An expansion project estimated to cost $2 billion and initially discussed nine years ago is expected to be completed in the coming days at Exxon Mobil Corp’s Beaumont, Texas refinery.
According to sources familiar with the matter, the Beaumont refinery will become the largest in the country on January 31 upon the initial inauguration of a 250,000 bpd crude distillation unit (CDU) at the 369,000 bpd refinery.
Amid U.S. President Joe Biden’s pressure on refiners to increase fuel production or face penalties, this refinery will mark the first substantial expansion in U.S. oil processing in over a decade.
Exxon’s spokesperson did not want to comment on when the unit will first be put into operation. Exxon has stated that production will begin in the first quarter of 2023.
“Construction of the new crude unit is completed. We have initiated startup procedures and commissioning is underway,” said Chevalier Gray, Exxon spokesperson in a statement. “The unit will add 250,000 barrels per day of all new supply for the refined products market.”
The Beaumont Light Atmospheric Distillation Expansion project (BLADE) has been in the process since at least 2014 and was finally given the green light this year. Exxon’s crude oil will be processed at the facility, which will be located in West Texas and New Mexico near the Permian shale area.
On Friday, Exxon announced that the overall cost for BLADE is $2 billion. On September 28th, the corporation submitted with the Texas Comptroller’s office requesting a reduction in property taxes, stating that they had invested a total of $1.2 billion over the years.
The addition of the third CDU to the Beaumont refinery will result in a 68% production increase. Crude Dehydration Units (CDUs) are the first units in a refinery, and their purpose is to convert crude into feedstocks for the other units.
Exxon’s Beaumont expansion entered into a new era of steady refining capacity growth by optimizing existing operations and installing new machinery.
According to Matthew Blair, the head of research for refiners, chemicals, and renewable fuels at energy banking firm Tudor, Pickering, Holt & Co., numerous big oil companies are building refineries outside of the United States.
“Overall, there are quite a number of new refineries on the docket this year,” said Blair said, noting projects in Kuwait, Mexico, Nigeria and China. “This will help rebalance global markets and bring down product cracks.”
Original source material for this article taken from here