Taiwanese private-sector refiner Formosa Petrochemical has cancelled and deferred August-loading gasoline cargoes after a fire hit its 540,000 b/d Mailiao refinery complex in mid-July.
The exact number of cargoes cancelled and deferred cannot be confirmed but at least one gasoline cargo that was supposed to load in August was cancelled, said market participants. About one Medium Range (MR) spot and one MR term cargo for August loading could have been deferred or cancelled but the exact details could not be confirmed, Formosa said.
The refiner has shut one of its 180,000 b/d crude distillation units (CDUs) but still has two 180,000 b/d CDUs running at about 80-90pc of capacity. Formosa also shut yesterday one of its gasoline-producing units, the 84,000 b/d residual fluid catalytic cracker (RFCC), but will ramp up its other 84,000 b/d RFCC to 90pc, it said.
The cancellation and deferments were not unexpected, said market participants. The fire broke out at a residual desulphurisation (RDS) unit at the refinery complex on 15 July, which cut the availability of low-sulphur feedstock for the gasoline-producing RFCC. The RDS unit typically prepares residue for further upgrading by adding hydrogen in the presence of a catalyst, removing sulphur and boosting refinery yields of liquid products. Low-sulphur residue can be used as feedstock for the RFCC after going through this treatment.
Formosa has been reducing its gasoline offerings this year because of weaker margins but the refinery disruptions will further reduce its gasoline offerings. It typically exports more than five MR gasoline cargoes each month but this will fall to about 1-2 such cargoes each month for August-December, Formosa said.
Taiwan's gasoline exports have already been falling. It exported about 78,500 b/d in 2018, 74,500 b/d in 2019 but an average of 51,500 b/d during January-May this year.
