Irving Oil to Invest $204 Million in 300,000-Barrel-per-Day St. John Refinery Upgrade

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Researched by Industrial Info Resources (Sugar Land, Texas)--Irving Oil Limited (Saint John, New Brunswick) has announced plans to invest $204 million to refit the company's refinery at Saint John. Touted as one of the facility's largest upgrade and maintenance projects to date, the project is aimed at improving plant yield, as well as enabling the refinery to process heavy-grade crude and produce higher-grade fuels, such as ultra-low-sulfur gasoline, for markets in Atlantic Canada and the northeastern United States.

The project commenced earlier this month and will be executed over a period of 60 days. The scope of the refit includes work on the gasoline desulfurization and the residue fluidized catalytic cracking (FCC) units, with an investment of nearly $157 million to increase the efficiency and processing reliability of these units. The desulfurization unit produces ultra-low sulfur gasoline, while the residue FCC unit uses a catalyst under high pressure and temperature conditions to convert heavy oil into components for light fuels. The majority of the maintenance work will be undertaken on the desulfurization unit's filtering components and 6,000 feet of pipes. Irving Oil also will undertake general maintenance activities on other refinery units to reduce flaring and fugitive emissions. These include upgrades to two flare units, Crude Unit 3, an amine unit, and pipe racks.

The project will be implemented around the clock during the 60-day period until November, and the project workforce is expected to clock a total of 1 million working hours. The project will employ about 1,800 workers during its peak and generate nearly $185 million in economic spinoffs, such as accommodation and meals. About 400 to 500 personnel required for the project already are working at the refinery. About 75% of the remaining staff will be employed from New Brunswick, while the rest will be recruited from Western Canada.

The Saint John refinery is the largest in Canada, with a refining capacity of 300,000 barrels per day (BBL/d). It has a total FCC capacity of 95,000 BBL/d, including 75,000 BBL/d from the residue FCC unit and the remainder from another FCC unit fuelled by vacuum gas oil. The facility also has 92,000 BBL/d of hydrotreating, 35,000 BBL/d of catalytic reforming, and 34,000 BBL/d of hydrocracking capacities.

The refinery exports about 175,000 BBL/d of petroleum products, including 100,000 BBL/d of reformulated gasoline, to the northeastern U.S. This accounts for 42% of petroleum exports from Canada and about 45.5% of U.S. imports of reformulated gasoline. It is estimated that six out of 10 cars in Boston operate on gasoline supplied from the Saint John refinery.

However, the upgrade project has come under a lot of flak as it is expected to increase carbon emissions from the facility. Although company officials claim that the rise in carbon emissions would be less than 1%, clean air activist Gordon Dalzell contends that this still would have an adverse impact in the long run, more so since the refinery is located near a residential neighborhood. Dalzell also questioned the approval granted to the project by the Department of Environment of New Brunswick. In response, Energy Minister Jack Keir said that the government has a plan in place to tackle climate change issues and is on target for the same. Keir further said that the upgrade project will be favorable to the province in terms of investment and economic growth. Irving Oil is also implementing measures to minimize any odor, noise and site impacts arising from the project.

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