Rosneft Tests New Unit at Tuapse Refinery
Oil producer Rosneft started test runs of a new vacuum unit at its refinery in the Black Sea port of Tuapse this month as it plans to start production of vacuum gas oil (VGO) and to launch exports in June, industry sources said.
"They (Rosneft) started operations of a vacuum unit (at the Tuapse refinery), but so far only in a test mode," one trader told Reuters.
According to one industry source, the Tuapse refinery can produce up to 4 million tonnes of VGO a year based on the nominal capacity of its crude distillation unit (CDU-12) of 12 million tonnes a year. The plant currently runs at around 80 percent of its capacity.
Rosneft declined to comment.
On Wednesday, Rosneft offered up to 90,000 tonnes of VGO with a sulphur content of up to 3.0 percent produced at the Tuapse refinery at its first tender. Delivery is set at between June 1 and 30 on a free-on-board (FOB) Tuapse basis.
The tender will last until 1.00 p.m. (10 am GMT) Moscow time, May 12. The results will be announced by 3.00 p.m. Moscow time on May 22, the company said on its website.
"The 90,000 tonnes (offered via tender) is just an approximate volume. They (Rosneft) probably don't know yet how the vacuum unit is going to work," one of the sources said.
The launch of the atmospheric residue vacuum distillation unit will also allow Rosneft to improve refining margins as VGO is more expensive than fuel oil, which is used as feedstock for the unit.
"VGO is a value-added product, the market is good, so (the move) is right on time," another source said. The source said that VGO exports from Bashneft's refineries in Ufa in central Russia near the Ural mountains were not there anymore and Lukoil was cutting production.
Trading sources said Rosneft would probably export VGO from Tuapse until 2019 when the plant is expected to launch a hydrocracking unit. After the new unit is installed, VGO will be used to produce diesel.
So far, Rosneft has produced VGO at its plants in Saratov, Ryazan and Novokuibyshevsk. According to the Energy Ministry, Rosneft produced 476,000 tonnes of VGO in the first quarter of 2015, of which its Saratov plant accounted for 360,000 tonnes.
Russian refineries cut VGO production by 39 percent in the first three months of 2015, year-on-year, due to an output decline at Lukoil's Perm plant.
The Tuapse plant refined a total of 2.4 million tonnes of crude oil in the first quarter of 2015 and produced 0.442 million tonnes of straight-run gasoline, 0.792 million tonnes of diesel fuel (with a 0.2 percent sulphur content) and 1.140 million tonnes of fuel oil.
(Reporting by Natalia Chumakova and Maxim Nazarov; Editing by Katya Golubkova and Jane Merriman)
