Resource development holding company Global Oil Management Group (GOMG) plans to restart part of the 335,000 b/d Isla refinery in Curacao to produce asphalt early next year.
GOMG intends to run 30,000 b/d of crude to produce asphalt, heavy naphtha and vacuum gasoil. It is yet unclear how much asphalt will be produced. The restart is expected to be complete by March.
The century-old Isla refinery and nearby 17.7mn bl Bullen Bay products terminal were previously run by Venezuelan state oil company PdV under a long-term lease that expired in late December 2019. The refinery may have produced as much as 250,000 bl/month of paving grade asphalt in the early 2000s, according to market participants.
By 2018, the refinery was barely operational because of a lack of feedstocks, maintenance and utility services. Some market participants are skeptical the refinery will restart before next summer, if at all.
Should the refinery restart, asphalt will likely flow to the US east coast and may displace some US Gulf coast exports to Latin and South America, potentially pressuring prices in both US regions.
From 2016-2019, the Isla refinery exported 208,600/metric tonnes of asphalt, according to data from Vortexa. Approximately 147,000t of those exports were sent to the US, with the majority headed to the US east coast ports.
The US east coast is short asphalt production, and PBF's 180,000 b/d facility in Paulsboro, New Jersey, is the sole producer in the region. Buyers on the US east coast typically rely on PBF's supply, railed asphalt from the US Midwest, or Canadian and Mediterranean imports.
Canadian refiner Irving Oil is also mulling a possible sale of its 320,000 b/d refinery in St John, Canada, further clouding the supply outlook for the US east coast.
Asphalt exports from Curacao would also compete with shipments from Colombia, which has also hiked exports in recent months. Colombia has exported 138,700t of asphalt so far this year, more than half of all of 2022's exports.
Curacao has tried several times to find an operator for the refinery since the expiry of PdV's license.
GOMG signed a partnership with Curacao's state holding company RdK on 9 June, and RdK said this agreement will not interfere with its search for an operator.
GOMG is owned and run by Harry Sargeant III and Harry Sargeant IV.
