Pemex allocates $23 billion to downstream improvements

Mexico’s Petroleos Mexicanos (Pemex) said it will spend $23 billion on projects designed to modernize and reduce greenhouse gas emissions from the country’s six refineries.

Announced by Mexican President Enrique Pena Nieto during a Dec. 8 event held at the 315,000-b/d Miguel Hidalgo refinery in Tula, Hidalgo state, the investment program comes as a result of partnerships and alliances formed by Pemex with private and foreign investors following Mexico’s 2014 sweeping energy reform (OGJ Online, Aug. 21, 2014; Aug. 18, 2014), the state-run company confirmed in a release.

To boost production of ultralow-sulfur gasoline (ULSG), Pemex will invest a total of $3.1 billion in projects at all six of its refineries, which upon completion, will result in a final ULSG output of more than 210,000 b/d and reduce GHG emissions by 90%, the company said.

At the Miguel Hidalgo refinery, the ULSG investment consists of a $250 million project that includes installation of a 30,000-b/d desulfurization plant, an amine regenerator, a cooling tower, and ventilation systems for high-burning hydrocarbons and acid gas, as well as number of associated installations.

The company said it also will spend another $3.9 billion to build 19 plants and modernize 17 existing units at all six refineries as part of its previously announced plan to reduce the sulfur content of Mexico’s diesel production to help reduce the country’s need for imports.

Last year, Pemex planned an investment of only $2.8 billion into increasing ultralow-sulfur diesel (ULSD) production at just five of its refineries (OGJ Online, Sept. 15, 2014).

The ULSD project at the Tula refinery, which is scheduled to begin in January 2016, will cost an estimated $770 million, the company said.

In addition to its ULSG and ULSD investments, Pemex has dedicated another $13 billion to modernization and expansion projects at three of its refineries, including the Miguel Hidalgo refinery at Tula, the Antonio M. Amor refinery in Salamanca, Guanajuato, and the Antonio Dovalí Jaime refinery in Salina Cruz, Oaxaca.

At a revised total cost of $5 billion, the Tula expansion and reconfiguration will increase the refinery’s crude oil processing capacity by 25,000 b/d to 340,000 b/d (OGJ Online, Nov. 18, 2015), Pemex said.

The remaining $3 billion in planned investments will cover electricity cogeneration projects already under way at the company’s Tula and Salina Cruz refineries, the 275,000-b/d Hector R. Lara Sosa refining complex in Cadereyta, Nueva Leon, and the Cactus gas processing complex in Chiapas state.

Pemex said that, once completed, the $23 billion in downstream projects would enable a 7 million-tonne/year reduction in the Mexico’s carbon dioxide emissions.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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