Valero Adding More Hydrocracking Capacity Near Export Terminals
From RBN Energy today on Valero's plans to add more hydrocracker capacity down south:
We get the distinct feeling that there is not yet a sense of urgency
among refiners to address the apparent inconsistencies between their
refinery configurations, the available slate of crude and the product
mix that the market requires. Given the level of activity and investment
in drilling and infrastructure that we have seen in the past two years
to get crude to market as well as the flurry of new terminal storage
capacity and connections in refining centers, shouldn’t we be seeing
more signs of activity behind refinery gates?
Nevertheless, all the evidence suggests that US refiners in general
and Gulf Coast refiners in particular will have to make new investments
in their refineries to take full advantage of the new crudes coming
their way. If not in hydrocracker units - then in topping units that
increase their capability to process very light crudes or condensates.
Valero has determined that increased hydrocracking capacity is the way
to go and they have placed their bets accordingly. Now that the major
pipeline investments to redirect new crude flows to market are under
way, we believe the focus of industry investment will shift to
addressing refinery infrastructure issues. Given the slow start so far
on that investment we expect bottlenecks to shift from storage and
distribution centers to refinery gates.
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