Daily Management Review

Exxon Gears Up With An Expansion Plan To Become A ‘Leader In The North American Refining Industry’


02/22/2018


Expansions plans are under Exxon’s sleeves as it inches towards “final approval”, reports sources familiar to the matter.



The Exxon Mobil Corp, reports Reuters, is moving close to sealing the “final approval” on the “major expansion” project of its “Beaumont, Texas, refinery”, whereby the said alteration could turn the company as the “largest crude processing plant” of the U.S., informed three sources familiar to the matter.
 
Since the year of 2014, the company has been considering to undertake an expansion. If the company gets a clearance, then it would boost the confidence of Exxon in the U.S. market for “shale production” as well as in matching the “global demand” of “gasoline and other fuels”. According to the spokesperson of Exxon, Sarah Nordin, the company is evaluating expansion of its “North American light crude refining”. However, final decisions are yet to be made, while she added:
“The Beaumont refinery is being considered as part of that evaluation”.
 
According to the C.E.O of Exxon, Darren Woods’ last month’s statement, the company has been considering an investment of “$50 billion” in the U.S. for a period of five years. Exxon has been looking into options of “putting in a third crude distillation unit (CDU) at the 362,300 barrel-per-day refinery”. However, in order to overtake the leading “Motiva Enterprises’ [MOTIV.UL] Port Arthur, Texas, plant”, which is currently the “largest” one, Exxon requires to expand into an additional area which could process around “300,000 bpd and 400,000 bpd”.
 
The primary refining of the crude takes place at CDU, which then produces “feedstock” for generating “gasoline, diesel and other products”. The “U.S. Energy Information Administration” informs that the “Port Arthur” refinery of Motiva has a capacity of processing around “635,000 bpd of crude oil”.
 
According to a source, who chose anonymity:
“They’re (Exxon Company) still crunching the numbers”.
 
Exxon hopes to expand its “Beaumont refinery” so as to take its total capacity of processes somewhere “between 700,000 and 850,000 bpd”. Amid the expectations of doubling oil production in the U.S. market, the expansion under consideration by Exxon could prove advantageous.
 
Information given by Nordin states that Exxon’s expansion plan could be executed “between 2019 and 2022” which is likely to take place in its “2,000-acre Beaumont site” along with “an adjoining chemical plant” located at the adjoining site for minimizing “environmental impact”.
 
If an approval is given to the said project, it would generate nearly “1,850 construction jobs”, as well as forty to sixty “permanent jobs” once the construction is completed. In Nordin’s words:
“The expanded unit would enhance the Beaumont refinery’s competitive position and establish it as a leader in the North American refining industry”.
 
 
 
References:
reuters.com







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