Saturday, 30 August 2014

Petronas abruptly shuts secondary refining unit, say sources

Petronas is running the 100,000 barrels-per-day (bpd) Malacca refinery it jointly owns with US oil company Phillips 66 at a lower rate than usual after unexpectedly shutting a secondary unit.

The state-owned company shut a desulphuriser unit, which removes sulphur from oil products, due to a glitch, industry sources said today.

The refinery's crude distillation unit (CDU) will be running at a lower operating rate than normal from August 21 to September 8 while the secondary unit is being repaired, one of the sources said.

Petronas did not respond to requests for further information on the matter.

Petronas operates two CDUs at the Malacca petroleum complex that run as standalone operations. It solely owns a 100,000-bpd CDU that mainly processes sweet crude.

The CDU jointly owned by Petronas and Phillips 66 – now running at reduced rates – is designed to process sour crude with higher sulphur content.

Petronas entered the spot market this week to seek 300,000 barrels of diesel with 10 parts per million (ppm) sulphur for mid-September after buying two 500 ppm sulphur gasoil cargoes earlier, traders said.

The purchases are expected to support a regional market hit by ample supplies of middle distillates, especially from China, which has been increasing refining capacity, traders said. – Reuters