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 Hard times have pushed them to pick and choose from a wider range of
crudes, ferry feedstock between their own refineries to get the
optimal mix of products and seek out deeper discounts from
suppliers.
"Commercial operations need to be totally, fully integrated with the
technical aspects," Dario Scaffardi, general manager of Italian
refiner Saras told the Platts refining summit. "It's been the single
most important thing that we've concentrated on. You have to look
for the most challenging crudes."
Scaffardi said his refinery processed 30-35 different types of crude
oil in 2015 – double the previous year.
The U.S. shale oil revolution changed flows of oil worldwide and
pushed some crudes, such as Nigeria's light sweet oil, out of its
traditional markets and forced sellers of heavier, harder-to-process
oils to slash prices in order to secure buyers.
The strategy follows similar moves from Shell and Total, which are
bringing refining and trading operations closer together to drive
profits amid falling oil prices and as independent trading houses
impinge on their business.
Refiners at the conference said that while their industry faces a
punishing decade, with more closures to come, the new palette of
crudes available can keep agile European plants alive while their
less adaptable competitors face the axe.
While some 2 million barrels per day (bpd) of refining capacity have
shut down since 2009, Goran Saravanja, strategy development director
with Croatian refinery INA, said as much as 25 percent more of
Europe's refining would still need to close over the next 15 years.
INA itself, Saravanja said, plans to operate just one refining site
in the long term, though the Croatian government, a company
shareholder, has blocked permanent closure of its Sisak refinery.
Europe's refineries are aging, and poorly configured, producing
mostly gasoline, while its buyers want diesel.
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A five-year high in gasoline demand in the United States, which
helped support Europe's refinery margins, is now ebbing, the U.S.
Energy Information Administration's Tim Hess told the conference,
and will remain largely flat over the coming year.
Lars Thorstholm, asset optimization manager with Norway's Statoil,
said his firm had also taken steps in the past year to experiment
with different crudes, and leaves it to the team trading oil – those
with a front-line view of which oil grades can bring the most value
in any given market environment – to make the most of the company's
refining.
"It is the trading arm who is responsible for optimizing the
refinery," Thorstholm said.
His company, a producer of North Sea crude oil, said it had even
chartered a vessel this year to use as floating storage in order to
increase operational flexibility.
(Reporting By Libby George, editing by William Hardy)
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