Preem lets contract for Lysekil refinery

Swedish refiner Preem AB, a wholly owned subsidiary of Corral Petroleum Holdings AB, Stockholm, has let a contract to Amec Foster Wheeler (AFW) for the planned expansion of vacuum distillation capacity its 11 million-tonne/year refinery in Lysekil, Sweden.

AFW will deliver engineering, procurement, and construction management (EPCM) for a new vacuum distillation unit (VDU) at the refinery, the service provider said.

The VDU, which will be in addition the refinery’s existing 64,600-b/d VDU, will be used to boost the plant’s production of vacuum gas oil (VGO) in order to help reduce Preem’s need for imported volumes, AFW said.

While it revealed neither the value of the latest contract value nor the new unit’s proposed capacity, AFW confirmed it previously completed feasibility studies and front-end engineering design for the project in 2014 and 2015, respectively.

Alongside enabling reductions to Preem’s current VGO imports of about 50,000 cu m/month, the planned VDU expansion at Lysekil also will position the refinery to maximize its current crude capacity, as well as upgrade residual oil from the company’s 7 million-tpy Gothenburg refinery, the Swedish operator told investors in April 2015.

Preem said it expects to invest about 1.5 billion kronor (Swedish) for the VDU expansion, which is due to be completed by yearend 2018.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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