REFINERY NEWS ROUNDUP: More full or partial closures in Europe

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London —
More full or partial closures of refineries have been announced in Europe as ExxonMobil evaluates the conversion of its Slagen refinery in and a number of Spanish refineries are shutting units and laying off staff temporarily.

However, Essar Oil UK voiced confidence April 13 in the viability of the Stanlow oil refinery after reports of financial difficulty. It said it is increasing throughput on improving margins. Essar said Stanlow had been historically “very profitable” and while all refiners had suffered difficulties due to the pandemic, demand was now picking up and the company remained confident about the future. “We have successfully traded through a very difficult 12 months and are now seeing increased demand for road transport fuels and improving refining margins, which has resulted in increased throughput at the Stanlow Manufacturing Complex,” Essar said.

** ExxonMobil said it is evaluating the conversion of its Slagen refinery in Norway into a fuel import terminal. A consultation process has been initiated with employees and their representatives “as part of an extensive review of the long-term economic viability of the facility,” it said in a statement April 8. “The basis for and timing of a potential conversion will be subject to consultation with employees and dialog with the relevant authorities,” the company said in a statement. The refinery will remain in operation during the course of the conversion.

** Gunvor’s Rotterdam refinery has its two crude processing units, one in 2019 and the other one in 2020, and is developing new processes around hydrogen and co-processing of vegetable oil. The refinery in Antwerp is being mothballed with terminal activities continuing at the site. Future development opportunities are being assessed.

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** The strike at France’s Grandpuits refinery was called off in mid-February but only temporarily. In September, Total said it would convert the refinery into a and plastics recycling complex, ending crude refining at the site in early 2021. The refinery has been fully offline since late January. Total halted the crude distillation unit at Grandpuits Nov. 16 but the other units at the refinery had previously remained in operation.

** Eni is evaluating the conversion of its Livorno refinery in northwest Italy into a biorefinery, as part of the Italian company’s wider strategy to make its activities more environmentally sustainable, a company spokesperson said. Eni has already converted two of its Italian refineries and is looking to almost double its biorefining capacity to around 2 million mt/year by 2024, and expand this to at least five times by 2050, as part of its pledge to achieve complete carbon neutrality by 2050.

** Portugal’s Galp said in a regulatory filing Dec. 21 that it will discontinue refining operations at the Porto refinery from 2021 and concentrate its core refining activities and future developments at its larger Sines refinery. Galp said it will focus on enhancing the resilience and competitiveness of the Sines site, with a view to improving efficiency and to integrate the production of advanced biofuels and other cleaner as well as more valuable products. The Porto refinery, which came on stream in 1969, halted fuel production for a second time last year on Oct. 10 due to the impact of COVID-19 on fuel demand and high inventories. At present, the site will remain a logistics hub, but the company will assess other ways to use the facility. The company intends to shift its entire refining operations to the larger 220,000 b/d Sines refinery, where it has an FCC and a hydrocracker. The company said it expects the utilization rate at Sines to reach 90% in 2021.

** France’s Donges refinery is expected to restart in June, most likely around mid-June, a source at the CGT union said April 12. Total said Nov. 24 that it was to halt operations at Donges from Nov. 30 for the coming months due to weak margins, in the wake of the demand slump caused by the coronavirus pandemic. The refinery had been operating at a loss, it said.

** Petroineos said it was continuing consultations with employees, which started on Nov. 16, regarding a proposal to reconfigure the Grangemouth refinery in Scotland “to meet current and future anticipated demand” for fuels. The company proposes a smaller refining operation at Grangemouth and plans to mothball CDU1 and the FCC, two units that “have been closed throughout the pandemic due to significantly reduced local and international demand for fuels.”

** One of the two distillation units at Cepsa’s La Rabida is currently idled but set to quickly resume operations if demand improves. Fuel unit 1 and Vacuum Unit 2 have been offline since they concluded maintenance in Q4 2020.

** Croatia’s Rijeka refinery will optimize its operations from November “for a few months” and during that period will “perform regular technological activities at process units such as catalyst regeneration and preparation of these plants for the new processing cycle in 2021 through regular maintenance work.”

** Finland’s Neste said it had discontinued refining operations at its smaller Naantali refinery at the end of March. “Neste will continue port and distribution terminal operations in Naantali,” it said April 14. The company had previously announced plans to close Naantali by the end of March and develop the Porvoo refinery “towards co-processing renewable and circular raw materials.”

** Spain’s Bilbao had the smaller of its two CDUs offline since Nov. 20, 2020, and recently announced a temporary lay-off of one-third of its staff.

** Repsol said April 8 it will lay off up to 60% of the workforce, up to 618 workers, at its Puertollano refinery complex for up to six months citing weak demand. The company already halted the refinery’s crude distillation unit citing unfavorable market conditions on March 31. The lubricants and chemical units have remained operational with the chemical units due to carry out a regular turnaround in May.

** At A Coruna, Repsol intends to halt operations at its coker unit, with a capacity of 1.1 million mt/year, and vacuum unit 2, but keep other units in operation until a planned turnaround of the fuel units in May. The company is temporarily laying off 31% of its staff at the A Coruna refinery due to the unprecedented in , the company said April 8. The 212 layoffs are expected to last for a maximum of six months, it said in a statement.

** One of the two distillation units at Cepsa’s La Rabida is currently idled but set to quickly resume operations in case of demand improvement, with Cepsa continuing to adapt the refinery utilization ratio to current demand, the company said Jan. 14. Fuel unit 1 and Vacuum Unit 2 have been offline since they concluded their last maintenance in the fourth quarter.

** Germany’s Heide refinery will reduce its staff by 106 positions following “intensive and constructive negotiations” since the end of October, the refinery said Jan. 28. It said, however, it will be “well-positioned for the future” with the agreed downsizing and “by changing its model towards the future production of green hydrogen.”

** Shell has relaunched the sale of its Fredericia refinery in Denmark after suspending the sale in 2018.

Separately, Israel’s Bazan said that its refinery in Haifa operated at 80% in 2020, compared with 94% in 2019. Its utilization was 75% in Q4, down from 88% in the year-ago period. The refinery carried out planned partial maintenance in Q4 2019. The refinery processed 8.705 million mt of feedstock, including crude and heavy vacuum diesel in 2020, down from 10.307 million mt in 2019. The decrease in utilization “was mainly due to the adjustment of output as a result of the decrease in demand for distillates and the decline in refining margins due to the Covid-19 pandemic.” In 2020, the company reported a 15% decline in the sales volumes in Israel, “mainly due to the significant decrease in jet fuel sales,” which decreased by 66%, adding that it was subsequently “routinely adjusting its product mix”. Diesel sales dropped by 11% but there was “no significant change” in the gasoline sales. The company said that it “regularly examines the need to adjust production volumes and, as far as possible, its product mix, to match demand and market margins” adding that if necessary it “reduces the volume of gasoline imports, diverts certain sales from the domestic market to export markets, and adjusts its inventory levels.” In January and February 2021, the company reported 88% decrease in jet fuel sales, 11% in diesel and 24% in gasoline, “partly due to the country going into the third shutdown.” Overall its sales were 25% down in the first two months of the year. The refinery does not plan any maintenance for 2021.

** Polish refiner Grupa Lotos ran its refinery at a 94.7% utilization rate in the fourth quarter of 2020 despite significant pressure on its refining margin, with sales of refined products in the quarter down by just 3.2% year on year to 2.687 million mt, it said April 6. The company’s seaside location enabled it to take advantage of attractive Q4 prices and increase maritime export sales, “which helped it maintain a high level of crude throughput and enhance the refining margin during the toughest period for the industry.” Lotos said the company was unable to maximize the effects of its EFRA modernization program as an “unusual and unexpected” impact of COVID restrictions was a narrowing of diesel and heavy fuel oil crack spreads. In Q4, Lotos carried out small-scale refinery investments. The most advanced was a hydrogen recovery unit to increase the share of hydrogen, LPG and naphtha in the refinery’s yields, with test runs at up to 60% of the unit’s capacity launched. The unit’s commissioning was postponed to Q1 this year, pending regulatory approvals. Lotos said maintenance shutdowns would cause a 5% drop in crude throughput in 2021.

** Galp said April 12 that crude throughput at its Portuguese refineries fell 26% year on year to 19.7 million barrels of oil equivalent in the first quarter of 2021 after it halted operations at the smaller Matosinhos complex due to weak demand amid pandemic restrictions. Throughput was down 16% from Q4 2020, the company said. Matosinhos was taken offline Oct. 10 and Galp said Dec. 21 it would discontinue its refining operations there from 2021 to concentrate activities at the larger Sines refinery.

** Meanwhile, oil product supply from storage facilities to the Spanish retail market were 19% lower year on year in the first quarter as jet fuel volumes remained weak amid ongoing travel restrictions, data published April 7 by national fuel distributor Exolum (formerly Compania Logistica de Hidrocarburos) showed.

NEW AND ONGOING MAINTENANCE:

Refinery

Capacity

Country

Owner

Unit

Duration

Sannazzaro

190,000

Italy

Eni

EST

2020

Castellon

110,000

Spain

BP

part

2020/2021

Gonfreville

247,000

France

Total

part

Dec’19

Leuna

230,000

Germany

Total

full

Q2 2021

Tenerife

90,000

Spain

Cepsa

offline

Since 2014

Bilbao

220,000

Spain

Repsol

part

Jan

La Rabida

220,000

Spain

Cepsa

part

Oct

Rijeka

90,000

Croatia

INA

full

Nov

Milazzo

200,000

Italy

Joint

part

Jan

Pembroke

270,000

UK

Valero

full

Back

Pernis

404,000

Netherlands

Shell

part

Feb

Miro

310,000

Germany

Joint

full

Back

Gdansk

210,000

Poland

Lotos

part

Mar

Botlek

190,000

Netherlands

ExxonMobil

full

Mar

Sarroch

300,000

Italy

Saras

part

Mar

Sines

220,000

Portugal

Galp

part

Mar

Bratislava

122,000

Slovakia

MOL

part

2020

Duna

165,000

Hungary

MOL

part

2020

FUTURE MAINTENANCE:

Lavera

210,000

France

Petroineos

part

Sep

Burgas

190,000

Bulgaria

Lukoil

full

2021

Petrobrazi

90,000

Romania

OMV

full

2022

Gothenburg

125,000

Sweden

Preem

full

2021

Puertollano

150,000

Spain

Repsol

part

2020

Gdansk

210,000

Poland

Lotos

full

2022

Holborn

105,000

Germany

Oilinvest

full

2023

Sarpom

180,000

Italy

Joint

full

2021

Porvoo

250,000

Finland

Neste Oil

full

2021

Petromidia

114,000

Romania

Rompetrol

full

2024

Litvinov

108,000

Czech

Unipetrol

full

2024

Feyzin

109,000

France

Total

mothball

2021

Burghausen

76,000

Germany

OMV

part

2022

Ingolstadt

110,000

Germany

Gunvor

part

2022

Near-term maintenance

New and revised entries

** Germany’s Mineraloelraffinerie Oberrhein (Miro) was restarting units after planned maintenance, it said April 7. The restart began on April 1. The refinery was expected to ramp up throughput in April as the turnaround was coming to an end. The plant carried out a planned turnaround, starting in mid-February and lasting six weeks until the end of March. It included an upgrade aimed at increasing the conversion capacity for maximizing the output of gasoline and diesel. The maintenance was the largest in the refinery’s , it said. Around two-thirds of the facilities were halted for major inspection, including 41 units in Plant 1 and three units in Plant 2. Last year, the refinery said it was planning a major maintenance in 2021. It said at the time it would invest Eur300 million ($333 million), with two-thirds in new projects and one-third for upgrading existing units during the turnaround.

** UK’s Pembroke refinery was gradually completing planned maintenance in early April, according to market sources. The works, which started in early February, were set to last until April. Local media reported that flaring was expected over the weekend as the refinery was starting up. A spokesman told Western Telegraph that the flaring would occur as units start up after routine maintenance. Last year, the company said that in Q2 it carried out works on the FCC at Pembroke, with the works having been originally planned as part of the 2021 turnaround.

** France’s Donges refinery is expected to restart in June, most likely around mid-June, a source at the CGT union said April 12. Total said Nov. 24 that it was to halt operations at Donges from Nov. 30 for the coming months due to weak margins, in the wake of the demand slump caused by the coronavirus pandemic. The refinery had been operating at a loss, it said.

** The Milazzo refinery located on the Southern Italian island of Sicily was running maintenance works on its LC Finer unit, which was offline, as well as on other units as part of wide-scale upgradation at the plant, a source close to the refinery told S&P Global Platts. The maintenance and upgrade works started in the first quarter of 2021, though no information was available on how long they would last. There also was no information available on which units aside from the LC Finer were involved in the works, or if and how production output was affected. The maintenance was originally scheduled for 2019 and postponed various times.

Existing entries

** Spain’s Petronor halted its number 2 crude distillation at Bilbao on Nov. 20, 2020 in reaction to weaker market conditions. The halt has affected 40% of the refinery’s crude distillation and includes the visbreaking unit. The company also took a boiler offline in plant 3 on March 28, without specifying the length of the work. Plant 3 is where most of the conversion units are located. The boiler has previously been taken offline between March 15-24.

** The maintenance at ExxonMobil’s Rotterdam refinery, which started in March, has been extended into April, according to market sources.

** France’s Gonfreville refinery will be halting its base oil production facility due to structurally low demand, the company said March 2021. The base oil unit has been shut since December 2019 following a fire at the crude unit, a CGT union source said. Its restart would have required a major overhaul. The crude distillation unit, which was damaged after the fire at the pump feeding crude oil, remains offline. It is due to restart in May, according to CGT union sources.

** Shell’s Pernis refinery in the Netherlands said that works on one of its units will last until late May. The works on the unidentified unit started in late March. The refinery performed works on another unit in February and March.

** Finland’s Porvoo refinery is preparing for a “major turnaround starting in April,” the company said March 31. The maintenance will last approximately 12 weeks. It is carried out approximately every five years. The shutdown of the units will begin in stages on April 5. The refinery is expected to be back to normal operations by the end of June. The company plans total investment around Eur 330 million in the turnaround. Platts reported previously that the turnaround, which has been scheduled for Q2, would start in April, citing trading sources. The maintenance was originally planned for last year but was deferred due to Covid-19 with only the “most critical works” completed in the spring of 2020. The Neste harbor and distribution terminal at Porvoo will be operating normally during the turnaround.

** Poland’s second largest refiner Grupa Lotos said that it will partially shut its Gdansk refinery Feb. 26 to perform scheduled maintenance. “For the first time the maintenance project will be performed in the form of a partial shutdown (its second part will take place in spring 2022). In accordance with the plans, the shutdown in 2021 will not involve a stoppage of the entire refinery,” the company said in a statement. Lotos said the refinery will continue to process crude oil and dispatch products throughout the maintenance period, which will be completed on May 1. Lotos said 19 of the refinery’s more than 60 units will be shut in 2021, most of which will resume operation in early April. The last work will be performed on “three systems of the oil unit,” starting April 7. Lotos said the maintenance will reduce the refinery’s throughput capacity in 2021 by an estimated 5%.

** Italy’s Sarroch refinery is undergoing partial works, according to market sources. The company declined to comment but in its latest financial report in November 2020 said that it would lower maintenance costs over the next two years as all but essential upgrades are delayed beyond 2022.

** The FCC unit at Portugal’s Sines refinery is offline, which would reduce VGO imports, according to market sources.

** Hungary’s MOL is planning a “more intense” maintenance schedule in 2021 than it carried out in 2020, the company said. That will include ongoing works at the Rijeka refinery that started in November, as well as smaller shutdowns of various units at the Bratislava and Danube refineries up to September.

Rijeka has previously said it would be optimizing its operations from November “for a few months” and during that period will “perform regular technological activities at process units such as catalyst regeneration and preparation of these plants for the new processing cycle in 2021 through regular maintenance work.” ** API’s refinery in the Italian coastal town of Falconara Marittima is fully operational after routine maintenance and upgrades have been completed, sources said in late February.

The plant has been offline since mid-January when the works started, though it has still been shipping refined products from storage via trucks, as well as refined products coming in via sea routes to the complex.

** All units at France’s Grandpuits refinery are now fully offline as a result of a strike which has meanwhile been called off. Total halted the crude distillation unit at Grandpuits Nov. 16 but the other units at the refinery had remained in operation. All units are now halted and product deliveries have also stopped. Work to prepare the dismantling of the refinery has been halted.

** General maintenance at Germany’s Leuna will be carried out in May and June 2021, the company said. The maintenance and an upgrade had been scheduled originally for last autumn but have been postponed “due to the ongoing pandemic and the resulting restrictions on travel and transport of goods, as well as the impact on international supply chains”, the company said previously. The maintenance had previously been planned to take place over six weeks. Total said in 2019 it would invest Eur150 million ($166 million) in the Leuna refinery over 2020-21 to reduce production of heavy products as demand decreases, and increase production of methanol, a key feedstock for the chemical industry. The project will deepen the integration of refining and petrochemical operations and increase the competitiveness of the plant, Total said at the time.

** One of the two distillation units at Cepsa’s La Rabida is currently idled but set to quickly resume operations in case of demand improvement, with Cepsa continuing to adapt the refinery utilization ratio to current demand, the company said Jan. 14. Fuel unit 1 and and Vacuum Unit 2 have been offline since they concluded their last maintenance in the fourth quarter.

** Two planned maintenances at the Castellon refinery is eastern Spain have been pushed back, with no fixed date for when they will now go ahead. The first was previously scheduled for May and to last two to three weeks, affecting two distillation units, the powerformer 1 and the HVN. A second maintenance, initially due for November for two to three weeks, affecting one conversion unit (treatment plant) and the 1.4 million mt/year coker, has been pushed back into 2021.

** Eni’s Sannazzaro de Burgondi refinery in northern Italy started another cycle of maintenance and upgrade works, even as a decision on when to reactivate its Eni slurry (EST) unit, which has been offline since a 2016 fire, is still outstanding. The works being carried out are not the series of works planned for the EST unit that had previously been suspended.

** The Canary Islands’ only refinery on Tenerife will be permanently closed in the long term. There has been no production since 2014. Cepsa will install some logistics and storage facilities at the site, amid a wider regeneration project.

Future

Existing entries

** Gunvor Group said that its Ingolstadt refinery in Germany will undertake projects focused on heating systems and exchangers “to continue improving its energy efficiency and reduce its emissions.” A planned turnaround in 2023 will allow additional reductions, by carrying out projects on the FCC.

** Poland’s second largest refiner Grupa Lotos will carry the second part of the maintenance at its Gdansk refinery in the spring of 2022.

** Lukoil’s Neftochim refinery in Burgas, Bulgaria, which had scheduled out major works for this year, has postponed them, according to sources close to the matter. The refinery typically carries out works in February and March but has deferred them to later in 2021, possibly during the second half of the year. The works are expected to include atmospheric vacuum unit 1, atmospheric vacuum unit 2, atmospheric vacuum distillation 2, FCC, hydrotreatment, hydrocracker, according to company tender documents.

** France’s Lavera refinery is planning works at its FCC unit in September.

** Austria’s OMV said it will expand and modernize the cracker units and petrochemical cold section at its Burghausen refinery in Germany with the upgraded units planned to go live in Q3 2022, following a planned turnaround of the refinery.

** Czech Unipetrol said that following the turnaround at its Litvinov plant in Q2’20 the refinery has prepared production for a new four-year cycle. Thus the next turnaround is due in 2024.

** With its 2020 maintenance, Romania’s Petromidia and the petrochemical division “will align with the new operating strategy, with a general turnaround scheduled for 4 years and technological shutdowns scheduled for 2 years,” the company said.

** Two months of maintenance at the Sarpom refinery in Trecate, Italy, originally scheduled for October 2019 have been pushed back to 2021. Details on which units at the refinery will be upgraded as part of the maintenance — of the kind needed every 3-4 years — had yet to emerge.

** The Holborn refinery near Hamburg, northern Germany, plans its next turnaround in 2023. Its previous maintenance was in the autumn of 2018. The refinery carries out major works every five years.

** The next major turnaround at Preem’s Gothenburg refinery in Sweden will be in 2021.

** Romania’s Petrobrazi will undergo its next big turnaround in 2022.

** Total’s Feyzin is considering mothballing a visbreaker unit around 2021 as demand for heavy fuel is gradually declining and the unit works on average no more than three days a month. As a result of the mothballing seven people would lose their jobs, but would be offered other jobs within the organization, the company said.

Author

Elza Turner

Editor

Kshitiz Goliya

Commodity

Oil

Source: Platts

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