Continental Refining plans capacity expansion at Kentucky refinery

Continental Refining Co. is adding a crude unit and hydrotreater as part of the company’s strategy to expand operations and increase production of low-sulfur fuels at its 5,985-b/d refinery in Somerset, Ky.

While the crude unit will not alter the refinery’s overall nameplate crude-oil processing capacity, it will help to triple its ability to process transmix, a type of fuel produced when different fuels mix together in the fuel distribution system, Continental Refining said.

Because transmix is a more difficult fuel to process than other types and cannot be sold without additional processing, the crude until will further equip the refinery to prevent these fuel mixtures from creating bottlenecks in the fuel distribution system.

Due to be completed sometime in this year’s second quarter, installation of the crude unit follows a Mar. 17, 2014, announcement from Continental Refining that it had allocated a $2 million investment over an 18-month period for the addition of a Maxim Processing unit at the refinery to increase its transmix processing capacity.

Alongside the crude unit, Continental Refining said it also will build a 3,500-b/d distillate hydrotreater at the Somerset site, which will double the refinery’s current naphtha hydrotreating capacity for processing high-sulfur distillate to produce additional volumes of ultralow-sulfur diesel (ULSD).

Valued in the tens of millions of dollars, the new hydrotreater is scheduled for startup in this year’s fourth quarter, the company said.

Continental Refining’s expansion program at Somerset comes as part of the refinery’s effort to increase cleaner fuel supplies to its customers, according to Demetrios Haseotes, the company’s chief executive officer and president.

Increased production at the refinery will be supported by additional feedstock arriving via the South Kentucky Economic Development Park (SKED), a 72-car public railroad facility in Ferguson, Ky., built to promote rail service for area businesses, as well by Ohio River barge operations, which have been expanded to move product to the refinery.

Continental Refining also has leased marine terminal space at Citgo Petroleum Corp.’s Louisville, Ky., terminal to receive and store product to support expanded refinery operations, the company said.

The Somerset refinery previously completed upgrades to receive transmix for production of finished low-sulfur marine diesel in 2014, at which time Continental Refining said it would invest $60 million through 2019 on additional upgrades at the plant.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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