The latest OGJ annual worldwide refining survey showed
a readjustment in global crude oil refining capacity for the
Year-on-year changes, however, continued to result largely from OGJ’s broadened data collection efforts to include
capacity data an individual operator has disclosed publicly
but did not voluntarily report to OGJ by the survey deadline.
While this year’s survey does include data captured via
OGJ’s more expansive collection methods, these independent data-gathering procedures are evolving on a continual
basis, particularly for regions such as Asia-Pacific, Eastern
Europe, the Middle East, and Africa, where capacity information on refinery processes downstream of crude distillation units remains difficult to obtain.
OGJ continues to evaluate additional approaches to enhanced, independent data discovery methods as part of an ongoing program to provide readers the latest operational data available on global
refineries whether or not reported by survey respondents.
Global refiners continued to announce capacity expansion projects during 2017, but heightened environmental regulatory regimes amid a sustained
lower crude oil price environment prompted many operators
to remain focused on improving efficiency, maximizing processing capabilities, and expanding integration of existing
While several previously and newly announced greenfield refining projects continued to advance by yearend, the
bulk of planned expansions involve units downstream of
primary crude processing, many of which are to involve upgrades aimed at optimizing performance and output of current units in lieu of adding fresh capacities.
Increasing industry consensus of a “lower forever” outlook regarding crude prices, however, continued to encourage consolidation, restructuring, and divestment efforts
globally by integrated and independent refiners alike.
During 2017, North American refiners continued to focus
on programs to optimize, integrate, and consolidate current
operations to maintain their global competitiveness.
In April, Marathon Petroleum Corp. let a contract to
Fluor Corp. to provide engineering and procurement (EP)
for a major reconfiguration project involving works at both
the 459,000-b/d Galveston Bay and 86,000-b/d Texas City
refineries in Texas City, Tex. (OGJ Online, Apr. 13, 2017).
Designed to improve operational efficiency, the reconfiguration project will enable the two refineries to achieve the US
Environmental Protection Agency’s updated Tier 3 gasoline
Fluor’s scope of work under the contract includes delivery
of EP for an unidentified new unit, modernization of several
existing units, as well as modifications to the utilities and
off sites to support scheduled process changes and refinery
The contract followed Marathon’s previously announced
South Texas Asset Repositioning (STAR) program, which
aims to enhance profitability and reliability by unifying the
Galveston Bay and Texas City refineries to form a fully integrated 585,000-b/d Texas refining complex (OGJ Online,
Marathon completed a first phase of the multiyear STAR
program in 2016 at the Galveston Bay refinery with a project
that increased conversion of residual oil into lighter products by 20,000 b/d. Scheduled to be fully completed in 2021,
the STAR program will in result in an integrated Galveston
Bay-Texas City refining complex (the Galveston Bay refinery)
equipped with the following capacities: crude distillation,
585,000 b/d; resid processing, 142,100 b/d; catalytic crack-ing-hydrocracking, 258,400 b/d; alkyation, 52,800 b/d; and
aromatics, 33,800 b/d.
Elsewhere in its system, Marathon let a long-term contract to Praxair Inc. to supply hydrogen to support an ultralow-sulfur diesel (ULSD) project at its 539,000-b/d refinery at Garyville, La. (OGJ Online, Jan. 23, 2017). Praxair
will deliver hydrogen through its existing pipeline network
in southeast Louisiana for the refinery’s ULSD project, which
is planned for 2018, the industrial gas supplier said.
Scheduled to be completed by yearend 2018, Marathon’s
proposed $120-million Garyville ULSD project—which
joins a series of other initiatives related to Marathon’s ongoing planned investment of about $475 million to enhance
margins across its entire refining system—intends to increase the refinery’s production of ULSD by 10,000 b/d.
In addition to the ULSD project, Marathon also has out-
Americas, African refiners maintain focus
on upgrading, integrating, consolidating assets