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Released April 08, 2016 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Planned spending on U.S. refinery turnarounds appears to be on the upswing this year, according to Industrial Info's project database. Turnaround activity for 2016 is estimated at $752 million, versus $677 million in 2015.
Click the image at right for a graph of U.S. refinery turnarounds since 2007.
Chris Paschall, Industrial Info's vice president of research for the Oil & Gas and Petroleum Refining Industries, predicted in January that spending on refinery turnarounds would be greater this year, even as the unit counts for scheduled turnarounds would be less. With 126 projects being tracked this year (including those that have already been initiated and completed in the first quarter), versus 137 in 2015, his prediction appears to be correct.
Last year, turnarounds were down sharply as refiners delayed projects to process the flood of inexpensive crude oil. For more information, see November 16, 2015, article - Refiners Chased Margins in 2015, but Maintenance Work to Grow in 2016 and 2017.
Gasoline margins are still positive, albeit weaker than several months ago, and some refiners have opted to delay turnaround work for another year, he said in January. However, spending on turnarounds "are larger and longer right now," he said. Indeed, the average cost of a turnaround among those projects tracked by Industrial Info is about $5.9 million for this year, versus $4.9 million in 2015.
The largest maintenance project being tracked by Industrial Info for this year has already been completed. Valero Energy Corporation (NYSE:VLO) (San Antonio, Texas) finished a $16 million turnaround project at its Benicia, California refinery on March 21. The 49-day project included the 77,000 barrel-per-day (BBL/d) fluid catalytic cracker unit (FCCU) and 20,000 BBL/d SF alkylation unit. Industrial Info is also tracking four U.S. turnarounds, each valued at $15 million, which will see completion later this year.
The U.S. Energy Information Administration said in a recent report that it did not expect U.S. refinery outages for the first half of 2016 to adversely affect the supply of gasoline, jet fuel and distillate fuel. In Petroleum Administration for Defense District (PADD) 1, which comprises the East Coast, "planned maintenance is very light for atmospheric crude distillate, fluidized catalytic cracking and reforming capacity in the first half of 2016," the report said. Planned maintenance in PADD 2 (the Midwest) is concentrated from March to May, the EIA said, with outage rates of crude distillation and reforming capacities close to the 10-year maximum level.
In PADD 3 (the Gulf Coast), planned maintenance of reforming, hydrocracking and coking units is intermittently above or close to the 10-year maximum, while planned maintenance for other units is near or below the 10-year average, according to the report.
Planned outages in PADD 4 (the Rocky Mountains region) are "moderate and concentrated in the period from February to April".
And in PADD 5 (the West Coast), planned outages between February and June will be higher than the 10-year average in coking capacities, and near or below the 10-year average in crude distillation, fluidized catalytic cracking, reforming, and hydrocracking capacities.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
Click the image at right for a graph of U.S. refinery turnarounds since 2007.Chris Paschall, Industrial Info's vice president of research for the Oil & Gas and Petroleum Refining Industries, predicted in January that spending on refinery turnarounds would be greater this year, even as the unit counts for scheduled turnarounds would be less. With 126 projects being tracked this year (including those that have already been initiated and completed in the first quarter), versus 137 in 2015, his prediction appears to be correct.
Last year, turnarounds were down sharply as refiners delayed projects to process the flood of inexpensive crude oil. For more information, see November 16, 2015, article - Refiners Chased Margins in 2015, but Maintenance Work to Grow in 2016 and 2017.
Gasoline margins are still positive, albeit weaker than several months ago, and some refiners have opted to delay turnaround work for another year, he said in January. However, spending on turnarounds "are larger and longer right now," he said. Indeed, the average cost of a turnaround among those projects tracked by Industrial Info is about $5.9 million for this year, versus $4.9 million in 2015.
The largest maintenance project being tracked by Industrial Info for this year has already been completed. Valero Energy Corporation (NYSE:VLO) (San Antonio, Texas) finished a $16 million turnaround project at its Benicia, California refinery on March 21. The 49-day project included the 77,000 barrel-per-day (BBL/d) fluid catalytic cracker unit (FCCU) and 20,000 BBL/d SF alkylation unit. Industrial Info is also tracking four U.S. turnarounds, each valued at $15 million, which will see completion later this year.
The U.S. Energy Information Administration said in a recent report that it did not expect U.S. refinery outages for the first half of 2016 to adversely affect the supply of gasoline, jet fuel and distillate fuel. In Petroleum Administration for Defense District (PADD) 1, which comprises the East Coast, "planned maintenance is very light for atmospheric crude distillate, fluidized catalytic cracking and reforming capacity in the first half of 2016," the report said. Planned maintenance in PADD 2 (the Midwest) is concentrated from March to May, the EIA said, with outage rates of crude distillation and reforming capacities close to the 10-year maximum level.
In PADD 3 (the Gulf Coast), planned maintenance of reforming, hydrocracking and coking units is intermittently above or close to the 10-year maximum, while planned maintenance for other units is near or below the 10-year average, according to the report.
Planned outages in PADD 4 (the Rocky Mountains region) are "moderate and concentrated in the period from February to April".
And in PADD 5 (the West Coast), planned outages between February and June will be higher than the 10-year average in coking capacities, and near or below the 10-year average in crude distillation, fluidized catalytic cracking, reforming, and hydrocracking capacities.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
