Pemex pushes full Olmeca start-up past 2023

Bnamericas Published: Thursday, December 22, 2022

The updated five-year business plan of Mexican state-owned oil and gas giant Pemex confirms that the date to start full operations of the US$12bn-US$16bn Olmeca refinery has been modified.

Authorities previously insisted the refinery will start operating this year and reach full refining capacity of 340,000b/d some time next year. Experts have always doubted this schedule, some even claiming processing would not start before 2024.

Now, Pemex also does not expect a significant rise in crude refining capacity until well into 2024, according to its 2023-27 business plan.

The firm expects to process an average of 995,000b/d next year, compared to its average yield between January and September of 808,000b/d. Production is expected to rise, in part, due to efforts to increase utilization of its existing refineries, which rose from 43% to 49% between 2021 and the first three quarters of 2022.

A big capacity jump is expected for 2024, to 1.34 million barrels per day, or 35% in one year. An additional 48,000b/d of refining capacity would come online in 2025, as Olmeca reaches its full output. After that, national refining capacity would stabilize through 2027.

Energy minister Rocío Nahle said earlier this month that Olmeca was planned to start processing crude in early 2023 and that production could ramp up throughout 2023. 

The refinery was originally planned to be fully operational within four years, starting in 2018, and was inaugurated by President Andrés Manuel López Obrador in June, although experts said it was far from finished.

Refining pipeline

Pemex said Olmeca had received most critical equipment and that installation had started. Meanwhile, the associated cogeneration plant and water system are being built. The control room is "practically finished," Pemex said. The dock access and the main road have been completed.

The company’s board also greenlighted US$853mn to pay for operations start-up.

Meanwhile, Pemex was planning to complete the Tula refinery in Hidalgo state in 2024. Work started in 2013 to reduce bunker oil output and increase gasoline and diesel yield.

Similar works also started at the Salina Cruz refinery in Oaxaca state this year. The overhaul is expected to finish in 2025.

Pemex is also building four cogeneration plants at its Salina Cruz, Tula, Cadereyta (Nuevo León) and Madero (Tamaulipas) refineries, as well as one at its La Cangrejera petrochemical complex in Coatzalcoalcos. These units are expected to come online in 2025.

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