PdV refinery fire hits fuel supply: Correction

Corrects role of hydrotreater in second paragraph.

A key processing unit at Venezuelan state-owned PdV's 635,000 b/d Amuay refinery was destroyed in a fire late last week, undermining efforts to replenish fuel supply, oil ministry and PdV downstream officials told Argus.

The blaze destroyed over 70pc of the 85,000 b/d hydrotreater (HDAY3) that removes sulfur from vacuum gasoil, a feedstock used to make gasoline at the refinery's 104,000 b/d fluidized catalytic cracker (FCC). "The damage is irreparable and what's left of the unit will have to be dismantled and completely replaced," said a PdV official at the CRP complex, which is comprised of Amuay and the nearby 305,000 b/d Cardon refinery.

A senior oil ministry official in Caracas confirmed that firefighters did not extinguish the blaze in time to save the unit.

PdV is still investigating the cause of the fire and has not confirmed officially that the unit was affected.

The fire broke out shortly after lightning strikes overnight on 19 September caused a blackout on the Paraguana peninsula where the CRP is located.

The blackout also shut the 317MW Genevapca gas-fired thermal generation unit that supplies the CRP.

Amuay's FCC has operated below 50pc of its capacity since 2017 because of frequent processing unit breakdowns, and shortages of crude and VGO.

The destruction of the HDAY3 unit thwarts PdV's plan to expand Amuay's FCC output to about 80,000 b/d or roughly 77pc of its design capacity, the oil ministry said.

The HDAY3 plant had been inactive since 2017 but was restarted in mid-June 2019 using parts built on site to replace a broken gas-gathering component in a compressor.

PdV was forced to repair the unit using the old damaged parts as templates because of its financial problems compounded by US sanctions that limit access to spare equipment, the oil ministry said.

Amuay had been processing just under 130,000 b/d of crude or 20pc of its nameplate capacity before the power went out before dawn on 20 September. The destruction of the HDAY3 unit, which had been operating at about 50pc of its capacity, has reduced Amuay's operational capacity to about 60,000 b/d, a PdV official at the CRP complex said.

The Cardon refinery has been out of service since July.

The CRP complex accounts for just over 72pc of PdV's 1.3mn b/d domestic refining capacity.

Venezuela's domestic gasoline consumption as of 19 September averaged just under 80,000 b/d and diesel consumption about 60,000 b/d, compared with peak consumption of 300,000 b/d of gasoline and 190,000 b/d of diesel in 2014, the oil ministry said.

PdV's domestic refineries currently are not insured, according to the PdV downstream official who blames the lack of coverage on US sanctions.