Saras eyes opportunities under Vitol ownership

Trading firm Vitol plans to run Italian refiner Saras' 300,000 b/d Sarroch refinery as a standalone business, separate from its other downstream assets, Saras chief executive Franco Balsamo said today at the firm's second-quarter results.

Vitol completed a deal to buy a controlling stake in Saras from the Moratti family in June. Under Italian law, the firm was then obliged to launch a takeover bid for the remaining shares.

"What Vitol intends to do is to work with us to develop the business to help us better understand the commodity markets, to create some new ideas in order to manage inventories. Saras is a complex refinery and what we are expecting is the contribution of Vitol can be a big opportunity for us to exploit all our capabilities," Balsamo said.

Saras expects refining margins to remain at current levels throughout the rest of the year, with chief operating officer Marco Schiavetti saying they will remain "above historical averages". The firm acknowledged that gasoline and diesel margins in the Mediterranean had recently come under pressure from new refining capacity. Nigeria's 650,000 b/d Dangote refinery began ramping up its crude intake in the second quarter, with cargoes of its light products reaching the Mediterranean.

Saras said Sarroch's run rate averaged 265,000 b/d in January-June, identical to Argus' assessment of throughput in the period. The refinery underwent work on its crude distillation capacity and an alkylation unit in the second quarter and will probably have some "minor maintenance" in the fourth quarter, Balsamo said. Saras now expects its throughput for 2024 to be in the range of 265,000-270,000 b/d, slightly lower than its forecast at the start of the year.

Saras swung to a profit of €31.3mn ($33.8mn) in the second quarter from a loss of €16.8mn in the same period last year. Significant maintenance work and a narrowing of heavy-light crude spreads weighed on the firm's profitability in the second quarter last year.

By Adam Porter