The sudden cessation of work at the Kuwaiti Al-Zour refinery, yesterday evening, Sunday, November 12, caused confusion in the accounts of the European market, which has become the first importer of oil derivatives from that refinery, amid fears that the cessation will continue for a period longer than that announced.
The Kuwait Integrated Petroleum Industries Company (KIPIC) had announced in a tweet on its official page on the X website (formerly Twitter) that the refinery – with a production capacity of 615 thousand barrels per day – had stopped as a result of a sudden interruption in fuel gas supplies due to a defect in one of the main valves of the Kuwait Oil Company. .
The company says, “The technical teams at the refinery are working to gradually restart the production units, and it is expected that the restart operations will take approximately 10 days to return to the previous production capacity.”
Meanwhile, Kuwaiti sources, in statements to the specialized energy platform, ruled out resuming the refinery’s work at full production capacity during the date announced in the KIPCO statement.
The sources – who declined to publish their names, since they were not authorized to make a media statement – said: “Returning to full and normal productivity may take 12 to 15 days… before that there will be a gradual operation, but it will not return to full capacity for two weeks, and perhaps longer than that.” “.
For its part, the energy platform sent a request to the Kuwaiti Ministry of Oil for comment, but did not receive a response.
A shock to European markets
Director of the Technical Affairs Department, senior refining expert at the Organization of Arab Petroleum Exporting Countries (OAPEC), Engineer Imad Nassif Makki, says: “The cessation of a giant refinery with a refining capacity of 615 thousand barrels per day designated for export to European markets will lead to confusion in the importing market, especially in light of the current circumstances.” The repercussions of the Russian-Ukrainian war.
Makki added in exclusive statements to the Energy Platform: “Fortunately, the downtime of the Al-Zour Refinery does not exceed 10 days, which is the period that falls within the policy of strategic storage of the refinery’s products followed by the State of Kuwait, to maintain the continuation of exports in emergency situations and to ensure its reputation.” With customers.
The Director of the Technical Affairs Department at OAPEC stressed that “the reason for the stoppage was a malfunction in one of the valves controlling the gaseous fuel entering the refinery, and that the specialized teams are working to repair it.”
Engineer Imad Nassif Makki – Photo courtesy of OAPEC
Production of Al-Zour Kuwaiti refinery
The Kuwait Integrated Petroleum Industries Company (KIPIC) hopes to increase the production of Al-Zour Refinery, at a later time, from 615 thousand barrels per day at the present time, to 800 thousand barrels per day.
The company’s CEO, Walid Al-Badr, had confirmed in statements, during October 2023, that the additional capacity of the refinery was possible within months of “safe and stable operation” of the facility, indicating that the increase would not require the launch of new facilities, but rather enhancing the ability of existing units to receive Feedstock only.
The combined capacity of the other two refineries in Kuwait (Al-Ahmadi and Mina Abdullah) is 800 thousand barrels per day, after they were developed within the framework of the environmental fuel project.
Exports of Kuwaiti petroleum products are growing rapidly since the new refining capabilities entered service during the first half of 2023, after the completion of continuous expansion work in the refineries over the past two years.
One of the Kuwaiti Al-Zour Refinery facilities – photo from KIPIC’s website
Exports from Kuwait’s Al-Zour Refinery
A recent report issued by the US Energy Information Administration, during the month of September 2023 – viewed by the Energy Research Unit – showed that Kuwait’s exports exceeded one million barrels per day of petroleum derivatives and liquefied petroleum gas on average during the months of June and July 2023, which is the highest The volume of products the country has ever exported.
In contrast, crude oil exports reached 1.6 million barrels per day during the same two months, compared to an average of 1.8 million barrels per day in the same period in 2022, which shows that there is a shift to focus on exports of oil derivatives in Kuwait.
The capacity of Kuwaiti refineries increased to process 1.4 million barrels per day of crude oil by the end of July 2023, which is double the refining capacity of 600 thousand barrels per day in January 2021, and most of the additional quantities were from the Al-Zour refinery.
The Kuwaiti Al-Zour refinery is classified as the largest in the Middle East in terms of production capacity, which it produces through 3 processing units that were operated in stages.
Since the start of commercial operations in November 2023, the Kuwaiti Al-Zour Refinery has exported 1.7 million tons of jet fuel and low-sulfur diesel to France, Greece, the Netherlands, and Britain, so the cessation of the refinery will confuse the accounts of these countries.
Kuwait doubled exports of high-sulfur fuel oil last October, with local demand declining after temperatures dropped in the country.
The Kuwait Petroleum Corporation – according to data seen by the specialized energy platform – increased its spot bids for high-sulfur fuel oil sales last month.
The following graph shows the volume of Kuwait’s exports of low-sulfur diesel during the period (2019-2023), according to Kepler data obtained by the specialized energy platform:
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2023-11-13 13:42:26
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