Saudi Aramco rejigs Q2 refinery works on local demand

LONDON - Middle East oil giant Saudi Aramco has re-worked its spring 2004 refinery maintenance programme to minimise overlapping outages in the second quarter amid strong local demand for oil products, industry sources said on Monday.

By (REUTERS)

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Published: Wed 7 Apr 2004, 12:06 PM

Last updated: Thu 2 Apr 2015, 11:35 AM

They said the original plan, with most turnarounds in a tight two-month period, was now replaced with one that stretched out over the entire three months in an effort to ease export disruption and cover roaring domestic demand for key products such as gasoline and diesel.

Aramco shut down its biggest domestic refinery - the 425,000 barrels per day Rabigh plant - as scheduled on March 24.

"The Rabigh plant is already down as per plans on March 24 and will be up in 20-25 days time," one source familiar with the refinery operations told Reuters.

Shipping market sources said several weeks ago that Saudi Arabia appeared to be loading as much as 14.5 million barrels of surplus crude in March, presumably barrels freed for export due to the turnaround.

Aramco has pushed back maintenance works for two other plants and included some secondary units.

It has now pencilled in the shutdown of the new 200,000 bpd Ras Tanura condensate splitter for about a month in May pending a contractors' report. The plant was originally due for maintenance in end March.

"The contractors are going to do a detailed survey of the new splitter and decide how long it will be down for. They are due to visit the site some time next week," the source said.

Industry sources said the delay will bring maintenance works on the new condensate splitter closer to its one-year start-up anniversary due in mid-August.

Aramco has also decided to close a couple of large units at the Ras Tanura refinery for maintenance works at the same time as the splitter. These units are likely to include a 44,000 bpd hydrocracker and a 40,000 bpd catalytic reformer.

Once maintenance works at these units are completed, probably in early June, Aramco will shut the 225,000 bpd wholly owned domestic Yanbu refinery for 25-30 days.

Traders said the change in Aramco's plans was due to unexpectedly strong domestic demand that had made it difficult for the oil giant to build up stocks while sustaining steady exports.

Aramco had told some of its term naphtha buyers in Asia last week that it would defer 100,000 tonnes of naphtha for loading in late-April to May. Sources said Aramco would defer two 25,000-tonne cargoes from Rabigh as well as two 25,000-tonne cargoes from Jubail.

They said the main reason for the naphtha shortfall was that Aramco has running all of its reformers flat out to meet surging domestic gasoline demand.

"Gasoline prices in the Middle East are steep and if they (Aramco) can get the stuff out of their own system than they would rather do that than import from the spot market," one dealer said. At the same time, differentials for gas oil are starting to edge up because of the limited amount of spot supplies coming out of Saudi. The Saudi Aramco shutdowns are the only major ones scheduled for the second quarter in the region. Details of Iranian refinery maintenance works were not immediately available. The only other confirmed major maintenance planned in the Middle East this year is a three-month long programme at the 250,000 bpd Sitra refinery in Bahrain.



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