Citgo advances restart plans for idled Aruban refinery

Citgo Petroleum Corp., an indirect wholly owned subsidiary of Petroleos de Venezuela SA (PDVSA), and the government of Aruba are moving forward with a previously announced program to restart Valero Energy Corp.'s former 235,000-b/d refinery in San Nicolas, Aruba (OGJ, May 28, 2012, p. 22).

Authorities from the governments of Aruba and Venezuela, as well as officials from PDVSA, Citgo, and Citgo Aruba, held a ceremony on Oct. 7 to launch the kick-off of activities that will lead to the refinery’s full restart by yearend 2018, Citgo said.

Details regarding specific construction activities under way at the refinery, however, were not disclosed.

The recent ceremony follows a June agreement between the parties under which Citgo Aruba committed an investment of $450-650 million to transform the refinery into a plant designed exclusively to upgrade Venezuelan extra-heavy crude oil production (OGJ Online, June 13, 2016).

Following the planned 18-24-month overhaul and revamp of existing processing units at the site, the refinery will have a capacity to upgrade 209,000 b/d of extra-heavy crude from Venezuela’s Orinoco heavy oil belt into intermediate crude feedstock that will be shipped to Citgo’s US refineries for further processing.

Naphtha recovered at the plant, in turn, will be sold to PDVSA for use as diluent.

Citgo Aruba will operate the San Nicolas refinery—which is now owned by the Aruban government—under a 15-year lease agreement with a 10-year extension option.

Citgo operates three US refineries, including a 425,000-b/d manufacturing complex in Lake Charles, La.; a 157,000-b/d refinery in Corpus Christi, Tex.; and a 167,000-b/d refinery in Lemont, Ill.

Alongside supporting PDVSA’s program to increase production from Orinoco belt (OGJ Online, Sept. 23, 2016), restart of the San Nicolas also paves the way for a complementary project under consideration involving construction of a 17-mile gas pipeline from Venezuela to Aruba that would deliver excess natural gas from Paraguana for use at the San Nicolas upgrader, the Venezuelan state-owned company said in June.

PDVSA, however, has yet to reveal a timeline for when it will reach a decision on the proposed pipeline project.

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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