ExxonMobil is considering a $240mn project to widen the range of domestic crudes processed at its 502,500 b/d refinery in Baton Rouge, Louisiana, according to the state's governor.
The oil major did not comment on detailed plans, saying only that a "series of projects" would improve domestic crude processing and overall competitiveness. Louisiana governor John Bel Edwards said the company was evaluating projects to "improve processing capability, increase flexibility for meeting market demand, advance overall site competitiveness and install technology for a [voluntary] 10pc reduction of volatile organic compound emissions," pending final engineering and other decisions expected next year.
Complex refineries configured to run discounted heavy crude can struggle with the booming very light US crude production out of west Texas and midcontinent fields. Though easily processed, the light gases produced by the feedstocks may impair the overall efficiency of a refinery's crude units. Refiners including Valero have installed topping units or engineered other solutions to manage these lighter crudes and maintain overall processing efficiency at relatively low cost. ExxonMobil did not comment on its strategy.
Louisiana refineries bore the brunt of refinery idling and shutdowns this year as repeated major storms and comparatively poor access to North American crude added to the general downturn in global fuel demand. The state hosts nearly half of the 1.5mn b/d of North American capacity scheduled to be offline, either temporarily or permanently, by the end of 2020.
Downstream companies have shifted attention to sites with integrated fuels and chemicals production, as the chemicals business has proven more resilient this year. But the sector has also slashed spending and sought to sell assets. ExxonMobil targeted $16bn-19bn for spending next year, including a pause on downstream and chemicals projects.
The oil major broke ground in February on a polypropylene unit at the refining and chemicals complex. Senior vice president Jack Williams said in October that projects were "paused, but certainly not canceled." The company declined to comment on the status of a planned expansion at its 348,000 b/d refinery in Beaumont, Texas.
