PdV refinery restart hindered by feedstock gap

Spanish Market: Crude oil, Oil products
23/04/21

Venezuelan state-owned PdV is at odds to restart fuel production at the 190,000 b/d Puerto La Cruz refinery because of a competing need for limited light crude to blend with its Orinoco extra-heavy crude, according to managers and union officials at the site.

At stake is about 80,000 b/d of Mesa and Santa Barbara light grades needed to meet modest fuel production goals. But steady supply would sacrifice the feedstock needed to make 16°API Merey blend for export.

Earlier this month, PdV diverted some of the light crude as well as naphtha to its refineries in an effort to ease an acute fuel shortage. That contributed to a decline in Orinoco output to about 230,000 b/d in mid-April, compared with 350,000 b/d in March, according to upstream officials in Caracas and eastern Venezuela. This will have a knock-on effect on exports in April. A PdV marketing official in Caracas says it is "too early to make speculative estimates, but a possible contraction would be slight at worst."

PdV no longer produces enough light crude to simultaneously supply the refinery and its Jose upgrading and blending complex.

"The oil ministry will be forced to decide whether PdV will supply the national gasoline and diesel market or prioritize export growth based on Merey blend," an upstream official in Caracas said. "PdV cannot do both simultaneously."

Up to now, most of PdV's refinery repair efforts have focused on the 940,000 b/d CRP complex, which is operating at very low levels.

Some Puerto La Cruz units have been repaired and restarted, but the plant was shut down in 2017, following the collapse of a $9bn upgrade project with Asian partners. "Maintenance was mostly abandoned until December 2020," a union official added.

Equipment failures are a chronic problem as well. A refinery distillation unit was put into recirculation mode last month, and on 3 April it restarted gasoline production at its 15,000 b/d fluid catalytic cracker for the first time since 2017. But an 18 April power cut shut the refinery's processing units, followed by an explosion caused by a clogged pipe in the hydrotreatment unit.

Two distillation units and the hydrotreater were restarted yesterday, but the FCC is not expected to resume gasoline production until next week.

PdV regularly blames US sanctions for its refinery woes.

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28/11/24

Opec+ meeting delayed to 5 December

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US refiners cannot readily replace Canadian oil: AFPM

27/11/24

US refiners cannot readily replace Canadian oil: AFPM

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Traders expect Opec+ to delay output increase

26/11/24

Traders expect Opec+ to delay output increase

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Trump tariffs will divert TMX crude from USWC

26/11/24

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Norden agrees marine biodiesel deal with Meta

26/11/24

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