three sources familiar with the matter.

The Canadian refinery has been idled since last year, a casualty of coronavirus-induced demand destruction. Lukoilís Litasco unit is its primary crude supplier, and currently is storing between 2 and 3 million barrels of oil there that it plans on re-exporting to sell elsewhere, the sources said.

Numerous North American refineries have had to shut as coronavirus restrictions sapped fuel demand. The refinery, operated by North Atlantic Refinery Limited (NARL) and New York-based investment firm Silverpeak, has been closed since March, and is actively searching for a new owner.

Lukoil was not immediately available for comment. NARL declined to comment.

The crude supply deal NARL inked with Lukoil in 2016 is still in place for now, according to the sources. Lukoil also has an agreement to finance the products for sale at its retail units.

Lukoil had been storing its crude oil for free at the refinery while the market was in contango, where later-dated prices are higher than current ones. Now, though, current prices are higher, giving Lukoil the opportunity to sell the oil soon, the sources said.

Some of the oil could be shipped out as early as February, the sources said, adding that other options were also in consideration.

Earlier this month, the Canadian province Newfoundland and Labrador agreed to give NARL a total of CD16.6 million (USD13.05 million) to keep the 135,000 barrel-per-day plant idled as the owner seeks a new capital partner.

Come-by-Chance has been looking for a new owner after Irving Oil backed away from a purchase and share agreement in October.

As MRC informed earlier, Russian energy major Lukoil (Moscow) is studying several potential petrochemical projects in Russia and Bulgaria, with investment decisions expected to be made on two of them in 2021.

Thus, Lukoil announced an investment decision in June, 2019, to proceed with a 500,000-metric tons/year PP plant at its Kstovo refinery. In September this year it selected Lummus Technologyís Novolen PP technology and basic design engineering for the facilityís production unit. Kstovo is one of Lukoilís largest crude refineries in Russia with a throughput of 17 million metric tons/year, with the company recently adding a catalytic cracking unit that almost doubled the refineryís production of propylene feedstock to 300,000 metric tons/year.

At Budennovsk in Russiaís far south west, the companyís Stavrolen petchems complex currently has the capacity to produce 350,000 metric tons/year of ethylene, 300,000 metric tons of polyethylene (PE), 120,000 metric tons/year of PP, and 80,000 metric tons of benzene. Lukoil has for several years been considering construction of a new gas chemicals plant at Stavrolen to crack more ethane extracted from associated petroleum gas produced by its oil and gas fields in the north of the Caspian Sea. The potential new plant would raise Stavrolenís ethylene and PE output to around 600,000 metric tons/year each, and increase PP production to 200,000 metric tons/year.

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

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Lukoil is one of the leading vertically integrated oil companies in Russia. The main activities of the company include exploration and production of oil and gas, production and sale of petroleum products. Lukoil is the second largest privately-owned oil company in the world in terms of proven hydrocarbon reserves. Lukoil's production capacities include polyethylene polypropylene. The structure of Lukoil includes one of the largest petrochemical plant in Russia - Stavrolen.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, homopolymer PP, propylene, HDPE, ethylene, petrochemistry, Lukoyl, Stavrolen, Canada, Russia.
Category:General News
|
| More

Leave a comment

MRC help

 


 All News   News subscribe