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Texas authorities halt Citgo refinery project – Venezuela

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This topic contains 1 reply, has 1 voice, and was last updated by  Charles Randall 14 years ago.

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  • #4054

    Charles Randall
    Participant

    Texas authorities halt Citgo refinery project – Venezuela
    Published: Friday, February 2, 2007 12:45 (GMT -0400)

    US authorities have halted a project by Houston-based Citgo, the marketing and refining arm of Venezuela ‘s state oil firm PDVSA, to increase gasoline production at its Corpus Christi refinery in Texas , a PDVSA official confirmed.
    But PDVSA deputy president for refining Alejandro Granado told BNamericas he did not anticipate major regulatory issues arising from the decision by the Texas Commission on Environmental Quality (TCEQ) to put the project on hold because of “insufficient documentation.”
    And Granado denied there was any link between the decision and Venezuela ‘s President Hugo Chávez labeling George W Bush a “war criminal” on Thursday.
    “We are not asking for Corpus Christi to be expanded. There are documents and requisites demanded by law… it’s a normal process that has its timeframes and deadlines and we are entirely within those,” said Granado.
    In his latest tirade against theUS, Chávez said Bush should resign because he lacks what it takes to govern.
    Citgo said in a statement it “has been notified by TCEQ it has returned… an amendment application for a minor project at the Corpus Christi refinery which seeks to increase gasoline production through the installation of small modifications to the fluidized catalytic cracking unit” or FCC.
    Corpus Christi has installed capacity of 165,000b/d. Citgo “is reviewing the concerns expressed by TCEQ and evaluating a path forward,” the statement said. Citgo also says it is “committed to complying with Environmental Protection Agency (EPA) and TCEQ mandates to reduce emissions.”
    Citgo owns five refineries and PDVSA has interests in another two refineries in North America: Hovensa in the US Virgin Islands together with Amerada Hess, and Chalmette, Louisiana, in a 50:50 partnership with oil giantExxonMobil .
    PDVSA last year sold a 40%-plus interest in another Texas refinery in Houston for over US$1bn to Lyondell, which already owned the remaining stake.

  • #7457

    Charles Randall
    Participant

    Here is latest update on Chavez and problems cascading into Citgo operations as backwash.
     
    This one is minor to the recent loss of retail customer 7-11 and problems with angry customer bycotts of Citgo stations as result of Chavez anti-US and anti-Bush speeches. Valero has recently profited from the Citgo’s sale of its Northern Midwest gas stations. All of these impacts are showing up in earnings reports.
     
    An Oil companies good reputation comes at high prices and are hard to win, but easy to loose – just ask battered BP Oil who is struggling to recover from Texas city blast and other high profile safety violations. The continued production problems (especially at Texas City ), and reduced refining margins led to a drop of 12-22% in profits (depending on whose coverage you read) – but BP still cleared 11 billion in profits.
     
    It will take a lot of strategy, advertising and investments to gain back BP’s tarnished reputation ……. A costly example that CItgo is only beginning to understand and re-inforcement of this is likely to come in 2007, along with a flood of Canadian Syncrude via newly completed pipelines and upgrader projects into refineries of PDVSA’s previous partners (who are awaiting continued nationalization of Venezulean assets, increasing taxes and tarrifs despite long term agreements).
     

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