Refinery news roundup: Maintenance in Russia affects product supply

Heavy refinery maintenance in Russia has been affecting supply of both gasoline and diesel, which coupled with healthy demand has boosted prices.

As a result, Russia’s government could redirect some of the diesel export volumes in order to cover rising domestic demand, the energy ministry said. Demand had been boosted by spring agricultural works and as farmers are beginning to stock up ahead of the autumn harvest works, but also amid heavy internal traffic. On the supply side, availability has been curtailed by heavy spring maintenance, which started in April and will last into July.

With many long-haul travel destinations closed due to restrictions imposed to contain the spread of the coronavirus, Russians have been opting for domestic tourism, which has boosted demand for both gasoline and diesel.

Deputy prime minister Alexander Novak once again raised the possibility of enforcing an export ban on gasoline. In May, the government said it would not enforce the ban, which was prepared as a draft at the end of April and also included a ban on naphtha exports. At the time the government said stocks were sufficient to cover demand and that there was no need to implement such a measure.

Separately, President Vladimir Putin said he has ordered the Russian government to develop by Oct. 1 an emissions reduction plan up to 2050. Putin said that by July 2022 the government should have developed a regulatory framework to implement environmentally friendly projects in Russia that will provide companies with clear and understandable rules and criteria.

Russian officials discussed hydrogen development with Western companies during the St. Petersburg International Economic Forum, as the country aims to take a 20% share of the global hydrogen market. Russia is considering developing hydrogen projects based on nuclear, natural gas and renewables. Russia’s energy strategy envisages hydrogen exports of up to 7 million mt/year by 2035 and 33 million mt/year by 2050. Its state renewable energy program up to 2034 envisages increasing renewables in Russia’s energy mix to 4%-5%, up from 2% currently.

** In other news, Ukraine’s second-largest producer of gasoline and diesel fuel, Shebelinka GPP, which operates under the Shebel brand name, increased gas condensate processing in the first five months of the year by 5.5% year on year to 198,300 mt. “The output increased due to several factors,” Serhiy Fedorenko, commercial director at UkrGazVydobuvannia, said in a statement. “First of all, there is a threat of a shortage of imported supplies and the closure of some small illegal refineries.” The refinery processes mostly domestically produced gas condensate and produces gasoline and diesel fuel.

Ukraine aims to increase imports of gasoline from the EU and to boost domestic production to offset short supplies from Belarus.

Belarus is the main supplier of high-octane gasoline to Ukraine, and accounts for 50% of the market, suggesting that reduced supplies will have a major impact. Belarus is expected to reduce by 80% supplies of A-95 gasoline to Ukraine in June to 10,000 mt from 55,000 mt that has been normally supplied every month, according to an industry source.

** Poland’s largest refiner PKN Orlen said its Lithuanian refinery Orlen Lietuva has bought 100% of the shares of Lithuanian company Mockavos Terminalas, which owns a rail reloading terminal on the Polish-Lithuanian border. “The takeover of the rail reloading terminal in Mockava near the border with Poland, will not only increase security, but also improve logistics and guarantee stable fuel supplies to Poland and Ukraine,” PKN’s CEO Daniel Obajtek said in a statement. PKN did not disclose the acquisition price.

** Uzbekistan’s Jizzakh Petroleum has signed a memorandum of understanding for the financing of its new greenfield Methanol-to-Olefins plant in the Bukhara region of Uzbekistan. The MOU, signed at the St. Petersburg Economic Forum with Russia’s Gazprombank, the State Development Corporation and the Russian Agency for Export Credit and Investment Insurance, established a framework for the “potential future cooperation” regarding the financing of the project. The 720,000 mt/year complex is expected to process 1.5 Bcm/year of natural gas and produce high-quality polymers. It is slated for completion in 2024.

Near-term maintenance

New and revised entries

** Works at Ryazan and Yaroslavl in central Russia have been completed.

** Works at the Ufa and Novoil refineries from the Ufa refining hub and at the Novokuybishev refineries in the Samara refining hub have been completed.

** Russia’s Astrakhan refinery, which predominantly processes gas condensate and produces only light products, has extended its maintenance until September 10, according to a source close to the company. The plant started works in May.

** Russia’s Surgut gas condensate processing plant is expected to start works July 14 set to last until August 10.

** Russia’s Antipinsky refinery is resuming its sales of gasoline and diesel on Russia’s St. Petersburg exchange after works. The refinery has not been selling products over the last month due to planned maintenance.

** Kazakhstan’s Shymkent refinery is back after works. Units have been gradually restarting since early June. The refinery started planned maintenance May 6. Following its upgrade, the refinery has increased its turnaround cycle to once every three years. Its previous major maintenance was in 2018. Maintenance at the Shymkent refinery was deferred so the refinery could supply the market during the Atyrau turnaround. Shymkent, which was initially due to start maintenance in late March, subsequently deferred to April and then to May.

Existing entries

** Belarus’ Mozyr refinery is starting a major turnaround from June 1, the country’s Belta news agency reported citing the refinery.

** Russia’s Taneco refinery will carry out works in June, according to market sources. The maintenance is expected to last until late July and include both primary and secondary units.

** Russia’s Salavat is planning another partial maintenance in the autumn.

** Works at the Kyubishev refinery from the Samara refining hub are ongoing with works at Kuybishev expected to end in early July.

** Works at the Achinsk refinery have started May 12.

** Kazakhstan’s Atyrau refinery is expected to carry out a planned maintenance from mid-September to mid-October, according to media reports citing the energy ministry.

** Kazakhstan’s Pavlodar refinery will carry out works in August. The planned maintenance at the Pavlodar refinery has been moved from the spring in order to secure domestic supply.

** Russia’s Komsomolsk refinery deferred its planned maintenance so it does not coincide with the turnaround at the Khabarovsk refinery, according to the country’s Interfax news agency. No further details were reported. The refinery had planned works to start from April, S&P Global Platts has reported previously. The Khabarovsk refinery will carry out works from mid April for a month.

Upgrades

New and revised entries

** Russian oil company Lukoil launched a new isomerization unit at its refinery near Nizhny Novgorod, also known as Norsi and Kstovo. The unit has feedstock capacity of 800,000 mt annually and produces a high octane gasoline component. The new unit will allow the refinery to increase gasoline output by 400,000 mt/yr. The refinery is also completing the construction of a deep processing complex, the company said. It is due to be launched in the autumn and will allow the refinery to reduce fuel oil output by 2.6 million mt/yr and increase 10 ppm diesel output by 700,000 mt/yr. The refinery’s depth of processing will reach 97% and the light products yield 74%. As a result of the launch, Lukoil’s refineries’ fuel oil output will be less than 4% and light products yield 75%. The deep processing complex includes a 2.110 million mt/year delayed coker; a diesel and gasoline hydrotreater, with 1.5 million mt/yr capacity; a hydrogen unit, with 50,000 Nm3/hour capacity; a gas fractionation unit, with 425,000 mt/year capacity; and a sulfur unit, with 81,000 mt/year capacity, S&P Global Platts has reported previously.

** Gazprom Neft said it has chosen Tecnicas Reunidas for the building of a delayed coker at its Moscow refinery. Construction of the delayed coker, which is part of the deep processing complex, will be completed in 2025. The delayed coker will enable the refinery to increase production of motor fuel and start producing petroleum coke. The delayed coker has 2.4 million mt/year capacity. As part of the complex it will build a 2 million mt/year hydrocracker, also due for launch around 2025. The first unit to be completed will be a sulfur production unit in 2023. The launch of the complex will increase the depth of processing of the Moscow refinery to almost 100%. The Moscow refinery will complete its modernization by 2025, when as part of a third phase it will halt the production of fuel oil. Meanwhile,

Gazprom Neft said it had completed disassembling outdated units at the Moscow refinery, which have been replaced by the new Euro+ (Euro plus) complex. The Euro+ complex was launched in July 2020. Five units, including crude preparation, primary processing, secondary distillation and high octane gasoline, were set to be disassembled with the completion aimed for 2021. The process of disassembling started in December 2020.

Existing entries

** Russian oil company Tatneft’s Taneco refinery is building a second delayed coker with 2 million mt/year capacity, residue hydroconversion and diesel hydrodewaxing.

** Russia’s Salavat refinery plans to launch its new FCC in the second half of this year. Currently it is in testing stage. The FCC will have a feedstock capacity of 1.095 million mt/year.

** Russia’s Yanos refinery in Yaroslavl has started building a delayed coker complex. As a result it will fully halt fuel oil output. Its depth of processing will exceed 99% and light products yield — 70%. Construction is scheduled for completion in 2024. The complex will be built in two stages — initially a delayed coker will be built which will enable the processing of more than 3.4 million mt heavy fractions, followed by a naphtha hydrotreater and light gasoil coker. They will provide feedstock for gasoline and diesel.

** Russia’s Novoshakhtinsky refinery will launch its new gasoline complex in 2024. It aims to produce around 670,000-680,000 mt/yr. Construction will start in July 2021, according to local media reports. Separately, the refinery plans to launch in December 2024 a 1.8 million mt/yr diesel hydrotreater. At the end of 2026 it expects to launch a deep processing complex, which includes a hydrocracker and delayed coker. Following the completion of all upgrades the refinery will be able to produce up to 3.2 million mt/yr diesel, 400,000 mt petroleum coke.

** Russia’s Safmar Group continues with upgrades at the Afipsky and Orsk refineries, it said March 2021. At the start of March Safmar Group signed with the energy ministry investment agreements regarding the construction of deep processing units at the two plants. The Afipsky refinery is planning the construction of a 1.6 million mt/year delayed coker. In addition the agreement envisages an upgrade of the hydrocracker complex by expanding its capacity from 2.5 million mt/year to 3 million mt/year.

Separately, Safmar Group is reorganizing two of its refineries by merging the Krasnodar refinery to the Afipsky refinery in southern Russia. It aims to complete the process by the end of summer 2021 and will thereby retain the name Afipsky refinery. The Krasnodar refinery will specialize in primary processing and the Afipsky refinery in secondary processing.

** Safmar plans to build new deep processing complexes at the Orsk refinery. They include a 1.2 million mt/year delayed coker and a gasoline dewaxer with 600,000 mt/year capacity. It also plans an upgrade of the hydrocracker complex and the isomerization unit which would increase their productivity by more than 15%. The company has previously said that the hydrocracker is set for launch in Q3 2022. The refinery started building the delayed coker in Q3 2020 and plans completion in Q3 2023. Its depth of processing will increase from 76.7% to 98.1% by 2022-2023. Separately the refinery is building a new unit for hydrotreatment of distillate products from the delayed coker unit. The unit can also be used for hydrodesulfurization of diesel from the primary processing units.

** Gazprom Neft said that its Omsk refinery is preparing for the launch of the deep processing complex. Construction has been completed and testing is underway. The 2 million mt/year complex will enable the refinery to increase the depth of processing and regulate the yields of gasoline, jet fuel and lubricants feedstock. Separately, Omsk has started assembling equipment for the new diesel hydrotreater and dewaxer unit at its Omsk refinery, whose construction is due to be completed in 2021. The unit will have 2.5 million mt/year of feedstock capacity and will allow the refinery to replace two outdated units.

Separately, the company said recently it has started assembly of electricity equipment at the catalytic cracker at Omsk refinery as part of the unit’s upgrade which aims at increasing the output of high octane components. The company said previously it had completed installation of the upgraded L 35/11-600 catalytic reformer. Two new compressors have been installed and three have been upgraded. Work had been due for completion in 2020. Omsk has also completed the installation of its new delayed coker.

The 2 million mt/year unit will help halt fuel oil output, increase coke production and the depth of processing to 97% and light products yield to 80%. It will produce 38,700 mt/year of needle coke, which is used in the production of electrodes for the steel and aluminum industries. It is part of the deep processing complex at Omsk. The new delayed coker unit and upgrades to its existing coker are set to be completed in 2021. Omsk has also completed the installation of the main equipment at the primary CDU-VDU processing complex. The complex, with 8.4 million mt/year capacity, will be completed in 2021, and will allow the refinery to take six outdated units out of service. Separately, the refinery started a project to upgrade the AVT-10 primary processing complex, which has a capacity of 8.6 million mt/year.

The project is due to be completed by the end of 2021.

** Russia’s Ryazan started reconstruction of its primary processing unit AVT-2. The upgrade of the 2 million mt/year CDU will enable the refinery to reduce the output of high sulfur fuel oil and improve the refinery’s economics.

** Belarus’ Mozyr refinery is preparing for the gradual launch of its new hydrocracker H-Oil, the country’s Belta news agency said. The complex includes the hydrocracker, hydrogen and sulfur units. The completion of the hydrocracker H-Oil complex at Mozyr will cut fuel oil output and increase light products. The complex, with feedstock capacity of 3 million mt/year, will increase its light products yield to 70% and depth of processing to 90%. Socar subsidiary Socar Construction has completed the installation of a hydrocracking unit at the Mozyr Oil Refinery in Belarus, Azeri state news agency Azertac reported previously. Work on the project, which involved the installation of 13 km of pipelines, began in August 2019, the agency said adding that Socar Construction had also been contracted to install thermal insulation at the Mozyr oil refinery. The complex includes the hydrocracker, hydrogen and sulfur units. Separately, the delayed coker at Belarus Naftan is expected to be launched and produce its first batch of product by the end of this year, according to the Belta news agency. Previously the complex was expected to come online in 2020. Construction is expected to be completed in May, with operations in test mode starting shortly thereafter. Production is expected either at some point in Q4. In February 2020, the refinery started testing its new delayed coker, while construction works were ongoing, S&P Global Platts reported earlier. The new complex will enable the refinery to increase its depth of processing to 90% and the light products yield to 65% while decreasing the output of fuel oil, the report said. Upon its launch, the refinery will be able to fully cover the country’s gasoline (up to 1 million mt/year) and diesel (up to 3.4 million mt/year) demand.

** Russia’s Komsomolsk refinery has completed the upgrade of its primary processing complex ELOU AVT-2 (CDU-VDU) which enabled it to increase the light products yield and to increase the output of 0.5% low sulfur marine fuel. The refinery is planning next to upgrade the ELOU AVT-3 primary processing complex. Since the start of the year it has increased the output of gasoline by 20% compared with last year. Furthermore, the refinery is building a hydrocracker complex which will increase its depth of processing to over 92%. The complex has 3.5 million mt/year capacity.

** Russia’s Achinsk refinery will increase its depth of processing to over 95% and the light products yield to 88% upon completion of its upgrades, which will lead to the almost complete halt of fuel oil output. Currently it is building a hydrocracker with integrated hydrotreater. Its launch will enable it to almost double the output of motor fuel aimed at covering domestic demand predominantly in Siberia and the Far East. It is also building a delayed coker complex and has upgraded a diesel dewaxing and hydrodesulfurization unit.

** Russia’s Ilsky is planning to launch a new gasoline complex, including a 1.5 million mt/year CCR and isomerization units, around the second half of 2023 which will enable it to produce high-octane gasoline components and gasoline meeting Euro 5 standards, LPG and xylenes. After launching the gasoline complex, it aims to start building a diesel hydrotreater, with construction likely to be completed in 2024.

** Uzbekistan’s Bukhara will use Honeywell UOP technology to increase crude conversion and produce Euro-5 standard gasoline and diesel, S&P Global Platts has reported previously. Honeywell will provide “licensing and basic engineering design services” for a new naphtha hydrotreating, RFCC, SelectFining and Merox units. The existing diesel hydrotreater will be revamped. Uzbekneftegaz has decided to proceed with an upgrade of its Bukhara and Fergan refineries and put on hold building a new refinery in the Jizzakh region, it has said previously. Uzbekistan’s Fergan refinery between 2020-2023 aims to commission hydrocracking process in a staggered way which will allow it to produce Euro-5 regular gasoline 92 RON as well as diesel, according to the energy ministry. Currently modernization is ongoing at a number of units at the refinery, S&P Global Platts has reported previously.

** Renovation and rebuilding work on Azerbaijan’s Heydar Aliyev refinery is expected to be delayed by a planned one-month lockdown due to the COVID-19 pandemic, a Socar official told S&P Global Platts Dec. 8. The official said Azerbaijan will enter a full one month lockdown from Dec. 15 in an effort to reduce COVID-19 infection rates. The lockdown is expected to have an effect on ongoing work at both Heydar Aliyev and the adjacent Azerkimya petrochemical plant but that it was too early to say exactly how long any delay in completion will be. He did confirm that the pandemic has already affected work on both plants but was unable to confirm the length of delay expected before completion of work on the Heydar Aliyev refinery. Production of Euro 5 diesel and Euro-5 standard A-92/95/98 gasoline was originally planned by the end of 2021, and prior to that the end of 2020 for Euro-5 diesel and early 2021 for Euro-5 standard A-92/95/98. These dates were later pushed back to the start of 2022 due to the effects of the pandemic, with all work on the plant slated to be completed by 2025. The ongoing work includes replacing all the units of the refinery except one and in the process increasing the capacity to 7.5 million mt/year from 6 million mt/year. Work on the Azerkimya facility was previously slated to have been completed by the middle of this year. The official confirmed that work on the plant is expected be completed “soon”, but was unable to give an exact date due to the impending lockdown. The modernization of the plant, which is supplied with feedstock by the Heydar Aliyev refinery, will raise production from 60,000 mt/year previously to around 175,000 mt/year, although he cautioned that the exact output from the modernized plant will vary according to what products are being produced.

** Russia’s Rosneft is working towards launching the hydrocrackers that it has built at four of its refineries — Achinsk, Komsomolsk, Novokuybishev and Tuapse, Russian news agency Interfax reported.

Russia’s largest refiner is also completing the reconstruction of the hydrocracker at Ufaneftekhim, which was damaged in a fire in July 2016. State-controlled Rosneft is expanding the capacity of its existing delayed coker at Novokuybishev. Rosneft, Russia’s largest crude producer, plans to complete its refinery modernization program by 2025. The program includes construction and reconstruction of over 50 units, with work on more than 30 of the units having been finished.

** Kyrgyzneftegaz plans to upgrade its Jalal-Abad refinery. The company has issued a tender for development of feasibility study. Its strategy involves a unit for secondary processing of fuel oil.

** Russia’s Perm is working on a deep processing complex which will increase the refinery’s depth of processing. The project’s timeline is 2020-2025. The complex includes a catalytic cracker, diesel hydrotreater, hydrogen unit, alkylation unit.

** Kazakhstan’s Pavlodar refinery is looking to build a unit for the purification of LPG and has selected a Merox technology.

** The launch of four secondary units at the Mariisky refinery has been delayed, according to media reports. As per plans, after upgrades it expects to increase the AT-2’s capacity to 1.4 million mt/year from 900,000 mt/year and the VDU capacity to 1 million mt/year from 476,000 mt/year.

** The next stage of upgrades at the Antipinsky refinery in Russia involves increasing the capacity of crude and refined product pipelines. Antipinsky, which can process 9 million-9.5 million mt/year of crude, currently receives 7.5 million mt/year of crude.

** A delayed coker will be installed at the Turkmenbashi refining complex in Turkmenistan.

Launches

Existing entries

** Russia’s Rosneft could launch a planned new refinery as part of its VNHK (East petrochemical complex) in the Far East in 2029 and a petrochemical plant in 2026, according to media reports citing an energy ministry official. In August 2020, Rosneft CEO Igor Sechin told Russian President Vladimir Putin that Rosneft has shelved a plan to build a new refinery and petrochemical complex in the Far East due to changes in taxation, but can resume the project provided profitability can be guaranteed. Meanwhile, at a new meeting with Russia’s President Sechin said that one of the factors for carrying out the Far East project would be taking measures for stimulating the production of ethane and LPG. The Far East refinery is planned to process 12 million mt/yr of crude, while the petrochemical plant will have 3.4 million mt capacity. The production will include 1.8 million mt gasoline, 6.3 million mt diesel and 4.5 million petrochemical products annually.

** A new refinery is planned to be launched in Georgia, at the Black Sea port of Kulevi, in 2024, according to media reports. Construction of the 4 million mt/year plant is due to start in 2021, according to Fazis Oil, the reports said. The refinery is expected to have 98% depth of processing and produce Euro 5 and 6 gasoline and diesel and thus reduce Georgia’s import needs for oil products by 15%-20%.

** Russia’s Khabarovsk refinery plans to build a second phase to the plant close to the existing site, according to reports. The second phase would double the refinery’s capacity to 10 million mt/year, and aims to cover gasoline demand in the far east of Russia. The company is seeking an investor in the Asia-Pacific for the second phase, which includes an FCC, hydrotreater and delayed coker.
Source: Platts