Pemex fires

[briansue]

Fuel supplies in Mexico - something we need to keep an eye on?


Two Killer Refinery Fires No Help as Pemex Seeks New Partners


https://www.bloomberg.com/news/articles/2017-06-15/two-killer-refinery-fires-no-help-as-pemex-seeks-new-partners


June 15, 2017, 6:12 PM EDT June 16, 2017, 5:00 AM EDT


Fatal fires at two Pemex refineries over the past four months have come at a bad time.

Mexico’s state-owned oil company’s bid to recruit partners to help run their facilities "was already a tough sell" because of the condition of the aging plants, Tim Samples, a law professor and Mexican-energy analyst at the University of Georgia in Athens, said by telephone. "It has to make it even harder when the refinery you are trying to find a partner for is burning in the background."

Fire broke out at Pemex’s biggest refinery Wednesday following flooding rains from Tropical Storm Calvin, and then re-erupted on Thursday. At least one worker was killed in the blaze that shut down the 330,000 barrel crude capacity refinery at Salina Cruz.

That followed an explosion at the Salamanca plant on March 15 that left eight dead. Pemex refineries had as many as 88 unscheduled work stoppages last year, and four major maintenance plans were deferred.

Problems at Pemex’s refineries are long-standing. The company, formally known as Petroleos Mexicanos, estimates that maintenance issues and inefficiencies have brought annual losses at its refineries to about 100 billion pesos ($5.5 billion), adding to the company’s almost $100 billion debt. Pemex’s six refineries are operating at only about 60 percent of their capacity, processing 948,000 daily barrels of crude in the first quarter of the year.

Waiting Trucks
The accident at Salina Cruz, Mexico’s lone refinery on the Pacific side of the country, threatens gasoline supplies all along Mexico’s western coast. At 9 a.m. Thursday, a line of empty gasoline tanker trucks waited idly on the road outside the still-burning plant, where a thickening cloud of grey smoke billowed from the crude storage area.

One employee at the Salina Cruz refinery, who asked that his name not be used because he was not authorized to give public comments, said the accident was the worst he’d seen in years of working at the plant. The employee said he was worried about pollution from the fire, as rain falling at the plant had turned black Thursday, staining clothing and skin.

A Pemex spokesman confirmed in an email that rain was blackened by falling through the smoke rising from the plant.

Pemex hired Bank of America Corp. to help it seek joint ventures to improve operations and reconfigure its ailing refineries. Since disclosing those plans early last year, Pemex has repeatedly pushed back the expected date for the announcement of a partner.

Seeking Partners
The company wants to partner with private companies to revamp plants at Tula, Salamanca and Salina Cruz, said Carlos Murrieta, Director of Industrial Transformation, in an interview last November. The projects include construction of a new coker plant at Tula, its second-largest refinery.

In March, the company said Pemex would request formal bids from companies interested in the Tula coker project "in the next few weeks," though it has yet to announce plans for the public auction needed to award a contract. On a May 3 conference call, Murrieta said Pemex "expects to have a partner towards the end of the year, hopefully in the next three, four months" for the coker project, valued at $6.7 billion for its two phases.

Japanese trading company Mitsui & Co. and South Korea’s SK Engineering & Construction were identified earlier this year by Pemex as among companies it sees as potential partners for the Tula project, according to a spokesman who couldn’t be identified because of company policy.

"Our possible partners understand the nature of the hydrocarbons industry," Pemex said in an emailed response to questions about how the recent refinery accidents might affect interest from investors. "Pemex has implemented the most advanced security protocols in all of its installations to protect its personnel and installations at all times to guarantee a secure operation."

After Pemex’s fuel production sank in 2016 to the lowest level in 26 years, the company pledged to invest more in its refineries this year. Crude processing has rebounded following the completion of maintenance at the end of 2016 and improvement in prices for refined products, according to the company, which said processing could exceed 1.2 million daily barrels by the end of the year.

Outside the Salina Cruz plant Thursday, Ramon Londa, 38, a gasoline tanker truck driver, said he is concerned that if the gasoline supply runs out he will have to drive eight hours to Pajaritos, in the neighboring state of Veracruz, to fill up.

“The trucks are going in little by little, but there is a lot less supply right now,’’ he said.

MORE WEBSITE STORIES..


http://oilprice.com/Latest-Energy-News/World-News/Pemex-To-Restart-Mexicos-Biggest-Refinery-After-Major-Fire.html


http://www.reuters.com/article/us-mexico-pemex-refinery-idUSKBN1952QD


http://www.nasdaq.com/g00/article/fire-at-mexicos-salina-cruz-refinery-has-been-put-out-pemex-20170616-00343?i10c.referrer=https%3A%2F%2Fwww.google.com%2F

[briansue]

http://www.shell.us/about-us/projects-and-locations/deer-park-manufacturing-site/about-shell-deer-park.html


http://www.shell.us/about-us/projects-and-locations/deer-park-manufacturing-site/about-shell-deer-park/_jcr_content/par/tabbedcontent/tab/textimage.stream/1475540541538/a63757e53a378eec7954bc023e149279e07722ed30d22d985aee2f923d36b231/about-shell-deer-park-factsheet.pdf


DEER PARK REFINING L.P.

The refinery is among the largest in the U.S. with a crude oil capacity of 340,000 barrels a day. It operates as Deer
Park Refining Limited Partnership, a 50-50 joint venture formed in 1993 between Shell Oil Company and Petroleos
Mexicanos, or Pemex.

The refinery’s assets are managed and operated by Shell Oil Company through the Shell Deer Park Refining
Company. Since 1993, the Shell-Pemex partnership has made significant investments in refinery upgrades,
providing an increase in refining capacity and flexibility as well as increased opportunities to market a wide range
of oil products throughout North America.

Deer Park Refining L.P. processes predominantly sour crude oil, and Mexico imports more than half of the crude
oil processed. The site also processes crudes from Africa, South America, the U.S. and other countries. Products
made in the refinery include gasoline, aviation fuels, diesel fuels, ship fuel and petroleum coke.

Major processing units and facilities include:

SHELL DEER PARK FACT SHEET Updated on Oct. 3, 2016


? Distilling – There are two distilling or “crude” units at Shell Deer Park. These literally boil crude oil until it
vaporizes. The various hydrocarbons rise inside a column until they cool and become a liquid. The lightest
range of hydrocarbons are gases like propane and butane, the middle range includes gasoline, kerosene
and diesel fuel, and the heavier range hydrocarbons go into asphalt and other products.

? Fluid Catalytic Cracker – “Cat cracking” is a process that uses heat and circulating catalyst to make
gasoline.

? Selective Hydrocracker – This unit partially converts diesel-range material into gasoline, propane and
butane through a chemical reaction with high pressure hydrogen.

? Delayed Coker – This unit converts petroleum pitch into gas oils for processing in other units, which
ultimately produce gasoline, jet fuel and diesel fuel. The coker also generates petroleum coke, which
electric utilities use for power generation and cement companies use as a fuel source in kilns and in
gasification units.

? Catalytic Gasoline Hydrotreater – This enables the refinery to meet EPA regulations for low-sulfur
gasoline by reducing the sulfur content by more than 95 percent.

[MEXICOWANDERER]

Refer to Deerfield Park Texas

SHELL/PEMEX joint venture refinery. Crude comes in from Mexico. Tankered, Shipped and piped out finished products to Mexico.

The list of issues facing Petroleos Mexicanos is too long and boring to list. Government and labor has high pressure and high volume milking machines at the ready for any new retail petroleum refining venture.

[moisheh]

The Gov. should just give up on refineries. Just send it somewhere else to be refined. Big money loser. There is a reason no companies want to partner with Pemex. Maybe they could offer huge subsidies for a Foreign company to build some new refineries in Mexico. Maybe a PPP.

Moisheh

[qtla9111]

This is the map from Bloomberg that I had referred to earlier. It's from January of this year. I was surprised by the number of refinery fires around the world not just in Mexico. I know very little about the industry but 130 or so years later it still seems to be out of control.



In Mexico, apart from refinery problems are explosions and fires from clandestine pumping of gasoline from the pipelines which is sold on the black market in Mexico the U.S. and I am sure other nearby countries.

[MEXICOWANDERER]

Pemex is near bankrupt. It is intentional. To clear billion dollar a year dead wood from the skyscraper bureaucracy and do de-fang the utterly corrupt worker's union.

So all those big newspaper promises about desulfuring in Queretaro and Premium production in Salina Cruz turned out to be fantasmas. Ghosts.

Having eyes on the ground in the form of a pair of engineers who talk to cohorts revealed the truth of the matter since 2015.

A great majority of fuel is now imported and distributed by tankers and pipelines. The pitiful production at Reynosa for example can easily be offset by pipeline imports from Texas. It means using the pipeline a few extra hours each day.

So, a shortage will only effect for a day or two. Until a pig is run through a pipeline and product flows.

Mexico has sold a vast majority of asphaltic based pitch for far below market value on the world market. All to gain pennies on the dollar. This is why domestic asphalt pitch is so expensive and there are tens of millions of potholes on the roads.

It is so sad.

Refinery production at the moment is concentrating on number six fuel oil for CFE production and Diesel Marina.

Heavy ends refinery production reduces process burden by >80%. Running refineries at idle speed greatly reduces the chances of a unit upset. CFE does not have a requirement for fuel sulfur content and Diesel Marina is exempt from restraint.

With the avalanche of super light fracked product saturating the world market, the government seems to have written-off Pemex entirely. In short, the country is nearly out of crude oil and new production has been written off.

A fly-in-the-ointment is AMLO, the leading presidential (PRD) candidate. He could initiate reforms, but to upgrade the refineries is a tens of billions of dollars campaign. It would be cheaper to start from scratch and abandon existing process units.

The great "Gasolinaza" price increase and public furor that took place the first of the year was a money grab to fund vastly increased finished fuel imports. If I had to guess, at the moment Pemex is importing >65% of its comistibles. Probably closer to 80%. My eyesight is not good enough to see ships at anchor but I would bet a month's pension 90% of them have foreign produced product to be pumped ashore.

[briansue]

Not my intent to point any finger at anyone or anything - just a report on current situation with Mexico refineries. We have been hearing of upgrades for many years - no deaf ears here. As far as which or what countries experience oil disasters we might mention familiar names such as Deepwater Horizon and Exxon Valdez. There was also a huge refinery fire in Texas some years ago. I can't find any others. US oil companies now ship a lot of refined fuel to Mexico and plan to ship more as Mexico allows companies other than Pemex to open stations in Mexico. This was meant to advise any current travelers in Mexico that there could be shortages - don't go below a half tank before fueling up.

[qtla9111]

It's not just Mexico. There are refinery fires all over the world including the U.S. Japan and Asian countries are supporting the countries that are having distribution and production problems. It's not uncommon in the oil industry. Distillates are in big demand right now. There is a map that shows the current refinery fires around the world, I think it is a Bloomberg website that has it.

It's not just "poor ole Mexico", it's part of the industry.

[MEXICOWANDERER]

I tried to explain all this for the last year. It fell on deaf ears. Enjoy!