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Largest 2022 refinery newbuild is officially ramping operations

Jun. 06, 2022 10:24 AM ETVLO, TTE, MPC, PSXBy: SA News Team54 Comments

Kuwait Flag and Towers

rjdek/iStock via Getty Images

  • Amid a global refining crunch, Kuwait has begun production at the first of three units in its newly built 615kb/d Al-Zour refinery; the complex is expected to fully ramp by year end.
  • The complex is

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Comments (54)

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No more refineries? global consumption is 100mbpd - US ref. capacity s/b around 15-18mbpd to cover local consumption + some for export or re-export. The rest the world refines about 75-80mbpd - unless economies go down, new or constant demand will be met by supplies / ref. in US or out. Cheers!
Doesn’t matter. The WEF is closing the spicket and gasoline will be $12 within 2 months. Intentional destruction of the West. Read the Great Reset. See https://stopworldcontrol.com/
@mjmair2323 Remember the WEF is mostly globalist homo's and government pull peddlers like China Joe Biden. They are not invincible and their plans will fail. Americans are not sheep and slugs like people in other countries. Who is John Galt?
Long Time Running profile picture
The former Husky oil Refinery in Superior Wisconsin that caught fire in 2018 (now owned by Cenovus) is being rebuilt and should be operational within a year.
rando_on_the_internet profile picture
The US hasn't built a new refinery since 1977. Clearly this is Biden's fault, never mind that we've had mostly Republican Presidents and mostly Republican Congresses and mostly Republican state legislatures for the last generation.
@rando_on_the_internet Under Biden many existing oil refineries were converted to biofuel refineries due to subsidies from environmental programs. Biofuel refineries have lower output than oil refineries, so these conversions lower total refining capacity.
@Joseph Hurst Those conversions started long before Biden took office. You can't switch them overnight.
rando_on_the_internet profile picture
Refineries are a necessary evil. Unless you think of East Houston or South LA as urban paradise, it's pretty easy to figure out why local officials won't permit new refineries. The sooner we get off fossil fuels and the sooner we can *legitimately* shut down refineries, the better. But that is still 15-20 years away, unfortunately.
Interesting news. Thanks SA.
secorewb profile picture
Instead of building it in the states with all the construction and operating jobs, let's import the final product.
PapaWhisky profile picture

That’s been our strategy since the ‘70s.

What could possibly go wrong?
Slade_01 profile picture
@secorewb That is funny and sad at the same time. Our refining capacity continues to fall as we convert medium size old refineries to biodiesel that cuts production dramatically. Case in point: California CVX Rodeo Refinery had 4.3 million gallon gasoline capacity before retrofit, now 8000 barrels a day biodiesel capacity.

As CVX CEO recently stated: we will never build another US refinery. The last was completed in 1977. Liberals need to start walking the talk and stop using evil gasoline and diesel.
@911Slade since the last refinery was built in 1977 it is obvious that Reagan,the two Bushes and Trump failed to build a single refinery! Seems to be a bipartisan nimby issue.
jodihn profile picture
@jacksalmon Here you go.
@jodihn Another great day for VLO and MPC. Every time I think about an exit strategy, they jump up to another level. I don't know what the hell to do, but I guess as long as the crack spreads stay wide open, there is no reason to cash in now.
@jacksalmon Yes Sir
jodihn profile picture
@jacksalmon A $140 handle on VLO - amazing. Now it will be you convincing me to hang-on. I had a 130-150 exit target but might increase the top side by $10. Could be a case where the only safe place right now is VLO as everything else is getting hosed. Think there will be a special dividend after this quarter?

Watching crack spreads and inventory numbers closer though as gas in MN increased $.30/gallon over the last 3 days from $4.49 to $4.79 for 87. Demand destruction will come in the not too distant future at prices this high when you couple it with the diesel cost impacts and cost of oil in all products consumed.

Who knows - maybe it all works out and $50-60 cracks stay for the duration but I am not betting on it.

Cheers and good luck
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